GDI Integrated Facility Services Inc

TSX:GDI

Earnings Call Transcript 2020-Q4

[Operator]

Good morning, ladies and gentlemen, and welcome to the GDI Integrated Facility Services Fourth Quarter 2020 Results Conference Call. [Operator Instructions] Also note that the call is being recorded on Wednesday, March 3, 2021. At this time, I would like to turn the conference over to Stéphane Lavigne, Senior VP and Chief Financial Officer. Please go ahead.

[Stéphane Lavigne, Senior VP & CFO]

Thank you, operator. Good morning, everyone, and welcome to GDI's conference call to discuss our results for the fourth quarter and full year of fiscal 2020. [Foreign Language] My name is Stéphane Lavigne. I'm Senior Vice President and Chief Financial Officer of GDI. I'm with Claude Bigras, President and CEO of GDI; and David Hinchey, Executive Vice President of Corporate Development. Before we begin, I would like to make you aware that this call contains forward-looking information and we ask listeners to refer to the full description of the forward-looking safe harbor position that is fully described at the beginning in the MD&A filed on SEDAR last night. I will begin the call with an overview of GDI's financial results for the fourth quarter and the 2020 fiscal year-end, and then I will invite Claude to provide his comments on the business. In the fourth quarter, GDI recorded revenue of $264.7 million, an increase of $20.5 million or 6% over Q4 of last year, including negative organic growth of 4.2% due to the full or partial closure of certain client facilities as a result of the COVID-19 pandemic. We recorded an adjusted EBITDA of $32.2 million in the quarter, an increase of $11.4 million or 54.7% over Q4 of last year. Adjusted EBITDA was positively impacted by additional products and services delivered to existing and new clients, which facilities remain open or partially open during the pandemic. For the full year of fiscal 2020, revenue increased by $126.5 million or 9.9%, reaching $1.41 billion compared to $1.29 billion last year. Organic growth was negative 2.8% due to the impact of the COVID-19, which was offset by revenue growth coming primarily from acquisitions. Adjusted EBITDA amounted to $104.9 million, an increase of $27.4 million or 35.3% over the corresponding period of 2019. Now moving to our business segments. The Jan Canada business recorded revenue of $138 million in Q4, an increase of $3.3 million or $2.4 million compared to the fourth quarter of 2019. The segment reported adjusted EBITDA of $18 million compared to $8.6 million in the fourth quarter of 2019, representing a margin of 13.1% compared to 6.1% last year. For the full year, this business segment recorded revenue of $532.2 million, a decrease of 1.4%, while adjusted EBITDA increased by $25.6 million or 72.1%, reaching $61 million in 2020. Our Jan U.S. business recorded revenue of $84.4 million in Q4, an increase of $1.2 million or 1.5% compared to Q4 of 2019. Adjusted EBITDA increased by 57.2% to $9.1 million or 10.8% of revenue compared with -- to $5.8 million or 7% of revenue in Q4 of 2019. For the year, the business recorded revenue and adjusted EBITDA of $331.6 million and $29.3 million, respectively, increases of 2.2% and 18.2% over 2019. During Q4, our Technical Service segment recorded revenue of $125.7 million, an increase of $16.1 million or 14.7% over Q4 of 2019, with the full amount of revenue growth coming from acquisitions. Revenue decline on an organic basis was 17.8% as the business expects a reduction in on-call services and projects due to the resurgence of the COVID-19 pandemic. Adjusted EBITDA was $7 million in Q4, a decrease of $1.4 million compared to last year. For the full year, the business recorded revenue of $483.8 million, an increase of 29.1% and adjusted EBITDA of [ $70 million ], a decrease of 21.6% compared to 2019. Finally, our Complementary Services segment reported a revenue of $21.4 million in Q4, an increase of $4.9 million or $29.6 million compared to Q4 of 2019. Adjusted EBITDA was $1.6 million compared to $0.9 million in the fourth quarter of 2019, an increase of 67.7%. For the year, the business performed well. Revenues were up by 15.4% at $84.9 million and adjusted EBITDA by 106.3% and $9.6 million. Now I would like to turn the call to Claude, who will provide further comments on GDI's performance during the quarter.

[Claude Bigras, President, CEO & Non]

Thank you, Stéphane. Good morning, and thank you for taking the time to participate to our earnings call. I am pleased with our team resilience and our overall performance in 2020. It seems like a lifetime ago when our messaging to investors during Q1 was of the future that was uncertain. That we were modifying our cost structure, mitigating business disruption and implementing plans to preserve GDI's financial health. Today, as I speak with you to discuss our annual final results, I can only express again how proud I am of the entire GDI team. Our company is emerging from the COVID crisis in a strong financial shape, and we're of a view that we are also in a strong competitive position. As one of the largest and the leading facility service provider in North America, we took a leadership position in the industry in advising clients on the various processes and procedures to implement and -- the products to use to help keep their facility clean and mitigate the risk of virus spread. GDI team's members were on the front line through 2020, fighting the virus, doing everything that could be done to provide our client with the essential services they need to keep their facility safe and virus free. And I am incredibly proud of the performance. On a financial basis, GDI performed very well, considering these times. We achieved over $1.4 million -- billion of revenue, growth of almost 10% despite the headwinds from COVID in the form of facility closure and higher vacancy rates. GDI delivered $105 million in adjusted EBITDA, which is a new high-power business, and it is the first time we have surpassed the $100 million mark. And we reduced our total debt by $11 million after having paid a pretty large amount in cash on the closing of the ESC acquisition in January 2020. We were also able to retain most of our workforce in place and the totality of our management talent. Turning to our business units. Our Canadian Janitorial business unit performed very well during the year, delivering a 72% increase in adjusted EBITDA. While several Janitorial service clients were operating facilities at the lower than normal capacity level, many clients require enhanced services and specialty services due to the pandemic including, for example, higher frequency cleaning and disinfection services. Our Janitorial U.S. business also performed well during the year, delivering an 18% increase in adjusted EBITDA despite a modest organic revenue decline compared to 2019. Several clients of our Janitorial U.S. business segment required additional services as well due to COVID-19. However, it was on a lesser degree than -- that what we experienced on the Canadian segment as our results are different and market mix. In short, our Technical Service business has been GDI business that was the most impacted by COVID-19. At the height of the onset of the pandemic when we experienced government and due shutdowns of many sector in the economy, Ainsworth service call and project business slowed significantly. As your regional economies progressively resumed activities, Ainsworth service call volume began to grow and projects started to come back on stream. During this slowdown, however, bidding activity did not stop. Presently, we are sitting on a record backlog at Ainsworth, which is very promising for the future of the business. And we are optimistic in having the largest service-focused HVAC business in Canada with our clients beginning to focus on the importance of air quality, air purifier -- purification as they are planning for the building to be reoccupied. I'm also very excited with our latest acquisition completed by Ainsworth. BP Group is a well-established mechanical service company based in New York City and represents the first significant acquisition in the U.S. market for our Technical Service group. In the 1.5 months since the acquisition closed, I can tell you that we are incredibly happy with our new partnership, and there is a very strong cultural and business fit between Ainsworth, GDI and BP, and we feel that BP will serve as an optimal platform to build our U.S. Ainsworth business. And we are now open for new and large avenues to grow. Our Complementary Service business, which now consists of our product manufacturing and distribution business, had a very strong year. This business experienced higher level of demand, mainly from for personal protective equipment and cleaning and disaffecting products on both GDI and its client and third party clients, the business delivered 20% of organic growth in the year. And more importantly, we were able to provide our clients with all critical products at the time of need. In terms of the outlook for our business as a whole, we expect that as long as the COVID-19 virus remains a risk to our society, our business will continue to support our clients, who looks to GDI for expertise, enhanced support to keep their facility safe, and this could ensure for multiple years as many experts are expecting to evolve into a recurring seasonal event. By all means, the impacts are positive for GDI. Over the near term, given the progressive deployment of our various COVID vaccine and the upcoming warmer weather we are expecting that the case count number will continue to reduce and facilities occupancy level were beginning to recover. While there remained a lot of noise and uncertainty over office space requirement and vacancy rate in a post-pandemic world, we do not believe this will prove to be a headwind for our business. We have a client portfolio that is well diversified by end markets. Our commercial office business is concentrated in the Class A Building segment where demand tends to be resilient, and the system and equipment and the buildings can need the same degree of maintenance and repairs whether they consist 5% or 15%. I am more confident in GDI's business prospect today than I was at the beginning of 2020 before we first started hearing COVID in the world. Due to the global performance GDI has delivered since the beginning of the pandemic, our balance sheet is strong. Our leverage ratios are at all-time low. And we are in a solid financial position. We continue to focus on our growth through acquisition strategy and our financial strength should enable us to capitalize on strategic opportunity as they arise. I look -- it would look like -- I'm sorry, I would like to finish by thanking each one of our dedicated employees who work tirelessly in the front line of this pandemic. Our clients were depending on us to keep them safe, and all of you have risen to the occasion. I'm extremely proud to see how our entire team has been stepping up to the challenge. That concludes my remarks, and I will ask now the operator to open the lines to analysts for questions.

[Operator]

[Operator Instructions] And your first question will be from Michael Doumet at Scotiabank.

[Michael Doumet, Analyst]

Maybe just to start us off on the Janitorial U.S., just wanted to ask what the drivers were for the improved organic growth there versus the last couple of quarters as well as the sequential margin expansion? And whether you can speak to maybe the sustainability of that trend into '21?

[Claude Bigras, President, CEO & Non]

You know what, I'm sorry, but this is one of the COVID problems is, I did not hear you clearly on your question. Can I ask you just to...

[Michael Doumet, Analyst]

Yes. Go ahead, sir. Yes, okay. Well, hopefully, you can hear me now. So the question was on Janitorial U.S. Just wanted to get a little bit more color on the improved organic growth there versus the last couple of quarters as well as the sequential margin improvement and whether you can speak to the sustainability of the trend?

[Claude Bigras, President, CEO & Non]

Okay. Well, thank you very much. And I'm sorry, again, for make you repeating it. Well, listen, in the U.S., we are -- we have experience, actually, I would say, a quicker reopening of the markets in many of the states we operate in. So the business mix and also the state of the reopening actually gave us a kind of, I would say, a flavor of what the after math could look as we have a mix of operating clients with enhanced services requirement. So that covers a little bit for the margin expansion in Q4. But like I said, again, what it -- a little bit less top line, but you know what, a sustainable margin. So our trust back in the U.S. that, yes, it will continue as probably would become the new normality going forward where you have regular services with enhanced services, so this is what we figure more or less.

[Michael Doumet, Analyst]

Okay. That's just interesting color. I guess the second question I had, and you partially answered it, was really on the margin differential in Janitorial Canada and the U.S. since Q2. You talked about end market exposure being maybe the biggest difference. But I guess I want to take it a step further here based on your comments. Given that the U.S. has historically generated higher margins, like how should we think about the margins in those 2 segments kind of merging into 2021?

[Claude Bigras, President, CEO & Non]

Well, listen, it's all the same thing. We do not give specific guidance on margins. And -- but I can tell you that in Canada, we have experienced a higher level of specialty work traditionally than the U.S. lately. But Q4 last year was extremely demanding on our specialty work requirements, both in Canada and the U.S. So again, we expect those margins to continue as the market level ups. But this is again, it's hard -- there's still a lot of uncertainty going forward. So you have to bear with me that we are very prudent in our expectations. So we adjust as it goes. We have another resurgence and the picture can change dramatically again.

[Operator]

Next question will be from Maggie McDougall at Stifel.

[Margaret Anne MacDougall, Head of Research]

Following up on Michael's question, wondering how all of these dynamics, where you've got a new normal, I suppose, of regular cleaning, plus specialized cleaning services. How that has impacted or shifted the competitive landscape? In other words, is this something that you're seeing benefiting you versus smaller competitors or have the smaller competitors been able to offer the service levels that are now required in the COVID world?

[Claude Bigras, President, CEO & Non]

Well, listen, I think like I was saying in my comments that I think we are in a better overall competitive shape for several reasons. One of the reason is we have a very strong market penetration. So when we're talking enhancing services, more clients, you have more enhanced services you deliver overall to start with. Secondly is customers, I think, and now, again, I don't want to do forward-looking statements. But at the end of the day, as customers are getting into this new normality, they require more safety. They require more sustaining. You know what, the reports of BP up, there's a big noise in the Janitorial market. So customers will have to rely on very credible suppliers and very well-structured suppliers that will deliver the service. And I think this is also a big plus for us. As we have the infrastructure, we have the reporting systems in place. We have the process in place. So I think this will be all pluses going forward than just looking from 3,000 feet high perspective and a supplier. Customer will have to go deep to make sure that our business partner is solid and very competent in delivering the cleaning solution or the HVAC solutions to their properties.

[Margaret Anne MacDougall, Head of Research]

Great. Following up on that, I recall from last quarter some commentary that there was some RFPs and other new bid work that had essentially been postponed during the worst of the pandemic. Do you expect to see some of that come back around this year? And if so, what's your expectation in terms of cadence for those opportunities?

[Claude Bigras, President, CEO & Non]

Well, that's true that during the pandemic period because of manufacturer like work-at-home, facility not being accessible. So most clients that has a usual 4, 5-year process into contract renewals are testing the market, if you allow me to say this like this as postponed their RFPs. Now as the buildings were reopened and everything, for sure, those clients. But my view that the activity has restarted lately. So clients are adjusting to the new reality. So they develop our pre process, which are a little bit different. But we have seen a certain restart on that front. Now we have a very strong pipeline of customers that we feel they will go to the market. Our pipeline has been higher than usual. So that's a good sign that customers will go in the market. And secondly, on the technical side, as I was saying, is we have a all-time high backlog. So yes, there was a stall in Q3, Q4. Q4, we have seen a certain comeback. And our preliminary numbers indicate that we're going to be very busy for the next 4, 6 quarters, responding to requests.

[Margaret Anne MacDougall, Head of Research]

A final question that I have relates to your Technical Services business and perhaps takes a bit of a different approach here. So you commented on clients inquiring about air purifying systems and that kind of thing heading into the spring season when more people will be out and about and hopefully getting back into more normal life. But I'm also curious, your Technical Services capabilities between ASC, BPAC and Ainsworth in terms of improving the environmental standards of the buildings with regards to energy usage and a bunch of other factors because as we're seeing that E part of ESG is increasingly important and highly valuable. And so I'm really interested in the role that GDI may play for your clients in -- to that regard.

[Claude Bigras, President, CEO & Non]

Okay. Well, Maggie, thank you very much. That's a very interesting question that I will have to take 2 minutes to answer, I think, on this one. First of all, you are right. As Ainsworth through all of our subs and our business partners, we are very well equipped to -- sorry, for tomorrow's needs, okay? I think tomorrow's needs will be more people have realized that they cannot only go on I can approach they need to have. When I say clean, I don't want to go back to cleaning, but if you bear with me, is people are now aware more than ever that the danger is what they don't see and what they don't feel. So people will demand. Business owners, manager, workplace providers, they will require a certain level of safety into the delivery of the services and delivering air and comfort. It's a service delivery. Today, what's going to happen is we're going to have to modulate more customized solutions for occupants. So that's a better control system, a better building automation systems. So that's one thing. Also that the cost will more or less have a small increase for operators. That's what -- you cannot win everything. So there will be a kind of a cost increase delivering those services. So customers, because they do their job as well, is they will find ways to recuperate that supplementary cost. Thus comes a better energy management approach. They will try to recuperate those cost structures, but within sustainable savings, and we feel like a better energy management approach and technology approach to the operating the building. That building actually benefit Ainsworth. Sorry, the answer was long, but I wanted to make sure that I was clear on the approach.

[Operator]

Your next question will be from Jeff Fenwick at Cormark Securities.

[Jeffrey Michael Fenwick, MD & Head of Institutional Equity Research]

I -- one question I had was on your comment around we're in a bit of a new normal now. And after this amount of time, you must be having some of your client contracts come up for renewal. And I'm just wondering, when you're doing those renewals now, are customers looking to bake in more of these enhanced services to become a bit more of your consistent almost recurring types of services, meaning are you going to lock in some of this business as something that sounds like it could be a requirement for a very long time as part of the contracts?

[Claude Bigras, President, CEO & Non]

Listen, we still earn in the process. Like I was saying, RFPs, more or less, have been postponed in several occasions. But what we have seen actually, Jeff, into the last quarter, now customers are issuing RFPs with specific service requirements for high-touch areas, food sanitation, sanitation and food areas. Even like, universities, now they have implemented a whole series of protocol in place that are now built in into the their request. So we're starting to see that now it will become part of the new normality. For sure, you know what, probably it will adjust over time, there would be different scenarios that will develop in front of us. But we're starting to see it actually in RFPs.

[Jeffrey Michael Fenwick, MD & Head of Institutional Equity Research]

Okay. That's helpful color. And then I wanted to touch on the BP acquisition briefly as well. As you mentioned in your comments, it sounds like the United States is likely to be more quick to open up in the near term. What's the opportunity there to really ramp growth out of that platform? It sounds like they did well over the last year, some of the same challenges, obviously, that Ainsworth would have faced in Canada. But as you look to expand that business and expand the service offering as well, could that be something that maybe surprises us a little bit in terms of the growth that you get to drive out of it?

[Claude Bigras, President, CEO & Non]

Listen. I think the past pandemic era will be to -- I would say, if I was to tell you, one of the differentiators we have from the port to future, I think we'll invest more energy and resources into promoting the services because, again, like I said, customer will really look into making sure that they have the absolute right and competent business partner in their facilities. So yes, I think we spent a little bit more in promotion. Now this is one part of our growth strategy. The other part would be that I would say that, and I was the first, if you remember, the ones that we were with us last year in large, it was not it was not a funny time for a lot of people. So we developed a lot of concern, and I was not the only one. What I'm saying is, I think that as the second-generation janitor contractors have seen the limit of the systems, I think that it will give us opportunities to develop our M&A activities over time in the sector as people would like to -- I would say sharing is -- not share, but at least diversify the risk. So I think this will give us some opportunities going forward.

[Operator]

Next question will be from Frederic Tremblay at Desjardins.

[Frederic Tremblay, Analyst]

First question on the Complementary Service segment. Obviously, very strong growth still in that segment in the quarter. And the margin was down sequentially from Q2 and Q3. I was just wondering if it's a reflection of maybe the product mix there? Or if there was a change in the competitive environment? If you could help us understand that.

[Claude Bigras, President, CEO & Non]

Well, you know what, I would say, yes, there is a change in the competitive environment. 6 months ago, what product manufacturing was almost like bootlegging. But now you can find sanitizers in every corner stores. So yes, as the offer developed over time, for sure, it has normalized a little bit the business. But I'm very happy that we're still very busy. And I'm very happy that we were able in the roughest time to provide solutions to clients. Going forward, I think we will have an enhanced sales capability. But I think that margins would be more into a normal bracket.

[Frederic Tremblay, Analyst]

Perfect. And then on the BP Group acquisition, just wanted to get your thoughts on the impact of COVID on them versus what you saw in Ainsworth Canada, for example. Are they -- have they been similarly impacted? Is there mix between projects and service calls, similar to your legacy Technical Services business? Maybe your thoughts on that and how we're positioned as we're exiting COVID now in the near future?

[Claude Bigras, President, CEO & Non]

Well, no that's a fair question, Frederic. Our analytics that we had throughout the fall because, for sure, we were involved for a couple of months before we announced it. But our tracking shows that there was a high degree of similarities between -- I would say they were very correlated. What we've seen, the shutdown in Q1, Q2, people, I mean, and a slow recovery in Q3. Now they're more or less at what, I would say, almost normal service level and projects. So yes, the same thing as our Ainsworth business, more or less. Mind you that Québec and Ontario, in Q2, which was a big challenge, to the [indiscernible]. The Technical business has the --with the governments really shut down the whole industry.

[Frederic Tremblay, Analyst]

Okay. And my last question, maybe staying with BP. Can you talk about the overlap that BP has with your U.S. Janitorial operations? And if you see any cross-selling opportunities there between BP and your Janitorial operation?

[Claude Bigras, President, CEO & Non]

Okay. I would say twofold. First of all, through our previous acquisition and our ESC acquisition, in which we have operation in some states already through control and HVAC. So for us, if there is the occasion to consolidate our brand and our service offering in one single mechanical entity, which is good for us. The second point is I think it will enable us to offer our traditional GDI clients and a good opportunity to service them on other businesses. Now we have -- in order for it to make sense, I have to tell you this, we work mainly with very large properties, with very -- we cannot improvise ourselves. So now the customer sees our depth and our expertise on the market, now we have a fair chance of working for them. So it's a work in progress. We have to build this credibility. We have to build this infrastructure. So now for us, it was a big leap forward. So yes, I think it will enable us to enhance our offering to clients and the third items, and I don't want to extend too much on it. But it's our first step into the New York market, which is by far one of the largest markets in the world. So we don't know how it's going to unfold, but it's all positive for us.

[Operator]

Next question will be from Zachary Evershed at National Bank Financial.

[Zachary Evershed, Analyst]

So building on Fred's question on BP and your answer about the first step in the New York market. With the balance sheet in great shape and, of course, the new Technical Services platform in the U.S., do you think it would be fair to assume we'll see an acceleration in the pace of M&A versus the last few years?

[Claude Bigras, President, CEO & Non]

Well, listen, David is going to have to move from part-time to full-time working. No, no, I'm joking. No, no, let's -- for sure. For sure, we have a better exposure overall. We have a stronger capacity. For sure, it will -- we will work very hard, and it will have a positive impact on our M&A activities. It's for sure. But again, it's to right -- to find the right partner at the right price, with the right payment, the right customer mix. The challenge is not to find opportunities, is to find the right ones. That's the challenge.

[Zachary Evershed, Analyst]

Great answer. And then looking at the backlog for Ainsworth, what's the business mix like there? And is the project profitability profile similar to the segment's historical margins?

[Claude Bigras, President, CEO & Non]

So far -- well, listen, again, I don't want to make forward-looking statements because I have got my 2 colleagues that look at me funny when I do that. But I would say that so far, what we have not seen a big differentiation between post to -- pre to post COVID margin and projects and service calls. For sure, the only thing I would say, and we had to adjust on it is, for sure, there are some requirements, plus COVID, that needs to be covered like personal protection equipment, distention, access to elevators and to facilities but we're coping with it. And so far, we have not seen a dramatic change in our margins because of those. We have adjusted according to it.

[Operator]

[Operator Instructions] And your next question will be from Scott Fromson at CIBC.

[Claude Bigras, President, CEO & Non]

I'm sorry, Scott, I don't want to interrupt you. So I think it's the first time that we have this -- the chance to exchange, right?

[Scott Douglas Fromson]

Yes, it is. Thank you, Claude. Just trying to beat a dead horse to further depth on BP. Just trying to get a sense of what role the pandemic played in the deal. Did it play into the acquisition price and the timing? In other words, was this an opportunistic deal? Trying to get a sense of how savvy you guys are in your acquisition strategy.

[Claude Bigras, President, CEO & Non]

Okay. Well, listen, I will share with you my thoughts and for what it is, okay? Actually, a transaction needs to be fair for both parties, okay? So I think we did the fair transaction for either the sellers and us considering -- I think the -- I would say, the differentiator is that we got into this transaction with a high -- a certain level of uncertainty short term. So short term, since there's volatility in the market can shut down again and everything. We have made the decision to see the longer-term approach to the business instead of the short term. Don't forget, the people that you work with, that you acquire, are people that works with you after. So for sure, there would be opportunistic opportunistic transactions, but it would be based on other means. A company that has a certain in capacity from either financially or succession. But an example, in this particular transaction is we paid a fair price, and we decide to overstep the risk of the short-term 2, 3 quarters. But mind you, so far, we have no bad indication, but this is the game plan that we decided to take. We said we look at the post-COVID return, although there is a small risk and getting it. Does it make sense to you?

[Scott Douglas Fromson]

Yes, that makes sense. New York will be will bounce back for sure. Just maybe a quick follow-up. Did the owners bring forward their sale timing? I would imagine that you were in discussions with them from a long time before COVID hit. Did it spur them to speed up the sale process?

[Claude Bigras, President, CEO & Non]

Well, listen, yes, you're right. We did a lot of living room dating. But they were a fantastic business partner. So yes, we had engaged into discussions before COVID. And when COVID hit, for sure, it created a certain amount of disruptions in our process. But we came back what as soon as we were able to resume our activities, we continue the -- our transaction, which we closed in early January.

[Scott Douglas Fromson]

It's good you took it to in no a more suitable room. I'll leave it there.

[Operator]

And at this time, we have no further questions. Please proceed.

[Claude Bigras, President, CEO & Non]

Okay. Well, listen, I would just like to say thank you again. You -- again, I want to take you all our workforce and our partners into these uncertain times, challenging times. So far, people have all stand up. Thank you very much for your support, and I look forward to talking to you in the next quarter.

[Operator]

Thank you, Mr. Bigras. Ladies and gentlemen, this does indeed conclude your conference call for today. Once again, thank you for attending. And at this time, we do ask that you please disconnect your line.