Symbolic Logic, Inc.
Q4 2014 Earnings Call Transcript

Published: 17 Mar 2015

[Operator:]

Good day, ladies and gentlemen and welcome to the Evolving Systems Fourth Quarter and Year End Earnings Call. At this time, all participants are in a listen-only mode. Later, we will conduct the question-and-answer session and instructions will follow at that time. [Operator Instructions] As a reminder, today's call is being recorded. I would now like to introduce your host for today's conference Dan Moorhead, Vice President, Finance. Sir, you may begin.

[Dan Moorhead:]

Good afternoon and welcome to Evolving Systems 2014 fourth quarter and year-end earnings call. I'm Dan Moorhead, Vice President of Finance and joining me today is Thad Dupper, Chief Executive Officer. During the course of this call, we will be making forward-looking statements based on current expectations, estimates and projections that are subject to risks. Specifically, our statements about future revenue, expenses, cash, taxes and the Company's growth strategy are forward-looking statements. Listeners should not place undue reliance on these statements. There are many factors that could cause actual results to differ materially from our forward-looking statements. We encourage you to review our publicly filed documents, including in our SEC filings, news releases and Web site for more information about the Company. With that, I'll turn the call over to Thad.

[Thad Dupper:]

Thanks, Dan. Welcome and good afternoon. We have several highlights to cover today. First, we are pleased to report our Q4 licensing service or LS bookings were the highest of the year, led by a 61% increase year-over-year in Q4 DSA LS bookings. This shows we built momentum over the year which we carry into 2015. Another highlight was our revenue which for 2014 grew by 18%. To put that growth in context here's some industry comparisons. For 2014 Synchronous reported an impressive growth of 31%, but after that the results dropped with Ericsson reporting flat revenue, our neighbours here in Colorado CSG International reporting 1% growth, Comptel a competitor of ours in the activation space reported 4% growth, Amdocs reported 6.5% growth and our colleagues at NeuStar reported 7%. So by comparison, our 18% compares well to other industry players. It also shows our product focus on SIM activation is well placed and is driving our growth. Beyond revenue growth, another key result for the year was our profit highlighted by adjusted-EBITDA growth at 51%. So how does 18% revenue growth lead to 51% growth in EBITDA? You may think we had to aggressively cut cost to get there. But actually no, we increased our investment during 2014. For example, our R&D spend was up 23% year-over-year and we added to our overall company headcount including additional sales people which I'll come back to in a moment. In addition to working more billable hours in 2014 versus 2013, a prime contributor to our profitability was the renewal of our dynamics and allocation or DSA licenses, what we refer to as our First Use Activations or FUA license extensions. As you know many, there are not all of our DSA customers have a usage component to their DSA license. Once the number of initial activations is expended, they need to renew their license. For 2014, we had a record number of accounts 6 renewed their DSA licenses which in turn drove a record amount of FUA revenue. As you would expect the DSA license renewal is a high margin transaction which was one of the main drivers of our increase in gross margins up 7% year-over-year to a new record at 76%. And now for an update on our product areas; first, Tertio Service Activation or TSA for 2014, TSA revenue was virtually flat at 15.1 million. TSA continues to be profitable and material part of our business and we expect this to continue for the foreseeable future. An area where we see growth potential is in our mobile device enablement or MDE products. This offering is an extension of the Telespree technology that we acquired in late 2013. Our MDE product is focused on giving carriers tools that allow their subscribers, as well as enterprises to manage their data plans and data consumption, what is referred to as shared data plans. MDE allows a family to easily and frequently change their data plans, it allows data limits to put on not only individuals, say a child, but also on a specific app, so parent can limit not only how much data a child can consume over a period, but also how much usage they can consume on say Facebook, YouTube or an online game. Early indications for MDE are positive in terms of carrier interest, which makes sense as virtually every carrier has data services as a key initiative for their growth, which brings us to DSA. 2014 was a very strong year for DSA setting many new records. Starting with bookings, total DSA bookings for 2014 were up 31% to 14.8 million and license and service or LS bookings were up 46% to 11.6 million. This is the first time DSA LS bookings exceeded 10 million for a year. Total DSA revenue for 2014 grew at 48% to 14.6 million, again the first time DSA revenue exceeded 10 million for a year with DSA LS revenue alone up 50% to 11.5 million. While our overall DSA revenue and bookings performance set records, one area that did not meet our expectation was closing of new DSA customers and while this has always been important to us it is now an area of increased focus and frankly was the main driver in our decision to increase the size of our sales team. As mentioned in our earnings release today, we added a new customer in Q4. Typically we announce new DSA wins when we get them in a separate press release. However in this case our customer and our partner and this was closed via one of our SIM partners requested that we not issue a separate press release for competitive reasons. And with in mind to building the customer relationship we respected their wishes. Therefore there isn’t much I can share with you about this customer other than that they are Tier 1 carrier and they are not located in the U.S. Other DSA highlights for the year include, we activated a record number of DSA SIMS in 2014 exceeding 120 million for the year, up 59%. Under an initiative we call HALO, which stands for High Availability Licensing Option, we have improved the RAS or reliability, availability and service ability aspects of DSA as more customers come through aligning our system to activate the vast majority of their SIM cards and with over 120 million SIMS activated last year. Our system clearly has excellent performance and stability. That said, we expect SIM activation volumes to continue to grow and in general our customers are placing a growing importance on security, stability and scalability. Therefore this initiative is one we see as ongoing as we continually improve DSA. As mentioned, we have increased our investment in our sales channel. Over the last few months we have added four new sales people for a net add of two bringing to 12 our direct salesforce and let me add, so when I get off this call I don’t have an inbox of emails, when I say sales people these additions represent the hiring of an Area Vice President and Regional Sales Director level talent. We will shortly be announcing a major new component to our DSA called Smart Dealer. Smart Dealer allows a carriers’ dealer network, both the in-house dealers as well as independent dealers to easily activate, top-up, order new SIMS, perform SIM slots and even track commissions all from an Android-based smartphone app that is completely integrated with DSA. An area of increasing investment and focus for EVOL is around the monetization of the moment of initial activation or what you’ve heard us refer to as the golden moment. While the subscriber is activating the service for the first time we have a tremendous opportunity to do some clever things. We can download a carrier self care app before that matter promote any app, via our DSA app loader capability. And let me add earlier this quarter, we received our first customer order for our app loader module. But we can go much further. For example during the initial activation, we can promote cloud backup services or the insertion of mobile ads and apps during the activation experience. Both represent attractive used cases to DSA. We are finally looking into adding these capabilities either in the form of in-house development or via partnerships. In closing, 2014 was highlighted by the addition of a major new Tier 1 DSA customer in Q4, DSA SIM activation rates that increased by 59% to 120 million during the year, which helped drive DSA license extensions and new module sales, which drove an overall revenue growth of 18% and DSA revenue growth of 48% and continued across the board double-digit growth in profit with adjusted-EBITDA of 51%, operating income of 67%, net income of 47% with EPS of $0.47 up from $0.32 last year. And for 2014, we paid quarterly dividends totalling $0.42, 16% of which was deemed to return of capital. Based on our 2014 performance and investments that we made during the year and we continue to make, we are well positioned for continued growth, much of which will be driven by our DSA business. And before I turn the call over to Dan, let me just comment again on the success of the Manhattan College basketball team as they're in the NCAA Tournament again. We wish them good luck this afternoon against Hampton and then I think it will take the combined luck of the Irish and the Christian brothers to beat Kentucky which is next up on the docket. With that, thank you for attending the call today and I'll turn the call over to Dan.

[Dan Moorhead:]

Thanks Thad. I'll begin with a review of our fourth quarter financial results. Revenue in the fourth quarter increased 16% to $7.6 million from 6.6 million in the same quarter last year. License and services revenue increased 22% to 5 million from 4.1 million last year, while customer support grew 5% year-over-year to 2.6 million from 2.4 million. Total cost of revenue and operating expenses decreased by 15% in the fourth quarter to $5.1 million from 6 million a year ago, the decrease reflected $560,000 in restructuring charges and $200,000 in transaction and integration cost both related to our Q4 2013 acquisition of Telespree Communications. Our lower expense base coupled with higher revenue led to a 355% increase in operating income to $2.5 million from $500,000 a year ago. GAAP net income in Q4 increased 99% to $1.6 million from 800,000 in the same quarter last year. As a result, diluted EPS grew to $0.13 versus $0.07 year-over-year. Adjusted-EBITDA grew by 119% in Q4 to $2.7 million from 1.2 million in Q4 last year. Now for our full year results, total revenue in 2014 increased 18% to $29.7 million from 25.1 million in 2013. License and services revenue grew 23% year-over-year to 19.7 million from 16 million and customer support revenue increased 9% to $9.9 million from 9.1 million. Total cost of revenue and operating expenses for the full year were up 6% to $21.2 million from 20.1 million in the prior year. The majority of that increase are related to investment in sales and product development which Thad mentioned earlier. Higher revenue more than offset increased cost of revenue and operating expenses resulting in a 67% increase in operating income to $8.4 million from 5 million in the prior year. GAAP net income increased 47% year-over-year to 5.6 million or $0.47 per diluted share from 3.8 million or $0.32 per diluted share a year ago. 2014 was our eighth consecutive year of positive net income. Adjusted-EBITDA grew by 51% year-to-date to $9.4 million from 6.3 million a year ago. Bookings and backlog, we define bookings as sales orders that are expected to be recognized as revenue during the following 12 months. During fourth quarter, bookings were $7.7 million up from 7.4 million in Q4 last year. On a year-over-year basis, LS bookings were unchanged at 5.2 million, DSA LS bookings increased 61% to 3.7 million from 2.3 million, TSA LS bookings were 1.4 million versus 2.8 million and customer support or CS bookings increased 16% to $2.5 million from 2.2 million. Full year booking, total bookings in 2014 increased 8% year-over-year to 28.3 million from 26.2 million, LS bookings increased 12% to 18.4 million from 16.4 million. DSA LS bookings grew 46% to 11.6 million from 7.9 million. TSA LS bookings declined to 6.8 million from 8.4 million a year ago. And CS bookings were up slightly at $10 million versus 9.9 million a year ago. Total backlog at December 31, 2014 was down 13% to 10.6 million versus 12.2 million last year. Our year-end LS backlog was affected by a record FUA and SaaS revenue from Telespree which typically booked a revenue in the same quarter. A larger percentage of our LS bookings during 2014 were FUA and SaaS and therefore were not part of the backlog at year-end. LS backlog totalled $5.6 million and included 4.1 million in DSA and 1.4 million in TSA. CS backlog was 5 million virtually unchanged from 5.1 million last year. On the balance sheet, cash and cash equivalents at December 31st, were $9.8 million, down from 13.8 million at 2013 year-end. The decrease in cash is primarily related to the timing of billings and collections on contracts. Working capital increased 7% year-over-year to 15.8 million from 14.7 million. Dividend update, our Board of Directors declared a first quarter dividend of $0.11 per share payable March 31, 2015 to stockholders of record on March 24, 2015. I'll close with our usual reminder that a single order can have a significant impact on our quarterly results. Accordingly, we continue to advise that it's more accurate to judge our performance on an annual rather than quarterly basis. With that, we thank you again for joining us today, and we are now happy to take your questions, operator?

[Operator:]

Thank you. [Operator Instructions] Our first question comes from Mike Crawford with B. Riley & Company. Your line is open.

[Mike Crawford:]

Thad the 18% revenue growth and 51% EBITDA growth was impressive in 2014. You had 8% bookings growth in the year, so what’s that leading you into 2015 would you say that the -- well how would you characterize the probability of growing say the top-line double-digits in 2015?

[Thad Dupper:]

We don’t give guidance, but I think you're forecasting that. We did it this year. We have a good comp in Q1. Our Q1 last year at 6.6 million was pretty low when you look at the trailing four quarters. So, we like to product tag and we like to extend its sales team, so clearly we’re driving that and we should be able to -- well let me say we shouldn’t be able to but our goal is to certainly achieve that.

[Mike Crawford:]

Given that you have slightly higher cost now with the Director level sales representatives would you expect continued operating leverage in 2015 and also in conjunction with that maybe you can talk about the gross margin which was as you mentioned over 76% in the quarter and over 74% in the year?

[Thad Dupper:]

Yes, and so you're right, our OpEx is up a little bit, Dan can comment on it, but we’ve made investments. So, we have a few more sales people, we have a few more developers, we’re investing in the business. The byproduct of that is we have a bigger bag to sell in terms of products, this MDE product, these new modules with DSA and then we’ve added a few sales people so we have better coverage. So OpEx is up, but we expect revenue to be up and one of the things that I think everybody has coming to learn is our ability to produce profit is pretty good. So, we expect to continue to post good margins, gross margins, EBITDA margins, op income margins. The other thing that I would say is 2014, just like ’13 was a good example of the power of the licensing model, when we add these license renewals, these FUAs they really do drive good profitability and we expect to get FUAs again in 2015. So, I think the profit is not the challenge, the challenge for us always is let's get the orders and then convert the orders to revenue. So, I am not so worried about profitability, our focus is let's go get the new names, convert the funnel from opportunities to close sales and then once we have that say closed in the backlog there, we have a high confidence we can convert that to revenue and the revenue usually shows a pretty good margin in terms of EBITDA and gross margins.

[Mike Crawford:]

Just a couple of more if you don’t mind, on the getting the order front, you had several carriers and pilot, it sounds like one closed, can you comment on the status of some other pilots you had? And also how many carriers do you expect to bring online with DSA in 2015 versus how many you did last year?

[Thad Dupper:]

So a couple of points there, you're right one of our trials did convert into a closed deal in Q4, you're right about that. We had another trial that we’re confident we can convert into an order. We just met with the executives in Mobile World Congress. So now we’ve got to get that paper done and that’s work to be done. So, our sales teams as you know the last two weeks of any quarter are out chasing a lot of deals, collecting a lot of paper. So that’s one of the points. The second point in terms of putting new customers in production. So we have 10 customers in production today. We have put two customers in production in Q1 and we’ve got a couple more to go, but then we’re going to have to get these new customers, these new deals to drive that number up. So, the good news is we’ve done a good job of taking the new orders we got four new accounts in 2013 and we've converted I'd say all of them into production or momentarily into production. Obviously this Q4 customer is going to take a little time and then after that we may have one or two laggards we've got to put into production, but then it's going to be up to closing new deals and putting them into production. And we're confident we can do that. I think we have probably some confidence to restore as they're closing one new account for 2014, but again looking at the funnel for 2015 and what we've committed to our Board, I think we're going to get back to more regularity in terms of closing new accounts.

[Operator:]

Our next question comes from James Moorman with D.A. Davidson. Your line is open.

[James Moorman:]

So with -- it certainly it's great you got the first DSA app loader, but is that a product that you kind of expected to probably ramp a little bit more by now? And any feel for, if that's kind of building steam now? And then also any progress that you're seeing in general with getting into connected cars?

[Thad Dupper:]

So two good questions Jim, app loader, we do think there's good momentum in that product and just coming off that show at Barcelona Mobile World Congress I can tell you a lot of the customers we have talked to are very keen on downloading apps and just doing more sophisticated things at the moment of activation, so we like this feature. We're glad we got our first order. We like this new feature on Smart Dealer and we like this product direction in terms of perhaps offering cloud backup at the moment of initial activation and/or -- and we were very excited about this, the insertion of mobile apps during the golden moment. So we like all those torpedoes if you will and we're working very hard on all of them. In terms of connected car, we commented on a trial that we began last quarter. It's ongoing. It's in an area that is suffering a lot of currency fluctuation which is the comment that Dan may want to talk about, but FX in general, we're generally insulated against it. We were pretty well insulated in 2014, but in 2015, we do have a few markets where we have some fluctuations, you'd agree with that, right Dan?

[Dan Moorhead:]

As we've seen downturn in obviously in the Russian ruble and in some currencies in Africa as well.

[Thad Dupper:]

But yes, we like connected car, we like connected devices in general Jim, but app loader is a near-term project we're working on and this Smart Dealer again that got very good reception at mobile worlds where we did some early preannouncement briefs, so we like the product direction we like the product set and we like the larger salesforce, so now it's up to us to go and execute right.

[James Moorman:]

I guess one last question. In terms of backing to the FUA anything you can give us in terms of -- you had a really strong year last year anyway to kind of handicap that against last year at all?

[Thad Dupper:]

Well it was a good year last year and we're going to get FUAs again this year. I do think when you look at our model and this is why the Board is so clear in their direction is we have to close new deals to continue to grow that FUA revenue, so I would say the leading indicator the Bellwether for DSA -- and we're very pleased 61% order growth, 48% revenue growth for the year. We like the new modules as you've heard me comment on several times, but we have got to go get the new names and the new names will then eventually lead to additional FUAs. So with this only one new account in 2014, we've got to go drive additional new accounts before we start seeing the slope of that FUA curve start to get steeper, because our customer base has been a little steady. So we love the FUAs in 2014. I think we'll like them in 2015.

[Operator:]

Our next question comes from Kevin Tracey with Oberon Asset Management. Your line is open.

[Kevin Tracey:]

There's been a fair amount of press about the use of reprogrammable SIMS in the new iPads although the carriers don’t seem to have embraced them yet, but there's also talk of new software SIMS in the future. And I'm just wondering if you could talk about how this new technology compares or potentially competes with DSA?

[Thad Dupper:]

So we net and we dialogued with quite a few SIM manufacturers as you'd imagine and while DSA is material to us I mean SIM revenues to these people are life making or taking, whether the SIM is a piece of plastic or it’s software and logic on a device it still needs to be activated, just like when you go into a hotel room and you connect to the Wi-Fi, you're not changing your component, but there is a process that takes place to activate that card. So we believe the functionality that DSA provides, whether it's a individual piece of plastic or activating software and a service on a device will perpetuate, so we look at and assess them as a potential and an opportunity and not a threat. In terms of what Apple is going to do, obviously I can’t comment on that, I would say the Apple SIM has been a little confusing and maybe in its first version a little less robust than perhaps in its full function. But this is something we keep an eye on. But again helping carriers activate subscribers is what we do and whether it's software and plastic or software in the device, the Smart Dealer, the connected car, the smartphone or the tablet, we think we have an expertise in that area, we can help carriers activate those subscribers.

[Kevin Tracey:]

And then it’s just to clarify with the FUA revenues, would you be willing to say whether based on your model you expect them to grow next year or grow this year in 2015 or not?

[Thad Dupper:]

I would say given the trajectory of the new accounts this year, as I said last year we loved it, this year we like it. We probably think FUAs this year is a flattish year not an up year. But again I want to be careful as we add new accounts, we expect that trajectory grow, but it was very-very strong last year. Now what wasn’t strong last year was the addition of new accounts. So, we think we can add quite a few more new accounts than what we did last year. So, to our plan given to us by the Board is for a growth year for both revenue and EBITDA and that’s where we’re marching towards.

[Operator:]

[Operator Instructions] Our next question comes from Brian Kinstlinger with Maxim Group. Your line is open.

[Brian Kinstlinger:]

Just a couple of quick ones on first, how many customers were live with DSA and came to ’13 and then ’14 I know you have 10 now?

[Thad Dupper:]

We had a quite a few in ’13 I don’t have the number of the top of my head. But I would say we have 12 now, but two of those just came in Q1. We ended the year with 10 and I want to say we added maybe three, maybe four into production in 2013, it's in that range.

[Brian Kinstlinger:]

And then can you talk about how much revenue FUAs produced in the quarter and also in ’14 over ’13, so we can get a sense of the impact it had?

[Thad Dupper:]

That was significant, we don’t break it out and we are reluctant to, one of the things we’re breaking out and I am glad you bring it up is in the new press release that we have put out today Dan you put out some tables that show trends that we think will help our investor community in general. So do you want to comment on what those tables represent and why we added it?

[Dan Moorhead:]

Well what we did was we wanted to assist analysts and other readers to give them better information. It's tough to get information out of the press release and the call itself. So, what we’re trying to do is get better trended data, so that you guys can see it going forward. But the FUA information would be within the DSA LS line item within those -- that was in that supplementary data.

[Brian Kinstlinger:]

And when you add a new customer like you did in the fourth quarter, how long did it take in general for DSA customer a; to go under production; and then what do you generally put in the backlog, the services piece or the services and the initial order?

[Thad Dupper:]

So I will touch the first part and then we’ll ask Dan for the second part. So, I would say in general it takes about a year to put a customer in production from getting the order. We have examples where we did it faster, where the carrier was driven to put that in and I think maybe the closest or the fastest we’ve done was maybe four months. We’ve had a couple of cases where it's languished, where either management changes or changes in priorities or the system relying on changes in other infrastructure has been delayed. But I would say in general 12 months is probably a good run rate. Now in terms of the backlog, I’ll let Dan answer that.

[Dan Moorhead:]

So what happened Brian is that as the order came in and we typically have a license component and a services component it is just for example we said the license was 500,000 and the services were 500,000 just to make it easy it would be a $1 million order that would go in the backlog and then that would come out of backlog and go into revenue on a percent complete basis or as the hours of the deliverables were delivered to the customer.

[Brian Kinstlinger:]

And then one more on a new customer on average you get 10 that have been installed for sometime what is the average time it takes for them to use up their initial order once in production and generally you have to buy an FUA obviously it ranges, but what’s the average time?

[Thad Dupper:]

Yes, you're right it is a little different each one, but on average we’d say it takes about a year to put the customer in production and then typically where FUAs exist in the license that tranche usually less than about a year in production, sometimes it's actually limited calendar wise to a year. But typically the first year is part of the original license and when I mean first year, I mean the first year in production.

[Brian Kinstlinger:]

And then you talked about your growth rate, can you give us the organic growth rate of DSA either license fees and services especially, but maybe overall DSA for 2014?

[Thad Dupper:]

Yes, so DSA revenue for 2014 grew by 48%, so.

[Brian Kinstlinger:]

That’s all organic?

[Thad Dupper:]

There was a little bit of M&A in there, but not much. We had fully integrated Telespree rather and that's reported in DSA, but it's small, so we don’t break it out and it's integrated. But their lion share of that was organic.

[Brian Kinstlinger:]

And then maybe can you give us -- can you characterize your backlog? You mentioned that you're more confident. You can get back to normal customer wins this year similar to '13 as opposed to '14. What gives you that confidence? Is it more advanced discussions with a number of these potential customers? Is it they have put the priorities -- sorry, they changed priorities or finished other projects like technology projects? What gives you that confidence you'll get back to those three or four years...?

[Thad Dupper:]

We very tidily managed the funnel and a DSA deal just like it takes a year to put it into production, typically it takes us about a year to close a DSA deal. So we see these things coming from far away. And there's a pretty defined process that you can see. And often times customers issue an RFP. Then after the RFP response goes in there may be a shortlist. If we get shortlisted then there's a negotiation. And then once the decision to purchase has been made then we go through the close process that could take three months in terms of contracting give or take. So we can see it coming. And because of that and you know the dialog we're at, at those various stages with different prospects, we have a greater or a lesser degree of confidence on where we are. The other thing that I would say is as we put more of these systems in production, we get a bigger reference base in the community and we've had a couple of instances of executives transferring, changing jobs and going to a new carrier and saying the carrier I had just put in this new system called DSA, we should look at it. So one of the things we're expecting is the more DSAs we sell, the more industry references we have as this typical changeover in the sea levels in the carriers we get other opportunities where we may have sold this executive before and now he is in a new operation. So we think long-term and I think I measured this in years. We're expecting the sales cycle for DSA to get shorter. And we think that's a good thing and we think that's based on more customers put into production, more references these new features we add to the product and then CTOs and CEOs is talking and they're saying this is a better way to manage and activate your SIM inventory and we get a bigger reputation and it just accelerates the funnel and the sales cycle. So that's a long answer to your question I think.

[Brian Kinstlinger:]

Last question I have. You activated or put into production two more DSA. It sounds like in this current March quarter, should we expect that pop in revenue to begin really in the June quarter?

[Thad Dupper:]

No, I think the answer to that question is the two customers who went into production in Q1 were really at the tail-end of the revenue of the initial order and the project. Now what we can get from those customers is starting to recognize maintenance or warranty and we can start getting upgrades from them. But the revenue from the original project, it maybe a little less but there wasn’t much left by the time we go into production. And then in terms of FUAs for those customers, I think one is they have got a potential to give us revenue this year and the other one I think it will take all of this calendar year if not longer to finally get to where we need to be on revenue on that one.

[Operator:]

So I'm showing no further questions. I'd like to turn the call back to Thad Dupper, CEO for closing remarks.

[Thad Dupper:]

Well thank you again for joining us today. It seems like Q4 was a long time ago. So we're glad to get those results out there and now as you'd expect we're very focused in the coming two weeks to close the quarter. And we look forward to sharing those results with you in the early to mid-May timeframe. Everybody enjoy yourselves enjoy the tournament and thanks for joining us again today. Cheers.

[Operator:]

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