Ladies and gentlemen, thank you for standing by, and welcome to the Q4 2019 Great Lakes Dredge & Dock Corp. 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 today’s conference is being recorded.

[Operator Instructions]I would now like to hand the conference over to your speaker today, Tina Baginskis. Please go ahead..

Good morning, and welcome to our quarterly conference call. Joining me on the call this morning is our Chief Executive Officer, Lasse Petterson; and our Chief Financial Officer, Mark Marinko. Lasse will provide an update on the events of the quarter and year, then Mark will continue with an update on our financial results of the quarter and year.

Lasse will conclude with an update on the outlook for the business and market for the coming years. Following their comments, there will be an opportunity for questions.During this call, we will make certain forward-looking statements to help you understand our business.

These statements involve a number of risks, uncertainties and other factors that could cause actual results to differ materially from our expectations.

Certain risk factors inherent in our business are set forth in our earnings release and in filings with the SEC, including our 2018 Form 10-K and subsequent filings.During this call, we also refer to certain non-GAAP financial measures, including adjusted EBITDA from continuing operations, which are explained in the net income to adjusted EBITDA from continuing operations reconciliation attached to our earnings release and posted on our Investor Relations website, along with certain other operating data.With that, I’ll turn the call over to Lasse..

Thank you, Tina, and good morning. As stated in our earnings release this morning, we had a strong fourth quarter and full-year results, including net income from continuing operations for the year of $55.7 million and full-year adjusted EBITDA from continuing operations of $135.6 million.

These results reflect a 35% increase over the prior year EBITDA from continuing operations.2019 was an active year at Great Lakes.

Our strong financial performance was a result of solid domestic dredging market and the continued effectiveness of our 2018 asset rationalization and cost reduction program.Net income from continuing operations increased by $45 million over the prior year, adjusted EBITDA from continuing operations increased $35 million over the prior year and net debt decreased by $163.2 million, which resulted in a healthy net debt-to-adjusted EBITDA ratio from continuing operations of 1x.2019 also saw the completion of the divestiture of our E&I business.

With these improvements and changes, we decided to renegotiate and reduce the size of our revolving credit facility to $200 million and extend the term five years.

We decreased the upfront pricing and reduced the interest rates, which now will provide us with a flexibility and the flexibility to execute on the company’s strategy over the next years.As we finished the fourth quarter of 2019, port deepening projects in Charleston, Jacksonville and Corpus Christi were in full operation with work continuing to this year.

Operationally, 2019 had fewer effective dredging days than 2018 due to several planned hopper and cutter dredge dry dockings.The impact was offset by strong project performance on the San Jacinto River flood prevention project in Houston, Texas; on the Delaware River deepening project; and on the major port deepening projects in Tampa, Jacksonville and Charleston.In 2019, we were also active on a number of beach and wetlands restoration projects, as well as maintenance projects for maintaining navigational depth in existing shipping channels and ports, both on the East Coast and in the Gulf.Our drive to an incident and injury-free work environment continued to progress with a 30% decrease in recordable incidents compared to 2018.

We are committed to ensuring that all projects are executed safely and in accordance with established environmental standards and that will leave the areas we touch in a better state as a result of the works that we do.To support this velocity, we continue to build relationships with various non-government organizations and conservation groups, such as a partnership and investment last year in the Florida Aquarium, who has a unique approach to coral conservation and restoration.And with those updates, I’ll turn the call over to Mark to discuss the results for the quarter and year and for an update on the backlog development..

Okay. Thank you, Lasse. I will start with the quarterly and annual consolidated results and then discuss some specifics related to our dredging business.

Please remember that as of December 31, 2018, all results from our E&I segment, which was sold in the second quarter of 2019, have been placed into discontinued operations and therefore, not included in the results that I will discuss.For the fourth quarter of 2019, revenues were $164.3 million, net income from continuing operations was $14.8 million and adjusted EBITDA from continuing operations was $32.6 million.Revenues for the fourth quarter of 2019 represented an $8.9 million decrease compared to the fourth quarter of 2018.

Lower revenue in rivers and lakes and coastal protection and dry dockings of our hopper and cutter dredges, both contributed to the decrease, offset partially by the increase in revenue from capital and foreign projects.Gross profit from continuing operations was $1 million lower compared with the fourth quarter of 2018.

However, gross profit margin percentage was 21%, compared to 20.6% in the prior year quarter.Operating income was $22.2 million, which is an increase of $5.5 million over the prior year quarter.

This increase is a result of the $4.6 million received from the settlement of various claims related to vessel construction and a decrease of $2.7 million in loss from sale of assets.

These factors were partially offset by an increase in G&A expense in the fourth quarter.Net income from continuing operations for the fourth quarter of 2019 was $14.8 million, compared to net income from continuing operations of $5 million in the prior year quarter.

The current quarter net income includes net interest expense of $6.5 million and an income tax expense of $1 million.Net income for the fourth quarter of 2018 included $7.9 million in net interest expense and $3.2 million income tax expense.

The decrease in tax expense is primarily due to an adjustment in the overall blended state tax rate that was made in the fourth quarter of 2019.Adjusted EBITDA from continuing operations for the fourth quarter of 2019 was $32.6 million, compared to adjusted EBITDA from continuing operations of $28.4 million in the fourth quarter of 2018.Turning to our full-year results.

For the year ended December 31, 2019, revenues were $711.5 million, net income from continuing operations was $55.7 million and adjusted EBITDA from continuing operations was $135.6 million.

These results represent a $90.7 million increase in year-over-year revenue, an increase in net income from continuing operations of $44.7 million and an increase of $35.2 million in adjusted EBITDA from continuing operations.For the full-year, the company recognized a loss from discontinuing operations net of tax of $6.3 million, compared to a loss from discontinued operations net of tax of $17.3 million in 2018.Next, we turn to our balance sheet, where at December 31, 2019, we had $187 million in cash and kept a zero balance on our revolver after we paid it down fully in the first quarter of 2019, leaving us with net debt of $135.8 million.

Our total capital expenditures for the year were $44.4 million.During the first quarter of 2019, the company made the final payment of $10 million on the clamshell dredge that was purchased in 2018.

This mechanical dredge was delivered in April 2019 and worked mostly on Jacksonville – the Jacksonville deepening project during 2019.Finally, the 2019 bid market this year totaled $1.8 billion, which was flat compared to 2018, but well above previous years.

Contracted backlog at December 31, 2019 totaled $589.4 million, compared to backlog at December 31, 2018 of $707.1 million.

The year-end backlog does not reflect $201.3 million of domestic low bids pending formal award and additional options pending on projects currently in backlog.With that, I’ll turn the call back over to Lasse for his remarks on the outlook moving forward..

Thank you, Mark. Turning to the outlook for 2020. We expect the domestic dredging market to continue to be solid and robust for the next years.

We expect 2020 to see bids for new phases of ongoing port deepening projects, such as Corpus Christi, Charleston and Jacksonville; and for new projects such as for the port of Mobile.We also expect continued good opportunities for beach and wetlands restoration projects.

In fact, we have already begun work on several large projects on the New Jersey and the Florida shorelines. All of these infrastructure improvement projects has strong support from the federal government, evidenced by the Congress-approved 2020 spending package, which included another record budget for the U.S.

Army Corps of Engineers.Federal supplemental appropriations were passed in the wake of Hurricanes Michael and Florence, and these beach and wetlands rebuilds and nourishment initiatives are now coming to bid.In addition, several liquefied natural gas, petrochemical and crude oil export projects are being developed in the Gulf of Mexico, creating the needs for port developments and navigational channels deepenings and widenings to accommodate the larger vessels involved in the strait.We had submitted several bids to the energy companies for projects that are now moving towards the notice to proceed.

To meet this expected increase in demand, we are upgrading our existing U.S. domestic fleet with new equipment and technology to increase productivity.We have expanded our U.S. fleet by reallocating capacity from the international market to the U.S., and we have bought and activated a large dredge and additional equipment in the U.S. market.

And importantly, we are now planning to build a new dredge for the U.S. market and other U.S. yard.In this respect, we have finalized the regulatory design for a midsized hopper dredge last year. Now we are in active discussions with U.S.

yards for construction of one new dredge with delivery in 2022, plus an option for an additional dredge to be delivered in 2023, provided our expectation regarding the new build costs on it.As reported last quarter, the international market remains low.

We are currently working on a large land reclamation project in Bahrain, which we target to complete in the third quarter of 2020.As mentioned in our last earnings call, the Ohio, one of our largest cutter dredges is in dry dock in Bahrain for major upgrades to her engines and pumps.

Upon completion of these upgrades, we plan relocating her back to the U.S. to meet domestic market demand.Also as discussed in our last earnings call, offshore wind power generation is coming to the U.S.

with more than 15 gigawatts of power generation capacity planned for installation over the next 10 years.As the timeline for these projects are being developed, we are continuing to engage with developers and partners on these project to use U.S.-owned, U.S.-built and U.S.-operated equipment, enhancing the local value creation and content, both in the construction phase and during operations.In conclusion, the fourth quarter results have met expectations and positively contributed to our strong performance for the year.

With solid projects in backlog, strong outlook in the domestic market and a healthy balance sheet, we believe we’re in a solid financial position to engage in new opportunities in 2020 and beyond.And with that, I’ll turn the call over for questions..

[Operator Instructions] Your first question comes from Jon Tanwanteng of CJS Securities. Your line is open..

Good morning, gentlemen. Thank you for taking my questions and very nice quarter and year..

Thanks, Jon..

First off, and just to congratulate you again, $135 million in EBITDA, I mean, we could barely contemplate that a couple of years back.

As you look into 2020, is there still upside to that number considering your backlog and pipeline what you have in terms of scheduled dry dockings and maybe the offsetting what you had 1x claims and the headwinds in 2019?.

Yep. So, Jon, as we look into 2020, we do expect additional improvement in 2020. We – at a high level, a couple of – we have fewer dry docks in 2020. So we had seven vessels this year, five next year.

What’s maybe offsetting that a little bit as we look forward is, we did have some exceptional project performance in 2020, which would kind of offset some of that.But yes, we do expect an increase in top line next year, not – obviously not to the levels of the increase we had this year.

We expect our margins to stay about at the gross margin level percentage, stay similar to where they were in 2019. And then in your G&A area, pretty much flat with where we were in 2019..

Got it. That’s good to hear.

And then in terms of what you are tracking, can you talk about the large projects that are in your line of sight? Which ones are the really meaningful ones? And more importantly, are your competitors able to bid on these, given they took on some pretty big projects late last year?.

Well, the market is always evolving. And I think that’s – I covered the projects that we see as major opportunities here for next – for this year. It is the continuation on new phases on existing port deepening projects, such as Charleston and Jacksonville and Corpus Christi.

And there are new port deepening projects coming to the market.The timing of these projects is a little uncertain.

But we do believe that Mobile will go ahead this year and there are other opportunities that are kind of coming in second-half of 2020, maybe beginning of 2021.With regards to the competition, we have seen some of the larger project this year go to other contractors than Great Lakes.

These projects have typically been on the in – inshore part of these deepening projects. It’s large volumes, but the projects are not as complex as when you’re working in the channel that is transitioning offshore and the offshore work. So it’s open for competition for other players and Great Lakes..

Got it. Thank you.

And then, as you bring new capacity into the U.S., whether it’s old ships from the Mideast coming back or new vessels, are you planning to sell the scrap any of the vessels in your current fleet here domestically?.

Jon, after – we still are rationalizing some smaller pieces of equipment. So the couple we’re looking at are both less than $5 million. So nothing big like we did in our big rationalization in 2017, 2018..

Okay, got it.

And then in terms of the new vessels or vessel with the option, what is the expected cost of that? When will you know kind of the shipyard you’re going to be working with? And when – what will make – what was the decision to pick up the option kind of happen?.

Yes. We are in active discussions with the shipyards. So I don’t want to comment upon the price level as low as possible as maybe a good answer. But we are going ahead with the discussions.

We are looking at a decision here in the first quarter and we will – when – hopefully, when we announce our first quarter results, we’ll be able to come back with some more details on that new build project.With regards to the option for one more dredge, I think a spacing of 12 to 18 months is a good number. But that’s down to negotiations as well..

Okay.

And currently, do you see the demand for that additional dredge? Is that why you have the option, or is it better economics on the second one? Just talk about the rationale for having that?.

Well, the way we look upon the market, we believe the market will be strong for the foreseeable future here. The new hopper dredge, the first one would definitely be added capacity to our fleet. When we then look at the option, it could either be added capacity or we have some older vessels that over time will become less economical to operate.

And then we have the option to either take them out, to take them international and then substitute that with the second dredge..

Okay. And maybe just one more detail to go along with that.

What is your outlook for the bid market over the next five years in terms of absolute size of growth just to support all this capacity bring – you bring online?.

Well, as you’ve seen, there has, from 2017 to 2019, been a very strong development in the bid market.

The driver stuff we see is clearly the deepening on the ports on the East Coast and also the export of oil products, LNG, petrochemicals, crude oil and the Gulf, all requiring deepening and widening of the shipping channels.In addition to that, we do see an increase in wetlands restoration.

We see an increase in the need for restoring beaches after major hurricanes. We do see climate change impacting and, let’s say, increasing the flood and the severity of some of these storms. So all these drivers are then increasing the need for our services.

And we do see strong support in Congress and in general, for increased spending on infrastructure and to make our defenses against these changes resilient.So for the next – as I see the market, there is a strong dredging market domestically for the next years and maybe longer than we can see today..

Great. Thanks, Lasse, and congrats, again..

Your next question comes from the line of DeForest Hinman of Walthausen & Co. Your line is open..

Hey, thanks for taking my questions kind of bounce around, because Jon hit on most of them, but just so we understand midsized hopper dredge, is that 6,000 cubic yards? What’s the number on that design that we are working with?.

Yes. The size of our midsized, we typically look upon between 5,000 and 8,000 cubic yards. That’s a midsize..

Okay. Just quick on the revenue side in the fourth quarter. I think in the last call, we’re talking about $190 million of revenue a little bit below that.

Was there any issues with revenue recognition or unplanned downtime in the fourth quarter that made that number come in below?.

Yes. This is Mark. No, nothing with revenue recognition. The largest driver in the quarter was actually our land reclamation job internationally. So we have some additional burrow areas that we needed to get permitting on, so that was delayed. And then because of that new burrow area, we have to change out equipment there.

So that work just got pushed into 2020. So that was the biggest driver in the quarter. We had a little bit of unplanned downtime, but the international job was the main piece..

Okay, that’s helpful. And you guys are probably getting tired of me asking about it. But can you just give us an update on where we stand with the senior bonds in the May call? The balance sheet is in really good shape..

Yep..

It just seems like that would make a lot of sense.

And then just an update on the thought, is it just redo that bond? Is it pay down that bond with another bond and keep – and use some of that cash? And then separately – or also along the same line, can we redo the whole capital structure on the debt side in May?.

So we’re actually looking at all of those options. But the – to – specifically to the bond market, as everyone knows, we – in May of 2020, that’s our first call – we can do a first call. They’re mature in May of 2022, but it’s a 104 premium. But the bond market is very good right now for these types of bonds.

So we’re looking – we’re talking engaging with a lot of different banks today to get an assessment of the market.It’s the – we would definitely have the opportunity at this point to refinance them at the size they are today. The market, if it was today, the market was – is good. You can reduce your interest rate and do that now.

You can have a longer tenor on these bonds. It’s a very attractive market right now.But we are looking at just the entire capital structure as we talk about the investments that we’re considering making, in particular, kind of these first two dredges. But yes, it’s a good opportunity for us and we’re taking a very close look at it right now..

Okay. And related to that line of questioning, it sounds pretty definitive that we’re going to bid for this – put bids out for this new vessel.

Is there any special financing things or government backing anything like that, where you can get a preferred rate or anything like that on vessel construction for Jones boats and have debt or revolvers or term loans that would just be for that specific vessel that we could put in place as well?.

Yes. I mean, not really from a government perspective, there’s some small stuff, but not to the size of this you can utilize.

But if you – if – and we’ve mentioned this before, the – this would be – these types of builds are paid overtime over essentially an 18-month, two-year period during the build time, so it’s not all released up front.So we do have the cash availability at this point to do this.

It’s all part of the equation related to the refinancing the bonds and the size of the bonds and the overall capital structure. So there’s nothing from a government perspective that really gives us any advantage, but we’re in a good balance sheet position to get whether use the cash we have on hand or some good financing options..

Okay. And then just clarity on the G&A comment you made for 2020. You said – I think, you said flat year-over-year.

Is that flat on a percentage of revenue basis or flat on a dollar basis?.

Flat on a dollar basis..

Okay, that’s helpful. In the press release, it didn’t have the operating cash flow number, I think.

Can you tell us what the operating cash flow was for the full-year?.

For the year, hang on a second. Sorry, you have to give me that one. I don’t have off the top of my head..

Okay. Well, you’re looking for that. Maybe can you help us think about you said revenues higher, margins up a bit. It sounds like the outlook for earnings would be growth. I know there’s some working capital moves in 2019..

That’s correct..

What’s the outlook for either operating cash flow....

Sure..

…or free cash flow in a year like 2020?.

Yes. That’s what – I have that answer for you. That’s what I thought you’re going to ask me. So if you kind of look at, say, don’t give guidance on next year, just kind of looking at, if you think of this 1 – this $135 million this year, next year, we expect about $40 million in CapEx, not including this vessel build.

That decision has not been made yet.There’s a little bit more – there’s a couple of leases we can buy out on smaller piece of equipment about $4 million. So you can start with this $135 million, take out $44 million for the CapEx and lease buyouts.

We have 20 – if the interest rate stays the same, we can’t do anything until May, about $26 million of interest.And then you’re exactly right on the balance sheet side, we’ve kind of been zero working capital, but I expect it to be about $30 million negative next year related to the – we had a very positive this year on deferred revenue, billings in excess of revenue.

So that’ll flip next year. When you kind of do that math, you’re in this $30 million, 40 million-ish of free cash flow for 2020..

Okay, very helpful. Thank you for taking all my questions..

Sure..

Your next question comes from the line of Nelson Obus of Wynnefield. Your line is open..

Yes. Hi, there. I had two questions. First of all, as you get into areas, which traditionally have not been your legacy dredging market, what type of caveats are you aware of? I realize you mentioned a number of them. So, they may not all be the same.

But I’m just curious whether you see the same type of opportunities there?.

Yes, Nelson. And the markets that we are looking at, it is clearly a domestic dredging market is our strong position. And when we are looking at new opportunities, for instance, in the wind market, we are looking at extending and building on our capabilities that we currently have in-house today.

So we are looking at modifying our equipment to participate in the preparation of the site and in supporting the structures.So we are very much looking at staying within our capability and our competence level and not get overextended.

This offshore wind market, there’s some very established international players who are coming in with a large lifting vessels and that is equipment that does not exist in the U.S. today. So that is capabilities that we don’t have and we are not planning to get into.

So very much a, let’s say, extension of what we do today and what our capabilities are today..

I’m sorry. What I – I wasn’t even thinking about wind. I was – you mentioned things like coral, and it seemed like you were mentioning opportunities away from the Army Corps, maybe I’m wrong, earlier in your remarks, nothing to do with wind, more obviously within your wheelhouse of dredging.

But are they comparable to dealing with the Army Corps, or do they deal with the Army Corps some of the things that you’ve mentioned earlier in your remarks?.

Yes. The – our focus is very strongly on what we call sustainability or ESG. And in that, it is taking care of our people, I’ll make sure they’re safe every day. And it is also to make sure that the environment that we work in is being taken care of enough.

We are protecting that and executing our work in a sustainable way.And in that respect, we are partnering up with organizations that can help us in advancing our ability and capability in that area. It’s not – we are not getting into work that is directly related to coral and other activity in that direction..

Okay.

So it’s not really – you’re not really moving out if we’re – of the arena that we’re in right now with some of these additional customers that you might work for, correct?.

In that aspect, no..

Okay. My second and last question every achievement comes with a downside, and those of us who follow the company are quite amazed at 1x in terms of leverage, unthinkable, as somebody mentioned on the call a number of years earlier. With that you’ve kind of entered into the overcapitalized arena.

And I’m wondering what the Board is? Is the Board addressing this issue? Obviously, acquisitions carry with them a lot of risk, dividend brings in a whole new slew of investors.

Where’s the Board in terms of opining on the blessings of overcapitalization?.

Well, I’ll start that out, and then Mark will continue with a couple of comments. Our restructuring of the company and the plan that we have going forward, we executed that restructuring plan quicker than what we had actually started out with.

And as such we are now in a position, as you say, we have a very strong balance sheet and we are evaluating our options going forward.The strategic options are clearly to solidify our position here in the U.S. for the domestic dredging market and to make sure our fleet and organization is focused on the future opportunities.

The other one is, as I mentioned on the call, this is the offshore wind development, where we do believe that we have a strong contribution that will come with some investments to get into that market.

And then clearly, there is M&A opportunity, which we would like to evaluate really on the basis of how can we contribute into that market if we decide to go in that direction.When it comes to dividends, Mark, you have….

Yes. I think, Lasse laid that out well. In terms of kind of the priorities we’re looking at, as we do talk to the Board, and the Board has asked us to look at all of these options in relation to the – how the balance sheet looks today.

So number one priority, refresh the fleet; number two, get into these markets that are very close to what we do like offshore wind; the third one would be M&A, as Lasse just mentioned.And then, I’d say, the dividend, share buybacks, those are we’re discussing, but I would say a lower priority compared to those first three.

And that’s the way right now we’re looking at, but we are – everything is on the table at this point..

Yes. Well, a small dividend doesn’t really take away too much from your free cash flow. I’m not really, personally a big fan of dividends, but they do bring in a whole new group of buyers who are mandated to buy companies with dividends. So I think your Board should be aware of that.

But all I would say is that this is a textbook case of the virtues of deleveraging by a great management and the shareholders have benefited. So keep it up..

Thank you..

[Operator Instructions] Your next question comes from the line of Chris Bliska of NOBLE Capital. Your line is open..

Good morning. Congratulations, gentlemen, on a great quarter, especially the EBITDA improvement and continued balance sheet improvement. Mark, I wondered if you could just comment on the G&A in the quarter $16.2 million, that looked a little high relative to our model.

Is there any color you can share on that?.

Yes. It’s not that much. It’s just a little bit of some consulting dollars. As we’ve had some opportunities to do some things forward looking with the company in terms of looking at the organization and what those opportunities are truly just driven by that. It’s not there. It’s just a little – bunch of little ideas. There’s nothing one.

No big outlier versus 2018..

Great. Thank you. And then just question on the timing of the redeployment of that vessel in Bahrain.

What would the timing on that be after repairs are done? Any sense of that?.

Yes. We are planning to complete the repairs now during the first quarter, and then it takes sometime to get her back here to the U.S, so she probably back here towards the end of Q2..

Very good. Thank you much..

Sure. Thanks, Chris..

Your next question comes from the line of William Feeley of Feeley Capital. Your line is open..

Good morning, gentlemen. And I missed the very first part of the call. So sorry if this is redundant. But I’m seeing some of these wind projects internationally that are large endeavors. And they’re getting financing, obviously. So that does seem an awfully interesting market.

How much capital expenditure is going to be required for specialized equipment to do some of that work? I know you mentioned not looking at trying to do that tower lifting and so forth. But site preparation, I presume would be the opportunity.

Is that fair?.

Yes. We are looking at activities that are close to what we do today and site preparation and to some extent, also working on the structures. Once they’re in place is work that we can do. The capital investments that we are looking at is similar to what we have on a dredge, if we are going to build new equipment. So it’s not major.

It’s not a huge DP-operated 3,000 tonne crane installation vessel that will come in from the international market, at least for the first developments and there is no such vessel in the U.S. today..

Thank you. Got it..

There are no further questions. Oh, your next question comes from the line of Tim Abbott of Twin Lions Management. Your line is open..

Hi, guys. I just wanted to follow-up on the bid market totals for 2019. So I know you said it was $1.8 billion for the full-year. I’m just wondering, by my math, that implies $3.28 billion for Q4.

So first, can you just confirm that that’s correct? And then can you also give the number that Great Lakes won in Q4?.

Q4, we won just the – it’s about 27% in Q4. I don’t remember the exact 27 points, but right about 27% in Q4. I don’t have the bid market number for the fourth quarter right in front of me, but that sounds close, yep..

Okay.

And then in 2020, I know you said you expect the bid market to be strong, but do you expect it to be up year-over-year versus the $1.8 billion in 2019?.

Right now, we expect the bid market to be as good as it was in 2019..

Got it. Okay, that’s helpful. Thanks, guys..

Thanks..

There are no further questions over the phone lines at this time. I turn the call back over to the presenters..

Thank you. We appreciate the support of our shareholders, employees and business partners, and we thank you for joining us in this discussion about the important developments and initiatives in our business. We look forward to speaking with you during our next earnings discussion. Thank you..

This concludes today’s conference call. You may now disconnect..