Assertio Holdings Inc

NASDAQ:ASRT

Earnings Call Transcript 2023-Q1

[Operator]

Good afternoon and welcome to the Assertio Holdings, Inc. First Quarter 2023 Financial Results Conference Call. All participants will be in listen-only mode. After today's presentation, there will be an opportunity to ask questions. [Operator Instructions] Please note this event is being recorded.

I would now like to turn the conference over to Matt Kreps from Darrow Associates, Investor Relations for Assertio. Please go ahead.

[Matt Kreps, Darrow Associates, Investor Relations]

Good afternoon and thank you all for joining us today to discuss Assertio's first quarter 2023 financials. The news release covering our earnings for this period is now available on the Investor page of our website at investor.assertiotx.com. I would encourage you to review the release and tables in conjunction with today's discussion.

With me today are Dan Peisert, President and CEO, and Paul Schwichtenberg, Senior Vice President and CFO. Dan will open the remarks and provide an overview of the business followed by Paul who will review our financials. After that, we will open the call for your questions.

During this call, management will make projections and other forward-looking statements regarding our future performance. Such forward-looking statements are not guarantees of future performance and involve risks and uncertainties including those noted in this morning's press release as well as the Assertio's filings with the SEC. These and other risk factors are more fully described in the Risk Factors section and other sections of our annual report on Form 10-K.

Our actual results may differ materially from those projected in the forward-looking statements and Assertio specifically disclaims any intent or obligation to update these forward-looking statements except as required by law.

With that, I'll now turn the call over to Dan.

[Dan Peisert, President and Chief Executive Officer]

Thank you, Matt. I want to start by welcoming our long term shareholders, new shareholders and those that are considering investing in Assertio.

On my very first public call as CEO of Assertio, a short 26 months ago, I laid out my go forward strategy and priorities. My strategy was ambitious, but necessary to put Assertio on a path for success. We needed to develop a sustainable business model that repositioned the business to compete more effectively in a changing environment, improve our profitability and cash flow generation, improve our balance sheet and reduce our cost of capital, protect INDOCIN, add new products to diversify our business and extend the portfolio's duration, create internal opportunities for growth and mitigate our legacy legal uncertainties.

The recent announcement of the acquisition of Spectrum Pharmaceuticals and their key asset, ROLVEDON, was just one of the many tactics that we've completed in the aim of achieving that strategy. I'm proud to say that by the time we closed the acquisition, currently expected to be sometime this third quarter, we will have largely checked the box and everything we set out to do.

I want to offer a heartfelt thank you to not only the executive team, but to all of the employees of Assertio, who have worked so hard in helping us achieve our goals.

After the close of the acquisition, we'll have a business aligned with the realities of the business environment of today and the future, where contracting and market access are critical to success as opposed to pure salesforce size.

In addition, we'll soon have complementary digital and in-person promotional platforms that we can continue to add products into, providing further value to patients, our customers and our shareholders.

The execution of our strategy has had the most profound impact on our balance sheet to date. On March 31, we had $68.6 million of cash and $40 million of long term debt with a 2027 maturity. This is the first time we've been in a positive net cash position since March 2020.

For an even more dramatic comparison, in December of 2020, when Paul and I took over a CEO and CFO, we had $20.8 million of cash and $85 million of debt, maturing early 2024. In just a little over two years, we've flipped from net debt to net cash, a positive swing of almost $94 million. We extended our maturities by three-and-a-half years, reduced our cost of debt from 13% to 6.5% and achieved this, all while spending $60 million in cash to acquire two new assets with patents extending into the 2030s.

This was a strong first quarter for Assertio. We started with a $5 million hole due to the loss of exclusivity for both Cambia and Zipsor and the discontinuation of the Solumatrix product line. Instead of declining, net product sales grew 18% versus the prior year quarter.

Growth in INDOCIN and the addition of Sympazan more than made up for those losses. We entered the year expecting to see some of the normal seasonality in our business affect our top line, but it didn't materialize to the extent we thought and the products outperformed our demand forecast, including Cambia.

Adjusted EBITDA also grew 7% year-over-year, maintaining our margin at 60%, while making investments in our non-personal platform and putting marketing effort behind our two newest products, Sympazan and Otrexup.

As a result of the strong performance this quarter, we're increasing our full year guidance for both net product sales and adjusted EBITDA. We now expect net product sales to be $157 million to $167 million, representing growth of 1.2% to 7.7% versus the prior year. And adjusted EBITDA to be between $90 million and $98 million. Those numbers do not include the full potential benefit of the ASGE guidance change on INDOCIN or our Spectrum acquisition.

In the first quarter, INDOCIN's volumes are flat with the prior year quarter. Yet net product sales increased 42%. 98% of this growth was from the channel strategies we executed in the fourth quarter last year, where we have dramatically improved our gross to net on this product by eliminating non-commercial discounts.

We've also begun to roll out awareness campaigns about the recent guideline changes from the American Society of Gastrointestinal Endoscopy, or ASGE. The first was an email campaign in mid-April, which was well received, but it's too early to see if the additional awareness has or will change any behavior.

We also recently attended an important medical conference this last weekend to conduct some advisory boards as we plan our next effort, which is to sponsor continuing medical education program that is expected to launch in July.

We've increased our outlook for INDOCIN slightly in our revised guidance based on trends, but it's still too early to say definitively if there will be a material increase in demand as a result of the change in treatment recommendations from the ASGE.

We remain focused on our life cycle extension efforts for INDOCIN, primarily our label expansion strategy for the prevention of pancreatitis and ERCP procedures.

We announced the appointment of Dr. Howard Franklin, our SVP of Medical, in early March, Dr. Franklin has been busy working with the biostatisticians and incorporating the feedback we received from our pre-IND meeting with the FDA. We now believe that we need to go back to the FDA and seek some clarification through a Type D meeting request before filing the IND. This will delay the IND submission. However, based upon our revised timelines, we still expect the IND approval sometime later this year, and we still have the same expected $3 million to $4 million of clinical spend in the back half of this year included in our adjusted EBITDA guidance as we did last quarter.

Sympazan is performing well so far with the expanded promotional reach and frequency from our non-personal platform. In our first full quarter with the product, we achieved record quarterly prescription demand. Looking at TRx count, as measured by Symphony Health, we beat the previous record in the third quarter of 2022 by 1.5% and beat the prior year quarter by 7.3%. The march 2023 TRx count was also a new monthly high, beating the previous peak in August of 2022 by 2% and the prior year month by 8.2%. While one month does not make a trend, this new high is important since the comparison is to a peak before the sales force disruption and transition to non-personal promotion.

In addition, are ex-factory shipments this quarter were 7% above the previous peak and we're starting to see a mix shift towards the higher strengths, which come at a higher ASP, further benefiting revenue growth.

I'm sure our friends at Aquestive who developed this drug will agree that, to date, we're just scratching the surface of this drug's potential. As we continue to learn more about this market and the role Sympazan can fill, we're getting more excited about its potential. We'll give investors more clarity on what we think that potential could mean as we improve and refine our longer term plans for the product.

And finally, turning to our pending acquisition of Spectrum, which released the results for the quarter earlier today. They reported 54% sequential sales growth to $15.6 million in the first quarter. That team is clearly doing a tremendous job with the launch of ROLVEDON.

What's great about that number is that, if integrated under Assertio's platform, ROLVEDON is now recording revenue at an annual run rate that would be nearly breakeven for adjusted EBITDA since we expect to only bring over approximately $60 million of operating expenses from legacy Spectrum.

Our number one priority is a meticulously planned integration of Spectrum into Assertio after close to ensure the continued successful launch of ROLVEDON. The combination of these two companies increases the business development opportunities we can pursue and effectively commercialize.

Our business environment has been moving more towards one of contracting and market access, as contrast to the historical share of voice. And both Spectrum and Assertio have positioned themselves in this manner. Combined, we're stronger than apart, now with both digital and personal promotional execution.

We believe that oncology is an area that is both receptive to non-personal communication and has many assets that fit our objectives of size, growth potential, patent protection and exclusivity. The oncology offices and clinics were almost forced to adapt to non-personal communication during COVID because of the immunocompromised nature of their patient populations and the importance of guidelines like NCCN in setting treatment algorithms.

There are many interesting patent protected commercial and late stage products in oncology and supportive care that are below the size of large pharma's purview. The combination of the two companies, doubling down on our contracting and market access capabilities and optimizing the strengths of each other's promotional platforms, is what opens the door to a larger M&A opportunity set.

With that, I'll turn the call over to Paul.

[Paul Schwichtenberg]

Thank you, Dan. This morning, I will review the financial highlights from our first quarter of 2023. For full details, please refer to the tables and financial statements in our earnings release and 10-Q.

Net product sales were $41.8 million for the first quarter of 2023 compared to net product sales of $35.5 million in the prior year quarter and $49.9 million last quarter. The increase in net sales versus the prior year quarter was primarily driven by INDOCIN and the addition of Sympazan, which more than offset the expected declines in Cambia and Zipsor.

INDOCIN family net sales in the first quarter increased by 42% over the prior year quarter, primarily due to a volume mix shift to more profitable channels. Otrexup and Sympazan combined net sales for the first quarter were $5.3 million. Sympazan achieved its highest quarter of unit sales volume in its history, as we are seeing a positive response to Assertio's digital promotion model.

Overall, portfolio net sales were up 18% versus the prior year quarter despite the Cambia loss of exclusivity on January 1.

Gross margin as a percentage of product net sales was 86.9% in the first quarter versus 88.2% in the prior year quarter. The decline in margin was partly due to a shift in product sales mix as a result of the Cambia loss of exclusivity, along with a one time inventory reserved recorded in the quarter. We continue to remain focused on profitability across the portfolio and we expect gross margins remain in the high 80s throughout the remainder of 2023.

Adjusted EBITDA for the first quarter was $25.6 million compared to $33.4 million last quarter and $23.9 million in the prior year quarter. The year-over-year increase was driven by $6.2 million of additional product net sales, partially offset by higher selling, general, administrative expenses due to increased sales and marketing expenses for Otrexup and Sympazan.

Adjusted EBITDA margin, reflected as a percentage of total revenue, in the first quarter was 60.3% versus 65.3% in the prior year quarter.

The first quarter non-GAAP adjusted earnings per share was $0.29 versus $0.32 in the prior quarter and $0.38 in the prior year quarter. Please note that earnings per share is calculated using diluted shares, including the if converted impact of the convertible notes as is required under GAAP. The full weighted additional diluted share impact is 14.5 million shares in the first quarter.

Adjusted selling, general, administrative expenses in the first quarter were $11.9 million compared to $11.1 million last quarter and $9.5 million in the prior year quarter. The increase versus the prior year quarter is primarily due to additional costs for both Sympazan and Otrexup along with personnel costs due to new headcount additions.

Net loss for the first quarter was $3.5 million compared to net income of $88.6 million last quarter, which included an $80.4 million tax benefit and $9.1 million in the prior year quarter. The first quarter net income was impacted by $9.9 million of expenses related to the convertible debt exchange, a $7.5 million non-cash increase and contingent consideration associated with future INDOCIN royalties as a result of continued sales growth and increased operating expenses, primarily reflecting $2.4 million in transaction costs associated with the acquisition of Spectrum Pharmaceuticals as announced on April 25, 2023.

Net cash provided by operating activities as reported in the company's statement of cash flows for the first quarter was $22.7 million versus $26.7 million last quarter and $27.4 million in the prior year quarter. The year-over-year decline in operating cash flow is due to an income tax receipt of $8.3 million in the prior year quarter, partially offset by improved financial performance versus the prior year.

This quarter, like those that have come before it, shows the continued cash generation power of the business and the quality of our reported adjusted EBITDA measure in predicting the cash generated by the business.

Ending cash on March 31, 2023 was $68.6 million, reflecting a $3.7 million increase versus the prior quarter despite making a $10.5 million cash payment in conjunction with the convertible bond exchange that was executed during the quarter. This convertible bond exchange will save the company $2 million in annual interest payments.

On March 31, 2023, our long term debt balance was $38.2 million, reflecting the $40 million of convertible debt balance less unamortized debt issuance costs.

Lastly, our updated annual guidance for 2023 is as follows. Full year product net sales are expected to be $157 million to $167 million and adjusted EBITA is expected to be $90 million to $98 million.

Our updated guidance for the full year 2023 incorporates the Q1 actual results and reflects the following factors. One, favorable INDOCIN price due to continued volume in more profitable channels and higher volume for INDOCIN, partly due to the updated ASGE guidelines. And two, higher Sympazan volume due to the initial success of our digital marketing activities.

This guidance does not include the financial impact resulting from the recently announced acquisition of Spectrum Pharmaceuticals. Our guidance will be updated after the transaction closes sometime in the third quarter.

It is again worth noting that, because of our commercial execution and strategic actions in 2022, our 2023 updated guidance reflects a net product sales increase over 2022 despite the loss of exclusivity on Cambia, which was our second largest product.

The first quarter results once again show the positive impact of our commercial and operational execution, and we look forward to the transaction close and integration of Spectrum later in the year, which we expect to further strengthen our results, provide product diversification and continue Assertio's journey toward long term sustainable growth.

And now, I'll turn the call back over to Matt.

[Matt Kreps, Darrow Associates, Investor Relations]

Thank you, Paul. At this time, we've completed our prepared remarks from the management team, and we'll take questions from our research analysts and institutional investor community. Operator, can you please provide the instructions for Q&A from our listeners?

[Operator]

[Operator Instructions]. And your first question comes from the line of Thomas Flaten with Lake Street Capital Markets.

[Thomas Flaten, Lake Street Capital Markets]

Congrats on the quarter. Dan, I was wondering if you might be able to provide some more color on the upcoming meeting that you're going to request from FDA. Was there something in particular you saw there? Just wondering if you could give some color on what you're looking for input on from FDA.

[Dan Peisert, President and Chief Executive Officer]

It's us providing them with additional information to see if we can avoid some of the things in their original IND feedback. One of those specifically would be – we do not or would not like to do the dose ranging that they had suggested. So we're going to be providing them with some additional information to see if we can eliminate that from the clinical trial design, which would allow us to enroll and complete it far quicker.

[Thomas Flaten, Lake Street Capital Markets]

Switching over to Sympazan, I'm just curious, on a kind of a same store sales basis, is the growth you're seeing from traditionally productive accounts or are you seeing any impact from maybe non-touched accounts under the Aquestive model?

[Dan Peisert, President and Chief Executive Officer]

I don't have any information on that. Do you, like on existing prescribers?

[Paul Schwichtenberg]

I don't have any specific information.

[Dan Peisert, President and Chief Executive Officer]

We can get back to you on that, Thomas. We'll check with our sales team on that.

[Thomas Flaten, Lake Street Capital Markets]

Finally, I think you guys have your AGM tomorrow. And is it safe to assume that the merger vote will happen at that meeting? And then secondly, any insight into when Spectrum might be planning their AGM? I think last year was in June,

[Dan Peisert, President and Chief Executive Officer]

The AGM is not going to address the Spectrum acquisition. It's just the information that was in the proxy that was provided to shareholders in April. We will be submitting a new S-4 here in the coming weeks. That is in combination with Spectrum. And we will be having a shareholder vote in the late July, early August timeframe.

[Operator]

Your next question comes from the line of Scott Henry with ROTH Capital.

[Scott Henry, ROTH Capital]

Congratulations on a quite a run these past couple of years. I did have a couple questions. First, I guess I'll start with the income statement. The SG&A number, you talked about why it was a little higher in the quarter. My question is, was there any one-time noise in there? Or is that kind of the number we should think about going forward?

[Paul Schwichtenberg]

Scott, there were a couple of differences in the quarters. There was a one-time charge, as I mentioned, related to the Spectrum acquisition. And then the other is just the timing of stock based comp. The annual grant this year was in February, last year was in May. So there's a little bit of a timing difference there that's driving it. And then the rest is going to be the sales and marketing expenses that I mentioned related to Otrexup and Sympazan.

[Scott Henry, ROTH Capital]

Shifting gears, ROLVEDON, it looks like a really good quarter for Spectrum. As far as you know, and I know it's not your product right now, was that a clean quarter, meaning is there any stocking in there? Or is that a pretty good demand based quarter for where the launch is at currently?

[Dan Peisert, President and Chief Executive Officer]

From what we know of it, from conducting diligence, it's a good clean quarter that reflects demand.

[Scott Henry, ROTH Capital]

Could you talk about what kind of gross margins we should expect for ROLVEDON, at least relative to your current business?

[Paul Schwichtenberg]

The ROLVEDON gross margins I think are going to be in the high 70s, 80% range. I'm sorry. Let me let me clarify that point. I'm sorry, mid 80s is going to be the margins on ROLVEDON.

[Scott Henry, ROTH Capital]

Shifting gears, Sprix, how should we think about that? Not just this year, but next year and the following year. How do we think about that franchise from a growth standpoint?

[Scott Henry, ROTH Capital]

It's clearly product four on our list, but it requires a heavy lift. There's a lot of things that need to be done in what I call break medical inertia. And think about this one a little bit differently. We need the number one thing that we need to do to improve sales here is improve market access. It's got very poor coverage today. I think less than 15% of covered lives – or lives are covered for this product. So it's incredibly important if you're going to be getting an acute pain med that it be reimbursed and paid for. So we've got a very effective, I guess, patient access program in place. However, it also becomes expensive if you start growing the product. So we need to look for things that are outside the traditional routes to increase coverage for the product. Some of the things that we're exploring also include a price decrease for that product. So we haven't come up with all the answers yet, Scott, but right now, it's been bouncing in us what roughly…

[Operator]

Sorry, Mr. Peisert, your line cut out.

[Technical Difficulty]

Please continue.

[Dan Peisert, President and Chief Executive Officer]

Sorry about that everyone. We had a little technical difficulty. Our equipment shut down.

[Operator]

Your next question comes from the line of Mayank Mamtani with B. Riley.

[William Wood, B. Riley Securities]

This is William on for Mayank. Congratulations on a great quarter as well as your recent Spectrum acquisition. A couple of questions from us. Maybe when thinking about continuing the early impressive growth of ROLVEDON going forward, could you discuss your strategy for maintaining the growth of your targeting clinics, 340B and then the non-340B hospitals and how do you view having a J-code in place will make you more competitive in your execution? And then one follow-up.

[Dan Peisert, President and Chief Executive Officer]

We don't anticipate doing anything different. The targeting that they've done, we think is right on point. And if anything, what we intend to do is help them reach a broader number of clinics sooner and without increasing additional operating expenses. So by pairing their in-person promotion with our non-personal platform, we think we can target a far greater number of clinics than just what you're limited to by geography with the current salesforce that they have. So, right now, we don't intend to do anything different.

The J-code, we think it facilitates reimbursement and makes things easier. So we were very excited to see that went into effect on April 1 And we're really looking forward to closing this acquisition, so we can help them up.

[William Wood, B. Riley Securities]

Just in regards to your CDR related milestones for 2024 and 2025, just curious if your level of confidence on meeting these. And also, could you remind us if there's is a CDR or a milestone for 2023 that's in place.

[Dan Peisert, President and Chief Executive Officer]

There is no 2023 milestone. And we're not going to be giving forward-looking guidance or confidence for what we think this product can do in 2024 or 2025 at this point.

[Operator]

Your next question comes from the line of Hamed Khorsand with BWS Financial.

[Hamed Khorsand, BWS Financial]

So the first question I had was about INDOCIN, and is it still too early for you to see what the kind of impact or benefit this new guideline from ASGE is having for you?

[Dan Peisert, President and Chief Executive Officer]

Yes, it is. It's too early to see it. So we still see the product performing inside of statistical control, what it's been doing the last 24, 36 months.

[Hamed Khorsand, BWS Financial]

And what's driving the Sympazan sales increase for you? Is that because of what you have undertaken ever since you acquired it or was that in place before you acquired it, the success it's seen?

[Dan Peisert, President and Chief Executive Officer]

The product had been on a growth trend, but it was slowing as they were essentially losing reps. And then I believe they exited the salesforce in the September timeframe. So to see it actually perform well and hit hold in there without much disruption and then start to set new quarterly and monthly peaks here in the first quarter was incredibly encouraging. And so far, all signs are that the increased reach and frequency of our promotion is starting to drive awareness and uptake of the product. So we're excited about what we can do with this.

[Hamed Khorsand, BWS Financial]

My last question was just about having the Otrexup samples in Q1. it How does that build momentum for you going into Q2? And are you expecting any momentum in sales for Otrexup now that you have samples available?

[Dan Peisert, President and Chief Executive Officer]

It's certainly going to help. What I can tell you is I've been actually pretty pleased with the first couple of weeks of April that we have data on. It's not going to double this product or anything by any means. But it has been coming in, at least the first couple of weeks in April, a little bit ahead of our trends. Volumes were fine, a little bit better in the first quarter, but it was a gross to net hit. Most of those volumes came in more discounted channels.

[Operator]

Your next question come is a follow-up and comes from the line of Scott Henry with ROTH capital.

[Scott Henry, ROTH Capital]

Just a couple of very technical questions around the merger. You may not have the answers, but given that it's a merger, will there be any amortization expense here that will be added on from this transaction?

[Paul Schwichtenberg]

There should be. But I don't have a good handle on what it will be. We can give you that later, Scott.

[Scott Henry, ROTH Capital]

I assume we'll get that post the transaction. And then as well, I'm looking at putting out –doing a joint model for the company, even though the vote still has to happen. When we think about total shares outstanding, it looks like we should be thinking about $110 million. Am I in the ballpark there?

[Paul Schwichtenberg]

Just to give you the high level, as it stands right now, we have 55.6 million shares outstanding as of March 31. I can't give you the exact share count that's going to – or the increase in shares that's going to result from the merger. That will be released when we release our S-4. But very big picture, you could take the Spectrum outstanding shares and divide it by the exchange ratio to get an estimate of what those additional shares will be.

[Scott Henry, ROTH Capital]

And add that on to your fully diluted?

[Paul Schwichtenberg]

Correct.

[Scott Henry, ROTH Capital]

I guess just final question, company is making money pretty regularly now. How should we think about – not in 2023, but in 2024, do expect it to be taxed at around 24% at that point, assume you take a gain on any tax losses you still have, how should we think about that kind of next year?

[Paul Schwichtenberg]

Scott, from a cash tax rate – effective tax rate perspective, we're expecting it to be around 10% to 12%, kind of low double digits. Obviously, our book tax rate is going to be the federal and state combined rate of 25%.

[Operator]

Your next question comes from the line of Mitra Ramgopal with Sidoti.

[Mitra Ramgopal, Sidoti & Company]

Congrats on a strong start to the year. Dan, you certainly checked all the boxes in the two plus years you've been there. So it's been a great job. And I look forward to that continuing. Just a couple of questions around the Spectrum Pharmaceuticals transaction. And might be getting a little ahead of myself here, but do you plan to use their sales force to also sell your products? Or would it be strictly for ROLVEDON?

[Dan Peisert, President and Chief Executive Officer]

No, it's going to be strictly for ROLVEDON. We don't want to do anything to impact that launch. We might be able to find – we've already got some ideas of other products that we can acquire in the future that would fit with them. I think the initial people that would likely be able to help both sides of the house from the Spectrum side would be their market access, the contracting folks that work with both the payers as well as the clinics. I think I see a good potential overlap between what they're doing and what we're trying to do in our business.

[Mitra Ramgopal, Sidoti & Company]

And it sounds as though this is certainly the biggest deal you're doing since you took over, business model changing a little, et cetera. It seems like there might be some heavy lifting near term. But at the same token, you sound pretty interested in pursuing additional BD opportunities. Is that fair?

[Dan Peisert, President and Chief Executive Officer]

It's fair. But don't get me wrong, number one priority is making sure there's a successful integration of these two companies. So we're not going to do anything to distract either team from that. That's going to be the critical success factor for us this year.

[Mitra Ramgopal, Sidoti & Company]

Again, it seems just from the guidance, the underlying business remains – it's in good shape. And obviously, adding on Spectrum is a game changer. Any potential headwinds we're missing here or is it pretty much under control right now from your standpoint, just executing on a transaction, etc.?

[Dan Peisert, President and Chief Executive Officer]

There's not any headwinds that we're aware of. We've been pretty keen at it steering clear of them. So there might be turbulence upcoming, but we don't see any of that right now.

[Operator]

There are no further questions at this time. So this concludes our question-and-answer session. I would like to turn the conference back over to Dan Peisert, President and Chief Executive Officer, for any closing remarks.

[Dan Peisert, President and Chief Executive Officer]

Thank you all for participating in our call today. I look forward to seeing many of you in our upcoming trip to New York and Boston next week with ROTH Capital and at the Craig-Hallum conference in Minneapolis at the end of this month.

If you'd like to set up a meeting with us, please contact Matt Kreps at Darrow. As a final note, I'd like to congratulate the Blackhawks on getting the first pick in the NHL draft. Go Hawks.

[Operator]

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