InfuSystem Holdings Inc

AMEX:INFU

Earnings Call Analysis

Earnings Call Transcript 2023-Q3

[Operator]

Good day, and welcome to the InfuSystem Holdings Inc. reports Third Quarter 2020 Financial Results Conference Call. [Operator Instructions] Please note, this event is being recorded.

I would now like to turn the conference over to Joe Dormay, Managing Partner. Please go ahead.

[Joe Dorame]

Good morning, and thanks for joining us today to review InfuSystem's financial results for the third quarter of 2023 ended September 30, 2023. With us today on the call are Rich Dilorio, Chief Executive Officer; Barry Steele, Chief Financial Officer; and Carrie Lachance, President and Chief Operating Officer.

After the conclusion of today's prepared remarks, we will open the call for questions. Before we begin with prepared remarks, I would like to remind everyone certain statements made by the management team of InfuSystem during this conference call constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Except for the statements of historical fact, this conference call may contain forward-looking statements that involve risks and uncertainties, some of which are detailed under risk factors and documents filed by the company with the Securities and Exchange Commission, including the annual report on Form 10-K for the year ended December 31, 2022. Forward-looking statements speak only as of the date the statements were made. The company can give no assurance that such forward-looking statements will prove to be correct. InfuSystem does not undertake and specifically disclaims any obligation to update any forward-looking statements, except as required by law.

Now I'd like to turn the call over to Rich Dilorio, Chief Executive Officer of InfuSystem. Rich?

[Richard DiIorio, executive]

Thank you, Joe, and good morning, everyone. Welcome to InfuSystem's third quarter 2023 earnings call. Thank you all for joining us today.

I'm going to start this call by reiterating that our key theme for the year has been the 2023 is a year of execution. And I believe our financial results show delivery of strong execution. Not only was the recently completed third quarter, the seventh consecutive quarter with record revenue, it was the second quarter in a row with revenue up 17% or more when compared to the prior year.

Shifting from the top line to the bottom line, we see continued improvement in our margins and operating income. Operating income in the third quarter increased 80% year-over-year and net income was up 56%. Adjusted EBITDA was $6.2 million for the quarter, up 11% from the prior year. While I think that's a solid adjusted EBITDA number with a nice trend line, on a year-to-date basis, we are slightly behind where we originally planned to be versus our original budget. This is because our adjusted EBITDA was suppressed early in the year because of the investments made in the first quarter to accelerate and pull forward the onboarding of devices under the initial master services agreement with GE. We elected to make the necessary investments ahead of our original plan and succeeded in pulling forward that revenue, resulting in the strong growth we have delivered over the last couple of quarters.

So 2023 has been an execution year in terms of delivering on new revenue opportunities and setting the stage for more revenue in future years. The next phase of execution will be the fine-tuning and the continuous process of identifying and implementing operating improvements that will improve and maintain our long-term operating margins. That will be the story for the rest of this year and into next year. After Barry provides his review of the quarter, Carrie will provide some color on the things that we are doing, and how our margins are improving as we achieve scale and begin ironing out our processes with our GE Biomed business and start leveraging our national network of technicians.

Now turning to guidance. In August, we updated our guidance for the full year, estimating net revenue growth of 10-plus percent and adjusted EBITDA margin to be between 17% and 18%. We expect our revenue to come in above the range previously provided. How much above depends on a variety of factors, some of which are outside of our control. Accordingly, we will continue to take a very conservative approach and raised our full year guidance to have net revenue growth of 11-plus percent. For adjusted EBITDA, we are maintaining our adjusted EBITDA margin range of 17% to 18%.

Now I'd like to turn the call over to Barry, who will provide more detail on our financial performance in the third quarter.

[Barry Steele, executive]

Thank you, Rich, and thank you, everyone, on the call for joining us today.

I'm going to focus on 3 topics. The main drivers for the current quarter's results, our fourth quarter outlook and our current financial position and how it changed during the quarter. First, let me touch on our financial results for the period. Net revenues for the third quarter of 2023 totaled $31.9 million, representing a $4.6 million or 17% increase from the prior year and setting another new all-time revenue record for the seventh straight quarter, also the eighth record in the last 9 quarters. The 3 main drivers of this increase were higher revenue from the GE Healthcare contract totaling $2.6 million, higher lease equipment sales of negative pressure wound therapy devices totaling $1.1 million and higher revenue in oncology totaling $800,000. At September 30th, the annualized revenue run rate for devices onboarded to the GE contract stood at approximately $11 million, an increase of $2 million from where we started the quarter. Gross profit for the third quarter of 2023 was $16.2 million, which was $1 million or 6% higher than the prior year third quarter. This was mainly driven by the higher sales but was partially offset by a lower gross margin percentage, which was 50.9% during the third quarter of 2023, down from 59.5% from the prior year. The year-over-year decrease was mainly due to unfavorable product mix changes and additional start-up costs for the GE Healthcare Biomedical Services contract. The product mix impact is due to the higher biomedical revenue and the negative pressure wound therapy equipment sales growth, both of which have a lower gross margin than the company average. GE Healthcare startup costs are estimated to have been about $1.2 million for the 2023 third quarter. This amount continues to be higher than we originally planned and was a larger amount than in the first and second quarters due to the higher revenue volume. We continue to anticipate that these elevated amounts will dissipate over the next several quarters and then our margin will approach our original estimates once we reach full ramp and circle pass the first year of coverage for the growing number of devices.

Selling, general and administrative expenses for the third quarter of 2023 totaled $14.5 million, representing a decrease of $333,000 or 2% as compared to the prior year. The amount was 45.6% of revenue, which represented a 10.4% decrease from the prior year ratio, which was 56%. As a result of these impacts, our adjusted EBITDA was $6.2 million or 19.4% of net revenue during the 2023 third quarter, which represented an increase in the prior year totaling $600,000 and an increase sequentially from the 2023 second quarter totaling $400,000.

Turning to the prospects for the fourth quarter. As Rich stated, we now expect our annual revenue growth rate to be over 11%. This amount represents an increase from our outlook at the end of the last quarter when our minimum growth forecast was 10%. While we do expect a sequential decrease in our fourth quarter revenue, mostly due to timing issues, the amount implied by an 11% annual growth rate represents a significant hedge that almost ensures that will not have a year-end miss. The timing issues are twofold. First, during the fourth quarter, it is likely that we will deliver fewer negative pressure wood therapy devices, which totaled $1.1 million in revenue during the third quarter. This reflects the quarter-to-quarter variability we typically experience in equipment sales. Second, we are expecting revenue for the GE Healthcare contract to be about $500,000 lower in the fourth quarter compared to the third quarter. This is mainly due to our quicker-than-expected ramp-up in adding devices to the contract during the year, which has resulted in a lower number of devices being onboarded in the fourth quarter and consequently, less of the initial per device onboarding related revenue being recognized. We do not currently see any other specific additional sequential revenue reductions. We are holding our minimum outlook at 11% to provide for an extra measure of assurance.

Turning to a few points on our financial position and capital reserves. As we indicated during the second quarter call in August, our operating cash flow for the third quarter totaling $4.3 million increased sequentially for the second straight quarter and represented an increase of $800,000 over the prior year third quarter. This was due to a lower amount of growth in working capital levels, which reflected a slower sequential revenue increase from the 2023 prior quarter than for the earlier 2 quarters. We expect this trend to continue in the fourth quarter. Additionally, our net capital expenditures were a relatively low $300,000 during the third quarter. This lower amount is partially related to the timing of our pump equipment purchases during the year and due to the fact that much of our growth was derived from less capital-intensive revenue sources such as biomedical services and wound care. The capital required to fund Negative Pressure Wound Therapy equipment leases shows up in our working capital investments, i.e., operating cash flow and not capital expenditures. Because of these factors, our net debt decreased by $3.5 million to $32.5 million, and our available liquidity totaled $41.7 million at the end of the quarter. The decrease in total debt and higher trailing 4 quarter adjusted EBITDA caused our ratio of total debt to adjusted EBITDA to decrease modestly to 1.5x at the end of the quarter as compared to 1.59x at the end of the 2022 fourth quarter. Our debt consists of borrowing on our revolving line of credit with no term payment requirements, nearly 5 years in the remaining term and with $20 million of the outstanding balance protected from increasing interest rates through an interest rate swap having the same term.

I'm now going to turn the call over to Carrie, who will provide more detail on what we are doing to improve our operating margins.

[Carrie Lachance, executive]

Thanks, Barry, and good morning, everyone.

As Rich indicated earlier, I'd like to provide some color on what we are doing to improve our operational efficiencies after new business has been onboarded. Today, that is primarily related to our Biomed business where the opportunity is greatest. In Wound Care, we are still mostly preparing the channel with negative pressure pump placements and activity where we have a lot of prior experience and are already very efficient. To start, the primary driver in biomed is onboarding of the GE master services agreement involving roughly 230,000 devices located in facilities across the country. For each of these facilities, there is, of course, an initial onboarding visit that must occur. We do have much prior planning as we can, but there are several details unique to each facility that our teams must deal with. Where to park, how to gain access, introductions to key people and the big one, locating all of the pumps to be serviced. That make the first visit the most time-consuming and least-efficient engagement. Fortunately, we are nearing the end of our initial onboarding and each subsequent visit will build upon the experience of the prior, and we expect things to become progressively better as we improve on hiring, training and deploying our personnel and managed travel costs. The biggest area of improvement we see is in staffing and staffing costs. In the beginning, the overarching objective was to please the client. We are known for our premium concierge level services. We get the job done, we do things right, and we do it the first time. To ensure this at the beginning, we erred on the side of overstaffing projects as we settled into the workload and cycles of visiting our contracted sites, subsequent visits will benefit from rightsized teams, more experienced technicians and firsthand experience with the facilities where these teams work. Additionally and potentially even more important, is our having used the first year to build our national network of biomed technicians. Our traveling teams were often bigger the first time around because of our regional technicians not being in place.

Going forward, when it's time for annual inventory and preventative means, the work will be more organized and will have even greater familiarity with each site that has already been matched with one of our regional technicians.

A last point on this, the national network of technicians we are building is an asset that extends beyond the GE relationship. Our biomed technicians are not always locked into a single site. They are locally mobile and will often cover multiple sites. This means that as we gain experience and efficiency, they can and will be used to provide services at locations outside of the GE contracted facilities. We have opportunity in areas to add new business to that will absorb the capacity of our regional technicians and add more techs to geographies where we will win additional business. Each geography will be supported by the surge capacity of our traveling teams. The flexibility of this structure to be lean with the workflow warrants and to be able to surge into parts of the country to satisfy one-off or periodic customer needs aligns very well with our concierge model of service. We have been making steady progress throughout 2023 to put the biomedical sources model into place, and we believe the benefit will continue to show into 2024 in both the top and bottom line.

At this point, I would like to turn the call back over to Rich.

[Richard DiIorio, executive]

Thanks, Carrie. After completing the first 3 quarters of 2023, I continue to be very pleased with our performance, and I am excited about InfuSystem's future potential. We promised execution. And in 2023, we're delivering strong revenue growth and have started the process of fine-tuning around that revenue, improving our efficiencies and our operating margins.

Looking forward, I expect the execution story in 2024 will advance to include material improvements in our operating returns. We are still in the planning phase, but as Barry and Carrie explained, we are steadily increasing our efficiencies and expect these trends to continue. For the time being, we expect that Biomed and Wound Care will be our primary growth drivers. We do expect to see incremental growth across nearly all of our activity lines in 2024, but the strongest drivers will be these 2. And while we are always interested in learning about material new growth opportunities, we believe our attention going into 2024 will be best focused executing on our continuing opportunities in Biomed and Wound Care. In Biomed, this means completing the GE onboarding and then adding incremental and most likely smaller projects to our growing national network of technicians. In Wound Care, this will mean continuing to place hardware into the channel and working with our joint venture partner, Sanara, to open that channel to distribution of the joint venture's Advanced Wound Care products. Both of these opportunities will continue to scale, and they will become significantly more accretive in 2024. Both have tremendous remaining potential and both are expected to be material contributors to our top and bottom line growth for years to come.

Operator, we are now ready for questions.

[Operator]

[Operator Instructions] Our first question comes from Brooks O'Neil with Lake Street Capital Market.

[Brooks O'Neil, analyst]

And congratulations on the strong results. I have a few questions. I guess I'd like to start by focusing on your 2 growth businesses. It sounded like in facilities where GE has equipment that you're primarily focused on servicing GE. And I'm curious is the pipeline of incremental opportunities beyond GE really building. Can you give us any color on that? And did I hear you correctly that where GE has the presence you're primarily focused on them?

[Richard DiIorio, executive]

Yes. So where GE has a presence, we're definitely focused on them, right? So they don't have a contract for just the pumps, they have contracts for everything in that hospital. So we wouldn't want to kind of step on their toes. I think as far as incremental opportunities outside of GE and beyond GE, we have a team that's going to be their job is selling the biomedical services into non-GE facilities, which there's roughly 2,000 or 3,000 beyond GE's purview. We've been purposely holding off on that because we wanted to establish the team where they were work, hiring out the challenges from a logistics standpoint and be ready. And we knew we had to execute on GE first and foremost. Now we're not starting to get to more of a stable space and even more so in the first quarter. Once that happens, then we can start bringing in non-GE facilities. But if we have done that too early, we would have field on both sides.

[Brooks O'Neil, analyst]

Sure. That makes total sense. I appreciate that color. Let me turn to a Wound Care. I guess I'm not as familiar as maybe I should be with the lease arrangement that you referenced and the dynamics there. So if you could give us a little bit of color on what that is, and what's going on there, that would be great. And then as well, if you could give us a little more color on how things are going with the joint venture with Sanara that would be extremely helpful too.

[Richard DiIorio, executive]

Sure. So on the lease side, we're leasing equipment directly to customers and through a distributor, a large distributor. So we lease their equipment. Barry can get into how we recognize the revenue in a second, but it's core devices. There'll be some Genadyne devices coming in soon too. We lease them, we book them as a sale effectively. They put them into the skilled nursing facility, the long-term care facility, and they sit there, and they effectively own them once we should promote. And Barry, I don't know if you want to talk about how we recognize.

[Barry Steele, executive]

Yes. It's basically just equipment sales where we get the payments over 36 months, the lease one qualifies for what's called the sales-type lease accounting. Again, we're booking revenue. The cost of the equipment to us is our cost of sales. So it's just like any equipment sale. We just wait to get paid. There is a small cost of capital component built into us. We recognized a little bit of interest revenue and the revenue line over the 36-month period, but it's not very much.

[Richard DiIorio, executive]

And then on the Sanara piece, we are starting now. The team is now -- all the back-end systems are effectively done. There's still something to do, but the team now has a pipeline with physician groups to go out and start placing the BIAKOS and high call products from Sanara, and we're going to start seeing that pretty soon. I think we're still expecting it to be kind of real and significant at the end of next year. But there'll be some products that start going out the door here very soon, hopefully, by the end of this year or very early next year.

[Brooks O'Neil, analyst]

Great. And can you just help me to understand one final thing, which is, is there an overlap between what you're doing with the Sanara partnership and the placement of these negative pressure devices in nursing homes, or are they fairly separate opportunities as you think about it today?

[Richard DiIorio, executive]

Yes. So I think the placing of the leases is separate to start, right? So it's kind of a single channel through a distributor largely. But the good news is once our equipment is in there, that relationship, hopefully, will blossom, and that gives us the opportunity to play Sanara products into those same nursing homes and long-term care facility. So there should be -- we should be able to combo those products in those same facilities, not every single one, but absolutely, there should be synergies there.

[Brooks O'Neil, analyst]

Interesting. Let me ask one last question, I apologize. I have a sense that there are some mobile operators in the Wound Care business today that are, I think, having some pretty good success. Have you seen that? And is there any opportunity for you guys to interact with mobile operators, or do you see this as being primarily focused on nursing homes and what I might call fixed site location.

[Richard DiIorio, executive]

Brooks, do you mean in mobile operators you're talking about the traveling physician groups?

[Brooks O'Neil, analyst]

Yes. And I just have a sense that there are people who have bands that put negative pressure devices in there and go around not just operating on nursing home, but maybe the patients in multiple nursing homes in a community or that kind of thing. And I think that opportunity is growing pretty fast [Indiscernible].

[Richard DiIorio, executive]

Yes. So yes, so we call those guys traveling physician groups. So there are doctors that are just contracted with different facilities, right? So they're not -- they don't work at any of them. They're contracted out. That's a huge opportunity. It might be one of the single biggest opportunities because there are a ton of them around the country. They tend to be regional, but when you get those guys, you can cover a lot of skilled nursing facilities and long-term care facilities with those single groups because the facilities themselves aren't going to employ a full-time wound care doctor typically. That is definitely a big opportunity. They are in our pipeline. We have some relationships with those guys. So when we start to see real revenue back into next year, they will be a apiece that for sure.

[Operator]

Our next question comes from Alex Nowak with Craig-Hallum.

[Alexander Nowak, analyst]

So the bolus of Wound revenue in the first 3 quarters of the year, that's because you placed a lot of these systems. So is that recurring 36-month payment going to start to kick in more in future quarters and that helps with margins and kind of treat that like a consumable play. I'm just trying to think of all the systems that you placed so far like this is going to be a longer-lasting benefit over the next few and -- next 3 years.

[Richard DiIorio, executive]

So I think we recognize the revenue upfront. There will be a piece of -- so we'll sell the consumables as well. It's a much smaller number, right? When we -- if we have $1 million in leases in the quarter, the consumables might be $100,000 or less. So that will be kind of the consumable piece that we'll see coming down the pike. I think one thing that I want to make sure that everyone knows is that we have this big bolus of leases over the first 3 quarters, right? It doesn't mean that we're done, right? It's going to be part of our forecasting, hopefully forever. We're going to continue to get leases. The pipeline is full. We're not going to guess when it comes to our guidance on when those leases will come to fruition, but the sales reps are out there selling leases outside of the distribution agreement every day of the week. So it's not like it's going to be gone. It's just -- we're not going to see that kind of burst of revenue every quarter forever. But we will continue to place leases.

[Alexander Nowak, analyst]

Okay. All right. No, that makes sense. And I know we've talked about this in the past, but the revenue from the Sanara JV, when can we start to say that's contributing to top line in a meaningful way. Is that a 2024 time period.

[Barry Steele, executive]

Yes. So the leases were kind of really a part of the joint venture, so we could say now. But any revenue that we have going forward will be booked on our top line, and then [Indiscernible], the JV actually is just a purchasing vehicle where we can share the profit that's built into the supply chain.

[Alexander Nowak, analyst]

Okay. Okay. Got it. Got it. All right. That makes sense. So then the gross margin, it's been impacted in the last couple of quarters here, and you walked through all those sort of operational improvements you're going to be making. So that's very helpful. I guess as you get into the middle of 2024, do you get back to a high 50s gross margin, or is it really we got to wait until end of 2024 or 2025, until we can start to see the leverage there?

[Barry Steele, executive]

Yes, I don't know that we get necessarily back to high 50s. Keep in mind that some of that additional business is just lower gross margin, say the biomed, for example. The nice thing is that it doesn't add a lot of G&A. So from an EBITDA margin perspective, we're getting -- we're approaching back to the 20% margin, and we should be able to break through that next year at some point as we continue to be more efficient on delivering those services.

[Alexander Nowak, analyst]

Okay. Got it. And then on the revenue guide, I appreciate the conservatism. There's a lot of factors that play here outside to control. So what's at a level that we can beat. But on the flip side, 11% growth that gets you to the lowest -- would essentially put your Q4 at the lowest quarter of the year, which based on the commentary, I don't think would be necessarily correct. So maybe just the puts and takes there? I mean, it seems like more like 12%, 13% growth is more the likely scenario.

[Richard DiIorio, executive]

Yes. So I think I think you're right that we shouldn't have the lowest quarter of the year in the fourth quarter. I would look at the 11-plus percent is that we just moved the floor up, right? So we still expect to beat that number. I can never guarantee a number, but we should be able to beat 11-plus percent. How much more we beat it by? Is there's timing issues? Are there other leases that come in that replace what happened in the third quarter and prior quarters? I think Barry went through the $500,000 in GE just on the timing of the onboarding of new devices and the leases in Q3. Outside of that, I don't have line of sight into anything else that's going to bring us down that far. But we've also had the experience in the last 2 years where things that we didn't have line of sight into hit us in the fourth quarter that we didn't expect, right? We had Omicron in December of '21. Last year, we had the supply chain issue that we had an order for and couldn't get the devices out the door. So we're just giving ourselves some space. So if something like that happens, we can still hit the number because that's one thing that we're going to do is we're going to hit numbers when we put them out there. We just want to make sure we can account for things that we don't even know yet.

[Operator]

[Operator Instructions] The next question comes from Jim Sidoti with Sidoti & Company.

[James Sidoti, analyst]

So first one on SG&A. You don't typically see a company grow the top line 17% and have lower SG&A. Now I know you did reduce some of the sales teams slightly in 2023. But were there any other onetime expenses in 2022 that haven't come back? And -- do you expect to continue to be able to leverage this SG&A line in 2024?

[Barry Steele, executive]

Yes. So there are some seasonal things. So Q1 is a little bit higher in the selling cost as some of our sales meetings and some of our shows and things we do. So you should expect that to come up a little bit. I think that the stock comp bounces around a little bit. So you have to be careful about that. You'll be able to see that amount in the adjusted EBITDA table, so you can kind of pull that out of the sort of the trends, if you will. I think that's our theme is to try to leverage the fixed cost built into G&A as best we can by growing a little faster on the top line. So I think you should hope to see that we can improve margins somewhat by leveraging our SG&A.

[James Sidoti, analyst]

All right. And then can you talk a little bit more about how you're preparing with Sanara. Obviously, you're getting the pumps out there in 2023. But have you started training with those people, or are you ramping up for anything specific in '24? Just give us some color on how that all plays out.

[Richard DiIorio, executive]

Yes. So the team is pretty well trained up and ready to go. They've been filling the pipeline now for months. I would say, once we got the accreditation and licensing that we needed earlier in the year. The team is starting to kind of talk about the products in the market. Then we got all the back-end systems built, I mean all the way down to like what the document looks like that the doctor has to fill out. I mean is that type of detail we have to get to. That's largely done at this point. So the reps are now able to go out and talk about the product again, try to close some deals that are in that pipeline. We've already seen a patient or 2 come in and go on the supplies from Sanara. So as that starts to roll out, it should accelerate relatively quickly. But sales cycles can take 6 to 12 months, and that's why we really think it will be the back end of next year where we really start to see it ramp. But we'll see some revenue early on next year, we should. But the team is ready to go. There's -- and actually to Brooks' point earlier, with the traveling physician groups, our guys have been talking to those groups already. So when we're ready to turn the faucet on, it should go pretty well fairly quickly.

[James Sidoti, analyst]

So just to be clear, so now that you have these pumps out there, you do expect them to generate some type of service and consumable revenue in 2024, the patients who are using these pumps. Is that correct?

[Richard DiIorio, executive]

Yes. Yes, that's correct. I don't think it's a big number. I think it's hundreds of thousands of dollars, not millions of dollars for the pumps that are out there today. The hope is that as we add more equipment in the market, the consumable piece drives up with it, but it's not millions of dollars in '24, it's a relatively small number.

[James Sidoti, analyst]

Okay. All right. And then assuming that things play out the way you're saying, and you do see some decent revenue growth with margin expansion, that should translate into better cash flow. When the cash flow does start to improve, what's going to be the priority? Is it debt pay down? Are you going to look at other opportunities? What do you think regarding cash generation...

[Richard DiIorio, executive]

Sure. Yes. So I think our priority is still to grow the business, to feed the business where we have to. When there are devices to buy with the money or acquisitions to make then we'll look at, is it debt? Is it stock buybacks? And it's what we've done in the past, right? It's opportunistic. If we think the stock is a good value, then we'll go buy some stock back. You can see in the third quarter, we paid down debt with it, write a couple of million dollars. So there's a variety of factors, but I think the priority is still, number one, to invest in the business when we have to. If we have a window of opportunity where we don't have to invest in the business, we'll look at buybacks we're paying down debt.

[James Sidoti, analyst]

All right. And then exactly -- I'm sorry.

[Barry Steele, executive]

I just say one good thing on our debt structure is that we can pay down debt, and they don't lose our commitment. So we know a borrower back. So we have a good efficient way of handling short-term ebbs and flows of our cash flow.

[James Sidoti, analyst]

And then with regards to GE, how many more folks do you think you need to bring on to service all their equipment?

[Richard DiIorio, executive]

We're probably down to get in regional technicians in place in certain geographies. It's a couple of dozen people. It's not a ton of guys.

[James Sidoti, analyst]

So you're about 80%, 90% done with the staff audition?

[Richard DiIorio, executive]

Yes, I think that's a fair assessment.

[Operator]

As we see no further questions. This concludes the question-and-answer session. I would like to turn the conference back over to Rich Dilorio, CEO of the company for any closing remarks

[Richard DiIorio, executive]

I want to thank everyone for participating on today's call, and we look forward to our call in the spring to discuss our fourth quarter and full year results. I hope everyone has a great day.

[Operator]

The conference has now concluded. Thank you for attending today's presentation. You may all now disconnect.