Good day, ladies and gentlemen, and thank you for standing by. Welcome to the Badger Infrastructure Solutions Ltd. 2022 first quarter results conference call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question-and-answer session. To ask a question during the session, you will need to press Star, then one on your telephone keypad. As a reminder, this conference call is being recorded. If you require any further assistance, please press star, then zero. At this time, I would like to turn the conference over to Mr. Paul Vanderberg. Sir, please begin.
Thank you. Good morning and welcome to Badger's Q1 2022 earnings call. On the call with me this morning is Rob Blackadar, our Chief Operating Officer, and Darren Yaworsky, our CFO. Our 2022 Q1 earnings release, the MD&A, and the financial statements were released after market close yesterday and are available on our website, the investor section, and also on SEDAR. We are required to note that some of the statements made today may contain forward-looking information. In fact, all statements made today, which are not statements of historical fact, are considered to be forward-looking statements. We make these statements based on certain assumptions that we consider to be reasonable. However, forward-looking statements are always subject to certain risks and uncertainties, and undue reliance should not be placed on them, as actual results may differ materially from those expressed or implied.
For more information about these assumptions, risks, and uncertainties that may be relevant to such forward-looking statements, please refer to our 2021 annual information form. As always, we'd like to start the call with health and safety. We've been pleased with the team's health and safety response to the now two-year-old COVID pandemic and the related challenges that have come along with it from an operating perspective. Under all conditions, safety of Badger employees and customers remains job number one. We are pleased with how the team has managed through this pandemic. Our COVID playbook consistently follows our Centers for Disease Control guidelines and our commitment to a strong health and safety culture, led by Rob and Leon Walsh, our Vice President of HSE. This has allowed us to manage through any conditions that we've seen with COVID.
We continued to manage through those conditions in Q1. The first half of the quarter was impacted by the Omicron variant outbreak and the restrictions that went along with that. As we indicated on our Q4 2021 call, January saw about 8%-9% of our operators in quarantine at some point during the month. This was a similar level to the August and September peak with the Delta variant. Having operators in quarantine results in lost revenue and higher direct labor costs, including more overtime and higher subsistence costs for more out-of-town work, with longer travel times and overnight stays. That was the first half of the quarter. However, the second half was very different. February case counts were down about 80% from January, and in March, we only saw about 16 cases. None of our Q1 hit cases required hospitalization.
Cases in April and into early Q2 are trending at the lower levels as well. Very positive. We're also encouraged that the Centers for Disease Control and most jurisdictions have loosened operating restrictions and shortened return-to-work testing procedures. Despite all of this, though, we continue to follow our COVID playbook and some regions have seen small amounts of infections, but the general trend is down. Our business and financial results, which Rob and Darren will speak to in a few minutes, mirrored the COVID trends in the quarter. The first half of the quarter was below our expectations, and the second half exceeded our expectations. Overall, we managed to meet our initial expectations for the quarter, and we're pleased to see revenue and operating leverage improving. Revenue was up 33% from the previous year, and adjusted EBITDA was up 84%.
We're also encouraged by improving trends in the broader non-residential construction market fundamentals, particularly in the U.S.. After 15 months of consecutive year-over-year declines in the non-U.S. non-residential construction put-in-place numbers, the market trends appear to be returning to year-over-year growth, albeit the lower levels. The growth is occurring off the lower levels we experienced in 2020 and 2021. With that, we'll hand the call over to Rob to discuss the quarter.
Thanks, Paul. As Paul mentioned, we are pleased with the continued market and business improvement during the quarter, despite the slow start due to Omicron. Revenue was up approximately 33% from last year to $114 million, which continues to reflect the market recovery that we have seen in the second half of 2021. I would like to remind everyone that we have transitioned our reporting currency to U.S. dollars from Canadian dollars, effective January 1, 2022. Higher revenue and more consistent volume in the second half of the quarter supported improved operating leverage. All operating regions experienced positive leverage from higher revenue, higher utilization, increased pricing, and cost controls. This resulted in a year-over-year improvement in adjusted EBITDA margin from 5.1% last year to 9.4% this year.
Q1 revenue per truck per month, or RPT, was $31,571, which was up over 37% versus last year. A higher percentage increase year-over-year than revenue. This reflects our continued focus on fleet utilization. Better fleet utilization also translates into improved labor utilization. We ended the quarter with 1,335 excavation units, compared to 1,359 at the end of Q1 2021. This also contributed to our increase in RPT. We added 16 units and retired 40 units in Q1 as well. Badger continues to target a 2022 build program of between 150-180 units, and retirements between 40-60 units. The build program is sized to capitalize on our recently launched commercial strategy rolled out across our branch network.
As Paul mentioned, we'll be providing updates to our commercial strategy, our operating model, and our manufacturing capabilities at the virtual annual general meeting later this afternoon. I will provide some brief highlights now. In Q1, we realigned our operations group into four regions, Canada, U.S. East, U.S. Central, and U.S. West. Badger has historically been a very decentralized business with local and regional management and focus, and we now have evolved that decentralized structure into a standardized operating model. We resized the regions and market areas to capitalize on the growth opportunities within our strategic and core markets. This structure will maximize our ability to drive revenue, scale the business, focus our resources, and flex our operating leverage. The new region and market area structure was implemented at the beginning of 2022, and all positions were staffed and resourced before the end of the quarter.
As part of these changes, we've equipped our branches with additional sales and marketing capabilities. These capabilities focus on customer opportunities within key market areas and with our national accounts, leveraging our size and scale across North America. This is a key differentiator between Badger and our local and regional competitors. Badger continues to view its vertical integration as a competitive advantage. As we have previously shared, our manufacturing team has positioned the Red Deer plant for higher production levels. We believe that we will be able to source major manufacturing components for the balance of the year despite the many supply chain challenges in the market. Market indications suggest that nondestructive excavation equipment will be in high demand and more difficult to source over the next several years, which makes Badger's vertical integration that much more valuable. Our vertical integration also allows us to innovate new products.
I'm excited to share that we are field testing the new Badger Airvac, a new product in our nondestructive excavation lineup. The Airvac operates similarly to the Hydrovac to perform safe excavation. The Airvac uses air versus water to loosen the cover soil before vacuuming it into a storage tank. This application eliminates the use of water and assists in materials management. This new tool further strengthens Badger's service offering and should expand customer uses for nondestructive excavation. Even though COVID has resulted in delays in projects, customer spending, and non-residential construction activity, we see pent-up customer demand, and Badger is well positioned to capitalize on this demand for the balance of 2022 and beyond.
Unless there are additional geopolitical or macroeconomic disruptions, we see conditions continuing to be favorable for continued progress in growing the business, improving our operating leverage, and returning to historical margins as the recovery continues to execute on our commercial strategy. Now, I'd like to turn things over to Darren to discuss our Q1 financial results.
Thanks, Rob, and good morning, everybody. As Rob mentioned, our revenue in the quarter was $114.1 million, up 33% from the same quarter in 2021. Our gross margin was 18.4%, representing a 270 basis point improvement compared to the 15.7% achieved last year. As Rob mentioned, we continue to invest in key sales and operations personnel and our commercial strategy in anticipation of a market recovery. G&A expenses were approximately $10 million for the quarter. These costs were modestly higher than last year's level to support the completion of the legal entity reorganization and the MRP system implementation, both of which went live on January 3 of this year.
We continue to anticipate our normalized G&A run rate expense to be approximately CAD 40 million, as we have previously shared. Adjusted EBITDA was CAD 10.7 million for the quarter, compared with CAD 4.4 million last year. Adjusted EBITDA margin increased to 9.4% from 5.1%, representing a 430 basis point improvement year-over-year. These margin levels continue to reflect investment in key sales and operations personnel in anticipation of the market recovery, and we expect this to continue over the balance of the year. Now onto the balance sheet. Badger maintains a focus on ensuring the strength of its balance sheet and its financial flexibility. We have continued to make meaningful progress in working capital, in particular accounts receivable management, and the collection of our long-dated receivables.
At the end of Q1, nearly 80% of our receivable portfolio was aged less than 30 days, resulting in a DSO of approximately 75 days. We believe there's still room to improve on this, and we're continuing to work towards better numbers towards the end of the year. In January, we repaid the final installment on our senior secured notes with Prudential, resulting in all of our debt consolidated within our five-year committed credit facilities. We continue to maintain our Canadian CAD 400 million in committed credit facilities, which provides ample liquidity and financial flexibility to fund both near-term and long-term growth and complementary capital allocation decisions. Finally, I'd like to remind everyone of some of the changes that we made for Q1 reporting period. Effective January 1 of this year, we changed our reporting currency from Canadian dollars to U.S. dollars.
This change minimizes the impact of foreign currency fluctuation as over 80% of our revenue is in U.S. dollars. Effective with the March 31, 2022 dividend payment, we have moved from monthly distributions to quarterly distributions. Our Q1 cash dividend of $0.165 per share was paid on May 15 to shareholders of record on March 31. Effective January 1, 2022, we revised the methodology in which RPT is calculated. We're excluding finished nondestructive excavation units which have not been sold to the transportation entity from the manufacturing entity. Additionally, RPT now reflects the gross revenue earned on units which are operated by our operator partners and franchisees versus the previous reported net revenue. We believe these changes more accurately reflect the utilization of our fleets. With those comments, I'd like to turn the call back over to Paul.
Okay, thanks, Darren. Before we open it up for questions, a couple of comments. The quarter continued our recovery from COVID. We were very pleased with the operational performance that we saw in the second half and what we've seen so far going into Q2. We remain focused on our markets and our customers and managing our expense levels while ensuring we have the trucks available for our customers. Our view of the significant U.S. and Canadian long-term opportunity for non-destructive excavation and our long-term growth prospects is unchanged. We believe that the focus on infrastructure in the U.S. supports demand for additional and significant additional non-destructive excavation. We stand ready to help strengthen and maintain that infrastructure and also to support adapting that infrastructure to new technologies from sustainable energy and other related technologies.
Our proven business model, our operating scale, our flexibility, diversification of end use and geographic markets, combined with our strong operating track record across the economic cycle, support achieving our long-term growth aspirations. We are making the business moves required to position Badger to take advantage of this opportunity, and as always, we manage the business for the long term. We would also encourage everyone to join our virtual AGM, which will be held later this afternoon, where Rob will share some updates on our commercial strategy, operating model, and manufacturing, and Darren will share updates on our financial strategy. If you're unable to join the AGM, a link will be posted on our website. With those comments, let's turn it back to the moderator for questions.
Ladies and gentlemen, if you have a question or comment at this time, please press star then one on your telephone keypad. If your question has been answered or you wish to remove yourself from the queue, simply press the pound key. Again, if you have a question or comment at this time, please press star then one on your telephone keypad. Our first question or comment comes from the line of Yuri Lynk from Canaccord Genuity. Your line is open.
Hey, good morning, everyone.
Hey, Yuri.
Hi, Paul. Maybe just talk about staffing levels across the organization, how you feel you're staffed up for what sounds like gonna be a pretty busy Q2 and Q3? Do you feel like you've got the adequate operators in place and trained up, or are you still in recruiting mode?
Yep. Well, I don't think we'll ever not be in recruiting mode at Badger and that's a real positive thing. We think we're very well positioned for the summer season. You know, as you and a lot of other followers of Badger know, we paid the price for that to be ahead of the game on operator availability and recruiting. We're looking forward to a couple of quarters with a run where that pays off. We're pretty excited about what we see coming for the rest of the year.
Yeah. That's a good point. I mean, obviously, you've got a lot of wood to chop between now and the seasonally slower Q4 and Q1. How are you gonna be able to handle in this tight labor market having to flex your workforce in those slower periods in order to better protect your margins than what we've seen in the last two years?
Yeah. Well, you know, I think there's a couple of things from my perspective, Yuri. You know, it's the disruptions and the big up and downs that have really been the challenge. To the extent we have steadier demand and demand that's more reflective of traditional seasonality, you know, I'm very confident that the ops team will manage that. The thing that we've really had the challenges with is the up and down with the Omicron and the Delta variants. You know, we talked about it with Q4, with the way December ended up and the way January started out. You know, we really had a great illustration of that with Q1, where it was almost two different quarters entirely.
The first half was significant labor challenge, and the second half we got some momentum back and more than made up the shortfall in January in the month of March. You know, we've seen it, we've lived it. To the extent we don't have those type of disruptions, we're very confident that the operating leverage will start to reemerge.
Okay. I've got some other questions, but I'll hop back in the queue and maybe circle back.
Okay. Thanks, Yuri.
Thank you. Our next question or comment comes from the line of Michael Doumet from Scotiabank. Your line is open.
Hey, good morning, guys.
Hey, Michael.
The first question's on margins here. You know, we've seen COVID ease as you commented, Paul. It looks like demand is ramping up. You talked about better utilization pricing cost. You know, the environment and operating momentum feels like it's taking a turn. I just wonder, you know, if you can discuss how, you know, the second half performance in Q1, you know, how far that is away from where you need to be to get back to historical margins?
Yeah. No, that's a good question, Michael. I can't provide too much granularity on that. You know, I would say we're not satisfied with the level where we are yet. We do have a ways to go. That's just the fact. This is a real focus for us, and it will continue to be a focus for us. I can't give a whole lot more granularity than that. The momentum into Q2 and what we're seeing gives us quite a bit of optimism that we're gonna continue to grind away back toward our historical margins.
As we have said, as we get more better demand, number one, and number two, stability of demand, that's when we have a chance for Rob and the ops team to really get the operating leverage going.
Okay. That's helpful. I guess to segue to how you answered that last part of the question. How significant is the interplay between utilization and price? I mean, can you go back to your customers and ask for more, not just some fuel but, you know, maybe labor recovery without necessarily selling out? I'm just wondering how much utilization or pricing leverage you currently think you have?
Yeah. Well, let's put Rob to work a little bit here on that one, as he's leading our commercial strategy. Great question. Rob?
Yeah. Michael, we see opportunities throughout the business and in most of our markets. Certainly, the demand has picked up, and the phones are ringing, they're ringing pretty strong. For us, as we are capitalizing and we're filling up all of our trucks and all of our dispatch are busy every single day, we've been training and teaching about making sure that we start to focus more on dynamic pricing rather than fixed or static pricing, especially in those higher demand markets, and we're in several of those. Because of that, we're starting to see improvement, and we're very encouraged by that. But it's extremely tied together. As that.
I have a background in asset-heavy rental businesses and all tied to utilization and pricing. As I've gotten to get more involved, Michael, I've identified that the opportunities are really strong here at Badger, and it's really training and coaching and teaching our teams. So far, they've been very receptive. It was a little harder to do in the wintertime, obviously, but as the spring and the summer demand is starting to ramp up, we feel very encouraged by that.
That's really helpful. I guess, like Yuri, I'll toss it to you and pass it on.
Okay. Thanks, Michael.
Thank you. Again, ladies and gentlemen, if you have a question or comment at this time, please press star then one on your telephone keypad. Our next question or comment comes from the line of Jonathan Lamers from BMO Capital Markets. Your line is open.
Good morning.
Hey, Jonathan.
Hi, Paul. Are the fuel surcharges that were put in place covering increased diesel costs now?
Let's turn that one over to Rob again. We've had really good success with the fuel surcharges, and I think Rob can cover this. His team's done some great work in the last couple of months.
Hey, Jonathan. You know, as what happened over with Ukraine started to really change the dynamics in the fuel markets and what was happening with fuel very quickly.
We recognize and realize that we had this fuel recovery surcharge or fuel recovery fee that we pass along to our customers. It really is pegged to the cost of diesel. It's pegged both in the U.S. side and the Canadian side of our business. As the cost of diesel started to spike up, we actually sent out communications to all of our local customers, and we actually had one-on-one meetings with our national account customers. We basically said, our cost is going up so dramatically on diesel. We have to continue to change our fuel recovery fee to flex up with those costs.
We actually started pegging, instead of monthly, to what the change in cost is to weekly. So far, the take rate on that has been very good across the entire organization. Just like our customers, we don't like a fuel surcharge more than no one likes that. No one is excited about taking that, but they're all realistic because almost every one of our customers is running equipment or running trucks with diesel in it, and they all understand. We've actually had a few customers tell us that they were kind of waiting on us to change the peg from monthly to weekly. So far it's worked out pretty well. I know it's a long answer to a short question, but we've actually seen pretty good success in this in the last 45-60 days.
Thank you. Our next question or comment comes from the line of Trevor Reynolds from Acumen Capital. Your line is open.
Hey, guys. Just wondering if you could give a few more details on the Airvac truck that you guys are talking about in the press release.
Yeah. No. Happy to Trevor. You know, everyone knows that our vertical integration starts with truck design, and that starts with feedback from our customers and our operators, and that's a real advantage that Badger has. The Airvac really comes out of that whole ecosystem and the process of feedback from our folks on the trucks and our customers. What Airvac does is rather than high pressure water, it uses compressed air to loosen the soil, and the vacuum system is generally the same. There's a little bit difference in dust collection, but it's generally the same. It's a similar nondestructive excavation technology, just using a different way to fracture the soil.
There are a range of advantages with Airvac, and there's a range of disadvantages with Airvac. It basically doesn't create slurry and gives the customers options to put the soil right back in the hole, and manage their materials in a different way than the Hydrovac slurry. It's not gonna be for everybody, and it's not gonna be for every potential application, but it adds another arrow to our quiver. We expect to see very good uptake in segments like the pipeline segment, inner cities where there's impacted soils, you know, places like Boston that have been around for hundreds of years and people don't know what's in the soil. We think there's gonna be some really good opportunities that come along with that.
This is just another one of Badger's leading technologies, like we developed over the years, you know, we wanted to start to talk about it this quarter because we're seeing some good response from customers and from our prototype units that are out there, also because we're gonna start to build more of them. We are gonna be reporting them along with our Hydrovac truck build. We just wanna provide that transparency. Very excited about it, and I'm really looking forward to how this rolls out.
Got it. You'll just be including those with the Hydrovac numbers?
Yeah, that's correct.
Yeah. Okay. Just to be clear, did you guys say there was 40 retirements in Q1?
That's correct.
Okay. You're still comfortable with the 40-60 retirements for the year?
Yep. That's what we're planning on. Obviously, we'll update that each quarter just like we do our build rate. That's the plan.
Got it. I'll pass the line back. Thank you.
Okay. Thanks, Trevor.
Thank you. Our next question or comment is a follow-up from Mr. Jonathan Lamers from BMO Capital Markets. Your line is open.
Thank you. On the difference in margin between the first half of the quarter and the second half, maybe coming at it a different way. Darren, would you have an estimate for all of the COVID costs included in direct costs for Q1?
I wouldn't have it at the tip of my finger, so it'd be a bit of a guess. Maybe coming at it from a different way. The full quarter's 9.4% EBITDA margin would be an average that's probably weighted a little bit below the simple average. That's about as far as you're gonna get out of me on the margin discussion. I'd have to leave it at that because it's difficult to be able to say what your COVID expenses are because there's foregone revenue and additional costs. It's not as simple as saying that there's a cost increase that allowed us to actually pick up the same level of revenue.
We actually had to forego revenue because we didn't have the availability of people to do the work.
Yeah. We did say earlier, Darren, that we more than made up for the January fourth shortfall in March.
That's right.
That's some color I think that might be helpful too.
Okay, that's great. Thank you.
Thank you. Our next question or comment is a follow-up from Mr. Michael Doumet from Scotiabank. Your line is open. Mr. Doumet, you may need to unmute your phone.
Oh, here I am. All right. Still figuring out the phone, but thanks for the follow-up, guys. I guess, you know, I think you talked about, you know, some areas where there's a lot of activity? You know, I was wondering how much activity or how much more activity you're seeing in the oil and gas space, and, you know, whether or not that's been enough to potentially tighten the rest of the market up a little bit in terms of capacity?
Yeah, Rob, you wanna jump in on that one?
Yeah. Michael, I know the company historically had been pretty heavily invested in oil and gas, and over the years, through the up and down cycles, and like a lot of the industrial companies, have lightened our dependence on oil and gas. We have seen some of the end markets and our end customers in oil and gas pick up, and certainly we've benefited somewhat from that, but it's not tightening up our entire fleet across the board. It's only helping us in those oil and gas markets in which we operate. We are seeing a lot of just customer demand across almost all verticals and industries. I'm trying to actually think of one, Paul, that's an exception. I mean, there-
No, there's-
Yeah, we're seeing it everywhere, and I think it's because people are coming off of two years of COVID, and they have a lot of work to catch up on. I wouldn't say, Michael, that oil and gas is tightening up our utilization, but certainly in our markets where we operate and you know the usual ones, in those markets, certainly we've benefited, but that's not driving the utilization across the company. It's just all across the board demand from the broad customer base.
It is a headwind we've had for about four or five years that's now not a headwind anymore, so very positive from that perspective.
Yeah. Great question.
Thank you.
Thank you. Our next question or comment is a follow-up from Mr. Yuri Lynk from Canaccord Genuity. Your line is open.
Hey, guys.
Hey, Yuri.
Can you confirm the retirement? You said 40 retirements, and you added 16 trucks. Is that right?
That's correct. Yeah.
Okay.
Yeah, we shrunk the fleet slightly in Q1.
Okay. Maybe I'll follow up offline, but I'm getting the math kind of indicates 51 retirements based on the ending fleet count at the end of Q4.
I was talking about maybe average units during the quarter.
Yeah.
Yeah.
Yuri, we should probably take that offline, and we could just reconcile the numbers for you.
Yeah.
Okay. I dropped off the call for a minute there. Did anybody follow up on the new RPT disclosure?
No, no one asked any questions on the RPT.
Okay. Well, I'll take the opportunity. Just wanna make sure I understand. You're now gonna be including that 60% of operating partner revenue. I guess the thinking is that the fleet, even that operator fleet, is all in the denominator. You're better trying to match the numerator with the denominator. Is that it, even though the economic revenue to you is gonna be a bit overstated?
That's correct. The economic revenue that we have is still our economic revenue, but to really compare apples to apples of a corporate versus OP or franchise fleet, we really have to make sure that the utilization is measured off the same base. The logic that you went through is absolutely correct.
I guess the end result is kind of 3% point lift in RPT?
No.
Versus-
It's gonna be higher than that. It would be pretty materially higher than that in Canada. Yeah, it would be more than that. I don't have the percentage differential between our old calculations and our new calculations, but it would be higher than 3%.
Okay. Maybe just realign the guideposts. I mean, I think historically you would look to start building trucks when you saw RPT kind a get in that 30-35,000 range. I mean, what does that look like now, just so we can get our bearings here?
I don't think that's really changed. I think we've seen the writing on the wall with all of the utilization work that we did last year and the, you know, when we put out our Q4 numbers and our build guidance of 150-180 trucks. That was on the visibility that we were seeing RPT creeping up over 30.
Okay. I guess my point is. Anyway, we'll take it offline. I guess it's a bit inflated now, right, versus the old metrics, RPT?
No, I think the metrics now are probably more realistic of how we're running the business. You know, RPT is RPT, regardless of how you're trying to reconcile it back to the economic cash flow that we get from the OP franchise arrangements. The decision-making that we would look at is always the core RPT of the business. Now we're, you know, aligning the external disclosure with how we actually operate the business.
Okay. Sounds good.
Thank you. Our next question or comment comes from the line of Krista Friesen from CIBC. Your line is open.
Hi. Thanks for taking my question. I just wanted to follow up on the end markets. Are you seeing any weakness in any of your end markets just as concerns of a recession sort of loom or any difficulties passing through the pricing that you're hoping to get, just given inflation and all the other costs your customers are dealing with?
Yes. Krista, we haven't seen a lot of softness. Certainly like everyone on this call and everyone in our room in here, we're very aware of what's happening, and we listen to the news and hear of, you know, a lot of discussion of what the market potentially could go to. We haven't seen that softness yet in any of our end markets. It hasn't seemed to slow down our customer base yet. The thing that we're most optimistic and positive about on a go-forward basis is because we have a very clear commercial strategy and it's very basic. We're not talking high science here.
It's a very basic commercial strategy, but it's one that is company-wide, that we believe that in certain locations and branch locations we have, that if we're really strong in one industry or one vertical, we can begin to start to grow adjacent industries and verticals and customer bases that we've never done before. That should help us offset. Even if the market starts to slow down, we can continue to grow and find new customers and introduce safe dig technology and the concept of safe dig in the marketplace. 'Cause a lot of our markets, even really large ones, still don't fully understand how valuable safe dig excavation is. That is complete upside for Badger. We like being the industry leader there.
It's a great position to be in.
Great. Thanks. I'll jump back in the queue.
Thanks. Thanks, Krista.
Thank you. Again, ladies and gentlemen, if you have a question or comment at this time, please press star then one on your telephone keypad. I'm showing no additional questions in the queue at this time. I'd like to turn the conference back over to management for any closing remarks.
Okay. Thank you for that. Thank you everyone for your participation this morning. On behalf of all of us at Badger, we wanna thank our customers, our employees, suppliers, and of course, our shareholders for all of your ongoing support, which really drives Badger's success. We can end the call. Thank you.
Ladies and gentlemen, thank you for participating in today's conference. This concludes the program. You may now disconnect. Everyone, have a wonderful day.