GTY Technology Holdings Inc.
Q3 2021 Earnings Call Transcript

Published: 7 Nov 2021

[Operator:]

Hello and welcome to the GTY Technology Holdings, Inc. Q3 2021 Earnings Call. My name is Hannah, and I’ll be your operators today. There will be an opportunity to ask questions at the end of today’s call. I will now hand over to John Curran, CFO, to begin today’s presentation.

[John Curran:]

Thank you. Good afternoon, everyone. I’m John Curran, GTY’s CFO. And I’d like to welcome you to our third quarter 2021 earnings conference call. With me on today’s call, TJ Parass, GTY’s CEO. We will be presenting slides on today’s call, and encourage you to view the presentation found on our website at www.GTYTechnology.com. Please note that our earnings release is also available on the GTY website and contains additional information about our financial results. Any forward-looking statements we’ve made in the earnings release, any that we may make during this call are based upon information that we believe to be true as of today. Things often change, however, and actual results may differ materially from those projected or anticipated. Please refer to our cautionary statements in the earnings release under the heading forward-looking statements. You should also refer to our SEC filings, including our most recent Form 10-K and our subsequent SEC filings for a list of risk factors applicable to GTY, including risks associated with COVID-19. As you will hear in our comments, the pandemic is impacting our business today and for an undetermined time into the future. During the call, we may refer to non-GAAP financial measures, if we believe they’re useful to investors, or if we believe it will help investors better understand our results or business trends. You can see a reconciliation of our non-GAAP financial measures to their nearest comparable GAAP financial measure in Exhibit 2 of the earnings release, and in the appendix of this slide deck. With that, I’ll turn the call over to TJ.

[TJ Parass:]

Thank you, John. Good afternoon and thank you all for joining us. For those that are new to GTY, GTY provides cloud-based platforms that help government organizations transform the way they engage citizens and manage their operations. While the common perception is that government lags behind private sector, GTY was formed based on the founder’s vision that governments were starting to accelerate their digital transformation. Even before the pandemic, governments were moving away from heavy, monolithic on-prem solutions to modern cloud with SaaS applications. And this trend has gotten even stronger in the wake of last year. State and local governments modernization represents a massive opportunity for native cloud and SaaS-based platforms. Here’s how we’re going about it. We’re providing our best of breed cloud technologies through 5 product suites that cover the front and back offices of state and local governments. Included in our primary target sectors are municipalities and counties, colleges and universities, K-12 school districts, public healthcare agencies, public utilities like water and power, transportation and transit, state governments and federal agencies. As of today, we have over 1,850 clients and approximately 400 employees across the business units, with both of these numbers increasing weekly as they’re leading into growth. To add some color to the size of our opportunity, in 2021 state and local government in the U.S. is expected to spend just under $120 billion in IT. Total IT spending is growing at a healthy 7% for state and local. And within that, cloud spending is growing at more than twice that rate, as more organizations continue to shift workloads to the cloud. As our customers are starting to modernize their infrastructure, GTY is well positioned to capture the opportunity that the transformation to the cloud represents. Let me unpack that a bit for you. Before I describe the product suites themselves, it’s important to understand that GTY products have 3 broad characteristics that position us for success. First, they are cloud and largely SaaS. This means, highly recurring revenue streams with remarkably low churn, often multiyear contracts, strong growth margins and predictable cash flows. Second, each of our product suites were created specifically for government’s unique requirements and are considered leaders in their respective functional areas. This leads to high win-rates against older gov-tech competitors as well against horizontal players that often struggle to meet compliance or government-specific feature requirements. Finally, combined, our product suites allow us to access the full spectrum of sizes and segments from our customers from $10,000 to $1 million, and higher price points. And across 8 of our sub-sectors with small municipalities, all the way up to large state governments and federal agencies. So, let’s meet the products and business units. First is Bonfire, a next generation sourcing and procurement platform. Second is CityBase, our payment platform that helps centralize the citizen interface of a government agency. Third, eCivis provides a grant management platform that helps governments stay on top of one of their most important sources of funding. Forth, Open Counter streamline government permitting, which is one of the major touch-points with citizens. And finally, rounding out our product suites are budging platform companies, Questica and Sherpa, which we collectively call GTY Budget. Budgeting is a core and mission-critical financial activity of all levels of government. Combined, these product suites give GTY a strong starting position to capture the opportunity ahead. With that context for the newcomers of GTY, let’s turn to Q3. GTY reported one of our best quarters as a public company, highlighted by the large city-based kiosk installation with a Detroit-based diversified energy company, DTE Energy. The rollout of these kiosks was completed ahead of schedule. We are excited about the momentum we are seeing in the market, as the economic environment for our customers continues to improve despite challenges that persist from the new Delta variant of COVID-19. The core strength of our business is our ARR, which remain robust in the quarter yet again. Our ARR growth rate of 25% in Q3 was slightly ahead of last quarter, as well as Q3 of last year. More importantly, we have been able to deliver consistently solid mid-20s ARR growth for 8 consecutive quarters. Turning to bookings. Q3 improved greatly from Q2, as we close all deals that’s of Q2. Year-to-date, our bookings are in line with expectations and we expect Q4 remain in line or better. As we have stated in the past, the exact timing of deals is somewhat hard to predict. But we are seeing a strong pipeline of opportunities and a solid momentum in the market. During our quarterly business review, I was extremely pleased with the sheer number of deals each business unit has closed, too many to discuss. So I want to highlight some more of these impactful deals. In total, we added 74 new clients with wins across all 8 of our target sectors, as well as many customer expansions, additionally, the average ARR per customers consistently growing, up 3% quarter-over-quarter and 13% from a year ago. Our CityBase business unit continues to implement payment solutions with new customers as well as expand with current customers. In Q1, we signed a large multi-million dollar deal with DTE Energy. That was roughly half kiosks and half subscription revenue. We originally expected the kiosk implementations to take place evenly over Q3 and Q4. We’re excited to report we were able to execute on this project faster than expected to finish the installations in Q3. The key here was CityBase implementation team and I’m extremely proud of the job the team has done. The team has been laser focused on gaining efficiencies during the implementation process and increasing customer satisfaction. The only downside as we pulled about $400,000 of revenue from Q4. In other CityBase news, we continue to expand with great customers like Lawrence, Indiana, after introducing 24/7 self service payment kiosks last year, the city has also launched mobile friendly web payments. The finance and customer service teams at the city can research, report and reconcile transactions made online or via kiosk. CityBase solutions provide the city a centralized revenue management solution, which provides greater efficiencies and better customer service. Our cloud-based budgeting tools, Questica and Sherpa have been selected by a wide range of organizations and went live in the quarter with the city and county of San Francisco, the State of New Mexico and the State of Idaho. Questica has partnered with Washington School Information Processing Cooperative, or WSIPC to offer a budgeting solution, so therefore, more than 300 cooperative member districts. WSIPCs purchasing program through an official RFP process, awards contracts to technology vendors like Questica, which enables K-to-12 organizations, a streamlined purchasing process of modernizing school districts. We are pleased to be supporting this organization and look forward to connecting with each member district and solving their pain points and replacing legacy budgeting systems with Questica budget, performance measurement and open book transparency solutions. Our grant management platform, eCivis continues to move up market from small nonprofits to larger state local governments. During the quarter, we signed with State of Rhode Island to a statewide grants management contract, they expect to implement this over the coming quarters. A few other notable deals were King County, Washington, a few tribal governments, and the Alaska Department of Transportation. Additionally, we completed 2 major implementations

[John Curran:]

Thank you, TJ. As TJ mentioned Q3 was another excellent quarter highlighted by revenue that exceeded guidance and continued improvements in our operating results. For Q3, our GAAP revenue increased 29% to $16.3 million, compared with $12.6 million in Q3 of 2020. On a non-GAAP basis, revenue was $16.4 million for Q3 of 2021, compared with $12.7 million in Q3 of 2020, an increase of 29%. A reconciliation between our GAAP and non-GAAP results is included in Exhibit 2 of our press release and in the appendix of our slide deck. We’ll provide a more detailed explanation of the change in revenue on a subsequent slide. Our third quarter 2021 GAAP gross profit was $10.3 million or 64% margin compared with $8 million in Q3 of 2020 or 63% margin. Our third quarter non-GAAP gross profit increased to $10.9 million or 67% margin, compared with $8.3 million, or 65% margin in Q3 of 2020. Continued growth in our recurring revenue is driving the improvements in our gross margins. Turning to our operating expenses, we saw a $400,000, or 4% increase in our operating expenses in Q3 of 2021 compared to Q2 of 2021. We saw about $150,000 of currency impact in the quarter. Excluding the impact of currency, we had about $550,000 of expense increases in the quarter, primarily related to additional headcount. Our third quarter 2021 GAAP operating loss was $8.5 million, compared with a loss of $7.9 million in Q2 of 2021, and a loss of $7.3 million in Q3 of 2020. Our third quarter non-GAAP operating loss decreased to $100,000 compared with $1.1 million in Q2 of 2021 driven primarily by growth in revenue and improvements in gross margin. Consistent with previous quarters, we wanted to provide a little more color on the change in non-GAAP revenue. As you can see in this chart, our recurring revenue grew by 3% on a quarter-over-quarter basis and grew by 29% on a year-over-year basis. Adjusting for seasonality in our payments business, our quarter-over-quarter recurring revenue grew by 7%. Services and other increased by 55% on a quarter-over-quarter basis, and 28% from a year ago period. In Q3 of 2021, we recorded $1.2 million kiosk revenue, primarily associated with the DTE Energy installation, which provided a significant boost to our services and other revenue in the quarter. Our current services backlog remained strong. And we expect our services revenue in Q4 to be at similar levels compared to Q3. Our service revenue can vary from quarter-to-quarter due to the timing of large projects. And we expect professional services to decline as a percentage of revenue as our base of recurring revenue continues to grow. Other revenue includes sales of kiosks and software license sales that we also expect to decline as a percentage of revenue over time. We continue to expect recurring revenue to grow in the mid- to high-20% range for the year, and expect our services and other revenue will grow in the high-teens compared with 2020. Our recurring revenue growth should continue to be higher in percentage in dollar terms than service and other revenue, as we continue to forecast growth in our base of subscription business. Taking a look at our balance sheet. There are three areas we would like to discuss. First, change in our receivables increased by $1.3 million this quarter, driven by higher renewal invoicing. The second area is a decrease of $300,000 in accounts payable and accruals in the quarter primarily due to invoice timing. The third area is deferred revenue, which increased $1.2 million also due to renewal invoice timing. This increase represents the amount we’ve invoiced in excess of the amount of revenue we earned in the quarter. Taking a look at our balance sheet, there’s only one material change that I would like to discuss. This would be the change in our receivables. It’s decreased by roughly $1 million this quarter, driven by strong collections. From a cash perspective, we started the quarter with $15.4 million and ended with $15.3 million in cash. From an inflow perspective, our cash from operations was approximately $900,000 this quarter, a $1.6 million increase from an operating burn of $700,000 in Q2. The change of working capital was an inflow of $700,000, primarily driven by strong AR collections. From an outflow perspective, we paid $500,000 in interest, and $800,000 for a royalty payment associated with a Questica acquisition that occurred prior to the formation of GTY. This is the final installment of contingent consideration for that acquisition. Based on our reduced burn rates and our current forecasts, we believe we have sufficient cash to support our growth initiatives as well as our ongoing operations through 2022 and beyond. Turning to our outlook for the fourth quarter and full year 2021. For the fourth quarter of 2021, we expect total revenue to be in the range of $16.3 million to $16.8 million approximately 25% growth year-over-year at the midpoint. For the full year 2021, we expect total revenue to be in the range of $60.5 million to $61 million or approximately 24% year-over-year growth at the midpoint. From an operating loss perspective, we expect our loss to be in the range of $2 million to $2.5 million for the fourth quarter of 2021. For the full year, we expect our operating loss to be in the range of $4.7 million to $5.2 million. As TJ mentioned, we’re seeing improvements in our market outlook. We anticipate increased investment in the fourth quarter to support increasing demand. However, given the ramp time for new resources, we don’t expect to see any material benefits to our top-line in 2021. Given these investments, our operating expenses will be increasing in the fourth quarter to fund our growth initiatives for 2022 and beyond. Obviously, this will affect our operating cash flow forecast for the fourth quarter, which we now expect to be negative, driven by our hiring plans. With that, I’d like to turn things back to TJ.

[TJ Parass:]

In summary, we are very pleased with the third quarter, with GAAP revenues up 29% of the quarter and ARR growing 25% over a year. As we enter the final quarter of the year and start planning for 2022, we were feeling good about our market opportunity and look forward to increasing our investments to meet the needs of our customers in 2022 and beyond. I’m continuously amazed by the quality of the products we bring to the public sector, our high NPS scores and loyal customers. Personally, I want to thank all the staff at GTY for their hard work and dedication to helping bring the public sector into the cloud. With that, I want to thank you all for your time today. Operator, would you please open up the line for questions?

[Operator:]

Thank you, both. We have now reached the Q&A portion of today’s call. Our first question today comes from Joshua Reilly of Needham. Your line is open, please go ahead.

[Joshua Reilly:]

All right, thanks, guys. Congrats on the strong quarter. Maybe we can start off with getting a little more color on RFP activity. Has it returned to kind of pre-COVID levels? And maybe what’s kind of the general level of confidence with customers at this point now versus maybe like 6 months ago? And then secondarily, how should we expect the dispersal of these ARPA funds over the next year? Should we expect somewhat of like a steady spending? Or could there be an acceleration of opportunities next year?

[TJ Parass:]

Okay, thanks. Thanks, Joshua, for the question. TJ here. So I’ll answer the first part. With the RFP activity and general activity has increased in the second half of the year compared to the middle of the year, and certainly since last year, during the pandemic. We believe there is a number of factors that are fueling that. So one of them is that our customers are increasingly – we’re starting to put first of all COVID behind us. It’s looking further and further in the rearview mirror. We are seeing the – funding starting to flow, the CARES Act funding that started last year, and now the ARPA funding is starting to flow, where – remind you also that the number of our deals are not necessarily going to RFP. So overall pipelines and transactions have been in terms of deals coming through, have been steady. But we’re looking at that pipeline and see it growing. A lot has to do there because of the ARPA funding. And so, looking at the next year, to answer your question on the funding, the ARPA funding, we can see the rest of the CARES Act money being used, and also ARPA funding starting to gain momentum now. So just like all funding rounds we’ve experienced in the past, it takes a little while for our customers to figure out how to use it. And it takes a little while for us to learn how to speak with our customers about it. We’re just starting to see the first few deals coming through using ARPA funding.

[Joshua Reilly:]

Okay, great. And then, I’m curious, what are you seeing now in terms of payment volumes returning nationwide for CityBase? And then, maybe you can talk a little bit about how the implementations for the Denver and Austin deployments are going. And then, how many payment cases you’ve got up and running in these locations and maybe how that could drive revenue over the next year?

[TJ Parass:]

I’ll tackle the implementation question and turn the transaction volume over to John. We’ve had a very concerted effort with CityBase. The team has come together, really looking at honing down on how they go from contract to deployment. Like we mentioned in this call, excellent work by the team to really get super focused on how to get from contract to transactions happening. I think 6 months for DTE Energy. And rolling out that number of kiosks, which is a significant amount was remarkable. So, this has to do with all the with the CEO, Mike Duffy. He is also working with our COO and their implementation team and an excellent results.

[John Curran:]

And, Josh, this is John. With regard to kind of transaction volumes, we’re continuing to see if we kind of break it into two parts, the way you asked the question around activity with existing customers, the ones that are – no one’s fully implemented, but the ones that are substantially implemented. We are seeing volumes improve. They’re not back to normal yet. We’re still – just got a little room to go before we get back to normal. But we are continuing to see improvements in transaction volumes there. With regards to Denver and Austin. We have both of those customers online. So we’ve brought a number of their scheduled payment streams online on schedule. To TJ’s point upon implementation work with CityBase, the team there is doing an excellent job. They’ve got a lot on their plate, and they’re hitting their milestones and deadlines. There is still more activity to bring on board. So we’ll see continued growth with those customers, as we move forward in Q4 and into next year. The implementation timelines are lengthy with CityBase for these larger customers, because there’s multiple streams to bring online. So we have to kind of do that in an orderly fashion, based on customer availability.

[Joshua Reilly:]

Okay, great. That’s helpful. And then, maybe just one more for me. Clearly the setup for next year looks pretty attractive here. I’m just curious, how do you think about accelerating the sales investments now hear in the fourth quarter? And then, maybe the implications for that for cash burn relative to your expectations, kind of going into next year?

[John Curran:]

Sure. So TJ said in his comments, we did make some headway with our hiring in Q3. But we were behind our plans, right? So we added net 22 heads, over 13 in sales and marketing. So we made good progress in the sales and marketing heads. But still behind to our expectations for the quarter. We have a big number that we’re going after in terms of hiring in the fourth quarter. But we’re happy with the progress we made in the third quarter. It does give us incremental capacity as we look forward to 2022. And as you said, the market environment is really warming up. We feel good about the market opportunity as we roll into 2022.

[TJ Parass:]

Yeah. Josh, the only think I’d add to that is that, we had discussed in the last quarter that our goal was to add about 20 new people to the sales and marketing team, and while we’re behind on the total amount of staff, but we want to add the – that we made some good inroads on that 20 people. We got about 13 of them onboard now. I also kind of just want to point out we’ve also brought on our first cross-selling director to start working on the cross-selling efforts.

[Joshua Reilly:]

Great. Congrats on the quarter. Thanks, guys.

[John Curran:]

Thanks, Josh.

[Operator:]

Thank you. Our next question comes from Rudy Kessinger of D. A. Davidson. Your line is open, please continue.

[Rudy Kessinger:]

Hey, guys, thanks for taking my questions. I want to kind of narrow in on the recurring revenue ex payments. There is one of the weaker sequential growth rates that we’ve seen, is there anything in particular the call out there just in the quarter something maybe seasonal? And then also as I look to Q4, just – if I assume kind of that maybe a bit more muted seasonal jump in the payments revenue. But also, like you said sort of similar levels on services and other that also implies kind of another week sequential Q3 to Q4 in the recurring revenue ex payments, is there anything that call out there that is contributing to that strong growth?

[John Curran:]

So Rudy, if we – so Q3 is a seasonal low point, right, so of the quarter-over-quarter, if we adjust for the seasonality and payments, our recurring revenue grew 7%. So the quarter-on-quarter growth rate is solid. And on track are aligned with our year-over-year growth rate in our recurring business of 29%. So we’re happy with our quarterly trajectory on the recurring part. So, in looking forward to Q4, we do see anticipate seeing the typical seasonal bump in payments, as you point out, still muted by the pandemic. But we will see a step function increase in the payments business from Q3 to Q4, for the Q4 related volume change. So our expectations for the year are in line with where we wanted to be from a recurring perspective, high-20s in growth on a recurring business.

[Rudy Kessinger:]

Got it. On the sales addition, TJ, I want to make sure, I’m clear, I think you said previously, you’re looking to do a 20% increase in sales capacity. And, I think, you just said a moment ago, there’s 20 heads, and maybe they’re both true. But is that – you should be think that as those 13 heads then represent a 13% increase in sales capacity or just trying to get clarity on that?

[TJ Parass:]

Yeah, that you’ve got about just exactly, right. So we’re looking at about 20 people, which represents about 20% increase in our sales capacity, sales and marketing capacity.

[Rudy Kessinger:]

Okay, got it.

[John Curran:]

We got 13 of those 20 on board now.

[Rudy Kessinger:]

Got it. And then the cross-sell director that you just brought in, what’s kind of your expectation, I guess, both near-term and longer-term. I mean, what’s kind of his – the goal for him over the next 6 months? What kind of cross emotions are looking to establish, which kind of products do you think fit best together for joint sales motions, just kind of give me the overview of what your plans are for him, near and, I guess, more longer term to?

[John Curran:]

Right. Yeah, so joined us, has done this before in the gov-tech sector, has a very prescribed way that she wants to approach this. But, if you ask me, where we’ll probably see some natural fits, there’s no question about budgeting and grants, companies will work together, they already have a combined salesforce, and sell to the same department. We’re also seeing some opportunities between Open Counter and CityBase on the payments and then permitting, because permitting often lead to payments. They’re working together. And, I think what Julie is like the facilitator that brings those 2 together, working with the sales team. So it’s a little early to necessarily talk about what are – what this is going to do for the company. We want to kind of walk it through the first few months, and then always start talking about it somewhat later.

[Rudy Kessinger:]

Got it. And then just lastly, I got just quick one last one in. On the ARPA funding, you said it’s been used the purchase the first couple of deals hasn’t been used to purchase anything outside of eCivis yet, or is it been isolated just eCivis sales so far?

[John Curran:]

So far, the ones I’m directly aware of our eCivis. I was speaking with our CRO earlier today. He said that there are a number of deals in the pipeline that outside the eCivis that have ARPA funding possibilities with them.

[Rudy Kessinger:]

Got it. Great, helpful. I’ll jump back in the queue.

[John Curran:]

Thank you.

[Operator:]

Thank you. Our next question today comes from Jeff Van Rhee of the Craig-Hallum Capital Group.

[Unidentified Analyst:]

Hey, guys, this is on for Jeff. I think most of mine has been hit here, but just kind of at a high level. Is there anything that you’d call out anything unique in the makeup of the pipeline, anything in size that looks different now than it did say 6, 12, 24 months ago?

[TJ Parass:]

Well, John will jump in on this one also. But my impression and certainly as you saw in the presentation ARR, net ARR is increasing. And so, we’re seeing that we’re moving more up market, I would say like we’re seeing bigger and bigger deals. We’re seeing more of these multimillion dollar deals coming in. And in general, as our sales teams are maturing that movement up market is moving in the right direction for us. So that’s probably the biggest change and makeup in my opinion from what I’m seeing in the market right now. John, do you want to add to that?

[John Curran:]

Yeah, I echo TJ’s comments, definitely seeing a consistent trend in larger transaction sizes. And, again, given kind of the robust stimulus dollars we’re seeing from the government, of course, we’re seeing an increase in inbound demand for eCivis or grants management platform. So they’re probably seeing things are very warm for them these days. But we’re also seeing solid increases in pipe across the business unit.

[Unidentified Analyst:]

Awesome. Thanks. That’s helpful. And then one other one, I don’t want to beat a dead horse here on the ARPA funding. But any sense, as far as any kind of concern, or anything you’re seeing with customers? I know there’s a lot of confusion kind of lack of clarity about what ARPA funding can be used for. Are you seeing any of that play through in conversations that sales teams are having? And then kind of what’s your take on the potential risk of maybe ARPA funding not coming through the way that people are expecting?

[TJ Parass:]

Yeah, I think there’s a couple of dimensions. Sorry.

[John Curran:]

Yeah, go ahead, TJ.

[TJ Parass:]

Go ahead, John. Okay. Sorry, I think there’s a couple of dimensions to look at an answer for that. And I think this is very typical, what you see when funding comes out like this. Back to 2008, when the CARES Act was out, and then the last CARES Act, and now ARPA. It takes time for the government to figure out how to use it. We saw with the CARES Act funding, for instance, this shows you largely to help with COVID. But some of our customers, they were start using it for kiosks, because that helped with hands-free transactions. And so, I think what you’ll find is that ARPA, which actually is a little bit more open than how you can use it. Our customers will figure that out. The second dimension, I would say on this answer is that even if they are not directly allocated towards us or allocating some of their spend towards something else that helps them free up some of their budget, to look at projects like ours. So I think it works in 2 ways for us. And certainly, historically, it’s been always helpful for ourselves and pipelines when these grants come out, back to 2008, and certainly last CARES Act, and we expected that ARPA they’ll be even more – considering it’s more open than the last two. John, sorry.

[John Curran:]

Yeah, no, I would agree. We are seeing based on our conversations with our sales teams and our customers, we are starting to see the money flow, right? Our customers are commenting that money is flowing. And which you can read in the news, because it is very early days For the trickle down of ARPA. It has a multiyear lifecycle for ARPA. So we do anticipate that we’ll see that flow of money increasing as we go through the next couple of quarters. And to TJ’s point, some of it will be used directly to buy our products, as we see in the grants space. But even if it’s not used directly to buy our products, we believe it will provide benefits to us, because it will free up budget dollars. And then the third thing I’d add is that, we are seeing significant infrastructure bill working its way through the federal government. Those are also incremental funds. So ultimately, when those start trickling down, they will trickle down in the form of grants. And while they’re more focused on hard infrastructure, there is still a grant benefit from any of these funds coming through the federal government.

[Unidentified Analyst:]

Got you, very helpful. That’s it for me.

[John Curran:]

Thanks, Aaron.

[TJ Parass:]

Thank you.

[Operator:]

Thank you. We have no further questions on the line. So I’ll hand back over to management for any final remarks.

[TJ Parass:]

Just want to say thank you for joining us today. We’re very pleased with the quarter, pleased with what the GTY staff is doing out in the public sector here, and want , and have a great night. And we’ll see you next quarter.

[Operator:]

We thank you all for joining today’s call. The call has now completed and you may now disconnect your line.