Good day, everyone, and welcome to the EVERTEC Incorporated Third Quarter 2014 Earnings Conference Call. As a reminder, today's conference is being recorded. And at this time, I'd like to turn the conference over to Peter Harrington, President and Chief Executive Officer. Please go ahead, sir.
Thank you, operator, and thanks everyone for joining us on today's call. Before we begin, I want to take a moment and formally introduce Alan Cullen. Alan joined us in October as Executive Vice President and Head of Investor Relations. In addition to managing our IR department, he will also be leading our enterprise risk management and strategy functions. Alan has nearly a decade of senior management experience in publicly traded companies.
He was previously with Triple S Management and First Bancorp, serving in roles which included Investor Relations, Communications, Marketing and Planning functions. We believe he will be a great addition to the EVERTEC team. With that, I'll turn the call over to Alan, who will walk you through today's agenda
and our safe harbor. Alan? Thank you, Peter, and good afternoon, everyone. I'm very excited to be at EVERTEC and I look forward to getting to know each and every one of you in the very near future. Also with us on today's call is Juan Jose Roman, Executive Vice President and Chief Financial Officer.
In terms of the agenda for today, Peter will begin by providing a summary view of our financial results and market opportunity as well as an update on our operations. Juan will then discuss additional details regarding our Q3 results as well as our guidance for 2014. We will end as always by taking your questions. A replay of this call will be available until Wednesday, November 12, 2014. Access information for the replay is listed in today's financial press release, which is available on our website under the Investor Relations tab.
As a reminder, this call may not be taped or otherwise reproduced without EVERTEC's prior consent. I would like to remind everyone that this call may contain forward looking statements as they are defined under the Private Securities Litigation Reform Act of 1995. These forward looking statements about our expectations for future performance are subject to known and unknown risks and uncertainties. EVERTEC cautions that these statements are not guarantees of future performance. All forward looking statements made today reflect our current expectations only, and we undertake no obligation to update any statement to reflect the events that occur after this call.
Please refer to the company's most recent annual report on Form 10 ks filed with the SEC for factors that could cause our actual results to differ materially from any forward looking statements. During today's call, management will provide certain information that will constitute non GAAP financial measures under SEC rules, such as adjusted EBITDA, adjusted net income and adjusted net income per share. Reconciliations to GAAP measures and certain additional information are also included in today's earnings press release. With that, I'll turn the call back over to Peter Harrington, our President and CEO. Peter?
Thanks, Alan. We saw another quarter of further growth in our Merchant Acquiring and Payment Processing segments, while the Business Solutions segment continued to be affected by lower hardware and software sales. In the 3rd quarter, total consolidated revenue grew 1% and adjusted net income per share grew 11% to $0.40 per share. Excluding hardware and software sales, our consolidated revenue growth was 4% year over year in the 3rd quarter. Looking deeper into the segment, starting with payments.
Merchant Acquiring net revenue grew 6% year over year and payment processing grew 4%. During the quarter, we witnessed an unexpected and what we believe to be a temporary period of softer consumer spending in Puerto Rico, potentially driven by a weakening in consumer confidence. This may have been driven by concerns over uncertainties caused by the government actions such as new taxes to individuals and corporations as well as the public discussion of a possible default by the electric power authority PREPA and the resulting impact on consumers. Concerns about PREPA have waned somewhat after the bondholder agreement was reached and a restructuring company was put into place. We believe these factors had an adverse impact on transactions and payment volume, particularly in August September, which affected our revenue growth in the quarter.
Within Puerto Rico, our POS processing transactions were up approximately 5% year over year in the Q3, compared to the 7% to 8% range we have seen in the first half of the year. As recently as October, however, we are seeing some positive signs that consumer spending trends have started to improve. In the month, we've seen that the a number of transactions are moving back towards where we saw them again in the first half. As a reminder, we process over 70% of all the card transactions on the island. So we believe our own transaction growth is a strong proxy for the Puerto Rican payments market as a whole.
And while it is still very early, we are encouraged that transaction growth in October is back to its normal historical rate. Outside of Puerto Rico, we generated 9% year over year revenue growth in our payments business in the 3rd quarter. As our results indicate, demand for our card product and POS processing solutions remained solid throughout these markets. While at the same time we continue to benefit from high levels of transaction growth driven by the ongoing cash to card tailwind and strong economic growth. Looking forward, we continue to see significant opportunities for growth in our payments business.
Our pipeline for new business remains strong and we continue to win new customers and further expand our relationship with our existing customers. And we are making substantial progress on our initiative to expand into newer markets such as Colombia. Let me provide you with an update on our progress we're making in Colombia. I'm pleased to announce that in late October, we successfully brought our 1st Colombian processing customer onto the platform. This is a significant milestone in our Colombian expansion plan.
The starting up of the processing business along with the Visa Principal Member license will allow us to grow over the coming years in an attractive and expanding Colombian market in both the payment processing and merchant acquiring businesses. As we've said consistently, our aim is to expand in Colombia as well as other Latin American countries, both organically and through acquisitions, joint ventures and alliances. Moving to the Business Solutions segment. Our Business Solutions revenue decreased 2% year over year in the 3rd quarter. Similar to the first half of the year, Business Solutions growth was affected by lower levels of hardware and software sales versus last year.
Excluding hardware and software sales, business solutions revenue grew 3% consistent with our earlier 2014 results and our expectation for the business in general. Overall, we continue to see good demand for our reoccurring business solutions products and services such as IT consulting and core banking. Turning to our full year 2014 outlook. We continue to expect adjusted net income per diluted share to be in the range of $1.65 to 1 $0.71 However, based on the continued low levels of hardware and software sales in the Q3 and the number of hardware and software related projects we expect to deliver in the Q4, we now forecast consolidated revenue for 2014 to increase approximately 1% to 2% versus last year. EVERTEC continues to benefit in the market from our comprehensive set of end to end processing solutions, leading brand and solid execution.
We continue to develop strong multi year relationships with new customers and broaden the relationship with our existing customers throughout our Latin American footprint. We feel good about the long term outlook for our business, demonstrating our confidence in our long term growth prospects and our commitment to enhancing total shareholder value, in September, we announced a new $75,000,000 stock repurchase program, which Juan will discuss with you in more detail shortly. In summary, we faced some challenges in the 3rd quarter, but our results continue to reflect the strength of our diversified business model. We made solid progress on our growth strategy in Colombia and we'll continue to position EVERTEC for accelerating growth in that market. Moving forward, we will remain focused on leveraging our competitive advantages to capitalize on the strong secular growth in our payments markets and win share.
In addition, we will accompany our organic growth with investments that add to our current business and expand our geographic footprint. With that, I'll turn the call over to Juan.
Thank you, Peter, and good afternoon, everyone. I will begin by providing a detailed review of our Q3 financial and operating results and then conclude with an update of our 2014 guidance. Total consolidated revenue was $88,600,000 in the 3rd quarter, an increase of 1% compared with $87,400,000 in the prior year period. Merchant acquired net revenue increased 6% to $19,200,000 from $18,200,000 in the prior year period, driven mainly by an increase in transaction volume. Payment processing revenue increased 4 percent to $25,600,000 up from $24,700,000 in the prior year period.
Growth was driven mainly by an increase in our car product business, resulting from new customers' additions and more accounts on file in our Latin American operations and an increase in POS network and processing transactions. Our payment related businesses outside of Puerto Rico continued to grow at a solid pace in Q3, up 9% compared with the prior year period, driven mainly
by car product processing.
Our Business Solutions segment revenue decreased 2% to $43,800,000 in the 3rd quarter compared with $44,500,000 in the prior year period. This decrease was due mostly to a decline in hardware and software product sales in the quarter, partly offset by increased revenue in core banking solutions and IT consulting services. In the 3rd quarter, revenue from hardware and software sales decreased by $1,900,000 compared with the prior year period. Excluding hardware and software sales, Business Solution revenue grew 3% year over year. Moving to expenses.
On a GAAP basis, our 3rd quarter total operating expenses were down approximately 5% compared with the prior year period. Cost of revenue, excluding depreciation and amortization, was 38,600,000 dollars essentially flat with the corresponding 2013 period. Selling, general and administrative expenses for the quarter were 7,100,000 down $1,900,000 or 21 percent for the corresponding 2013 period. This decrease was due mainly to a non recurring $2,500,000 expense taken in the Q3 of 2013 in connection with our September 2013 secondary offering. Depreciation and amortization expense decreased $1,200,000 or 7% year over year to $16,500,000 The decrease is related primarily to lower depreciation and amortization of assets that have become fully depreciated.
Income from operations for the Q3 was $26,500,000 an increase of 21% compared with $21,900,000 in the corresponding 2013 period. Total non operating expenses were $6,300,000 an increase of $600,000 or 10% from the corresponding 2013 period. The increase was mainly due to a non cash expense of $450,000 related to the purchase accounting attributable to certain customer service and software related arrangement whereby EVERTEC received reinvestments from Popular. GAAP income tax expense in the Q3 was approximately 1,100,000 dollars versus $1,400,000 in the prior year period. Cash income tax expense was approximately 300,000 down slightly from $37,000 in the prior year period.
We expect cash income taxes to remain at similar levels for the Q4. As of September 30, 2014, we had approximately $47,000,000 of NOLs available to offset future tax payment related to our operations in Puerto Rico. Adjusted EBITDA for the 3rd quarter was 44,500,000 dollars an increase of 3% from $43,400,000 in the corresponding 2013 period. The increase in adjusted EBITDA was due primarily to revenue growth and operating leverage in our merchant acquiring and payment processing businesses. We continue to deliver superior adjusted EBITDA margins, reflecting the strength of our business model and ongoing focus on managing costs.
Adjusted EBITDA margin was 50.2% in the 3rd quarter, compared with 49.7% in the prior year. Finally, adjusted net income in the 3rd quarter was $31,400,000 up 6 percent from $29,500,000 in the prior year and the adjusted net income per share was $0.40 up 11% from the prior year, reflecting higher net income and lower average diluted share count. Moving to our balance sheet. As of September 30, we reported $29,200,000 of unrestricted cash and $679,100,000 of total short term borrowings and long term debt. During the quarter, we made a mandatory repayment of approximately $4,500,000 on borrowings outstanding under our Term A and Term B senior secured credit facilities, pays $15,000,000 on our revolver line of credit and pay dividends of 7,900,000 dollars As of September 30, total liquidity, which includes unrestricted cash and available borrowing capacity under our revolver was approximately $121,200,000 We continue to generate strong quarterly free cash flow.
For the Q3, our free cash flow defined as adjusted EBITDA minus CapEx, cash interest expense and cash income taxes was $31,900,000 compared with $32,800,000 in the prior year. The slight decrease in free cash flow was mostly due to timing of CapEx. Moving to our recently announced share repurchase plan. In late September, we initiated a $75,000,000 stock repurchase plan to be executed over 12 month period. Through October 31, we have already bought back $25,000,000 of our common stock or approximately 1,000,000 shares, supported by our strong free cash flow generation and significant balance sheet flexibility.
Finally, we remain committed to the prudent return of capital to shareholders. This afternoon, we announced that our Board of Directors declared a regular quarterly dividend of $0.10 per common share. Now on to our guidance. As Thierry mentioned, we now expect total revenue growth in 2014 to be between 1% 2% compared with our prior outlook of 3% to 4% growth. Our updated revenue guidance reflect greater risk to the hardware and software portion of our Business Solutions segment.
We continue to expect adjusted EBITDA growth at least 100 basis points higher than our revenue growth rate and fully diluted earnings per share of between $1.65 1 $0.71 We expect full year 2014 operating depreciation and amortization expense of approximately $30,000,000 cash interest expense of approximately $23,000,000 and fully diluted shares of approximately $79,000,000 Finally, we expect 2014 cash income tax expense of $1,000,000 and our 2014 effective tax rate outlook on a GAAP basis remains between 10% 12%. With that, operator, we will now open up the call for questions. Thank
And we'll take our first question from Bryan Keane with Deutsche Bank.
Hello. This is Ashish Sabadra calling on behalf of Bryan Keane. I just want to get hone in on the consumer weakness or consumer spending weakness that you saw in August September. Can you just let us know how much or where did that the POS processing transaction, how much did it drop off in August September? And then just going forward, what can you just comment on your comfort around consumer spending sustaining at the October
levels? Thanks.
All right. So we had a normal July, okay? So July was in line with how we've been performing for the 1st 6 months of the year. We saw a slowdown in consumer spending in August, the beginning part of September and then we started to see it turn back in the direction it's been. And as I said on the call, early look at the numbers for October puts it back in line with what we've been seeing for the last couple of years.
So we and we verified you can look at some of the other numbers that are out there and it looks like it was across the board in Puerto Rico. And again, there's been a lot of noise. There was a lot of noise in that time frame, which we think shook consumer confidence for a little bit. Most of that has now waned and is being dealt with and we see it going back to where it was. So I'm very, very comfortable now that we will finish the year in line with where we've been operating for the long term.
Okay. That makes sense. And just so that we can model the Q4 appropriately, should we expect given the fact that transactions have ramped up, should we expect acquiring and payment processing business to deliver more normalized revenue growth? Are there any other puts and takes going into that quarter?
No, no. We see it more on a normalized basis. There's nothing else that we there's no other puts and takes.
Okay. That's helpful. And my final question is on international. International has been slightly weak in 2nd and third quarter 10% compared to 15%. But should we see an acceleration in international going forward as you ramp up the Colombian customer?
That's correct. Yes.
Okay.
Thanks. That's it.
And we'll take our next question from Bob Napoli with William Blair.
Hi. Good afternoon.
Hey, Bob.
Alan, welcome to the team.
Thank you.
Question just on your strategy, Peter, in Colombia. I mean is this a I mean it's obviously is a very big focus for you. It's a market that has the potential to be large. And what is the operating strategy there? And how many years is it going to take to make that a meaningful contributor to the business?
Well, I think that today what we announced is really a major milestone for us Bob, right? So to grow the company organically, we needed to have the platform operating in the market. And now we have the platform operating. We have a customer up on the platform. We can now go through the normal process that we have in all of our other markets, which is aggressively sell new customers in the market.
We're in a better position today with the Visa license to go after the acquiring as we've talked about before. And we'll continue to look for partners to exploit that to be able to get into the acquiring business. So we should see revenue obviously in 2015 where we saw really no revenue in 2014. So yes, we should it should start to have a bigger impact beginning next year not just in the future and obviously continue to grow over time.
And is that like a couple of $1,000,000 potentially of revenue next year? Or I mean can you put any kind of
Yes. We're not as you know Bob, we try to stay away from given revenue per country.
And then the as I mean, maybe just following up on the last question. The non Puerto Rico revenue growth slowed from 10 percent to 9%. And I think I mean, you're certainly you're targeting at least mid teens, I think, in that. And do you see a pick and was there some did you see the same kind of slowdown in spending non Puerto Rico that you did in Puerto Rico in August September? Is there any color?
No, no. We did not see the same slowdown in the markets outside of Puerto Rico. Some of it is just as I've said before, it's the timing of when customers come on. I will give you some insight because I'll probably get asked the question, but the sales of new customers, okay, is right in line with where we expect. And to give you some specifics, we signed 3 new customers in the 3rd quarter and we've already signed 2 new customers since the beginning of Q4.
Okay. And in what markets? Is
it In multiple markets.
Okay. All right. Just last question. Besides is the strategy going to be here to really put a lot of focus on Colombia? Or should we expect you to enter another new market in 2015?
As I've always said, once we got into a position where we had momentum in Colombia, we would look to the next market. I think you can take away from that that we are getting closer every day to that point, especially now that we have the platform operationally in Colombia. We will probably in 2015 seriously start looking at what the next market is.
Thank you.
And we'll take our next question from Tien tsin Huang with JPMorgan. Thanks. Hope you can hear me okay. I'm at the airport. Just wanted to ask on the hardware and the software slippage similar to what I've asked in the past here, Peter.
Just is that business you expect to pick back up again in 2015? Or is this just a push out? Or are these projects getting canceled or shelved?
I think in the environment we're in, I think the reality is it's we're not going to see it all pushed to 2015. That's not the case. So I think we'll probably have a better year in 2015 than we did in 2014 from hardware and software, but it's not going to be a dramatic change in the number Trot. We're going to as we've said, we don't focus on selling hardware and software. I think we're going to continue not to focus on selling hardware and software.
We're more interested in the recurring revenue. And I think the results show that the recurring nature of the business is operating exactly as we thought it would growing 3% on the Business Solutions business this quarter minus hardware and software.
Right. So this leads to my next question. Is it safe to say that IT spending I heard comments on consumer that makes sense. Just how about bank spending, bank of popular spending, government spending, things like that? How is that GA versus planned?
I would say there's certainly lower government related spending than we had planned on. And I think under the where they are today, we don't foresee that that's going to pick up dramatically in the near term.
Okay. So basically what we're seeing now is probably a good level to assume going forward. Last thing just on the buyback, thanks for the detail there. Does the guidance assume incremental buybacks?
No, Tien Tsin right now is what we did already is $25,000,000 we might do right. It will depend on market conditions. But our assumption is basically the purchase that we did in October. The program is in place and we will keep looking into when to access the market and do more buybacks. Okay.
So no incremental buybacks. That's good. So is there a 10b5 in place? Or is it purely opportunistic?
It's opportunistic. Okay. Okay.
No, that's helpful. Thanks guys. That's all I have. And we'll go next to Sara Gubins with Bank of America.
Hi. Thanks. Good afternoon. In the Merchant Acquiring segment, I know that you start to anniversary the gains from adding BBVA branches in the 4th quarter. What's the likely impact on revenue growth in that segment?
It will certainly be less than you saw in the 1st two quarters. As we've said, it's adding like quarters. So probably somewhere as we've always said somewhere in the 6% to 7% range somewhere in there.
Okay. And then as you think about free cash flow dynamics for next year, Just to check, are there any items that are worth knowing about that might have an impact on 2015 free cash flow?
Not really, Sara, besides the buyback program, obviously, that we have in place. Nothing else. As we said before, cash for focus is any expansion or acquisition. And after that, as we said, or paying down debt or a buyback. And right now, we have the program in place.
So that's what you think about is that we will continue to use our free cash flow for an expansion or to continue our buyback program.
Okay. And then just last question. What's the cash balance on hand after the recent share repurchase? And is any of that located outside the U. S.
And therefore might be taxable if you needed to repatriate it?
We do have cash outside Puerto Rico, yes, in our operations in Costa Rica. And if we move it, it will be tax if we pay a dividend from those subsidiaries. We have not paid any dividend because we keep that cash in those subsidiaries for our expansion in Latin America, just to continue doing operating our business, but also for any possible acquisition most probably will be done out of the cash in Costa Rica.
Great. And then just the overall cash balance at the end of October after the share repurchase?
We're around I don't have the number with me really. But probably it's around $20,000,000
Okay, great. Thank you.
Okay.
And we'll go next to George Mihalos with Gregg Credit Suisse.
Good afternoon. This is Allison Jordan in for George. I had a question on what the revenue growth in Puerto Rico was for the quarter and how does that compare to the growth rate in the first half of the year?
For Puerto Rico, well, you have to exclude again hardware and software sales. But our payment businesses are growing around 5%, give and take. And as we said in the Business Solution around 3% when you exclude hardware and software sales.
And for that 5% of the payment business in the quarter, how does that compare to the first half of the year?
It was faster. At the first half, as we mentioned, mostly we saw an increase in merchant acquiring, because we have the addition of the merchant for BBVA. We saw during the first half also higher POS transactions, as Peter mentioned before. So adding Oriental really is probably in the 6%, 7% our payment businesses.
Great. Thank you.
And we'll take our next question from Smiti Sethrapamot with Morgan Stanley.
Hi. This is Daniel Hussain calling in for Smiti. Just a couple of high level questions. I guess Visa is going to be raising prices for acquirers in the Q2 next year. So could
you share with us just your thoughts on
the potential to raise prices to merchants above and beyond Visa's increase?
First you got to remember that in Puerto Rico for example, which is where you're talking about the acquiring business, the majority of transactions are ATH. And so the Visa has absolutely no impact on ATH. So the impact is going to be very minimum to us. Yes. Right.
We pass on most of that as it is. But it's not today, I think we about 11% or 12% of the transactions are Visa.
Yes. They do this often.
It's not right. It's not even news. They often. Yes.
Okay. Thank you. And then maybe if you could just touch on the Alliance front in Panama and Costa Rica and if there are any updates there?
No. There's nothing we can talk about at this point. We're still actively searching for partners.
Understood. Thanks. And we'll go next to James Schneider with Goldman Sachs.
Good afternoon. Thanks for taking my question. Just a follow-up on the consumer trends within Puerto Rico for a moment. Is there anything you saw in terms of the mix of transactions whether it was ATM, debit or credit mix that would kind of suggest to you what might be going on back in August September aside from just consumer confidence and the tax impact? And related to that, can you see anything on the horizon in terms of tax actions in 2015 from the government that would kind of cause a potential dislocation like the one you saw for about 1.5 months?
To your first question, no, there wasn't any it was across the board. So we looked at the numbers and nothing jumped out that one stayed the same and something else really moved dramatically. They all we saw it in slowdown in ATM. We saw it in debit. We saw it in credit.
At this point, there's nothing that I've seen from the government related to new taxes that would have any impact. But their fiscal year ends in June 30, 2015 and so it would be more likely that it would be closer to that date that any new taxes if there were any would be announced. But right now we don't see any.
That's helpful. And then just kind of a follow-up. It sounds like you didn't see much change in terms of the transaction growth rates outside of Puerto Rico. But are there any areas whether that's Costa Rica or Dominican Republic or any place else that saw kind of a notable strengthening or weakening outside of Puerto Rico?
No. No. I think it always changes based on the customers, right? So where I bring a customer on, if I bring 2 customers on in Mexico for the sake of argument, this year over last year I'm going to see higher growth in Mexico this year. If next year I bring on more customers in Costa Rica than in Mexico it moves on an ongoing basis.
So overall, we're seeing sales growth in multiple markets within our footprint. And we're seeing the kind of fundamental secular cash to card transaction growth in all of those markets.
Okay. So no difference in same store sales kind of metrics. Okay.
And
then I guess last one would be just on SG and A levels. Do you have the potential to if we kind of hit another rough patch to ratchet those down further to kind of help cater or give us some margin on the EPS line? Or do you pretty much running at levels that you think are close to the minimum level at this point today?
Well, in the past 3 years, right, we have been making significant progress reducing our cost base. Obviously, every day there are less of those opportunities that we found when we got here. There are still some areas that we continue to look at, especially what have to do with software negotiations or purchases, especially we look into how to consolidate certain software, so you can achieve some efficiencies. So we continue to look into that impact that are mostly cost of revenue, right, more than SG and A. But that's where we are today, looking for other opportunities to consolidate or reduce costs in those areas that as you can imagine are significant part of our cost.
Thank
you. And we'll go next to Chris Brendler with Stifel. Hi. Thanks. Good afternoon, guys.
How are you doing?
Good. How are you doing, Chris?
Good. Thanks. So on a couple of questions on the international front. Peter, I think last quarter you chalked up the deceleration from mid teens down to 10% or so percent, a little bit of lumpiness to timing, now it's sort of flat to that number or to get it down a little further. Is there any like were there contract wins that you anniversaried in the Q2 or Q3 that caused the international growth slowdown?
Is there any currency impact that's weighing on the international growth?
No. It's more of a formal there's no currency issue, Chris. So it's just more the timing of lapping last year's implementations to this year's implementations. So I don't see anything we don't see any kind of slowdown there. It's just timing.
This has gone on for the last 8 or 10 quarters. They it changes on a quarter by quarter basis. But we're not seeing anything. And if anything, as I said earlier, we feel very comfortable because we've signed like 5 new clients in the last 4 months, which is a very good pace for us.
Right. So it doesn't sound like it's probably a little bit reticent to quantify the impact of the Colombian processing or any other deals. I mean, is it reasonable to expect that 9%, 10% growth outside of the Internet outside of PR is going to increase over the next couple of quarters?
Yes. Well, you should see in the 4th quarter, higher than 10%.
Okay. Great. That's good. And then just longer term strategic question basically the same one I asked last quarter like the goal here was to get to a much higher mix of revenues outside of PR. I think you had a 5 year plan of 30%.
And is that still reasonable? I mean, it's definitely taking longer, but last time we met it sound like it's the longer term,
the medium to long
term is still optimistic here. It's just taking a little longer. Is that still the case?
It is. I mean and again as we said before, it will be dependent upon transactions, joint ventures, partnerships that we do, because those are all outside of Puerto Rico. That is going to be what is going to help drive that additional growth.
Right. Okay, great. Looking forward to increases we'll be there. Thanks so much.
Okay. Thanks.
And that does conclude the question and answer portion of today's conference. I would now like to turn the call back over to Peter Harrington for comments and closing remarks.
Thank you. All right. I just wanted to say thank you very much for your support and I look forward to speaking with you again on our year end earnings call. Operator, you can now conclude the call.
And this does conclude today's conference. We thank you all for your participation.