Good morning. My name is Joelle, and I will be your conference operator today. At this time, I would like to welcome everyone to Keyera's 2025 First Quarter Conference Call. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question-and-answer session. If you would like to ask a question during this time, simply press Star, then the number one on your telephone keypad. If you would like to withdraw your question, please press Star Two. Thank you. I would now like to turn the call over to Dan Cuthbertson, General Manager of Investor Relations. You may begin.
Thanks, and good morning. Joining me today will be Dean Setoguchi, President and CEO; Eileen Marikar, Senior Vice President and CFO; Jamie Urquhart, Senior Vice President and Chief Commercial Officer; and Jarrod Beztilny, Senior Vice President, Operations and Engineering. We will begin with some prepared remarks from Dean and Eileen, after which we will open the call to questions. I'd like to remind listeners that some of the comments and answers that we will give today relate to future events. These forward-looking statements are given as of today's date and reflect events or outcomes that management currently expects. In addition, we will refer to some non-GAAP financial measures. For additional information on non-GAAP measures and forward-looking statements, please refer to Keyera's public filings available on SEDAR and on our website. With that, I'll turn the call over to Dean.
Thanks, Dan, and good morning, everyone. Keyera had a solid first quarter reflecting discipline, execution of our strategy, and the strength of our integrated value chain. Back in December, we outlined a clear plan to grow our fee-based adjusted EBITDA by 7-8% annually from 2024 to 2027. Five months later, we're progressing well against that plan, advancing growth projects, filling available capacity, and securing new long-term integrated contracts across our value chain. This morning, we announced the sanctioning of KFS FRAC III, a major expansion of our core FRAC complex in Fort Saskatchewan. When combined with the FRAC II de-bottleneck, these projects will increase our total frac capacity by about 60%. These investments are backed by long-term customer commitments with a high degree of take-or-pay and are essential to meeting the growing needs of the basin.
They also enhance the competitiveness of our integrated value chain and support our strategy of attracting and retaining volumes across the system. Both frac expansion projects are expected to deliver standalone returns within our targeted range of 10-15%. A large majority of frac capacity at KFS, including expansions, is now contracted for an average duration of eight years. We're also advancing CAP Zone Four with commercial discussions nearing completion. We continue to see commercial momentum across the business. The Wapiti Gas Plant is now expected to reach effective capacity in 2026, a year earlier than anticipated. Several optimization projects are underway to support further growth at the plant. Volumes continue to ramp up at Simonet, and our condensate business continues to grow. Our Fort Saskatchewan condensate system is nearing contractual capacity, and we're evaluating de-bottlenecking opportunities that can increase capacity to accommodate growing customer demand.
From a macro perspective, we remain confident in the long-term growth outlook for volumes out of Western Canada. Despite recent commodity market volatility, our basin remains resilient due to its quality of resource and low-cost structure. Importantly, we're seeing meaningful improvements in egress capacity across multiple products, whether it's crude on the Trans Mountain pipeline expansion, gas and LNG Canada, or increasing propane and butane export options. At the same time, intra-basin demand is rising. Oil sands producers are investing in expansions and de-bottlenecking. Over time, natural gas could play a larger role in meeting emerging demand from sectors like data centers. Our assets are well-positioned to enable this growth, and we'll continue to invest where we see long-term sustainable growth, always with a focus on disciplined capital allocation. With that said, for Canada to realize its full potential, more is needed.
We need a competitive policy environment that attracts capital, enables responsible growth, and expands market access for the benefit of all Canadians. With that, I'll turn it over to Eileen to walk through our financial results and guidance.
Thank you, Dean. Keyera delivered solid financial results in the first quarter. Adjusted EBITDA was CAD 298 million, compared to CAD 314 million in Q1 last year. Distributable cash flow was CAD 190 million, or CAD 0.83 per share. Net earnings were CAD 130 million, up from CAD 71 million in the same period last year. These results were supported by continued strong margin contributions from our fee-for-service segments, which were up 9% over the same period last year. Gathering and Processing delivered CAD 109 million in realized margin, with a new throughput record at Wapiti and continued momentum at Simonet. Liquids Infrastructure delivered a near record CAD 152 million in realized margin. This was supported by high utilization of our fractionation and condensate systems and the continued ramp-up of volumes on CAPs. In the Marketing segment, realized margin was CAD 78 million, primarily driven by isooctane and propane sales.
The AEF Facility has completed its startup following a maintenance outage that began in late March. The facility is now back to full operations. However, the work took longer than originally anticipated, extending to approximately seven weeks rather than six. As a result, the expected impact to annual Marketing segment realized margin has increased to approximately CAD 50 million, compared to the previous estimate of CAD 40 million. We ended the quarter with a strong balance sheet and net debt to EBITDA of two times, below our targeted range. Over the last two years, our net debt has been reduced by over CAD 500 million. Our strong financial position gives us the flexibility to self-fund organic growth and return capital to shareholders. Turning to our 2025 guidance, we are reaffirming all key figures. We continue to expect Marketing segment realized margin to be between CAD 310 million and CAD 350 million.
This includes the estimated CAD 50 million impact from the AEF Facility outage and reflects the benefits of our disciplined risk management program. Growth capital expenditures are expected to range between CAD 300 million and CAD 330 million, supporting investments in FRAC II, FRAC III, CAP Zone Four, and other opportunities. Maintenance capital expenditures are expected to range between CAD 70 million and CAD 90 million. Finally, cash taxes are expected to range between CAD 100 million and CAD 110 million. Thank you, and I'll now turn it back to Dean for closing remarks.
Thanks, Eileen. We remain confident in the basin's continued volume growth. Canada has one of the world's largest oil and gas resource bases, developed under some of the most stringent environmental and social standards anywhere. Now is the time to foster an environment that attracts investment and supports responsible growth. Our customers are in strong financial positions and continue to grow and adapt to changing conditions, and Keyera helps enable this growth. We are executing a clear strategy and delivering capital-efficient growth, and we're doing so while remaining disciplined with a long-term view of the Western Canadian Sedimentary Basin. On behalf of Keyera's Board of Directors and Management Team, I want to thank our stakeholders for the continued support. With that, I'll turn it back to the operator for Q&A.
Thank you. Ladies and gentlemen, we will now begin the question and answer session. Should you have a question, please press Star, followed by the one on your touch-tone phone. You will hear a prompt that your hand has been raised. Should you wish to decline from the polling process, please press Star, followed by the two. If you are using a speakerphone, please lift the handset before pressing any keys. One moment, please, for your first question. Your first question comes from Robert Hope with Scotiabank. Your line is now open.
Thanks. Good morning. This is Jess Hoyle on for Rob Hope. I just wanted to start on the growth front. Regarding CAP Zone Four, what are the remaining hurdles for sanctioning, and are you now comfortable on the engineering side and also with construction costs for that project?
Hi, good morning. Jess, it's Dean Setoguchi speaking, and thank you very much for the question. We're very excited about our Zone Four project, working with North River Midstream. We certainly see a lot of demand and growth in the Montney, and therefore, certainly a service like ours, which would provide a competitive alternative for NGL transportation. Contracting is going very, very well, but we want to remain disciplined to make sure that we have all of those contracts buttoned up that will support this size of investment. As I said before, that's progressing very well. On the engineering front, we have a Class Three estimate already complete. We've done all of our stakeholder engagements, and we feel pretty good about our execution of this project.
I was thinking back about CAP Zone One to Three, and we've said this before, but the terrain on Zones One to Three are much more difficult to build pipe in and build a pipeline in. Zone Four is much smaller in size. Its distance, it's only about 85 km versus about 580 on Zones One to Three. The topography is a lot flatter, and the right-of-way is visible pretty much the whole distance from a paved road. Much, much different conditions. I'll also say that, remember, in CAP Zone One to Three, we built that through COVID, and we also had two very large pipeline projects being built at the same time, being Trans Mountain and Coastal GasLink. Just because of the availability of contractors and also the smaller projects and better topography, we feel pretty good about it.
Jarrod, is there anything else you want to add to that?
Yeah, I think you covered it well, Dean. The only couple of things I'd add would be that we have all our regulatory approvals in hand already, and we've secured the pipe and are in the final stages of securing our construction contractors. There will be some continuity there from Zones One to Three. Both from our own team and the external folks that we use, there's lots of familiarity there from the prior project.
Thanks for that. Moving over to marketing, commodity prices have been very volatile. Just how do you think about downside protection, or does volatility give upside potential to the guidance range?
Yeah, maybe I'll start off with this response. Certainly, we've seen a lot of volatility, as you said, and a lot of it's tied to what President Trump says on any given day across the border. I just want to remind our investors that we have a very, very disciplined risk management program. That is in place to protect ourselves when we see a downturn in commodity prices like we've seen recently. That is working very well for us, as it did back in 2020 and 2021. Maybe I'll just throw that over to Jamie, and maybe he can comment further.
Yeah, Dean, you've covered it really well. As you pointed out in the last part of your question, that volatility sometimes does create opportunities for us to be opportunistic when we do layer in our risk management program. The team, as they have in the past, has done a very, very good job of setting us up for 2025 and into 2026.
Appreciate the detail. Thank you.
Thank you. Thanks for the question.
Your next question comes from Robert Catellier with CIBC Capital Markets. Your line is now open.
Hi, good morning. I think I'll start with KFS III. Congratulations on the sanctioning. I just wanted to understand the CapEx guidance that you previously gave for 2024 to 2027. Obviously, it includes something for KFS III, but it looks like the scope of the project might be a bit bigger with some additional egress. Is the entirety of the CAD 500 million accounted for in that prior guidance of CAD 350-450 million for 2026 and 2027?
Yeah. You know what? I'll just turn that question over to Eileen right away, Rob. I'm glad to see that you're still on the phone after the Leafs loss last night, and hopefully, it bounces back next game. Anyway, I'll turn that over to Eileen.
Hi, Robert. Thanks for the question. Yes, absolutely, the CAD 500 million for FRAC III was part of that guidance that we provided for 2024 through to 2027. It would include both the FRAC II de-bottleneck, FRAC III, CAP Zone Four, as well as other projects. As you can imagine, it takes several years to develop projects to get them to in-service date and really to be able to push out that growth well beyond 2027. There is some capital for other projects as well.
Okay. What is the addition you are doing on the egress side with KFS III? Is there anything notable there? Is it just connectivity to storage, things like that?
Sure. I'll turn that over to Jarrod.
Morning, Robert. It's Jarrod. Yeah, I think it's pretty minor in nature. When you build a brownfield project, there's work you need to do to integrate it with the existing FRACs. It's really just positioning some of the pumping and infrastructure on how we move products around the site to position us to move those products off-site. There's nothing significant around storage included in that because it's not required.
Yeah. It's a part of our...
It's environmental cost optimization, right?
You bet.
Yeah. It's just how do we most efficiently integrate FRAC III with the existing facilities that we have there?
Yeah. It's always intention to create the best service for our customers so that we have maximum flexibility between our FRACs.
Okay. Great. I'm just curious what you think is possible when you look at the portfolio of optimization options you have to expand that Montney processing capacity. Specifically, how do you see asset M&A fitting in terms of your menu of options to deal with those capacity constraints?
Yeah. Thanks for the question, Rob. I think that we have various options, whether they're brownfield or greenfield options to add additional capacity in addition to filling up our existing capacity. I want to make sure we're clear about that. We do see a significant amount of demand to fill up both Wapiti and Simonet. We are working on debottlenecking opportunities there to fully utilize that capacity. I know that Jamie talked about just potential opportunities in the area for capacity, but certainly, we have the financial wherewithal to also acquire assets that would be a fit into our integrated system where, again, we could provide our more competitive services if we add those assets to our business and also integrate it to our downstream value chain, including caps in our FRAC business. Those are the opportunities we're looking for.
We have the financial wherewithal to transact if we find something that fits, but we'll be incredibly disciplined if we do acquire something along that fairway. Anything you want to add, Jamie?
No. I think the only thing I'd add is that we have established a dedicated team, to Dean's point, to pursue those opportunities.
Okay. Thank you. I'll jump back in the queue.
Thanks, Rob.
Your next question comes from Patrick Kenney with National Bank Financial. Your line is now open.
Thank you. Good morning, everyone. Maybe just back on the FRAC III expansion from a cost. Just to confirm if any of the CAD 500 million budget is locked in with any fixed-price contracts or perhaps through procurement of steel or other materials. Maybe just a comment, too, on whether or not the recent delay by Dow might have a positive indirect impact on your access to labor in the region.
Yeah. Good morning, Patrick. I'll just maybe make a couple of comments, and I'll toss it over to Jarrod. I think very good observation about Dow. I mean, they have to run a business, and I totally understand their decision to defer their cracker expansion, but I do believe it'll be built at some point in the future. You're right. I do think that this is a good opportunity for us to have a build window because, as you know, our KFS site where FRAC III will be built is right across the road from Dow. We'd be competing for similar contractors. Obviously, we want the best contractors to be working on our project to give us the best shot at executing it well. With that, I'll turn it over to Jarrod.
Good morning, Pat. I think the first thing I'd note is that FRAC III is essentially a twin of the bottleneck FRAC II. We're not reinventing the wheel. FRAC II is a great project for us, and we're leveraging that into FRAC III. That in itself just gives us comfort from the nature of the work. In terms of what's locked in, it's still early days. Right now, we're in the midst of securing all the long lead equipment. A significant portion of that equipment will actually get ordered later this month or early June. That will help give us certainty on those costs. We're also getting closer on advancing construction contracts, which will give us some certainty there.
Early days to have a sense for how much is really locked in, but we're getting quite close to de-risking a significant portion of the project. There are some other strategies as well that we're employing around how we'll manage contractor activity and provide oversight that we think will help mitigate cost, schedule, quality risks, and all those types of things as well.
I assume a good time to be looking at the Fort Saskatchewan condensate system expansion as well. Maybe you can just confirm what the potential scope and timing might look like for that expansion.
Yeah. I can step in there, Pat. I mean, it's really about just debottlenecking a little bit of pipe, looking to take advantage of using drag-reducing agents that are very effective for that type of service in condensate.
Yeah. Bottom line, though, the demand for that service has been very strong. It has been great to see.
Okay. And then last one for me. Dean, you had a comment in the release just on the need to improve Canada's competitiveness through, I guess, policy reform. Can you just expand on what you think industry needs to see in order for the energy sector to reach its full potential?
Yeah. First of all, I'm optimistic that we're going to see some change, cautiously optimistic, maybe I should say, with the new leadership in place. In Canada, we have a problem with affordability, and we need to improve our GDP. We are a resource-based country. Where do we have the best opportunity to improve our GDP? It's our energy sector. I'm very hopeful that our Prime Minister understands a balance between the need to be environmentally responsible, which I think that we're tops on that front in our industry, but also balancing that with the need to be competitive if we want to grow and export our responsibly produced products around the world. What that means to me is we need to see improvements in policy and reevaluate the emissions cap, the clean energy policies.
We have to really have policies and permitting and regulations in place so that we can build more capacity to the West Coast, build more LNG so that we have more customers to sell our products to versus being so captive to the United States. We have to also break down interprovincial trade barriers, which is unbelievable that that's something that's self-created by ourselves. If you can address some of those issues, our industry will perform very well. We have a very low-cost production base in Alberta and British Columbia and a very big abundance of resource. We just have to have better policies to get it to market.
All right. Thanks for that. I'll turn it back.
Thanks, Patrick. Nice win too by the Oilers last night. I think you're an Oilers fan.
Your next question comes from Ben Pham with BMO Capital Markets. Your line is now open.
Oh, thanks. Good morning, everybody. Maybe I'll start off a couple of questions on the frac capacity and market. Can you talk about how the frac capacity market's going to shake out the next couple of years? You sanctioned the phase III, the debottleneck, your competition setting capacity. Do you anticipate by 2028 that the market's going to be more of an oversupplied situation? Do you think there's more of a runway even beyond that?
Good morning, Ben. That's a really great question. Certainly, when we look forward, when we look at the long-term market fundamentals, our basin's going to grow. Again, a lot of that's just tied to what we see in growth, tied to LNG exports, mainly from LNG Canada. We're hearing that there's more momentum around the sanction on phase II. Bottom line, there's going to be more natural gas growth in our basin, which is also going to drive growth in NGLs as well. Right now, we're fully maxed out on our capacity utilization, not just us, but our competitors as well in terms of frac utilization at Fort Saskatchewan. There's certainly a lot of demand for new capacity. For a short period of time, could it get overbuilt? It's quite possible.
The great thing for us is that there's been a lot of demand for our service. With that, we've contracted up about 85% of our whole FRAC complex. That would include FRAC I, FRAC II, and the debottleneck, and FRAC III. It is highly, highly contracted already. We have mitigated that risk, and we think that we're going to have more opportunities to fill the last 15%.
Okay. Got it. Thanks for that. Just staying on the FRAC side, can you remind me just how the contracts—I mean, you mentioned 85%—but was there some that you were recontracting April 1st? If so, just overall commentary on the trend.
I can turn this over to Jamie, but generally, I mean, we've been recontracting at KFS for the last couple of years. If you remember, last year, we announced, I think it was about 30,000-33,000 barrels a day of long-term FRAC capacity contracts that were signed that were over 10 years in duration. I can tell you over the past year, we've signed a lot more contracts of similar nature. We've done a really good job. Again, it's just something that we've been doing ongoing. The other thing I'd mention is that a lot of the FRAC contracts, in fact, almost all of them are integrated deals. They're tied to other services, whether it's upstream with our GMP business caps and also our downstream marketing business and logistics business. It's been very good for our company. You can see it in our results.
I think the thing that I would add to that, Ben, and it's a great question, is that, as Dean said, we've been recontracting for duration, but we've also been proactive in blending and extending contracts that were due to be recontracted so that we do stay out of that phenomena, as you pointed out, that we may find our province a little bit overbuilt in the 2028 timeframe. The key was to make sure that we had as little amount of contracts renewing in that time period as possible. We do that, as Dean said, really, we believe KFS is the best connected FRAC to market. Obviously, the Alta Gas deal that we announced last quarter is part of that, but we have the best connectivity to butane in the province, and we have now a comparable, if not preferred, access for propane as well.
Okay. It sounds like it's a legacy comment that 50% of your capacity is recontracted April 1. That's more of an old way of thinking about it.
Yeah. I would think about it from the perspective of that we've got some opportunities over the next short period of time to have that fully contracted. That's our goal, is to have that facility fully contracted probably within the next 12 months.
Ben, maybe your summary comments are tied to, I would say, if we went back five-plus years ago, there was a lot more contracts that renewed on an annual basis every April. What Jamie and his team have done is that they've really lengthened those contracts and put a lot of term to it. That is why the average duration of our contracts now are in the eight-year range. Again, a significant amount of them, 10-plus years.
Yeah. Okay. That's great. Thank you.
Thank you.
Your next question comes from Spiro Dunis with Citi. Your line is now open.
Thanks, Urquhart. Good morning, team. I wanted to start with CAP, if we could, more specifically around zones one through three, actually. Dean, I think you'd sort of talked about in the past growing into that 10-15% return range for that segment of the pipeline. Obviously, some growth announced today between Wapiti sort of filling up sooner than expected, KFS FRAC III now getting FID at least a little bit sooner than we had expected. I'm curious, maybe just a level set on the impact to that CAP zone one through three and how you're tracking to that 10-15% range now.
Yeah. Good morning. Thank you for the question on CAP Zone Three. Believe me, there is going to be a lot of growth, continued growth in Zones One to Three that we are very excited about. As you would have seen in our results, our Liquids Infrastructure performance was very strong this quarter. Some of that obviously is driven by growth that we are seeing on CAPs, Zones One to Three. What we have been saying, and we stand behind our guidance, is that our 7%-8% fee-for-service EBITDA growth target out to 2027, a lot of that is going to be from existing assets, including volume and margin growth on CAPs. We continue to see strong demand. We fully expect CAPs to continue to ramp up beyond 2027. It is going to contribute to our fee-for-service growth out to 2030 and beyond.
It is really helping us lock up integrated deals across our value chain, including FRAC III, which is what we announced today.
Got it. So it is great to hear. Second one, maybe for you, Eileen, just with respect to capital allocation here and really focusing on the share repurchase program. I think it is safe to say that equities have been a little bit more volatile than normal this year. I guess I am just curious, is this the type of market that your opportunistic program was built for? Have buybacks moved up in the capital stack lately? Are you still finding more growth opportunities or more attractive at this point?
Hi, Spiro. Thank you for the question. Yeah, I think it really remains the same, where we're really excited that we have the buyback option as a tool that we can continue to use opportunistically. It is something that we will continue to weigh as an option. As we've said before, the preference is to grow our business with infrastructure that will be around for decades. With all the commentary you heard from Dean earlier as well, where we see the basin growing, there are opportunities well beyond what we've talked about today of infract expansions and zone four. Again, our preference is to allocate capital to continue to grow the business. It remains unchanged. We will allocate capital to that highest value option, whether it's organic, inorganic growth, or buybacks.
All right. I'll leave it there. Thanks, everyone.
Thank you. Have a good day.
Ladies and gentlemen, as a reminder, should you have a question, please press star one. Your next question comes from Maurice Choy with RBC Capital Markets. Your line is now open.
Thank you. Good morning, everyone. Just wanted to come back to the marketing guidance. You mentioned that this guidance obviously reflects the CAD 50 million impact from the outage, but also highlighted the risk management program that mitigates the impact of commodity price volatility. I wonder if you could give us some examples of what you've done here. For example, were these positions that were in or out of the money, but you chose to close them a little bit early given the uncertain commodity price environment, or is it something else?
Yeah. Thank you for the question. First of all, before I turn it over to Jamie, I just say that we are not making speculative decisions where the market goes up or down, and we unwind everything and then reset our book hoping the market goes back up. We are really just trying to just make sure that we preserve margin. Anyway, with that, I will turn it over to Jamie, and he can elaborate further.
Yeah. I think you made the point I was about to make because, yeah, I would not want anybody to take away from my previous comments that we're in and out of the market based on volatility. That is not how we run our book at all, right? It's just that it's being patient and not panicking when prices go down certain levels, and ultimately understanding the market well enough to know when it's appropriate to layer in positions. We've done that very, very well over the years, and we continue to do that very, very well. It has set our ability to deliver on the results that we've and the guidance that we've given and created the confidence that we will deliver to that guidance.
Yeah. Maybe just to one of the points that Jamie made earlier, though, which is unrelated to hedging, is that when you have a lot of volatility in markets, sometimes markets dislocate. We have assets, and we have logistics and marketing expertise to take advantage of market dislocation. We can move products from one market to another market and make a margin off it. Sometimes those opportunities present themselves in environments like we see today. We will see how 2026 plays out. Again, we can potentially enhance our book with some of those types of opportunities.
Yeah. To layer onto that, and it is a great point that Dean makes, we have been able to take more advantage of those types of dislocations and/or opportunities as a result of the additional storage that we bought a couple of years ago at the KFS complex from our previous partner at that facility. You will have seen the benefit of that additional storage over the last couple of years in our results, and you will continue to see that benefit based on the fact that when there is volatility, that creates massive opportunities to take advantage of physical storage.
Maybe just double-clicking on that comment about dislocation and volatility. I think in your prepared remarks, you highlighted a number of favorable long-term trends about the basin's growth. I wonder if you could give us a little bit more of a shorter-term view. You have highlighted that you made some progress in filling the available capacity, but just your outlook about the basin over the coming months or quarters.
Sorry. I just want to make sure I understand your question, Maurice. Are you talking about just the general basin or?
General basin.
All and both, or are you talking specifically to our marketing business?
No. General basin, not the marketing specific, more about the base business.
Yeah. You know what? Our base business has been very stable, and we're seeing still continued demand. What I find with the consolidation that we've seen, and I also watch what happens on, sorry, south of the border. I get my directions mixed up here. With more and more consolidation, like I look down in the U.S., a lot of the majors now control a lot of the shale plays, and they've taken out a lot of the private guys and the smaller players that are drilling no matter what just to grow and increase their valuation for sale. I think that all those players, and that's happening obviously in Canada as well, and you saw Tourmaline and ARC and another unknown producer buy some assets off of Strathcona. I just believe that those larger players have a longer-term view. They're more strategic.
They have very strong balance sheets. They also understand that infrastructure cannot be built overnight. I mean, just think about our FRAC III. It will not be in service for three years. That is why they are making continued commitments across our value chain because they anticipate what is happening with more egress being built and volume growth in Western Canada. They realize that we need critical infrastructure to enable the growth, which is what Keyera has and what Keyera will continue to build in the future.
Understood. Thank you.
Thank you. Thanks for the questions.
There are no further questions at this time. I will now turn the call over to Dan for closing remarks.
Thanks all once again for joining us today. Feel free to reach out to our investor relations team if you have any additional questions, everyone. Enjoy the rest of the day. Thank you.
Thank you.
Ladies and gentlemen, this concludes your conference call for today. We thank you for participating and ask that you please disconnect your lines.