LINC - NASDAQ

Good day and welcome to the Q2 2023 Lincoln Educational Services Earnings Conference Call. [Operator Instructions] Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker today, Michael Polyviou. Please go ahead.

Thank you, Abigail and good morning, everyone. Before the market opened today, Lincoln Educational Services issued its news release reporting financial results for the second quarter ended June 30, 2023. The release is available on the Investor Relations portion of the company's corporate website at www.lincolntech.edu. Joining us today on the call are Scott Shaw, President and CEO; and Brian Meyers, Chief Financial Officer. Today's call is being recorded and is being broadcast live on the company's website and a replay of the call will be archived on the company's website. Statements made by Lincoln's management on today's call regarding the company's business that are not historical facts may be forward-looking statements as the term is identified in Federal Securities laws. The words may, will, expect, believe, anticipate, project, plan, intend, estimate and continue as well as similar expressions are intended to identify forward-looking statements. Forward-looking statements should not be read as a guarantee of future performance or results. The company cautions you that these statements reflect current expectations about the company's future performance or events and are subject to a number of uncertainties, risks and other influences, many of which are beyond the company's control that may influence the accuracy of the statements and the projections upon which the segment and statements are based. Factors that may affect the company's results include but are not limited to the risks and uncertainties discussed in the Risk Factors section of the annual report on Form 10-K and the quarterly report on Form 10-Q filed with the Securities and Exchange Commission. Forward-looking statements are based on the information available at the time those statements are made and management's good faith belief as of the time with respect to future events. All forward-looking statements are qualified in their entirety by this cautionary statement and Lincoln undertakes no obligation to publicly revise or update any forward-looking statements, whether as a result of new information, future events or otherwise after the date thereof. Now, I would like to hand the call over to Scott Shaw, President and CEO of Lincoln Educational Services. Scott, please go ahead.

Thanks, Michael and good morning, everyone. Today, we reported strong second quarter results as revenue from Campus operations grew nearly 10% over last year. Student starts increased approximately 18% and net income more than tripled. We also achieved a significant milestone as we completed the sale of our Nashville campus which generated net cash proceeds of $33 million. At quarter end, we remained debt-free and had approximately $95 million in cash and short-term securities. Despite continued historically low unemployment, our strategy to prepare an increasing number of students for productive, rewarding and essential careers while helping American corporations close their skills gap is clearly working. The combination of our hybrid teaching model, marketing programs, centralization of our financial aid process are all assisting in increased student starts, rising placement rates and enhancing returns to our shareholders. Furthermore, we continue to make good progress with replicating high in-demand programs to existing campuses and expanding our footprint with our new Atlanta campus. Both of these initiatives will provide additional growth in 2024 and beyond. Our performance during the first half of 2023 enables us to now revise upwards several guidance metrics which Brian will review in a few minutes. This positions Lincoln for an even stronger performance in 2024 and positions us well for our 2025 goals. The rollout of our hybrid teaching model is progressing as planned and will help us become more scalable and efficient once fully in place in 2025. As we've discussed with you in the past, the model combines hands-on learning at campus facilities while delivering a greater component of classroom work through online instruction. It enables our students to work part-time or manage other commitments while they pursue their Lincoln education and is specifically designed to help a higher percentage of students to graduate. The model also standardizes our programs across campuses with on-campus time slots of morning, afternoon and evening courses and with consistent start dates that provide greater flexibility, efficiency and overall capacity at our existing campuses. The rollout of our hybrid model at most campuses, coupled with adding existing proven programs at select campuses position us to drive higher campus and company profitability in the long term. Another key component to our growth strategy is the centralization of our financial aid process. During the second quarter, we believe improvements we have made with our centralization effort contributed to our student start growth rate and we just moved the last group of schools to the new software platform several weeks ago. We have analyzed the data from schools that were transitioned earlier this year and clearly, we are seeing an improvement in a number of areas. For instance, the new process has reduced the number of days it takes to package an applicant's financial aid. This improved efficiency helps the student know as quickly as possible how they can pay for their education and helps us convert a lead generated to our marketing programs into a start. While the full rollout of this process will take through the end of the year, we do expect to see continued gradual contributions from this effort during the second half. Another key component of our growth strategy includes opening 10 new program replications across our existing campuses by the first quarter of 2025. These programs are focused on preparing students for rewarding careers in electrical, HVAC, welding, automotive and medical assisting which are some of our most successful and in-demand programs. The replication model provides Lincoln with substantial organic growth opportunities through the fastest and highest return on investment as we leverage our existing infrastructure, campus management and market knowledge. We continue to anticipate that these 10 new programs will reach their full run rate after approximately 3 years of operation, at which time, each is expected to provide an average of $1 million in added profitability annually. We did plan to open 3 replication programs by the end of the current year. However, staffing issues at local government and regulatory agencies are delaying the start-up of these programs by 3 to 5 months and we now see these additions getting underway in the first quarter of 2024 which should enhance next year's start growth. During the quarter, we actively implemented the new campus component to our growth strategy. We continue to build out the new Atlanta campus and remain on track to enroll our first student at the facility during the first quarter of next year. With the sale of our Nashville campus complete, we now are aggressively moving to secure a new site in that market and hope to have an agreement in place by the end of the year. Meanwhile, we continue to fully operate at the existing campus. In addition to the Nashville campus, our goal is to open 1 new campus a year over the next 5 years. And based on an ongoing site selection and negotiations, we are fully confident of achieving that objective. Our efforts to broaden existing corporate partnerships while adding new ones continue to make steady progress. During the quarter, we announced a new collaboration with Hunter Engineering, a leading name in the undercar service industry. Later this summer, our Denver campus will become the latest site to house a Hunter training center where students can train directly on patented Hunter equipment. Local repair shops will also have the opportunity to send technicians to the Lincoln campus to train on the Hunter equipment. In addition, we recently opened our second Tesla training program at our Columbia, Maryland campus and Tesla has asked us to help with securing additional locations. We marked the 25th graduating class from our long-standing Hussmann partnership which provides qualified Lincoln Tech HVAC graduates with free advanced level training and a career with Hussmann all over the United States. Discussions are ongoing with our current OEM partners to expand to other campuses as well as new corporate partners. We've had a strong first half of 2023 and our team is executing quite well. We achieved a 1.5% increase in our start rate during the second quarter which we attribute to the increased number of leads being generated by our marketing programs, the more efficient financial aid packaging that is emerging from the centralization effort and the timing of starts under the hybrid teaching model. These 3 factors combined to positively impact both high school graduate starts as well as adult student starts during the quarter. We do expect our student start growth rate to slow during the second half of the year simply because the implementation of our hybrid model means we have fewer start dates in July compared to the prior year. In addition, with the opening of the 3 programs at existing campuses now moving to the first quarter of next year, we won't have those starts in the second half of this year. The net impact is that we do expect to finish the full year with 6% to 10% student start growth and Brian will provide some more color on this metric during his remarks. Overall, we believe our strategies have put Lincoln in a position to consistently grow. The interest in our programs is quite strong and employers continue to have a dire need for trained employees. At the same time, prospective students are looking for alternatives to 4-year college. Our strong graduation and placement rates provide excellent reference points our balance sheet which has never been stronger, is enabling Lincoln to expand our programs and locations which will create long-lasting benefits to our students, our graduates, our instructors, our corporate partners and increasing returns to our shareholders. Finally, our momentum has been gaining increased recognition in recent weeks. A particular note for today's call was our inclusion in the broad market Russell 3000 Index on June 26. The inclusion meant that Lincoln was also included in the Russell 2000 Index. Combined, these milestones have created additional demand for Lincoln shares from indexed investors and served to increase awareness of our company by institutional investors. I'm also proud to report that our Marietta, Georgia campus was named a School of Distinction by our accrediting body, ACCSC. Every 3 to 5 years, schools are reaccredited and only a handful of them receive this recognition. I'm very pleased with our organization's performance at every level and I continue to believe that we are poised for even greater success as we truly make a difference in helping our country address its skills gap. Now, I'd like to ask Brian to provide his review of our second quarter financial results and our updated guidance. Brian?

Thanks, Scott. Good morning and thank you for joining our second quarter earnings call. I am pleased to report our solid financial results and highlight recent developments that continue to advance our strategic growth initiatives. Before we turn to the operating results, we completed the sale of our Nashville, Tennessee campus property for net proceeds of $33.3 million. This sale resulted in a gain of $30.9 million and a non-cash impairment charge of $4.2 million related to the goodwill and long-lived assets of the Nashville campus. To ensure campus operations remain uninterrupted for our students, we entered into a leaseback agreement for an 18-month period to provide for the relocation to a more modern and efficient facility within the Nashville market. The initial 15 months of this lease is rent free, meaning there are no cash payments due. However, for accounting purpose, we record the fair value of the free rent as a $2.3 million prepaid asset which will be amortized monthly as non-cash rent expense. The sale proceeds, along with our cash flow from operations, boosted our ending cash balance to $95 million at quarter end, exceeding our previously disclosed estimate of $85 million. Our cash position is one highlight of our strong balance sheet and financial position as we're debt-free and net working capital of nearly $70 million. Besides working capital needs, we expect to utilize the cash to fund current and future growth initiatives, including the build-out cost of the new Nashville campus which is expected to range between $15 million to $20 million in CapEx. The build-out includes additions of 2 of Lincoln's in-demand programs, HVAC and Electrical which will be new offerings at this campus. Our capital expenses during the second quarter were $7.6 million which included the ongoing build-out of our new Atlanta campus and the expansion and addition of new programs at existing campuses. During the quarter, we also incurred $300,000 of expenses related to the opening of the Atlantic campus. We continue to explore additional expansions and new campus growth opportunities which we anticipate funding with cash on hand. We have invested a significant amount of our total cash balances in low-risk market securities, including treasury bills. These investments yielded $0.5 million in interest income during the second quarter. Now, turning to our financial results. Unless otherwise noted, all comparisons exclude the Somerville campus that is being closed this year and included in our Transitional segment and the preopening expenses of our new Atlanta campus. Revenue increased 9.8% or $7.9 million to $88.2 million. Higher revenues were achieved due to: one, an 8.6% increase in average revenue per student; and two, our strong 17.9% increase in student starts in the quarter. Revenue per student increased in part due to tuition increases and the transition to our hybrid teaching model which increases program efficiencies and delivers accelerated revenue recognition, particularly in our evening programs. Another contributing factor was a higher tool revenue related to increased starts in the quarter which led us to finish the quarter with a higher population than last year, driving future revenue growth. Our robust student start growth was aided by marketing investments, emissions initiatives and the progress we continue to make with our centralization of financial aid which slightly increased our enrollment to start rate. Operating expenses were $88 million, in line with our expectations when adjusted for the Nashville sale items and the other non-recurring items detailed in our adjusted EBITDA calculation reflected in our Q2 earnings release. As we have previously communicated, while the implementation of our hybrid learning and centralized financial will drive future efficiencies, we are incurring duplicate expenses this year related to both projects. Adjusted EBITDA was $2.4 million, after excluding non-recurring items detailed in our Q2 earnings release. This was slightly higher than last year's $2.3 million and ahead of our expectations going into the year. Our financial results for the 6 months were ahead of our internal plan and provide a strong foundation as we enter the second half of the year. We're excited to have the resources to enable us to continue to improve our processes and services for our students, while developing new growth opportunities. Turning to the cash flow; we generated over $10 million in cash flow from operations in the quarter. We invested $7.6 million in capital expenditures, largely related to growth initiatives. We also had some activity under our share repurchase plan. In the second quarter, we repurchased 61,000 shares at an average price of $5.49. In total, since May 2022, we repurchased 1.7 million shares for $10.3 million. Lastly, I'll provide some details on our revised outlook for the full year. Our strong start growth in the second quarter resulted in a 12.5% start growth for the first half of the year. We anticipate start growth in the second half of the year will be lower with second half starts slightly above prior year. As Scott mentioned during his comments, we attribute this outlook mainly due to the timing of start dates and new program rollout. Under our new hybrid teaching model, we no longer have significant start dates in July which we had in prior years. As a result, we benefited as some students elected to accelerate their start dates to Q2 from Q3. In addition, we are experiencing delays in the rollout of certain new programs at existing campuses that will lead to a shift of approximately 150 starts, we originally expected in 2023 to 2024. Despite the shift of some starts and program delays, we still anticipate start growth for the balance of the year. In total, our strong performance in the first half allows us to refine our outlook for full year starts. We're making an upward revision to our financial guidance which we previously updated after Q1. Our full year guidance is now the following: Revenue in the range of $360 million to $370 million, adjusted EBITDA in the range of $22 million to $26 million, adjusted net income in the range of $10 million to $13 million, student starts growth of 6% to 10%. As our investments in the Atlanta campus and other growth initiatives will accelerate in the second half of the year, our projection for capital expenditures remains unchanged at $35 million to $40 million. In terms of stock-based compensation, we now forecast it to be $5 million for the full year based on our improved performance and outlook. Accordingly, we anticipate $1.6 million of expense recognized evenly in the second half of the year. In conclusion, our results and outlook for the balance of 2023 reflect the growing demand of our programs and continued progress on our key initiatives for the year. I'd like to thank our entire team for their efforts and contribution in delivering another strong performance this past quarter while continuing to position Lincoln for growth in the second half of the year and beyond. We look forward to communicating our progress following the third quarter. And now I'll turn the call back over to the operator so we can take your questions. Operator?

[Operator Instructions] Our first question comes from Alex Paris with Barrington Research.

Congratulations on the quarter and getting the Nashville campus sale closed.

Thanks, Alex.

Point of clarification before my question. I missed it, Scott, when you were talking about the replication model. What were we expecting in terms of new student -- sorry, new program replications this year? And what will we have as a result of the delays in the personnel and the regulatory offices?

Sure. As Brian mentioned, there are about 150 starts that are moving to next year which were 3 programs really at our Lincoln Rhode Island campus that are being delayed simply because of timing of getting building permits and things of that nature executed. So it's still on track. Well, it's still going to open just about a quarter later than we had anticipated. So that's kind of as far as program replications, that's kind of the major change going forward.

I think you launched two in the first quarter, medical assisting and electrical. Did you launch any in the second quarter? And then, how many in the second half do we anticipate given this change at Lincoln Rhode Island.

Sure. Yes. Brian has a list of those...

Yes. So we're launching -- the timing, I'll have to get back to you on. So there's -- I would say there's 5 that we're launching but some are program expansions like we have 2 welding programs that we're expanding but there will be about 5 that we're launching this year that will have starts.

So to be clear, we're expanding -- which we don't normally -- we don't count these but we did expand 2 of our welding programs, simply because we have such good demand for those 2 markets. And then we have a medical assisting program at Columbia, Maryland that is about to open. And we have an opportunity potentially for electrical program possibly could open in the fourth quarter which would actually be ahead of schedule.

Right. So in summary, I guess there's 4, there's 2 medical assisting and possibly 2 welding expansion. So as we said, 150 are moving into Q -- into 2024. So there's about 300 that was budgeted, about 150, we're projecting to take place during 2023 and another 150 moving to 2024.

Great. And then you expect a number of replications next year as well, right?

Correct. Yes. We should have a good lineup of activity at the end to get us to that number [ph].

Yes. Then my last question before hopping in the queue would be starts growth. Starts growth was very impressive again. And driven by -- in terms of programs driven by Transportation and Skilled Trades up 18.6% in the quarter and then the Healthcare and Other Professions up 6.5%. What's driving Transportation and Skilled Trades over Healthcare and Other Professions year-to-date?

Well, I think that actually both are doing quite well and some of its just timing of when starts occur. But overall, what is so encouraging is the fact that we have this low unemployment rate and yet we're seeing strong demand which, to me, is just -- I think people, I guess, read the papers more than I thought. People are understanding that there are great opportunities out there for the trades, you can get an education without spending 4 years and accumulating a lot of debt. And I think that, that message is resonating with more people and the programs that we're offering are ones that are just the opportunities. We just have more employers coming to us than we have graduates and that maybe is also getting out there in the marketplace that these are good long-term opportunities in their real careers that can give you a solid opportunity. So we are doing well with our marketing. I can't take that away from my marketing team. We seem to be attracting and getting stronger acceptance and stronger lead flow than we had counted on, to be honest. So part of it has to be market, part of it has to be what our team is doing to access the market.

And as Scott mentioned, we are having a slight pickup because not -- many programs now do not have a start in July. So some of those students elected to come in, in June. So there was a slight pickup from that as well.

Our next question comes from Steven Frankel with Rosenblatt Securities.

I'm wondering if you could maybe give us some help on how much was the streamlining financial aid and factor in starts, maybe how many points you'd say the start growth was -- contributed from that.

Yes. I wish I could do that scientifically for you. I can't break it out as to what percent is. All I can tell you, Steven, is with the process that we've put in place, we've refined it and I'll say it this way, we have a process that we're calling financially aid packaging on demand. which is -- the metric I can tell you is that the number of days to get someone packaged at those campuses that are implementing that approach is much less than what it was. And the reason why we implemented the approach was because we know that the sooner students know how they can pay for their education, the more likely it is that they're going to start. So parsing it out and determining exactly what -- how many basis points of improvement is due to that, I don't know. But that's why we went after that strategy and we're getting results. So I can definitely attribute some of that improvement to that but there could be obviously other factors as well.

How much room is there for further improvement in revenue per head in the back half?

So as I mentioned, for our -- what we call our hybrid learning model, we did launch it in the second half of last year. So where most of that pickup is in the night program where we shrunk it from 24 months down to 12 months. So since we did have some start last year in the second half of the year from that, it would be -- it will start tapering a little bit, some of it going forward. But the good news is when we finished the quarter with more students. So that's also going to contribute to our future revenue growth.

And then I'll sneak in one more here. What's the trend in cost per lead? Are you seeing a friendlier advertising environment [indiscernible] the year?

We are. I mean, our -- when you look at our total cost per start in marketing, we're actually down for the first 6 months compared to last year. Now part of that is because of improved performance with the start rate but we're not seeing or experiencing as much price inflation on our leads as we were last year. That's for sure.

Our next question comes from Eric Martinuzzi with Lake Street Capital Markets.

I wanted to dive in on the revenue growth versus the growth in your educational services and facilities expense. We had revenue up 10% and the educational services and facilities expense was up 11%. Wondering if -- are there onetime items in there? Just looking for points of leverage here going forward?

Right. So there are onetime items in both our 2 key initiatives. One is our hybrid model that we're still teaching out the old program while we're teaching a new program. So there's some costs associated with that as well. As well as there was in financial aid as we're still transitioning, we still have many students --, many advisers at the school as well as corporate right now. We're still transitioning what we call, I'll say, reentries to be centralized and a few other areas. So as we're doing that, there's some additional cost in financially as well. But the one thing I would look at, there were some onetime items as well in our earnings release that we talked about that contributed to the -- that overage.

Okay. And then I know you talked about the end of 2025 for the full transition to hybrid. Remind me again, when is the financial aid consolidation [indiscernible] centralization.

Yes. Financial aid will be wrapped up by the end of this year as far as the fact that everyone will be on the new platform and will be staffed accordingly for delivering on this new platform; so by the end of this year.

Got you. All right. And then the cash balance looks terrific. I know we're setting aside $15 million to $20 million of that -- $90 what was the number -- $96 million or so. What else uses of cash, it looks like you bought a little bit of stock but just curious to know if there's -- if it's pointed more towards acquisition opportunities, program investments, or share repurchases?

Well, hopefully, depending on the stock price, we'll still support the stock. But a lot of it is due to our guidance is $35 million to $40 million in capital expenditures for the first 6 half -- first 6 months of the year, we only spent $11 million. So it is going to ramp up. Our Atlanta campus is going to be spending in the neighborhood of about maybe another $9 million from now until the end of the year as well as new programs is probably going to be another $10 million as well. So a lot of that is, I'll call, our initiatives -- our growth initiatives we'll be spending a lot of it on.

[Operator Instructions] Our next question comes from Raj Sharma with B. Riley.

Congratulations on really good results for Q2. Could you just explain a little bit more on the composition of the starts and the starts -- they're higher year-on-year significantly across nationally sort of the same trend and also young adults, high schoolers, kind of composition and...

Yes, sure. Thanks, Raj. Yes, so we're seeing growth, as you just mentioned, kind of across the board in every state that we operate in. There's a little bit stronger growth on programs around skilled trades in automotive than in health care. But as you know, that can fluctuate quarter-to-quarter. As far as the growth -- as far as the makeup, I would say that for us, high schools for the first 6 months are about flat, frankly, with last year but it's really in the adult market which is somewhat counterintuitive again, given the low unemployment rate but it's really on the adult side that we're seeing stronger growth than we had forecasted.

And nationally, too, you have the same sort of increased trends? Or is there some areas that are doing better?

No, there really isn't any geography that tends to be better than the other. I mean, it seems to be really very, very broad.

And the good news is for Q2, all but two schools did have start growth; so majority of our schools that did have a nice start growth.

Right. And so you expect this interest despite like you pointed out, despite inflation still being somewhat elevated and higher costs. Do you expect the interest in programs from the adults, young adults? And despite tight labor markets, you were expecting and seeing that to continue, I mean, other than the 150 starts that you say got pushed out to Q1.

Yes. I can tell you that our activity in the month of July from a lead perspective has not waned from what was happening before. So yes, we do expect it to continue. Again, I do believe that there is probably a shift out there that -- and certainly, you can look at the numbers of enrollments at community colleges and others, people are making decisions. And it just takes a few people in any market to decide to go to our school versus go to community college for us to get a bit of a lift. We're not changing the world here drastically but we're getting really strong results because of it.

And the tuition increases, were they across the board as well or certain programs more so? And do you see that sort of [indiscernible] being taken really well? Or do you see more increases possibly potentially [ph]?

Yes, sure. Well, we never like to raise tuitions. Obviously, it does make it more challenging for students but at the same time, we can make sure that we're being prudent with our expenses. And certainly, last year, we saw the greatest increase that we've seen in a long time in many cost items. So we did raise tuitions starting in January, slightly higher. We typically were, let's say, 2% to 3%. This year, we're closer to 5% and some of that was targeted more towards our nursing programs, where we saw higher amounts of certainly salary increases for nurses. So we don't anticipate that, that is going to continue going forward but where it makes sense and where we frankly need to, given the cost of delivering the education, we do -- well, I should say, we will raise the tuition as modestly as possible.

Great. And if I can just sneak in one more. On -- I think an earlier caller had mentioned on tuck-in. Do you see possibility potential of tuck-in opportunities? I mean.

I apologize. Could you repeat that?

Yes. I just -- I'm saying, do you see potential tuck-in acquisitions? Are you looking at them as the environment is sort of conducive.

Yes. So we continue to look at acquisitions, frankly, of all sizes, tuck-in or even larger. A lot of it all comes down to valuation; a, I've seen that it seems like lots of the values still remain, I'll say, higher than I would like. But at the same time, there's always something new that's coming out on to the marketplace. And we'll just continue to evaluate and make the best judgment at the time when there's the right opportunity for us.

Our next question comes from Bob Puopolo with Epic Partners.

Regarding to --with the move to more the hybrid educational delivery; are you at all concerned and what steps are you taking as it relates to outcomes, distance education sort of reasonably demonstrated during the pandemic to be suboptimal? And are you concerned about graduation rates and placement rates and what you're doing -- sort of doing to enhance those?

Yes. No, it's a good question. Well, first of all, we're always concerned about our graduation and placement rates. And just to reiterate, we have a goal of getting the 70% graduation rate and 85% placement rate and we're about 1 or 2 percentage points from that target. We are implementing a lot of change with regards to our delivery of our education as well as making enhancements to our programs. And just to remind you, when we say blended, it's about 25% to maybe 30% of the program that's online and we are a hands-on institution. That's what we specialize in and that's what our students like and none of that's been cut back at all but there are theories and things that you do need to learn. So always our programs were about 50% didactic and 50% hands-on. And what we've done is taken about half of that the theory part and put that online, where we believe, frankly, we can create, I'll say, a better unified experience with videos and more consistent delivery of those theories but we're not in any way cutting back at all. In fact, we are looking at enhancing with new teaching techniques and new teaching models and new teaching equipment as it comes out, so that when the students do come to our campuses, it's going to be hopefully even more engaging for them than it was previously. And to date, as we've looked at comparing our retention of students in the new model versus the old model, we are not seeing a degradation, so that's reassuring to me. But with that said, we are constantly monitoring that.

That concludes the question-and-answer session. At this time, I would like to turn it back to Scott Shaw for closing remarks.

Great. Thank you all for joining us today. And as you can see from our performance, we are making great progress and remain very excited by our numerous opportunities for continued growth. I'd be remiss for not thanking and acknowledging all of our employees for their dedication and commitment to our students. We change people's lives and everyone at our campuses takes this responsibility very seriously. Students come to Lincoln Tech to put their potential to work and we look forward to helping each and everyone strive for that goal. Thank you again and we look forward to updating you on our progress this fall. I hope you all have a wonderful rest of your summer. So, long for now. Bye-bye.