Rollins Inc
NYSE:ROL
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Rollins Inc
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Greetings, and welcome to the Rollins Incorporated Third Quarter 2020 Earnings Conference Call. [Operator Instructions]
I’d now like to turn the conference over to your host, Joe Calabrese. Please go ahead sir.
Thank you. By now, you should have all received a copy of the press release. However, if anyone is missing a copy and would like to receive one, please contact our office at 212-827-3746 and we will send you a release and make sure you are on the company's distribution list. There will be a replay of the call, which will begin 1 hour after the call and run for 1 week. The replay can be accessed by dialing 1-844-512-2921 with a pass code 13710819. Additionally, the call is being webcast at www.viavid.com, and a replay will be available for 90 days.
On the line with me today and presenting are Gary Rollins, Rollins' Chairman and Chief Executive Officer; John Wilson, Rollins' Vice Chairman; and Eddie Northen, Senior Vice President, Chief Financial Officer and Treasurer. Management will make some opening remarks, and then we'll open the line for your questions.
Gary, would you like to begin?
Yes, Joe. Thank you. Good morning. We appreciate all of you joining us for our third quarter 2020 conference call. Before turning the call over to Eddie to read our forward-looking statement and disclaimer. First, I want to take a moment to recognize the recent passing of our former Chairman and my brother Randall Rollins. Randall was an extraordinary human being and his accomplishments and contributions made at the various Rollins public and private companies over the years are unequal. He is missed greatly, not only by our family and his friends, but also by generations of Rollins employees and colleagues who he respected so highly. Many of you reached out with condolences upon receiving the news of his death. And I'd like to thank you for having our family in your thoughts, as well as for your kind words.
Eddie, would you please read our forward-looking statement and disclaimer?
Yes. Our earnings release discusses our business outlook and contains certain forward-looking statements. These particular forward-looking statements and all other statements that have been made on this call, excluding historical facts are subject to a number of risks and uncertainties. And actual risks may differ materially from any statement we make today. Please refer to today's press release and our SEC filings, including the risk factors section of our Form 10-K for the year ended December 31, 2019 for more information and the risk factors that could cause actual results to differ.
Thank you, Eddie.
Looking at our third quarter performance, we were pleased to report another solid result. And we remain proud of our planned execution across all of our business service lines.
Revenue grew 4.9% to $583.7 million compared to $556.5 million for the same quarter in 2019. Net income rose to 79.6 million or $0.24 per diluted share, compared to $44.1 million or $0.13 per diluted share for the third quarter of last year. Eddie will review the GAAP and non-GAAP results shortly as they were meaningful adjustments impacting our financials.
Revenues for the first nine months of the year were $1.62 billion, an increase of 7.6% compared to $1.51 billion for the same period last year. Net income for the first nine months increased to $198.2 million or $0.60 per diluted share compared to $152.6 million or $0.47 per diluted share for the comparable period last year. Again, Eddie will review these and our nine-month non-GAAP results in a few minutes.
Turning to our business lines results, residential pest control grew 10.5% during the quarter, reflecting the resiliency of the service and its strong demand. As anticipated, our commercial operation revenue was down year-over-year as commercial pest control continues to be negatively impacted by the COVID-19 virus and its related economic tool.
However, some businesses reopened during the quarter and for some of these customers, their economic conditions improved. We've continued to narrow the revenue shortfall gap each month since April. Overall, we were pleased with the steady progress we've achieved under those circumstances. John will provide greater detail on these and our other operational results shortly.
Overall, our people and business continue to perform well and what remains a complex environment. We have an unwavering commitment to keep our employees and customers safe.
Our team's continued dedication in serving our customers has been outstanding. They are truly our greatest asset and we're grateful for their efforts. Further our commitment to safe practices involved our employees and customers as well. We continue to benefit from the high regard trust and confidence that our customers have in us.
Before turning the call over to John, I also want to acknowledge some recent key advancements that further strengthen our executive leadership. John Wilson, as many of you know through his involvement on our earnings conference calls and investor meetings, was promoted to the company's Vice Chairman.
John joined the company in 1996 and has been an integral part in developing and executing [indiscernible] and strategic initiatives over the years. His promotion is truly a testament to his leadership, work ethic and talent.
Additionally, Jerry Gahlhoff was promoted to Rollins, President and COO. Since many of you may not be too familiar with Jerry's background, I'd like to take a minute and highlight a few of his many accomplishments.
Jerry started his career in the pest control industry in 1991 and came to Rollins in the HomeTeam acquisition in 2008. He's successfully managed several areas of the company and has been instrumental in guiding meaningful growth and profitability in these businesses. He most recently led what we refer to as the Rollins specialty brands team, which includes HomeTeam pest defense, Clark pest control, Northwest Exterminating, Western Pest, Waltham Pest, and OPC Services, as well as our very important Rollins human resources department and training department.
A seasoned executive and well-respected industry leader Jerry has a comprehensive understanding of our organization, business and is extremely well suited for the COO position. Another little known fact is that Jerry came from an Orkin household as his dad was a 26-year employee.
We're fortunate to have John and Jerry assume a greater role in our company, it's direction and it's future. We look forward to their continued contributions.
Let me now turn the call over to John who will provide more details on the aspect of our third quarter. John?
Thank you, Gary. I am excited and grateful for the opportunity to be here. I wanted to start by providing some context to the current environment. While the Coronavirus remains prevalent in many areas, we feel positive about our financial performance this quarter, and how we're executing as a company to meet the needs of our residential and commercial customers, both in the U.S. and abroad. Our residential business remains solid, our call centers are busy and we are pleased with our results from this service line. We are also encouraged, yet at the same time, cautiously optimistic about the positive trends we've been seeing on the commercial side of our business.
As Gary noted, our third quarter commercial results were down year-over-year. However, the operating environment steadily improved as third quarter progressed and we continue to see month-to-month improvements as more businesses reopened and the trust that our brands have built over time, have enabled our technicians to provide service when and where needed. Still, we are by no way thinking that this pandemic is over. We remain diligent considering the current operating environment, and with many experts projecting that another wave is possible, there remain many uncertainties. We're executing against our plan and continue to proactively navigate the best path forward.
For example, out of concern for the health of our employees, as well as our customers, stringent safety practices are ongoing and remain a top priority. To keep our technicians safe, we continue to adhere to the advanced health and safety protocols as recommended by the CDC.
By providing a full complement of personal protective equipment for our customer facing employees, we're continuing to build trust with our customers, while also demonstrating it is safe to do business with us.
We are also working with our customers to create a safer environment for where they live and work. As we have discussed Orkin and many of our other brands are now offering a commercial and residential disinfection service, which is effective and quickly and thoroughly eliminating a wide variety of serious pathogens. While it is still early, we're pleased with a very positive reception this new service line has been receiving from existing as well as new customers.
During the third quarter we steadily grew this new offering. Additionally, investors have asked us about the business impact of the devastating wildfires out west, as well as the recent tropical storms and hurricanes that have made landfall in the U.S. While our hearts go out to those that have been adversely affected by these natural disasters, up to now we have not had any significant business disruption.
I would also like to take a minute to provide an update on our wildlife brand, which has experienced strong double-digit growth year-to-date. For those of you who aren't too familiar with this business segment, the services we provide include life trapping and removal of wildlife, exclusion of wildlife from residences and other buildings and the repair and remediation of damages caused by wildlife. There is not a more urgent call for help than that customer who has a wild animal loose in their home or business.
Although a small part of our total business, we have firmly established our position as the leading wildlife control provider in North America. And looking ahead, we believe that this is real opportunity to continue to grow this business.
Lastly, I wanted to circle back to the promotion of Jerry to President and Chief Operating Officer. Not only does he have a strong foundation in the pest business, he does have a degree in entomology after all. He is that rarest of individuals who knows both bugs and the bug business inside out. He works very hard at improving himself each day. And I've watched him over the last 13 years, improve every operation he has touched. I am excited to have Jerry in this new role.
I'll now turn the call over to Eddie.
Thank you, John. I believe at every reference it could be made regarding how long the last quarter has been has already been used, so I'm going to spare my attempt.
I would like to pass along my thanks to your outreach regarding our late Chairman. Your words of reflection and support were truly appreciated.
In 2016, we held our first ever Investor Day in New York City, and our team had a chance to get to know many of you on that day. The primary reason for holding that event was to share the depth and breadth of our senior management team. I've had discussions with many of you over the years about the eventual passing over the time and the elevation of Gary, John and Jerry show this in action. Each of them had been well prepared for years to take their perspective and vision to lead Rollins for years to come. We're fortunate as an organization, and as investors, I believe that you will be pleased with what the future holds.
The obstacles that impacted Q2 began to subside and our operations and non-operations groups had make tremendous adjustments to the new life that we are all leading. Today I'll share some details on our Q3 actual results and some additional insights to what we know today that will impact the future.
For the quarter, our residential pest control and termite service lines showed growth and key to the quarter included improvements in commercial revenue growth rates compared to the second quarter impairment charges related to our personal protective equipment, also known as PP&E. And the successful continued cost management implemented to drive margin improvement year-over-year.
As Gary referenced, I will be reporting both GAAP and non-GAAP financials that were impacted by vesting of shares this year and the impact of the pension plan moving off of our Rollins book in Q3 of 2019.
Looking at the numbers, the third quarter revenues of $583.7 million was an increase of 4.9% over the prior year’s third quarter revenue of $556.5 million. Our GAAP income before income taxes was $108.9 million, or 136% above 2019. Net income was $79.6 million up 80.6% compared to 2019. Our GAAP earnings per share were $0.24 per diluted share.
On a non-GAAP basis, our income before tax was 115.6 million this year compared to $96 million last year, a 20.4% increase. Our 2020 income before taxes was impacted by $6.7 million for the vesting of our late Chairman’s Rollins shares.
Additionally, 2019 was reduced by $49.9 million for the vesting of the pension plan off of our Rollins books. Both the vesting of shares and pensions divesting were non-cash items, Our non-GAAP net income was $86.3 million this year, compared to $70.6 million in Q3 of 2019, a 22.1% increase.
Looking at the first nine months revenue of $1.625 billion that was an increase of 7.6% of the prior year's third quarter revenue of $1.509 billion. Our GAAP income before income taxes was $267.8 million or 41.6% of 2019. Net income was 198.2 million up 29.9% compared to 2019.
Our gap earnings per share were $0.60 per diluted share. Our non-GAAP financials taking the share vesting and pension plan into consideration were income before taxes of $274.5 million up 14.8% and net income was $204.9 million this year compared to $179.2 million in 2019, a 14.4% increase.
Our non-GAAP earnings per share for the nine months were $0.63 compared to $0.55, which is a 14.5% increase. As we stated on our Q1 and Q2 calls, we began aggressively purchasing personal protective equipment in March and April. While these were costly, they were critical to keeping our operations running safely. As the cost of these materials have moved lower from the peak, we took a $2 million one-time charge to revalue our inventory.
With the pricing moving lower, we anticipate spending $1 million per quarter down from the $2 million that we shared on previous calls. At this time, we would anticipate having this additional expense for Q2 of 2021.
Let's take a look through the Rollins revenue by service lines for the third quarter.
Our total revenues increased 4.9% that included 1.4% from acquisition and the remaining 3.5% was from pricing, which is a small portion of that but mostly from organic and new customer growth.
In total residential pest control, which made up 47% of our revenue was up 10.5% commercial ex-fumigation pest control, which made up 34% of our revenue was down 1.9% and termite and ancillary services which made up approximately 18% of our revenue was up 6.2%.
Again, total revenue less acquisitions was up 3.5% and from that residential was up 9%. Commercial ex-fumigation decreased 3.7% and termite ancillary grew by 5.9%. Our residential business continues to perform well and the business on the commercial side has seen steady improvement each month since April. While we continue to manage our costs appropriately, it's difficult to know how the revenue levels will look as we move through the pandemic, with restrictions continuing to change throughout the world.
In total, gross margin increased to 52.8% from 51.7% in the prior year's quarter. The quarter was positively impacted by lower service and administrative salary expenses, as well as lower fuel expense and continued improvements from our routing and scheduling efficiencies. Additionally, materials and supplies were up as I referenced related to the inventory, revaluation of our personal protective equipment.
Depreciation and amortization expenses for the quarter increased 714,000 to $22.4 million an increase of 3.3%. Depreciation increased $1 million due to acquisitions, vehicles acquired and equipment purchases, while amortization of intangible assets decreased 286,000 due to the full amortization of customer contracts from several acquisitions including HomeTeam and tuck-ins related to Orkin.
Sales, general and administrative expenses for the third quarter increased 838,000 or five tenths of a percent to $168 million or 28.8% of revenues down from 30% last year. The quarter produced savings in salaries and benefits, lower fuel and bad debt through better collection efforts.
As for our cash position for the nine-month period ended September 30, 2020, we spent 79.9 million on acquisition compared to 431.2 million the same period last year, which included the acquisition of Clark Pest Control. We paid $91.7 million on dividends and had 17.7 million of capital expenditures, which was slightly lower compared to 2019.
We ended the period with $95.4 million in cash of which 62.9 million is held by our foreign subsidiaries.
Before I close, I would like to give an update on one of our sustainability initiatives, particularly as it relates to our local communities. Through corporate and brand initiatives such as Rollins United and Northwest Good Deeds Teams, Rollins employees across all brands are strongly encouraged to volunteer within our local community.
In 2021, our employee volunteered goals include community cleanup efforts, trafficking, education awareness, literacy programs and support of the United Way to name a few.
Rollins has committed to giving back to our communities through a strong philanthropic vision. Please go to rollins.com under the Investor Relations tab to view the full 2020 sustainability report.
Yesterday, the Board of Directors approved a large regular cash dividend of $0.08 per share, plus a special dividend of $0.13 that will be paid on December 20, 2020 to stockholders of record at the close of business November 10, 2020.
In addition, they also announced a three for two stock split that will take effect December 10, 2020 for stockholders a record at the close of business, November 10, 2020.
Gary, I'll turn the call back over to you.
Well, thank you, Eddie. We're happy to take your questions at this time.
Thank you. At this time, we'll be conducting a question-and-answer session. [Operator Instructions] The first question is from Tim Mulrooney, William Blair. Please go ahead, sir.
Good morning to Gary, my condolences once again to you and your family on the passing of your brother.
Thank you.
Yes. Just a few questions this morning. On the last conference call, Eddie, you mentioned that you hit 10 out of 10 record new sales days in June and July. Now, how did your new sales trend through August and September does it remain elevated or did you see a return to more normalized sales patterns as you exited that peak selling season?
Yes, Tim. Thanks. Yes, we didn't highlight that today. And I don't know if we necessarily duplicated that that number that we had shared before. But I think based on what we reported as far as the revenue gains, you can see that they were elevated especially on the residential side. And our call center did the much higher activity, has seen in previous years, even as we started to come out of the season and move into some cooler areas, as we've seen.
Again, the majority of that was on the residential side. But we have seen incremental improvements on the commercial side as well, for some of the smaller businesses that would come through our call center for that.
Okay. That's helpful. Thank you. On the margins, EBITDA margins were particularly strong this quarter, nearly 24%. Is there any way for you to quantify for us how much of this is from the temporary cost cuts that you implemented earlier this year? I'm trying to figure out how much of this expansion in margin we've seen recently a structural from your routing and scheduling, for example, versus how much of this is more of a temporary dynamic?
Well, there's no question that routing and scheduling is paying great dividends for us now, especially as we're having to have technicians potentially adjust and change some routes that they maybe would have historically run on both sides, on the residential as we're growing gives us the ability to be able to do that smoothly. And on the commercial side, it allows us to kind of reduce some of the noise that we would have by being able to schedule.
We had one of the best quarters, which we didn't go through in detail. We had one of the best quarters as far as year-over-year, stops per mile improvement in the quarter, which is positive. And I think those types of things to the point of your question are more structural in nature. I believe that the majority of the folks that we had furloughed, as we went into the pandemic that are going to be brought back, had been brought back at this point in time. And I think that our both our operations and our non-operations groups absolutely are leaner than when we started. We've been forced to find ways as many organizations have to use technology in ways that have made us more efficient.
So I don't have a defined answer and exact answer for you. We will be leaner and margins will be better as a part of this as we're moving forward. But I think as we see that revenue growth we'll get a more and better and clear answer to that.
The good news is from Q2 to Q3, we continue to see those margins positively impacted, even as we've had more revenue on the residential side and even more revenue on the commercial side, come back into the business.
Okay. And what I think you pretty much did answer…
Excuse me, this the operator only two questions per participant, and then you can reenter the question queue after that. The next question is from Seth Weber, RBC Capital Markets. Please go ahead, sir.
And I'd also like to extend my condolences to everybody there. I want to ask about the commercial business. You mentioned that trends improved sequentially month-to-month. And I was just wondering, I think you said for the quarter, organic was down about 3.7. Can you just talk about, did it end up with September in positive territory in the commercial side? Or is that still trending negative through September? Thanks.
Yes. I think we're still negative. We have a few different operations that have some heavy concentration in areas that are the most impacted right now. And we have a heavy concentration in New York City area, those of you that are there around that area know and understand the impact of what's going on there. But we're definitely seeing improvements in other areas that have been an opportunity to open back up and as businesses have been able to make those decisions.
And our sales group continues to do a good job looking and working on those verticals, where we know that there's less impact. On the healthcare side and on logistics and those things like that, they continue to do a nice job, but in those areas. So positive improvements, but I wouldn't say that we're positive quite yet.
Okay. And then, a follow up on that, I think I heard in some of the SG&A discussion that bad debt expense actually got better. Can you just talk about your collection efforts and what kind of trends you're seeing on the commercial side with respect to any kind of customer pain or just extensions that are happening on the commercial side specifically on the collections? Thanks.
On the collection side, on the residential side is where we saw our improvements that occurred. And those were in our larger brands and if you think about our larger brands that are going to have residential bases -- large residential bases, our Orkin brand or HomeTeam brands, our Clark brand, all have larger residential bases. And we were able to see improvements there.
On the commercial side, obviously, that continues to be a struggle, we made adjustments to payment terms, mostly in Q2 with our customers that we made the decision to do that with, we really didn't have a lot of new customers in Q3 where we request and we made adjustments for that. But the high profile bankruptcies that you read about that we read about a lot of those, in cases, our customers. So we've worked really diligently to minimize our exposure in those areas. And the news for us there is that a lot of those customers that are on that bankruptcy list have been on that list for the past year, so well before the pandemic occurred, as they were on our watch list, we were minimizing our exposure at that point in time. But the reality is the customers that are struggling to stay in business today are just working day-to-day and we're trying to work with them as a partner. But the collections on that side is slightly slower but on the residential side with a positive impact.
We have a question from Mario Cortellacci, Jefferies. Please go ahead, sir.
I'd also like to send my condolences to all of you and Gary and your family. I'm very sorry for your loss. My question is around the disinfecting business and specifically in commercial. I guess, could you give us a sense of what kind of uptick you're seeing there, how much uptake you're seeing from customers. And the reason why I'm asking is just to understand how much of the improvement in revenue and on the commercial side has been this offset from the disinfectant business versus having customers come back, either coming back, or increasing the amount of service that they're getting.
I'm sure John's going to have some comments that he'd like to add. But I would say if you look at those two categories, it would be more weighted towards customers coming back. But the disinfectant, the new services, in many of our brands has been a positive impact for us to be able to go through and add on the revenue side. What we see from the disinfectant side, customers that have had some sort of incident occur, that need to ensure that they have this taken care of and the cleanliness in their workplace, either for their customers or for their employees those are the ones that we have a shorter sales cycle for, and that one need to get something in place. Others that know, this is the right thing to do, but aren't necessarily under that same pressure, we had a little bit of a longer sales cycle. And we're learning as we continue to move forward. But it continues to grow for us. But I would say if you had to differentiate between those two, that we've had more incremental business that has come back.
Yes. You're exactly right, the impact from that of -- in Orkin, we call it bottle cleaner, various brands have different names that they're calling it as they go to market. But the impact of the gap for commercial revenue to a year ago is very small from bottle clean, most of it has been from customers returning to services, their needs change.
We don't have a lot of view of things that are kind of outside of our area where we are, as we know, most of us aren't traveling these days. We just know what our view is here in Georgia. And a lot of things have opened back up and are more close to what we knew before. And you contrast that with something like the New York City area where it is significantly different than what it was like before. So it's those pockets that are seeing those incremental improvements, that we're able to see customers come back and we're able to continue to be able to service them.
Could I add one thing, Eddie? We're very fortunate that that in most of our commercial accounts hospitality related, health related they can put the service off indefinitely. They know that the best will come back, the way they got started to begin with receiving merchandise from outside and so forth. So that's a positive thing that we're disappointed when they differ a service. But our experience has been is they will be back. And I think, our numbers have showing that.
Thank you. And then, just on M&A.
[Operator Instructions] The next question is from Mr. Michael Hoffman. Stifel, Nicolaus & Company. Please go ahead, sir.
Thank you very much. And like my colleagues, we wish your family the best, Gary.
Thank you.
Two questions I have are focused on organic growth and then on margins. On the organic growth side. we're noticing across the Stifel coverage broadly, that work from home is having interesting, positive -- mostly positive consequences. I point to like Pentair reported extraordinary pool numbers, and so on and so forth. Can you disaggregate the 9% and help us understand how much is being influenced by people all at home and so they're ordering maybe adding mosquito and tick and or that you spoke to the wildlife number, versus its net new customer ads, so we can understand the influence? And then what are your thoughts about how that starts to anniversary?
Yes. Thank you, Michael. We don't break out customers and things like that, I will tell you that we have had great new customer growth. But I can't really -- I don't know really know exactly, how much of this is being driven by someone at home that is adding the mosquito versus that they would want the mosquito. Our mosquito continues to grow at a 30% plus rate as it has for the previous few years. That's a little bit of a higher base. It's still a low base, but it's a little bit of a higher base of what we've seen previously. But we are seeing good new customer growth that has come out of this. Now, as far as, when it comes down to [indiscernible], can't answer that either just because we just don't know. We don't know that people continue to work from home, where we have situations where there's an additional need for more services. We anticipate that our retention of those customers will be higher, because, as we talked before, as we add an additional service, the retention of those customers improves for us. So as they add mosquito or as they add one of our other services, that retention rate does increase and [indiscernible] it in our Orkin brand that we've seen that across the board in all of our services there. So, big customer growth and probably the best that we can say at this point.
Okay. On the margin side between gross margins and then as a cost to SG&A. So the gross margin came down 100 basis points sequentially, which makes sense if you're bringing back furloughed people. We flushed out the sort of that returning a people issue. And then on the SG&A side, you clearly have shown a lot of discipline in the management of that in an absolute dollar basis, as well as percent of revenue. How much of that is annual accrual things that will come back versus is permanent?
I will take the first part of your question, I think we've pretty much moved through all the furloughed process that we had just a very small number, that would still be -- we could be making decisions on but I think Q2 we saw the majority that Q3. It's kind of moved through.
On the structural side on the SG&A, like I was answering earlier, we're leaner than we were when we went into this. We did have some positive impact that impacted through our bad debt. But we also saw very strong improvements in our administrative salaries, as well as our personnel related. So structurally on the people side, I think Q2 and Q3 we're seeing kind of similar trends there. And, we use technology to be able to make us better and be able to make us more efficient as we're moving forward.
We have a further question from Mr. Tim Mulrooney, William Blair. Please go ahead sir.
Hey, thanks for taking my next question. Eddie, I just wanted to follow up on your previous answer to me. The way you said that one of your greatest improvements and reduction of miles driven was this quarter. Is that due to anything that you're -- I guess doing differently or are your branches just becoming more mature? On the VRM system, I guess maybe I'm just looking for a general update on where you're at with your tech initiatives and rollout?
Yes. So yes, I would say two things and John's got something to add as well. I think two things to say. One maturity continues to move forward in time. As we continue to have retention of our technicians that's going to be a positive thing for us. But we had these four stages of routing and scheduling. And we're in this -- we're kind of in this phase two of this four stage and as we continue to layer on additional technology pieces that are kind of behind the scenes for the operation, that's going to continue to drive improvements. So I would say improvements will continue to be positive as we're moving forward.
Yes. I will add two things, Eddie, and the first one is very similar, but greater adoption, Tim, no doubt with our branch operations. But then also greater density with huge amount of residential customers, we've added commercial coming back. We just have greater density on our routes.
One other thing that we had to look forward too, we did not have all of our brands on our routing and scheduling.
That's right.
So we've got I guess what we're converting now –
[Indiscernible] converted, and then we have other brands that we're adding as well. But, yes you're right, as we talk about this four phases, that's exactly.
That's always a good time. If you have the people that want it, they adapt it so much quicker than a normal situation. You have to convince them.
Gary?
Okay. Well, thank you all for joining us today. We appreciate your interest in our company. As you've heard during the past calls, we have several programs underway that will make our company better, improve our customers experience and our financial results. We look forward to giving you an update with our fourth quarter call in the future. Thanks again.