Chris Witty - IR Steve Oswald - CEO Doug Groves - CFO Tony Reardon - Chairman.

Edward Marshall - Sidoti & Company Ken Herbert - Canaccord Gennuity Mark Jordan - Noble Financial Mike Crawford - B. Riley & Company.

Good day, ladies and gentlemen and welcome to the Ducommun Fourth Quarter 2016 Earnings Conference Call. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session and instructions would be given at that time. [Operator Instructions]. As a reminder, this conference call is being recorded.

I would like to turn the conference over to our moderator for today Chris Witty. You may begin..

Thank you. And welcome to Ducommun’s 2016 fourth quarter conference call. With me today are Tony Reardon, Chairman of the Board of Directors; Steve Oswald, President and CEO; and Doug Groves, Vice President, Chief Financial Officer and Treasurer. I would now like to provide a brief Safe Harbor statement.

This conference call may include forward-looking statements that represent the Company’s expectations and beliefs concerning future events that involve risks and uncertainties and may cause the Company’s actual performance to be materially different from the performance indicated or implied by such statements.

All statements other than statements of historical facts included in this conference call are forward-looking statements. Although the Company believes that the expectations reflected in such forward-looking statements are reasonable, it can give no assurance that such expectations will prove to have been correct.

Important factors that could cause actual results to differ materially from the Company’s expectations are disclosed in this conference call and in the Company’s annual report on Form 10-K for the fiscal year ended December 31, 2016.

All subsequent written and oral forward-looking statements attributable to the Company or persons acting on its behalf are expressly qualified in their entirety by the cautionary statements.

Unless otherwise required by law, the Company undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise after the date of this conference call. I would now like to turn the call over to Mr. Tony Reardon for a review of the operating results.

Tony?.

Thank you, Chris. And thank you everyone for joining us today for our 2016 fourth quarter conference call. We'll do things, a little bit different today. I will begin by providing an overview of recent accomplishments and our current market outlook, then I'm going hand the call over to our new President and CEO, Steve Oswald to say a few words.

After which Doug Groves will go our financial results in detail. But first let me say a few words about Steve. It gives me great pleasure to have Steve take the helm of the Ducommun.

His appointment follows a thorough search by our Board of Directors to find a dedicated, experienced executive to take the company to the next level in its growth trajectory.

Steve has an excellent background in the industry having previously served in a leadership positions at organizations including Capital Safety, United Technology, [Indiscernible] and GE.

Since joined the Ducommun he has been diligently working to become familiar with our management team, business units and our unique manufacturing capabilities and applications. We're proud of all that we've accomplish this past year, as we've strengthen the balance sheet, streamlined our operations and improved our overall operating results.

I believe that Steve will now bring a fresh perspective to run in the comment with the passion, capability and experience needed to drive our long term financial performance. He will continue our focus on growing the topline, expanding our customer base and leveraging our unique structural and electrics capabilities to enhance shareholder value.

The Board and I are very confident in the future of the Ducommun in Steve's hands as we turn to a new chapter in our history. I will be staying on as the Chairman to help ensures smooth transition as Steve guides the company going forward.

Now turning to our recent results, let me just say how pleased we are to report another quarter of strong performance. We paid down an additional $10 million of our debt during the period, which means we eliminated total of $75 million of indebtedness this year.

These payments were driven by strong operating cash flow of $43.3 million and along with the proceeds from some appropriate divestitures that served to focus the company and improve our long-term margin profile. On that note, we again posted strong gross margins of 19.5% in the fourth quarter.

At the same time enter the year with a backlog of approximately $600 million driven by a nice uptick in the commercial aerospace backlog, which now stands at $318 million. Now let me provide some additional color on our end markets products and programs. I’ll begin with our commercial aerospace business, certainly a highlight of our operations.

As I mentioned, our back log here again is at record levels and spans an array of exciting platforms serving Boeing, Airbus and several other OEMs. Total commercial aerospace revenue in Q4 was approximately $65 million and full revenue -- and the full year revenues close to $264 million, up 6% from 2015.

We continue to be pleased with our position on the Boeing 737 and the 737 Max, the 777 and the 787 programs, as well as the Airbus A320, A330 and A350 platforms.

As you may have seen, we recently announced that the company has received a multi-year, multi-million dollars contact from Airbus to produce additional titanium structures for engine support and engine frames on A320neo.

This award increased our content on the neo and illustrates the value added structural solutions that leverage our titanium expertise, the key area of strategic focus for Ducommun. Our titanium sales are growing fast and expected to represent almost 50% of our structures business in the not too distant future.

We remained on track expanding our Parsons, Kansas facility to support our titanium operations and increased demand that we see in the quarters to come.

In fact, we are developing over 25 new applications in 2017 in the titanium area alone and expect this to significantly influence our future growth trajectory as we continue to invest in titanium to support our customers change requirements on next generation aircraft.

Turning to our military and space sector, fourth quarter revenue fell slightly to 65 million from our $69 million last year, reflecting our Miltec divestiture, but results for up sequentially from the third quarter's $54 million and our back log held steady at 257 million versus our 227 million at the end of 2015.

Excluding the Miltec impact, military and defense sales actually rose slightly year-over-year, reflecting higher shipments on radar racks and other components on key platform such as the F-18 and the F-15 programs.

We continue to believe that the company is now operating in a base line rate of approximately $60 million plus or minus per quarter for our military programs and foresee the possibility of higher defense spending under the new administration.

It's too early to say how things will play out with the budget in Washington, but we are cautiously optimistic about revenue growth within this part of our business going forward. We anticipate higher shipments of radar racks to the F-15 and the F-18 in 2017 along with solid missile systems revenue.

At the same time we continue to target additional opportunities for innovative solutions as well as platform modifications and upgrades within the defense arena. Overall, we believe the [technical difficulty] quarter illustrates the type of operating results we are targeting throughout 2017.

However, as a reminder, our first quarter is usually our softest from the top line perspective due to the seasonality and we expect Q1 for 2017 to be in line with the first quarter of 2016 after adjusting for the divestiture.

Gross margins could be down slightly in the 18% range due to the number of new programs currently under development that are projected to come on line in the second half. Our improved balance sheet and our margin profile should drive solid earnings as our top line benefits from platform growth and new applications later this year.

Given our position on the number of leading programs ramping up in 2017 most notably the 737 and the A320 and the prospect of slightly higher defense spending, we look forward to another year of strong performance and returns to our shareholders.

We did exactly what we said we would do in 2016, and we're pleased with how well the Company is positioned as we begin 2017. With that I'm happy to turn the call over to Stephen Oswald, Ducommun's new President and Chief Executive Officer..

Thanks, Tony. It's great to be onboard with Ducommun, where I see a lot of potential as to begin in my tenure as President and CEO.

It's been a busy albeit short-time since joining the company and I've been focused on mainly the operational management, travelling to the many sites, reviewing program rollout plans and jointly quite familiar with every aspect of the business.

What I found is an organization of talented individuals who are dedicated, know the aerospace industry extremely well and are excited about the important role we play on a number of leading platforms. These people as well as the potential is why I joined Ducommun, and I will layout more of my vision in the months to come for the Company.

As you know a number of measures are already taken to reinvigorate and focus Ducommun before I arrived. I want everyone to know we'll continue to follow a past that increases both top line growth and bottom line results.

The fact that margins were solid, expenses are down and the balance sheet strong will provide the flexibility and foundation for us to focus in on innovation, business development and of course having a world class team on the field. As Doug will review in a moment, we posted strong margins cash flow again this past quarter.

We believe the outlook for 2017 and beyond looks promising given our large book of business and attractive applications on many leading aerospace platforms. It's certainly an exciting time to be joining the company. With that, I would now have Doug to review our financial results in detail.

Doug?.

Thank you, Steve and good day to everybody. I'll review the financial results in a little different order today by starting with net income since we have two non-recurring items in the fourth quarter related to the finalization of our Miltec Divestiture.

Net income was $2.8 million or $0.25 per diluted share compared to a net loss of $65.2 million or $5.88 per share in the fourth quarter of 2015.

The fourth quarter of 2016 included a negative $1.2 million pretax networking capital adjustment for which there was no related tax benefit and a $1 million tax adjustment related to the tax basis of Miltec, both negatively impacting net income. The effect of these two non-recurring items of $2.2 million after-tax or $0.20 per diluted share.

Aside from these items, the change in net income year-over-year reflects two charges recorded in the fourth quarter of 2015 at $57.2 million cash, non-cash pretax goodwill impairment charge within our structural system segment and $32.9 million non-cash pretax impairment charge related to an indefinite-lived trade name within our electronic system segment partially offset by a higher tax provision this year.

Revenue for the fourth quarter of 2016 was $142.5 million compared to $156.6 million for the fourth quarter of 2015.

The decline year-over-year primarily reflects $17.5 million of lower revenue within the company's industrial end markets due to the divestiture of our Pittsburgh facility in January of '16, the closure of our Huston operation in December 2015.

We also saw $4.5 million of lower revenue within the company's military and space markets mainly due to the divestiture of our Miltec business last March, but we posted $7.8 million higher revenue within our commercial aerospace markets reflecting new awards and increased content.

Ducommun's stock log improved to some $600 million at year end, the highest level since 2012 excluding divested operation and a rise of nearly $34 million from Q3's $566 million. This was again driven by an increase in our commercial aerospace business once more illustrating our strong position in an expanding market.

Moving to gross profit, our gross margin was 19.5% in the fourth quarter versus 14.6% in last year's comparable period. The higher gross margin was primarily due to improved product mix the Company's ongoing supply chain initiatives and improved overall operating performance.

SG&A fell in Q4 to $18.8 million from $21.2 million in 2015, this reflects our divestitures and cost cutting initiatives as well as decrease in compensation and benefit cost. For 2017, we do expect SG&A to run slightly higher closer to 14.5% of revenue primarily the result of some non-recurring executive transition cost.

Operating income for the fourth quarter of 2016 was $9 million or 6.3% of revenue compared to an operating loss of $88.6 million in the prior period.

The increase in operating income year-over-year primarily reflects the 2015 impact from the impairment charges I previously mentioned excluding these improvement in 2016 reflects higher overall operating performance.

Interest expense decreased to $2 million in the fourth quarter of 2016 compared to $2.2 million last year primarily due to lower outstanding debt as a result of net voluntary principle prepayments on the company's credit facilities.

Our effective income tax expense during the quarter was $3 million or 51.3% compared to a benefit of $25 million or 27.7% in the comparable period last year. The tax rate in the fourth quarter of 2016 was a result of one-time non-recurring items that I noted while discussing our net income.

The $1.2 million pretax negative working capital adjustment reduced our pretax income, but there was no corresponding tax benefit and the 1 million tax adjustment was related to true-up in the tax basis on the Miltec divestiture which is now finalized.

Lastly, the higher year-over-year tax rate also reflects the 2015 impairment charges previously mentioned. Going forward, the tax rate for 2017 is expected to be approximately 30% to 31%. Adjusted EBITDA for the fourth quarter of 2016 was 15.1 million or 10.6% of revenue compared to 11 million or 7.1% of revenue for the comparable period in 2015.

Now, let me turn to our segment results. Our Structural Systems segment posted revenue of 60.8 million in the fourth quarter of 2016 versus 61 million last year. The slight decline was primarily due to 2.9 million in lower military and space sales, reflecting program delays, budget changes that impacted deliveries on certain of our platforms.

The reduced military revenue was always entirely offset by 2.8 million of higher commercial aerospace sales. Structural Systems operating income for the fourth quarter was 3.2 million or 5.2% of revenue compared to an operating loss of 56 million last year.

The increase in operating income year-over-year primarily reflects 2015’s 57.2 million goodwill impairment charge as I previously mentioned. The fourth quarter or 2016 also included the impact of additional investment in new programs which reduced margins when compared to the third quarter year-to-date figures of 7.2%.

Note that due to the ramp up of platforms and impact of related investments in 2017, we see operating margins for structural systems trending in the 5% to 8% range in the very near term.

Turning to the Electronic Systems segment, our Electronic Systems segment posted revenue of 81.7 million in the fourth quarter versus 95.6 million in the prior period.

These results reflect a 17.5 million decrease across our industrial end-use market due to the divestiture of the Pittsburgh facility and closure of our Houston operation as I previously mentioned. In addition, Electronic Systems saw a 1.5 million decline in military and space revenue, reflecting the divestiture of Miltec operations.

These negative factors were partially offset by 5.1 million increase in commercial aerospace revenue, reflecting added content with existing customers. Electronic Systems posted operating income for the fourth quarter of 9.2 million or 11.3% of revenue compared to an operating loss of 27 million in the prior period.

The increase in operating income year-over-year primarily reflects 2015's 32.9 million impairment charge as I previously mentioned, slightly offset by the impact of lower revenue in 2016 due to the divestitures and plant closure discussed.

Corporate, general and administrative expenses CG&A for the fourth quarter were 3.4 million or 2.4% of the Company revenue compared to 5.6 million or 3.6% of revenue last year. The decrease in CG&A expenses was primarily due to lower professional fees of 1.7 million in lower compensation and benefit costs of 0.5 million.

Turning to liquidity and capital resources, we generated 15.8 million of cash from operations in the fourth quarter of 2016 compared to 11.6 million in 2015.

For the full year, we generated 43.3 million in cash flow from operations, compared to 30.5 million in the prior year period which would exclude the use of 9.8 million through the redemption of the single notes that were redeemed that year.

We remain diligent in working capital management and expect our net cash profile going forward to reflect historical seasonal patterns. We also paid down an additional $10 million of debt this quarter as Tony mentioned and reduced our debt in total by $75 million in 2016.

We expect to pay down approximately $25 million of debt during 2017 as we continued towards our goal of deleveraging to a target of 2.25 to 2.5 times debt-to-EBITDA.

Capital expenditure was $4.3 million in the quarter and we expect CapEx to be approximately $22 million to $26 million for 2017 driven by the expansion of our Parsons facility and continued investment in new programs as we prepare for the next generation platform ramping up later this year as Tony mentioned.

In closing, the quarter played out much as we expected and benefited from the many steps taken in 2016 to streamline our operations and focus our core business.

As Tony discussed we expect our Q1 ’17 revenue to follow the store seasonal patterns and then grow 2% to 3% sequentially each quarter throughout the year, with our strong cash flow and solid bottom line results we'll continue to pay down debt as appropriate. I’ll now turn it back over to Tony for his closing remarks.

Tony?.

Thank you, Doug. With Ducommun’s leadership now in Steve hand, I just wanted to thank our Board of Directors, our investors, our employees and our customers for the many years that I've had the pleasure of working with you.

The company has changed dramatically since I became CEO in 2010 and my goal was to lead Ducommun in a better position than when I started, which hopefully I’ve been able to accomplish for our shareholders.

As the Chairman in board, I want to continue to work with and to support Steve and his leadership team to achieve our goals for the improving shareholder value.

Ducommun could not be a company it is today without our entire team coming together to serve our customers and shareholders, in a way that is dramatically improved our competitiveness and our market position.

I’m proud to turn over the reins to see at this pivotal time in our history, where the next stage of Ducommun's growth trajectory is clearly a hand. With our company in solid shape operationally, a strong backlog and platform expansion right around the corner.

I firmly believe that Ducommun under Steve’s capable leadership is in the sound footing for 2017 and beyond. With that, I’d like to open up the call for questions..

Thank you. [Operator Instructions] And our first question comes from Edward Marshall of Sidoti & Company. Your line is now open..

Yeah, so I just wanted to -- I guess the first question I had was you gave some outlook into the Q1 and you referenced 2016 and I’m just kind of curious could you parse out what the divestitures were in the first quarter of 2016 or the revenue that you accumulated from the divestitures?.

Sure, that’s about $9 million in the first quarter for the divestitures in 2016..

Okay.

And you’ve talked about the higher costs associated with the CEO transition, do you quantify what that would be that you experience in 2017?.

No, Ed, we don’t quantify that specifically other than to say that our SG&A will be running a little bit higher this year as noted in the remarks, probably closer to 14.5% then the sort of 14.1% where we wrapped this year..

And would you break that out as far as each quarter or is this I mean is -- my understanding is it would be looked at as somewhat one time in nature?.

Some of it is spread across the year, so I would say it's party heavily weighted in the first quarter, but there will be some that comes through the second half of the year..

Got it.

And you said the Neo content, but I don’t know, did you ever quantified it, could you kind of talk about what you have on the Neo today and maybe where you anticipate that program might be as you have some bids out I'm assuming?.

Well we have a number of different applications on the Neo today and we don’t really quantify the shifted value as we go forward especially on new programs that we're developing for competitive reasons.

But suffice to say that we've won a number of applications on the Neo primarily in the titanium area, but we've been very successful and continued to be successful in our bid processes and so we expect that to be a solid program for us going forward..

Okay and you said radar racks and missile systems are coming through in 2017, I think that was a negative for you in 2016.

Is that those programs kind of waited on some, but do you kind of talk about maybe what you anticipate to happen in 2017 from a numbers perspective in those two?.

I think that we will see a pick-up on the military side, but I think that when you look at our total military business, it's going to stay in that $60 million total revenue range.

But with the pick-up we're trying to get kind of a steady state on the F-18 and the F-15, if you've noticed over the last couple of years it's been up and down due to late lead time issues from our customers.

But we're trying to get that's smoothed out this year, so that you see more of a steady state as that goes along and I guess as the confidence to say that we're going to be in that $60-ish million range going forward quarter-over-quarter. .

But it's with your mix?.

Its' a good mix, yes..

And then finally as I look at your backlog and one year record levels, I'm just trying to -- I'm curious as to, if you look at it this way I'm not sure, but the new programs and new awards that you've won over the last say a couple of years, how much of that is as a percentage of your backlog or anytime of clarity that we can kind of look at maybe your success or your battering average that you have in backlog based on what you've done over the last couple of years from new awards and programs, bids on the Neo, bids on the 737, et cetera..

I think we've done well in both of those areas as we don’t like to quantify that data because of competitive reasons, Ed. But suffice to say that the pick-up and between the third quarter and the fourth quarter was non-commercial programs and primarily new applications..

Got it. Thanks guys..

Thank you. And our next question comes from Ken Herbert of Canaccord Gennuity. Your line is now open..

I just wanted to first ask that you gave some guidance in considering the new programs and the impact for margins within the structures segment.

As I look at electronic systems, is it fair to assume now since we saw a really nice uptick in the fourth quarter does that say for 2017 we should assume double-digit margins in that business and or maybe a color around that like you provided on the structural side would be helpful?.

Hi, Ken, this is Doug. We've historically said I mean it was a really nice quarter at 11.3% margin for the year at 9.5%, so I think that range of 9% to 10% is where we see that business. It will bounce around in between quarters because of our product mix, but probably within that range as we move through 2017..

We had a nice mix in the fourth quarter and that's what gave us the uptick..

Okay.

But so clearly a bit of a maybe a nice mix, but the mix maybe isn't is good in 2017?.

I wouldn't say not as good, I would just say that it is going to bounce around. I mean the quarterly operating margins for our business, the first quarter was 8.2, the fourth quarter was 11.3. So it does move around from quarter-to-quarter depending upon the products that are getting shipped within the quarter..

Okay. That's helpful. .

We're real comfortable in that 9 to 10 range and look for uptake and we're working for that..

Okay and was -- the step down in margins and structures, was at 100% due -- sequentially 100% due to the introduction of the new content you've won and the mix there or was there anything else that happened in the quarter?.

It's two-fold, one is some of the step down as we talked about in the third quarter is really from the military side, the lower military revenue which was a little bit richer.

But we're investing heavily in the new programs and we have a number of new programs on the Titanium side as well as on the composite side, we've invested heavily in the programs and continue to do that. So we saw that little higher investment in the fourth quarter as Doug talked about in his remarks.

But we continue to see investment going forward in the first quarter and probably in the second and third quarter not as high an extent..

Oka, okay, that's helpful. And if I could just the backlog question in a different way. You obviously added about $36 million $37 million sequential step up in the backlog and as you indicated it was virtually all of the commercial aerospace side.

Is it fair to assume that step up is virtually all narrow-body which is where it seems to you've been winning significant content on the titanium side?.

Absolutely that's correct?.

Yeah, okay. Alright, that's helpful.

And then just finally Doug, what's the maybe -- sorry if you mentioned this, but what's the assumption or D&A for '17?.

If the A stays about the same, where the run-rate where we're at now, amortization of about $9 million and then the deprecation will step up with the additional CapEx probably $1 million to $2 million off of what our run-rate was this year primarily driven by the investment in the Parsons facility..

Okay that's helpful. And then if I could just one final question, maybe for Steve and obviously you've just settled in, you're going to be hitting your leverage targets depending upon how fast the EBITDA ramps mid to second half of this year.

Anything Steven you care to say around capital deployment or any thoughts you might have that as you think about the free cash flow generation and as that continuously increase as you look to use capital?.

Yeah thank you for the question. So look we still got some work to do in the first half of the year to pay down some debt. But my view is that second half of the year we're going to start looking for effective acquisitions what I called them to really increase our value and portfolio.

So I think more of coming that, but the first half is pay down debt and then we'll start moving forward..

Okay, helpful. Thank you very much..

Thank you. [Operator Instructions]. As our next question comes from Mark Jordan of Noble Financial. Your line is now pen. .

Question I thought which is more longer term on the structures side, once we get through this bubble of investment in new programs and I guess late in '17 or into '18, what should be the normalized operating margin in the structures group again once we get past this wave of investment in new programs?.

Mark, I think that after we run through these investments, we should be returning to that 8% to 9% range and driving towards the 9%, if you will. But we do have a number of new program developments going on as we indicated. But we're on, you know that’s our goal to get it back to that range and that past..

Okay. Could you talk just a little bit your Doug, that you teased with a little bit of detail on the titanium business as far as its contribution structures that moving towards sort the part of the business.

Where are you -- where were you at the end of '15? And kind of a snapshot, where are you now in terms of sizing that as the overall piece of the business?.

At the end of '15, I would say that the titanium was approximately 40% of the base, and we have three businesses that actually are working in titanium, forming and super plastic forming. So we get a combination of it.

So a lot of the helicopter work, if you remember in 2015, we were still pretty heavy in the helicopter, military helicopter sales were up and there is a lot of titanium products that are around those improvements. As they came down we replaced a lot of that with the new commercial narrow body program.

So we are moving toward at 50%, and I would say that as you move into first half of 2018 and as the rates ramp up that should be pretty close to what that number is. Now that we are working at some other new programs on the composite side that could put a dent in that but we are in the right direction there..

Okay.

Final question from me relative to you mentioned some contract delays on military side, are those issues related to delay in approval of 2017 budget, or is this just one of generic DOD moving slowly?.

It's a little bit of both, the budget -- we are still under a CR and hopefully that gets replaced by the budget. So some of it is just moving the contracts over and other is exactly as you said, just slower a little bit..

Okay. Thank you very much..

Thank you. And our next question comes from Mike Crawford of B. Riley & Company. Your line is now open..

Further to the helicopter side of your business, it looks like the house has requested in its appropriation bill a much larger number than the prior administration initially put out for the year, and I think, you said you expected that number to move toward 60 to 65 years for Black Hawks for example, but what's your opinion overall, where that business is headed for Ducommun?.

Well, I think right now Mike, the best thing for us to do is to range in that 65 to 70 ship sets. But I think that, we saw the same data that you saw in terms of the budget, and there is a good possibly that that can go up a little bit. But we are on the wait and see on that, so from a forecasting standpoint we are staying at the 60 to 65..

Okay thank you.

And then you are investment in Parsons in '17 and is that expansion expected to be substantially completed by '17 and then CapEx comes back down a little bit or what do you see?.

Yeah, that’s exactly right Mike. The expansion is largely completed as we exit ’17. So the CapEx comes back down to what I’d call our historical range, $15 million or so per year once we exit ’17 and go into ’18..

We’re expecting that continue to grow, so we will spend the capital where we need it..

As needed, yeah..

As long as you get a good investment on it [Multiple Speakers] investment.

And then final question just touching back on M&A where you said you might have some room to start working again in the second half of ’17, but effect if any are you seeing now your business now given some of the other recent consolidation in your space?.

Mike not, not much so far, I mean obviously there has been some recent activity, but we haven’t seen that has either a positive or a negative. I mean we are pretty well entrenched our customer base and unique solutions that we offer, so it really hasn’t been an impact on us thus far..

Okay, great. Thank you..

Thank you. And there are no other questions in queue. I would now like to turn the call back over to Tony Reardon for any further remarks..

Thank you, Sonia, and thank you everyone for joining us today and we really appreciate your continued interest and support. And we look forward to speaking to you next quarter. Thank you everybody. Bye now..

Ladies and gentlemen, thank you for participating in today’s conference. This does conclude today’s program, and you may all disconnect. Everyone have a good day..