Renovare Environmental, Inc.
Q4 2018 Earnings Call Transcript

Published: 2 Apr 2019

[Operator:]

Good day ladies and gentlemen and thank you for standing by. Welcome to BioHiTech Global Year-End 2018 Financial Results Conference Call. At this time, all participants are in a listen-only mode. A brief question-and-answer session will follow the formal presentation. [Operator Instructions] As a reminder, this conference is being recorded. Before I turn the call over to the company, I want to remind listeners that during the call, management's prepared remarks may contain forward-looking statements that are subject to risks and uncertainties. Management may make additional forward looking statements in response to your questions today. Therefore, the company claims protection under Safe Harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995. Actual results may differ from results discussed today and therefore we will refer you to a more detailed discussion of these risks and uncertainties in the company's filings with the SEC. In addition any projections as to the company's future performance represented by management included estimates as of today, April 1st, 2019 and the company assumes no obligation to update these projections in the future as the market conditions changed. This webcast and certain financial information provided in this call are available at www.biohitech.com on Investor Relations' page. I will now like to turn the call over to Mr. Richard Galterio, Executive Vice President for BioHiTech. Please go ahead Mr. Galterio.

[Richard Galterio:]

Thank you operator and good afternoon listeners. Welcome again to the BioHiTech year-end 2018 financial results conference call. In addition to myself, with us today, are Frank E. Celli, our Chief Executive Officer and Brian Essman, our Chief Financial Officer. I'd like to start-off by providing a brief overview of our business progress in 2018, followed by a more detailed discussion of our financial results from Brian Essman, and then we'll turn the call over to Frank, our CEO to provide an overview of our growth strategy as we move through 2019. During the year, we achieved 38.7% revenue growth seeing improving year-over-year metrics in our food waste digester business in overall rental revenue, number of units deployed, and gross margin. While topline revenue was modest at 11.1%, actual unit growth was 86.8%, reflecting the acceptance of our less expensive Revolution Series Digesters. In fact we shipped a record number of units in 2018, and with our pipeline of business, Frank will discuss later in this call, we were excited about where this business is headed in the coming years. The largest driver of revenue growth in 2018 came from our management services to Gold Medal, a regional waste management services company operating in the mid-Atlantic region. This business relationship offers many synergistic opportunities for our technology and provides a revenue stream with almost no incremental cost that was new to 2018. Revenue from digester sales declined during the year, reflecting our focus on the rental model in the U.S. While our financial performance improved in most key areas, 2018 was a transformative year for BioHiTech and our HEBioT business as we completed several key strategic initiatives to set the stage for substantial growth in 2019 and the years to come. First, our HEBioT development subsidiary acquired a controlling interest in the nation's first HEBioT resource recovery facility in Martinsburg, West Virginia through a series of transactions with our Italian technology partner as well as Gold Medal. As you are probably aware our HEBioT facilities utilize a patented high efficiency mechanical and biological treatment process that produces an EPA-recognized solid recovered fuel that can be used as a partial replacement for coal in various industrial applications. I am pleased to announce that as of this past Friday, March 29, our Martinsburg facility has commenced commercial operation. Having a consolidated interest in this facility was a critically important goal for us and we thank our partners for their help in making this a reality. This flagship 56,000-square foot facility will serve as a model for other locations and we look forward to its financial contribution in 2019 and for many years to come. Second, we received $5.5 million from Gold Medal into our HEBioT development subsidiary consisting of $3.5 million in cash and assets valued at approximately $2 million. In exchange, they received a 40% stake in that subsidiary. Gold Medal is a portfolio company of Kinderhook Industries, a private investment firm that manages over $2 billion of committed capital and is very active in the waste management and renewable resource space. Our HEBioT development subsidiary will serve as the platform for BioHiTech's planned U.S. HEBioT rollout which will be part of our strategic discussion later in this call. And third, we received local permit approvals from the City of Rensselaer, New York to site a 72,000-square foot HEBioT municipal waste recovery facility on 23 acres of land in the city's southern industrial area. This plant facility is expected to generate approximately $12 million of high margin annual revenue. We are currently in the state permitting process and anticipate completing construction of this facility late in 2020. In our digester business, we received a patent that we believe creates a major competitive advantage for BioHiTech as we now have the only integrated solution to measure food waste volumes directly from a disposal unit over the Internet. On the business front, we partnered with Delaware North, one of the largest privately held hospitality and food service companies in the world. That partnership led to a Sustainability Initiative Award for our Revolution Series Digester installation at Miller Park, the home of Major League Baseballs, Milwaukee Brewers. We also received validation of the environmental benefits of our digester technology from the University of Delaware that determine using our food waste digesters reduce CO2 equivalent emissions substantially compared to composting and other popular methods. This independent data helps improve awareness, backs our claims, and helps our marketing efforts significantly. At this time, I would like to turn the call over to Brian Essman, our Chief Financial Officer to discuss our financial results.

[Brian Essman:]

Thank you, Rich and good afternoon to everyone. We achieved 38.7% revenue growth in 2018 with total revenues of $3.4 million as compared to $2.4 million in 2018. Year-over-year growth was driven by our management services revenue from Gold Medal as well as by a 11.1% increase in recurring revenue from our digester rental and data analytics platform. As Rich mentioned, the number of units under lease contract grew by 86.8% to 170 units, reflecting the successful deployment of our less expensive Revolution Series digesters. This growing market acceptance led to a 29.5% year-over-year increase in the company's forward, single upcoming years minimum contracted rental revenue. While revenue related to our digester business has shown consistent growth, our shift to focusing on larger opportunities and establishing distribution relationships with food services and traditional waste services companies has lengthened the sales cycle. Our pipeline of multiple unit opportunities has grown substantially, and we expect to see the results of these efforts become more evident in mid-2019. Gross profit in 2018 increased by 134% to reach $1.7 million with gross margin increasing by 20.8 percentage points to 51.2%. The primary drivers for the increase in gross profit include the addition of our Gold Medal management services revenue, which through the leveraging of our existing management team, has not resulted in incremental costs, and a 5.7 percent point increase in gross margin from our digester rental and services business which reached 31.3% as we benefit from a greater base of revenue generating units in the field and less maintenance expense associated with our Revolution Series Digesters. We continue to expect rental margins to remain in the 30% to 35% range as our install base grows and our unit mix shifts to the Revolution Series Digesters that require less maintenance. The gross margin from equipment sales decreased by 13.5% to 26.5%, primarily as a result of the de-emphasis of unit sales and fewer high -- higher margin direct sales. It is important to note that we typically only contract unit sales in certain reseller markets, mainly international where leasing models are not common. The operating expenses in 2018 decreased by 6.1% to $6.9 million compared to$7.3 million in 2017. The decrease in operating expenses is mainly attributable to a $1.3 million decrease in professional fees which totaled $914,000 in 2018 compared with $2.3 million in 2017, which were partly offset by $739,000 increase in labor-related expenses that included $496,000 of an increase in non-cash stock-based compensation. Our loss from operations decreased by about 23% to a loss of $1.5 million when compared to 2017. Now to our balance sheet. With the completion of the transactions Rich highlighted earlier, we ended 2018 with $2.4 million of unrestricted cash and shareholders' equity of $10 million. This compares to unrestricted cash of $910,000 and a shareholder deficit of $11 million as of December 31st, 2017. The significant improvement in our balance sheet was a result of the acquisition of our controlling interest in the Martinsburg facility, the mandatory conversion of debt into common stock upon achieving our NASDAQ up-listing in April 2018, as well as the conversion of additional debt into equity during the first quarter. I will now turn it over to Frank to discuss our growth strategy as we move forward into 2019.

[Frank Celli:]

Thank you, Brian. While we achieve meaningful revenue growth and diversification of our revenue stream this past year, 2018 was a transformative year in laying the foundation to build significant financial growth in the future. We've made great strides in this area, so I'd like to take you through some of these objectives and how we see this setting us up for 2019 and well into the future. We often talk about how our goal as a technology company servicing the waste industry is to change the way we think about managing waste. And our task at hand is to demonstrate how our technologies fold into the traditional model. With our Revolution Series Digesters, we established a new customer base and a much larger market opportunity with both direct customers and important distribution channel partners. Our partnership with Gold Medal has helped us to show the waste industry how embracing technology can help win business and make money by giving the customer what they want, cost-effective landfill diversion. We also won some direct business from other waste management services companies that has helped us open meaningful dialogue with some of the largest companies in the industry. One of those conversations led to our recently announced distribution agreement with a nationwide waste management services company and we expect it will not be the last. We made a decision in the second half of 2018 to actively pursue this distribution model and we're excited about the prospect of these relationships in the coming years. We've entered a new phase of growth where we're now seeking larger unit opportunities, which is lengthen our sales cycle, but we believe this will lead to a marked acceleration of unit deployment in the second half of 2019. With our acquisition of a controlling interest in the Martinsburg facility, we now have a clear path for meaningful revenue growth in 2019 in our HEBioT business. We're making significant progress in Rensselaer where we're in the state permitting process and expect to bring this facility online in late 2020. We're also moving down the road with several additional sites to create a pipeline of development projects with a goal of bringing two facilities online each year in the coming years. Having the Martinsburg facility is helpful -- helping to accelerate this process as we now have a place to show potential customers including municipalities, waste management services, customers, and retailers just how things should be done. To give you some scope, we've already toured more than 70 people in these categories over the last few weeks. Our success here led to Kinderhook-backed Gold Medal investing in the future of this technology and we're excited to work together to forward this vast business opportunity. These facilities generate significant high margin revenue with each plant potentially adding $8 million to $15 million annually and generating about 50% to 55% EBITDA margins. As Rich mentioned earlier, we began a commercial operation in Martinsburg last Friday. As a result, we now expect to pick-up three quarters of revenue from its operations. Because the feedstock and solid recovered fuel is under contract, these operations will ramp quickly. And with anticipated revenue from our management services and digester business, we see full year 2019 revenue of $10 million, representing about 300% increase over 2018. We also expect to reduce our cash burn to under $2 million, which would represent more than a 57% improvement from 2018. Before I turn the call over to your questions, I'd like to thank each and every one of our employees for their dedication in helping us to position the company for sustainable long-term growth. I'd also like to thank our investors for entrusting a portion of their investment dollars in our company. We're confident that we're in the right place at the right time to have a positive impact on our environment, while generating significant long-term value for our stockholders and we look forward to building on the positive momentum we've generated in 2018. Operator, this concludes our prepared remarks and you can now open the calls to questions.

[Operator:]

Thank you. [Operator Instructions] Our first question is from James Jang with Maxim Group. Please proceed.

[James Jang:]

Hey good afternoon guys. Hi Jamie.

[Richard Galterio:]

Hi James, how are you?

[James Jang:]

So, Frank, you guys did zero equipment sales in the fourth quarter, correct?

[Frank Celli:]

Yes, that is correct.

[James Jang:]

Okay. So, we should look at that as no more equipment sales moving forward, because I know you guys are making the switch, so--?

[Richard Galterio:]

We've been making the switch I believe -- James this is Rich. We said a couple of quarters ago that our equipment sales are going to be lumpy. They're going to be -- one quarter they're going to be one number one quarter, they're going to be the next number. We really don't -- we aren't emphasizing it, so typically speaking in the food services business, you don't have a lot of activity in the digesters in their busiest time of the year which is the end of the year cycle, so it's a situation where we're not emphasizing that market. So, as sales come in, they come in, we're not walking away from it, but it depends on where those sales fall, so we may pick-up sales at some point in time from our international distributors, and we really don't know where they're going to come in. We aren't necessarily assuming that they're going to be no sales moving forward, but that 26% decline or 27% some decline we had this year wouldn't be something that would be out of the ordinary to continue with that pace over the course of the next several years.

[Frank Celli:]

Yes James, James this is Frank. Remember our Revolution Digesters which we introduced last year, we kind of drew a line in the sand with our sales team and said, hey, we're just absolutely not going to sell those units. They're a low cost product. They're inexpensive which is why we're seeing volume, quantity of units ramp-up. But we did draw a line in the sand other than international distributors that we would try not to sell Revolution Digesters, which made up a significant portion of our deployed units in 2018. So, I would expect to see sales be a small part of our revenue stream other than like Rich said, international distributors where we don't want to carry the assets on our balance sheet.

[James Jang:]

Okay. And can you just remind us how many units were sold to Miller Park and to Temple University?

[Frank Celli:]

Miller has got I think a couple, Temple I want to say has three right now James.

[James Jang:]

Yes, so do they have a capacity to expand? Is this like initial phase they want to test the waters or--?

[Frank Celli:]

Absolutely. I mean certainly a ballpark could use more than a few digesters, no question about that. We think that the award they won -- in fact, did we just -- another stadium or something. Yes, the award that they won is starting to -- the word is starting to spread around to other stadiums as well as we also have the Philadelphia Eagles who've got multiple units. So, yes, we think stadium venues can potentially grow new customer-wise and further penetration within those customers. But I think there’s never going to be a 100 unit location, maybe they'll have a half a dozen, I would say, on a maximum. Universities is a different story. So, we're seeing progress with not only Temple, but other universities what I would say -- I won't name them, but in the Gold Medal footprint who are trying to ride the coattails of Temple. So, a university could potentially ramp up to five or six or seven units. We think Temple's got the ability to grow a little bit more, but again not going to be a 50-unit deployment.

[James Jang:]

Yes. No, so like with Temple -- so, I mean what is the catalyst for them to say, okay, we have capacity for three more, let's bring it on like what should we be looking for there?

[Frank Celli:]

What would we be looking for or what would they be looking?

[James Jang:]

Yes, like what would be the catalyst for them to order additional digesters?

[Frank Celli:]

I mean, there's multiple catalysts, right. One is -- and this is kind of a tug -- a little tug of war between the engineering people and the sustainability people, but the primary driver for Temple was certainly the environmental impact and the sustainability. So, they seem to certainly started with one, they went to two, they went to three. So, as they kind of achieve success with the existing program, it seems they'll add a cafeteria or a dining hall at a time. In Temple because of where it stands, it’s also a cost saving opportunity for them as well. But I would say the main driver in the universities is more the sustainability than it is the economic benefit.

[James Jang:]

Okay. And with the mix -- okay, so we don't know where the next plant is going to be, but if we assume it’s Rensselaer, what should we be looking for in terms of timeline and cost, investments, BioHiTech's cash outlay?

[Brian Essman:]

Sure.

[Richard Galterio:]

Yes. Just to start with, we are in a state permitting process in Rensselaer, so Rensselaer certainly is the farthest along and we would expect that getting the local permits is probably a lot more difficult than getting the state permit. So, assuming we go through the process, we're expecting to have that facility complete construction as we said in the call late in 2020. Now, that particular facility given the fact that we have had Gold Medal's investment into our launch facility, we have I would say most of the capital required. Keep in mind if you remember we got -- we purchased the license from the Italian engineering firm. We've done a lot of the [indiscernible] the engineering work. There's still some work to be done from an expense standpoint, from a cash outlay standpoint Frank, how much more do you think we might have to spend on that?

[Frank Celli:]

So, that facility will be a bigger facility than West Virginia James.

[James Jang:]

So how much bigger?

[Frank Celli:]

About 25% bigger. So, it'll be physically larger. It'll also have a higher throughput, so it'll cost more just because it's bigger. That facility will probably end up being $35-ish million or so. We would expect that the equity in each plant, sort of as a rule of thumb, is probably going to be in the 20% to 25% range or so but that would include that the purchase of the license that Rich -- in this particular case, we already own one fully paid license which is a $6 million contribution that we can make -- or we'd anticipate making as part of the equity contribution. So, cash equity, again, depending on what the credit looks like what we can get from a senior perspective, $2 million, $3 million let's say of additional cash equity, the bulk of which will be spent on preconstruction engineering, architectural plans, and stuff like that.

[James Jang:]

Okay. What about -- so will there be a bond issue?

[Frank Celli:]

I don't--.

[Richard Galterio:]

There's a number of different ways that we're exploring in terms of handling the rest of it. Municipal bond is certainly one of them; project finance is certainly another one. It will be some sort of debt component. What that ends up being will depend on the state; will depend on where we can go and what we can get now that one facility was up because keep in mind, getting the first facility up which we got with municipal bonds now that we'll be able to have some models and some ability for financers to kick the tires a little bit, the project financing should be a lot easier. We're probably in the West Virginia one that would have been virtually impossible. So, we're exploring those options. We expect to come to some sort of decision in the third quarter because that's going to align with when we're looking to start bringing this thing physically moving. So, it's still a little open, but you can figure some sort of debt what that will look like in the end, we're not a 100% sure.

[James Jang:]

All right. So, quick math is about $24 million in debt, all right. So, with -- can the Hook be able to come in?

[Frank Celli:]

No, I don't think, Kinderhook's not typically at a debt provider, James. I think the debt looks--

[James Jang:]

Well not -- I mean will they be able to come in for more equity on that plan. I mean is there--?

[Frank Celli:]

I mean -- look Kinderhook is -- Kinderhook and BioHiTech are -- we're partners, right, we're attached at the hip, so the objective that we have collectively BioHiTech and Kinderhook is to expand that that business. They are an equity fund, so logically speaking, you would think that both Kinderhook and BioHiTech would kind of pro-rata contribute, but I can't -- we can't speak for the guys right now -- we're not at that stage yet, but what we do know is that whether it's Kinderhook, whether it's an offering we do it at the at the PubCo or whether as Rich said, we've got conversations with plenty of project finance funds that would fund any additional equity as well. I'm not -- I have little to no concern about financing the next facility. I think its smart money says we take the best money we can take, right, what creates the most value for our shareholders. And for Kinderhook as well what creates the most value for them in their limited partners. We may get offers that make sense to take other than using our own money. So, it's up in the air right now.

[Richard Galterio:]

I will tell you that with Kinderhook also keep in mind because of their footprint and where they are, they represent a feedstock provider. So, we're talking with Kinderhook in Philadelphia and some other areas -- Gold Medal, and when I say Kinderhook, I more mean Gold Medal in this point because Gold Medal has feedstocks. They represent an opportunity for us to be partners in a multitude of ways which is some of the synergies that we talked about. So, there's lots of things to explore and we intend on exploring them all as we build each facility and look to make the arrangements for both feedstock and offtake.

[James Jang:]

Okay. And on the balance sheet, so are you guys looking now to do some type of refinancing because you have a line of credit out there, you have some related party notes. Are you guys looking at doing some type of revolver in place where you have currently?

[Richard Galterio:]

We always are exploring different opportunities to streamline our balance sheet and streamline our debt. There is -- we have financial partners on the debt side. We've Michelson Capital and Comerica; they've been great partners to us. And we're happy to have them on Board and what's great about them is they always have an ear and I think if we have some business opportunities and some things that we can do, they are strategic resources for us as well. So, we're obviously always looking to do what's financially best for the company, but we're certainly happy with the partners that we have now both on the debt side and the equity side.

[James Jang:]

Okay. And then the restricted cash, what is that related to?

[Brian Essman:]

That's related to the West Virginia bonds, a lot of it is debt service. Some of it is reserved for specific operating activities, its traditional muni stuff.

[James Jang:]

Yes. Okay.

[Frank Celli:]

Hey, James we got a couple other calls left. So, if you want we can arrange a call either after tomorrow or whatever you want, we can discuss anything you want in more detail.

[James Jang:]

All right. That works. All right. Thanks guys.

[Frank Celli:]

Thank you, James.

[Operator:]

Our next question is from Vincent LaBarbara with Network 1 Financial. Please proceed.

[Vincent LaBarbara:]

Okay. Thank you. Hey Frank, BioHiTech team, I want to congratulate you on your Martinsburg, West Virginia plant, I know how important that was. And it's great to be the first one in United States to have it. Congratulations.

[Frank Celli:]

Thanks Vince.

[Vincent LaBarbara:]

Can you just give me an additional breakdown of what the revenues look like in these HEBioT facilities?

[Frank Celli:]

Yes absolutely. So, I'll sort of use -- I'll use West Virginia as the model, but generally speaking, there's still solid waste management facilities. So, the bulk of the revenue at any of these facilities regardless of where they're located is going to come from the tip fees that we that we receive at the facility itself. So that's -- whoever the feedstock provider may be, the fee that they pay to bring their trash to the facility and dispose of it. So, that's going to always be the bulk of the revenue. You're talking about give or take 70%-ish or so in West Virginia. In areas like Rensselaer where the tip fees tend to be higher than West Virginia, that revenue as a percentage of total could be as high as probably 80% or so. So, the bulk of the revenue will be contracted tip fee revenue give or take 70% to 80%. From there, there's really two other revenue streams, one is the sale of the fuel which will represent give or take about half of the remaining 20% or so -- 20% to 30% and then it's the recovery of recyclable materials, so mainly metals, aluminum and steel, that's extracted from the incoming waste stream. So, that can vary a little bit depending on the market, depending on the tip fees. But generally speaking, 70% to 80% of our revenue is contracted revenue coming from tip fees, give or take 10%-ish or so, maybe 15% is contracted fuel sales and the remainder will be kind of market commodity driven.

[Vincent LaBarbara:]

Okay. And that's 70%, 80% of the revenues, that's coming from the tip fees which are the long-term contracts?

[Frank Celli:]

Yes. I mean that's the business model is -- these sustainable sort of types of projects often fail because they don't have their revenue locked up under contract. So, in West Virginia, we've got the overwhelming majority of those tip fees under 10-year contracts where hauler has to either deliver the waste or pay us. So, we want to lock that in for some period -- long-term period 10 years in West Virginia. Going forward, that's kind of the business model. We want to know that we're going to be full every day and we can churn cash every day.

[Vincent LaBarbara:]

Right. Do you see the same model being successful for you in Rensselaer?

[Frank Celli:]

I do, yes, I do. I think it's going to -- the model may change slightly. So, Rich referenced earlier with our relationship with Kinderhook and Gold Medal in the event we were to site a plant in an area where we have feedstock directly within our control. Essentially it's an arm's length contract with ourselves, but we're not limited to that. So, in Rensselaer, we don't have a footprint. We would likely partner with either municipalities to bring their feedstock or large regional haulers that may not have other disposal options available to them.

[Vincent LaBarbara:]

Okay, great. Thank you very much Frank.

[Frank Celli:]

Okay. Vince thanks.

[Operator:]

Our next question is from Ron Nash with Nash Partners. Please proceed.

[Ron Nash:]

Yes good afternoon. Earlier somebody mentioned about in the Digester business, we're going to have some larger opportunities. Can you give us a little color what you're referring to in that -- in the Digester sector?

[Frank Celli:]

Hey Ron, how are you? Sure. Yes, we've made a -- well, we're fortunate enough that we believe we've made a significant enough impact in the market to where some of the larger providers of waste services and I won't name them specifically, but have come to realize that they're losing business to a smaller technology provider that they otherwise would have had under contract and that fortunately for us, that's sort of gotten their attention. So, we announced recently a contract with a national provider of waste services. It's a very logical business model where we would utilize their distribution capacity. So, where they have thousands of customers that could potentially use our technology and potentially hundreds of salespeople out in this -- in the field. That's a better way of distributing our product than us knocking on doors ourselves. So, we've been working on this for years trying to make an impact. Our success with the Gold Medal model showing that we can sort of integrate our technology into a traditional company has had an impact and a couple of new contract wins that we've got direct from customers has also had an impact. So, we believe that these relationships are going to lead to a much faster adoption. Some of the contracts that we are in negotiation with now are sort of larger deployed retail customers like grocery chains where they typically use a national waste provider and they've carved out pieces of business for organics to deal with our tech -- us as a technology provider. And that's had an impact on some of these national waste companies. They are losing business every day to a technology provider. So, it's kind of like, if you can't beat them join them, for them. So, our technology offers them the ability to offer a cost-effective solution to their customers, to leverage our existing salesforce, and to not lose out on business from their customers. The other thing is just today, we saw that New York State passed some new legislation that will be a food ban for the entire state approving that any generator of food waste of a certain amount more than two tons a week has to have a diversion plan in place. And our technology is an approved diversion plan. So, we also have -- still have that regulatory tailwind behind us to where some of these large public-traded companies don't have a solution. So, look, we want to be a technology provider. We don't want to be a traditional waste company. And if partnering with some of those big national companies gets our product out there quicker, we're happy to do it.

[Richard Galterio:]

Yes. And Ron just to add a little bit color when we're looking at, as Frank said, some opportunities in the 20 to 100 unit range, one of the things that increases that sales cycle is in many cases we're being asked to talk to or integrate with their waste providers because they're carving out a section of their food waste for us. So, that's helped to increase the sales cycle which isn't the greatest thing in the world for us. But what it's also done is literally had -- it forced almost conversations with these waste service providers to say, hey we've got to integrate this and this is business we're losing as a result of our ability not to provide some sort of technology solution to get the customer what they want. So, that's been helpful and that's also helped us get this distribution model directly with the waste industry going a little bit -- with a little bit of momentum. So, we're excited about that.

[Ron Nash:]

Lot of things on the plate coming up, it looks like.

[Richard Galterio:]

Yes, we're excited and certainly we're growing revenue substantially and we're going to look to keep doing that for a pretty long period.

[Ron Nash:]

All right. Good luck you guys. Thank you.

[Richard Galterio:]

Thank you.

[Frank Celli:]

Thanks very much.

[Operator:]

Ladies and gentlemen, we have reached the end of our question-and-answer session. I would like to turn the call back over to management for closing remarks.

[Richard Galterio:]

Okay. Once again we'd like to thank everyone for your interest in our company and listening to our year end call. We look forward to talking to you again as we report our first quarter and sort of discuss our progress a little bit further. And thank you once again and we'll talk to you in a few weeks. That concludes our call.

[Operator:]

Thank you. This concludes today's conference. You may disconnect your lines at this time and thank you for your participation.