SKYW - NASDAQ

Ladies and gentlemen, thank you for standing by. My name is Abby, and I'll be your conference operator today. At this time, I would like to welcome everyone to the SkyWest, Inc. Fourth Quarter and Full Year 2024 Results Call. All lines have been placed on mute to prevent any background noise. After the speakers remarks, there will be a question-and-answer session. [Operator Instructions] Thank you. And I would now like to turn the conference over to Mr. Rob Simmons, Chief Financial Officer. You may begin.

Thanks, Abby, and thanks, everyone, for joining us on the call today. As Abby indicated, this is Rob Simmons, SkyWest's Chief Financial Officer. On the call with me today are Chip Childs, President and Chief Executive Officer; Wade Steel, Chief Commercial Officer; and Eric Woodward, Chief Accounting Officer. I'd like to start today by asking Eric to read the safe harbor. Then I will turn the time over to Chip for some comments. Following Chip, I will take us through the financial results, then Wade will discuss the fleet and related flying arrangements. Following Wade, we will have the customary Q&A session with our sell-side analysts. Eric?

Today's discussion contains forward-looking statements that represent our current beliefs, expectations and assumptions regarding future events and are subject to risks and uncertainties. We assume no obligation to update any forward-looking statement, whether as a result of new information, future events or otherwise. Actual results will likely vary and may vary materially from those anticipated, estimated or projected for a number of reasons. Some of the factors that may cause such differences are included in our most recent Form 10-K and other reports and filings with the Securities and Exchange Commission. And now I'll turn the call over to Chip.

Thank you, Rob and Eric. Good afternoon, everyone. Thank you for joining us on the call today. I want to start and acknowledge last night the unthinkable happened when a military aircraft collided with an American Eagle aircraft on approach to Washington's Reagan National Airport, claiming the lives of all on board. SkyWest has offered our resources and support to our colleagues at PSA and American and extended our deepest condolences to those involved and their loved ones. This is a tragedy for all of us in aviation, and we support our aviation and military colleagues throughout the industry who have been affected by this tragic event. As an airline, we invest hundreds of millions of dollars to safely fly thousands of flights each day. That investment includes in fleet, onboard system and technology, rigorous training programs and safety management systems that enable ongoing safe adaptation to our dynamic industry's challenges. The NTSB investigation will undoubtedly be extensive, and we stand ready to offer support needed to ensure safe airspace across the nation. Just this week, SkyWest was named one of Fortune's World's most Admired Companies for 2025. SkyWest is one of only three U.S. airlines and the only regional airline on the list. This honor is not remotely possible without the integrity and teamwork of our more than 14,000 professionals, and I'm humbled to be part of this outstanding team. During the fourth quarter, together, our people completed nearly 30,000 more flights than the same quarter last year, delivering 99.9% adjusted completion. As we continue our work to execute on our growth plan to first restore or bring new service to underserved communities, second, redeploy and fully utilize our existing fleet, and third, prepare to receive our upcoming deliveries of 16 new E175s between this year and next, our ability to maintain strong operating credibility remains a key differentiator for SkyWest. Today, SkyWest reported net income of $97 million or $2.34 per diluted share for the fourth quarter of 2024. We also reported net income of $323 million or $7.77 per diluted share for the 2024 year. We're also pleased to announce that during the fourth quarter, we reached a contract extension with American Airlines that allows for a total of 74 CRJ700s under agreement. This new multiyear agreement extends SkyWest's current American CRJ700 flying, along with our United and Delta CRJ550s and places nearly all of SkyWest CRJ700 aircraft under long-term agreements. Additionally, as we receive another 16 E-175s over the next couple of years, we will have 278 total by the end of 2026. We are proud to become the first carrier to operate the E-175 into Aspen in December. Our dual-class aircraft generated 87% of our block hour production during the fourth quarter and the ongoing strong demand and delivery book continues to position us for increased regional market share. Our overall pilot staffing balance and outlook continues to improve. We believe we are now in a place where our pilot staffing, hiring and production are well matched with a very robust pipeline. We are fully confident the measures we have put into place over the past 3 years will ensure staffing is stabilized over the long term. With this continued progress, we expect block hour production to be up about 12% this year compared to 2024. As we discussed last quarter, this places us near the pre-COVID utilization levels. We remain disciplined in our long-term strategy, and we'll continue to make smart investments in our people and fleet as we redeploy and restore utilization and execute on our growth pathways. As part of those ongoing investments, we expect our aircraft and maintenance spend will increase compared to last year. Wade will speak more about that in a minute. Overall, with our well-positioned fleet operation and our strong partnerships and demand, we remain optimistic about the year ahead. We continue to play the long game and have spent the last several years investing heavily in our fleet and in our people to ensure we are in the best possible situation to respond to strong market demands. Rob will now take us through the financial data.

Today, we reported a fourth quarter GAAP net income of $97 million or $2.34 earnings per share. Q4 pretax income was $134 million. Our weighted average share count for Q4 was 41.7 million, and our effective tax rate was 27.1%. For the 2024 year, we reported GAAP net income of $323 million or $7.77 earnings per share. First, let's talk about revenue. Total Q4 revenue of $944 million is up 3% sequentially from $913 million in Q3 2024 and up 26% from $752 million in Q4 2023. Q4 revenue breaks down with contract revenue at $786 million, up 3% from Q3 2024 and up 27% from Q4 2023. Proorate and charter revenue was $126 million in Q4, up 3% from Q3 2024 and up 14% from Q4 2023. Leasing and other revenue was $32 million in Q4, up 8% from Q3 and up 34% from a year ago. These Q4 GAAP results include the effect of recognizing $20 million of previously deferred revenue this quarter, similar to the $19 million recognized in Q3 2024. We deferred recognizing $63 million of revenue in Q4 2023. As of the end of Q4, we had $322 million of cumulative deferred revenue that will be recognized in future periods. We expect this Q4 run rate to continue in 2025, subject to production levels. Our GAAP results also reflect $5 million of below-the-line other income related to mark-to-market gains on our equity investments and gains from the sale of equipment. Let me move to the balance sheet. We ended the quarter with cash of $802 million, slightly down from $836 million last quarter and $835 million at Q4 2023. The decrease in cash during the quarter included the accretive actions of, one, repaying $115 million in debt before the financing on the four new E-175s delivered in Q4. Two, buying back 47,000 shares of SkyWest stock in Q4 for $5 million at an average price of $104 per share. Since the beginning of 2023, we have repurchased 11.2 million shares or approximately 22% of the outstanding shares of the company for $332 million at an average price of $29.76 per share. And three, investing $186 million in CapEx, including four new E-175 aircraft, additional E-175 spare engines the CRJ550s purchased from United, construction payments toward a new hangar in Tucson, along with other CapEx. Our CapEx investment in Q4 is up from $97 million in CapEx in Q3 and is an important catalyst to achieving our growth initiatives. We ended Q4 with debt of $2.7 billion, down from $3 billion as of year-end 2023. Cash flow is an important component of our shareholder value creation calculus. We generated over $500 million in free cash flow in 2024 and deployed it primarily to delever and derisk the balance sheet to the benefit of our partners, our employees and our shareholders. Our strong balance sheet and well-grounded liquidity are powerful tools as we pursue a variety of growth opportunities, including acquiring and financing 16 additional E-175s, repaying over $400 million in debt in 2025 and continuing to execute opportunistically on our share repurchase program. As we remain focused on improving our return on invested capital, we would like to highlight the following, our debt net of cash and leverage ratios are at their lowest point in over a decade. As a result of repurchasing over 11 million shares since the beginning of 2023, we had 40.3 million shares outstanding as of December 31, 2024, compared to 50.6 million shares as of the start of 2023. As of December 31, we had $48 million remaining under our current share repurchase authorization. We anticipate our total 2025 CapEx funding our growth initiatives will be approximately $600 million, including the purchase of 8 new E-175s and aircraft and engines supporting our CRJ550 opportunity. Total CapEx in 2024 was $340 million. Consistent with our policy and practice, we are not giving any specific EPS guidance at this time, but let me give you a little additional color on 2025. As Wade will discuss in a minute, we now anticipate our 2025 block hours to be up approximately 12% over 2024. The improved outlook in our 2025 block hours is driven primarily by improving fleet utilization and availability and ongoing strong demand for our production. We expect our 2025 GAAP EPS could be in the $9 per share area if we are successful in executing on the opportunities in front of us. For modeling purposes, we expect our 2025 depreciation expense will be flat to slightly down from 2024. Our CRJ700 contract extension and opportunities to place the CRJ550 aircraft into service are pushing out the estimated useful lives on our older CRJ700 fleet by a few years, offsetting the expected new depreciation expense from our incremental investment in CapEx. We are optimistic about our growth possibilities going into 2025 and 2026, including the following three focus areas. First, growth in underserved communities, driven partially by the deployment of over 20 additional CRJ550 aircraft. Second, improved aircraft utilization and availability on our ERJ and CRJ fleets. And third, placing 16 new E-175s into service in 2025 and '26. We believe that our strong balance sheet and liquidity and the actions we will be taking to invest in a variety of growth opportunities will position us well to drive total shareholder returns. Wade?

Thank you, Rob. During the fourth quarter, we reached an extension of a multiyear flying agreement that would allow for SkyWest to operate a total of 74 CRJ700s with American under revenue agreements. This new agreement will allow for these aircraft to fly for American through most of this decade. Last quarter, we announced a new multiyear flying agreement for a total of 40 CRJ550s with United, including 11 that we committed to purchase from United. United also had an option to add 10 additional CRJ550s to this agreement, bringing the total to 50. As of year-end, we had purchased 7 of the 11 aircraft and expect to purchase the rest by the end of this quarter. We were operating 4 of these aircraft at year-end 2024 and expect to operate 30 by the end of this year, with the last 10 entering service during 2026. Of the 40 CRJ550s, 29 will be modified from our existing CRJ700 fleet. I want to point out that this agreement represents net growth aircraft, along with additional new E-175s arriving by the end of 2026. We are excited about our continued strong partnership with United. We successfully launched our first Delta CRJ550 flying last July, and we anticipate transitioning 15 CRJ550s to our Delta fleet by the end of this quarter. These new Delta and United CRJ550 agreements, along with our CRJ700 extension with American, bringing the number of unassigned dual-class CRJ700s and 900s down to single digits. We expect these few aircraft will be assigned to one of our major partners soon. You'll recall that earlier in 2024, we announced a flying agreement for 20 United-owned E-175s from another United Express carrier to replace 20 CRJ200s under our United contract. As of year-end, we transitioned all of these aircraft and they were operating as of December. We also took delivery of 4 new E-175s for United during Q4. We have 16 new E-175s currently on order, 15 for United and one for Alaska. We expect delivery of 8 in 2025 and 8 in 2026. At the end of 2026, our E-175 fleet total will be 278, continuing to enhance SkyWest's position as the largest Embraer operator in the world. Let me review our production. Q4 completed block hours were up more than 5% compared to Q3 2024. Based on the current schedules from our major partners for Q1, we anticipate similar block hours to Q4. As a point of reference, our 2024 block hours increased by approximately 13% compared to 2023. We anticipate a 12% increase in 2025 compared to 2024, approaching our 2019 levels. We expect block hour seasonality to return to the model as utilization improves during the strong summer months. We still have approximately 30 parked dual-class CRJ aircraft that will be returned to service. The majority of these aircraft are currently under flying agreements and will be operating in 2025 and 2026. As flying quickly returns and we place CRJs into service, we continue experiencing challenges in our third-party MRO network, including labor and parts challenges. We expect maintenance expense to average $200 million a quarter during 2025 as we bring aircraft out of long-term storage and service the current fleet as production continues to increase. As you would expect, the maintenance expense will happen before the aircraft goes back into service. Our partners remain very engaged in supporting our efforts to restore production. I also want to review our plans to monetize our CRJ200 assets. We still own over 140 CRJ200 aircraft. These aircraft will have very little book value and no associated debt, and we have approximately 4 million cycles remaining to monetize. Our priority is to fly them at SkyWest Airlines under contract with our partners or in our prorate business. Our next priority is to operate these aircraft at SkyWest Charter or SWC. We currently have 18 SWC aircraft flying on-demand charter service. You'll also recall that our minority ownership stake in Contour includes an asset provisioning agreement under which SkyWest will provide CRJ airframes and engines to Contour. As far as our prorate business, demand remains extremely strong with great community support. We are seeing opportunities to return SkyWest service to several communities as we restore CRJ production. We will continue to work with the communities we serve on the best way to expand our service, as we increase our prorate business, we will see more seasonality reintroduced into our model. As typical with all airlines, Q2 and Q3 are strong revenue quarters and Q1 and Q4 are softer. We feel good about our ongoing effort to reduce risk and enhance fleet and financing flexibility and remain committed to continuing our work with each of our major partners to provide creative solutions to the continued demand for our products. Okay. Operator, we're ready now for our Q&A.

Thank you. And we will now begin the question-and-answer session. [Operator Instructions] And your first question comes from the line of Savi Syth with Raymond James. Your line is open.

Hey, good afternoon everyone. Maybe I can start off where we ended there just on the kind of ability to kind of bring back service to small communities. And I did notice SkyWest Charter had one more aircraft this quarter. I was curious just as you think about bringing back prorate, and is that more of a kind of post this summer or if you're expecting a lot of that prorate to come back this summer? And then just kind of specifically related to SkyWest Charter, I was curious if you've kind of reengaged with the FAA any differently on getting that commuter authority now that the kind of the administration has changed or if it's still too early?

Yeah. Hey, Savi. This is Wade. I'll talk a little bit about the prorate side. So as far as prorate, we have added a few markets in the fourth quarter, and there will be a couple in the first and second quarters. But the majority of what we're seeing is - the demand for the summer flying on a contract basis in our existing prorate is very, very strong for the summertime. And so we're looking more to Q3 at the end of Q3 and Q4 to add a lot of additional or other additional markets on the prorate side.

Yeah. Savi, this is Chip. I'll answer the second half of your question. I think the term that you use being reengaged in this is an understatement. We certainly do see a very good opportunity relative to the 2.5-year challenges at SkyWest Charter to get commute authority. We certainly are extraordinarily sensitive to the events that happened last night and the priorities at the Department of Transportation, but we look forward with optimism to reengaging this incredibly important strategic opportunity that we have to better serve communities. And so yes, we are definitely reengaging in that process.

Appreciate that. And if I might, just along those lines, Air Wisconsin recently lost the American contract and talked a lot about doing a lot of prorate and EAS. And just curious if you're seeing that impacting your opportunities or still too early?

No, we don't sense that it's going to impact what our strategy is. Again, we have a tremendous model with deep roots to all of these communities. It's what we were built on 50 years ago. And I think we deliver an exceptional product that's going to be very difficult to compete with mostly because of our passion and how integrated we are with these communities. So we're going to continue to press forward and do this in a very calculated safe manner.

Appreciate it. Thank you.

And your next question comes from the line of Michael Linenberg with Deutsche Bank. Your line is open.

Hi there. This is Shannon Doherty on for Mike. Just my first question, on the contract extension with American, can you give us some color on how the terms of that extension may compare to the previous contract?

Yeah. This is Wade. So as we said, we extended up to 74 aircraft. The term goes through close to the end of the decade, and the economics are very similar to what we have today.

Got it. Thanks. And maybe just touching on this EAS flying, and I know that you're focused on growing this service. Is there a risk that the Trump administration perhaps under Doge [ph] eliminates any certain markets under the EAS flying? Any insights on policy changes from your conversations with the Department of Transportation or any other government officials would be helpful.

Yeah. Look, I mean, I think we monitor this - this is Chip. We monitor this very carefully. Essential air service is something that has a lot of deep roots in a lot of locations throughout the United States. We understand what the direction of Doge is. And obviously, there's been some things this last week that we know that they're going to be very aggressive about it. I would also take you back to the confirmation hearings of the new Transportation Secretary. There was a lot of comments 6 or 7 times about his commitment to essential air service. There's a lot of political support for this program, not mostly because you deem it as wasteful spending, which is prevalent throughout the federal government, but mostly because of the investment and the circular nature of which it gives back to the economy in extraordinarily positive ways for these small communities. So look, our job is to make sure that we find the right tools and systems to serve these small communities. And we've been doing this for a long time and have faced a lot of challenges through various aspects of making sure small communities are served. And I think that we've got some good approaches and plans to make sure that we're successful for the long term in this.

That's great. Thanks for taking my questions.

And your next question comes from the line of Catherine O'Brien with Goldman Sachs. Your line is open.

Good afternoon, everyone. Thanks for the time. So we continue to hear more about the larger U.S. airlines needing to grow into their pilot workforces given aircraft delivery delays the industry continues to face. In some cases, we're seeing headcount reductions in pilots. You had called out last year, I think like on the same call, you need 1,000 pilots to get back to '19 levels and then another 1,000 to meet demand. How many more pilots do you have today versus a year ago and in the pipeline? And then just based on what you're saying about demand, is it perhaps you still need another one? Like even if you have 1,200 more pilots, do you still need another 1,000 just as demand continues to grow? Any color there would be helpful.

Yeah, Katie, this is Chip. I'm going to put a twist into probably what we said a year to 18 months ago because there's been some minor changes in how our aircraft are being flown, still very good for SkyWest. But we certainly have I think the major carriers have been very disciplined with our schedules to be a little bit more strategic and our utilization levels are slightly down compared to what it was, obviously, back in 2019. And I think that's worked out well for both of us. So with - we probably today have another 700 pilots than we did a year to 18 months ago for sure. We're not at the 2019 levels of pilots yet. But I think from our perspective, we've got a very disciplined approach. We've got some good slow consistent growth coming, which is at a better pace than what I think we were initially looking at, certainly, what Wade mentioned with aircraft coming out and being maintained and some supply challenges with that helps us. And so to be candid, we're on a very, very good pace of our growth. We like the way that it's come out. And I think it's stable, it's predictable and in a manner at which we have a very, very strong pipeline. But as of today, we are not hiring as many pilots as we anticipated we needed. And our attrition levels are extremely low. So from that perspective, I think for us, we're in a very, very good place with a good consistent growth plan that's going to enable us to do things on a very, very strong, consistent basis in the future.

Thanks. And then maybe just one on the uptick in the block hour production for this year. Now that growth looks a little more stable than perhaps the pace at which you thought was going to come back a year or so ago, what would provide further upside to that now 12% increase in block hours? Like where around the edges could that move up? Is it more prorate flying? Is it incremental aircraft get added in the year? I'm not even sure if that's possible with Embraer aircraft or I don't know if that would be like new partner aircraft coming to your property away from someone else? Like what would drive further upside to that plus 12 that was plus 10 a quarter ago? Thanks so much.

Yeah. No, it's a great question. This is Wade. So there's really a couple of things that I would say. Number one is fleet utilization could continue to drive that number up. That's probably the biggest thing. As Chip mentioned, our utilization is still a little bit lower than where it was in 2019. The second thing I would say is fleet availability. As we talked about, as we start to get through our MRO supply chain challenges, both from a labor and parts standpoint, if we exceed some of our expectations, then that could drive additional utilization or additional block hours into the system just as aircraft become more and more available during 2025.

That makes sense. And maybe I'll squeeze one third one in. So it sounds like on the dual class, CRJ700s, 900s it's a rounding or what's not on a long-term contract at this point. I know you still have some more on the CRJ200 front and you walk through kind of your waterfall of preferences where they go to a partner or prorate or secondarily, they go to Charter. And then you also mentioned like the asset offtake agreement with Contour. If we get to that part of the waterfall, I guess, those would be straight sales. Is that how we should think about that? Outside of Contour, would the third choice also be to sell to another entity? And what's the market look like in terms of demand for CRJ200? That was not a quick third question, so I apologize. Thank you.

That's a good one, though. So as far as the last part of the waterfall there, just getting rid of some of the assets, it is actually a combination with Contour. Generally, we sell the airframes and we lease the engines. The demand is still very strong out there. We're just very patient with our fleet. There's a lot of interest in our assets because they've been well maintained, and they have great records and things like that. So there is still good demand. And as Rob mentioned in his script, there was some sales during the quarter that added some value. So we're still actively looking to monetize our fleet, and we'll continue to do that.

Thank you so much.

And your next question comes from the line of Tom Fitzgerald with TD Cowen. Your line is open.

Hi, everyone. Thanks so much for the time. And congrats on a really incredible year. Just thinking about the long term and not trying to get too ahead of myself, but I'm just wondering if you could help us frame how - as people start modeling '27 and beyond, how we should think about the fleet? And then just with the theme of restoring service to small communities and we've talked together about this deurbanization [ph] that's occurred post pandemic. It seems like there's a lot of upside just beyond even just kind of getting back to 2019. So I'd love if you could just help frame how investors should think about the - some of the long-term secular tailwinds you guys have.

Yeah. So great question. This is Wade. I'll answer the fleet portion of it and Chip can help out with some of those other ones there. But the fleet, as we talk about, we still have very strong deliveries in '25 and '26. By the end of 2026, we'll have 278 Embraer 175s under long-term contracts. We will also have our CRJ550s all fully transitioned and up and flying. And then we still have dual-class airplanes that are still under long-term contracts on the CRJ side. So we will have continued growth getting into 2027 on the 175 fleet and then there's a lot of those 550s that will come up in that time frame that we'll have a very stable great fleet that will - we think that we can continue to operate well into 2030.

Yeah, Tom, this is Chip. I'll kind of tackle long term how to look at it. And I would probably just reiterate, I would say, an 8 to 10-year playbook that we've been playing that's been extraordinarily good for 175s, redeployment of our CRJ fleet across 4 amazing partners. And I would tell you that, that playbook is still alive and well and will likely be alive and well into the future. I think Wade talked on an earlier question about the impact of fleet utilization, fleet conversion to 550s. But I would reiterate still probably one of our biggest strategic assets is fleet flexibility. We're very strategic in how we make sure that we're taking care of partners within the length of these contracts and terms. We're getting to a little bit more of a mature state with our 175s coming off contract in the next couple of years. And all of that gives us a tremendous amount of flexibility to do some things to potentially continue to order more 175s for the long term. We don't have anything to announce today, but I would tell you that we continue to have good, strong, robust conversations with our partners about being the leader of flying the E175. The Aspen market has proven that we know how to do certain things with the aircraft really, really well. But without getting into specifics, I just wanted to maybe reiterate that we've got a very strong playbook. We have incredible credibility within the marketplace. Our team is the best in the industry. From our professionals perspective, pilots, flight attendants, mechanics, dispatch, everything, that credibility, combined with fleet flexibility, we are optimistic for the long, long term as well.

Okay. Great. That's all incredibly helpful, and that makes a ton of sense. Thanks so much. And then just as a follow-up, I believe the non-operating expense tailwind from the debt associated with the E175 fleet starts to kick in next year. So maybe I think it would be helpful if you just remind everybody about that aspect again. Thanks again for the time. Congrats.

Well, with respect - hi, Tom, it's Rob here. So with respect to the non-operating portion this quarter, I can say that in the fourth quarter, there was about dime worth of non-operating benefit that came from the combination of asset sales and other items. But going forward, that won't - that's not something that you should expect on a run rate basis.

And your next question comes from the line of Duane Pfennigwerth with Evercore ISI. Your line is open.

Hey, good afternoon. This is Jake Gunning on for Duane. Thanks for taking our questions. To kind of follow up on Tom's second question, leverage is at its lowest level in a decade. You mentioned the delevering occurring just as the E175 fleet starts to get fully paid off. Do you have any target leverage levels that you could speak to?

Hi. Thanks, Jake. It's Rob here again. So with respect to target leverage, again, we've been sort of waiting - we've been building toward this moment for the last several years as we've been deleveraging, we've been derisking our balance sheet. So as we're now to the point where we continue to have a strong order book, again, the 8 175s that we'll be taking in 2025 and the 8 in '26, we will expect to finance those the usual way with 12-year fully amortizing mortgage style debt like we have for the bulk of our fleet. So similarly, as we see an increase in our other CapEx related to spare engines, we may or may not choose to leverage those. We want to obviously continue to keep strong liquidity. And I think we've been - again, as I said, we've been preparing for the past several years for this these growth opportunities that we now see in front of us and being able to release those opportunities or take advantage of those opportunities because of the liquidity and the deleveraging that we've been able to do. So we're proud of the flexibility that we've got, the debt capacity that we've been growing on our balance sheet, the unpledged collateral of over $1.5 billion that we've got right now. We have a lot of flexibility depending on the nature of the growth opportunities in front of us.

Okay. Thank you, Rob. That's helpful. And I guess just to follow up, the 12% 2025 block hour growth, can you just give any color on the mix between contract flying, prorate and charter flying?

Yeah, this is Wade. The vast majority of that is contract flying. We - the vast majority of our flying is contract. And so it's really just getting airplanes better utilized on the contract side. That's number one. Number two is just bringing airplanes that have been parked, getting them up into service that are under long-term contracts, too. So the vast majority of that increase is on the contract side.

Okay. Thank you.

And there are no further questions at this time. So I would now like to turn the conference back over to Mr. Chip Childs for closing remarks.

Yeah. I'll end with where we started. Again, our hearts and minds go out to those that were affected by the unfortunate event of last evening. We continue to support our colleagues in that effort. We're humbled to be associated with the most amazing team in the industry with our people and hats off to how good that they continue to support and buy into our integrated model that we have to continue to grow long term. We appreciate the support from shareholders and everyone that's interested in our call. We appreciate and are humbled at the opportunity which we have to do the things in which we do because we're very, very passionate about it. So with that, we'll end the call and talk to you next quarter. Thank you.