Welcome to the Devyser Diagnostics Q2 Report 2024. For the first part of the conference call, the participants will be in listen-only mode. During the Q&A session, participants are able to ask questions by dialing *5 on their telephone keypad. Now I will hand the conference over to the speakers, CEO Fredrik Alpsten and CCO Theis Kipping. Please go ahead.
Again, welcome to the Devyser Q2 2024 earnings call. It's a great pleasure to have you all here. This is the first time we publish our Q2 result in July, earlier end of August, and that's something I'm very proud of. Today you will listen to me, Fredrik Alpsten, the Devyser CEO, and Theis Kipping, our Chief Commercial Officer and responsible for business development. I have also asked our CFO, Sabina Berlin, to join us during the Q&A session. A lot of positive things are happening in the company. Those of you who follow us more closely may have seen a record number of positive press releases during the quarter. The sales from won tenders, etc. informed about in these published press releases are not yet reflected in the Q2 numbers. We'll see that later. Today we embark on a journey through our Q2 results.
The second part of the presentation will be dedicated to highlighting the key achievements from the quarter and discussing our commercial outlook. Sales developed very well during the quarter and amounted to SEK 53.2 million, a new record. The earlier record from last year was SEK 50.7 million. Sales growth compared with the same quarter last year was 41% in SEK and +40% in local currency. All growth is organic. The growth of +40% in local currency is the highest growth we have seen for one single quarter since the company was listed. The growth for the first six months of 2024 was 35% in SEK and 34% in local currency. The growth for the last 12 months was 38%.
With our innovative products, high market growth, well-suited commercial organizations that we have heavily invested in over the last quarters, and some of the best commercial partners, we are confident that our current positive sales trend will not only continue but also strengthen. While we may face individual quarters that not perform as well, the overall trend is clear. Our sales are on a significant upward trajectory, with most quarters expected to be record-breaking. Even with the impressive sales growth we have achieved in the first six months, we are confident that we can maintain this level of growth in the second half of the year, achieving at least the same growth in local currency as we did in the first half of the year.
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It's always dangerous to look at single quarters and draw too many conclusions from them. As single orders can heavily affect the quarter, it's much better to examine rolling 12-month periods. EMEA grew by 32% compared with the previous 12 months. During the quarter, we saw high sales growth in the Middle East and the European distributor markets, even if we are not fully satisfied with the development of the direct sales markets in Europe. Asia-Pacific grew by 26% compared with the previous 12 months. Q2 grew by 75% compared with the same quarter last year. During the last 12 to 18 months, we have signed up quite a few new distributors in Asia, and some of them have now started to generate revenue. The growth in North and South America was +166% compared with the previous 12 months.
We are very optimistic about North America and see the flat development during the last quarter as a result of uneven purchasing patterns from one of our distributors. Please remember that we do not yet have that many customers in North America. The potential in North America is massive, and we have just started to penetrate this huge market. North America will be one of our top priorities both for the near, mid, and long term. Our direct sales represented about 75%, and our distributor sales represented about 25% of total revenue, both for the quarter and for the last 12 months. However, as sales through Thermo Fisher are increasing and new distributors in regions like Asia and the Middle East are added, we may see an increased distributor share of revenue. One of Devyser's strengths is its business model.
We have very high gross margins because we only sell consumables and software, no equipment. Since I joined Devyser in the fall of 2020, we have managed to increase the gross margin from around 75% to around 85%. The reason is a scalable production process, even if it has up to now been rather manual, and our ability to increase prices. However, as we had grown out of our production facility, we decided spring 2023 to move to a bigger facility to enable higher production volumes and automate production processes. We have signed a 7-year lease with an option for another 4 years. With one shift in production, we can stay here even if we have a growth of an average 50% per year. We got access to the new facility in January this year and moved our offices to the new facility in February.
During the spring, we have worked extensively to build up the production and R&D part of the facility. As with all certified and regulated business, this must be done by the book, documented, validated, and verified. It must be approved by the regulatory authorities and notified bodies when ready. The regulatory authorities have now approved the new production facility, and we can move production and R&D labs from the old facility to the new one during Q3. All work to finalize the new facility has been costly. Cost of goods sold was negatively impacted by SEK 3 million during the quarter. We also had a negative impact. We also expect a negative impact during the third quarter, but we expect to be back on track by the end of Q4 this year. That's a gross margin in excess of 80%.
This investment will help us to drive down production costs even further and help us continue automating the production processes and accordingly increase our gross margins in the long run. It should also be mentioned that to minimize risk, we decided to rent both facilities, the new one and the old one, during the full year of 2024. This means that when we go into 2025, we will not pay rent for the old facility. The quarter's EBIT was in line with our expectations. It amounted to SEK -23 million compared with SEK -14 million in the same quarter last year. A couple of one-time items caused a low result. The move to the new premises, as explained earlier, was SEK 3 million extra during the quarter. Double rent for new and old premises. We have added SEK 3 million in additional rent costs per quarter during 2024.
We had also increased costs for our expansion in North America, including among other things, work to get the best possible compensation for our products in our CLIA lab, as well as work on setting up our own warehouse in the U.S. In total, another SEK 3 million. The positive development of the Devyser share price also meant that during the quarter, we were hit by higher costs for our incentive programs. The total cost for incentive programs, etc., amounted to SEK 2 million during the quarter. It should also be noted that during the second quarter of 2023, we brought back a provision of SEK 2 million for a so-called retroactive payback fee. We are convinced that the positive earnings development we saw in 2023 will continue and that we will reach our financial goal of an EBIT margin exceeding 20% from 2024 to 2026.
Devyser has a very strong financial position: SEK 201 million in cash at the end of the quarter and no interest-bearing debts. During the quarter, an employee warrant program expired, and the options were exercised. It meant a capital injection of some SEK 17 million for the company at the end of the quarter. With that, I leave over to Theis to give you some highlights from the quarter and a commercial outlook.
Thank you, Fredrik. Indeed, Q2 was a record quarter, and I'm happy to take you through some of the updates and the outlook to give the gist and the understanding that, in fact, we're just getting started. On June 17, if you move to the next slide, we announced that we have expanded the agreement with Thermo Fisher to now cover global territory. The reason we didn't provide Thermo Fisher with access to global territory for our transplantation products already a year ago when we first signed the agreement with them was due to the fact that we wanted to be reassured that customers responded well to the collaboration, as well as we wanted to be confirmed about the investments and the dedication made by Thermo Fisher. This we have now seen, and hence we're gladly now working with them on building a significant success globally.
Our products have long been advocated for by key opinion leaders, but now we're seeing laboratories start bringing in these products in their clinical routine across both Europe and North America, and thus we are confident that the momentum will only propel further once we get users across Asia-Pacific on board as well. Allowing Thermo Fisher access to global territory is attractive for the revenue growth of Devyser since we can now expand the market reach by an extra 43% measured on the number of kidney transplantations in the Asia-Pacific region. Together with Thermo Fisher, we are addressing a more than $1 billion market and have already made a lot of headway together in establishing new standards within the market using the Devyser One Lambda post-transplantation products. We have already reached the first IVDR approvals for both our assays and software.
We are pursuing FDA approval in the U.S., and we are on a solid path towards also having our tests reimbursed in our CLIA-certified laboratory. You can move to the next slide, Fredrik. Beyond the revenue logic related to the global partnership, it equally much helps with cost synergies since we no longer need to maintain a Devyser-only product line for the transplantation products, including taking them through regulatory approvals, etc. These efforts will now be focused on the Devyser and Thermo Fisher co-branded product line only. Hence, truly a sound business logic and business decision. As we now look into year two and onwards, together with Thermo Fisher, we are intrigued by the opportunities ahead, not least on the product pipeline front, where we have several new and potentially groundbreaking product launches coming up.
While these products are not automatically included in the master agreement that we have with Thermo Fisher, we do believe that these products will significantly enhance both Thermo Fisher's and our position within the transplantation area for the years to come. Let's move into Italy. During Q2, we closed deals worth SEK 84 million in Italy, including an all-time high tender covering the region of Tuscany. We continued expansion of our oncology business, as well as we won yet another deal for our thalassemia product. If you add the announcement that we did late last week, that number is close to SEK 90 million in the past three to four months. Italy remains our largest market, and I'm thrilled to see how the team continues to take market share and to expand our business.
Looking ahead, I'm excited to see that we still have a large number of opportunities to further accelerate this momentum. I'm sure that a lot more will come. Focusing on thalassemia, thalassemia is one of the most prevalent hereditary diseases in the world. The market is therefore huge, and Devyser, we are well positioned with our product, which grew almost 60% during the first half of this year versus the same period of last year, and now is about 10% of our total sales. We're pursuing a large number of opportunities in markets where thalassemia prevalence is high, such as Italy, Spain, Saudi Arabia, Malaysia, India, Singapore, and I could go on. Recently, our thalassemia test was chosen for a state screening program in California and the U.S., and we are pursuing other similar state programs within the U.S. as well.
Lastly, I can share that we are in dialogue with large pharmaceutical companies who have expressed interest in the product as well. I will soon come back sharing more information about these potential engagements in the months ahead of us. Another interesting product is our RHD test, where we have seen lots of strong traction. We continue to expand our market position, and we just signed up with another leading laboratory in Canada in addition to Héma-Québec, which we already have announced. In addition, we announced in December that our RHD test was chosen for nationwide screening in Wales, which is just yet another country to the list where our RHD test is chosen for either state, region, or nationwide screening.
One of the markets yet to be penetrated with RHD testing in the U.S. is in the U.S., where the market standard is still the prophylactic injection for pregnant women. However, just recently, the prophylactic drug program came into shortage by the suppliers, and thus we now are seeing a very heavy intake of requests for testing in the U.S. I have early on been very bullish about our market opportunity for this product in the U.S. And now, especially once the market turns towards testing before injection, I am even more bullish with this potential. These days, we're in dialogue with some of the largest laboratory chains and laboratories in the U.S. around our RHD test. And I'm hopeful that one or several of these opportunities will land during this year, and I'm excited to be communicating soon about this.
Let's move into the next update regarding what does the future hold with regards to Thermo Fisher. We're now one year in, and we're already seeing strong growth. Currently, we are up some 65% above H2 2023. With lead times, as we have talked about before, being 12-18 months, we're just at the beginning of the growth journey with Thermo Fisher, and we're confident that this will accelerate in the months and the years to come. We're adding three new indications: heart, liver, and lung. We're pursuing FDA clearance and launching new products that will be groundbreaking in the care of transplantation patients globally. The additional three indications, as mentioned before, will expand our addressable market measured on the total number of transplantations done globally.
This is an exciting time in the field of transplantation, and I'm absolutely sure about Devyser becoming a key player for many years within this exciting area. Looking at what's next in the U.S., we continue to pursue the opportunities within testing for cystic fibrosis following the updated guidelines from last year. Our first customer is soon reaching clinical routine, and more opportunities are already in the pipeline. RHD, as mentioned, looks very promising, and I'm confident that this will be a great product for the U.S. market in the years to come. And alongside gaining traction in Canada, this product has the potential to become one of our best-selling products in the company.
In the U.S., 15% of the population are Rh negative, meaning that across the 3.7 million new births annually, there's a patient population of 550,000 patients annually who should be tested for their fetal status, which is a very attractive opportunity for Devyser now with the awakened interest in RHD testing rather than defaulting to the prophylactic treatment. Devyser Genomic Laboratories, which is our CLIA-certified laboratory in Atlanta, is doing well. We're on track towards having our first products being reimbursed and covered, as well as our engagement with a UK-based oncology company Cyted are moving along well, and the laboratory is fulfilling the objectives as a growth catalyst for Devyser in the U.S.
Within just a few years, I'm confident that our North American business will be the largest region that we have in the company, even bigger and ahead of our otherwise large and strongly performing market that we have in Italy. With that, I hand it back to you, Fredrik.
Thank you, Theis. As you know, over the last two years, we have taken some very important steps to build a global, fast-growing, highly profitable diagnostic company. As you also have heard, we are very optimistic about the future. We are focusing on North America and Europe. It's done via all our sales channels: direct sales, partners, via our CLIA lab, and via distributors. With our innovative products, a high market growth, a well-suited commercial organization that we have heavily invested in over the last quarters, and some of the best commercial partners, we are confident that the historical development we have seen can continue and even enhance. However, as important as high growth is to continue our way to profitability, it's our main focus. With that, we stop here now and open up for questions. Back to the operator.
If you wish to ask a question, please dial pound key five on your telephone keypad to enter the queue. If you wish to withdraw your question, please dial pound key six on your telephone keypad. The next question comes from Ulrik Trattner from Carnegie. Please go ahead.
Thank you very much, and good morning, Fredrik and Theis.
Good morning.
I have a few questions on my end. First of all, very thankful for the split in one-offs, but perhaps if you can comment on how these one-offs have developed since Q1? I note that OPEX has increased close to SEK 10 million, and it looks, at least in reported numbers, to be mainly in admin and R&D. If you can just help us understand that dynamic, how much is related to increased one-offs and what to extrapolate and what not to extrapolate into the second half of the year? That would be my first question, please.
Yeah. Without giving too much details because I'm not aware of them exactly, but I think it's important to remember a couple of things. The setup of the new production facility, the cost for that and the move that has affected the cost of goods sold by SEK 3 million during Q2. The extra cost we have for having two facilities, the extra cost for those facilities, that's taken as an administrative cost, not affecting the cost of goods sold. So that's one of the reasons why admin costs have increased quite much. And then we talked about the nice share price development we have seen. That's quite much also on the administrative costs. When it comes to the R&D costs, you have both capitalized and non-capitalized R&D expenses, and we maybe have capitalized slightly less during the quarter due to accounting reasons.
I'm quite sure that if you take both capitalized and non-capitalized costs, they have not increased that much compared with Q2. I think we'll be back on track also on how much we capitalized during Q3 and Q4. Does it answer your question?
It does. Thank you. Thank you, Fredrik. Really strong sales development across the board. You touched upon this, Theis, and you talk about expected continued sales development for Thermo Fisher into the second half of the year. I note that you have commented historically and continue to comment on the lead time of 12-18 months in regards to the tender activity. But in terms of the actual tender activity, have you seen any type of acceleration or interest in your Accept portfolio? A follow-up question would be, you mentioned now that you're ready to commercially launch the expanded Accept portfolio. Are these already commercially available, or when are you expecting first revenue to come into the company?
Thank you, Ulrik. Let's start with the first one. I mean, the traction that we're seeing is still in the early phase, I would say.
So of course, we are still only just a year in from the initial launch of Thermo Fisher. And still with that, I think we're shocked with the initial traction. We are seeing what really reassures me is when you look into what is being published, what is the clinical research that is made out there. And that's pretty phenomenal, I'd say, talking to the opportunities that we have with our products. So short answer, to make it as short as possible, we're still in the early phase, but we are very confident and reassured by the initial traction in terms of revenues, customer interest, tenders that are being written. So very strong start, and that should bode well for what the future should hold for us and Thermo Fisher together.
Great. Yes, a reminder there, Ulrik. Please remember that we signed the agreement with Thermo Fisher in the beginning of Q2, but they didn't launch until the end of Q3. So we are still in a quite early phase. We have not been with them for 12 months yet. They have not launched their products during 12 months. And as we said in the interim report, we foresee revenue from the expanded territory starting from 2025, even though we have some ongoing discussion for some certain accounts in these countries. But you should not expect too high revenue for the expanded in 2024. Please wait for 2025.
Okay, great. The second question related to timing of when the expanded number of Accept tests were to be commercially available in the U.S.
Yeah. So that, as Fredrik also commented, I think we are expecting to see most of the initial onset of that during 2025. And for that, obviously, there's a number of adoption aspects that are being made now with customers. But again, lots of great traction also on those new indications that are being made on customer sites today, especially in the U.S. and Europe. So there will be a lot of that that you'll read about and see during the remainder of the year, and that will kick off the revenues for 2025 on those new indications.
Okay, great. And obviously, Thermo Fisher collaboration expanded both in terms of products and geographies. But in general, it looks like your products have commercial traction in the U.S., and you have a portfolio beyond the transplantation portfolio. And you still only have three people in terms of your headcounts in the U.S. Obviously, you have your CLIA lab, but would it make any sense in your view to expand the number of distributors selling your product portfolio in the market, breaking it up by indication, cystic fibrosis or RHD screening, or would it make more sense for you to keep it in-house and just go for potentially more high-valued tenders?
Good question, Ulrik. And something we're actively assessing day in, day out as these opportunities come by. We have been approached several times by some very significant partners, potential partners, and yet decided that we were better suited to deliver on these opportunities ourselves. That being said, we're constantly, I'd say, in dialogue with very attractive opportunities that could make us pivot a little bit. And obviously, the reason we're only three currently in the field organization of the U.S. is because we're careful in terms of the investments, and we're still very confident about the opportunities, right? So when those opportunities, they will turn, you'll see that we will be investing in an increased fashion in the U.S. But for the time being, we're confident with the level that we have versus the potential that are coming ahead of us.
Great. Some additional questions on the general commercial activities, but potentially we could keep our eyes on the U.S. and on the CLIA lab. So internally in your CLIA lab, what's your current commercial traction? How are things progressing? And what type of revenues are you expecting prior to obtaining reimbursement in the U.S.? And I heard throughout the call that you have invested in people specializing in the matter of obtaining reimbursements. So where are we at in that progress?
We're probably for the reimbursement, if we just look at that, the initial products that we have commercialized are the RHD tests. And now we're seeking reimbursement for our chimerism and our Accept cfDNAs, so the two transplantation products. And those two products are not covered by the Thermo Fisher agreement, right? Those we have retained exclusive rights to be commercializing through and from our laboratory. And those are the efforts that we're now investing in in terms of getting those covered and reimbursed in the U.S. Timelines can be a little bit fluffy, but we're hoping that early next year, you would see that we have those products covered, and then we would see volumes quite quickly start to be generated. In addition to that, there's a number of opportunities for adding new products.
One of the products, there are two products currently being worked on, and that's the test for cystic fibrosis, but also the test for thalassemia. Then there could naturally be additional products, but there could also be additional partnerships like the one we have with Cyted, as we disclosed, generating up to SEK 25 million just on that one opportunity. It is meant to be a widespread and wide-focused catalyst for growth in the U.S., and it's shown to be also.
Great. And last question on my end, and it would be kind of a follow-up question as well. If you could talk a little bit about phasing of revenue in the second half. We already talked about Thermo Fisher, but if we can talk about the delivery of the already awarded RHD tender in Canada as well as the Cyted commercial contract, how should we look at this for the second half of the year?
Maybe I can say a couple of words there. It's always difficult to talk about single quarters because it can be delayed from the customer. What we said and what I said earlier is that we are rather confident that we can maintain the same growth during the second part of 2024 that we had during the first six months of 2024. And that's in local currency. And as you know, we had a growth of 34% for the first six months. So we are confident that we can maintain at least the same during the second part of the year. And I think we prefer not to say something about single quarters because it can always be, yeah, delays. But if you look at two quarters, it's easier to say these things.
Okay. You do expect some deliveries on the Cyted contracts and as well as in the RHD screening awarded already in Canada during the second half of the year. Or is there risk that this will be pushed into 2025?
I'm sorry. I'll say it, Theis. So you're right, Ulrik. So, the vast majority will happen in 2025, right? But that will also mean that we are starting to see the ramp of into volumes and revenues here during the second half. But the biggest chunk of that potential sits in 2025. With regards to RHD testing in Canada, that also is more of a 2025 opportunity. As there have been some delays with Héma-Québec, as we have already communicated, but as I also mentioned in my walkthrough of the commercial update, we actually just landed another account up there. And I'm still waiting for some details before I can disclose much more, but I wouldn't expect that that would have a great impact in 2024. But it's going to be building on our accumulation of growth in 2025 and beyond.
Great. That was all questions on my end. Thank you very much.
Thank you.
The next question comes from Oscar Bergman from Redeye. Please go ahead.
Good morning, guys. I just have a few questions to you. I was looking at the number of employees, and it has gone up quite a bit since Q2 of last year. So if you could just give some commentary on your organizational, well, I guess, increase.
Yeah. If you look one year back, of course, it has gone up quite heavily. But if you look at the Q1, it has not done that. We have invested in supply chain quite heavily because we are building up for future growth. We have also invested quite heavily in our commercial organization. So that's the two main drivers, I would say. We have added some special competencies. We have already talked about reimbursement and market access in the U.S. So that's that kind of expertise that we have hired. We do not, however, expect to have any substantially more hires during the remaining of the year.
Okay. Could you just give an update on the CLIA lab in terms of it running on a profit?
No, it's not yet running on a profit. I think we shared at the last earnings call that we expect positive numbers during the second part of the year, and we have started that part of the year. So it's still run with a loss, but it's not a huge loss. We have 4, 5 people in the lab, and we have now started to work both with Cyted, but also the other things that we have disclosed here. We have some ongoing discussions. The other ones, they have not started to generate revenue yet, but we are optimistic that they will do that during this year. So we remain with what we said earlier, positive during the second part of the year.
All right. Thanks. My next question is a bit speculative, and I guess you can't really tell so far. The Cyted deal, do you stand a good chance of it being renewed? And if it could be renewed, should we expect similar sales figures going forward, or could it even be greater?
Maybe it's a question to you, Theis. But please also remember, just like for Thermo Fisher, we cannot always disclose what has been discussed between a partner and us. But maybe you can give some more color here, Theis.
Yeah. I mean, right now, the agreement covers two years, right? So 2024, 2025. I see no reason for why it couldn't be extended. And I'm back in the States in mid-August, both in California, but also in the lab, and we're together with Cyted, actually, in the lab. But it's too early to be communicating more than just that. But it's moving along well. I mean, both parties are very happy with the engagement.
Okay. Just a final question then on the Thermo Fisher deal. I mean, I understand the lead time of 12-18 months since the initial signing before we can see any considerable sales developments. Apart from this, are there any other bottlenecks that we should be aware of that could hinder sales from growing?
On my side, I think that's the natural lead time, right, which is what we're in. But beyond that, what really excites me about this opportunity is that we're also changing the care of which transplant patients are looked after, right? And here, especially how we can protect the organ from being rejected. So we're also working on building up a lot of evidence for why monitoring is important. And that also takes some time. But if you call upon some of the key opinion leaders, you will hear that what we have going currently is very, very exciting and could be game-changing in the way of caring for transplant patients. So that's why we are super excited about what's to come, and we're very confident that it will come. It just takes the natural time. This doesn't happen overnight.
Okay. Thanks. Yeah. I think that's all from me.
Thank you, Oscar.
The next question comes from Ludwig Landgren from Nordea. Please go ahead.
Hi, Fredrik and Theis. On the EMEA countries, we're currently establishing direct sales channels such as in Germany, Spain, and France. How has the development been here? Have the dynamics been similar to when you established direct sales in Italy?
Did I cover that one, Fredrik?
Yeah, please, please.
Yeah. I mean, yes, in general, it replicates. So you heard me say before in some of the earlier calls that when I take the growth curve from when we initially started going direct in Italy with what we're doing in the DACH region, Benelux, UK, and so forth, the curve of growth looks the same. That being said, as we also had written in the report, we had expected more growth in the direct markets of Europe. But again, very, very sure that this will absolutely come. So we are posting some 30%-34%, I believe, in the direct markets. And obviously, we're expecting +50%. Some of those markets, we want to see doubling. But we're working on getting there.
But again, when I look at what we have done in the larger markets, like the DACH region and the Benelux and so forth, it looks very, very solid. And now we're doing the same in France. We're doing the same in Spain, doing the same in the UK, which is a little bit later on in that growth curve that we are working on. So I'm confident these markets will also be replicating what we have done in Italy.
All right. Great. Thanks. So when you switch to these direct sales, you get this price effect, right? But would you say that this typically is also driving volumes? Have you seen that also in these new markets, that volumes increase when you establish direct sales channels?
Yeah. Usually, that should happen, right? The initial effect is obviously on the price side where you convert from a distributor to direct sales. That has an incremental value effect. And then as you get closer to customers, you build a relationship, you're closer in tenders, then volumes are also coming, which we are also confirming when we look into our numbers.
All right. Great. And then just a final one on the interest from pharmaceutical companies that you mentioned on the thalassemia test. Is a potential outcome from this that the test could be used as a companion diagnostics, or are there other use cases for the tests?
That's too early to comment, but that I would encourage you to look into because that market and the companies that are working within sickle cell disease and working with thalassemia is very, very interesting. We have one of the best products out there, I'm confident. I think we are very well suited, actually, to partner and be a strong partner to pharmaceutical companies.
All right. Great. Sounds exciting. Thanks for taking my questions.
Thank you.
As a reminder, if you wish to ask a question, please dial pound key five on your telephone keypad. There are no more questions at this time, so I hand the conference back to the speakers for any written questions and closing comments.
In these earnings calls, even if it's holiday times for most people in Scandinavia, at least. I hope you will have a nice holiday, and let's get in touch later in the fall when we have our third earnings call for this year. Thank you.