Good day, ladies and gentlemen, and welcome to the Brookfield Infrastructure Third Quarter Conference Call. At this time, all participants are in a listen only mode. Later, we will conduct a question and answer session and instructions will follow at that time. As a reminder, this call may be recorded. I would now like to introduce your host for today's conference, Melissa Lowe.
You may begin.
Thank you, operator, and good morning. Thank you all for joining us for Brookfield Infrastructure Partners' 3rd quarter earnings conference call for 2019. On the call today is Bahir Manios, our Chief Financial Officer Sam Palas, Chief Executive Officer and Ben Vaughn, our Chief Operating Officer. Following their remarks, we look forward to taking your questions and comments. At this time, I'd like to remind you that in responding to questions and in talking about our growth initiatives and our financial reporting and operating performance, we may make forward looking statements.
These statements are subject to known and unknown risks and future results may differ materially. For further information on known risk factors, I would encourage you to review our Annual Report on Form 20 F, which is available on our website. With that, I'd like to turn the call over to Bahir.
Great. Thank you, Melissa, and good morning, everyone. I'm pleased this morning to discuss our results of operations for the Q3 of 2019 and also provide a quick update on our funding plan, including the latest phase of our capital recycling program and liquidity position. So our operations performed well in the 3rd quarter, generating funds from operations or FFO of $338,000,000 On a per unit basis, FFO was $0.82 representing a 15% increase over the Q3 of 2018. Results this quarter continued to benefit from strong organic growth of 9%, with solid performance in each one of our operating segments.
And that was driven by inflation indexation, additional volumes going through our networks and almost $700,000,000 of new capital projects that were commissioned into earnings over the past 12 months. In addition to the good underlying performance in each one of our segments, we also benefited from solid contribution from the $1.7 of capital that we put to work over the past 12 months. As these new investments were primarily funded with proceeds from the recycling of mature, de risked assets, our FFO included an incremental contribution of $22,000,000 in the quarter. Our results for the quarter also benefited by $9,000,000 from improved hedge rates on our FFO compared to the prior year, which more the impact of a weaker Brazilian real. Now I'll take you through results for each one of our segments.
Firstly, FFO from our Utilities segment totaled $145,000,000 for the quarter compared to $130,000,000 in the prior year. This segment delivered 9% organic growth arising from $300,000,000 of projects that were commissioned into rate base in the last year, inflation indexation across our portfolio and continued strength in connection activity at our U. K. Regulated distribution business. In September, our U.
K. Regulated distribution business signed a 15 year strategic partnership agreement with Sky Fibre Broadband. The partnership will bring Sky's 3 leading products of TV, voice and broadband onto our fiber network. As part of the deal, Sky will become the anchor tenant for broadband services in new and existing residential developments. The establishment of the strategic relationship with a Tier 1 Internet service provider is an important milestone for our business as we look to build on the growth recently achieved with our fiber offerings.
The inclusion of this broadband leader should make our traditional multi utility bundle more attractive to homebuilders and further differentiate our product offering relative to our competitors. This quarter, we also advanced the build out of our Brazilian electricity transmission business, which consists of projects that total 5,200 kilometers of transmission lines. During the period, we exercised our option to acquire 50% interest in a second segment of operating lines from our partner, bringing our ownership in this project to 100%. We currently own 2 operating transmission lines outright, totaling 800 kilometers and expect FFO from this business to grow significantly over the next 3 years as we commission the remaining lines and acquire our partners' outstanding interest. Our Transport segment contributed FFO of $128,000,000 compared to $119,000,000 during the same period of 2018.
Results in the current quarter benefited from volume growth across our ports and toll roads as well as higher tariffs and rates that contractually escalate with local inflation. These positive contributions were partially offset by the impact of the sales of a 33% interest in our Chilean toll road and our European operations both completed this year earlier this year. Our various operations within this segment are performing very well. Of note, our Brazilian transport businesses continued to show improvements in their results despite the impact of a weaker Brazilian real relative to the U. S.
Dollar. 3rd quarter results highlight the resiliency of our cash flows that are earned through regulated tariffs at our toll roads and contracted volumes at our integrated logistics business. At our toll road, traffic levels continued to recover from the 2016 recession levels. Both light and heavy vehicle volumes at our existing roads are above prior year levels and have increased by over 8% since 2016 at our existing roads. At our Rail business, FFO has increased approximately 25% relative to 2017, which is primarily attributable to the BRL 2,000,000,000 Port of Santos expansion that was completed 2 years ago.
The expansion meaningfully increased the capacity of our network and removed bottlenecks that limited the volumes our networks could accommodate. Looking ahead, we expect consumer confidence in the country to strengthen as inflation and interest rates in the country are approaching all time lows, and that should further benefit the results of our businesses in the country. FFO from our Energy segment totaled $100,000,000 reflecting a 70% increase relative to the Q3 of 2018. The step change increase was primarily driven by contributions from the acquisition of a North American Residential Distributed Energy business and a Canadian midstream operation and a fully contracted natural gas pipeline in India. Together, these new investments generated approximately $40,000,000 of FFO in the current period.
Results also benefited from strength at our U. S. Gas transmission business as a result of new customer contracts and the commissioning of capital expansion projects. Over the last few months, our distributed energy operations in North America have successfully progressed several exciting organic growth initiatives. Of note, we commenced an eastward expansion of our Toronto District Energy System that will provide sustainable heating and cooling to a growing expansion of the city.
This expansion could potentially add up to 20 connections to our business and could meaningfully aid our results going forward in the business. FFO from our Data Infrastructure segment was $36,000,000 for the period, almost double the amount earned in the prior year and primarily reflects the contribution from recent investments that substantially expanded our global presence. These investments include a global data center business and a data distribution business in New Zealand. Additionally, our French Telecommunication business reported organic growth of 5 percent, primarily the result of its build to suit tower expansion program. Integration efforts at our data distribution business in New Zealand are progressing well.
We're looking to execute on a multifaceted margin improvement plan that should drive significant growth in the cash flows in this business in the next couple of years. We also announced the rollout of the first commercial 5 gs service offering in the country, which should position us well to capitalize on the growing data needs in the region. So that completes my recap of our results for the quarter. Next up, I wanted to briefly touch on the state of our balance sheet and funding plans. Firstly, as we highlighted at our Investor Day in September, the monetary stimulus implemented post the financial crisis and subsequent evolution of the credit capital markets has enhanced the ability or the availability of capital across the credit spectrum.
Despite the availability of debt financing, we remain committed to protecting our balance sheet through a conservative and disciplined approach to borrowing. We use leverage as an optimization tool and in certain circumstances, this can mean accessing the leveraged finance markets. However, we do so prudently and without compromising the core objectives of preserving ample liquidity and ensuring resilience through economic cycles to minimize exposure to market and refinancing risk. In addition, we're always looking for ways to opportunistically benefit from this attractive interest rate environment. The completion of our CAD 500,000,000 corporate bond issuance in October is an example of this approach at work.
We elected to access the bond market to lock in an attractive fixed rate of 3.4% for a 10 year term, and we'll use the proceeds partially to redeem a $375,000,000 series of notes in late 2020. This issuance extends our corporate maturity profile to 6 years and further derisks our near term funding and capital plans. We also proactively secured a long term financing at our UK regulated distribution business amidst the favorable credit market backdrop. The financing has an average all in cost of 2.4% and has an average term of approximately 15 years. We ended the quarter with over $3,000,000,000 of total liquidity, including approximately $2,200,000,000 at the corporate level.
Our liquidity position will be supplemented by almost $600,000,000 in the coming months upon closing of 3 recently signed capital recycling initiatives, which Sam will discuss further in his remarks. Overall, this latest phase of our capital recycling has been very successful. Thus far in 2019, we've secured or completed 5 initiatives. Once we closed the 3 advanced sales that we're working on, we would have generated almost $1,100,000,000 of liquidity from our capital recycling initiatives in 2019. Furthermore, we're targeting additional proceeds of over $1,000,000,000 from this program next year, with some of these processes already launched.
On a combined basis, this exceeds the $1,500,000,000 to $2,000,000,000 target that we announced earlier this year. And so with that, I thank you for your time this morning, and I'll turn the call over to Sam.
Okay. Thank you, Bahir, and good morning, everyone. For my remarks today, I'll provide an update on some recent investment in asset sale initiatives, and I'll give an outlook for the business. Before I do that though, I want to briefly recap our recent announcement to establish Brookfield Infrastructure Corporation or what I'll refer to going forward as BIPC. Despite having a unique asset base and an attractive financial profile, we have come across many investors that are unable to own units in our business as a result of our limited partnership structure.
To address this issue, we decided that we would launch BIPC, which will provide investors with an alternative way to gain exposure to our global infrastructure business. BPSI will be established as a publicly listed Canadian corporation upon receipt of various regulatory approvals. We tend to list BPSC shares on the New York and Toronto Stock Exchanges. Now for those of you who are unable to listen to our Investor Day presentation, this is how BIPC works. The corporation will be created by way of a special distribution that will be analogous to a unit split.
We currently anticipate that BIP unitholders will receive one share of BIPC for every 9 units of BIP held on the record date in respect to its special distribution. On a go forward basis, investors will have the option of buying a BIP LP unit or a BIPC share. BIPC shares will be structured with the intention of being economically equivalent to BIP units with identical distributions and the ability to exchange BIPC shares into BIP units at any time. We expect the initial market capitalization of BIPC to approximately $2,000,000,000 and the transaction is being structured on a tax free basis to both Canadian and U. S.
Unitholders. The aggregate market capitalization of Brookfield Infrastructure should be unchanged by the introduction of BIPC. Now we see many benefits in establishing BIPC. 1st, it will expand our investor base. For those investors that cannot invest in BIP units today, BIPC will provide an opportunity to own an economically equivalent security with a traditional corporate structure.
2nd, it will broaden our eligibility for index inclusion. As passive index investing grows in popularity, it is increasingly important that vertical infrastructure be included in the major global indices. While BIP is currently included in the S and PTSX Composite Index and the S and PTSX 60 Index, BIPC shares should be eligible for inclusion in several other global indices, which we expect will further expand our investor base. And then finally, there will be tax advantages for some investors. For U.
S. Investors, BIPC dividends are expected to be qualified, and the federal tax rate on dividends will drop meaningfully to 24% as compared to 41% on BIPLP's distributions. For Canadian investors, BIPC dividends will be considered fully eligible dividends. All BIPC shareholders will have simpler tax reporting and will receive common dividend reporting slips. Now subject to receipt of regulatory approvals, we plan to complete the transaction in the first half of 2020.
I'm glad to say that the initial reaction from our unitholders to launch of BIPC has been very favorable. And as a result, we are excited to bring this initiative to fruition. Now let me move on. I'll touch on our current strategic initiatives and some recent asset sales. And beginning with our new investments, we are progressing several attractive initiatives that have either been secured or in advanced stages.
We recently achieved financial close on our North American Gas Pipeline business, investing approximately $140,000,000 of equity per BIP. In the coming months, we expect to invest a further $1,100,000,000 across various businesses, and the 2 biggest initiatives underway are Genesee in Wyoming and a tower portfolio owned by Reliance Jio. In that regard, in July, we announced the $8,400,000,000 take private acquisition of Janssen and Wyoming, which we will be acquiring alongside institutional investors with Biff's share of the investment being approximately $500,000,000 We are pleased to report that we recently received approvals from both G and W's shareholders and the Surface Transportation Board, and the transaction therefore is on track to close in the Q4 following receipt of the remaining customary regulatory approvals. In addition, we are also finalizing an agreement with Reliance Jio to acquire a large scale portfolio of 130,000 telecom towers in India. This transaction is being negotiated on a bilateral basis and leverages our existing relationship with Reliance Industries, a counterparty to the Indian pipeline business we acquired earlier this year.
We've substantially completed our due diligence and are currently finalizing transaction documentation. We expect to sign definitive documentation in the coming weeks and anticipate BIP investing up to $400,000,000 upon closing of the transaction in the months that follow. As Bahir just mentioned, the latest stage of our capital recycling program has been very successful. We are focused on closing 3 recently signed asset sales in the next few months. The first one I'll touch on is an agreement that we have to sell our Colombian regulated distribution operation, which would generate approximately $100,000,000 of after tax proceeds to BIP.
In 7 years of ownership, we grew EBITDA at that business at an annual rate of approximately 10%. This was achieved by commissioning several accretive capital projects and improving margins by reducing energy line losses. Upon closing, which is expected in the 4th quarter, we anticipate earning an after tax IRR of approximately 18% in U. S. Dollar terms and generating a multiple of capital of almost 3 times our initial investment.
The second one I'll touch on is our divestment of our District Energy and Distribution business in Australia for approximately US280 $1,000,000 One of the core components of this business is a gas distribution network that serves the state of Tasmania, and we acquired this business as part of the Babcock and Brown recapitalization in 2,009. Over the last decade, we made a substantial investment in the business to expand its newly built network and increase customer connections. Our exit price translate to about an 18 times EV to EBITDA multiple, which is a strong valuation that reflects the stability and positive growth outlook for the business. The sale is expected to close in the Q4 of 2019. And then last transaction I'll touch on is an agreement to sell a further 33% interest in our Chilean toll road business at a purchase price that's consistent with the sale of the initial 33% interest that closed early this year.
The sale will result in an after tax IRR of 16% in U. S. Dollar terms and a multiple capital of 2.4 times. The sale is expected to close in the Q4 and will result in $170,000,000 in proceeds to BIP. Now looking ahead, our outlook for Brookfield Infrastructure is positive as our financial position remains strong and much of the business is underpinned by networks with high barriers to entry and cash flows that are highly regulated and contracted.
For 2020, we anticipate our organic growth to be near the top end of our 6% to 9% long term target range. In addition, we expect that our recently secured investments will be fully contributing to results next year and generating an average going in FFO yield of approximately 12%, which is highly accretive to our results. So in summary, our priorities for the year ahead are fourfold. First, we're focused on closing the $1,100,000,000 of recently secured transactions and those include the 2 marquee transactions I mentioned earlier. 2nd, we're pursuing a robust pipeline of new opportunities, which could lead to another year of outside investments.
3rd, we'll continue to execute on the next phase of our capital recycling strategy with an objective of generating over $1,000,000,000 in proceeds from asset sales in 2020. And finally, we are advancing the creation of BIPC to enhance the accessibility of Brookfield infrastructure to investors. And that, as I mentioned, we're targeting to complete in the first half of next year. So that concludes our remarks for today's call. I'll now pass it over to the operator, and we'll be happy to take some questions.
Thank
Our first question comes from Cherilyn Radbourne with TD Securities. Your line is now open.
Thanks very much and good morning.
I wanted to start with
a question on BIPC. It sounds like the launch is progressing well. And one of the questions we get from investors is how the initial $2,000,000,000 float might grow in size over time. So maybe you can talk about that.
Hi, Cherilyn. Maybe I'll start, but Bahir is closer to Laws and Mechanics. Maybe I'll have him just add anything if I missed anything. But you're correct. We expect the initial market capitalization to be about $2,000,000,000 dollars I think the opportunities to increase really relate to additional cost base we have in the company and our ability to do follow on distributions to investors.
We also will have opportunities to issue new units in the future, whether that's as part of transactions or as part of just new capital raises. So I'd say those are the primary ways that we'll see the scale of BIFC's market cap growing and float growing. There are other things that we're looking at, which are probably a little premature to get into, but there may be other things to do as well.
Great. And then on the Brazilian electricity transmission business, we haven't talked about that in a while. Can you remind us how much capital should ultimately go into that build out? And how we should think about the cadence of FFO ramping up over the next 3 years?
Hi, Cherilyn, it's Bahir. Maybe I'll tackle that one, give you all the numbers and maybe Ben Fawn might want to add some color. But to date, we've spent about $230,000,000 of capital, about $60,000,000 of that it was the equity, bps equity portion. And we'll probably have about another $100,000,000 to go to complete the build out and that would be BIP's portion. In addition to that, we're always we probably will buy out our partners' interest.
You would have seen in the quarter, we bought out our partner's interest in the 2nd operating line, albeit that was pretty small in the grand scheme of things. As the business grows, that component is going to grow as well and it's going to be about $200,000,000 So when all said and done, BIP would probably spend anywhere between $400,000,000 to $500,000,000 in that business. And as far as the run rate FFO in that business, It will probably be probably about $60,000,000 if I have all my numbers straight. Today, the contribution is pretty small, but a lot of that is back end loaded Cherilyn comes into 2022. I'd say 60% of that number comes actually in 2022 and the rest is more done on a staggered basis.
Great. That's helpful. And that's my two questions. Thanks.
Thanks, Sharon.
Our next question comes from Robert Kwan with RBC. Your line is now open.
Great. Good morning. Actually, if I can just follow-up on that here. So $60,000,000 of FFO on $400,000,000 to $500,000,000 of total investment. Is that correct?
That's right, Robert. Yes. I'd probably say $60,000,000 on $400,000,000 Yes, Joseph, right.
Okay. So 15% kind of FFO yield. Okay. You also talked about in the New Zealand business, number of things that you're doing to kind of improve margins and you mentioned significant improvement. I'm just wondering kind of similar, are you able to quantify how big that could be as well as just the types of things that you're doing?
Hi, Robert. I'll start and others might chime in. So our going in FFO yield in that business will probably be in the mid double digits. After maintenance CapEx, Don, more looking at this number on an AFFO basis, so it will be in the high single digits. There's going to be a number of margin improvement programs that we're going to be executing actually in the next 12 to 24 months.
I think at this stage, we'll probably refrain from describing totally what they are, but that should take our AFFO yield into the 11% to 12% range within the next 2 years. I think as we progress the various plans there, we'll have some more color to add as to exactly what we're going to be doing there. And so we look forward to updating you in subsequent quarters on that.
Great. Okay. And if I can just finish, turning to the Australian Rail business. Can you just talk about some developments down there, things that are going on? If you can touch on the grain side of things as well and whether there may be some capital associated with moving more grain?
Yes, Robert, it's Ben speaking. I can touch on that. Yes, the Australian Rail business is going well. On the grain side, we have a new contract in place with our CBH, which is our major grain client down there. And we expect volumes to be very consistent and grow modestly over time as they have for many years.
And in fact, our arrangement with them going forward includes, I think, good pricing, but also a contribution of the capital to maintain the tracks. And so we don't expect anything other than sort of a steadily appreciating flow of grains on the rail and sort of a growing relationship over time with the grain haulers.
Maybe the only thing I'll add, I'll just add 2 comments to what both Bahir and Ben mentioned. On Vodafone, the nature of the initial efforts underway really are in relation that you would expect with a corporate carve out, where we're eliminating a number of the corporate costs and transition arrangements that we have in place with Vodafone. And so there will be, we think, some initial low hanging fruit to do that, and SAPS as a standalone company. And then in relation to the rail business, Ben mentioned the grain side, which we're very pleased to move forward with the co op down there and strengthen our relationship with them and grow just grow and move grain very efficiently for all the farmers. But probably the opportunities that are most meaningful these days relate to just some of the iron ore mining companies that continue to look for opportunities to increase production.
We have a couple of customers who have initiatives underway. And today, most of the contracts we're signing with people tend to be on the shorter term side. We haven't seen someone commit for 10 plus years, but we are signing 2 3 year contracts for higher volumes, which again is all positive for the business.
Great. Actually, that's great color, Sam. Just on some of those contracts, are those just using existing capacity on the lines? Or and if it is deploying capital, how do you think about that given the shorter contracts and just some of the history you've had around iron ore movement?
Yes. So that's a great question, and that really comes down to the nature of the negotiations that we have with our customers, to the extent that we can just invest modestly to manage the additional tonnage, then it's an easy discussion and those are being done to the extent that some of them are looking for larger investments from us, then that's when we're looking for longer term contracts in place or other financial assurances in order to get deals done. So today, most of them have done on the shorter term minimal capital involved, but we are hopeful that we can do some longer term contracts that might involve us deploying some capital.
Perfect. Great. Thank you.
Our next question comes from Rupert Merer with National Bank Financial. Your line is now open.
Good morning.
Good morning, Alex.
I have a couple of high level questions on the economic outlook. First, it looks like we could have some positive news on trade disputes this morning with a potential rollback of tariffs. I think you've said in the past that you've seen a limited impact from trade disputes on your logistics business. Is that still the case? Or do you think you could see some direct visible benefits from a reduction of tariffs?
Maybe I'll start and then Ben or Bahir might chime in as well. Yes, I would say for most of our businesses, they're not impacted directly by some of these trade situations. But there are regions where the some of the reductions in overall global trade might impact our business is on a longer term basis. So today, probably the 2 countries where we have the biggest logistics investments would be in Brazil and Australia. In Brazil, it's more of an agricultural story.
So depending on how the U. S.-China trade war plays out, that can either be very, very positive for Brazil or it could be kind of neutral, depending on if agriculture volumes decline in the U. S. So that's one factor. In Australia, the Australia economy is really dependent on how well China does.
And to the extent that China is negatively impacted by these trade wars with the U. S, then it has sort of a bit of a reverberating impact on the outlook for Australia. Today, our businesses there are a little slower than we seen in the past. I mean Australia has been the success story of the last 25 years, and it's still doing fairly well, all things China.
All right, very good. Thanks for the color. And secondly, in Investor Day, you highlighted that you're well positioned in the event of a global economic downturn. Just wondering how your view on the global economy is informing your decision making process for the timing of investments? And can you give a little bit of color on the pipeline of opportunities today and what your thoughts are about investing in this climate?
Okay. Maybe I'll jump in here as well. So look, I think we're somewhat agnostic as to whether or not we're investing into weaker or stronger economic conditions because we tend to take those into account in all our underwritings. What we typically look for and probably the most important factor that affects the pace and posture of our investment program is the scarcity of capital. We tend to and I know I've said this on many calls in the past, look to deploy capital where money is scarce or where people don't have access to capital and stay away from those regions where capital is abundant and being given away.
And so having a global franchise where we can move capital amongst different sectors in different regions allows us to invest in a way we think where we can achieve good risk adjusted returns. Where that translates today is we are seeing better opportunities in the data and energy sectors. Those are the 2 sectors where capital is more scarce than, let's say, in the utility sector or transportation sector or in certain parts of the transportation sector. And then from a global perspective, we see good opportunities in Asia, in particular India. There's a banking crisis.
And so people like ourselves who have access to international credit can buy assets there, I think, at good value. South America is a region that today capital isn't as strong as other markets. We find North America is not too bad, particularly in the energy sector. We think we can find good opportunities here. And maybe the most challenging market where capital is abundant and being priced unfairly today would be Europe, and that's largely due to negative interest rates and people just trying to race to the bottom.
But even there, we still find some opportunities once in a while. So I hope that gives you a little bit of color. I realize it's high level, but
That's perfect. So thanks very much.
Our next question comes from Robert Catellier with CIBC Capital Markets. Your line is now open.
Good morning. Thank you. I just wanted to see if you can provide more color on GWR in closing that transaction, whether or not you expect it will be a clean closing or if you'll have to structure around either the Roper situation or any competition concern?
Hi, Robert. So the great news is that the 2 most important approvals we have received, which is shareholder approval, number 1, and 2, the Surface Transportation Board approval. The last critical approval that we need is CFIUS approval, which is one that all foreign investors generally required to buy assets in the United States. Given our footprint in the United States and the numerous transactions that Brookfield as a whole has done in the U. S, we feel highly confident that we should get those that approval and hopefully get it relatively soon.
And so I think as far as completion risk, we think it's relatively low at this stage. We also had some great news this week on the financing front. Bahir and his team did an unbelievable job in executing financing and maybe I'll let Bahir do a little victory lap here.
Thanks for that, Sam. Yes, so just picking up on what Sam just noted, we did finance the debt related to this acquisition. In total, we'll be doing about $2,500,000,000 in the U. S. Bond market.
This financing was very well received by bond market investors. The deal was almost 5 times oversubscribed, done at LIBOR plus 200, which is well, well inside of our underwriting case, which is a terrific start for us. And our understanding is that this is the most successful debt financing done in the leveraged finance market at least since the financial crisis. So that was terrific and really highlights the robust credit characteristics of this business and the underlying strong fundamentals and the scale of the business that we're acquiring. So very, very positive early start for us on this acquisition.
Okay. And just one test to Brookfield's appetite for investing in the Middle East. There's been some energy deals there recently. How would you describe Brookfield's appetite for investing there, particularly energy assets?
So it is a region we'll consider. We have lots of strong relationships with a number of the sovereign funds in that region. They've been great supporters. As you mentioned, there have been a few transactions that have been completed over the last 12 months, particularly in Abu Dhabi. And we've also looked at district energy assets in that region as well.
Yes, it's not a market where there's a lot of investment activity. They tend to come up every once in a while. So I can't tell you that we will do something, but I would just say that it is a region that we would consider.
Okay, great. Thank you.
Thanks, Norman.
I'm showing no further questions in queue at this time. I'd like to turn the call back to Mr. Pollock for closing remarks.
Okay. Well, thank you, operator, and thank you, everyone, for joining our call this morning. We look forward to updating you on our progress next quarter. And so on behalf of my colleagues, we wish you the best for the rest of the year. And if we don't speak before the holidays, happy holidays.
Ladies and gentlemen, thank you for participating in today's conference. This concludes today's program. You may all disconnect. Everyone have a great day.