Ladies and gentlemen, thank you for standing by. Welcome to the SS&C Technologies Q1 2023 Earnings Call. Today's call is being recorded and all lines have been placed on mute to prevent any background noise. After the speakers’ remarks, there will be a question-and-answer session. [Operator Instructions] Thank you.

It is now my pleasure to turn today’s call over to Justine Stone, Head of Investor Relations. Please go ahead..

Hi everyone. Thank you for joining us for our Q1 2023 earnings call. I am Justine Stone, Head of Investor Relations for SS&C. On the call with me today is Bill Stone, Chairman and Chief Executive Officer; Rahul Kanwar, President and Chief Operating Officer; and Patrick Pedonti, our Chief Financial Officer.

Before we get started, we need to review the Safe Harbor statement. Please note the various remarks we make today about future expectations, plans, and prospects including the financial outlook we provide constitute forward-looking statements for the purposes of the Safe Harbor provisions under the Private Securities Litigation Reform Act of 1995.

Actual results may differ materially from those indicated by these forward-looking statements as a result of various important factors, including those discussed in the Risk Factors section of our most recent annual report on Form 10-K, which is on file with the SEC and can also be accessed on our website.

These forward-looking statements represent our expectations only as of today, April 27th, 2023. While the company may elect to update these forward-looking statements, it specifically disclaims any obligation to do so. During today’s call, we will be referring to certain non-GAAP financial measures.

A reconciliation of these non-GAAP financial to comparable GAAP financial measures is included in today’s earnings release, which is located in the Investor Relations section of our website at www.ssctech.com. I will now turn the call over to Bill..

Thanks Justine and thanks everyone for joining. We started 2023 with pretty strong revenues growing $1.363 billion and adjusted revenue up 5.2%, and our adjusted diluted earnings per share, while a little soft to $1.11 was within our range and was down 11.2% from last year.

Rising interest rates obviously impacted our earnings, but we're in very good shape from a financial standpoint. We had a lot of inflation, too, especially in wages, and that also put some pressure on our bottom-line. Adjusted consolidated EBITDA was over $500 million again at $509 million, and our EBITDA margin was 37.3%.

First quarter with all the payroll taxes and health care expenses is normally the highest expense quarter we have. But we do expect to begin to see a lot of cost savings from our Blue Prism digital worker deployment. We believe the digital workers will drive margins and serve as a hedge against inflation.

We currently have over 40 processes live and are on track to achieve our 2023 productivity goal. Our first quarter adjusted organic revenue was up 1.9. We saw good performance in alternatives in our global investor and distribution services business, retirement and our Institutional and Investment Manager segment.

We generated net cash from operating activities of $254.8 million for the three months ended March 31, up 38.9% over the same period last year. We paid down $44.6 million in debt in Q1, bringing our consolidated net leverage ratio to 3.38 and our new -- our net secured leverage ratio 2.39 times of consolidated EBITDA.

In Q1, SS&C bought back 2.3 million shares for $134.7 million at an average price of $59.9 and program to date treasury stock buybacks of $439.9 million for purchases of 7.8 million shares at average price of $56.34. We'll continue to target 50% of our cash flow to stock buybacks and 50% to pay down.

We still look at lots of M&A while it remains disciplined, and we have yet to see any movement on large-scale assets, although we did see the German force, putting in a bid for SimCorp today. We do think we'll have opportunity for some tuck-in acquisitions before the end of the year.

This April marks the fifth anniversary of the DST acquisition, which brought SS&C over $2 billion in revenue and a long list of large sophisticated clients. While we have doubled the profitability, accelerating their revenue growth, took investments in the product, the service and the leadership teams.

We feel these investments are paying off, and our biggest prospects are currently in our GIDS and retirement businesses. We have all watched volatility in the financial services sector, particularly US banking over the past few months. SS&C is a strongly diversified company. We have seen limited impact to-date.

As always, we will support our customers monitor the situation closely and react as necessary. I'll now turn it over to Rahul to discuss the quarter in more detail..

Thanks Bill. Our business remains strong despite a volatile macroeconomic backdrop with several of our business units improving their competitive positioning. Our alternatives fund administration business posted 6.6% growth in Q1 and now has assets under administration of $2.24 trillion.

GIDS, which serves the world's largest asset managers grew 3.6% this quarter. We've invested heavily in the leadership technology and service organization of this business over the last five years and continue to do so. We won large customers over the past few years and entered into long-term contract renewals with others.

These marquee names, including St. James Place, Capital Group, Brooks McDonald, JPMorgan, Van land, and most recently, Mind Super provide a solid foundation from which to continue to grow.

We have prioritized innovation and are working on dozens of new products and services across the company, whether it be SS&C BrightLine for tax, SS&C Everywhere for data connectivity and Insights, or SS&C Private Cloud for a purpose-built compute solution, these products solve important issues for our customers give our employees creative ways in which to add value and strengthen our business.

I'll mention some of the key deals for Q1.

A large UK wealth client embarked on a strategic project to move their international accounts to SS&C's Bluedoor platform, an alternative asset manager chose SOMS and fixed link services after a comprehensive RFP process, a $30 billion in AUM, private equity and real estate firm chose us and fund services, a current brokerage client chose SS&C's All Serve solution to help scale and expand the clients offering in the alternatives market, an $80 billion real estate manager with a non-traded REIT shows the suite of SS&C's fund services and retail all transfer agency services.

We'll now turn it over to Patrick to run through the financials..

Thanks. Results for the first quarter were GAAP revenues of $1.327 million; GAAP net income of $126 million, and GAAP diluted earnings per share of $0.49. Adjusted revenues were $1.634 billion. Adjusted revenues were up 5.2%.

Adjusted operating income decreased 1.1% and adjusted diluted EPS was $1.11, 11.2% decrease over Q1 2022 due to the impact of higher interest rates on our debt. Adjusted revenue increased $67.2 million or 5.2%. Our acquisitions contributed $64 million. Foreign exchange had an unfavorable impact of $19.9 million or 1.5%.

Adjusted organic revenue increase on a constant currency basis was 1.9%. We had strength in several product lines, including alternatives against transfer agency services business and institutional investment management business.

Adjusted operating income for the quarter was $493 million, a decrease of $5.7 million or 1.1% from the first quarter of 2022. Adjusted operating margins were 36.2% in the first quarter compared to 38.5% in the first quarter of 2022. Excluding acquisitions, expenses increased 5% on a constant currency basis.

Acquisitions added $52 million in expenses and foreign currency decreased cost by $19.6 million. Our cost structure has been impacted by general inflation, wage inflation and increase in business travel compared to 2022. Adjusted EBITDA was $509 million or 37.3% of adjusted revenue, a decrease of $5.9 million from Q2 2022.

Net interest expense for the quarter was $111.9 million, an increase of $62.6 million or 127% from Q1 2022. In Q1 2023, net interest expense includes $3.5 million of noncash amortized financing costs and OID.

The average interest rate in the quarter for the amended credit facility, including our senior notes, was 6.21% compared to 3.11% in the first quarter of 2022. We recorded a GAAP tax provision of $52.5 million or 29% of pre-tax income.

Adjusted net income was $284.4 million and adjusted EPS was $1.11, and the effective tax rate used for adjusted net income was 26%. Diluted shares increased to 257 million from 256.4 million in Q4. The higher average stock price partially -- was partially offset by share repurchases during the quarter. On cash flow and balance sheet.

We ended the first quarter with $433.3 million of cash and cash equivalents and $7.1 billion of gross debt. SS&C's net debt, which excludes cash and cash equivalents of $130.2 million that are held at DomaniRx, was $6.8 billion as of March 31st.

Operating cash flow for the three months was $254.8 million, $1.3 million increase from the same period in 2022. Some highlights on cash flow for the three months. We bought back treasury stock for $134.7 million and repurchased 2.3 million shares at an average price of $59.19.

In July 2022, the Board authorized the new stock repurchase program of up to $1 billion in stock buybacks. Program to date, treasury stock buybacks are $439.9 million for purchases of 7.8 million shares at an average price of $56.34. Net debt payments in the quarter were $44.6 million.

And we paid total of interest of $138 million in the quarter compared to $74.2 million in 2022. On income taxes, in the quarter, we paid $20.9 million compared to $42 million in the first quarter of 2022. Our accounts receivable DSO was 53.5 days as of March 31st compared to 52.3 days as of March -- as of December 2022 and 52.7 days as of March 2022.

Capital expenditures and capitalized software was $53.1 million or 3.9% of adjusted revenue for the quarter. Spending was predominantly for capitalized software to investment in research and development and IT infrastructure.

Based on our net debt of approximately $6.8 billion, our total leverage was 3.38 times and our secured leverage was 2.39 times as of March 31st. On outlook for the year, first, I'll cover a few assumptions. We'll continue to focus on client service, and we expect retention rates to continue in the range of most recent results.

We have assumed foreign currency exchange will be at current levels for the remainder of the year. And as a result, organic growth for the year will be in the range of 2% to 6%, and adjusted organic growth for Q2 will be in the range of 0.5% to 3.5%.

We have assumed interest rates will increase in additional in the range of 35 to 50 bps through the remainder of the year compared to the average rate in the first quarter. We'll continue to manage our expenses during the period by controlling variable expenses and increased productivity to improve our operating margins.

We'll continue to allocate free cash flow to both debt pay down and stock buybacks, and we continue to expect the adjusted tax rate to be about 26%. So, for the second quarter of 2023, we expect revenue in the range of $1.3345 billion to $1.3745 billion.

Adjusted net income in the range of $276.5 million to $293 million, and diluted shares in the range of $256.5 million to $257.5 million. And for the full year, we expect revenue in the range of $5.455 billion to $5.655 billion.

Adjusted net income in the range of $1.190 billion to $1.285 billion and diluted shares in the range of 255 million to 258.5 million. And on cash from operating activities, we expect that to be in the range of $1.275 billion to $1.375 billion. And I'll turn it back over to Bill for final comments..

Thanks Patrick. We expect revenue accelerated in Q3, Q4, and we expect the growth to be broad-based across a lot of our different businesses and we will be able to convert a bunch of backlog revenue. We have price increases that have already gone into effect until the revenue will begin to tick up, and we also have a very full pipeline.

We have invested heavily in our product and service suite, and we remain excited about our opportunities. It's been a difficult way to get to here, but I think we're in really good shape going forward. And I'll now open it up for questions..

[Operator Instructions] Your first question comes from the line of Kevin McVeigh with Credit Suisse. Your line is open..

Great. Thanks so much and congratulations on the results. I look at the organic growth, it seems like it implies about 2% on average for the first half of the year and then the midpoint is 4% for the full year.

So, wondering maybe just -- is it the same buckets, pricing, new business backlog and new products that drive that? Or is there maybe just to ring-fence that a little bit with the incremental drivers or as we think about the back half of the year?.

Kevin, I think that's primarily what it is. I mean we have a number of large-scale deals that we have sold over the last two or three years. And it seemed like they're never going to come to fruition, but they are coming to fruition, and they're going live. And with that, it releases a lot of revenue into our financial statements.

And as I said, we still have full pipelines with goods, which is our -- primarily our transfer agency business growing 3.6% in the first quarter, that's quite a turnaround. And so I think we're making progress across all of those things, and I think that that's -- plus the price increases are also starting to take effect.

So, I think we're in reasonably good shape for the second half of 2023..

That's terrific. And then just one quick follow-up. It seems like the AUA was actually up sequentially, the first time about four quarters, and that's despite some disruption in your quarter across the markets.

Any thoughts around that? What's driving that?.

Rahul, do you want to take that?.

Sure. We had pretty good inflows into both our hedge fund and our private equity businesses during the course of the quarter. So it's a combination of new fund launches, some organic and performance-related growth in these clients as well as new client wins.

So, as you know, it's kind of the first time we've seen net uptick in a few quarters and -- but we're pretty happy about it. But we do expect to see based on the comments Bill just made about the strength of our pipeline, we're certainly seeing some momentum in the market..

And I would say I'd say also that we believe we remain the strongest competitor by somewhat. And I think that there is a lot of volatility in that market, and a lot of the larger scale investment managers prefer to have our steady hand. And I think that's played out pretty well for us..

Terrific. Thank you..

Your next question comes from the line of Dan Perlin with RBC Capital Markets. Your line is open..

Thanks. Good evening. Bill, I wanted to just take your temperature in terms of discussions that you've had with your clients. This is obviously true for Rahul as well. Kind of pre-SVB and post-SBB, you made it sound like there's not been any kind of fallout from that, and that's good to hear.

But I'm just wondering kind of the posturing of what they're saying. I understand you have a backlog and it's going to get converted to these large clients, which I think is encouraging for organic growth.

I'm just wondering where they sit today in kind of their readiness to release capital in order to drive new contracts with you guys?.

Yes. And as you noted, right, a lot of what we're expecting in the second half, we have already signed and are in the midst of bringing them live. So it's -- it is really a continuation of the last 12, 18, 24 months. And -- but there's a lot of skittishness in the financial markets, particularly the banking markets.

And while we don't have a huge client base and mid-level banks, we do have something. So, we're monitoring that as closely as we can. You do kind of see that whether it's Silicon Valley or First Republic or Signature that you're really kind of on the mid spot between traditional banking and financing venture capital and other investments.

So I'm not sure that the contagion is quite -- I don't think it's anything like 2008, 2009. And I think that's why it hasn't had much impact on us to-date. Of course, we'll watch it as closely as we can..

Yes. Just a quick follow-up on the -- I guess the commentary around digital workers you had in the release. It seems like you're reiterating this 1,300 to 2,700. Can you just remind us where that sits in terms of cost savings? I think we had allocated something like $65 million at the low end of that range for annualized cost savings.

But I just want to take your temperature on where we sit on that as well. Thank you..

No, I mean it's nail in the head, Dan, $65 million. We're estimating about 1,000 in savings as we deploy digital workers per worker. And knock on wood that's pretty much what we see. And in some cases, the improvement in productivity is drastic.

So we're very optimistic that if we keep our nose the grindstone and build great digital workers, we'll have a great outcome. So, that's what people are focused on..

Excellent. Thank you, Bill..

Your next question comes from the line of Andrew Schmidt with Citi. Your line is open..

Hey Bill, Rahul, Patrick. Thanks for taking my questions. I want to ask about the GIDS business. Maybe just talk about just the nature of the investments and what you're doing there. That would be helpful. And then the 3.6% growth, the positive flip much better than we were anticipating.

Could you just sort of disaggregate that and maybe talk about the drivers there, whether it's existing client growth, new client launches, things like that. Just curious to understand the drivers a little bit more there..

Well, we named as a global investor and distribution systems and it's the largest investment managers in the world use that service, then -- we always felt that if you could deliver a better interface to better client interaction with the system and really had good process and procedures that there was opportunity all over the place because we didn't think our competitors would do the same thing.

And while it might have taken us a little longer than we had hoped, we do think that we have built some purpose-built software that is easier to use and is getting much more client satisfaction. And then we've had any number of large-scale wins and large-scale renewals that has really helped the revenue side.

I don't know if, Rahul, do you have anything else to add to that?.

Just on the investments. The investments have been kind of in really all aspects of that business. So, we have invested heavily in the technology to the point Bill just made, digital interface, web interface, mobile apps, just workflow and systems. We have also brought in a lot of sales talent, a lot of management talent.

And I think that the key to all of this is that the large clients that we have won over the last six, nine months, we've kind of worked through that implementation process and they're coming live, and that's helping our numbers..

Got it. Thank you for that. And then a question on the just -- I think, Patrick, you mentioned just wage inflation. I just wanted to drill down on that a little bit. Is that more of a flow-through effect from actions you took last year? Or are you seeing something more recently that's exacerbating wage issue.

Just want to be clear in terms of what you're seeing about the cost of labor environment?.

Yes, it is mostly actions we took post April 2022 that are impacting us in Q1 when you compare it to prior years. But we're seeing in the current year, wage inflation slow down a little bit..

Perfect. Thanks so much guys. Appreciate the help..

Your next question comes from the line of Alex Kramm with UBS. Your line is open..

Yes, hey. Thanks everyone. Just -- maybe just as a follow-up for the question. It's just was just asked, but margins in the quarter certainly missed, I think Street expectations and our own. So, maybe we're just modeling it right.

But I know you just talked about the wage inflation, but was there something else that you hadn't expected in the quarter that surprised you? Or again, is it just the Street not thinking about it correctly, since you said the wage inflation should trade off in April? And then related to that, as we think about the remainder of the year, I guess, what gives you confidence that you can get that margin expansion that you had talked about on prior calls.

Is it just the Blue Prism I think that is really going to help the margins here? Or is there something else that you're working on to make sure margins are meeting your targets?.

Well, I think what the expense process was primarily, as Patrick said, the wage was from actions we took at the end of -- throughout 2022, really. And so I don't know that we were surprised as much as it all kind of came into the first quarter. And again, it's -- we're pretty confident on our ability to drive margins.

And yes, I think 37.3% on adjusted EBITDA bars down maybe 100, 200 basis points. But I don't think that's -- we're very confident in our margin driving capabilities.

And what we want to make sure we do is invest in the people and the processes and the capabilities to go get to $65 million to $130 million in savings through Blue Prism and then also constantly invest back in our products and services.

As Rahul said, we're really bringing out new things, whether it's BrightLine or GoCentral or SS&C Everywhere or all those kinds of things that we think differentiate us. And it's the reason that we win most of the platform business that is out to bid..

All right. Fair enough. And then maybe a little bit bigger picture. There's been in the last quarter, last six months, whatever you want to use, much more talk about AI, ChatGPT, et cetera. Just wondering how you view those capabilities in your own business.

I think some people are arguing like, you can -- you may be able to do a lot with that and maybe Blue Prism isn't that same kind of fear. But at the same time, I think there's others who say like, hey, this could actually be super disruptive to your business.

So, I know it's a big picture question for a call like this, but just wondering how much time you're spending on that and what you're evaluating?.

Well, Alex, I don't think that Fintech in general, has a very big moat. Almost anybody that's on this call can start a Fintech company. You need to be able to have an idea. You need to be able to have some development talent to be able to deliver a product.

Now, doing that and turning it into a $5.5 billion company with 100 offices in 40 countries and a suite of products and services that are pretty much world-class, that's a pretty big moat, so that when companies such as UBS or any of the other great big investment banks or any of the great big hedge fund platforms or private equity platforms or private hedge platforms or real estate organizations, this is pretty sophisticated, pretty regulated, pretty minutia, pretty detailed.

And I think that we've worked very hard to have the best people. We have the best training. We think we have the best solutions for our customers. And I think that we move quickly to buy Blue Prism.

We believe that this intelligent automation and its corollaries and AI and machine learning and natural language processing and the rest of it is what's going to happen and either you get in front of it or you're so far behind that pretty much you're on the block..

Fair enough. Thanks guys..

Your next question comes from the line of Peter Heckmann with D.A. Davidson. Your line is open..

Thank you. I have a quick one on DomaniRx.

Could you give us an update on the platform development there and whether or not you continue to think that -- you have a good shot at moving your one large processing customer to the new platform in 2023?.

Well, I think our target, set is $124 million -- and I think that we're in reasonable shape. I know that we have had some Domani Board meetings. I know Rahul has been too, and we do pretty much constant updates on that platform. And I would say we are cautiously optimistic.

Rahul, do you want to comment further?.

Bill, I think you got it. We're kind of on target with our development plans so far, and we're keeping a close on..

Okay, that's helpful. And then this is a follow-up.

I mean, how are you thinking about on the private equity, real estate, private asset side? How are you thinking about mark-to-markets there? Maybe just remind us how much of that part of the business relies on fixed minimums versus basis points?.

It's primarily basis points. There's some things that we do that are piece meal, whether that's K-1s and tax return type things and financial statements and -- but it's primarily a basis point charge..

Okay.

And so just in terms of how that's worked historically, I guess, is -- would you expect there to be a six-month, 12-month lag in terms of when asset values change and when they start to update those values? Or do they do it really more quarterly?.

Yes, I'd say quarterly..

Okay.

So we should be seeing it in the numbers already?.

Yes, I think so..

All right. Thank you..

Your next question comes from the line of Terry Tillman with Truist. Your line is open..

Hey guys, this is Joe Meares on for Terry. Thanks for taking the questions. The first one that I had is just I wanted to confirm that I heard correctly that organic growth in the quarter for revenue is 1.9%. And then just curious what financial services organic growth was in the first quarter. I think it was 1.3% last quarter.

So, just curious if there is any inflection there?.

You're right that the total organic growth was 1.9%. And when you're referring to financial services, I assume you're referring to ex-health care, right? And that was 2.5% in the quarter..

Okay, perfect. And then just as a follow-up there. I think last quarter, you had mentioned that your expectation for the health care market was for it to be down 10% in 2022.

Just curious if there's any change in expectations there?.

No, that's approximately what we expect..

Yes, 2023..

2023, right..

Perfect. Thanks so much guys, Appreciate it..

Your next question comes from the line of James Faucette with Morgan Stanley. Your line is open..

Great. Thank you very much. I want to touch quickly on M&A. In your prepared remarks you made reference to acquisition in Europe, SimCorp today.

Just wondering how you're thinking about valuations, what you're seeing in valuations, particularly it sounds like you're trying to get some things done between now and the end of the year and just basically -- you obviously built a lot of value over the years via acquisitions, just how you're thinking about that as an opportunity right now?.

Yes, James. I would say it's pretty similar. I mean everyone talks about that prices are maybe pausing and then it looks like at least the headline numbers on SimCorp is about 30 times EBITDA. So, it's not pausing very quickly, I would say.

So, all I think that there are assets that are going to be sold, I think the owners of those assets are going to have to, in general, take some haircuts and I don't know that they're ready to do that yet. I think SimCorp has kind of been on the market for a while. And I think maybe the Borse has some other assets that they want to put together.

And so I think that maybe was serendipitous for them. And I don't know exactly where are we with FIS, where are we with a few of the other assets that are out there. But some stuff ought to shake loose. And I think the more that people care about their customers, the better opportunity we have..

Got it. Got it. And then going back to looking at the second half ramp, it sounds like between some of the new contracts and pricing and some of the other things that you actually have pretty good line of sight into that acceleration. And it doesn't sound like you're really dependent too much on macro at least improving.

Just want to make sure that, that's -- I'm understanding that correctly and where there could be sensitivity if macro were to deteriorate a little between now and then?.

Yes, I think that's a pretty accurate characterization of where we are. I think the macro would have to deteriorate to the point where as someone said earlier, has it made it to where people are not going to allocate capital to new systems or new processes.

But as large-scale financial institutions get under pressure, often their way to control costs is to outsource. And that's really a pretty big strength of ours. And we have any number of large-scale conversations going on with very large mutation. So, we'll have our opportunities. It's like always, you got to execute..

Got it. Thanks a lot for those comment Bill..

Your next question comes from the line of Alex Kramm with UBS. Your line is open..

That was quick. Hello again. I just wanted to squeeze in a couple of follow-ups. One, and maybe you mentioned this, but I think you said pricing has been solid.

Can you be a little bit more specific what kind of pricing you've been realizing? And maybe you could actually say what businesses you're maybe realizing more or less than maybe what the company average is?.

I just think, Alex, that we're looking at between $100 million and $150 million in price increases realized in 2023 and probably the biggest ones are in alternative stand up and the goods business..

Okay, fantastic. Thanks for that. And just a very quick one here. Just from an understanding perspective, you gave those numbers that you have done 40 process automations now, and you also talked about the 1,300 to 2,700 people.

Can you just give us a little bit of a flavor like when you talk about these 40 processes, like how many people were you actually able to, I guess, reallocate or eliminate positions? And when -- and going forward, like again, like the 130 to 2,700, like how many processes is that I just trying to get a flavor for how many things you're automating and how many like per used case, how many people that it actually would affect?.

Yes, I mean it's a pretty broad rate, right? So, if we can build the digital worker to do pretty sophisticated reconciliations then we'll have all kinds of opportunities to deploy hundreds probably whereas in some of the other things, even things that are pretty broad scale, there's maybe not as many things done like validating 1065s and K1 tax returns or validating investment statements because one digital worker can do so much work, I don't really need to deploy that many.

So, it's more of one-to-many and many-to-many. And then it's not very often that you have to deploy many-to-one, but it is something that the capabilities of the individual digital worker, the sophistication of the process is what determines how many and how fast..

Okay, fair enough. Maybe I'll follow up there. And just very quickly, just to squeeze one in. On Blue Prism since we're on the topic, the 10.9% growth, that's been decelerating over the last few quarters. So, I think originally, when you bought the company, it was, I think, 15-plus maybe even in the 20s.

So is that a sales cycle thing? Or what's going on, on the external side with Blue Prism?.

No, we're optimistic that, that accelerates from the rest of the year, too..

Good enough answer. Thank you..

There are no further questions at this time. I will now turn the call back to Bill Stone for closing remarks..

Again, we really appreciate all of you coming on our call and we look forward to talking to you after the second quarter. Thank you..

Ladies and gentlemen, this concludes today's call. Thank you for your participation. You may now disconnect..