LINC - NASDAQ

Good day, and thank you for standing by. Welcome to the Third Quarter 2024 Lincoln Educational Services Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speakers’ presentation, there will be a question-and-answer session. [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, Michelle. Good morning, everyone. Before the market opened today, Lincoln Educational Services issued a news release reporting financial results and recent corporate developments for the third quarter and nine months ended September 30, 2024. 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. 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. The company cautions you that these statements reflect certain 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 and may influence the accuracy of the statement and projection upon which the segmented 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 statement, whether as a result of new information, future events or otherwise after the date thereof. One other housekeeping matter. During the Q&A portion of the call today, we would appreciate if questioners limit themselves to two questions and then re-queue to ask any additional questions. In advance, we thank you for your cooperation. Now, I'd like to turn the call over to Scott Shaw, President and CEO of Lincoln Educational Services. Scott, please go ahead.

Thank you, Michael, and good morning, everyone. Thank you for joining us today for our review of an exceptionally productive third quarter at Lincoln. Before I begin, I want to acknowledge today's date, Veterans Day, and extend our appreciation and gratitude for those who have, to those who continue to serve in our armed forces. Lincoln Tech was founded by a veteran to help serve his fellow veterans acquire skills to reenter the workforce. We are proud to have graduated thousands of veterans of the US armed forces. And assisting servicemen, women and their families remains at the core of our mission, as they have since our founding in 1946. Led by our double-digit student start and revenue growth, our third quarter financial results built on the strong momentum generated during the first half of the year. During the quarter, we continued to execute our key growth initiatives, including new campus development and program replication openings at existing campuses. We also neared completion of the first phase rollout of our Lincoln 10.0 hybrid teaching model, while laying the groundwork to begin implementing the platform at our nursing programs. We signed new corporate partnerships and expanded numerous existing ones, achieved 67% adjusted EBITDA growth and increased cash flow from operations. When combined with current trends, our results and progress have led to an increase in our guidance for the full year 2024, while increasing our confidence of continued growth in 2025. Brian will share more in his remarks. I've mentioned during previous calls how Lincoln is capitalizing on the nation's growing interest in skilled trades training as an alternative to the traditional four-year college education. During the third quarter, we saw more and more examples of this trend in media coverage and political leader discussion. Our marketing programs have become increasingly effective over the past year at capturing potential student interest in Lincoln, and during the third quarter, generated robust student lead levels, exceeding our internal forecasts. We continue to successfully convert these leads to starts. And in the third quarter, student starts at campuses operating for more than a year grew 15%. When you add the third quarter starts at our new East Point campus, overall student starts grew an impressive 21%. The Lincoln 10.0 hybrid teaching model is proving to be a leading generator of interest in our programs, while at the same time, providing increased flexibility to our students who often need to balance work and life, while earning their certificate or degree. We ended the quarter with more than a 13% increase in student population over last year and a 10% increase in this growth metric over the second quarter, which is a highly positive operating trend for our company. We will complete the first major phase of the rollout of Lincoln 10.0 by the end of this year. At that time, the platform will be used to teach approximately 65% of our students. The success of 10.0 is truly transformational for Lincoln, our students and instructors. It enhances the student experience, enhances our instructors' ability to teach and increases our operating efficiencies. We believe Lincoln 10.0 has contributed to our start growth and strong corporate partnership activity, and we are now ready to expand its deployment to more of our students. In the third quarter, we decided to adopt the 10.0 hybrid teaching model approach for our nursing programs. The implementation should be completed by the middle of 2026. And when it is fully deployed, our transformational hybrid teaching model will serve approximately 80% of our total student population. We are very excited about the potential benefits Lincoln 10.0 will bring to our nursing programs, including reducing commutes for both students and instructors and increasing capacity to enable us to serve even more future nurses. Additionally, we expect to realize improved operating efficiencies, and thus, operating margins from these programs, which have tended to be lesser contributors to our financial performance as compared to our skilled trades programs. The success and scalability of Lincoln 10.0 has been a major factor behind the early outperformance of our new East Point campus in Metropolitan Atlanta. For instance, after two quarters of operations, East Point has enrolled 600 students and generated $5 million in revenue, results that exceeded our internal plan. Furthermore, during the third quarter, East Point generated positive EBITDA, which again outperformed our expectations. To date, our student start costs at East Point are significantly below our corporate average, and the campus has exceeded our original expectations. These early results have given us even more confidence about the potential returns from our investments in new campuses. Currently, we are well into the construction of three campuses, which will open in 2025. We are relocating the Nashville and Philadelphia campuses, which will have the look and feel of our East Point campus and will offer additional skilled trades programs. We expect to begin transferring students from the old campus in Nashville to the new one during the first half of 2025. Levittown, our new Philadelphia campus, is currently scheduled to open in the third quarter of 2025, and our latest new campus in Houston is expected to open by the end of 2025. I'm pleased to announce that we are in what we believe are the final stages of negotiations for the leasing of a brand-new facility serving the metropolitan New York City area. Already have a campus in Whitestone, Queens, but this new campus will be on Long Island. We have a partnership with the Greater New York Dealers Association, and we know that there is strong demand for technicians on Long Island. Also, since we added our electrical program several years ago to our Queens, New York campus, we know that there is strong demand and need for the skilled trades in this region. This campus is targeted for opening in late 2026 and will offer automotive, welding, HVAC and electrical. We will feature the same state-of-the-art technology and teaching tools that we are deploying in East Point and the other new campuses. We expect to be teaching all students at these new campuses through the Lincoln 10.0 hybrid teaching platform, thus realizing the same level of operating efficiencies we are experiencing in East Point. Automotive classes at the new Metro New York campus will utilize the Electude curriculum and integrated training equipment that has been such a hit at the East Point campus. The cloud-based e-learning platform is the global leader in automotive training in high schools and colleges, and Lincoln is currently the only school group in the United States to offer its full capabilities and benefits. Electude allows our instructors access to interactive and engaging foundational lessons, gamified formative and summative assessments, teaching resources, tools to build their own curriculum, analytical tools to identify learners' needs and coursework in multiple languages. Moreover, their proprietary trainers seamlessly integrate with our curriculum and provide students with a clear understanding of all the major systems in a car. The technology utilizes the principle of discovery learning, which is how younger generations have become so adept in mastering today's applications. We have been so pleased with the results at East Point. We are expanding its deployment to all of our automotive programs throughout the country. Another key component of our growth strategy is replicating 10 programs at existing campuses by the end of the first quarter of 2025. During the third quarter, we opened HVAC programs at our Morristown and Shelton campus and expanded welding at our Melrose Park campus. During the fourth quarter, we're on track to open additional welding booths in Denver, a new HVAC program in Indianapolis, and an electrical program in Morristown. The programs opened to date have generated strong interest with both students and employers. In keeping with the national trend toward alternatives to four year college education, we're also finding new interest in these programs from high school guidance counselors in the respective markets. We continue to expect these programs to generate an additional $1 million each in profitability by the third year of operation. The success of this effort to date has led to our team examining other opportunities to replicate successful high-return programs at existing campuses as we move into the second half of 2025. Corporate partnerships continue to be an important driver to our growth. And in late October, we announced two new employer-specific training programs with Hyundai Motor of America and Genesis Motor of America. The programs supplement Lincoln's automotive service technology programs across America and help students build skills on Hyundai Genesis equipment and systems, while helping the employer build its technician workforce. Both are employer-funded, meaning our students will have no additional expense to pursue this supplemental training. In addition, we recently finalized terms to open our third Tesla training center at our Melrose Park, Illinois campus. Meanwhile, our five-year workforce development agreement with Container Maintenance Corporation has made strong progress over the summer and fall and has started training CMC employees at the company's CMC's Charleston, South Carolina facility. This partnership represented a new scale and level for Lincoln by leveraging our curriculum and training resources to upskill CMC employees at its facilities. Over the five years, the agreement is expected to generate approximately $6 million in revenue to Lincoln. Several other corporate partners have recently extended our working relationship in some cases, for up to five years, illustrating the continued pressures employers have to fill their skills gap, as well as their satisfaction with the results generated from partnering with Lincoln. Meanwhile, discussions with potential new partners are quite active. With our outperforming student start growth, our expense spending has been higher. But we continue to see progress in operating efficiencies, driven largely by Lincoln 10.0. Educational services and facilities expense is down as a percentage of revenue, and we are generating higher returns from our marketing investments. We believe we are making progress to enhance operating leverage across our system, and the application of Lincoln 10.0 to our nursing programs should be a significant contributor in the future. Overall, we remain on track to deliver our 2027 adjusted EBITDA objective laid out earlier this year and are increasing our net income guidance for this year, as Brian will review in a moment. One month into the fourth quarter, we continue to experience strong indications of interest from our employers and students. Looking ahead to 2025 and beyond, we are very well positioned to continue our growth trends as we layer on new campuses and new programs at existing campuses, while continuing to drive efficiencies across our system. Lincoln 10.0 will be a key driver to these operating efficiencies, as will multiple campuses in the same region, which we are experiencing in Atlanta, Metropolitan New York and New Jersey. Now that the election is behind us, we look forward to working with the incoming administration to better serve all students and create a more level playing field among institutions. Given the high cost of higher education at all levels, it's imperative that students have accurate information about the likely outcomes for their area of study. At Lincoln Tech, we are committed to providing only high ROI programs that benefit students, their families and their communities, and we continue to work to be a leading voice for middle skills learning in this country. The opportunities for Lincoln have never been greater. Employers continue to struggle to find technicians, electricians, welders and healthcare workers. Lincoln Tech trains the essential workers that allow us to live our lives in the manner to which we have grown accustomed. We see the need for what we do growing regardless of macroeconomic conditions or political agendas and have transformed our company into an exceptional provider of educational services, meeting the needs of America's corporations, as well as America's workforce. Finally, I'd like to note, I'll be meeting with investors over the coming weeks at various locations around the country. On November 21st, I will be in Dallas at the IDEAS Conference and with Lake Street in San Francisco and Denver on December 10th and 11th. In addition, I will be with investors with Barrington in New York City on December 17 to educate investors about the enhanced valuation potential offered through our shares. Now, I'll turn the call over to Brian Meyers, so he can review some of our recent financial highlights and guidance. Brian?

Thank you, Scott, and good morning, everyone. Thank you for joining our third quarter earning [Technical Difficulty] our financial results, I too would like to take a moment to honor Veterans Day and express our gratitude to all our students, instructors and alumni who served and continue to serve in the armed forces. Today, I will cover highlights of our financial performance, provide an update on key growth initiatives and review our raised guidance for 2024. In terms of campus performance, as Scott mentioned, the new East Point, Georgia campus has delivered strong operational and financial performance since its opening in March of 2024. East Point's financial results during its first seven months of operations exceeded our initial internal plan by a wide margin. As a result, we are pleased to report that the campus achieved positive EBITDA for the third quarter. With the campus now profitable, the financial results for the campus are no longer included as an adjustment in our adjusted EBITDA calculation beginning with this third quarter. Moreover, the campus is projected to continue to be profitable in the fourth quarter, further contributing to our overall growth and financial stability. The success of the new East Point campus strengthens our confidence in our growth strategy and strong return on investment. Building on this momentum, and as Scott outlined, we are excited about the upcoming relocation of our Nashville campus, followed by the anticipated relocation of our Levittown and the opening of our Houston in the latter half of 2025. While each of these projects represent a significant investment with total capital expenditures of around $75 million between 2024 and 2025, we are confident that we can achieve similar results to those at our East Point campus, driving our long-term growth trajectory. Turning to our strong financial performance in the third quarter, total revenue for the quarter was $114.4 million, reflecting an increase of nearly 15% or $15 million. This growth was primarily driven by a 10.6% increase in average population, fueled by our double-digit start growth over the last four consecutive quarters. For additional context, Lincoln has now achieved start growth for eight straight quarters, starting with the fourth quarter of 2022. As a side note, the new East Point, Georgia campus contributed $3.4 million to this incremental revenue for the quarter. Our starts for the third quarter significantly outperformed prior year, increasing by 21.1%. We ended the quarter with 1,800 more students than last year's third quarter, positioning us well for continued revenue growth in the fourth quarter. While the overall 21% growth includes the new East Point, Georgia campus, same-campus start growth remained strong at over 15%, highlighting the sustained growth across our existing locations. In terms of operating expenses, and overall operating expenses were $108.6 million compared to $97.6 million last year. The 11% overall increase is a result of our 10.6% growth in average student population, a $1.5 million increase in depreciation as a result of higher level of capital investments, and a number of onetime items, mainly related to growth initiatives. While we increased our marketing investments compared to prior year, our cost per start has declined, demonstrating efficiencies in our marketing spend. Our operating expenses were in line with our internal expectations. And education, services and facility expense as a percentage of revenue have begun to decline as we experienced efficiencies and benefits from a higher population and our hybrid teaching model. Adjusted EBITDA was $10.2 million for the third quarter compared to $6.1 million in the prior year, representing a 67% increase. On a year-to-date basis, we have generated $23.1 million of adjusted EBITDA compared to $10.8 million last year, a 114% increase. Our balance sheet remains strong with total liquidity exceeding $90 million with cash and cash equivalents of $54 million. Also, we continue to be debt free and ended the quarter with working capital of $42 million. During the third quarter, we generated cash from operations of $5.6 million compared to cash used of $6.8 million in the prior year. Our CapEx was about $20 million, mainly related to the new campus initiatives discussed earlier, plus the build-out of 10 programs, which consist of program replications and program expansions. Over the course of the third quarter, we successfully launched three programs with plans to roll out three additional programs in the fourth quarter and the remaining four programs in the first half of 2025. As a subsequent event note, the Board of Directors recently approved a strategic plan to divest our Euphoria Institute campus in Las Vegas, Nevada. This decision aligns with our broader strategic goals of optimizing resources and focusing on Lincoln's core programs. Given that this campus is Lincoln's only location offering cosmetology and aesthetic programs, which lie outside our core programs, we believe it is better positioned with a cosmetology-centered organization. The Euphoria campus had an EBITDA loss in 2023 and continues to underperform this year and forecasted to generate $7 million of revenue with an EBITDA loss of above $1 million. We are working with a potential buyer and expect to have a signed asset purchase agreement in place shortly and the closing to be completed early next year. In terms of accounting, as of year-end, we expect to report the net related assets as held for sale on the balance sheet and the operational results within the Transitional segment. Shifting to the outlook for the full year of 2024, based on the first nine months' strong financial performance and our growing student population, which exceeded 15,800 at the end of the quarter, combined with the current market demand, we feel confident in raising our total year guidance as follows. Revenue ranging between $430 million to $435 million, adjusted EBITDA in the range of $41 million to $43 million, adjusted net income ranging between $16 million and $18 million, student start growth of 13% to 15%, and capital expenditures ranging between $50 million to $55 million. As a reminder, our full year financial guidance for adjusted EBITDA and adjusted net income excludes the new East Point campus net operating losses incurred in the first two quarters before the campus became profitable, pre-opening costs related to new and relocating campuses, program expansions and non-cash stock-based compensation and one-time non-recurring items. Please note, we define new campus EBITDA adjustments as all pre-opening costs, plus quarterly net operating losses, if any, within the first four quarters after opening. In summary, we are very pleased with our performance to date and look forward to building on the success going into next year. We are constantly exploring new opportunities to expand and drive efficiencies. Our long-term vision and goal remains clear, to achieve revenue of approximately $550 million and adjusted EBITDA of about $90 million in 2027. We continue to demonstrate solid growth, both organically and through our growth initiatives. We begin -- and we believe we are well positioned to reach this target. As always, a special thank you to our entire Lincoln team for their dedication in delivering exceptional education to our students and creating shareholder value. At this time, I'll turn the call back over to the operator for any questions. Operator?

[Operator Instructions] Our first question is going to come from the line of Alex Paris with Barrington Research. Your line is open. Please go ahead.

Hi, guys. Thanks for taking my questions, and congratulations on the beat and raise.

Thanks, Alex.

All right. So my two questions are going to be as follows. I want to talk about new campuses and then program replications. New campuses, you kind of did a good job, overview -- providing an overview in the prepared comments. I'm curious about the announcement today, the Long Island campus plans. Maybe you can give us a little bit more color on that, how that came to pass and the regulatory framework within New York State.

Sure. So we're at the cusp of hopefully signing the lease for this new property. We started looking in Long Island just with the same methodology that we used in selecting the East Point campus location, also highlighted the need out in Long Island for another campus. And as I mentioned, we already have a partnership with the Greater New York Dealers Association. And so, they have many members out there on Long Island. And so, we've known for a long period of time that it's a long commute for those students to come to our Queens campus, and so there definitely was an untapped market. On top of that, just given where the skilled trades are and our ability to launch a new campus that's going to have welding, electrical and HVAC also was a very positive driver for us to select this location. So it's something that -- hopefully, the lease will be signed within the next coming weeks, if not sooner, and we hope to have the school up and running within 24 months.

Great. And then, related, is there any special concerns with regard to New York State regulation of for-profit post-secondary education that we should be aware of?

Well, there's always -- New York is a challenging state. If we were going into de novo, I'd have more concern. Since we have been operating a campus there for 20 years, I do feel like we have an established relationship. With that said, as you highlight properly, it can be a challenging state to operate in and move forward. My expectation, though, that it's just a matter of timing, not a matter of whether it will happen or not.

Got you. And then, still related, your decision to close the Euphoria Institute in Las Vegas, that's not a big surprise. That doesn't really fit with the transportation skilled trades and allied healthcare and nursing for that matter.

So I'll just jump right in, Alex. So, first of all, we're not closing it. It's going to have a new owner. As you just mentioned, it is a one-off. It's our only cosmetology program. It's not an area that we're looking to invest. And as we look to hone our program offering, we had this in the works for quite some time, trying to find the proper home for it. And we think that we've found someone, and we, again, hopefully, will be announcing very shortly the finalization of those plans. But they'll be able to work with a smaller organization that has other cosmetology schools, which I think will enable them to grow and prosper and be much more effective than being kind of an orphan school within the Lincoln system.

But beginning in Q4, it will be part of transition campus for P&L reporting.

Correct. And it will be held for sale on the balance sheet. And we're looking to close on this in Q1 of next year.

Great. I’ll go back into the queue and let a few other people ask questions. And maybe I’ll have a follow-up. Thank you.

Okay. Thanks, Alex.

Thank you. One moment for our next question. Our next question comes from the line of Eric Martinuzzi with Lake Street Capital Markets. Your line is open. Please go ahead.

Yeah. Size-wise, the new Long Island campus -- I think you said East Point is 56,000 square feet. What square footage are we looking at for Long Island?

Around 65,000, so a little bit larger than East Point.

Okay. All right. And then, for the -- you talked about lead gen being robust. Is this a -- do you feel like you're getting smarter at lead gen or that there's an increase in macro demand?

Well, certainly, if I talk to my marketing people, we're getting smarter at lead gen. But I think it's like anything in life. It's a combination. Definitely, there is just much more interest by people. So, that always helps. And we constantly are looking at every way we generate leads and are constantly evaluating the performance. So I think it's a bit of both. But I'd say probably the overall macro trend that's happening out there is definitely giving us a nice boost.

Got it. Thanks for taking my questions.

Yeah, no problem.

Thank you. One moment for our next question. Our next question is going to come from the line of Steven Frankel with Rosenblatt Securities. Your line is open. Please go ahead.

Good morning, thank you. Tremendous performance on the skilled trade side of the business. Healthcare, you had strong double-digit starts. But how should we think about the flattish population? Is this just a timing difference versus last year?

Yes. It's timing of some of the starts. Also, as you may know that our one campus in Paramus, New Jersey is below benchmark. And so, we had to stop enrolling some students for that program. Given its current performance, we expect it to go back above benchmark in 2025. I feel very good about that. But in the interim, that one campus -- that's one of the seven campuses that has nursing -- won't have starts. So, that will, I'll say, dampen some of the population. Populations are robust at the other campuses. So I'm not concerned there.

As well as one of our biggest declines on that side is that Euphoria campus as well.

Okay, great. That's helpful. Thank you That's all the questions I had.

No problem.

Thank you. [Operator Instructions] Our next question comes from the line of Raj Sharma with B. Riley. Your line is open. Please go ahead.

Yeah. Thank you for taking my questions again. Congratulations on solid results and the raised guidance.

Thanks, Raj.

Yeah. On lead levels, they are very strong, even despite unemployment rates are not that impacted yet. Is this -- can you talk a little bit about the general environment? What -- are you seeing this trend is looking to stay positive like this?

I definitely think so. We're definitely seeing very strong interest. And as you say, the fact is unemployment has not increased, and yet we're seeing growth in our leads almost as if it were a high unemployment environment. I believe that, that really speaks to what many have been noticing and talking about and we certainly reiterate the fact that people realize that college isn't for everyone. There are a lot of solid job opportunities out there. We are a faster, cheaper way to get into the workforce than pursuing a lot of these four-year degrees. And people, I think, in general, are looking to do something different. And as we say, all of our programs are essential workers. These are all jobs that people can feel good about. These are all jobs that require skills to be developed with your hands. These are all jobs that, frankly, AI is not going to take away. So we are in an area at the right time with the right programs in the right environment. So it's all moving very well for us.

Thank you for that. That was really helpful. And then, with the change in the administration and with the Trump win, traditionally, the party has been less onerous on you or on your industry, do you foresee any changes in regulation? Do you foresee any changes in your SG&A in terms of the outlays for -- outlays that you've been making in lobbying?

Yeah. Well, our lobbying efforts -- they're really education efforts -- will continue because as we know, administrations come and go. Certainly, in the last Trump administration, a lot of the rules and regulations became less onerous. So I would anticipate that, that's going to happen again. But we are doing everything geared around the long term regardless of who's in office. What we do hope could happen, though, in this administration is that a lot of the redundant and unnecessary rules and regulations are hopefully altered, and ideally, though, we want changes that are going to be more permanent. And at the end of the day, what we are looking for is simply a level playing field, give every student the opportunity to assess what is a good program, where they can get a good return on their investment, and we will happily compete with anyone. It's just a matter of not being on a level playing field. But overall, I think that this is going to be a good period for us because hopefully, the administration will have less burdensome regulations like the borrower defense for repayment. Certainly, if someone has been defrauded, they should be -- get their money back, but you just can't give people a blank check just to go after every school in the country just as you feel like you didn't get what was promised to you. So I think that there's hopefully going to be greater sensibility put into the rules and regulations. And certainly, on the margin, it has to be beneficial to us. But as to whether or not I can say it's going to cut $1 million of expense out, I definitely would not say that.

Got it. Again, thank you for answering my questions. Excellent results and congratulations again. I'll take it offline. Thanks.

Thanks, Raj.

[Operator Instructions] I'm showing no further questions at this time, and I would like to turn the conference back over to Scott Shaw for any closing remarks.

Thank you, operator, and thank you all for joining us today and hearing about our strong performance and healthy momentum. For over 78 years, Lincoln has delivered quality education and partnered with companies locally and nationally to develop a productive middle skills workforce. Our success is directly tied to the strength and commitment of our people. I take great pride in visiting our campuses and meeting with students, faculty, staff and employers. Their stories of transformation and success inspire all of us, and I could not be more appreciative of everything that they do. An inflection point has definitely occurred as more and more people are seeking a quick, cost-effective path to enter the workforce and develop skills that can serve them a lifetime. Lincoln Tech is ready and able to meet this growing demand. Our programs are proven and constantly being updated to meet current industry needs. Our instructors are world-class, both in their knowledge and desire to help students. Our balance sheet is strong, which will enable us to expand into new markets and continually reinvest in our facilities to remain the leader in each market we serve. We're excited by the future and where we are going, and I look forward to updating you in February. Until then, have a wonderful upcoming holiday season. And once again, thank you to all of our veterans for their sacrifice and commitment to this country. I hope you all have a wonderful day.