Good afternoon, and welcome to the Omnicom Fourth Quarter and Full Year 2022 Earnings Release Conference Call. [Operator Instructions] As a reminder, this conference call is being recorded. At this time, I'd like to introduce you to your host for today's conference, Senior Vice President of Investor Relations, Gregory Lundberg. Please go ahead..

Thank you for joining our fourth quarter and full year 2022 earnings call. With me today are John Wren, Chairman and Chief Executive Officer; and Phil Angelastro, Executive Vice President and Chief Financial Officer.

On our website, omnicomgroup.com., we've posted a press release along with the presentation covering the information we'll review today as well as a webcast of this call. An archived version will be available when today's call concludes.

Before we start, I would like to remind everyone to read the forward-looking statements and non-GAAP financial and other information that we have included at the end of our investor presentation. Certain of the statements made today may constitute forward-looking statements, and these statements are our present expectations.

Relevant factors that could cause actual results to differ materially are listed in our earnings materials and in our SEC filings, including our Form 10-K, which should be filed tomorrow. During the course of today's call, we will also discuss certain non-GAAP measures.

You can find the reconciliation of these to the nearest comparable GAAP measures in the presentation materials. We'll begin the call with an overview of our business from John, then Phil will review our financial results for the quarter. And after our prepared remarks, we'll open up the lines for your questions. I'll now hand the call over to John..

Kathleen Saxton, previously of MediaLink, joined as Chief Marketing Officer; and Alex Hesz previously of adam&eve and DDB joined as Chief Strategy Officer.

Andrea, Kathleen and Alex will strengthen our position in the marketplace, identify and pursue new business opportunities and work with our global client leaders and agencies to deliver innovative and transformational ideas to our clients. We're fortunate to be adding this team from a position of strength.

We ended 2022 with significant new business wins and deepened our relationship with many of our enterprise-level clients. In the fourth quarter, L'Oréal named Omnicom Media Group, its U.S. media agency of record. This marked one of the biggest wins of 2022, with an estimated $1 billion in U.S. media billings as reported by COMvergence.

L'Oréal selected OMG due to its steep specialization and integration of expertise, talent and technology to deliver modern marketing outcomes.

Our recently launched commerce agency, Transact, along with our best-in-class analytics and insights team at Annalect, which supports the Omni operating system played instrumental roles in winning the L'Oréal business. Also on the media front, OMD secured a major win as it was named media agency of record for Burberry.

The win includes an innovative and bespoke agency model created specifically for Burberry. Our Healthcare Group, which had 6.4% growth in the fourth quarter, won a significant new business pitch with Merck capping off the year in which it won one of our largest healthcare pitches of 2022.

A key component of our new business success was driven by our e-commerce capabilities, an area where we've made and continue to make significant investments. We recently expanded our e-commerce capabilities through our partnership with Albertsons Media Collective, a retail media arm for the Albertsons Companies.

This partnership will provide first-to-market solutions that will enable marketers to better target and measure ROI in the connected TV environments.

Going forward, we plan to continue to invest in and expand our capabilities to solidify our position as best-in-class provider of retail, media and e-commerce services as well as in other high-growth areas such as Precision Marketing, Performance Media and Health.

I want to thank our people around the world for helping us close out 2022 on such a positive note. It's your dedication and commitment and outstanding work that allows our agencies, clients and Omnicom to succeed.

We entered 2023 in a very strong position, supported by our strong financial performance, new business wins and steady progress on our key strategic initiatives. We also continue to see strong demand for our services.

Based on current market conditions, we're targeting 2023 organic revenue growth of 3% to 5% and expect our operating margin to be between 15% and 15.4%.

At the same time, we remain extremely cautious of macroeconomic and geopolitical factors, including the ongoing war in the Ukraine, the economic risk posed by rising interest rates and higher inflation around the world.

To be prepared, we continue to actively develop plans to respond to the headwinds from macro factors, and I'm confident we can manage through this economic cycle. And we have the leadership teams in place to minimize the impact on our top and bottom lines. I'll now turn the call over to Phil for a closer look at our financial results.

Phil?.

a reduction in billings in 2022 resulting from certain client losses in 2021; disposition of our businesses in Russia, including cash for operations in Q1 of 2022; disposition of our specialty media business in 2021; impacts from increased client activity related to the reopening in China at the end of the fourth quarter; and timing differences compared to the prior year; and cash collections and cash payments at year-end.

As we look forward, we expect change in operating capital to be a source of cash again for fiscal year 2023. Slide 12 is an overview of our credit, liquidity and debt maturities.

During the quarter, the impact of foreign exchange rates on our euro and sterling denominated debt caused the book value of our outstanding debt to decrease to $5.6 billion from $5.7 billion as of December 31, 2021.

There were no changes in outstanding balances during the quarter and our $2.5 billion revolving credit facility, which backstops our $2 billion U.S. commercial paper program, remains undrawn. Our cash and cash equivalents were $4.3 billion at year-end.

The reduction relative to year-end 2021 is due primarily to the changes in operating capital that I just discussed as well as the effect of foreign exchange rate changes, which reduced our cash balance by $219 million for the year. Turning to Slide 13.

Our operating capital discipline consistently drives above-average returns on both invested capital and equity. For 12 months ended December 31, 2022, we generated a solid return on invested capital of 28% and a strong return on equity of 40%.

The strength of our business delivers attractive returns on a relative basis in both strong and weaker macroeconomic environments. In closing, as 2023 unfolds, we are prepared, as always, for an uncertain business environment.

We have a strong track record of providing attractive returns through dividends and share repurchases while maintaining a strong balance sheet and managing our business through challenging market conditions and we will do so while continuing to invest in our strategic future growth. Operator, please open the line questions and answers. Thank you..

And our first question comes from the line of Steven Cahall with Wells Fargo..

So John, maybe to start off with, you said you entered 2023 with a lot of confidence, and you're also being cautious and that caution certainly served you well last year as the macro really got worse throughout the year. You all did an impressive job of setting achievable targets.

So how should we think about the amount of kind of healthy caution that's in this guidance? And maybe related to that, as you came through the fourth quarter and into January, did you see trends that were either improving or deteriorating on a sequential basis to kind of set you up for how you're looking at the rest of the year?.

Okay. There's a couple of questions in there. Let me start with first with the guidance. In the guidance that we gave you, I'm going to remind everybody, we're five weeks into the year. 3-plus percent, I'm extremely comfortable about. There's a lot of reasons for that. There are some puts and takes, depending upon the industry that clients are in.

But on the whole, we feel very good, our client base and what their planned spending is for the forthcoming future as far as we can see it. And then in 2022, we entered the year challenged by facing some losses from '21, which we're not up against in the first quarter. And as well as Russia as to previously mentioned.

But more importantly, if you look at media wins, for instance, using the only reliable outside source, which I believe is convergence, you'll find that on a net billings basis, Omnicom won far more business in '22 than any of our competitors.

So the combination of stability in our client base, those new business wins, which will start to contribute for the most part in and around April. But April and for the rest of the year, I'm extremely comfortable.

We'll know more, obviously, as we get a little bit further into the year and have -- continue to have conversations about stretch plans with our operating divisions. But -- so that's that. Having spent so much time on that, I've forgotten your second question, sorry..

In terms of the month -- I think the second one was the month of January. So we don't -- we typically don't place a lot of emphasis on one month in any quarter. But we didn't see anything in terms of January's results that would cause us to change the commentary John just laid out..

And Phil, maybe if I could just follow up on the margin guidance. Could you just confirm if that's EBITDA or operating profit, and I know you had the $113 million adjustment in '22.

So what would be the comparable number for 2022 versus the 15% to 15.4%?.

Sure. So the number without the charge for Russia, which was about $113 million, is 15.4%. That's an operating margin percentage. Operating profit divided by revenue. So that's the guidance, 15% to 15.4% operating profit..

And the next question comes from the line of David Karnovsky with JPMorgan..

Phil, just to follow up on the margin guide. I think we're generally conditioned to see organic growth at the level that you guided to kind of filtering down the margin expansion.

So wondering if you could kind of speak to the puts and takes of the margin guide, any cost pressure that's potentially offsetting any gains that you might get from the incremental growth..

Sure. I think given the -- some of the uncertainty of the macro and business conditions currently, we certainly plan the business to align our cost structures with our expected revenues as we know them. We always have done that.

We're somewhat conservative about how we do it because we don't want to be relying on plans that have unsupported new business assumptions where we maintain a cost structure that isn't sustainable. It isn't effective and efficient in achieving our margin objectives. So we, like everyone else, have experienced some wage pressures.

But there's a number of other initiatives we've been pursuing. We're going to continue to pursue around outsourcing, in offshoring and automation, and we're pretty comfortable with the margin targets that we've laid out.

But in terms of the general macro, there are some things that may be out of our control so we've given the guidance which is 15% to 15.4%..

Embedded -- if I could just add one thing to that, embedded in that and we're not always successful, but we have added a lot more success than I would have hoped for and going back to clients and getting increases which will help mitigate that issue.

And we've also gotten a lot more sophisticated as we've gone through a couple of these recessions or [indiscernible] in that if clients are not willing to give us any smaller, what we've been able to do is to increase the length of our contracts with those clients, therefore, increasing the stability of our revenue forecast..

John, you also made in your prepared remarks, kind of e-commerce capability as playing a role in winning new business.

Just wondering if you could speak to that and maybe the increasing role retail media is playing in terms of client allocation?.

Yes. At this point, selling client products and what COVID did for online sales is never going backwards. It's only going to further increase as we move further into the future. Mergers like Krogers and Albertsons will set up a third competitor to the Walmarts and the Targets that are out there as well as the Amazons.

Budgets at sales departments traditionally had to motivate those stores to feature those products are, in essence, becoming types of media budgets. And there's a lot of overlap and convergence in terms of the skills that you need.

Having said that, there are some very special skills that you need to focus on retail and sales at that moment of notice or when you get the customers' attention. We've looked at seeing if there is much to acquire throughout '21 and '22.

But at the same time, because we were a bit hesitant, we started building it and so we've been building it for well over 2.5 years. And I think if you ask us or any of our competitors, every media request for a bid for the last several years, you have to come in and demonstrate to that potential client the strength of your e-commerce capabilities.

So it's something that we are focused on, remain focused on, and we think is going to play a very important role in future business, not only in '23, but beyond..

And the next question comes from the line of Ben Swinburne with Morgan Stanley..

John, you talked about the strength and the fill in the media business. Advertising and Media had another nice quarter, similar growth last quarter and you called out media strength. And it's interesting because if we look at the -- whether it's TV or digital advertising, things got pretty bleak in the back half of last year.

So it's clearly separation here. Could you take us inside of the advertising and media discipline at Omnicom and sort of help us understand the drivers of that continued growth in the business. It doesn't sound like new business wins really were a factor in last year's results. I just want to make sure I got that right.

And then I had a follow-up for Phil..

Let me start off, media wins, creative wins as well as media wins as well as Precision Marketing wins all contributed to the performance that we had last year. And going into last year, we were still cycling on a couple of account losses that we had, had previously. So new business did have an impact in getting us to where we were in 2022.

That strength of batting above -- at a very high average and above our weight because I think we deserve every win we got. But there was quite a bit of activity at the end-ish second half, end-ish last four months of last year. And we were very successful with it. And we continue to be successful as we go into this year on things that we announced.

And we don't have a crystal ball, as Phil said earlier, but we do have some sight in terms of accounts that are stable because we have multiyear contracts and accounts that people have got into review, maybe not become public yet or not. And we're not in a defensive mode, and it's already February.

We're still -- and we're on our front foot, and we continue to be on our front foot. So I'm very comfortable that the wins that we had in the latter part of last year will be contributing starting in the second quarter of this year, and that'll benefit the rest of '23.

And I'm also confident in the teams that we have answering these briefs and the collaboration that is not just media or just creative or just precision marketing but our holistic approach is responding to the clients' business needs.

In my reference in my first answer, to convergence for media, in truth, that's the only third party that accurately accumulates and follows wins and losses, but they only do it in the media sector.

There are a heck of a lot of wins in all the other areas of our business as demonstrated in the growth areas that you saw with the exception of COVID closing China and some other headwinds had on our execution business. But those should even -- they haven't lightened up just quite yet but they will.

In truth, China opened up extraordinarily well in that area. In the month of December, we weren't prepared to handle all the demand that there was in December. So I'm bullish on where that particular business can be as we get further and further into the year, contributing to the strength that we have across all of our other areas..

I would just add, Ben, that when we talk about growth and in this case, growth in media, it isn't just new business wins.

It's growth of existing clients, which all of our three global brands when you look at their full year numbers performed quite well in terms of growing their businesses, and there isn't a direct correlation necessarily between the media industry and/or the pricing of media and our revenue streams.

I think the more complexity there is in that landscape, and I think it's clear. It's a much more complex landscape today than even just a few years back. Retail media being one of those examples, the more complexity, the more in demand our services are..

Got it. No, that's helpful, Phil. And then maybe just -- I don't know if there's a connection between the new business wins and your margin target. So I didn't totally understand your answer earlier on why we're not -- why margins would be flat to down in a year with this much top line.

Is there some staffing up ahead of new business coming on, that's part of that. Is there anything structural change? Like if you continue to put up 3% to 5% growth in '24 and beyond, I think we should see margin expansion, but want to make sure there's nothing we're missing..

I think it's the first week in February, as John had said. And I think if we were sitting here 12 months ago, looking out at 2022, it was a very different macro outlook than it is today in 2023. And given that uncertainty, we expect there's going to be some challenges that we're going to have to manage through.

And we expect to do it successfully, and we're not going to be overly optimistic in terms of our guidance at this point..

Yes. I mean the only other thing I would add is that when we issue our K, we'll probably be -- I'm sure we'll be talking about our headcount. Our headcount definitely went up in '22. It went up throughout the year. So we are looking at a full year's cost for those incremental employees right now.

It's hard to really predict what's going to happen in the payroll environment because we're going to start to insist, you'll see some reports that we are consistently bringing people back at least three days a week. That hasn't been -- that will be finished and completed but way before the end of this quarter.

And there are costs associated with those people coming back that we haven't necessarily had to bear as we were working remotely in the past. So we're being a bit cautious, but I think we're being very sensible.

And with the Fed raising interest rates as well as some of the other challenges that are going on with the war, there are uncertainties out there. So we plan for what we know. That's not what we're hoping for.

I mean we will do everything in our power to reasonably control our costs while attracting the best and brightest people that are out there in the marketplace. And we will get some relief with some of the challenges that the tech companies are going through, but we haven't seen the full impact of that yet..

Next question comes from the line of Michael Nathanson with SVB MoffettNathanson..

One for John and one for Phil, for both you guys. One of the challenges we have is trying to figure out what's normal, right? We had '21 lapping '20 and '22 is a bit of a recovery year too, the growth was extraordinary 9%.

When you look at your revenue buckets, what businesses do you think are expecting to slow, right? Is there a biggest kind of normalization? And in your forecast 3%, 5%, is there just some acknowledgment that maybe the '22 growth rate is a bit of a catch-up? Or anything you help on looking at kind of the normalization of growth.

I'm looking at '22 and maybe Experiential, maybe there are some places that were caught up. And then Phil, can you remind me a bit of your currency and where it's moving.

Is that a positive or negative for margin? I know it's translation effect, but is there kind of a bogey on margin due to where currencies move into where it could possibly go to?.

When we look at revenue, when we look at our clients, we look at what their business needs are in terms of selling their products. So we are most interested in share of wallet as opposed to individual expertise or crafts within the marketing experience. So -- and we've gotten better and better at this, we're on our front foot.

So we're not only answering the briefs that the client isn't necessarily putting to us, we're not just answering questions. We're taking a look at their business, their sector and trying to be helpful as a partner to them in growing their businesses.

So we don't really make the distinctions other than what the accounting systems spew out is relevant to me. And in today's environment, that marketing funnel continues to collapse and there's a lot of overlap between the skills or the areas in which we call out for historic purposes.

I started off in an earlier answer, explaining how retail e-commerce type of spending and media spending are overlapping -- almost completely overlapping today. Not every client's organization has separated the responsibility for those two areas just yet.

But in essence, all those costs in all those different areas are being spent to get a great ROI and to move the client's product. And that's where our real focus is..

On the FX front or the currency front and margins, there really hasn't been much of an impact on our margins from a currency perspective, maybe 10 basis points plus or minus each quarter this year or less than 10 basis points. And that's typical when most currencies are headed in the same direction relative to the dollar. So the costs are coming down.

The revenues are coming down roughly in proportion to the change in the currency because the local currencies are naturally hedged.

So unless we get a big swing in a particular currency where the revenue drivers for Omnicom are, there's a big -- a larger change or a larger proportion of revenue coming from a market where we have an overly high margin or a lower margin than our average, we typically don't get margin swings caused by currency because of the natural hedge of our people are located in the same markets as revenue is generated.

So it's a natural hedging effect for the vast majority of our business that doesn't have any impact on margins..

Okay. And so I can ask one more. I don't think you quantified what the hit is going to be this year to divest into acquisitions to total revenues. I might have missed that.

We got the first quarter, but what's your aspect of the year of the revenue changes from divestments?.

Right now, we're going to kind of cycle on Russia after the first quarter. That was the main disposition that's still out there. And we'd expect the number for the rest of the year based on deals that are actually closed to be small, kind of close to a push because we don't have any sizable acquisitions or dispositions that are contributing as of now.

We expect that to change if we can get some acquisitions done. But I think for the balance of the year, it's going to be flat after the first quarter..

And the next question comes from the line of Tim Nollen with Macquarie Group..

I actually wanted to ask you a question about acquisitions and divestitures, too. If I look back several years, you've got six or seven years' worth of dispositions, not acquisitions. And if I go back even to about 10 years ago, you were kind of at about zero acquisition disposition for a number of years now.

So you used to be a more acquisitive company. You've clearly been clearing out some of the businesses that have not been working and focusing on organic growth. I just wonder if there might be more opportunities to go for more acquisitions.

You're not going to call what you might do in Q2, for example, but is this a more acquisitive environment emerging for you? And if so, what kinds of things might you look at?.

I think we outlined pretty much there. What the areas that we're most interested in, which I think I called out as being e-commerce, geographic expansion and skill expansion of our precision marketing group and our very strong healthcare group.

So those are areas that we're constantly scraping the market, talking to everybody, we have an entire group that's dedicated to that in terms of mergers. I think this is a generalization. So making a general statement, it's not 100% true, but it's mostly true.

And that is, I think, would be what the Fed has done in increasing interest rates, which I believe is pretty permanent. I don't think sellers have quite absorbed that yet in bringing the pricing in line to what any reasonable business person would anticipate as a terminal rate for buying an enterprise.

But we continue to negotiate and most of the deals that we've been able to do have been strategic in nature, and they have to be good family members because they have to be able to operate in the environment that Omnicom operates in.

You're correct in making -- calling out the fact that we have divested today, we're constantly reviewing the portfolio and also constantly talking to people through our M&A group who are doing roll-ups in certain areas where we've become aware of that, and we have to make decisions that, gee, this company has value to us now but are we going to double down and support it to compete with what we anticipate those roll up is going to be able to accomplish? Or are we going to just take a healthy profit and return it to our shareholders.

And that's what we've elected to do over the course of the last five years. And where an acquisition has become fall short of our standards or we deemed to be too expensive, we've not been shy and we spend a lot of money each year investing in building those businesses which are reflected in lowering our margins in many ways.

If we were running the business for any short period of time, you could stop some of those investments and increase your margins temporarily but it will hurt long-term growth.

So we are constantly looking at the present, learning hopefully from mistakes of the past, but it also with a keen awareness about where our expertise is and where it should continue to be..

If I could maybe ask one more. There's been a lot of discussion this week about AI and this ChatGPT functionality that Microsoft has been investing in. And of course -- was it last week, the week before that, we had the DOJ lawsuit against Google. These are huge topics.

I don't expect a precise answer, but just wondering if you have any initial thoughts on how these developments may affect your business in the ad market as a whole?.

Sure. We ourselves not shy, but found that interesting. We're constantly looking as a group that is looking to automate part of the functions that we perform on a regular basis. And those are some of the investments that I alluded to.

When I first became aware of chat, the first phone call I made was to the Head of PR and as I said, using historic performance, I want to test this product and see, it is good yet as it pretends to be and given an analysis from the people on the ground doing those type of tests as to how they viewed it. And they came back very positively.

It's a good product. It's not a perfect product. I think when Microsoft really integrates it into its system, it will be able to ramp up, so it doesn't crash just right now, it has a lot of people trying to play with it and use a lot of whatever is available hosting capabilities are.

But in general, I probably would have given you a different answer two years ago than I will right now. All of the automation that we're looking at enhances the capabilities and makes the job easier for our best and brightest people. And it eliminates a lot of the otherwise mundane projects or activities that we also get paid for.

So net-net-net, not everybody will love it. We'll be embracing it as quickly as we possibly can because we think it's good for our smartest people, and therefore, it will be good for what the work they do on behalf of our clients. So I'm looking forward to it.

And I'm looking forward to Microsoft getting behind it and making it something that is on everybody's desktop..

And the next question comes from the line of Jason Bazinet with Citi..

I don't want to take away from the results you guys put up because they are very good, and I heard what you said about account wins and we can all see the numbers. But your competitors are also doing remarkably well recently.

And when I listen to the words you guys used to describe why there are all these tailwinds, whether it's e-commerce or connected TV or digital transformation.

At least to my layman's here, it feels like those things have been going on as sort of trends for the last five years and yet all the holding companies are putting up great numbers sort of post COVID. And so I'm still I feel like I'm missing the thread in terms of what's really caused your growth and your peers' growth to accelerate so much.

So if you were just going to convey this to an institutional investor, and you said, if you buy Omnicom stock, you are net long what -- your just two or three things that we'd all understand exactly what's happening that's causing clients to use your services so much more than they were in the past..

The best answer is the complexity of the marketplace and the complexity of marketing itself. The whole customer journey has changed.

Technology has changed that, a lot of things which didn’t in fact exist in the Internet marketing companies existed in 1997 when I first made my first investments in them, but they weren't really perfected into social media and into Instagram and other things until the period in which you're talking about.

So if I had to sum it up in two words, and I can go deeper, if you'd like, it's businesses requirements to transform themselves in a digital environment and the complexity that brings and the reason I believe the sector is benefiting is, for the most part, not everybody, and I hope to be at the head of the pack.

But I'm happy that my competitor is doing well as well. We've changed our product and our approach to be responsive to those client requirements caused by those two broad categories..

And our next question comes from the line of Craig Huber with Huber Research Partners..

My first question, John, on pricing. Historically, this industry might not have had great pricing power on a like-for- like basis. I'm wondering if you could help us here how we think about -- how you're thinking about pricing for this year.

Do you have more pricing power in this higher inflation environment?.

Should we? Yes. Are we speaking to our clients about that? Yes. Do they understand that the best and brightest people that are servicing them can demand more because of the inflationary periods that we're all living through? Yes.

I think I tried to -- I quickly read over this in an earlier answer but we've had some very good success in going to clients and getting increases in our pricing. Not everything we want by any standard, but getting that movement and that recognition.

And clients who themselves are facing difficult times and there really are more difficult times, are really maybe not in a position to give us the level of increase that we want but we didn't stop there even and say, well, guess what, in the past, you've been able to fire us and give us six months' notice.

We want to extend our contract to be a 36-month contract before you could possibly review it, hoping that you don't at the end of 36 months either. But in getting that, in lieu of a price increase, we're able to add stability to our revenue base. So we are benefiting. One is more measurable than another.

But -- and the reason for that is because I think our product alignment is correct in terms of what the market needs are and I think our clients respect the intelligence and the sophistication of the people that we have servicing them on their accounts..

And my second question, John, for 2023, what industry sectors are you most bullish about when you compare it to that 3% to 5% initial organic revenue growth outlook for this year? Is it healthcare, travel, retail, what would you point to, please?.

Well, the one that I can point to with real confidence is healthcare. I think they're increasingly new discoveries, new products all the time in the healthcare area. I'm confident that everybody on the planet is going to have to eat food and drink beverages. So that sector of our business, I'm comfortable with.

Our tech sector I think we're going to suffer, get a little pain there, and we planned to quarter because of the payment those -- some of those companies are going through. But they'll reinvent themselves very, very quickly, and I'm very happy to have them as clients, even if they're facing challenges.

In the auto sector, I think two interesting things are going on and clients have to continue to market in order to address this. One is there hasn't been a lot of new product in the past three years because the supply chain problems which have now been, for the most part, solved by most major car manufacturers.

And the second thing, which clients have to continue to bring their brands and promote their brands in order to be participants in this area is electric cars and the requirements of that to show progress in their product. So travel, I'm not going to comment.

I can speak for the red household, nobody shied away from it, but I don't know that much about anything else. Our clients are bullish.

But everybody -- every CEO that I speak to truly believes in their products, believes in their future and is cautious and appropriately cautious about the financial conditions of central banks and the Fed and where interest costs are going to go. So hopefully, that answers your question. That's about the best I can do..

And with no further questions in queue, I'll turn it back to our host for closing comments..

Thank you all for joining us on the call today. We appreciate you taking the time, and I will talk to you again soon..

Thank you..

That does conclude our conference for today. Thank you for your participation and for using AT&T Conferencing Service. You may now disconnect..