Good morning, ladies and gentlemen, and thank you for standing by. Welcome to Allison Transmission's Second Quarter 2019 Earnings Conference Call. My name is Sherry. I will be your conference call operator today. At this time, all participants are in a listen-only mode.

After their prepared remarks, the management team from Allison Transmissions will conduct a question-and-answer session and the conference call participants will be given instructions at that time. [Operator Instructions]I would now like to turn the call over to Mr. Ray Posadas, the company's Director of Investor Relations. Please go ahead, sir..

Thank you, Sherry. Good morning, and thank you for joining us for our second quarter 2019 earnings conference call. With me this morning are Dave Graziosi, our President and Chief Executive Officer; and Fred Bohley, our Senior Vice President, Chief Financial Officer and Treasurer.

As a reminder, this conference call, webcast and the presentation we are using this morning are available on the Investor Relations section of our website, allisontransmission.com.

A replay of this call will be available through August 8.As noted on page two of the presentation, many of our remarks today contain forward-looking statements based on current expectations.These forward-looking statements are subject to known and unknown risks, including those set forth in our second quarter 2019 earnings press release and our annual report on Form 10-K for the year ended December 31, 2018, and uncertainties and other factors as well as general economic conditions.

Should one or more of these risks or uncertainties materialize or should underlying assumptions or estimates prove incorrect, actual results may vary materially from those that we express today. In addition, as noted on page three of the presentation, some of our remarks today contain non-GAAP financial measures as defined by the SEC.

You can find reconciliations of the non-GAAP financial measures to the most comparable GAAP measures attached as an appendix to the presentation and to our second quarter 2019 earnings press release.Today's call is set to end at 8:45 a.m.

Eastern time in order to maximize participation opportunities on the call, we’ll take one question from each analysts. Please turn to Slide 4 of the presentation for the call agenda. During today's call, Dave Graziosi will provide you with an overview of our second quarter results.

Fred Bohley will then review the second quarter financial performance and the 2019 guidance update. Finally, Dave will conclude the prepared remarks prior to commencing the Q&A.Now I'll turn the call over to Dave Graziosi..

Thank you, Ray. Good morning, and thank you for joining us. We are pleased to report that second quarter 2019 results exceeded our expectations and the guidance ranges provided to the market on April 23.

Year-over-year net sales increased 4% to a quarterly record of $737 million, second quarter net income was $181 million, adjusted EBITDA was another quarterly record of $308 million and diluted EPS increased 13% to $1.46 per share.

We are pleased to report that Allison continues to execute its well-defined approach to capital structure and allocation, settling $235 million of share repurchases and paying a dividend of $0.15 per share during the second quarter.Additionally, in May, the Board of Directors approved a $1 billion increase in the existing stock repurchase authorization, resulting in $1.16 billion of remaining authorized share repurchase capacity as of the end of the quarter.

Finally, given second quarter 2019 results and current end market conditions, we are raising our full year 2019 guidance for net sales, net income, adjusted EBITDA, net cash provided by operating activities and adjusted free cash flow.

Fred will discuss the guidance update in more detail momentarily.Please turn to Slide 5 of the presentation for the Q2 2019 performance summary.

Net sales increased 4% to $737 million compared to the same period in 2018, principally driven by higher demand in the North America On-Highway end market led by the continued execution of our growth initiatives and market share gains in Class 4-5 truck.

The increase in net sales is also attributed to higher demand in the Outside North America Off-Highway end market, partially offset by lower demand in the North America Off-Highway and Service Parts, Support Equipment & Other end market.Gross margin for the quarter was 52.8%, an increase of 20 basis points as compared to 52.6% for the same period in 2018, principally driven by increased net sales and price increases on certain products.

Net income for the quarter was $181 million compared to $174 million for the same period in 2018.

The increase was principally driven by increased gross profit, partially offset by increased product initiatives spending and increased interest expense.Adjusted EBITDA for the quarter was $308 million or 41.8% of net sales compared to $297 million, also 41.8% of net sales for the same period in 2018.

The increase in adjusted EBITDA was principally driven by increased gross profit, partially offset by increased product initiatives spending.Now I'll turn the call over to Fred..

Net sales are expected to be in the range of $2.635 billion to $2.715 billion. This is an increase from our prior expectation of net sales in the range of $2.58 billion to $2.68 billion.Net income is expected to be in the range of $545 million to $585 million, up from our prior expectations of $525 million to $575 million.

Adjusted EBITDA is expected to be in the range of $1.025 billion to $1.075 billion, an increase from our prior expectation of $1 billion to $1.06 billion. Net cash provided by operating activities is expected to be in the range of $735 million to $765 million, up from our prior expectation of $710 million to $750 million.

Adjusted free cash flow is expected to be in the range of $570 million to $610 million, an increase from our prior expectations of $550 million to $600 million.

And cash income taxes are expected to be in the range of $105 million to $115 million compared to our prior expectation of $100 million to $110 million.Allison's full year 2019 net sales guidance reflects lower demand in the Service Parts, Support Equipment & Other and North America Off-Highway end markets, principally driven by lower demand from hydraulics fracturing applications, partially offset by increased demand in the North America On-Highway end market, price increases on certain products and the continued execution of our growth initiatives.Our updated 2019 guidance also assumes capital expenditures in the range of $155 million to $165 million.

As discussed earlier in the year, the increase in CapEx spending is principally funding the current expansion of our engineering facilities and testing capabilities. These investments underscore our ongoing commitment to remain a leading innovator in commercial vehicle propulsion solutions across all the end markets we serve.Thank you.

And I'll now turn the call back over to Dave..

Thanks, Fred.

Among our established strategic priorities of global market leadership expansion, emerging markets penetration and core addressable end markets growth while simultaneously delivering solid financial results and creating value for all of our stakeholders, we continue to emphasize product development initiatives and programs that focus on value propositions to address the global challenges of improved fuel economy and reduced greenhouse gases.

It is with this focus in mind that we previously announced the new state-of-the-art vehicle environmental test facility that is expected to be operational in 2020.Once complete, this new facility will include two environmental chambers capable of simulating a broad range of vehicle environments and duty cycles including temperature extremes, grades, altitudes and other on-road vehicle conditions.

Consistent with this investment and other product development initiatives and programs, in June we announced the construction of Allison's new innovation center, a 95,000 square-foot facility that will be located within our Indianapolis campus and is scheduled for completion in 2021.The innovation center will feature expanded and unique virtual and physical system simulation capabilities, including development and validation capacity to support customer, partner and supplier relationships, regulatory compliance simulations focused on fuel efficiency and greenhouse gas emissions reduction as well as functional safety.The innovation center will consolidate our product engineering groups and facilitate internal as well as external collaboration on future technology and product initiatives, including electric hybrid and fully electric propulsion systems development and refinement.

The concepts being generated, modeled, simulated and tested in these state-of-the-art facilities will significantly enhance our ability to efficiently develop, manufacture and quickly bring to market new propulsion solutions across all of the end markets we serve.

Together, these new resources and capabilities will promote closer and differentiated integration with our OEM customers, support performance improvements for vehicle optimization and reinforce Allison's ability to attract, develop and retain the very best talent.In closing, Allison is committed to be a global leader in commercial vehicle propulsion.

Our second quarter results once again demonstrate the power of Allison to create value for all of our stakeholders, while we continue to invest prudently and opportunistically to further our strategic priorities, develop innovation and fuel growth and secure and enhance our ability to deliver compelling value propositions to our customers.This concludes our prepared remarks.

Sherry, please open the call for questions..

Thank you. At this time, we’ll be conducting a question-and-answer session. [Operator Instructions] Our first question is from Jerry Revich with Goldman Sachs. Please proceed with your question..

Yes. Good morning everyone..

Good morning Jerry..

Yes.

Dave, can you say more about the range of propulsion systems that you folks are working on developing here? Do you have the key pieces in place following your recent acquisition in terms of the key parts of architecture? Or said another way, how should we be thinking about the required capital allocation toward M&A from here to fully build out the capabilities that you're going to be looking for on a multiyear basis?.

Sure. The – as we talked on the April call with the announcements of the AxleTech EVS and Vantage Power acquisition, our approach is to continue our global leadership position in innovation. That requires that we're able to provide a range of solutions.

What do we mean by that from conventional, whether it's gas or diesel right through to full electric. That entire range is what we're focused on. To your question in terms of cap allocation and the impact on that, we would certainly view our current position. We're well positioned to deliver propulsion solutions.

However, as we've said, the cadence of investment will not be linear.Frankly, we are staying very close to the market, whether that's OEMs, end users, etc., but looking at the actual demand from the market for solutions. That also is going to be dependent on a number of attributes we do not control back to system cost as well as performance.

There's many variables that are involved. But again, as we think about that range of solutions, it's from conventional fuels to alternative fuels to full electric and that also includes fuel cell electric vehicles.

So we see a very complete range with our existing technologies and look forward to the market pulling through that technology as appropriate..

And just a follow-up, just appreciate the capacity not linear in terms of capital deployment, but in terms of allocation of free cash flow that we saw this year in terms of buyback dividend versus M&A.

Is that the type of placeholder we should think about for capital deployment toward these technologies going forward? Can you just give us a rough framework?.

Look, our objective hasn't changed, which is to generate cash, invest for appropriate returns and return the balance of cash to our shareholders. So as we see the environment today, we're – as I said, we believe we're well positioned.

Having said that, we will fund the various investments we've announced earlier this year including the vehicle environmental test facility as well as the innovation center.I think we're well positioned from a capacity perspective at this point as well, but I would tell you that I think it's very premature for us to try to define the next few years in terms of absolute allocation other than the broader objective, which is generate cash, invest for appropriate returns and return the balance to our shareholders..

Our next question is from Jamie Cook with Credit Suisse. Please proceed with your question..

Hi good morning. Nice quarter. I guess two questions. One, the sales in North America On-Highway were better than expected. Obviously, some of it was market, but I was impressed by the ability to sort of outgrow the market.

So can you talk about where you are relative to expectations and how we think about your ability to potentially outgrow the market if 2020 is indeed a down year?And then questions on the back half of the EBITDA guidance. I think it still implies that we're going to be down versus sort of where the consensus is.

So can you just provide a framework around that? Is it typical Allison conservatism? Is there something that you're seeing out there on the macro side that makes you just a little more cautious? Thank you..

Good morning Jamie, it's Dave. A couple of things. I'll let Fred cover the EBITDA question in the second half. On – relative to sales performance, appreciating your comments on the second quarter performance, the team continues to execute, we believe, extremely well in North America. The share gains, we're certainly pleased with.

As you know, regaining a position in Class 4-5 truck through the GM Silverado platform and Navistar CV series as well have been well received by the market. Frankly, we're returning to positions we have not had access to in the better part of the decade.

So we've made good progress there.The team continues to execute well in terms of Class 8 straight as well as Metro. The strong vocational markets as we've talked about before have allowed us to continue to push forward our agenda and value proposition with the continued push by the market for automation. So I think we're very pleased with that.

To your comment about continuing that process going forward, I think, again, we're well placed to execute their prior cycles.I'd certainly highlight the fact that our book of business has a higher share of municipal volume in a number of sub-segments that tend to sustain themselves in softer markets.

So in those cases, we continue to be less volatile as a business versus some others that have over-the-road, line-haul type exposure. So we are planning for a number of different outcomes.

As I said earlier, I think we're well placed from a capacity perspective, while at the same time focusing on operational excellence initiatives as well and proud of the team's performance here in the second quarter and very focused on the second half.And I'll let Fred cover your question in terms of run rate for the second half..

Sure. Jamie, primarily in the second half versus H1 is really driven by our view of the top line outlook. We still have the Off-Highway new units and service parts down significantly. We do have R&D increased in the second half.

Consistent with what we talked about on the Q1 call, we expect engineering R&D to be up about $20 million year-over-year with the vast majority of that increased in the second half.Commercial expenses is slightly elevated in the second half in support of our growth initiatives.

And really consistent with the pricing you've seen in H1 where we've achieved approximately 50 basis points of favorable pricing, we expect that to continue for the second half..

Okay. I appreciate the color. Thank you..

Our next question is from David Leiker with Robert W. Baird & Company. Please proceed with your question..

Good morning, this is Erin Welcenbach on for David. So my question for you is really relative to your outlook 90 days ago.

Can you maybe give us the run through of kind of the State of the Union for your end markets? Maybe how you're end market outlook has shifted a little bit and sort of the puts and takes to that?.

Good morning Aaron. This is Dave. Yes, in terms of our outlook shifting, it's – from the second quarter results, you can tell we – as we said in our comments outperformed there a bit.

That's rolled through as you would appreciate the balance in terms of the full year guidance update so to speak, but I think our positioning stands in terms of as we started the year, we talked about a number of different backdrops to the market and really focused on what the second half would pretend. Tougher comps in a number of the end markets.

Beyond that, I would tell you I think the broader tonality of guidance as we started the year I wouldn't say has really shifted much.I would highlight though the Off-Highway situation for North America in particular, given the last week or so of public comments by a number of service providers as well as suppliers continues to support I think the view that we started the year with.

Frankly, that set up as we get into the second half, the constraints around really hard rationing as we see it in terms of capital being deployed into that space. The focus there being very much currently on maintenance versus new investments.A fair bit of excess equipment as we understand it in that market is not different.

I would say what is different is I think a focus more so on that capital rationing in the sector at this point. So it's something we're staying close to as we start to think about 2020.

But beyond that, I think we're pleased with the team's performance through the first half and are obviously trying to position ourselves for continued success as we enter 2020..

Great, thanks for taking my question..

Our next question is from Joe O'Dea with Vertical Research Partners. Please proceed with your question..

Hi good morning.

On the implied step up in R&D in the back half of the year, anything in particular you would call out that that's going toward? And then is that something that we should be thinking about as a run rate moving forward?.

Good morning, Joe, it's Dave. As Fred mentioned, there's a number of initiatives that we're driving across all of our end markets. Frankly, as we see the second half, as we've talked before, a number of the initiatives, frankly many of them are not linear as well.

So our activity levels are driven off of the opportunities that are there and frankly program timing, execution, but I would not necessarily say there's anything in particular that I would point out other than the obvious, which is bringing on the e-axle effort as well as Vantage Power.There is a number of initiatives that we're pursuing as part of that.

As you know, that can be either done internally or externally, now being done internally. We're also working on continuing to work on delivering our next-generation transmission controls and a number of other new technologies as well as I would describe variance in terms of improvements to existing products.

So team's very busy across all of our end markets. From a cadence standpoint, again, I think we're generally pleased with where we sit, but we'll continue to drive around those opportunities and position ourselves going into 2020..

And then on outside North America energy, is that led by China fracking? And if so, is this something that you view as kind of a temporary step up? Or do you think there's a trend being established here?.

Yes. The answer to your point there is the energy outside North America is largely tied to China. That market is maturing versus where it was say four, five years ago. They ramped up significantly in terms of investment levels for equipment. They've now, I think, digested a fair bit of that and matured as end users and frankly demand levels.

We see that as more of a stable market going forward.That being said, energy as you all know is a volatile commodity market. So we don't confuse ourselves in terms of looking at that business is level for the duration. It will have its cycles and we've structured our business in such a way that it's capital asset light from that perspective.

And frankly, we carry a number of different options within our business model around inventory levels to deliver what is typically very short lead times in that market, given the underlying volatility of end users, so – but the market there appears to be relatively stable..

Our next question is from Larry De Maria with William Blair. Please proceed with your question..

Hey guys. Good morning everybody. Just curious – I know you made the comment about obviously more maintenance versus new. I believe that was in the energy path you were talking about, which is what obviously everybody's seeing.

Can you discuss where you see the idling of fleet and the cannibalization of parts and how that plays out? In other words, is there much – how would you characterize downside following the second half run rate of declines in service parts based on excess fleet, cannibalization, etc., if there's no positive change, which might be fairly unlikely, obviously, going into next year?.

Larry, it's Dave. A few things there. I think in terms of run rates, we obviously started the year out with a pretty – I would say a pretty muted view of the market overall. I think unfortunately that's borne itself out. The hard rationing of capital that I mentioned earlier, I think, is going to continue to really suppress opportunities for spending.

That being said, as a number of public comments have been made, that potentially sets itself – I think the market up for some level of bounce back.

I would say that would seem to be a steeper curve if you take the public comments as they've been made literally, there's very little less going on.So to your question on cannibalization, the fact is I think equipment is being stacked prior cycles. I would say we're probably not as I think informed as the market seems to be now.

I would be surprised if equipment is getting stacked at such a level that it will be incapable or unable to be returned to service, just given the age of some of that equipment as well.

And there's been a fair bit of money spent I think to the positioning of the overall fleets going into this particular soft patch seems to be better than it's been.That being said, that's really going to be dictated by capital rationing back into the space. So investors feel that there is real opportunity there.

At some point, the funding is going to return and the question is how quickly if it's extended.

I think that has some lasting damage in terms of the overall level of fleet capability that will be available going forward.So we've assumed that the inventory that's in the broader market in terms of units as well as stacked equipment or otherwise will be leveraged as best as they can, but the fact is utilization rates are still relatively high with equipment that is fielded, so the intensity of usage has not changed.

It's really a matter of the broader capacity that's been parked. But when the capacity is utilized, it's at a very high level, which pretends to ultimately require either new units at some point or that overhaul maintenance..

So, thanks for that Dave.

So with that being said, in the excess capacity that's out there now, how would you characterize the downside of service parts from the second half run rate into next year? Is it – if the end market for new doesn't change, is there much further cannibalization of those parts likely? Or are they going to keep in decent shape to bring it back to service and we'll see more rebuilds in overhaul and parts stabilizing for you guys? Or is it hard to tell?.

I think you can – our expectation and guidance implies a pretty significant step down into the second half of this year. I don't – based on public comments, would not expect a different outcome going into necessarily the first half of next year. So to your point, I would expect some level of cannibalization.

Also, I would certainly let you know that our channel checks would tell us there's equipment that is out there in terms of opportunities to utilize for a number of different repair scenarios. So we don't see anything at this point near-term that would change that outlook from public comments that have been made..

Our next question is from Ian Zaffino with Oppenheimer & Company. Please proceed with your question..

Hi. Great thanks. Just a real quick question here. What was the actual energy piece of the service parts line item that you have? And where should we expect that to kind of settle in, just given all your previous comments? Thanks..

Ian, good morning, it's Dave. Run rates in terms of the Off-Highway – specifically, your question Off-Highway North America parts, Q2, we are in a range of, call it, $30 million for North America Off-Highway service parts..

Okay. And we should assume that goes close to 0.

Is that the way to think about it?.

No, I would say it's certainly – the expectation is a meaningful step down in the second half in terms of run rate. 0 is a bit of an extreme, but it's definitely expected to step down..

Our next question is from Seth Weber with RBC Capital Markets. Please proceed with your question..

Hey guys. Good morning. Just wanted to ask about what you're kind of seeing in the channel? Inventory to sales ratios have been kind of ramping up here through most of the first half of the year. Just any comments on how you're feeling about inventory levels in the channel – in the straight truck market? Sorry, thanks..

Good morning, Seth, it's Dave. The – I guess to your point in terms of inventory to retail sales ratio, 6, 7, certainly up in terms of overall volume year-over-year, so – and not an insignificant number. If you look at the actual retail sales ratio, it's at the higher end of what the industry views as a comfortable range, shall we say.

Clearly, I think there's less pressure there necessarily on managing inventories going into the balance of the year in Class 8 straight, which is higher on a percentage basis year-over-year in terms of units.

But when you look at that inventory to retail sales ratio, we probably mark that at a 1/2 to 3/4 of year high versus the optimal so-called optimal range.And I would say in terms of within the channel as it's been communicated to us, certainly, the level of the quality of the inventory that's out there has improved.

In other words, trucks that aren't parked, waiting parts, I think that much of that has been resolved. The supply situation as we understand it from OEMs has improved. There are a number of spot situations that are exceptions. But broadly, it's better than it – than it's been.

Certainly, I think the other thing to dig into is when you look at the dealer – some of the dealer levels as well as what's sitting at bodybuilders.That's really where you start to get a bit more visibility.

I would say lead times seem to have come down a bit in terms of the bodybuilders, which I think is also indicative of a situation that you could interpret as there is adequate if not heavier inventory levels that are now available out there in the Class 8 straight truck side, so – and that goes back to the ratio that I just mentioned.So I think that as we stay close to the market going into the end of the year will be critical I think for the broader industry to look to manage for a 2020 start.

The orders continue to be relatively fulsome, but not as strong as they've been. I think that's another outcome in terms of how the OEMs are going to manage into the end of the year as well. But they're reasonably, as we understand it, full for the second half, but I think the positioning has already started for 2020..

Our next question is from Courtney Yakavonis with Morgan Stanley. Please proceed with your question..

Hi. Thanks for the questions. Just wanted to understand the [indiscernible] On-Highway this quarter. You mentioned both the market share gains in Class 4-5 and then also some of outgrowth opportunities [indiscernible] through 7 and Class 8 markets.

Can you just help us understand how [indiscernible] about $50 million, how much was from Class 4-5 versus some of your core markets? And then in outside North America Off-Highway where you also peaked pretty considerably this quarter, I think you had last given guidance for that segment to about down 19%..

Yes, Courtney, I'm sorry – good morning, it's Dave. Just briefly repeat your question. You broke up a number of times there..

Sorry about that.

So just on the North America On-Highway beef, can you just disaggregate how much was from better-than-expected market share gains in Class 4 through 5 versus continued gains in 6 through 7 and Class 8? And then on North – Outside North America Off-Highway where you also beat this quarter, I think the last time you gave guidance there was for down about 20%.

So given the beef you've had this quarter, what are you embedding in that segment? Appreciating some of your comments earlier that you don't have a ton of visibility there..

Courtney, this is Fred, I'll take the first part of the question on what appears to be an outperform versus the market in Q2. Certainly, we've talked about the share gains in Class 4-5 and those are easy to quantify with the recent OEM launches. We expect that's resulting in us outgrow in the market by 3% to 4%. Certainly, we're picking up some price.

We talked about 50 basis points of price year-over-year. The balance of the outperform would lean toward suggesting share gains in Class 8 straight, Class 6-7. We only publish share once a year.We'll publish that in the early part of 2020. You do see production volumes get restated and such, but certainly strong performance in the second quarter.

The team's driving volume out there via conquesting new fleets that are primarily used in manual transmission. There is just a general move away from manuals to fully automatics. So as I mentioned, Class 4-5 pretty easy to quantify, 6-7, Class 8 straight will be in a position to communicate final share in early 2020..

Courtney, this is Dave. On your outside North America question there in terms of second quarter, as we briefly mentioned in the press release, higher demand in Europe really off of truck, strong performance there. South America, I think the team's doing very well driving a number of growth initiatives in res use as well as agriculture.

The lower demand in Asia is really focused on Japan export trucks for regions, countries like South America, Australia and Malaysia.

As you know, Australia in 2018 was a very strong market.We're starting to see, I think, as we talked about entering the year at some level of softness in that market, just given the higher demand that we saw in 2018, the balance of the year in terms of those regions, Europe overall expect reasonably strong performance in terms of truck, driven by the major European OEMs.

Asia, I would say, good performance expected through our India bus business as well as some activity in terms of China exports.

Truck overall in China with the emissions changes that are – that have started to be implemented, vehicle values starting to drive there as well as the growth initiatives that we have very targeted with the team.We were expecting some growth there. Some work that we've done more recently in terms of Korea light duty truck has been well received.

That's partially offset via the Australia market that I mentioned earlier and then South America, I would say, overall for the year pretty strong performance in terms of bus expected particularly out of some activity in Columbia on their BRT as well as frankly some other initiatives we're driving in bus.

I think the one exception to that region continues to be the macroeconomic challenges for Argentina..

Our next question is from Ann Duignan with JP Morgan. Please proceed with your question..

Hi, good morning. If I could just circle back to the growth in revenue in North America On-Highway, it sounds what $55 million.

Can you just tell us how much of that $55 million was due to the Class 4-5?.

Hi Ann, this is Fred. So of the $55 million in the quarter, you're looking at somewhere between $10 million to $15 million driven by Class 4-5..

Okay. That's helpful. And then most of my other questions have been answered, but again, Halliburton is a significant customer of yours in the Off-Highway segment and they've called for CapEx to be down this year, but again, in 2020. Is that what you were alluding to in terms of your comments on publicly traded companies commentary in recent days..

Good morning Ann, it's Dave. Yes. That's what I was alluding to among other end users that we have in North America frac, but that is the – certainly the tonality as you noted over the last week or so pretty consistent as we understand it across the board..

We have reached the end of our question-and-answer session. I would like to turn the call back over to Dave Graziosi for closing remarks..

Thank you, Sherry. As we said before, it's an exciting time to be part of Alison. We find ourselves today with more opportunities to drive innovation and growth than at any other time in our history, and we look forward to providing you with further updates in the months to come.

Thank you for your continued interest in Allison and for participating on today's call. Enjoy the rest of your day..

Thank you. This concludes today’s conference. You may disconnect your lines at this time, and have a wonderful day..