Kate Duchene - EVP & Chief Legal Officer Don Murray - Executive Chairman Tony Cherbak - Chief Executive Officer Tracy Stephens - Operating Officer Nate Franke - Chief Financial Officer.

Kevin McVeigh - Macquarie Jeff Silber - BMO Capital Markets Mark Marcon - Robert W. Baird.

Good day, ladies and gentlemen, and welcome to Resources Global Professionals' Fiscal 2015 Fourth Quarter Earnings Call. At this time, all participant lines are in a listen-only mode to reduce background noise, but later we'll be conducting a question-and-answer session and instructions will follow at that time.

[Operator Instructions] As a reminder, this conference call is being recorded. I would now like to turn the call over to your first speaker for today, Kate Duchene, Chief Legal Officer. You have the floor..

Thank you, operator. Good afternoon, everyone and thank you for participating today. Joining me on this call today are Don Murray, Executive Chairman; Tony Cherbak, Chief Executive Officer; Tracy Stephens, our Chief Operating Officer; and Nate Franke, our Chief Financial Officer.

During this call, we will be providing you with comments on our results for the fourth quarter of fiscal year 2015. By now you should have a copy of today's press release. If you need a copy and are unable to access via our website, please call Patricia Marquez at 714-430-6314, she'll be happy to fax a copy to you.

Before introducing Tony, I'd like to read an important announcement about certain statements that we may make during this call. Specifically, we may make forward-looking statements, in other words, statements regarding future events or future financial performance of the company.

We wish to caution you that such statements are just predictions and actual events or results may differ materially.

We refer you to our 10-K report for the year ended May 31, 2014 for a discussion of some of the risks, uncertainties and other factors such as seasonal and economic conditions that may cause our business, results of operations and financial conditions to differ materially from results of operations and financial conditions expressed or implied by forward-looking statements made today during this call.

I'll now turn the call over to Tony Cherbak, our CEO..

Thanks, Kate. Good afternoon and welcome to the Resources Global fourth quarter conference call. I'm going to begin by giving you a brief overview of our fourth quarter and yearend operating results. Total revenue for the fourth quarter was $148.8 million, up 1.3% from our fourth quarter a year ago on a comparable 52-week basis and 1.4% sequentially.

Compared to the full 14 week quarter a year ago, which included $9.8 million from the extra week, our fiscal 2015 fourth quarter revenues decreased 5.1%. For the year, revenue increased 6% to $590.6 million versus $557.4 million last year on a comparable 52-week basis.

In constant currency, revenues would have been $599.4 million or 7.6% higher on a comparable 52-week basis. Compared to the full 53-week fiscal period last year, our 52-week fiscal 2015 revenue increased 4.1% or 5.7% in constant currency.

Fourth quarter gross margin was 38.9% representing a 160 basis point improvement from the third quarter and was the same as the fourth quarter a year ago. During the fourth quarter, our SG&A cost were $42.5 million. Excluding $1.7 million in severance cost recorded in the fourth quarter a year ago, SG&A declined by $2 million quarter-over-quarter.

On a sequential basis, SG&A declined by $1 million. The quarter-over-quarter decrease primarily results from the extra week during the fourth quarter of fiscal 2014. During the fourth quarter, we generated cash flow from operations and adjusted EBITDA of $28.9 million and $16.8 million respectively.

For the quarter, our pretax income was $14.6 million and based on an effective tax rate of 44.3%, our fourth quarter GAAP net income was $8.1 million or $0.21 per share. During fiscal 2015, we returned $38 million of capital to shareholders in the form of dividends and share repurchases. Now let's talk about revenue trends.

As we reported in early April, weekly revenues during the first four non-holiday weeks of the fourth quarter averaged $11.8 million. For the remaining non-holiday weeks of the quarter, weekly revenues averaged $11.5 million. On a comparable 13-week basis, U.S.

revenue was up 3.4% quarter-over-quarter and international revenue declined 7.2% in dollars, but increased 7.9% on a constant currency basis. The decline in the rate of growth in our U.S. revenue during the quarter span across most geographies.

We believe however it's too early to conclude that this trend will continue as our recent weekly revenues in June have improved and our field personnel currently [report having] [ph] conversations with clients related to initiative based needs in the coming months.

These initiatives are broad based and include business intelligence software implementation as well as other data governance initiatives, revenue recognition assessments and implementations, regulatory compliance matters and various M&A integration and divestiture carve-out initiatives.

While the sales cycle for these initiatives is long, they're generally multiple consultant long-term projects. After declining to about $11.4 million per week in May, our non-holiday weekly revenues have increased to $11.7 million during the early weeks of our first quarter.

In addition, while Nate will provide further details with respect to our international operations, I am pleased with the recent progress we're seeing in Europe.

Although we still have several weeks left in the first quarter, Europe's weekly revenues during the first six weeks of the first fiscal quarter of 2016 have increased approximately 8% in comparison to Europe's non-holiday weekly average in the fourth quarter.

By now you have probably all seen the press release regarding Don's retirement as an employee. I would like to take this opportunity on behalf of our entire company to thank Don on his leadership in building a culture at RGP that we're all proud to be a part of. We look forward to his continued service at the company as our Chairman.

With that, I'll now turn the call over to Nate for a detailed review of our financial results..

Thank you, Tony. As mentioned, total revenues for the quarter were $148.8 million, up 1.3% quarter-over-quarter after adjusting for the 14th week last year and 1.4% sequentially. On a constant currency basis, the adjusted quarter-over-quarter increase was 4.4% and the sequential increase was 2%.

Our fiscal 2014 fourth quarter and year consisted of 14 weeks and 53 weeks versus 13 weeks and 52 weeks in fiscal 2015. Revenues during the comparable extra week of our fourth quarter a year ago was $9.8 million with 80% in the U.S. and 20% internationally.

For the 2015 fiscal year, adjusted revenues increased 6% and were $590.6 million versus $557.4 million in fiscal 2014 excluding the 14th week. With the 14th week included, revenue was $567.2 million. Adjusted annual revenue growth on a constant currency basis was 7.6%.

Now I'll speak to revenues on a geographic basis and to improve comparability the following revenue data utilizes Q4 fiscal 2015 revenues, compared to the fourth quarter a year ago adjusted to comprise 13 weeks. For the fourth quarter, revenues in the U.S. were $120.6 million up 3.4% quarter-over-quarter and down six tenths of a percent sequentially.

For the fourth quarter, total revenues internationally were $28.2 million, down 7.2% quarter-over-quarter and up 10.6% sequentially. International revenue accounted for approximately 19% of total revenues for the quarter, versus 17% in the third quarter of fiscal 2015 and 21% in the prior year quarter.

Europe’s fourth quarter revenue decreased 24.6% quarter-over-quarter and were flat sequentially, while the Asia-Pacific region saw fourth quarter revenues increase 14.9% quarter-over-quarter and 17.4% sequentially. On a comparable week constant currency basis, total international revenue increased 7.9% quarter-over-quarter and 14.5% sequentially.

On a quarter-over-quarter basis, the U.S. dollar was stronger against major currencies in Europe and Asia-Pacific. As a result, on a constant currency basis, Europe's quarter-over-quarter revenue decrease was 6.7%, while Asia-Pacific's quarter-over-quarter revenue increase was 24.5%.

On a GAAP basis, comparing to the 14 weeks comprising our fourth quarter a year ago, quarter-over-quarter U.S. revenue was down 3%, Asia-Pacific's revenue increased 6.9% and Europe's fourth quarter revenue declined 28.9%. Let me now discuss early revenue trends for the first quarter of fiscal 2016.

Weekly revenues for the first six weeks of the first quarter, which included the 4 of July holiday, aggregate to approximately $68.2 million, which is 2.7% higher than the comparable period last year. On a constant currency basis, this represents a 5.7% increase.

On a weekly basis, revenues were $11.5 million, $11.7 million, $11.6 million, $11.7 million, $10 million, which was the 4 of July holiday week and last week $11.7 million.

And thinking about the remainder of the first quarter, it is important to remember that we generally lose 4% or 5% of weekly revenue due to vacations taken by our consultants in the U.S. and Europe during the mid July through August timeframe.

Using 96% of the non-holiday weekly average achieved during the first five non-holiday weeks of the quarter, the weekly revenue computed for the remaining seven weeks of the first quarter would approximate $78.3 million, which yields first quarter revenue of approximately a $146.5 million.

This complication is purely mathematical and does not consider potential increases or decreases in weekly run rates over the balance of the quarter. Labor Day will fall in our second quarter similar to fiscal 2015. Now I’ll discuss gross margins.

Gross margin for the fourth quarter was 38.9%, the same as the year-ago quarter and up from 37.3% in the third quarter. The 160 basis point increased in sequential gross margin stems primarily from fewer U.S. holidays during the fourth quarter and the reduced impact of FICA taxes.

During the fourth quarter a year ago, we recorded a severance charge, a portion of which reduced our gross margin by approximately $300,000 or 20 basis points. Excluding reimbursable expenses, our fourth quarter gross margin was 37% -- 39.7%, which compares to 39.5% in the fourth quarter a year ago.

The average rounds of billing rate for the quarter was approximately $118, down from $120 in the third quarter and $125 a year ago. The average rounded pay rate for the fourth quarter was approximately $58 down from $59 in the third quarter and $63 a year ago.

Remember these hourly rates are derived based upon prevailing exchange rates during each given period. The decrease in the average bill and pay rates sequentially and quarter-over-quarter results from foreign currency translation and an increase in work performed in lower wage areas.

For the first quarter we would expect gross margin to approximate 39% roughly equal to the fourth quarter percentage. For the fourth quarter, gross margin in the U.S. was 39.8% and our international gross margin was 34.9%. Our consolidated gross margin for fiscal 2015 was 38.7% compared to 38.1% in fiscal 2014.

Now to headcount; for the fourth quarter, the average consultant FTE count was 2,528. This compares to 2,523 in the previous quarter and 2,309 in the year-ago quarter. Quarter-end consultant headcount was 2,516 versus 2,401 a year ago. The total headcount of the company was 3,258 at quarter end.

Selling, general and administrative expenses for the fourth quarter were $42.5 million or 28.5% of revenue versus $46.2 million or 29.5% of revenue a year ago. Our fourth quarter of fiscal 2014 SG&A included $1.7 million of severance charges related to European personnel.

Excluding this severance charge, prior year fourth quarter SG&A was $44.5 million or 28.4% of revenue. Sequentially, SG&A declined by $1 million primarily due to lower payroll taxes and marketing expenses. The quarter-over-quarter decrease primarily results from the one week difference between the quarters.

We believe SG&A expenses in the first quarter will approximate $45 million, an increase of $2.5 million from our fourth quarter. The change results from a stock compensation charge that I will discuss in a moment, an increase in FICA taxes and other cost associated with annual incentive compensation paid in July and increased marketing related cost.

Stock compensation expense was $1.4 million or nine tenths of a percent of total revenue, down 100,000 from the third quarter and down from $1.6 million in the fourth quarter of fiscal 2014.

We would anticipate first quarter's stock compensation to approximate $2.3 million, which includes a charge of approximately $900,000 or $0.01 per share related to the accelerated vesting of 127,500 stock options as Don transitions to Chairman of the Board from his current Executive Chairmen role as we announced earlier today.

At the end of the fourth quarter, our office count remained at 68, 45 domestic and 23 international. Related to other components of our financial statements, depreciation and amortization was $900,000 for the quarter, about the same as last quarter.

We would expect depreciation and amortization expense for the upcoming quarters to approximate $900,000. Our adjusted EBITDA or cash flow margin, which we defined as EBITDA before stock compensation was 11.3% for the fourth quarter, a 250 basis point increase from 8.8% in the third quarter and an 80 basis point increase from the year ago quarter.

In fiscal 2015, our adjusted EBITDA percentage was 10.3% up from 8.8% in fiscal 2014. During the fourth quarter, on a GAAP basis we recorded a provision for income taxes of $6.4 million on pre-tax income of $14.6 million representing an effective tax rate of approximately 44.3%.

Our fiscal 2015 effective tax rate was 45.4% and continues to be impacted by our current inability to offset income and tax jurisdictions in which are profitable, this losses in tax jurisdictions in which we are not. Our cash tax rate continues to approximate 42%.

For the first quarter of fiscal 2016, we anticipate a tax rate approximating 46.3%, which is adversely impacted by about 50 basis points for the stock compensation charge.

Our GAAP tax rate for each of the upcoming quarters is difficult to predict and could be volatile as the rate will be dependent on several factors including the mix of operating results between our U.S.

and foreign locations each of which are taxed or benefited at different statutory rates and the offset of a tax benefit of foreign losses in certain locations by valuation allowances. In summary, our GAAP basic and diluted income per share during the fourth quarter was $0.22 and $0.21 respectively.

For fiscal 2015, our GAAP basic per share income was $0.73 and on a dilutive basis was $0.72. Now to the balance sheet; cash and investments at the end of the fourth quarter were $112.2 million, up $19.9 million from the third quarter.

The increase results from cash generated from operations during the fourth quarter of $28.9 million offset in part by share repurchases and dividends totaling approximately $8.9 million and capital expenditures of approximately $1.3 million during the quarter.

For fiscal 2016, we anticipate capital expenditures of approximately $3 million net of landlord reimbursements of which about $1.2 million should occur in the first quarter. For fiscal 2015, we generated cash flow from operations of $31.8 million.

During the fourth quarter, we repurchased approximately 364,000 shares of our common stock at an aggregate cost of $5.9 million or $16.29 per share. During fiscal 2015, we repurchased a total of 1.7 million shares at an aggregate cost of $26.3 million or $15.65 per share.

These shares purchased represent 4.4% of the outstanding shares as of the beginning of fiscal 2015. Our current stock buyback program has approximately $16.7 million remaining.

We will continue to return cash to shareholders through our regular quarterly dividend and share repurchases while maintaining a balance between the capital requirements of growing our business in fiscal prudence. Our shares outstanding at the end of the fourth quarter were approximately $37.3 million.

Receivables at quarter end were approximately $96.6 million compared to $98.2 million at the end of the third quarter. Days of revenue outstanding were approximately 58 days versus 57 days in the third quarter and 56 days in the comparable quarter a year ago. Now I would like to turn the call over to Don for some closing thoughts..

Thank you, Nate. Overall, I’m pleased with our fiscal 2015 operating results. On a comparable week and currency basis, revenues grew 7.6%. We improved our gross margin 60 basis points to 38.7% just shy of our goal of 39%, which includes the impact of zero margin reimbursable expenses.

Importantly, we converted almost 98% of the incremental gross margin dollars generated from revenue and gross margin improvement to operating income. Consequently our adjusted EBITDA margin increased 21.7% to $60.6 million or 10.3% of fiscal 2015 revenue.

The continuing improvement in our operating performance has allowed to return over $78.2 million to shareholders during the past two years and our Board of Directors will evaluate increasing our dividends on our upcoming Board Meeting. I also anticipate we will continue our trend of share repurchases in fiscal 2016.

So as we enter fiscal 2016, our client continue to provide a solid foundation for continued growth. Related to our clients I am pleased to report the following statistics for fiscal 2015. Client continuity remains outstanding and during our fiscal 2015, we served all of our Top 50 clients from fiscal 2014 and 48 from fiscal 2013.

In fiscal 2015, we've served 229 clients exceeding $500,000 in fees, compared to 225 clients during this level in fiscal 2014. During fiscal 2015 our top 50 clients represented 41% of total revenue and while 50% of revenues came from 78 clients.

Our loyal client following is reflective of our client service approach and the quality of the work performed by our consultants. Our largest client for the year was approximately 3.1% of revenue.

For fiscal 2015, 96% of our top 50 clients have used more than one service line and 82% of those top 50 clients have used three or more service lines and this service line penetration reflects the diversity of relationships we have within our client organizations.

Additionally the industry representation of our top 10 clients during fiscal 2015 reflects the diversity of our client base. Our top client is a global insurance company. The next two largest clients for the year are global financial institutions. The fourth largest is a leading refiner and processor. The fifth largest is a global technology company.

The sixth is a leading auto manufacturer. The seventh is a global aluminum manufacturer. The eighth is a global financial institution. The ninth is a global pharmaceutical company and the tenth is a leading healthcare provider. So our client diversity is a key strength of our business.

As disclosed in today's press release, I’ll be retiring as an active employee at the end of the first quarter. It has been an exciting journey from starting the business for almost 20 years ago, years of rapid growth surviving two recessions, a dotcom year and then the financial crisis.

Now I want to thank our great clients, employees and investors for their support. I will remain as Chairman of the Board and look forward to the further success of RGP. This concludes our prepared remarks and we’ll be happy to answer your questions at this time..

[Operator Instructions] Our first question this afternoon comes from the line of Kevin McVeigh from Macquarie. Your line is open. .

Great. Thanks. And let me add my congratulations to you Don obviously, bringing the company to where it is today.

Hey Tony or Don or Nate, I just wanted to get a sense just at a very high level, how much do you think is the incremental step up in compliance cost across organizations are impacting the resources model because I feel like we’re kind of getting deep into the cycle here.

The earnings are still kind of off peak and just not seeing the level of reacceleration I would have expected at this point?.

Well Kevin, relative to compliance cost, if we look at our clients and the compliance cost, they’re varying especially in our financial institutions, it creates a great opportunity for us. Right now it’s kind of moving from helping clients from a crisis mode into more sustainability on risk control procedures.

So we’re still very optimistic about our business. If you look at kind of what we reported today, we have a great pipeline in the U.S. I know that it kind of slowed down in the fourth quarter. We have great expectations for this coming year though just based upon the conversations that our people are having with our clients.

Asia-Pac is going great guns. They’re kind of on fire. 15% growth in the current year but 24% on a constant currency basis and we’re starting to see a turn in Europe. So we’re very confident in our business..

Okay. And then just any sense to size, I know you’re doing some work at large offshore project.

How much that’s impacted the bill rates overall? Is there a way to put a dollar impact on that?.

Kevin I guess what I would tell you is that if you look at the decrease in the bill rates, really the sole driver of those is the translation and then some other offshore work.

If you actually look at the year-over-year, the bill pay spreads, they’ve actually improved and that’s what’s driving a portion of that gross margin improvement year-over-year..

Got it. Got it. Okay. Thanks so much. I’ll get back in the queue..

Sure..

Thank you. Our next question comes from the line of Jeff Silber from BMO Capital Markets. Your line is open..

Thanks so much.

I know you’ve mentioned that trends seem to have improved somewhat this quarter, but can you just go back to what happened in the last quarter in the U.S.? Why you think weekly revenue growth slowed?.

Well, I would just say, again we have a very good pipeline. Our people are having a lot of conversations with clients about very broad based initiative.

The only thing that we can tell is we had little bit of lull because some of the projects that we were talking to our clients about are a little bit longer decision cycle and that's really all we can say. It looks good going forward. Our people are extremely optimistic about this year. So we’ll see, but it was just again little bit of a lull in Q4..

And the lull with a longer decision cycle, any specific industries or geographies that you saw that in?.

Pretty much across the board, but again it's just little bit slightly longer decision making cycle relative to some of these projects that we’re selling. We’ve actually sold a couple of projects that we’ve been approved for right now that aren’t going to start for a couple of months.

And so that’s just -- that’s all we can -- there has been a little bit of macro noise, but I just look at that as noise. I think that -- I think going forward, I think in Q -- I think we will finish out Q1 pretty strong. I think Q2 will really accelerate..

Okay.

And then focusing on this here’s just a couple of numbers question, in terms of stock-based compensation and depreciation and amortization for the rest of the year, I’m sure we use the first quarter number obviously taking out that one-time charge that you mentioned in stock-based comp?.

Yeah, I think that kind of puts you pretty close..

Okay.

And on the tax side, sorry to go back to last quarter, you mentioned a 50 basis point impact, the tax, I am sorry this quarter, is the tax rate higher or lower by 50 basis points because of the stock-based comp?.

For the first quarter it’s higher as a result of that stock comp charge.

So going forward, if you look at the full fiscal year as we say it's pretty hard to predict, but it will probably - if I were making a guess, I would say it would probably end up somewhere around 44% give or take on a 12-month basis, but there will be some movement quarter-to-quarter..

Okay. Great. That’s very helpful and Don again thanks for everything and best of luck..

Thank you..

Thank you. [Operator Instructions] Our next question comes from the line of Mark Marcon from Robert W. Baird. Your line is open..

Hi, good afternoon. I would like to add my coagulations to you Don for all you've done over the years. With regards to the trends just on the bill rate, in the U.S.

specifically are the bill rates flat, just U.S.?.

I think in the U.S. they are up and as I said if you look at the overall bill pay spread that is actually -- it's actually improved. So billing rates in the U.S. are improving..

How much?.

Yeah, Mark I don’t have that -- we typically not disclose bill rates by geography, but I would tell you that spread has improved and that's what you see in the -- if you look at year-over-year gross margin and the like..

Okay. And then with regards to international, you mentioned that Europe seems to be stabilizing.

Can you give a little bit more color around that just in terms of Netherlands, Sweden, which geographies in Europe are stabilizing and what sort of progress you think has come over the last 13 weeks there?.

Yeah, it's all of those markets like we’ve seen improvements in the Netherlands and in Sweden in the U.K. also in France. So look it's hard to say at this point in time that it's fixed that it’s certainly more of a long-term cycle than that.

But it feels good that it’s going in the right direction and some of the things that our new fellow over in Europe is putting into place are actually working.

We're very pleased to see these first few weeks sequentially improving versus the fourth quarter, but we still have a long way to go, but at least the trend line is right and Tracy do you have anything to add to that..

No. Only thing I’d add is, it does feel better. Much work remains to be done. I previously mentioned we had a pretty focused European turnaround plans. We're starting to feel good to see progress and we're executing that plan.

We saw some pretty broad stabilization in the fourth quarter and like Tony just mentioned a nice little uptick in the early part of our year this year in the first six weeks. So we're pleased with the direction. Lot of work remains to be done. It’s still early and we hope the trend continues and we’ll work hard to continue to see if we can do it..

Okay.

And how far away are you from breakeven in Europe at this point?.

We still have ways to go, but I would tell you that the goal at the time we were reporting 12 months from now, we hope to be there Mark..

This year is really to grow the revenues and we hope to return to profitability in fiscal 2017..

In 2017, and for 2015 how much of a drag was Europe?.

On a tax basis, it's still several million dollars after we're done allocating everything, some of the U.S. cost and the like..

Okay. And then with regards to Asia-Pac obviously nice success there.

Is it just one or two big projects in a certain region or what's driving that 25% [PC] [ph] growth?.

Yes it's very broad based. In fact one of the great things that they have going right now is a very nice mix of both international clients as well as home grown clients. So you see it across multiple industries. It's not any one particular project, but really good growth in China. Japan has been strong as well, but they've been hurt by currency.

If this currency issue it with the Yen, that returns around Japan will have the growth rates in Asia-Pac should be very nice..

Okay. And just going back to the U.S. just in terms of the law, last quarter we talked about energy and a drag there, can you comment a little bit about that and then in terms of the broader based flow, can you -- do you think it was just the slowdown in the economy that….

When I look across the U.S., the one area that -- really the only one that I’m concerned about right now is our South Central practice because it relies so much so heavily on the oil and gas client and there is certainly a problem there because with oil at 60 bucks or a little bit less a barrel just the big oil companies are really scaling back.

In fact, Tracy was indicating that there is a huge decrease in the amount of rigs that were actually drilling right now and that generally indicates that they're cutting back on all other expenses and we can see it in our business.

But when I look at our Northwest practice our Southwest practice, practice in the East, all of them have tremendous momentum right now and I think throughout the rest of the year, we have great aspirations for what we're going to be able to achieve in the U.S..

Mark, I would just add in terms of that color when you look back at that fourth quarter going really from where we started the quarter at $11.8 million and then dropping to back $11.4 million, $11.5 million, that $11.8 million had kind of encompass because we had already been experiencing the oil and gas reminder.

It was actually interesting, it was just a little bit in a lot of places.

So it was really hard to put our finger on other than the fact as Tony had mentioned earlier when you are visiting the offices and talking about people and the amount of proposal on a activity, most of our people are reporting they're busier than ever, but as Tony mentioned, a lot of these projects just because of their type have what I would call just a much more lengthy internal decision making process.

So that again gives us the confidence that it's really hard to put your finger on. The positive obviously is how quickly it's bounced back and while it's only week it's really nice to see that week after the 4 of July hold at that $11.7 million as we drift into just the normal summer time impact of vacations and the like.

So yes, I don't have a better answer, but it was a little bit in just a lot of different geographies aside from the energy side..

And can you just remind us the energy side, I am sure you've looked at it a little bit more just in terms of how big that is in terms of the exposure and….

Oil and gas is about 5% of our revenues..

Great. Thank you..

Thank you. There are no more questioners in the queue at this time. So I would like to turn the call back over to management for closing remarks..

Well, thank you very much for your continued support and interest in Resources and we look forward to talking to you on our next update for the first quarter. Thanks a lot..

Ladies and gentlemen, thank you again for your participation in today's conference. This now concludes the program and you may all disconnect your telephone lines. Everyone have a great day..