Mountain Province Diamonds Inc

TSX:MPVD

Earnings Call Transcript 2020-Q2

[Operator]

Good morning. My name is Sylvie, and I will be your conference operator today. At this time, I would like to welcome everyone to Mountain Province Diamonds Q2 2020 Results Conference Call. [Operator Instructions] Mr. Stuart Brown, you may now begin the conference.

[Stuart Michael Brown, President, CEO & Non]

Thank you very much, Sylvie. Good morning and good afternoon to everyone. Welcome to our Q2 in half year Mountain Province update call. As usual, I'll start off, I'll cover production and cover a bit of guidance in the overall premise of what we're trying to achieve.I'll then hand over to Perry, who will take us through the financial highlights in a broad scale. Return to me, I'll deal with market and what our future plans are. And then we'll turn it over, very briefly to some questions. Without further ado, I'd like to touch on a very basic point right up front. As we know, there is some forward-looking statements being made today, so please take note of the cautionary statement regarding all of this information.This included in the presentation and should be on display. For those of you who got access to the webcast. And also, there are some references that might be made to non-IFRS financial reporting measures today.So before I get into the actual production highlights, just -- I think just a bit of context, everything we say today and everything we measure again should be obviously taken in the context of the COVID-19 pandemic. It has had an extraordinary effect on our whole industry and obviously, even more directly on us and that's the focus of what we're trying to cover today.We entered into 2020 in what I thought was a very strong position; we had a great stock balance. We had our costs under control, we knew where we were mining and we had good expectations per office to sale of diamond production going through the pipeline and generating cash.And obviously, everyone knows what's happened, so I won't belabor the point and we won't be processing all -- every point we make with COVID-19. What we have done is we assessed our options very early on; we looked at potential options around closure of mine, multiple in the mine, and discovered which options were best for us looking at a number of cash flow outcomes, and Perry will touch on some of the financial steps that we took to alleviate our cash position.But what we are doing is we're planning forward in a very difficult future. So we anticipate or we anticipated a very difficult future, we didn't understand the full impact to how big this challenge would be.What has happened, if I turn to the production highlights, and if we look at the comps, it's obviously negative variances. But if I put that into context, our tonnes treated our only margin down on Q2 last year, if we compare Q2 2020 to 2019. We've made use of the stockpile which is precisely why it's there, to allow us to get the tonnage that we weren't able to source from the pits that we were mining.The biggest impact as we've tried to explain on some of our announcements is in taking the avoidance measures as we had to reduce our personnel on site, we had some higher risk people and for various reasons. So we sent them home on furlough and left a shortage of crews and our mine stripping has suffered, which has then, obviously reduced our access to the ore tonnes that we need to put through the plant. So, balancing all of that, we've had a slightly different mixture, not preferable mine plan.But overall, if I look at the H1 versus H1 last year, or Q2 versus Q2 this year, I'm relatively pleased that the tonnes treated is very close, our grade is almost spot on. We would have liked it to have been a bit higher due to some of the tonnage that we had to give up and go back for low or lower quality tonnage that was more influenced by waste and low-grade areas.So taking all of that into consideration to end up the year, I'm just under 1.6 million carats in total, very pleased about that. Given that we are not selling those on the open market, it's very hard to then compare whether that's financially been to your benefit, but if we look at the pure production, I think everything that we've done on site to achieve what we can achieve and maintain production and -- has been very good.This then flows into the guidance page where we are anticipating that we will be down on the total ore and waste tonnes mined, probably around between 37 and 38 million from our original targets, so it's going to be pretty hard to outperform that target. We did have a lot of intervention to try and do that.We're now back up to full crews, got full complement, all the equipment has been maintained during the down time, so we are back to full scale on all the trucks and shovels and drills, so we should start seeing a better second half, because we are now -- also the good weather window, so we should be making use of that and that's the plan.We reduced our carats recovered in [Technical Difficulty] say pretty much similar. But the grade impact has had to be factored in. So that's why we reduced the carats and I'll leave Perry to talk about the costs of turns and cash cost per carat because he will address that in a broad sense.So in conclusion, if I look at production, we've used a lot of our stockpile, we've maintained our tonnes treated, we're confident we'll get the balance of the tonnes treated through this year to meet our guidance targets. We hope we would like to outperform ourselves on the carats, but that we haven't got full control over as we got to unfold the next 6 months of the year.And in conclusion, something that is probably very important to all of us on site and certainly we don't make a big enough fuss about, is that we now, in our 674th day without a lost-time injury. So I think despite all of the challenges that we've had and they've been enormous on mine, with different shift patterns, longer working cycles, the sacrifices that our employees and contractors have made have been very beneficial to us. And I'm very pleased that we are maintaining such a good discipline on mine, that's always very helpful, especially when it comes to our product. So without further ado, I'll hand over to Perry who'll cover or take us through the financial information.

[Perry Y. Ing, VP of Finance, CFO & Corporate Secretary]

Sure. Thanks, Stuart. And obviously, given the impact of COVID to our results during the quarter, I don't think it makes sense to go through everything line by line. So what I'm going to kind of do is touch on kind of the financial highlights and where we stand in terms of liquidity and potential path going forward. And then return it to Stuart.So just looking briefly at our financial highlights, we reported revenue for the quarter of CAD34 million, which is obviously down significantly from CAD96 million in the same period in the 2019 that resulted in a net loss of CAD27 million or CAD0.13 a share, and for the first half of 2020, our loss was CAD68 million.Also included in our results was inventory adjustments in the current quarter of CAD17 million. So we basically wrote it down to the potential market value at June 30. It's very difficult, with diamond markets not trading actively, to value inventory accurately, but obviously, based on the market conditions that we were aware of, we factored in a mark-to-market adjustments, which resulted in that CAD17 million adjustment.Also impacting us during the quarter was the appreciation of the Canadian dollar from about CAD141 at the end of March to CAD136 at the end of June. That just resulted in primarily an unrealized gain resulting from the translation of our bonds.So just looking at our liquidity position, we ended the quarter with CAD17 million in cash, compared to CAD32 million at the end of the first quarter. In between the end of the first quarter and then in the second quarter, we drew down US$25 million from our revolving facility as we discussed previously. That provided us the initial liquidity we needed given this cancelation of our normal time of sales in Antwerp.And then the second action was to enter into the Dunebridge sales agreement for up to $50 million worth of diamonds to a related party. Given the options available to the company at the time, we thought this was the transaction that made the most sense to provide immediate liquidity, as well as allowing the company to participate in the future upside potentially when those diamonds are sold.So as of -- during the quarter, I believe we transacted about CAD23 million under that agreement and then subsequent to the end of the quarter, we sold about another CAD20 million and then we have about CAD7 million to CAD8 million remaining which we should conclude before the end of the month. So essentially, we'll have concluded the full $50 million agreed amount with Dunebridge by the end of August based on current production plans and export time line.So from a cash standpoint, we have sufficient cash. Right now, we're current on all our payables with De Beers and our normal vendors. We do need further liquidity. Stuart will talk about the markets and our anticipated resumption of sales in Antwerp, but beyond that, obviously, we will need a financing solution that is agreeable with our lenders on a timely basis, which we're currently evaluating the options on and which, when we have something definitive, then we'll obviously inform the market.Just in terms of a couple of things to touch on. Stuart talked about the cost and cost saving measures that we're undertaking. So just looking briefly high level at cash cost during the quarter, they were slightly elevated if you look at our cash cost per tonne, it was CAD125 per tonne versus CAD106 in the same quarter in 2019. If you look at the denominator, we process about 11% less tonnage compare -- year-over-year, and then the remaining incremental costs where I would attribute to a mix of onetime cost relating to COVID as well as being in a high-stripping phase of the Hearne pits.So in terms of our overall guidance, we do expect to still be in that CAD100 to CAD110 per tonne treated range for the full year and hopefully, as we work with De Beers on cost saving initiatives, we can be at the lower end of that range. And I think with that, I think, I'll turn the presentation back to Stuart.

[Stuart Michael Brown, President, CEO & Non]

Thanks very much, Perry. So I'd like to touch on so the broad aspects of the market and the industry itself, not specifically just related to the diamond retail or anything, I think if we address the market, it is extremely easy to get very down when looking at all aspects of the sector. I mean it's just full of negative headlines. No one selling, retail not doing well, China bouncing back, you got a -- you hop through all of those mines, which is what I'll attempt to do today, very briefly, to give us the conclusion as to why we think it's appropriate to contemplate resuming our sales.Retail, if we just address that. Obviously, the shock to the system was everything closing down, lockdown, global trade ceasing, travel, people not moving around. And now you're seeing those reports come out as people are reporting on the quarterly information.Where China has been ahead of us in experiencing this crisis and now coming out of it, we are seeing on the comps that they are trading well, the levels of returning and their volumes are trading well.Similarly in the US with the states now opening up in many areas, people are changing their sales patterns and methods. They've got more popularity with the single stores, which we would brand them mom and pop stores rather than the mall stores, where traffic hasn't yet fully picked up.We are seeing sales on the comp basis, June to June, last year to this year. Not too bad. And we're seeing people coming back. What you do need to understand though, is, in -- globally, in the retail perspective, this is not a big selling season. There is no fundamental reason to go out and buy diamonds, there's no events really other than normal engagements, normal weddings and things that are happening.Everything has been affected like that can drag you down, but we are seeing sales slowly pick up. I think this gives us confidence that the product itself is still in demand. People are realizing that they do want to celebrate with emotional purchases and meaningful purchases.So I think we're in the quiet season and if continue with retail window, I expect that to really pick up. Well, obviously. It's traditionally in the sort of the middle of Q4 to the middle of Q1 and I see no reason why that will not continue to be the case. We are seeing a lot more stimulated marketing and reaction to that.If I turn to the producers and I took all of us in that basket, no one is selling in a sustained way, from the majors to the independents, everyone is having to adapt and find some way to get around this. It doesn't matter if you're De Beers, Alrosa, Rio, you can look at all the headlines. Alrosa is negotiating with Gokhran which is to sell them stock. So we were all looking for liquidity.I think the deal that we did with Dunebridge, after having looked at all options out there and there are various people that are willing to buy diamonds on various basis. I think the idea of selling to someone and then having a future participation, a lot of the liquidity and we're no different to any other company doing that.Obviously the manufacturing side of diamond has also been slowing down due to all the COVID issue in India where all the manufacturing gets done, but we are seeing some demand in certain categories of rough as --The retail is continuing. So we are seeing pipelines shrink, we're not seeing rough being pushed into the pipeline. The majors have not been selling on a willing buyer willing seller-only basis. So that's been very positive. We haven't been in the market, so [ our goods weren’t ] there, many other independent producers have not been in the market, but where we have seen people go and sell their diamonds and we obviously got access to information in terms of hearing about the sales through public forums and other information as people discuss these things, we're seeing very keen attendance. We are seeing price down around about on average, let's say pre-COVID to now, around 20%, some categories slightly more and some categories slightly less.There are sectors of production in the higher qualities, some of the larger goods and sort of in the middle tier goods, also quite highly in demand because there's very limited supply of that with nothing coming onto the market. So the limited supply and limited manufacturing is helping shrink that polished pipeline and retail will continue to grow. But we still have to get through that phase. And a lot of other mining houses have also held back on production. So that's also going to help us in the medium term to long-term.So based on all of that we've been out of the market on a structured basis. Our last sale was in February; suddenly it was March, April, May, June, July and August; and we think that given the stability and polished prices, we are seeing some slight increases in the certain categories on polished and we are seeing further demand in certain areas of the rough, not in all sectors, but the longer this goes on the more we will see there will be some categories that we need to supply to the market and we've taken the decision that Reid will be taking our goods to market in September in our normal structured way in Antwerp. And that's after the European summer holidays.We retain the flexibility in our sales method, we don't have to sell everything if we're not attuned to the price, and I think that's market related. Obviously, the biggest thing that we're looking at is liquidity right now. We have to get through this whole cycle and there is 2 ways that we need to do this. We need to ensure that we can get liquidity through selling our product. As Perry said, we are about to complete the Dunebridge CAD50 million, we will do that by the end of the month. And then, we're reliant on the markets and as some observers say, that's what we're dependent on.In the background, and we don't refer to it, but we are working on, we have a solution to our funding liquidity. We've had support from the banks, we know where they stand and we are working to complete that before the end of September. We still got a few things that we're doing, so we are not able to come up and finalize that in the market space, yet. But the solution we have or the potential solutions we're still working on those and they are progressing well.So where we stand right now is incredibly difficult industry. Please don't get too side tracked by all the noise and doing that, but it's just reporting on what's happened. The future does look a lot brighter, we are seeing retail move, we are seeing stock move. Albeit we do need to see better price, but you got to start somewhere as we come out of this.Retail trade has not come to a complete standstill, so I think our product is sold in demand. The mine is running well and it's not getting back up to full steam having come through this crisis. We have adapted the way we worked. We're looking at further cost saving initiatives working together with De Beers that we will work on for the rest of the year to try and put us in a stronger position in 2021 and for the remainder of this year.We'll come back to the market as soon as we can with our financing solution, which we think is going to be favorably received and we look forward to updating you in the next quarter, we're hopefully, we have some better news and the world is in a more comfortable place as it works through this.So with that, I'll turn it over to some questions. As I've said upfront, I think we've covered a lot of these things, so I will take a few questions and then leave you to contemplate on how the rest of it works. Thank you.

[Operator]

[Operator Instructions] And your first question will be from Edward Sterck at the BMO.

[Edward Christopher Sterck, Analyst]

So I've got 3 questions, I think at the moment. The first one is just on the waste stripping profile. Obviously, due to the needs to physically distance people on sites and focus on current production, there was a scaling back of the waste stripping, should we expect a corresponding increase in waste stripping in 2021?

[Stuart Michael Brown, President, CEO & Non]

No, Ed. We're working on a couple of things to address. We can't just lump the extra 5 million tonnes on top of the -- I think it's about 42 that we need to do next year. We don't go much about 42. So if we're doing right, might reworking the plan, scaling back on certain areas and putting that over a longer term, we don't have a pension ore source for 2021 or 2022, it becomes more of an issue in 2023 and 2024. So we've got more time to address that backlog. And the other thing we're doing is we are revisiting the slope angle -- Perry just reminded me -- slope angle for various aspects of the pit, which we think will reduce the need to strip the original volumes of ore. So we're kind of working on a complete new mine plan with more aggressive slope angles and doing the geotechnical approvals on that right now. So that's something that we focus on. So, no, we're not putting whatever the deficit this year we'll end will lump onto next year, it has to be done properly, but it's not going to affect our tonnes treated volumes and our ore produced.

[Edward Christopher Sterck, Analyst]

And then just a couple of questions on -- for Perry, probably just the diamond sales Dunebridge, from an accounting perspective, how will those be treated because obviously, there's still an economic interest. I theoretically assume down prices hopefully recover. And then the second one is just an update on negotiations around the working capital facility.

[Perry Y. Ing, VP of Finance, CFO & Corporate Secretary]

Sure, thanks Ed. In terms of the Dunebridge. Yes, you're correct, we do retain the upside. We haven't accounted for any upside given Dunebridge is in full control of the diamonds and when they sell them and there is uplift versus the purchase price from us and then certainly, we'll participate and record that when it happens. But in terms of the balance sheet, we have not factored in any accrual for any potential upside.And I think in terms of the discussions on working capital, I think Stuart's pretty much outlined that. We're working closely with our lenders, Scotia and Nedbank. We have regular communications with the very professional. And until we have the solution, we can announce at hand. We obviously can't -- I can't say any more right now, but the relationship has been good and we appreciate the flexibility that's been demonstrated.

[Operator]

Next question will be from Scott Macdonald at Scotiabank.

[Scott Macdonald, Associate Analyst]

I just have a couple about the planned September sale and a little bit more on the balance sheet. So, as far as the September sale goes, are you going to try to sort of catch-up on your accumulated stockpile of inventory or will it be, do you anticipate the volume of carats you're selling will be kind of similar to what normal sales have been in the path.

[Stuart Michael Brown, President, CEO & Non]

Yes, Scott. So on that one, we'll have a normal volume, slightly higher than we would have probably at this time of the year, but it's not going to be extraordinary large. We obviously sold quite a lot of carats to Dunebridge, so we -- although we've got sufficient volume, we're looking at flexibility around that. I don't want to give the number away, because, again, in our selling method we like to keep the buyers honest.

[Scott Macdonald, Associate Analyst]

Okay. And now, I know, without getting into too much detail, but directionally, should we expect the average prices in Q3 should be better than Q2 just from, obviously, Q2 was impacted by lower quality mix? Is it fair to assume that the prices should be directionally upward?

[Stuart Michael Brown, President, CEO & Non]

I think in -- the sale in the [ I call Q4 ] sales, yes, we would. We haven't had any financial come through at all, Scott. That's the one category of good we haven't been able to get out of Yellowknife due to all of the COVID issues because the valuation and split method is a lot more complex and it f requires people to get into [ Yellowknife ], which we haven't been able to achieve safely as per protocol. So we've got quite a large accumulation of all of our fancies and specials out there. I mean, just agreed with De Beers on the next -- the way forward, and how to get those out. So we would hope to get our first bids against De Beers or with De Beers sorted by September. And depending on how those go, they'll easily get sold in September or later in the year. So we would expect our future sales to have a higher average value. We haven't had any fancies and specials in the sale process.

[Scott Macdonald, Associate Analyst]

Okay, that's helpful. And just on the balance sheet again getting into too much details, I know your discussions are ongoing, but do you expect your financing solution would be likely replacement of the revolver with another similar debt instrument, or could it be -- are you considering other options that are not debt?

[Perry Y. Ing, VP of Finance, CFO & Corporate Secretary]

Yes, I mean, we are looking at a full range of options. So I think we'd like to give you more details in terms of our thinking, but it would be premature at this stage to steer you in one direction versus another.

[Scott Macdonald, Associate Analyst]

Okay, fair enough. And --

[Stuart Michael Brown, President, CEO & Non]

We've got our numbers -- we look at --Carry on, Scott.

[Scott Macdonald, Associate Analyst]

Just sort of on a more philosophical or longer term basis, do you think that your total level of debt leverage as it stands today is sustainable or is that something you might look to adjust in your capital structure at some point going forward perhaps not with this upcoming transaction, but on a longer-term basis?

[Stuart Michael Brown, President, CEO & Non]

Yes. So it's a very fair question, Scott, I think that we are acutely aware of the size of the debt that we have in the US dollar bond, which is sitting at about $300 million, just under, I think. I think our approach there, it's part of all of our solution that we're looking at. That's why we're still considering a number of options.I think on the timing perspective of that, we want to be able to be in a position of really understanding the future cash flow. Looking at the plant. Looking at the world to see the best way forward, so we're kind of following these things sequentially. We bought ourselves time by paying the bond interest in June, as you recall, and now we've got quite a lengthy period between now and the end of the year when we can look at all of the options and we have to have the first part of the solution out pretty soon, and then we'll address that. So we're always looking at the level of bond, but it depends on how the world looks as well.So again, we'll be a little bit more wiser in a couple of weeks' time or another month's time. Hopefully, wiser after that. So it's not -- everything's on the table, Scott. If we look at all options all the time and come up with the best that kind of works to the possible.

[Operator]

Next question will be from the Daniel McConvey.

[Daniel McConvey, Founder & Portfolio Manager]

Just on that note, it's an obvious -- it's -- I'm sure it's an obvious answer, but when you -- it sounds like your optimism level has gone from troubled this 2 conference calls ago to improved, the last conference call for the first quarter and now it sounds like you have solutions in site. Just, is the optimism relative optimism, [ a tempered one ] is all from a shareholder perspective, correct?

[Stuart Michael Brown, President, CEO & Non]

I think that's -- so 2 calls ago, we were just getting hit with all of these things -- Hello, can you hear me?

[Daniel McConvey, Founder & Portfolio Manager]

Yes, I can hear you.

[Stuart Michael Brown, President, CEO & Non]

Yes, so 2 call -- So, yes. 2 calls ago, we were just starting this. We didn't know how big it was and last call, we were still, I guess, in the middle of the storm and I don't think we're out of it yet, but we know a lot more now about how the world is looking, we've got a lot more things to hang our hats on. We -- as I said in my address to you, we're burning through the noise, De Beers didn't sell. Well, that's a deliberate strategy. They'd come out and said, why they are not selling. And they want to maintain price.All of those things, we put together, that's our job, so am I more optimistic? Yes. Could I be wrong? Well everything can still work out differently, but with the knowledge we have and the confidence that we have and the people that we're talking to, our view of the world is that we got a little bit more cause for optimism. We are seeing sales take place, so stock is moving, people are interested in our product, we've had sales that have taken place where the independents have been well attended. We need better price and time will come through, but much more reduced production in the future outlook with mines closing, mines that have closed down already and probably won't re-open for a considerable amount of time. We'll have reduced supply and the consumer still sounds like they want to buy our goods.We're seeing turnover numbers come out of areas, so that I think fuels my optimism, and having been in this industry for long enough to know that it's not going to just close overnight. Is it difficult? Yes. Are we trying to find solutions? Yes. Are we talking to people that are willing to support us? We are. We haven't finalized all of those conversations and we're looking at as much flexibility as possible and we'll come to the right outcome.The one thing we didn't do was panic, and I think the Dunebridge sale was at a time where no one could sell a diamond, our major shareholders stepped up and we negotiated, I think, a very good deal.Just to clarify, and it's -- we don't have any downside, so that sale goes through accounting-wise, we have only upside. So, at least we know our bottom line and we did that deal. We think we've done it at a very fair price of market related to the best of our ability to establish that, and any recovery coming back. Go back to April 7 [Technical Difficulty] I was actually just measuring something this morning. I mean, stocks have come back on the -- all the major exchanges in the world magnificently. That doesn't mean to say the fundamentals for doing that are -- could be some, but it's -- since April 2 now it's markedly different. If you'd sold in April and you're assisting, I'd be booking a huge loss. Now, if you hadn't sold, you're back -- nearly back to where you were. So I think we need to be optimistic. It's not about walking around with your head in your hand all the time going, the world's come to an end. We've got to move forward and that's what the management team is doing, along with the De Beers team to ensure our product comes off the ground and we are ready to sell it when we can [Technical Difficulty], alternatives if we can't; that's the nature of what we supposed to do.

[Daniel McConvey, Founder & Portfolio Manager]

Okay, great. Are you -- if you were to sell a small stake of your share of Gahcho Kue, let's say 10% of what you have, would that be -- would that -- is that a possibility in your lending agreement. I'm sure you can buy restructured if you could do anything. But is that something that would be allowed from a debt perspective?

[Stuart Michael Brown, President, CEO & Non]

I think all options will be there. It kind of comes down to price and we could sell 10% for $1 billion and I think everyone would be more than happy, that I mean you got to deal with realistic outcomes. So we would look at all of those things. Everything is on price, Daniel. Yes, we would look at those kinds of things. If it made commercial sense, so, yes, but that's not something we are focusing on right now. We've got -- I think we've got better solutions on that.

[Operator]

Your last question will be from Paul Zimnisky at PZDA.

[Paul Zimnisky;PDZA;Analyst]

I guess as far as the timing of the resumption of traditional tenders, you said you're aiming for September, is this based more on what you're seeing from a demand standpoint or does it have to do more with a progression and international travel measures?

[Stuart Michael Brown, President, CEO & Non]

I think, Paul, if I cross my mind back to how sales work, August was European holidays. It's the last stage where people can pick up goods after that to go get in the manufacturing process, ready for the -- getting out into the wholesale-retail markets ready for the, let's say the Thanksgiving onwards and now that extended to Chinese New Year. So our confidence around September is that we've been out for 6 months, we've seen a few other people sell.We've seen good attendances prior to August. So we think it's worth having a look, we've engaged with various people to look at that and we've got a product that we've got people are finding us up and asking for that. We've done a few small sales in certain categories of goods. So we know there's demand and in certain areas and we'll have a look, we're not -- that's why we are not going with a big huge volume and pinning all our hopes on it, but we're going with a meaningful sale.So I think it's basically the market fundamentals of -- a lot of supply hasn't gone on; is there any manufacturing, but there are pieces -- places in the world that want our stock. So, that led to our decision around that. I think we're sort of selling by the middle of September or the third week, we will complete the sale. And again, a lot can happen between now and September, so we've got full flexibility as I said. So we're not just pitching up there hoping it works. We did better thinking around it.

[Operator]

Ladies and gentlemen, this is all the time allotted for questions today. I would like to turn the call back over to Mr. Brown.

[Stuart Michael Brown, President, CEO & Non]

Okay. Well thanks very much, Sylvie. I think that was just under 40 minutes. We will be updating you in the market, I think before the next call as we have to find the solutions by then. And as I said, we're working on those. Hopefully, the world is a bit more cheerful, maybe matches my mood a little bit and we look forward to talking to you again in the future. Thank you very much, everyone.

[Operator]

Thank you, Mr. Brown. 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 lines.