Good morning, ladies and gentlemen, and welcome to the Arcosa, Inc. Fourth Quarter and Full Year 2018 earnings conference call. My name is Bree, and I'll be your conference call coordinator today. As a reminder, today's call is being recorded. Now I would like to turn the call over to your host, Gail Peck, SVP, finance and treasurer for Arcosa. Ms.

Peck, you may begin..

Good morning, everyone. Thank you for joining our fourth quarter and full year 2018 earnings call. With me today are Antonio Carrillo, President and CEO; and Scott Beasley, CFO. The question-and-answer session will follow their prepared remarks.

A copy of yesterday's press release and a slide presentation for this morning's call are posted at our website, www.arcosa.com. You can access the presentation by going to the Events tab under the Investors section of the website. A replay of today's call will be available for the next two weeks.

Instructions for accessing the replay number are included in the press release. A replay of the webcast will be available for one year on our website. Today's comments and presentation slides contain financial measures that have not been prepared in accordance with generally accepted accounting principles.

Reconciliations of non-GAAP financial measures to the closest GAAP measure are included in the appendix of the slide presentation. Let me also remind you that today's conference call contains forward-looking statements as defined by the Private Securities Litigation Reform Act of 1995.

Forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from such forward-looking statements. Please refer to the Company's SEC filings, including its Form 10-K, that is expected to be filed later today for more information on these risks and uncertainties.

I would now like to turn the call over to Antonio..

Thank you, Gail. Good morning, everyone, and thank you for joining us to review our fourth quarter results and the outlook for 2019. I will begin my comments with Slide No. 4. The fourth quarter was an exciting and productive time for us. Arcosa became an independent public company on November 1.

On December 5, we closed a sizable acquisition that scales our Construction Products Group. We also divested two small business units in which we did not believe we could be competitive, and our fourth quarter financials reflected year-over-year improvement across key metrics.

Additionally, as we look ahead, we're seeing positive trends in several of our businesses that support our confidence in Arcosa's growth prospects. Arcosa entered the public markets positioned for growth. We have a very strong balance sheet providing the resources to fund future expansion.

We have a hand-picked management team that has a history of working well together and that is focused and incentivized. And we are operating with a lean corporate structure that gives us the flexibility to capitalize on growth opportunities.

Thanks to those attributes, we have been able to hit the ground running, executing on several of our strategic priorities, which are shown on Slide No. 5. First, we move forward on the goal of growing Construction Products with the December acquisition of Oklahoma-based ACG Materials.

This is a company that we know well, and the transaction has been strategically important in several ways. It adds significant scale to both the Specialty Materials and the aggregates businesses, transforming each of them into competitive growth platforms. It gives us further end market and geographic diversification.

It brings technical expertise in Specialty Materials applications that we can leverage in other parts of our businesses, and we have an active pipeline of bolt-on acquisition opportunities that we are currently exploring. On Slide No. 6, we included the information that we provided at the time of the ACG acquisition.

It is important to emphasize the geographic and end market diversity that ACG brings to Arcosa. As we spend more time with the ACG management team, it is very clear that their Specialty Materials expertise creates products with high barriers to entry, as well as long-term relationship with customers.

It is also exciting to see the entrepreneurial spirit that the ACG team brings to the table. The integration is going very well, and I'm convinced that ACG will be a great addition to Arcosa. Going back to the first stage priorities on Slide No.

7, in the Energy Equipment segment, we have taken actions that are expected to improve margins, applying lean manufacturing processes to our utility structure business and restructuring our Mexican operations. While a few months do not make a trend, I am encouraged, as we start 2019, by the early signs of progress we are seeing.

The new management team in the transmission business has taken positive actions. Mexico is in the middle of a nice turnaround, and our storage tank business is building momentum.

This progress is taking place, thanks to the enhanced focus on the Energy Equipment business as part of Arcosa, a renewed management team and a culture of performance and accountability we're building, and that is reflected in our compensation structure. I look forward to sharing with you the details on our progress.

In the transportation segment, we continue to capitalize on the ongoing market recovery in the barge business and increased demand for railcar components. In the fourth quarter, we announced the reopening of our barge facility in Madisonville, Louisiana.

This plant is on track to deliver its first barge in the middle of this year, and we are encouraged by the level of quoting activity that's under way. At the same time, in the rail components business, we're seeing early signs of success in expanding our customer base.

We're starting to win trial orders for some of our components from customers that would not have bought from us even if we're still part of Trinity. Lastly, as a new company, we have the ability to create a new corporate culture.

Over the last several months, we have significantly flattened the organization, managing with a small corporate office that enables past decision-making and leads to a very agile organization that can react quickly to changing market dynamics.

We're pleased with the progress that we have made over the past several months on each of our stage one priorities, while at the same time producing fourth quarter results that reflect positive momentum heading into 2019.

Our performance in the fourth quarter demonstrated the benefits of serving multiple infrastructure markets, as contributions from the transportation and energy segments more than offset the impact of challenging weather conditions on the construction products segment.

Moving into the outlook for 2019, which is found on Slide number 8, this will be Arcosa's first full year of operations, and the midpoint of our consolidated EBITDA guidance range for 2019 represents 18% growth compared to 2018.

Keep in mind this is after absorbing additional costs tied to public company expenses and lower pricing on some rail component supply agreements. We expect 2019 growth to be driven by all three Arcosa business segments.

In construction, market conditions heading into 2019 look favorable, with expanded state and local government budgets for infrastructure spending and strength in the private sector as well. We believe Arcosa Construction Products business is well-positioned in high-growth areas.

As we have discussed in the past, we are facing additional competition in some of our core natural aggregates regions which is normal. And we expect to continue to have strong margins which are more in line with our industry peers. At the same time, we will have the full year benefit of the ACG acquisition.

And as I mentioned earlier, ACG brought with it an attractive pipeline of potential bolt-on acquisitions. We would be very disappointed if we did not complete at least one by the end of this year.

We believe that Arcosa has a competitive advantage in making accretive acquisitions in this space as we can target smaller candidates and can offer them a level of independence and support that is not efficient for the very large industry players. In the Energy Equipment market, conditions are more mixed, but look promising overall for 2019.

In wind towers, our backlog is solid, giving us good visibility for the next couple of years. We were pleased to receive an order for $38 million in the fourth quarter for delivery in 2019. But as we approach the end of the phaseout of the production tax credit, there is uncertainty in the market.

The trends toward clean energy continue to be strong, and wind is now a competitive energy source on its own merit. So the fundamentals for the industry are strong in the long term, but the industry will have to learn how to operate within a different market environment.

In the utility structures business, quotation activity is steady, reflecting solid demand for steel posts and lattice towers. Here, though, our focus is on margin expansion through manufacturing and operating efficiencies. As I mentioned earlier, we're seeing some early signs of success in this business.

This gives us confidence that we are on the right track. And the storage tank business backlogs are up, driven by strong demand from residential, commercial and agricultural customers and then narrowly about significant pickup in our Mexican operations.

There is no question that fuel shortages in Mexico require additional storage and transport capacity, and we believe Arcosa is well-positioned to take advantage of this new source of demand.

Now to transportation, where market recovery sent in our barge business continue to materialize, underpinning our confidence in this segment's expected 2019 EBITDA growth. Our customers, the barge operators, have seen higher spot rates as demand builds.

And at the end of the fourth quarter, we had a book-to-bill ratio of 1.4, the fourth consecutive quarter above one. As the largest barge manufacturer in the country, we are preparing to be in the right position to capitalize on a cyclical turnaround in this market.

Additionally, our rail components business has benefited from the current high backlog levels for the North American railcars, and the fact that as an independent company, we are in a position to significantly expand our customer base.

In summary, we are very enthusiastic about the positive trends in our businesses and confident in the ability of our operating groups to execute on growth and margin expansion opportunities in their sectors. I will now turn over the call to Scott Beasley, our CFO, for a financial review.

Scott?.

organic investments, acquisitions and return of capital to shareholders. During the fourth quarter, we made progress on all three fronts. Our largest use of capital in 2018 went toward acquisitions, where we deployed $333 million primarily on ACG. We are following the disciplined capital allocation process that I discussed at Investor Day.

ACG is an example of our strategy to use acquisitions to improve our overall return on invested capital.

We paid roughly 10 times EBITDA multiple for the business, but we expect to follow it up with lower, multiple bolt-on acquisitions, high-return organic investments to expand capacity and add new specialty products and participation in strong specialty end market growth.

We expect it to be a solid platform that improves our long-term returns on invested capital. Turning to return of capital to shareholders, we repurchased roughly $3 million worth of shares in December at an average price of $24 per share, leaving approximately $47 million under our current authorization.

We also initiated a quarterly dividend of $0.05 per share that was paid in January. We see both our dividend and buyback authorization as valuable tools to return capital to shareholders. I'll now turn the call back over to Antonio for a few closing remarks..

Thank you, Scott. In summary, I would just like to review Slide 16, the long-term vision that we have for Arcosa and that we spoke about on our Investor Day in October and in subsequent investor conference and events.

First, while our focus remains on stage one priorities, we continue to work toward making progress on our long-term vision, which includes growing in attractive markets, where we can have sustainable competitive advantages; reducing the cyclicality and complexity of Arcosa; and improving our long-term returns on invested capital.

I would like to add one more, and that is developing and implementing ESG programs across the entire organization. We are about to embark on an ESG materiality study that will help us understand our different stakeholders' view around D&C priorities in the different business.

With this understanding, we will be able to make – we will be able to develop our sustainability framework and set specific goals for each one of our priorities. We are in the early stages in this process, but we wanted investors to know that this will be a priority for us going forward.

And to close, I want to recognize the tremendous accomplishments of the Arcosa corporate operating teams in getting us where we are today. Four months ago, we were a fragmented group within a large company. Today, we're an independent publicly traded company we've defined for our groups that are all pulling in the same direction, up.

This has taken an incredible effort on the part of all the people at Arcosa, and I'm proud to lead such a professional and hard-working group of individuals. Operator, now I would like to turn the call over for questions. .

[Operator instructions] And our first question will come from Craig Bibb with CJS Securities. Please go ahead..

Hey, guys. Good start to being a public company. I was hoping to get more details on the ACG acquisition. Obviously, the regular ag business, I would think most investors understand pretty well. But they have some real niche Specialty Materials operations.

Could you kind of walk through on maybe not on all of them, but the ones that are most interesting, and kind of the drivers of demand there?.

Craig, this Antonio. If you look at Page 6 in the presentation that we have, you can see that we have, it has different niche markets, as you call them. So, let me walk through some of them.

On the energy infrastructure, they have mines, both in the Texas and Oklahoma mainly focused on the drilling platforms and selling material for roads and for drilling pads and all the infrastructure required around fracking, no sand for fracking, but just infrastructure around that type of activity in Texas and Oklahoma.

And it's an interesting platform because it's also movable infrastructure. So as different regions in the states are developed, they can move around their infrastructure to follow those projects. So it's an interesting activity. On the agricultural side, they have two sides to it.

One is they sell some of their gypsum directly for agricultural uses, fertilizer and other applications, and they also make something called prills, which is a combination of gypsum with other materials that they have formulations for that serve for different types of crops and activities related to the agriculture.

On the building products, they sell gypsum materials for flooring. And to give you a sense of what they do, each one of their quarries has different chemical and mechanical properties.

And they have a very interesting lab, where they process the gypsum and add all sorts of additives to create the properties that specific customers require, and they also sell a significant amount of plasters in some of their products. So they have two sides of the, let's say, of the equation.

They have their mines, where they sell directly to traditional infrastructure plays, but they also use their own mining – let's say, proceeds or the material coming from their mines to process and add value and sell into different niche applications. I hope I gave you some sense of what they're doing..

Any other niche applications more attractive than the others or especially attractive? And is that where we'll see the bolt-on deals?.

I think most of the applications are attractive. I think they have – if you look at the regions where they are, each one of the mines is set up for different applications. So the West is more an agricultural play. On Texas and Oklahoma, it's more an energy play.

But I think that's one of the things that we like about the company, that they have this expertise of, let's say, setting a foot on in one specific market and then expanding the applications in that region. So that's what we're looking forward with them on buying some bolt-on acquisitions in the regions and also expanding those niche capacities..

Okay. And then I'll turn it over after this question, but wind towers, I thought it was reassuring that you were able to pick up a large new order at the end of last year. So you have a big backlog there to work through.

At what point will you start to see orders and have kind of better certainty of how this plays out after the production tax credits burned off?.

Well, I think that's a good question. As you know, the production tax credits has been winding down for the last few years. And if you look at the wind industry, even with a much smaller production tax credit last year, there was significant orders in the industry.

And that's why I think, as I mentioned in my remarks, wind is already a competitive source of energy on its own merit. But people are starting to figure out how to work in this new environment and what will happen when there's no production tax credits. So I don't want to give you a sense of timing yet.

I think we are positive on the long-term outlook of the industry. And we have a good backlog to, let's say, carry us through this time of uncertainty until we have more clarity on when the orders will start coming in..

Okay, I’ll get back in the queue. Thanks..

Our next question will come from Bascome Majors with Susquehanna. Please go ahead..

Thanks for taking my question, guys, and congrats on a positive and constructive outlook here. Scott, I wanted to follow up a little bit on some of your commentary around the cadence of EBITDA during the year.

Clearly, there are some unique headwinds to the first quarter, but you're pretty optimistic about the pace of growth in the second, third and fourth.

And I know, seasonally, normal situation would be that 2Q and 3Q would be much stronger than 1Q and 4Q, but you've also got this sequential ramping up in your barge business that starts and maybe can you kind of talk through the other quarters' seasonality, directionally at least, one by one, and give us in some sense of how the barge ramp's positive contribution plays with the normal kind of negative 1Q, 4Q contribution for the construction business seasonally?.

Yes. Bascome, thanks for the question. You're right. Let me take it segment by segment. So you're right. In Construction Products, seasonally, one and four are the lowest by far. And then in Q1, we had the difficult comp with pricing in 2018. So I think you're on the mark there. In Transportation Products, you will see a pretty big ramp-up through the year.

Q1 will be the lowest, but you'll see a pretty significant ramp-up in Q2, three and four, and it should accelerate through that year with each quarter improving sequentially. And then in Energy Equipment, roughly flat for the year. We said the Q1 comp will be a challenge because of the strength of Q1 in 2018.

But with our backlog in wind towers, utility structures and the strong backlog in storage tanks, we expect to be relatively consistent throughout the year in terms of revenue and in margin. As some of these margin improvement initiatives take hold, margin should likely improve a bit each quarter through the year..

And can you talk to us a little bit, I mean, the barge business running today, where it is, versus under Trinity $100 million plus in EBITDA, not that long ago? Can you talk a little bit about where you feel the exit rate for 2019 will be on that and what that suggests about the backlog you have to take and how you feel about 2020?.

Yes. That's another good question. So I think it's too early to tell exactly what 2020 looks like. We have a strong backlog that extends from 2019 and then some orders that are in 2020. We're still seeing how the dry bars market is shaping up. Like I said, steel prices are a bit of a restraining factor, but the inquiries are encouraging.

So if those trends continue, and if we continue the strong liquid barge increase in order levels, we should exit 2019 into 2020 at a much stronger rate than we have in Q1. The additional note, I'd say, we talked about very significant revenue growth year over year in the barge business.

We've had several quarters of 1.4, 1.5, some even two book to bill. So revenue should grow very significantly in the, call it, 70% to 80% range year over year. But margin will be slower.

We have the kind of two-margin headwinds of we'll be delivering orders in the first few quarters that we're taking in a weak pricing environment in early 2018, so that restrains margin a bit in the first half of the year.

And then secondly, we have the start-up costs related to, not only our reopened facility, but then the ramp-up of our other two operating facilities. So we should see margin improve sequentially throughout the year, but still not grow at the pace that revenue will grow for the year..

And last one for me, then I'll hand it off. Just kind of back of the envelope on your EBITDA cash taxes, working capital and CapEx guidance, it's looking like you kind of expect free cash flow to be maybe $100 million, even a little more this year.

Is that a fair assumption? Or is that – are we missing something in that math?.

No. I think that's a fair assumption. With the components that I described in my script, I think that that's the right neighborhood..

All right. Well, thank you very much..

Our next question will come from Brent Thielman with D.A. Davidson. Please go ahead..

Great. Good morning. Nice quarter. I want to follow up on the wind and utility side. It's obviously upbeat commentary, but I guess, your backlog's been under pressure relative to prior year.

I mean, are you nearing a point where you think that backlog is close to stabilizing? And is it your expectation that push in the business can grow in 2019?.

This is Antonio, Brent. Each one of our customers has different ways of managing their business. And the reason the backlog is coming down is we signed a large order a few years ago, and this order is covering our customers' needs for a certain period of time. We have other customers that place orders more on a project-by-project basis.

So I think the backlog is really not an indication of the industry itself at the moment, it's more an indication of different customers' ways of managing their business. And so I would say what I said before. I think what's important is, I think, that the industry is healthy. The industry has a – wind is a competitive energy source.

There is going to be additional orders placed in the industry, I'm sure, over the next years or so. And it will depend – but the industry's changing, and I'm not sure how the – our different customers will be placing orders if it's going to be based on long-term contracts, if it's going to be more on an order by project-by-project basis, etc.

So I think the backlog will depend more on that side than on the industry itself..

Okay. And then, Antonio, in your opening comments, you made some remarks regarding competitive issues you are seeing in the Construction Products Group.

Could you elaborate on that a little bit more?.

Yes. So if you go back in time, we were very concentrated in certain regions here in Texas. And that concentration in high-growth areas, as I mentioned, brings very, very, very attractive margins in some of our products. And that attracts competition, and that's why I said competition is normal and it's good. And we still have a great position.

We have good demand factors. We're in great regions, and the margins are going to be very good. They will be just, let's say, not abnormally high. They will be more like our industry peers. So it's not something that is scaring us. Or we didn't want – we don't want to sound alarms about our margins.

It's more – it's normal to have competition in high-growth areas, and we're good with that..

Okay. And then last one for me, on inland barges. It's encouraging to see the interest levels perking up.

I was curious, does the margin profile materially vary between dry and liquid? Is this really more of kind of an operating leverage story in terms of margins recovering?.

So I think there's not a huge margin difference between liquid barges and dry barges. A lot of the improvement in margins throughout the year is the conditions in which the order was placed. So like I said early in the year, we'll be delivering orders that we're taking in a weak pricing environment.

Now regardless of dry or liquid, the pricing environment is better than that. And then secondly, as you noted, it's improved operating leverage as we get our plants ramped up, particularly our third facility in Madisonville, Louisiana. We should see improvement in margins throughout the year..

Great. Thank you..

Our next question will come from Justin Bergner with G. Research. Please go ahead..

Good morning, Antonio. Good morning, Scott. A few questions here. Just wanted to start off. I thought I heard you say that revenue in barges would be up 70% to 80%.

Was that for the sort of full year or more the exit rate in the fourth quarter of 2019?.

So that would be full-year 2019 versus 2018. So we have – if you kind of do the backward math of – we had a number of quarters that were 1.4, 1.5, 2.0 book to bill. And so just playing those into 2019, you're looking at a very significant revenue growth in that range..

Great. Thanks for confirming. And then secondly, the corporate costs, just to verify, the $12 million to $13 million quarterly run rate for corporate costs is still valid looking into 2019, notwithstanding the low corporate in 4Q.

Any sort of thoughts on where you can bring that down looking past 2019?.

Yes. That's a good question. So first, you're right, $12 million to $13 million is our expected run rate for 2019 per quarter. And it's probably more like $13 million in the first half and $12 million in the second half, as we're able to come off some Transition Services Agreements. I think it's too early to say what 2020 looks like.

I think you'll be closer to the $12 million and hopefully even reduce it lower than $12 million per quarter into 2020. A big part of our incentive plans this year on the corporate side is reducing our corporate SG&A. So it's something that everybody's targeting, but I think it's too early to give a specific number for 2020..

Okay. Understood. And then in rail components, you mentioned some orders from other customers.

Are those new customers or expanded wallet with existing business from non-trending customers in any sort of way to quantify how big or how much larger that book of business has become in recent months?.

Yes. This is Antonio. Let me give you some color, Justin. I think the reason we wanted to mention it is, one of the – part of the rationale of keeping – letting these businesses go to Arcosa and the spin-off is the fact that there's a market out there that has potential.

And when you are a competitor to some of the other industry players, they will not place an order with you. So we've been able to get some trial orders from some of, let's say, other industry players. But it's early. We are getting trial orders. Most of them have long-term agreements for their supply.

So I think this is more a 2020 and 2021 play and more a medium- to long-term good news that we are building this new customer base and we're developing new customers. And to be honest, I think it's also an indication that it was a good decision to leave this business to develop other markets..

Understood. No. Good luck with that. That sounds promising. And then just lastly, I guess, the number of share repurchases you did in the quarter was pretty modest despite the stock being depressed around the time that the share repurchase authorization was announced.

Should I infer or should we infer from that that the preference for capital allocation, sort of is bolt-on acquisitions, and that repurchases will sort of take effect, not just based on the share price, but based on not having bolt-on acquisitions to absorb all your cash flow?.

Yes. This is Scott. I'll take that, Justin. So I guess, I wouldn't infer too much from the December cadence because the approval was only in early December. And so we only had about two to three weeks to execute it. And so $3 million in that time period we felt like was the right move.

We got a $50 million authorization from the board over two years, and we would expect to use it when appropriate. And we're always trying to balance the use of capital in that way versus organic investments that I talked about in acquisitions. So we had the authorization. And when it's appropriate, we will use it..

Great. Thanks for taking all my questions..

Thanks, Justin..

Our next question is a follow-up from Craig Bibb with CJS Securities. Please go ahead..

I just wanted to kind of circle back to the improvements you're trying to achieve with margins at the Energy Equipment business. So it sounds like the focus was primarily, be as efficient making utility structures as you are with wind towers.

But how is pricing in the industry? What kind of volume growth do you expect in 2019 and 2020? And I think the size of the structures has a big impact on margins.

What are you seeing there?.

Yes. This is Antonio. So the Energy Equipment business has, I would say, three components to it. One is the wind towers, which is operating very well. And it's holding its margins, and it's doing a really good job.

As you mentioned, we're moving the program that has been successful there into transmission, and we started at the end of last year implementing that. And we're going to be working throughout the year and making sure that that takes place. And it has the two sides to it. One, I think there's good demand in the industry.

We're seeing good demand for our products. So demand is there to keep us busy for the year. What we're trying to do is increase our throughput. And as we increase our throughput, we can capture more and more demand, and we can also be more efficient as we produce it.

So I think the main focus is on increasing our throughput in our facilities, optimizing our footprint and really, let's say, using our resources to the full scale that we have. And I think there's good trends happening there, and we have a good team that's working on it. So throughput is a key in our transmission business.

The third business is the tank business. And the tank business, I would say, is a business that we have not been focusing it for a while. We have two sides to it, the Mexico side and the U.S. side, and we're seeing good growth on both now that we are focusing on it. Their margins were not where they needed to be.

And we are also working – as I mentioned, we restructured our Mexico business. And we're seeing a very nice turnaround, and we expect a big turnaround for our business this year. So margins are not only in terms of improving in transmission, but also businesses that were not performing or, frankly, let's say, pulling us down.

We expect them to start helping us pull up. And those are the three sides of this transformation we're trying to do in Energy..

Okay. And I think in your comments, you mentioned that fuel shortages in Mexico could increase demand for pipeline and storage.

Could you kind of explain to us how that would play out?.

Yes, absolutely. So if you read the news about what's going on in Mexico, there's fuel shortages for gasoline and other products. Most of the news are based on gasoline, but what's happening in gasoline basically extends to many other products. So there's demand for additional storage.

Mexico has less than five days of gasoline storage in their system, and they need more gasoline storage. And there's now private players working on that. So there's large global companies building storage facilities and bringing gasoline into Mexico and selling directly to the customer.

If you went to Mexico five years ago, all the gas stations you saw were Pemex. Now there's seven or eight or nine brands that are selling gasoline. And those players will require their own gasoline, will import some of their own gasoline. So that brings additional capacity and needs.

And we are in the process of building our first terminals, and there's also some additional demand that we're seeing from some of our traditional customers that require additional propane moves. And we are building some additional transport.

So it's not something that will take hold immediately, but I think this is a good trend and a good new source of demand for us..

Okay. I mean, that was all extremely bullish, what you just laid out.

I mean, can you give us an order of magnitude of how high is up over time as things play out?.

Our business in Mexico for Arcosa is not very large. It's about 10% of our revenue. So I want to give you a guidance on how big it's going to be. But if it grows, it's going to be a nice growth for the 10% that we have in Mexico. That is not going to be a needle-mover for the total company.

I think what we are trying to do is to grow the company, but doing a lot of small things that all of them will add to a movement for the whole company..

All right, thank you very much..

And there are no further questions at this time. So I'll turn it back to Gail Peck for closing remarks..

Thank you, Bree. Thank you, everyone, for joining us today. We look forward to speaking with you again next quarter..

This does conclude today’s program. Thank you for your participation. You may now disconnect..