EXPI - NASDAQ

Good afternoon, and welcome to the eXp World Holdings First Quarter 2023 Earnings Fireside Chat via live stream and EXPI Campus, our Metaverse. My name is Denise Garcia and I manage Investor Relations at eXp World Holdings. Today, we will begin our earnings fireside chat with prepared remarks from Glenn Sanford, Founder, Chairman, and CEO of eXp World Holdings and CEO, eXp Realty, followed by a review of the first quarter 2023 financial highlights presented by Jeff Whiteside, CFO and Chief Collaboration Officer at eXp World Holdings. Following our prepared remarks, we will open the call to a Q&A session with eXp World Holdings covering analysts and questions submitted to eXp. But first, let's begin with a review of the forward-looking statements. There'll be a number of forward-looking statements made today that should be considered in conjunction with the cautionary statements contained in the company's SEC filings. Forward-looking statements are subject to various risks and uncertainties that could cause our actual results to differ materially from these statements. These forward-looking statements are based on assumptions as of today, May 02, 2023, and the company undertakes no obligation to revise or update them. Please see our filings with the SEC including our most recently filed quarterly report on Form 10-Q for a discussion of specific risks that may affect our business performance and financial condition. As a reminder, today's call is being recorded and a replay will also be made available on expworldholdings. Now for a few logistics and we'll get started. For those of you joining on the eXp campus today, to see all three screens, hit the stage

Thank you, Denise. And thank you everyone for showing up today. We just finished our yearend report, just over a month ago. So today's can be a little bit of an update, relative to Q1. Obviously, one of the things that we want to just touch pieces is the fact that we got three companies, the one that we'll talk about the most of eXp Realty because that of course is what got the start about 13.5 years ago and so we'll talk a lot about of the stats there. We'll touch briefly on success. It's a personal development brand. We've just added a new CEO to that brand; Amy Somerville, who has a phenomenal background coming from both RE/MAX and Buffini & Company and prior to that, she had actually has a degree in Journalism. So it's a nice fit for her and she's been doing a phenomenal job since she's joined us there just a couple months back and Virbela, of course, this is a Virbela campus, one of many that Virbela hosts on behalf of clients. We've of course bought Virbela back in 2018 and this is the enterprise version of the Metaverse, but we also have a web-based version @framevr.io, which I encourage all of you to take a look at because I think that's where a lot of the future is the metaverse on the web, and we're doing a lot of great things there. So let's just kind of jump into some initial highlights for Q1. We did grow over 87,000 agents in the quarter, which represents the 12% year-over-year growth for, for the year. Really our big thing, and you hear me say this all the time, is we really are focused on the agent value proposition and we say that because at one point I was an active agent in the field with the struggles that agents go through and there wasn't a real estate brokerage that really met the needs that I recognize for myself and that's what put us on the path of building eXp Realty. International is actually growing quite rapidly. You'll see and you certainly can note in both the financial statements and the press release, but international has been growing at a rapid rate with 52% year-over-year revenue growth. We've got our retention strong. The agents that we do lose, almost half of them are agents who have done zero transactions and that's worth noting. Our biggest attrition is in the category of zero to two sales a year, and that makes about 75% of all of our attrition and we may touch on it a little bit later if we get some questions, but we've got a little bit of a breakdown of that cohort by different segment. We're seeing a lot of brokerages and agent teams joining EXP and we'll also -- we'll highlight a few of them. There was a press release put out earlier today. You can see many of those teams and brokerages that have made the switch over. We've got a number of them that even the beginning of this quarter are joining, which are very notable in their own right that we haven't put press releases out for. And then we did a lot of cost cutting last year. I know Jeff will go into this, but it was nice to see that even in what's historically the worst quarter of the year, we were able to actually have a little bit of net income and our adjusted EBITDA was positive. So a lot of good things going on in the quarter, just from sort of a top level perspective and all this really comes down to how do we focus on the agent value props. So with that, let's go on to the next slide. The this last year, and of course, this plays out into Q1 especially because interest rates really started to go up in late Q1 and early Q2 last year. So that's when, interest rates started to really kick up and that has put a drag on the housing market significant drag, so much so that real estate sides in the quarter depending on the data and we've got, some footnotes here as to where the data came from but transaction sides were down about 25% year-over-year for Q1. The agents in the industry are down about 0.3%, so not a huge amount, but there's a lot of agents who are still members of NAR, but have effectively opted out. So I believe that that number's actually larger than 0.3%, but that's what NAR stats are showing in terms of people just renewing their license and continuing to pay NAR dues. Our agent count in the US and this is just US data, we're really comparing it against NAR data, for the most part, is up 8.3% in the US. Of course, we're about 12% overall, and we make up about 4.9% of all realtors in the United States. And so we grew our agent base relative to our market share basis by about close to 9% this last year. So one of the things we've talked about in the past, and really the last year or so, we've talked about the fact that in a down market, we believed we would pick up market share, and we wanted to switch the focus from just pure growth to market share growth, just given the backdrop of what we thought 2022, early 2023 would look like. Our transaction sides were down about 16%, but our market share relative to transaction sides, we believe is around 4.1%, plus or minus, which means that our market share grew about 11.6% last year and so we fundamentally feel that that's going to be a continued direction that we'll see in the soft market, Q2 we'll see how it compares. My guess is that industry wide, we'll still be down Q2, maybe Q3, but we believe that we'll continue to grow market share. So when we come out the other side of this we'll be in great shape to reap the rewards of a much improved market. So let's go ahead and go to the to the next slide and this next slide is really just a little bit more of what you saw maybe in the press release earlier today. We've got a lot of top teams and brokerages that are continuing to join us and this is just a bit of highlights for that, but if you're subscribing to any of the real estate publications it's hard not to notice the fact that EXP continues to grow its market share whether it be signs on the ground in local neighborhoods, or whether it be in the press and some more of the press accolades are on the next slide, which, this year, the real trends which is does a lot of this trends reporting, they've been doing it for many, many years. EXP ranked number one in four categories. Number of sides, top mover in sides, top mover in volumes and the top independent brokerage. One that we haven't really focused on in the past but is one that's worth noting is the direct selling news, which is a publication that's primarily focused on the direct selling industry. We have got bucketed there into their tracking because of the unique way that we comp real estate agents. We actually give agents the ability to attract other agents into EXP and earn income as if they were the broker owner without having to put up all the market the capital in order to grow their business and here's akin to direct selling or network marketing. And so as a result, this last three years in a row, we've been recognized as the fastest growing company using a direct sales style comp model for our independent contractors and so we've -- it's a nice award to have, but the one we're most proud of is the Glassdoor Award. Six years in a row, we've been ranked in the top 100 best places to work. Last year 2022, we were actually ranked in the top five, which is an incredible ranking and for those of you who follow Glassdoor and long-term performance of companies that have high Glassdoor scores, it's good company to be in, especially when you think about it from a perspective, a long-term shareholder. One quote that's also unique on this slide is the one that Steve Murray gives that it's notable that EXP was the only one a top form firms that grew both its close transaction and sales volume in 2022. And of course, we're seeing that market share continue to grow. So with that, we want to just talk a little bit about some of the innovations that we're working on. Some of these you've heard about, some of the focus you've heard about in the past are focus on NPS as a big one for us. We've been focused on NPS as a key performance indicator since 2015, 2016 when we introduced it to the company at large and this last year especially our teams have really picked it up across the organization in multiple different areas. And so we've got more areas of the company that are ranked at a 70 or a higher, which is a number that we've used historically to recognize if we're at a 70 or above, things are going really well and so we're at about a 70 on our global agent net promoter score and we are actually bringing Fred Reichheld, the author of the Net Promoter Score, and a more recent book, Winning on Purpose to our Shareholder Summit here later on this month. In terms of products and support, we did a press release earlier this year talking about a partnership that we put together with realty.com with some, some exclusive benefits. We now have over 10,000 qualified leads each month going into hands of EXP agents, and we're working with realty.com to help them grow their footprint, but also in relation to our exclusive partnership benefits. Additionally they've introduced coaches and trainers that are actually supporting EXP agents over and above just supporting and managing the existing lead flow. So we're getting some great partnership benefits that are helping all EXP agents excel and we're continuing to work on that partnership to expand it, to create more opportunities for agents. And we're also using that as an analog or some of the things that we're doing with

All right, Glenn. Thank you very much. I appreciate it. Thank you, Glenn. Thank you, Denise. I think one thing you didn't mention, Glenn, was the new avatars that we have, the new look, I know a lot of people were looking for my green, but we really like the baby blue. So thanks Alex and the team for that. The campus is in great shape. So what I'd like to do today is on the first slide, and I'll review our Q1 highlights, followed by segment results and results on a consolidated basis. Starting with the highlights for the quarter at the world holding level, our revenue was $850.6 million. We did decrease 16% compared to last year and this was due to both the transactions and average selling prices decreasing year-over-year. A gross profit decreased by 12%, but the margin grew by 33 basis points, 0.6%, and we generate a positive net income, as Glenn mentioned, of $1.5 million. We generated adjusted EBITDA, $13.3 million and operating cash flow of $38.8 million. As we discuss when we begin the segment of reporting in Q4, EXP North America represents a majority of total revenue at 98% and North America Realty's revenue also decreased 16% this quarter. So that's -- it's most of the revenue we have. We have the North American Realties revenue, as, as Glenn pointed out, it is lower, but as we compare it to the marketplace, we decreased a lot less than the marketplace did, and I got some stats on that. It's the one thing that did happen, as Glenn mentioned, as that even though there was a decrease in transactions, we also had an increase in share gain and positive EBITDA, which reflects the resiliency in the model in the down market. So, international, this quarter growing revenue at 52%, we had strength in companies like South Africa, Australia, the UK, and regularly quarterly revenues in Portugal and Spain. So I'll review the Q1 financials for each segment on the next slide, please. So, as a reminder, we started breaking out segment financials in Q4 2022. On this slide, you can see that our Q1 2023 segment revenue and adjusted EBITDA for each of our four business segments and a breakout of corporate allocations. Our North American Realty segment is again the primary driver of revenue at $837 million and adjusted EBITDA of $21.2 million. So despite a very challenging environment in the first quarter, North American revenue declined only 6% year-over-year versus an industry-wide sales decline at 25%. The North American Realty remained profitable. International Realty had a record quarter increasing revenue by 52% to $10.8 million. VirBELA increased revenue by 19% and approved its EBITDA loss by approximately $1.5 million when you compare it to last year this time. Our other segment, which is primarily success, grew revenue at a 100% and while improving EBITDA losses year-over-year and so overall, it was a extremely challenging quarter for the entire industry and the segments did perform, and especially the powerhouse that we have in the North American side performed very well in this particular market. On our next slide, I'll review financial details on a consolidated basis, but we maintain a strong agent NPS, as Glenn mentioned, at 70% and agent count increased 12% the prior year. Revenue decreased minus 16%. Gross margin dollars decreased minus 12% due to lower transaction volume and lower price or gross margin percentage increased 4% or 33 basis points year-over-year. SG&A costs decreased to a slowdown in hiring as Glenn mentioned. So this is in previous periods and a reallocation of agent growth incentive stock compensation expense, the commissions and other agent related costs. Net income was a positive $1.5 million generated $13.3 million of adjusted EBITDA. Our operating cash flow was $38 million, and we ended the quarter with $122 million of cash and cash equivalents. So on my final slide that I have for the first quarter, what we see here is just taking a step backwards and, I really like to look at what the company's accomplished, though from a historical perspective, growing our agents and our revenue consistently since 2017. Chart reflects how recent marketing conditions have impacted revenue, which we expected in this quarter, but we continue to increase EXP agent count, which grew 12% year-over-year. This quarter, we continue to generate positive cash flow with zero debt on the balance sheet and a very healthy cash balance. So with that, I'll turn that back over to Denise and for Q&A.

Thanks, Jeff, I'll kick off with a question for Glenn before we open up the call to our covering analysts. First, Glenn, can you share your thoughts on your first quarterback as CEO of EXP and what you're hearing from agents about the broader market?

Yeah, so January 03 came back as in the role of CEO. It's been -- it definitely was, has been a role up the sleeve, especially the first 2.5 months of just reorienting the agent centric model a little bit. Just obviously every CEO is going to have a slightly different focus and, one of the things I'm hearing not as much negative in the marketplace from an agent perspective relative to sales volumes. Part of it's probably seasonal because March is historically the beginning of the selling season. So those who were feeling it taking it on the chin last year, through the mid-year and the summer and the fall, they've adjusted the new normal. So I believe that we're now fully into the new normal in terms of sales volumes and those types of things. So now it will be more of a steady growth. I think once we get into, especially Q3, Q4, we'll actually start to see year-over-year growth rates is my guess and I think agents are starting to pick that up as well.

Got it. Okay. We'll take our first question from John Campbell. John, I think your mic's open.

Yeah. Good afternoon guys. Thank you for taking my questions. Jeff, on the OpEx, obviously that dropped a good bit from 4Q. I think you called out a reallocation of some of the stock-based comp moving that to the cost of revenues. So that kind of explains the I guess the lower gross margin sequentially. But maybe if you could help quantify that impact and help us get a better grip on what that I guess under the prior accounting, what that OpEx would've looked like this quarter relative to last?

Yeah, so, we're talking about a year-over-year, John, it was approximately about $7.8 million. So that was a difference quarter over quarter. Okay. That was the change and it's just, what's happened is that, it's just looking at how to classify different accounts. We do this on a relatively regular basis, and this is just a change we decided to make as a company.

Okay. Makes sense. And then Glenn, I saw the press release this morning where you guys were highlighting, the flurry of agent editions, and you spoke to this briefly just a second ago, but from what you've gathered from those teams, I know you tend to get involved in some of these recruiting efforts, but from what you've gathered from those teams that joined the platform, was there a common theme cited as the why and why now as far as making that switch. Is there anything new in the EXP model that kind of drove that decision to make the move now?

No, I think, we're tending to work on building out partnerships and relationships with various folks, but, we definitely can provide certain benefits that's tough for other companies to provide because we're one large brokerage. So we're starting to get we'll call it a over indexing of referral-based business opportunities. So that means that agents and brokers that are affiliated with EXP are going to get those types of opportunities. I don't know that that's fundamentally recognized in the marketplace, but the reality is, is that when certain large scale vendors have one conversation with Leo and our revenues division and they can now have a home for hundreds if not thousands, if not tens of thousands of potential leads as versus going through a more franchise model or a system that's significantly smaller, we think that there's certainly opportunities there. And we do know that there's some agents that literally knew about some of those relationships coming over and some agents made moves because of that. I don't know, it's a huge, huge factor, but we're just continuing to help agents do more business is really what it comes down to. And our overall value prop is resonating well, and a lot of offices, by the way are reducing their costs closing down, they've merged or they're getting ready to do something. And I think that's also created a, an opportunity for them to get ahead of that and make the move first versus waiting for their office or brokerage or brand to switch to some other model. So there's some opportunistic moves as well.

Okay. That's great color. Thanks Glenn. Thanks Jeff.

We'll take our next question from Tom White from D.A. Davidson.

Great. Thanks for taking my question. Love the snazzy new avatars. Maybe just a follow up on the G&A kind of OpEx question, I guess, even adjusting for that reclass, it's still a very kind of nice down tech quarter over quarter in G&A. I realize you guys kind of want to remain nimble and flexible, and if you see interesting kind of investment opportunities, you may move quickly, but just can you help us think about like the durability or like, is this kind of a good level to think about over the next few quarters and in terms of modelling? And then just secondarily I may have missed it, but I'm not sure I heard much discussion about success lending, Glenn, just curious if you can kind of give an update on what's happening there.

Yeah, I can take the question on the SG&A. So yeah, and so, as you're aware, we didn't go into like a full cut all the cost type thing. We wanted to support our agents. We wanted to invest and we did okay, but we did recognize the downturn halfway through last year slowed down the hiring. Okay. And so, but what we do see, as Glenn mentioned, I mean, we do see it coming back. So, as we don't know exactly when that's going to happen towards the end of the year is kind of what the forecasts are kind of looking like. So those numbers will go up, but I don't think they're going to go up dramatically Tom over the year. But again, as we've said from the get go, if we see opportunity to make the investments in staff and support and NPS, we're going to do that but, I think we are seeing a pretty good effect of adjusting last year and also, I think when you look at this SG&A number now too, it's probably -- it's probably a better representation of what we're really spending in the business to run the business and that will be like that going forward.

Yeah. And relative to success lending one of the things that, obviously we saw interest rates go up, that's the big drag on the housing market. I think that lending's still in a little bit of a challenging spot, but I feel like we're at the turning or we're going to turn the here in the next quarter probably by Q3 to start to actually see it actually be accretive to EXP. Right now it's a little bit of an expense item while we're building out the nationwide infrastructure and we started it at what could be considered the right time or the wrong time depending on how you look at it. But we're well positioned to be able to actually start to get benefits. But we are, we're running loans through it that, there's 30 loans, 40 loans, 50 loans, maybe a 100 loans going through it a month depending on the month and so I expect that's going to just continue to grow and as we as we get toward the end of the year, we expect that there's going to be more uptake into those services.

Okay. May, maybe I'll squeeze in one last one, if I could, in the press release and also in the presentation Glenn, you touched on kind of iterating on the agent value prop and it sounds like at least for this year and kind of giving them market backdrop, what you're kind of really talking about there is, is trying to like drive more leads and just help these guys kind of generate more business via leads and partnerships and that way. I guess if you look out like two or three years, and think about all the different things that kind of go into the agent value prop from leads to technology to just like the compensation model, where do you see, where do you think kind of the, the most likely areas that are likely to see kind of meaningful kind of evolution or improvements in terms of ways for you guys to add value to agents of across those buckets maybe?

Yeah. So well, first and foremost, obviously lead gen's going to be the thing that's going to be most meaningful for agents. We're in a unique backdrop in that, we didn't mention it so yet in this call. So, I'll just mention it because we're not talking about AI. We're probably missing the, the ball. We just ended up having an offsite last week where we were looking at, how is AI going to impact our business and could it bring the cost to operate down? And we think that would be the case long term. So as we look at, different technologies and if we can drive down the costs of the brokerage, then there's in theory opportunities to drive down some of the costs from an agent perspective while providing the same or better benefits. So that's kind of the way we're thinking about it. One of the other conversations, and this is so you kind of at least know what's in my head, I think about long-term enterprise value being to some extent market share driven and so for us, it's still very much of how do we continue to build this to get to a more meaningful market share so that, in a number of years, we'll be able to look back and go that, we did get to whatever the number is, 500,000 agents or more worldwide. And so part of it is, is making sure that our value prop does in fact attract agents while not fundamentally losing money as a company to get there. And then we think once we get to, again, what we call worldwide scale, we're investing international, that's our biggest investments in the business but then there'll be a lot of opportunities for other opportunities for revenue. So we kind of see it as being all of the above over time, create more efficiencies, create better engagement, lead generation efforts, and then translating that into better economics for agents over time.

Great. Thanks, Tom. We'll go to our next question from Matt Phillips from William Blair.

Hey Glenn and Jeff, you have Matt file on for Steven Sheldon. Thank you for taking my questions. Wanted to start with one on the international front, when do you think you could reach breakeven or positive adjusted EBITDA there or the focus remained mostly on growth as we think about the next few years, given the size of the opportunity? Curious on how you're thinking about that.

Yeah, so what we -- what we haven't done is we haven't broken out the individual countries in the breakout of international. And there's obviously -- we believe that over time, we'll grow to, somewhere close to a 100 countries and so from that perspective, there's a lot of investment to get into all those countries. But at the same time, the UK I believe actually has to do filings in the UK even as a company inside of EXP where it's actually profitable and at least in some other countries that are close to or there already. So, we think about international as not being one big bucket. We think about it as there's a number of countries that are in that bucket and each country is going to get to net-net profitability at different times and we want to just continue to invest and reinvest so we can eventually get to all of those countries. So we're really not focused on making international profitable as an overall group at any particular time, but more focused on the countries in that we do launch focused on can we get to those to profitability in 18 months or so, which is -- and when the market was going strong, we believed that that was actually the timeframe. So now it's probably a little bit longer. It's probably 24 months or so, just in the current backdrop, but we still think that each country has a path to net-net profitability and not a significant length of time. But we have, as maybe noted, we haven't talked about it, but we haven't launched as many new countries lately and part of that is actually to work on the formula, the international formula to get more countries to profitability quicker and figuring out what are the best practices that have been working and then also just given the backdrop, we slowed down just to be financially responsible with the monies that we have in hand prior to going back into growth mode.

Got it. Thank you. Very helpful color, can gears a little bit here given the large professional development TAM that success coaching is addressing, was wondering if you could talk about the monetization strategy there, longer term vision for success coaching and what performance with that initiative has looked like so far?

Yeah, so on success I would say that with Amy joining us on the CEO role, I am got first-hand visibility into what she's doing. She's rebuilding the entire success ecosystem from the ground up. We have some partnerships and things that we're going to be announcing at shareholders for agent coaching initiatives and courses and all of that specifically for real estate. And then we'll also be focusing on the broader personal development industry over time. But her specialty is real estate, real estate coaching and professional development. So that's where the first focus is going to be and while still maintaining the more open brand of success to the larger personal development community. So it's still -- it's early stages. I would say that probably by the end of Q2 when we have this conversation, I'll be able to provide you more color as to what's going on with success.

That sounds great. We'll be looking forward to it. That's it for me. I'll jump back in the queue here.

All right, thanks Matt. So now I'll move on to questions from the audience, but before I do, I'll repeat the instructions in case we have other folks that want to get onto slide and ask a question. You can go to the furthest screen on the left and with your phone scan the QR code there, or you can go to slido.com and type in the event code EXPI to submit a question or vote up existing questions. So for now, I'll take a question from David Marsh. He's an EXP associate broker and a shareholder. He noted in today's press release, the company repurchased approximately $29.9 million of common stock during the first quarter of 2023. Do we have a total share count repurchase?

Just give me one second. I'll get on that if you want to just move forward a little bit.

And again if you'd like to ask a question, you can go to slido.com either by scanning the QR code on the upper left hand screen, or you can go or sorry, or, or this or the QR code in the upper left hand part of the screen. Or you can go to slido.com and enter in the event code EXPI.

Any other questions there, Denise, while we're waiting for Jeff?

No, I don't see any on Slido.

Okay. Any more questions from the covering analysts otherwise, obviously we'll wait for Jeff's research.

I can hop in there, Glenn. Maybe talk a little bit about and specifically what the model there is in terms of lead gen, whether that's the kind of exact model that you en envision kind of bringing here and is there an explicit kind of direct revenue opportunity for EXP World Holdings? Or is it, mostly about just generating leads for agents that obviously the company will benefit from if transactions get done. But, I'm just curious whether there's also kind of an added revenue opportunity if you guys can kind of more directly monetize that with your agents.

Yeah, there definitely is. So, when we purchased

Great. Thanks, Glenn. We have an another question from the audience, but wanted to let you everyone know that the answer from Jeff regarding the number of shares we purchased in the quarter is in the chat and it was 2.3 million. So I'll go to a question from anonymous. Will there be pen up demand and Q4 and Q1 when the interest rate cycle hopefully starts trending down that EXP might not be able to service due to cost cuttings?

It shouldn't. We did cut costs last year for sure part of it's because we recognized that we were going to have a slower market but the other side is that we've actually been hiring to keep up with demand. So, obviously have grown our staff when we were growing at, 30%, 50%, a 100% year over year in the past and we actually have a -- we have a better team, better workflows and we also now have a more global workforce as well. So we have a lot of sort of, we'll call it back office functions are starting to be served in markets where we can flex up and down staff. We have the forward facing agent facing staff, which is generally in the market those agents are in and then we have, the ability to flex up and down with some of the more repetitive type activities, whether it be on the accounting transaction calculations and other things. And then we're also, as mentioned earlier, we're looking at where does technology play a role or where does AI and machine learning play a role in helping us with scale as well? So I don't feel like we have, we'll have any issue. In fact, if you think about Q4, Q1 specifically, those tend to be slower quarters and it's really, it's Q2, Q3 next year when most likely we will see the biggest amount of increase and we typically will staff in advance of what we're seeing in the data.

Great. All right. I'll move on to the next question from the audience. Chris, Darren asked, is there any foresight on agent count for this year and or goals of the company to grow the number of agents at EXP for 2023?

Yeah, so what we noted was obviously the market share games and the numbers. When you're fighting the headwinds that we're fighting at the moment with agents either leaving the business or fundamentally leaving, even if they're not leaving NAR membership, that does play a little, it's a little tougher to grow through that. We've been talking about the idea of around 95,000 agents at the end of the year, and based on just our current trajectory, same numbers you, you are looking at as well, that might even be as slightly optimistic for yearend depending on how international goes and Canada we're on the verge of I think breaking over 6,000 agents. I think the international I is really going to be where we get the most growth in the balance in 2023, I think US is got the most headwinds. And so that's where, we still think we'll grow, but it's not going to be as much as certainly we've done in, in past years and so that's kind of where we're sitting.