Great. Good afternoon, everyone. Thanks for joining us on day 1 of the 23rd annual Needham Healthcare Conference. My name is David Saxon. I'm an analyst on the MedTech research team here at Needham & Company. With me today, we have the Azenta team, including CEO Steve Schwartz and CFO Herman Cueto. This afternoon's session will be a fireside chat. If you have any questions, you can feel free to submit them electronically through the Needham Conference website, or you can feel free to email them to me at dsaxon@needhamco.com, and I'll do my best to work them in. Thanks, Steve and Herman, for joining. I wanted to start with some of the targets you put out at last month's Investor Day. I guess a couple of things. First, you decided to shorten the LRP 2 years, so going to fiscal 2026.
Top-line growth calls for 5%-8%, and that's kind of underpinned by low single-digit B Medical growth, mid-single-digit Multiomics growth, and high single-digit Sample Management Solutions growth. So first question is just on the 5%-8% target. Steve and Herman, I think both of you talked in January about returning to a mid-teens revenue growth. So I think some investors were maybe surprised by the 5%-8%, even though it is still well above the market growth. So I'd love to just reconcile the comments from January versus the actual targets and understand kind of whether the shortened LRP of fiscal 2026 and/or the state-of-the-market recovery had any impact on the 5%-8%.
Yeah. So, David, I think we've got a lot of questions about that. I think you said it exactly right. We forecast in the near-term low growth. So we forecasted 1-3. We're not calling what the market is because we really believe in the market. And for us to put out 5-8 against a 2% midpoint on a market estimate means that if the market gets to mid-single digits even, that will be a double-digit grower. And we still believe in that. But we wanted to do a couple of things in a shorter environment, in a 10-quarter period, where we're very concrete about the profitability targets for the company. If we're in this market environment that's low growth over this horizon, we've put out 5-8.
So as the market picks up, as the market recovers, you ought to take that growth margin and apply it to the market growth. So we feel strongly about that. And it was really to convey relative position, strength against market, as opposed to trying to call the market. So we haven't backed away from what we think the opportunity is. But if the market is a flat market, it'd be really hard to get to double digits. But a reasonable growth market ought to get us back there because we think there's plenty of market opportunity in each of the segments where we participate.
Okay. Got it. So if the market does recover quicker than what's assumed in the LRP, I guess the LRP doesn't assume any recovery. So if it does recover, there's potentially upside to the 5-8.
That's correct. We're just not in a position to call the market, so we didn't. We put the assumption out there. Absolutely, you said it exactly right.
Okay. Great. And then so B Medical growth, maybe we'll start with that business. So low single digits over fiscal 2026, which is below fiscal 2024 guidance of mid-single digit growth. This year, you obviously have the DRC contract, which is a large project. Maybe that spills into fiscal 2025. Is that the main factor driving the delta, or do you see anything else over the planning period that would potentially pressure B Medical growth?
Herman, go ahead.
Yeah. I was going to start, and then, Steve, feel free to jump in. So, David, a couple of things. What I would say is, first, it's a lumpy business, as you know. So when we think about the way we're guiding, we're, of course, considering that. It's a pipeline business, and we always talk about the timing of how that pipeline converts. And that's really the big story with B Medical is the timing of that. But even beyond that, we, of course, look out, and we look at the funding environment and where we see that playing out over the next couple of years. And this guide that we talked about lines up with all those different factors and considerations. On the DRC in particular, given where we are at this point in the quarter, we won't give any further details on that specifically right now.
But funding environment, lumpy business, those are certainly a couple of the key considerations that we talked about. I think if I were to pivot for a minute, when we talked about the opportunity for sample acquisition and the focus of moving the B Medical business towards that now, none of that is baked into this plan that we put forward. But that's really the exciting opportunity that we see in B Medical. So as we continue to explore that in a profitable way, we've talked a lot about how we're transforming that business, making some structural changes inside of that business to really drive profitability. It gives us the opportunity to explore that very exciting opportunity in a profitable way. So that's how we're thinking about B Medical right now. And, Steve, I don't know if you would add any additional color to that.
No. I think, David, just to address your point about the low single-digit growth, for us, very simply, as Herman said, this is lumpy. It's dependable, but lumpy. So we know that we've won the DRC business. When that exactly hits, a single quarter at the end of a year can drive enormous growth. And so we think it's cautious that in the aggregate, we'd say the low single-digit growth, but the opportunities exist for a lot more potential. We're schooled in not getting in front of this business. So even the way we guide it, we think, is the right way to present it to shareholders. We do anticipate, as Herman said, as we can layer more business on top of this platform, that it'll become a little bit steadier and something more it'll level out some of the perturbations.
But for now, we think it's a reasonable guide that we feel very comfortable about at low single digits for B Medical. And as we talked about, the transformation of that business allows us to have the profitable vaccine cold chain as the footprint, sourcing samples on top of that. And some of the less profitable businesses will exit and just really focus on what's the opportunity for the company.
Okay. Yeah. That's great. And then we'll circle back to touch on the sample acquisition opportunity and the non-VCC exits. But for the time being, I want to stay on the LRP. So, Herman, you talked about B Medical being kind of a pipeline business. So, I mean, can you characterize the pipeline at this point as it relates to the LRP? I mean, do you have visibility out that far?
I don't want to get into too much detail on that right now, David. Just, again, given where we are in the quarter, we have said in the past relative to fiscal year 2024 that the pipeline is robust and it's strong. It continues to be that way. That's how we're looking at it right now. But the timing of how the pipeline converts to revenue continues to be the thing that we monitor. And we want to make sure we're cautious about how we talk about it.
Okay. Yeah.
And, David, I will say I have a longer history. The pipeline's as healthy as we know it, but it's also as dependable as we know it to be and not to be. But the pipeline is strong. The position is only better with B Medical. The timing of funding is the wildcard still.
Okay. Got it. All right. Switching over to Multiomics growth. So that'll be mid-single digits. So please expect it over the fiscal 2026 planning period. So there's a number of modalities in there. So the main ones are Sanger NGS and Synthesis. And then you started talking about newer ones like proteomics and single-cell, which you kind of said could be the size of the current Multiomics over time. So looking at the mid-single digit growth, I mean, what's driving that? What are the main drivers behind that growth?
So mid-single digit, even a low single digit today is significant outperformance from a market that's dropped. And so we put mid-single digit in, David, not because we don't believe in the strength of the business. We really do. And we know that the proteomics and the single-cell are at a very high growth clip. The NGS is the uncertainty right now. It's the next-gen sequencing from the standpoint of what as the costs come down, the price expectations come down, and we're doing a good job staying in front of it. But we're a few quarters into what's the third or fourth transition in cost. And so we think that's a reasonable outlook. So strong growth from the proteomics and single cell. Sanger remains soft as the biotech fundings have been lower. And the NGS is really healthy.
We're staying in front from a revenue growth standpoint, but we're generating a lot more data than we ever had before. We're working really hard to sustain that, but we're keeping in front from a margin standpoint. We have a few more quarters as the low- cost technologies grows. We're staying in front, but we don't know the nature of what that competition will be like. It will sort out. On this long-range plan horizon, it'll be stabilized by the time we get to end of 2026.
Okay. Got it. And then the newer modalities so how should we think about those from a margin perspective? Are they? I'd imagine they're immaterial at this point, but as they grow in terms of mix, how do they impact Multiomics margins?
Yeah. I mean, we typically wouldn't guide on margins at that level. But, David, the way you might want to think about it is it would certainly be incremental volume in our labs. So the volume will help overall margins. And as we talked about with Project Ascend, we're working to get our network, our site architecture to a more scalable place, I would call it. And as we do that, any type of volume will certainly help gross margin. That's how I would think about it.
Yeah. David, to date, it's been consistent with the performance of the rest of the Multiomics business, so.
Okay. All right. And then so for sample management, so that'll be the fastest grower over the LRP. So within that, you have core storage, large auto stores, and C&I. So of those three major product categories, what are the main drivers of the high single-digit growth?
Yeah. You certainly have very strong growth in large automated stores. So as the market moves towards automation, that will certainly continue to grow nicely for us. And as companies look to take their sample assets and outsource them to a company like Azenta, that certainly continues to drive outsized growth for us. And then the C&I business, I think we talked about that investor day as being more of a moderate grower over this time period. And I think the combination of those three things put you in that high single-digit range.
David, I'll add, just on the sheer sample counts, the volume of samples that companies need to manage, the complexity of those collections and the geographic distribution is really significant, and the fidelity of the sample. So the knowledge that it was cold and at a safe temperature for its entire life and in transport and in transit and in handling has become just ever more critical. So these things conspire to drive an opportunity for automation in every aspect, in other words, on-site or at a repository. So we continue to see these things driving into the care of automated company or automated capability. And we don't see that abating at all just because the volume, as I mentioned, the volume and complexity continue to increase exponentially.
Okay. Got it. And then historically, you've talked about the cell and gene therapy customer group as being a high-growth customer segment for Azenta. I don't think I heard any questions about it at the investor day. So would love to hear kind of how you're thinking about that segment over the planning period.
So it's.
Oh.
Go ahead, Steve. No, I didn't mean to speak over you. Go ahead.
It's really simple. So, David, it's been softer for us in 2023. There's absolutely no question about it. The volumes that we had in 2022 were toward very good growth. And so we were growing in the double digits, 20%-ish range. It's still a small part of our business, meaning it's in the high single digits, but not yet 10% of the opportunity. But we have a portfolio that's laid out in advance of that. So the capabilities we have from storage and transport and automated cryogenic systems were teed up exceptionally well for this business. As it recovers, we'll gain that. The Multiomics capabilities exist, are positioned extremely well. So we believe that as volume picks up, certainly as manufacturing picks up, that we're positioned really well.
Without a doubt, 2023 was a softer year compared to 2022 and off of the trajectory that we'd seen for the four years before that.
Okay. All right.
Yeah. And, David, what I was going to say here is we've talked about the funding environment here, and we didn't really call the market in our guide. So you would look at this as continuing to be, as Steve said, a small portion of the business until we start to see some recovery there.
Yeah. Okay. All right. Maybe we'll look at the margin targets. So, Herman, 15%-17%, Adjusted EBITDA. That comes out to around like 300-400 basis points of annual improvement. I think 30% of that is OPEX leverage versus the rest from some of these cost reduction initiatives you've talked about. So to the extent the market growth normalizes, I guess, how much would that or potentially drive, aside from a margin perspective, as you see greater OPEX leverage?
Yeah. I think, David, you will see more overall leverage on the business as we go through Ascend and we really look at solidifying the foundation for scaling growth. As we do start to grow, if we were to grow faster than what we've put in the plan, I do think you'll see more leverage on sort of the fixed overhead. So you could see outsized leverage just from the business. But right now, I think what we've called for in this LRP period is what we're seeing right now. So that's how I would think about it. But you're not wrong. If the market recovers and we do see accelerated growth, yeah, I would expect that we see more leverage on the fixed overhead.
Okay. Got it. All right. And then so regarding the kind of cost reduction initiatives, so you've called out $30 million-$40 million of opportunity. It doesn't sound like it's it for longer term, at least. So can you give us a sense of what inning will be in exiting fiscal 2026 in terms of how much more opportunity you have on that front?
Yeah. I mean, if I were to step back, David, I would look at Ascend as it's almost like a mindset that we're moving into. We always want to be thinking about how we could become more efficient and more effective and more profitable. So this first wave of Ascend is how I describe this when we talk about the things that we're looking at. It's really the first wave. And it'll be a mindset of continuous improvement. And I think when we get to the next investor day and we're talking about a time period past 2026, we'll continue to be talking about how we could make the business more efficient. And I always point back to automation and what that could mean for gross margin.
When Steve stood up at investor day and talked about the BioArc Ultra, that creates a tremendous opportunity inside of gross margin when you are able to automate and take labor costs out. I think the next wave of Ascend will really focus on those sorts of things. I would look at this as an ongoing program where we're driving operational efficiency forever into the foreseeable future.
Okay. Great. All right. Just a couple more longer-term questions, and then we'll focus on the near term. And maybe I'll start with Steve. So at the investor day, you talked about briefly getting to $2 billion in sales. I understand we got to get through fiscal 2026 first. But as you think about potentially getting to $2 billion, what are the kind of major drivers behind that, and how much of that incremental growth, dollar growth, would the sample acquisition opportunity at B Medical does that represent a significant portion of that?
Yeah. So it represents a portion, but a significant portion. David, we value the sample estimates that we have somewhere on the sourcing side of the order of $100 per sample. There are some living examples of that as a reasonable lower-end price. And so for us to go get 200 million samples can easily make $200 million of a $2 billion. So just to put it in that kind of perspective, there's upside and downside to that. But it's such an opportunity with the capability that we have that uniquely we can deliver because of the repository capability, the measurement capability that we have, that it's worth going after. And so we put it out there as that type of number. But it's not what swings $2 billion.
The fact that we face $1 billion of manual freezer market as an opportunity every year that we can begin to automate, the fact that the number of samples in repositories, we see 24 billion samples stored on Earth today, and we have a $100 million roughly business on 50 million samples. We see that as a tremendous growth opportunity that's critical but not core for companies, but it's core for us. So we believe that instead of 50 million samples, we should start approaching 500 million samples and really make that an opportunity where we can not only store for customers but also enable them to manage their samples with incredible efficiency and better economics compared to where they are. So we believe those to be real.
You already mentioned the fact on the Multiomics side that we have an opportunity to grow once more as we get into proteomics in a bigger way. We're already a significant footprint to be able to serve proteomics types of capabilities and single-cell, same thing.
Okay. All right. And then maybe for Herman, you talked about getting to 20%+ Adjusted EBITDA margin. Does that coincide with the $2 billion, or are they kind of separate?
I think, listen, I think we're focused on fiscal year 2026. I think $2 billion, leave that off to the side for a minute. What I would say is we'll exit this period between 15%-17%, as we had talked about investor day. It's 300-400 basis points of margin expansion. When we roll into the next investor day, what I would be looking to do is stay on that type of trajectory. I think there is opportunity within automation that would help us get there. We couldn't commit to it right now. Again, I would like to see us staying on that type of trajectory until we get to 20%. Then I think once we get to that 20% EBITDA margin, it'll be important to look at where the markets are and the businesses are.
And if there's outsized growth for us to capture, we certainly want to be investing behind that. And I think at that point in time, we'll continue to assess where we're at and see how we drive further profitability.
Okay. Very good. All right. So let's turn to focus more on the near term. It doesn't sound like you want to give any more color on the DRC contract. But I guess maybe just confirm that if I remember correctly, the fiscal second quarter guide doesn't include any DRC revenue. Is that right?
I don't recall off the top of my head how we got into that.
It's correct. Yeah. We didn't include any in the number we put out. So it's correct. Okay. All right. Got it. So we'll see later in the year. Okay. And then can you remind us when you're expecting to exit the non-VCEC product lines? Will that have any impact in fiscal 2024?
It doesn't impact what we put out there as a guide, David. There are operational things that we need to work through. But we gave a target of fiscal year 2025 inside of fiscal year 2025 we talked about at investor day. So we have to work through these operational items. But right now, that's where we're targeting.
Okay. Got it. All right. And then so circling back to the sample acquisition opportunity, I mean, you've talked about it a lot over the last quarters and potentially a year or so. Is there any way to size that opportunity?
Again, David, we really want to bring something home so we can give people a definition of what it is. And we're just working it. If it was just two-party transaction, it's a little simpler. But we're between the sources and the customers. And so we're just not at that position yet. But suffice it to say, there's strong interest. Everybody's aligned in the right way. It's just getting it defined and transacted that'll give us a base case that we'll be able to extrapolate for everyone. What are the implications of this ability to source and measure and then transact the consented data to various customers, so.
Yeah. To confirm, I mean, it sounds like you're actively engaged, but there's nothing included or at least material in the.
That's correct. So we are active. We're absolutely active. But just because of the timing that's uncertain, we'll announce as soon as we can. But we remain really positive about the opportunity.
Okay. All right. Maybe we'll move to sample management solutions. So that's the legacy products business as well as the former SRS, Sample Repository Solutions business. So within the products, maybe we'll start there. So you have the consumables and instruments. So that's been challenged. So maybe just remind us what you're seeing there. I think you had talked about some stabilization, at least in the U.S. So just giving us an update on kind of what the latest is for the C&I recovery.
Yes. So, David, we'll give more of an update on this when we do our call in May. But as we talked about on the last call, we did see the U.S. in a more stable position. When we talk to the team and they are closest to it talking to distributors, we do think that the outsized inventory positions in the U.S. have started to wane, and they've kind of worked through that. And Europe was right behind them. So that stabilization, I believe, is in front of us. And again, like I said, we'll give more of an update when we do our call in May. But that's what I just described as consistent with what we talked about at the last call.
Okay. Great. And then in system stores, I think a lot of that growth has been driven by large automated stores. So maybe talk about what you're seeing in terms of customer spending trends and characterize the backlog for us.
Yeah. So the customer business has been really steady. So, David, we hit periods where there's a hole, and we hit periods where customers continue to spend. And we have a pretty strong backlog there in the business. We did talk about having our expectations for fiscal 2024 covered, and we do. And so the business continues to come. The customer readiness, our ability to install, is what ultimately governs revenue. But we can say the factory's getting busy and getting pretty full. And so if we go to a new threshold, those are your investments that Herman and I will spend time on. How do we make sure that we're able to keep up with that? But the large automated stores, there seems to be a general trend that customers know that's how they're going to go manage samples.
And the more customers that do it successfully, the more customers come forward and request the same kind of thing. So we do feel we do feel like we've come to a tipping point in that business that that backlog is a lot more dependable. And the cycles, instead of being sometimes two and three years, these are 12-18 months just because people are more sure that they're going to go make those investments.
Okay. Got it. And then something you just said, and I think it was a reiteration of the investor day, but you have fiscal 2024 covered by the backlog. You kind of alluded to it, but it sounds like if there is upside or further demand to the backlog, it might not be upside to fiscal 2024 just given capacity. That might just de-risk fiscal 2025. Is that a good way to think about it, or?
Yeah. We can make some adjustments, but we can't, David. It's nice to have the backlog, but we also can't force things faster because sometimes they have to get a facility ready. So we've got a little room there. But if we accelerate so that in a quarter we're going to do $2 million more revenue, it's not a guarantee that we could do $5 million more, for example, because the customer just might not be ready. And so we feel comfortable with the backlog. We're working all customer issues because we are going to need factory capacity. And so we do need to see who can allow us to accelerate so that we could do that, to get tools manufactured, get them off the floor so we can start the next ones. And so there's nothing different from what a steady-state plan is right now.
If and as we needed to add more capacity, we're working those issues right now to make sure that 2025 will be able to accommodate what we anticipate could be a little bit heavier volume than we've had in the past.
Okay. All right. And then you've also started talking about this opportunity to convert customers over from manual freezers to automated freezers. So how long is that conversion? How long would that conversion take? I mean, is this like 10+ years, or can it be shorter than that? And then at what point does automated freezers just become the default choice for customers?
If we make an estimate, there are always going to be manual freezers. Those are incremental opportunities. But when we talk about 80,000-100,000 manual freezers every year, can we pick off 10,000 of those in the next couple of years and another 10,000 of those over a 5-year period? Absolutely, we can. And so that has a chance to appreciably take a dent out of this billion-dollar annual freezer market. So we think that we think that's begun, but we just need to do it steadily. David, it's tough to pick because it's a big different it's a big decision for a customer. I'm going to buy another $10,000 or $15,000 freezer. I'm going to go invest in a $2 million store. And those are things customers get used to. But it's a transition that's happening, we believe.
It's helped by the fact that freezers ultimately wear out. Somebody's going to make that decision and say, "You know what? Let's go ahead and make that investment in an automated store so that over a 10-year period, we'll have an automated store in here as opposed to having replaced every freezer on the floor.
Okay. All right. Maybe we'll touch on the SRS part of the business. So you have a new biorepository facility in the Boston area. You've talked about the rationale behind that, choosing the Boston area. There's a lot of life science companies here. So maybe talk about the traction you're seeing within that cohort of customers. How many are current customers versus potentially new to Azenta?
The repository is now qualified. Freezers are calibrated and ready. Now it's set up for audit. So as customers come through an audit, then subsequent business will follow on. So we don't have a customer capture account right now because they can't make that move till they come to do the audit. But the facility's ready, and the audits have been done. But, David, we'll update on our quarterly calls what the progress is as we begin to fill the repository. There is what we believe is a huge opportunity just from a cycle time standpoint for us to be able to manage samples in the Boston area. And I think that's what intrigues the customers is, "How do I keep my samples nearby because I still have access to them?" And that's the thing that we think is going to drive the business.
We've got the proof points out, but customers lined up now to begin their audits of the facility.
Okay. All right. And then on Multiomics, you're expecting a couple of points of pricing pressure in fiscal 2024. Is that balanced across modality, or is there anyone that's seeing kind of outsized pressure relative to others?
I think a lot of it is indexed towards next-gen sequencing, David. That's where we're seeing most of the pricing pressure as the technology shifts to more of the NovaSeq technology. We are seeing pressure there, and we just need to cycle through it. But that's largely where we are seeing is in NGS.
David, I want to pile on here, but we always talk about pricing pressure because that's what it feels like. This is anticipated and forecasted, and it's what drives the volume in the business. So yeah, the price comes down, the costs come down. And how do we manage this from a volume and capture standpoint? The one thing that we do believe that is happening is that there are customers who don't have enough volume now to capture the benefits, for example, of a technology like the NovaSeq X Plus. And so they'll be able to get a good part of that by coming to a company like Azenta and GENEWIZ because we'll be able to give them some of those economics. And so we think that's a helpful driver, but we're in the earliest days here.
But somebody who could fill a 6,000 tool might not be able to fill an X Plus. And that's where we think there are really good opportunities for us. And at the margin, those are good chances. But we're sensitive about the pricing. But customers' expectations are also that the costs are part of that, and they understand that we're a company that's got to be profitable to be sustainable. And so again, we're cautious about the term pressure. It certainly is, and it certainly looks like that. But we welcome it, and like we have with every generation of tool that we've had in the past 10 years.
Yeah. But despite kind of pricing and costs, I mean, you've been able to hold gross margin, I think, in Multiomics.
Yes.
Okay. Got it. All right. And then maybe we'll focus more on kind of the P&L. So, Herman, I guess, talk about the gross margin drivers in fiscal 2024 and then also what's assumed in the 15%-17% 2026 targets.
Yeah. I mean, we don't guide on gross margin. But what I would say, David, is when you think about the programs of Ascend that we talked about at investor day, site consolidation, when we talk about taking four factories and consolidating them into one, that will certainly have a gross margin benefit. I think on top of that, you're seeing volume in places like Multiomics, as we just talked about, as we navigate some of the pricing dynamics in the NGS business. The volume is certainly helping us sustain gross margin. I would certainly expect that we continue to expand gross margin over the LRP period. But in terms of the guiding, it's very, very important to us, and we continue to drive that. But it's not something that we give a ton of color on right now.
Okay. Got it. And then just turning to M&A, I mean, you have a really healthy, strong balance sheet. You are completing the share repurchase program by the end of this calendar year, I believe.
That's right.
But would love to hear kind of your appetite for M&A in the near term, I guess, over the fiscal 2026 planning period and how our valuations looking in kind of the tuck-in segment of the market.
Yeah. So, David, we love the portfolio. We think it's pretty solid from the standpoint of completeness. So we're eager to continue to grow out. The programs you hear us talk about, like the BioArc, like the expansion on the Multiomics facilities, these are organic investments that are first and foremost, and they're exciting for us. So we really like those opportunities. There are some tuck-in opportunities that exist, but those are always made because we think we've got the best in class of all the companies in the portfolio that we put together. But there are still some chances for us. The valuations are reasonable, I would say. And so that's not the expectation. There's no wild expectations here. But right now, anything that we do, you'd see us that is aligned pretty well to the portfolio that we have.
It'd be to add a little bit of scale. It'd be to add a capability that we think we can acquire faster. But we love the balance sheet position, and it's really adequate for anything that we want to do over the next couple of years, we believe.
Okay. And then, Herman, I think in your section at the investor day, you were talking about some ERP work, and you want to get to the point where it's just a plug-and-play. So I guess how much work does that require, and is that something that can be finished or complete by the end of the planning period?
Yeah. I think by the time we get to the end of the LRP, we'll be in a really good spot. There could be some stuff around the edges that we could do, but we would feel really good about our plan. I think we talked about getting to and it's less ERP. They're more IT-type systems because when we talk about the acquisitions that we've done over the last 10 years, some of them were smaller companies. So it's just taking a very small IT system and plugging it into our system that we currently run and operate. So it's really just tuck-in type work. It's not wholesale, Azenta-wide ERP upgrade, disruptive like that. It's not that at all. It's more taking these smaller subscale companies and putting them onto our platform. So it's work.
Some of them are certainly easier than others, but it's something that we have plans to do. We have the teams rallied around. We'll certainly be doing a lot of testing and making sure it's done the right way. But I don't see any issues in executing on the plan that we've laid out.
Okay. Great. All right. Well, we're at time. So, Stephen, Herman, thank you so much for joining us this afternoon, and thank you for everyone who tuned in. We'll leave it there and have a great day.
David, thank you for this. We appreciate it.
Thanks, David. Thanks, everyone.
Thanks, everybody.