Good morning and welcome to the SPAR Group's Third Quarter 2022 Financial Results Conference Call. All participants will be in listen-only mode. [Operator Instruction]. Please note this event is being recorded. I'd now like to turn the conference over to Phillip Kupper with Three Part Advisors. Please go ahead..

Thank you, Operator, and good morning, everyone. We appreciate you joining us for the SPAR Group Inc.'s conference call to review third quarter results for 2022. Joining me on the call today are SPAR's, Chief Executive Officer, Mike Matacunas, and the company's Chief Financial Officer, Fay DeVriese.

This call is also being webcast and can be accessed through the audio link on the events and presentations page of the Investor Relations section at investors.SPARinc.com. Information recorded on this call speaks only as of today, November 14, 2022.

So please be advised that any time-sensitive information may no longer be accurate as of the date of any replay or transcript reading.

I would also like to remind you that the statements made in today's discussion that are not historical facts, including statements, or expectations, or future events, or future financial performance, or forward-looking statements, made pursuant to the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995.

Forward-looking statements by their nature are uncertain and outside of the company's control. Actual results may differ materially from those expressed or implied. Please refer to the earnings press release that was issued today for our disclosures on forward-looking statements.

These factors and other risks and uncertainties are described in detail in the company's filings with the Securities and Exchange Commission. Management may also refer to non-GAAP financial measures and the reconciliations to the nearest GAAP measures can be found at the end of our earnings release.

SPAR Group assumes no obligation to publicly update or revise any forward-looking statements. Finally, the earnings press release we issued earlier today is posted on the Investor Relations section of our website at SPARinc.com. A copy of the release has also been included in an 8-K submitted to the SEC.

And now I would like to turn the call over to the company's CEO, Mike Matacunas.

Mike?.

Thank you, Phillip and good morning, everyone. I'm pleased to share our third quarter results and comment on our progress on a number of initiatives. At the end of our prepared remarks today we will open the line for questions from analysts and institutional investors. Total revenue for the third quarter was $70 million.

This reflects a 4% increase year-over-year on a reported basis. On a constant currency basis total revenue grew by 7% over the year ago quarter. As a reminder, we report in three segments Americas, EMEA and Asia Pacific or APAC.

I will comment on each one first on a reported basis and then on a constant currency basis or on an organic basis, which excludes the impact of foreign exchange. Our Americas segment reported record revenue of $53.7 million, an increase of 7.8% and the Americas grew organically or on a constant currency basis by 8.1% during the third quarter.

In addition to the United States, the Americas division includes Brazil, Mexico and Canada. Within the Americas, the U.S. grew by 13% and delivered a record $32.5 million in revenue. Our core merchandising services business grew by 15.5% in the third quarter with the addition of new clients and expansion in our current plan agreements.

This is on top of 6.1% growth in 2021 to comprise a 21.6% two years stacked growth in our domestic business. Our resets and remodels business continued to expand in the third quarter and grew by a strong 62% over the prior year.

Momentum continues as we are working with more than 20 of the largest retailers in the country, often as a preferred partner to help them reset categories open stores, remodel locations and renovate.

We remain bullish on the growth of our remodel business as the industry continues to invest in reinventing physical stores across key segments such as big box, discount drug and convenience. Our Brazil joint venture reported record revenue growth of 13.3% in the third quarter essentially the same as a 13.5% organic expansion.

The strength is based on winning new business and expanding current client agreements. In addition, we grew EBIT for our Brazil venture by 15.3%. The Brazilian AI has been relatively stable over the last several months. Therefore, these numbers are largely the same in constant currency.

Our EMEA segment representing our joint venture in South Africa, reported revenue of $8.9 million down 7.3% and on a constant currency basis expanded by 8.3% over the prior year quarter. We've won new clients renewed large multi-year agreements, and increased EMEA EBIT on a reported basis by 14.7%.

Organically EBIT for EMEA, grew by a strong 41% over last year's quarter. Asia Pacific segment reported revenue of 7.1 million, which represents a decline of approximately 774,000 or 9.8%. On a constant currency basis, total revenue improved by 0.4%.

Based on the mix of a China revenue decline of 1.8, Japan decline of 7.5% offset by organic growth in Q3 of 1.5% in India, and a strong 134% increase in Australia albeit small numbers for this joint venture. We continue to watch the APAC market, it makes up approximately 10% of our overall revenue, but is immaterial to our bottom-line.

Therefore, we are exploring alternative approaches to improve the leverage of these businesses and ensure we are focused on delivering value for our clients and shareholders. With a solid organic revenue performance in the quarter of over 7%, let's turn our attention to gross margin.

Our third quarter gross margin was 18.4% compared to 18.7% last year. Our America segment which represented 77% of the total business in the quarter, compared to 74% last year, maintain gross margin at 17.2% same as last year. We continue to focus on pricing, productivity and leverage of technology during the quarter.

Our EMEA segment reported a strong 23.4% gross margin and improvement of 370 basis points. We worked hard and merchandiser productivity and margin enhancement initiatives this year, I am pleased that this is reflected on our third quarter number.

The countries that make up APAC for us China, Japan, India and Australia combined, delivered a gross margin of 21.2% down 590 basis points from the prior year same period, while a small dollar part of our gross profit to 29 percentage drop year-over-year in gross margin dollars from APAC lowered the consolidated gross margin percent.

As I've noted several times, we'll continue to focus on gross profit. And I'm pleased with the results today. I believe there's more opportunity to improve margins and we'll continue our pursuit of this. Turning to operating income we reported consolidated operating income of 1.7 million.

There are a number of one-time expenses related to our strategic alternatives investment, including accounting, consulting, investment banking and other expenses that impacted our operating income for the quarter. Combined with negative operating income from our APAC business, our operating income is down 35% from last year, same period.

As I noted in the press release, I expect these expenses and effects to be temporary in nature. While we stay focused on growing the top-line improving gross profits and creating more operating leverage.

After Fay covers the detailed financial results for third quarter and first nine months of 2022, I will come back and share additional thoughts on our business in progress. With that, I would like to turn the call over to Fay DeVriese, our Chief Financial Officer to review our results..

America, APAC and EMEA. Americas is comprised of the United States, Canada, Mexico, and Brazil. APAC is comprised of China, Japan, Australia, India. And finally, EMEA is comprised of South Africa. We have included a new segment table in our press release that includes revenues and operating incomes for each of our segments.

Third quarter 2022 net revenues totaled $69.8 million, an increase of 3.6%, which includes $53.7 million of revenues from the Americas, $8.9 million from EMEA and $7.1 million from APAC, as the U.S.

dollar strengthened against other currencies this quarter and year, a number of our international businesses, particularly in Japan, in South Africa, suffered from significant foreign exchange adjustments. Excluding the foreign exchange impacts, our third quarter revenues improved by 7.2% on a constant currency basis.

By segment for Q3, the Americas revenues increased over the year ago quarter by 7.8% or 8.1% on a constant currency basis, and EMEA Q3 revenue decreased by 7.3% but increased 8.3% on a constant currency basis, and APAC Q3 revenue decreased by 9.8% and it was up 0.4% on a constant currency basis.

As Mike as mentioned earlier, our Americas segment revenue increase was primarily driven by positive momentum from our reset and remodel work in the U.S. and Brazil. The revenue decrease in EMEA was due solely to negative foreign exchange impasse for our South African business.

In constant currency, EMEA revenues would have been up 8.3% compared to Q3 last year. Headwinds in APAC for the quarter was due to pandemic-related lock down in both China and Japan along with foreign currency pressures impacting Japan.

Australia's revenues were strong, but the numbers are small and be not offset pressure results for other countries for APAC. Third quarter gross profit was 12.8 million, or 18.4% of revenues compared to $12.6 million, or 18.7% of revenues in the prior year quarter.

Selling, general and administrative expenses for the third quarter totaled $10.6 million, or 15.2% of revenues, compared to $9.4 million, or 14% of revenues in the prior year quarter. SG&A increases were primarily due to increased marketing and non-capital IT investment as well as consulting and all related fees.

Third quarter operating income was $1.7 million versus operating income of $2.7 million in the prior year quarter. Net loss attributable to SPAR Group Inc., for Q3 was $32,000 compared to a net income of $1.2 million or $0.06 per share in the year ago quarter.

Adjusted net income attributable to SPAR Group Inc., in the quarter was $212,000 or $0.01 per share, compared to $1.4 million or$0.07 per share in the year ago quarter. Consolidated adjusted EBITDA in the 2022 third quarter was $2.5 million, compared to $3.5 million in the prior year quarter.

Q3 adjusted EBITDA attributable to SPAR Group Inc., was $1.2 million, compared to $2.4 million in the prior year quarter. You can find the GAAP to non-GAAP reconciliations for management's financial measures at the end of today's press release. For the first nine months of 2022, net revenues were $196.6 million a 0.5% from the year ago period.

For the segment's year-to-date revenues were $150 million for the Americas, representing 76% of total revenues, EMEA was $27.3 million, or 14% of total revenue and APAC was $19.4 million or 10% of revenues.

Gross profit for the first nine months was $37.6 million or 19.1% of revenue compare favorably to $36.8 million for 18.8% revenues in the prior year period. Gross margin increased 30 basis points.

The improvement was due to strength in the Americas up 80 basis points and EMEA gross margin was up 250 basis points due to successful improvement actions and favorable mix shifts in certain markets. Despite strength in the other two segments, APAC negatively impacted margin by 460 basis points due to pandemic lockdown throughout the period.

SG&A expenses were $30 million or 15.2% of revenues compared to $28 million, or 14.3% of revenues in the prior year nine months primarily due to a rebound of business from the pandemic. Year-to-date Q3 operating income was $6.1 million, or 3.1% versus $7.3 million or 3.7% in the year ago period.

For the first nine months, net income attributable to SPAR Group, Inc., was $1.8 million or $0.08 per share, compared to $2.6 million, or $0.12 per share in the year ago period.

Excluding the non-controlling interest, adjusted net income attributable to SPAR Group Inc., was $2 million or $0.09 per share, compared to $3.2 million or $0.50 per share in the year ago period. Consolidated adjusted EBITDA for the first nine months was $7.9 million compared to $9.7 million in the prior year.

Excluding the non-controlling interest, adjusted EBITDA attributable to SPAR Group Inc., was $4.9 million, compared to $6.5 million in the prior year. You can find the GAAP to non-GAAP reconciliations of management's financial measures at the end of today's press release.

Now, turning to the company's financial position as of September 30, 2022, the company balance sheet remains strong and total worldwide liquidity at the end of third quarter was $15.3 million with $12.1 million in cash, cash equivalents and restricted cash and $3.2 million of unused availability as of September 30, 2022.

The company's working capital as of September 30, was $24.7 million and accounts receivable balance was $66 million. Finally, with a three-month period ended, September 30, 2022, we repurchased 74,000 shares of SGRP common stock under our Board authorized share repurchase program. With that, I would like to turn it back to Mike..

Thank you, Fay. On September 8, we announced that the Board had initiated a process to evaluate potential strategic alternatives to maximize shareholder value.

This process includes a full range of options including a sale merger, divestiture going private, as well as other potential value creation opportunities to accelerate our growth and return profile as a publicly traded company. The management team is fully engaged with the board on exploring ways to unlock value for the shareholders SPAR.

We have not set a timetable for the conclusion of this review, and I do not have an update today. So I will not be answering questions related to the company's strategic alternatives process after our remarks. As always, we remain optimistic about our business prospects, especially given the macro environment going into the holidays.

Our business has not slowed. Our pipeline is robust, and we have been successfully taking share from our competitors. While we recognize consumer confidence is low in the U.S. market and interest rates are rising globally. We do not expect this to have a meaningful impact on our plans.

We work with brands and retailers and segments that are needed in any economic environment. The list of our largest 10 clients includes those in the discount retailing market, large box retailers were opening stores today, brands that sell consumable products that people need every day, food products, pharmacies, and more.

Most of these companies have been announcing comparable sales growth and expansion. At the same time, we've begun discussions with a number of clients and prospects that are under commodity price pressures, and margin challenges and would like to explore how SPAR can provide them leverage.

For those with large field organizations, they are asking us about syndicated models that share expenses, better use of technology to capture insights to make targeted visits and multi-country agreements that can create leverage for them.

For our retail clients that are expanding, we are talking with them about regional and national capabilities that can accelerate their plans to capture more market share. Our growth and our resets remodel business, year-over-year is an example of this. This part of our U.S. business grew 62% compared to the same period last year.

We are working with large retailers in the U.S. and Canada to help them prepare new stores and renovate current stores. I'd like to give you more insight to give you a sense of the opportunity ahead. In May, the National Retail Federation has published an article titled U.S.

retailers announced nearly seven times as many store openings as closings in the first quarter of 2022. They noted that consumers are returning to stores as the pandemic eases. They also noted that the openings are concentrated in discount, dollar, auto parts and off-price sectors. In short, these are our clients.

For SPAR this presents us continued opportunity. When a retailer plans to build or open a store they do not have any staff. In fact, most retailers don't hire the staff to work in the store until a few weeks before the grand opening wherever the fixtures, signage and product begin arriving sooner than this.

So you need people who know how to set up fixtures prepare store and merchandise. Now most large retailers who are growing have key resources and select teams who traveled to do this. However, doesn't make any sense for retailers to hire people all over the country, when they are opening stores in specific locations.

They will keep a small concentration of resources but they look for experience merchandising partners to scale. As a result, they have been turning to SPAR for help with our decades of experience working in stores to merchandise, set categories and promotions. Combined with our national reach, we are perfectly positioned to support new store openings.

While that is more than enough work to scale a large business there's a constant flow of store renovation work going on at the same time. Retailers are constantly renovating. Let me frame this as an experience to retail executives.

There's a general rule of thumb in retail that you should touch the store every five to seven years, you've all seen stores that have gone too long without care. When you allow the store to get run down, customers stop coming becomes self-fulfilling. As a result you need to be constantly caring for and investing in your stores.

Within this five-to-seven-year window, you typically have three tiers of renovation. The first tier is moving categories around painting, replacing carpet tiles, perhaps changing out some lighting. I'm confident you've walked into the store and noticed this type of activity.

We provide the resources to move categories of product in the store set new end caps and promotional fixtures, sometimes move product at night for the general contractor and then move it back before the store opens in the morning. The second tier is a little more significant.

You might close the store for a few weeks while you're installing the fixtures, polish the concrete floor, add coolers, change out the HVAC unit et cetera. You've seen this with signs in the winter that say we'll be back soon or visit us at our store down the street signs.

Again more opportunities for SPAR with our ability to provide teams of resources with experience to ensure the store closure is as brief as possible. The third tier is when the retailer wants to move this store or remodel it bottom to top.

While this seems extreme for most retailers a fully renovated store, even if it hasn't moved address positive comparable sales within the first few months. The return on investment is generally strong.

This example, we provide teams of people for several weeks at a time in all parts of the country to hit the dates and help our clients open the most compelling and successful store possible are involved in setting fixtures, signage, product displays and repairing was anything that is not screwed down.

I noted in my second quarter comments that we also successfully launched this capability in Canada in 2022. Within the first six months of launching this service in Canada, we have been awarded several million dollars of new work began working with two new large clients.

Our only constraint to grow this piece of business is access to labor because the teams travel to sites, stay for periods of time and this requires time to develop skills. We've invested in recruiting resources dedicated to identifying this future SPAR team member.

Our track record to-date has been quite good and we are tracking our contact to higher conversion rate weekly to ensure we are attracting the right talent and leveraging all of the appropriate technology. As an experienced retail executive, I am pleased to see the consumer returning to the stores.

But as you know, supporting online is also important and this is part of our work at SPAR. We announced our intent to provide resources to support distribution centers last year. The intent was two-fold. First, it would provide demand for SPAR resources during the fourth quarter, which is typically slower in stores than the rest of the year.

Second, it would engage far more deeply based on our strengths in the growth of online retailing. They shared last quarter this has begun to bear fruit. I'm pleased to say that we now have more than 200 people working in distribution centers to help fulfill online orders retailers for this holiday season.

In addition to providing resources in distribution center to support online order, picking, we continue to test access to crowdsourced images and artificial intelligence with our clients. We believe our role is to innovate, test and learn and stay ahead of the marketplace. This is deep rooted in our culture.

And let me make a few comments about our pipeline and opportunities. As I noted earlier, we are not seeing a softening of the business. We closed eight multimillion dollar deals in the third quarter, in addition to many other million dollar or smaller contracts.

A typical profile for one of these large agreements as either replacing a competitor and providing in-store merchandising across the geography, we're assuming responsibilities for a number of store models.

Beyond the three-quarter results, we have several active multimillion dollar opportunities in our pipeline across the U.S., Brazil, South Africa, and Mexico. The health of our pipeline also reflects our improved ability to expand client relationships across borders. This is something that is unique to SPAR in our marketplace.

We closed more than $10 million of new business in the third quarter as a direct result of our quality of service and relationship in one country. It seated the opportunity and another. In one example we traveled a team to a second country to train and develop the capabilities and earn the right to perform more work going forward.

This type of global engagement is a differentiator for us. I traveled in the third quarter to Japan, Canada and South Africa in every country executives want to learn best practice and capture ideas from other parts of the world. This is inside SPAR can bring the prospects and clients unlike any other business.

As you may know, I have held international retail roles, built international services business and I'm constantly learning from global markets. The technology and ideas in Japan are different than those in the U.S. The multi-layered ecosystem of retail in South Africa forces you to rethink about merchandising differently.

These learnings and insights we glean from our global footprint give us an advantage in the market. While we experienced fluctuations in our financials from exchange rate variances. my view is this is a small price to pay for access to new ideas, insights and processes that can help SPAR win on behalf of all of our shareholders and constituents.

An area where we have aggressively leaned into this is retail analytics. We've invested in resources offshore through our India business to expand our business insights and analytics offering. We've taken lessons learned from the best brands retailers in the world.

We're capturing data from every visit to provide insights to opportunities and performance challenges for our clients. These resources support our business and clients in multiple countries.

We also believe that application of artificial intelligence over the 14 million pictures we capture each year is important provides previously impossible insights. We began with our partner ParallelDots earlier this year to apply image recognition.

We now have expanded this by applying AI tools on top of our SPAR view images to sell broader business challenges. This is just the beginning of our expanded analytics and insights work we have much more to come.

I have said before that our business isn't recession proof but when retailing consumer goods, brand manufacturers are under pressure, we are potentially relieved out. They can reduce the full-time expense in their P&L and look for a partner like SPAR to leverage while maintaining a high level of service and excellent execution.

We are privileged to work with some of the best companies in the world such as Dollar Tree, Walmart, [indiscernible] Keizer, Motorola, Motorola, Cargill, McKesson, Advance Auto, P&G, and many, many more.

We aspire to earn more of their business while winning new clients and pursuing a long-term vision to be the most creative, energizing and effective merchandising, marketing, distributing distribution services business on the planet. Let me wrap up my comments by thanking our team and recognizing their dedication and commitment each day.

I'm grateful that I get to work with this incredible group of people and look forward to a bright future together. With that, I'd like to open the lineup for questions.

Operator?.

We will now begin the question-and-answer session. [Operator Instructions]. And our first question will come from Theodore O'Neill of Litchfield Hills research. Please go ahead..

Thank you very much. My first question is about revenue in the Americas. It looks like it's accelerating a little bit, your year-over-year comparisons in Q1 was down 4.9% then it was up 3.9% in the second quarter, now it's up 7.8% in the third quarter.

Are there market share gains going on there? Or is this just comparisons to COVID periods that were artificially lower?.

First of all, good morning, Theodore. Thank you for the question. It's a little bit of both. So as you would expect early in 2021, we were still coming out of some of the COVID impact. It slowed, I think fundamentally everyone in our space in 2020 and then extended into the early 2021 period.

However, we really feel quite bullish about the new contracts we're winning, and extensions decline agreements. So we already have. So my sense is particularly in Brazil, the U.S. and Canada, in the last six months, we have begun to take share from competitors and are winning some deals that are really exciting for us.

And I hope to see that continue for another several quarters..

Okay.

My next question is on the input side, are you seeing any inflationary impacts or COVID lockdowns in China that are having an impact on the day-to-day business?.

We've continued to see this third quarter impact from COVID lockdowns in China and continued impact and more than expected actually in the third quarter in Japan. Again, these are not large bottom-line contributors, fundamentally to the business.

But Japan, as you'll look in the country, data was off on revenue before you deal with the exchange rate 27%, I think it was down. There are sort of restrictions to meetings you can have and restrictions about people going into stores and doing merchandising work in Japan and throughout the country.

China's continued to maintain a zero-tolerance policy and it has had impact on our bottom or EBIT, so if you look at the consolidated operating income for the impact of EBIT from China was about [304,000] [ph].

So, we're still looking at that carefully the potential long-term impact of that over our business and make sure that we're doing everything we can for the merchandisers as well as the business and shareholders. I don't think we're through all of that yet, Theo. I think China's policy remains the same.

I think the highlight for us, though, is that it's a small and material piece of the bottom-line..

Okay. My last question is about the SG&A increases that were primarily due to increase marketing and non-capital IT investments, as well as consulting and board-related fees here in your prepared remarks.

Is that going to continue into Q4?.

Yes. Thank you for bringing that up. Probably could have been stated in reverse order, the fees related to the strategic alternative process that involves I mentioned consulting and accounting and a number of other things.

Frankly, we were a significant impact on our SG&A in the third quarter, I expect some of those to continue in the fourth quarter, but it was more material in the third quarter than I think we'll see in the fourth..

Okay, thanks very much..

Thanks, Theo..

Next question comes from [Michael Cae of CAE Associates] [ph]. Please go ahead..

Yes. Thank you. Unless I'm mistaken. When I looked into your balance sheet, it seems as the current assets and current liabilities are about the same? Doesn't that put the company in precarious financially? Maybe you could elaborate..

Michael, good morning. I’m not sure, I'm clear on your question..

On your balance sheet, it says current liabilities and current assets. They seem to be more or less the same.

But I would think that would put the company in a precarious position financially or somewhat?.

Well, I'll come in for a moment, then Fay maybe I could ask you to comment more specifically, to Michael's point. I feel quite comfortable with the company's financial position at the moment.

We run on a revolver on an ABL with a receivable and the more we grow, the more it may appear that way on the balance sheet, but that's actually healthy for us over time.

But Fay can you comment, maybe -- make sure Michael's question be best we can as answer?.

Yes, of course. So on the prepay side, the increase is driven by the Brazil tax provision, as you can see in the income as well. As Mike mentioned that Brazil has been very profitable. So the tax provision is higher than what we're seeing. And that's now got posted into the asset.

Now, on the accrual liability side, it's actually a function of accounting changes as you recall last year, we have book of $4.5 million of the change in control agreement, and it reclass got down to the paying capital, so it's more of a non-cash balance sheet movement, then the cash itself.

And kind of to Mike's point, we're not concerning over the cash position that we're in today..

Okay, that's helpful. Thank you. The other question is, it seems that there's not that much competition in terms of what SPAR does. And you're all over the world. You got tremendous expertise, and good insights into the retailing market and situation.

Are you doing anything to make the company and what it's doing more known to the Wall Street Community?.

Michael, certainly to the Wall Street Community beginning on after we resolved our issue and Fay just referred to the CIC in January 25. We put out an 8-K to explain that resolution. I and Fay, have been very active with our Investor Relations partner, talking one-on-one with investors.

We've been to investor conferences and have been doing as much as we can to get continued visibility of the company to Wall Street. We will continue to do that..

Okay. Maybe when the numbers improve further, that will be helpful too..

Thank you. Yes..

Thank you. Bye-bye..

The next question comes from Maj Soueidan of Geoinvesting.com. Please go ahead..

Hi, guys. Thanks for taking the question here. I have one quick question. You talked about signing up some multiple deal -- multibillion dollar deals in the quarter. I like to understand how that relationship works overtime.

Do you book revenue right away? Does that revenue come in a future quarters? So maybe you could help maybe shed some color on how that works?.

Yes, absolutely. Thanks for your question. Good morning. It is the agreements we signed to commitment for typically one, two, or occasionally three years’ time, which allows us to engage or hire, if we don't already have them, or share them in a syndicated ways the resources we have, but then the revenue comes quarter-after-quarter from there.

So we earn it each quarter. And occasionally it can grow in size. But typically, the contracts are nevertheless than what we have originally agreed to and that revenue we generate..

Great, thanks. So the contract you signed this quarter haven't hit any income statement yet? Though you are coming in [indiscernible]..

That's correct..

All right. Thank you..

You are welcome. And let me -- I'll add something to that, too by the way, some of the agreements we've been signing recently are actually -- will begin to really materialize in 2023. So more to come..

Okay. Thanks for answering..

You're welcome. Good morning, again..

This concludes our question-and-answer session. I would like to turn the conference back over to Michael Matacunas for any closing remarks..

Operator, thank you, again for not slaughtering my last name as most people do. At the conclusion, I just want to thank everybody for your interest in the company and listening to earnings conference call today. I look forward to providing an update of our progress when we report fourth quarter results after the first of the year. Thank you again..

The conference has now concluded. Thank you for attending today's presentation and you may know disconnect..