Huron Consulting Group Inc.
Q3 2015 Earnings Call Transcript

Published: 23 Oct 2015

[Operator:]

Good afternoon ladies and gentlemen, and welcome to Huron Consulting Group’s Webcast to discuss Financial Results for the Third Quarter 2015. At this time, all conference call lines are in a listen-only mode. Later, we will conduct our question-and-answer session for conference call participants, and instructions will follow at that time. As a reminder, this conference call is being recorded. Before we begin, I would like to point all of you to the disclosure at the end of the company’s news release for information about any forward-looking statements that may be made or discussed on this call. The news release is posted on Huron’s website. Please review that information along with the filings with the SEC for a disclosure of factors that may impact subjects discussed on this afternoon’s webcast. The company will be discussing one or more non-GAAP financial measures. Please look at the earnings release on Huron’s website for all the disclosures required by the SEC, including reconciliations to the most comparable GAAP numbers. And now, I would like to turn the call over to Jim Roth, Chief Executive Officer and President of Huron Consulting Group. Mr. Roth, please go ahead.

[Jim Roth:]

Good afternoon and welcome to Huron Consulting Group’s third quarter 2015 earnings call. With me today is Mark Hussey, our Chief Operating Officer and Chief Financial Officer. Since we issued our initial 2015 revenue guidance in February, we have reduced and narrowed that guidance twice. Let me provide some color on our latest guidance and how we believe this will impact the remainder of the year. Our revised guidance is primarily attributable to performance in two segments

[Mark Hussey:]

Thank you, Jim, and good afternoon everyone. Before I begin, please note that I will be discussing non-GAAP financial measures such as EBITDA, adjusted EBITDA, adjusted net income, and adjusted EPS. Our press release, website, and 10-Q each have reconciliations of these non-GAAP measures to the most comparable GAAP measures, along with a discussion of why management uses these non-GAAP measures. Also, our acquisition of Rittman Mead India, which closed in July, is included in our third quarter financial results within our Business Advisory segment. Our acquisition of Cloud62 closed effective October 1, so our Q3 financial results do not include this acquisition. Their results will also be included within our Business Advisory segment beginning in the fourth quarter. Now, let me walk you through some of the key financial results for the quarter. Revenues for the third quarter of 2015 were $209.9 million, up 6% from $198 million in the same quarter of 2014. Revenues for the third quarter of 2015 reflect our acquisitions of Threshold Consulting, Sky Analytics, Studer Group, and Rittman Mead India, which in the aggregate generated $23.1 million of incremental revenues, representing 11% of total revenue in Q3. The year-over-year increase in revenues primarily attributable to our acquisition of Studer Group and strong quarterly performance from our Education and Life Sciences and Business Advisory segments. Operating income increased $15.5 million or 73.1% to $36.8 million in Q3 of 2015 from $21.3 million in Q3 2014. Operating income margin was 17.5% in Q3 2015 compared to 10.7% in Q3 2014. Adjusted EBITDA was $50.9 million in Q3 2015, or 24.3% of revenues, compared to $28.9 million in Q3 2014, or 14.6% of revenues. Net income was $19.4 million, or $0.86 per diluted share, in the third quarter of 2015 compared to $12.2 million, or $0.53 per diluted share, in the same quarter last year. Adjusted non-GAAP net income was $25.7 million, or $1.14 per diluted share, in the third quarter of 2015 compared to $14.2 million, or $0.62 per diluted share, in the same period of 2014. Our effective income tax rate in the third quarter of 2015 was 37.1% compared to 36.8% a year ago. Now, I’ll make a few comments about the performance of each of our operating segments. The Healthcare segment generated 54% of total company revenues during the third quarter of 2015. This segment posted revenues of $112.1 million for the third quarter of 2015, up $14.3 million or 14.6% from the $97.8 million reported in the third quarter of 2014. Revenues for the third quarter of 2015 included $22.3 million of incremental revenues from our acquisition of Studer Group, which closed in mid-February of this year. Excluding Studer Group, revenue decreased 8.2% compared to the year-ago quarter. The decline in revenue compared to the prior-year quarter was driven by lower revenue from our performance improvement solutions as well as lower performance-based fees. With respect to our outlook for the year, the primary factors driving the reduction and guidance assumptions for the Healthcare segment are primarily lower revenue from the large complex engagement noted by Jim along with recent softness in our outlook for performance improvement solutions. Utilization was 81.1% in the third quarter, improving more than 500 basis points sequentially. We now expect the full year utilization for this business to average in the mid to upper 70% range. Performance based fees in Q3 2015 were $9.9 million compared to $19 million in the same quarter last year. Our full-year expectation for the range of performance based fees is now $50 million to $60 million. As we’ve indicated throughout the year, the mix of our engagements in 2015 has been more weighted to fixed-fee arrangements than we’ve seen in prior years. We now expect this trend to continue throughout the full year, and we believe the shift simply reflects the risk preferences of our clients. Operating income margin for Huron Healthcare was 42.5% for Q3 2015 compared to 28.3% for the same quarter in 2014. The increase in margin was primarily due to a decrease in bonus expense. The Education and Life Sciences segment generated 20% of total company revenues during the third quarter of 2015. The segment posted revenues of $42.1 million in Q3 2015, an increase of 15.1% compared to revenues for Q3 2014 of $36.5 million. As Jim noted, the increase in revenue during the quarter was driven by strong demand across all service lines within the Education and Life Sciences practices. The operating income margin for Huron Education and Life Sciences was 24.9% for Q3 2015 compared to 25.9% for the same quarter in 2014. Operating margin remained relatively flat quarter-over-quarter, which is primarily attributable to an increase in utilization and bill rate due to a favorable mix, partially offset by an increase in bonus expense. We also continue to invest in our workday capabilities and are pleased to announce we deployed resources at multiple workday engagements during the quarter. Our Legal segment generated 16% of total company revenues in the third quarter. The segment posted revenues of $34.4 million in Q3 2015 compared to $46.1 million in Q3 of 2014. The year-over-year decline in revenue was primarily attributable to the reduction in credit crisis related work that occurred during the late 2014 and early Q1 2015. As Jim mentioned, out of all of our businesses, Huron Legal has the least visibility due to the transactional nature of their work. However, we are encouraged by the backlog of work in this business, which includes continuing demand for M&A related set of requests, investigations and litigation work among some of the most complex clients. The operating income margin for Huron Legal was 27.8% in the third quarter of 2015, compared to 23.7% in the same quarter of 2014. The increase in margin was primarily due to lower bonus expense in Q3 2015 compared to the prior-year quarter. Business Advisory segment generated 10% of total company revenues in the third quarter. The segment posted revenues of $21.2 million for the third quarter of 2015, an increase of 24% compared to $17.1 million in Q3 2014. The Rittman Mead India acquisition did not materially impact revenue growth in the quarter. The operating income margin for Huron Business Advisory was 24.6% for Q3 2015 compared to 25.7% for the same quarter in 2014. Two factors drove the slight decline in the margin. First, the level of performance based fees in the third quarter of 2015 was lower than the same period in the prior year. Performance-based fees in Q3 2015 were $0.5 million compared to $2.7 million in Q3 2014, all strictly related to the timing of engagements. Second, Our EPM&A practice grew at a faster pace than our legacy business advisory practice in the quarter. And as a result, the blended operating margin slightly declined as expected. Other corporate expenses not allocated at the segment level were $26.9 million in Q3 2015, compared with $24.3 million in Q3 of 2014. Approximately, $2.7 million of Studer Group’s costs are included in unallocated G&A as these activities are consistent with other corporate activities. Excluding the impact of Studer Group, other corporate expenses were flat year-over-year. Now, turning to the balance sheet and cash flows. DSO came in at 74 days for the third quarter of 2015, an increase of three days compared to the second quarter DSO of 71 days. Total debt includes both the $250 million face value of convertible notes, and $201.3 million in senior bank debt for a total debt of $451.3 million. We finished the quarter with cash of $13.5 million for a net debt of $437.8 million, a reduction of $46.7 million compared to net debt of $484.5 million as of the June quarter. We ended Q3 2015 with a leverage ratio adjusted for Studer Group’s LTM EBITDA of approximately 2.6 times. Our cash flows continue to remain quite strong. Cash provided by operating activities for the quarter was $64.9 million. Capital expenditures are expected to be approximately $20 million for full year 2015, and we continue to expect free cash flow for the year of approximately $125 million. Finally, as Jim mentioned, we’re updating our annual guidance ranges, which include our acquisition of Cloud62. We now expect revenue of $835 million to $850 million, adjusted EBITDA of $170 million to $175 million, and adjusted EPS of $3.60 to $3.70 per share. And finally, our full-year income tax rate is expected to be approximately 40%. With that, I would now like to open up the call to questions. Operator?

[Operator:]

Thank you. [Operator Instructions] Our first question comes from Tim McHugh with William Blair. Please proceed sir.

[Tim McHugh:]

Thanks. I guess first on the large engagement that you talked about, I guess it was a little unclear. Is it a timing issue? And just how quickly, I guess, the client is willing to proceed? Or is it that they’re not going to do some of the initiatives they had planned and/or they’re doing it themselves rather than using your services to do it?

[Jim Roth:]

Tim, this is Jim. Clearly, part of it is timing, but there’s another part that they are continuing to sort it through what is the right scope for them. And so those are the two primary aspects of that. We don’t get an indication that they’re necessarily doing things on their own. It’s largely driven for us in terms of the impact on the estimates. It’s largely driven by timing and a different scope than we had originally anticipated.

[Tim McHugh:]

Okay. And then I guess to ask about the contingencies here. Also that was a number that was a lot less than we thought and you brought down your number a lot for this year. Recognizing there is a shift in, I guess, the mix of – I guess engagements, there’s also like I would assume a dynamic of where you’re at in some of these large engagements. I know you normally don’t like to look out at a year, but where are we – can you give us some help in terms of what would be a normalized level for next year? I’m trying to balance performance improvement being weak with where you’re at in the lifecycle of some engagements?

[Jim Roth:]

Tim, this is Jim. I don’t know that we know enough at this point in time to really give an accurate sense as to where it’s going. And we have A - as we’ve always seen, we have some of our performance-based work sometime accelerates, sometimes it gets pushed back, and we get visibility into that as the year progresses. So for us to look into 2016 at this point is too much. We’ve had some instances this year where we’ve actually had a conversion of things that had been contingent into fixed. And so given all of these kinds of dynamics, particularly at this time of the year, we’re a little bit reluctant to kind of take our stab at what next year might look like in terms of contingent revenue?

[Mark Hussey:]

Tim, I’m just going to add. This is Mark. I’m just going to add to that to say, when we think about contingent fees in terms of the planning process, it really is one element that we don’t always control. And so, we take out best estimate at the beginning of the year as to how we expect the engagements to unfold in terms of that mix of fixed versus contingent. And as we look at the full year adjustment on guidance, the reduction in performance-based fees was really not the core of the story at all.

[Tim McHugh:]

Okay. Mathematically, it’s a big number relative to the change, but...

[Mark Hussey:]

There was – I will add one thing. In the quarter, there was some shift from Q3 into Q4 that’s reflected in our updated guidance, but that, again, I think is not the primary driver of why we had a reduction in guidance.

[Tim McHugh:]

Okay. And I guess – may be just talk about more broadly the idea that the M&A activity in the hospital sector, which you’ve talked about driving demand. Do you think, you’ve – just the engagements you’ve had just proven to be more complicated? Or I guess you referred to the fact that there are some opportunities out there you’re waiting to hear on, I guess just probably the aggregate demand picture. Is this a function of individual engagements that we’re seeing your numbers or has your view of the aggregate opportunity with regard to that changed?

[Jim Roth:]

Tim, I don’t think – this is Jim. I don’t think our view of the aggregate activity has changed at all. We continue to look at this as being an industry that’s going to be going through a very significant change. And irrespective of whether we have a great quarter or a lesser quarter, I don’t think anything has changed in terms of where we see the industry going. And as we indicated in my comments, in my part of the script, we don’t see change in terms of our competitive position either. I think we’ve gone through a pretty robust period of time over the last two or three years, and you’ve seen our healthcare practice rise along with that robust activity. And as we indicated that the Affordable Care Act has kind of introduced some new metrics into our hospital clients in terms of their financial performance, which I think has provided, in some cases, a little bit of less urgency, in some cases around the need to do cost reduction. That’s not to say that we’re not – we still continue to see clients that come to us for help in cost-reduction efforts. We’re certainly aware of a number of clients that are – on the horizon have some significant cost reduction efforts in mind. How and when they come about, whether we get that work is – where we can’t speculate on. But there really is nothing at the macro level in the industry that we look at that gives us any reason to believe that things are going to be different. Having said that, as we indicated, our clients’ business, all of our clients’ businesses are going through revolution, and I’ve seen every single professional services firm has to go through changes in order to meet shifts in market demand. We started out and we built a very solid clinical solutions practice that we didn’t really have probably four years ago. We’ve introduced a lot more effort around strategy and physician integration. And so, we’re constantly evolving our service lines to meet the demands in the business. We think that there is going to be a very strong need for continued performance improvement work as we think there is going to be continued demand around M&A that’s led to a lot of our other efforts as well. So it’s a long way of saying. I don’t think we see any structural changes in the market that tells us that we should be overly concerned about the future. I think we’re just simply going to have to work with some of the vagaries around some of the specific demands we have for our solutions or one of our solutions in particular as we kind of begin to wait this out.

[Tim McHugh:]

Okay. Thanks.

[Operator:]

Our next question comes from Paul Ginocchio with Deutsche Bank. Please go ahead.

[Paul Ginocchio:]

Thanks. Jim, I don’t know if you want to try to size or help us size to sort of break out the various components here. One, where the scope changed on the big project, maybe how much less revenue that’s going to be and for the one that’s pushed out – but the same scope on those big hospital contracts, is that mean is this going to be more in 2016? And then when you talk about just lower demand for performance improvement, I mean if it was – if normal demand was growing for performance improvement high single-digits, have we – is it just a step down then we’re going to re-grow at high single-digits, or is it a step down and stabilizes? Is there – anyway is there a way to understand the step down or the new growth rate? Thanks.

[Jim Roth:]

Okay. So let me see if I can respond to all of that. I think I may start from the last question and move back to the first. I think in terms of the lower demand, I don’t – we’ve been pretty clear that I think we think that the longer-term trends in the industry are going to continue to be very solid for performance improvement services. What we don’t want to do is to – we’ve been very surprised just at the downturn, particularly given the fact that we’ve had such a pretty significant growth rate over the last three years, so that caught us by surprise. So rather than go back and say, well, it’s just temporary and it’s only going to – we think it is temporary, but rather than estimate the timing as to whether it’s one quarter or two quarters or more, I don’t think we have enough information right now, particularly given that kind of the pace at which this has evolved. So we know what’s in front of us right now, and it wasn’t really that evident earlier in the year. It’s much more evident right now. Our sense is that it’s not going to be very long, but I don’t want to begin to conjuncture in terms of how long that’s going to be. In terms of the other larger projects that you’ve referenced, the – certainly, we had indicated that the one project started later than we have thought this year, but that it was progressing as we have planned. And as a result, I think that probably would mean that some of the revenue that we had originally anticipated would be in 2015 will now be pushed to 2016 and possibly even 2017. So, that’s, I think, consistent with what I’ve been saying all along. The first one, the other large project that we’ve been talking about, I prefer not to kind of get into the specifics about the scope part of it because I think it still is evolving for us. And it evolves at the client for all the right reasons. As we’ve said before, they may start with some specific initiatives, but as we’ve seen in some of these large projects, it takes a while and it takes a lot of effort to get organizationally in sync that there’s one kind of system-wide objective that they’re trying to get at. And when that’s not optimal from the client’s perspective, there’s no way that we’re going to be successful in helping them achieve their goals. So even though things are pushed out and even though there’s going to be sensitivity or uncertainty around the scope, I think that’s something that we’re perfectly prepared to deal with the terms of being patient in letting our client get to the position where they are the most comfortable, that we and they are prepared for success. So, I wish we have more specificity, we could offer there, but it’s just hard for us to do right now.

[Paul Ginocchio:]

Maybe Jim I could ask you in a different way. If you could rank from the biggest to the smallest legal performance improvement, the rescope or just the delayed project, which is the biggest impact to guidance, and which is the least?

[Mark Hussey:]

Yeah. So, Paul, this is Mark. If you look at the guidance reduction, I would attribute probably 60% to Healthcare, and about 40% to Legal. And again, we kind of did not want to get into the breakout within the 60% related to Healthcare.

[Paul Ginocchio:]

Understood, thank you.

[Operator:]

Our next question comes from Tobey Sommer with SunTrust. Please go ahead.

[Tobey Sommer:]

Thanks. Some of my questions has been asked and answered. But I wanted to ask something about utilization in the Healthcare segment in the quarter which is pretty good, but the bill rates kind of lower, at least, than I had expected. Is that a function of more people on sort of the assessment phase of projects or is there another explanation?

[Jim Roth:]

Well, let me take at this way, Tobey. You’ve got the reduction in the bill rate really if you take out contingent fees is really almost essentially even year-on-year. So...

[Tobey Sommer:]

Understood.

[Jim Roth:]

So – but when you look at the utilization, again, we have had people much better deployed. But again, I think what we’re saying on – as an example, on the performance improvement area, we’ve got some softness and that is one of the factors that’s likely to show up a little bit in utilization. We try to manage that as we always talk about because normally when we talk about utilization, we talk about hiring. We talk about all the elements that go into that. And clearly, utilization is one of the most important margin measures that we try to manage. And so, we are trying to manage that through just the overall normal attrition, the hiring process, et cetera, just to keep the utilization numbers in a range that is going to deliver the margins that we’d like to deliver. It’s also associated with the mix as well, but I think that probably gives you the flavor.

[Tobey Sommer:]

Perfect. If you look at the hospital customers and break them apart into different buckets, either not-profit, public, for-profit, academic medical research centers, is there a discernible difference in the behavior of those different slices of the hospital market?

[Jim Roth:]

Tobey, this is Jim. We still – prior to our acquisition of the Studer Group, I think nearly 99% or more of our work was with not-for-profits and the AMCs are all not-for-profit as well. So when the Studer Group acquisition came along, they have some for-profit clients but it still is a relatively small piece of our overall business. So I don’t know that there is any discernible difference really in terms of the margins or anything else in terms of the way we’re looking at the businesses. Most of the non – as I said, most of the non-Studer Group work within the healthcare practices all done for not-for-profits.

[Tobey Sommer:]

Last question for me and I’ll get back in the queue. It relates to the share repurchase that’s been on the books now for a while and you renewed it. Could you give us any color on where you expect to deploy capital near-term, kind of, where the leverage is that you’re comfortable? You might think about perhaps getting more [indiscernible] on that. Thanks.

[Jim Roth:]

Well, clearly, I would say the renewal of the program just suggests our commitment to continue to be active in the market from time to time. And I’d say that the cash flow and the flexibility around the balance sheet with leverage now down to, let’s call it, roughly 2.5 and continued strong cash flow expected. We’ll continue to look for probably, number one, acquisitions that really continue to fit within our businesses because we think that’s the best value creating strategy over time. But we’ll continue to be active in just managing the balance sheet and the capacity that we have to include share repurchase as part of that mix.

[Tobey Sommer:]

Thank you.

[Operator:]

Our next question comes from Randy Reece with Avondale Partners. Please go ahead.

[Randy Reece:]

Good afternoon. I wanted to discuss a little bit how the timetable of, let’s say, sales pipeline to revenue materializes in your performance improvement consulting. And it looks like a fairly short-term relationship if you look at the sequential revenue decline, which was kind of surprising, but it also seems like you would have seen something developing over the previous quarters.

[Mark Hussey:]

Yeah. So, Randy, this is Mark. I would say that as we’ve seen the mix of the kinds of things coming into the pipeline, that’s – as we’ve seen that trend starting to happen, I think that’s really is where you start to see a little bit of the shift away and some of the softness happening. And so, the key is at any point in time, we have a lot of different assessments going on, and it’s hard to look at a data point at any single time to really understand the full context. Our quarterly re-forecasting process certainly helps that come together in a more comprehensive way. But then I think with perfect hindsight, you can go back and probably point to data points that may have happened, but it’s contemporaneously a little bit difficult to figure out if that’s indeed a trend. So I would say, in retrospect, we probably had seen some signs, but not really that many. And I think this last assessment is really where we said, the market really has softened in this particular area and is going to have some impact in pipeline going forward. And then, we need to make some adjustments in terms of how we’re approaching the market.

[Randy Reece:]

And am I interpreting it correctly that your guidance adjustment for legal implies that the fourth quarter revenue level will be similar to the second quarter level?

[Mark Hussey:]

Correct. It’s probably somewhere in that range. I think as Jim described in probably for a full year down, probably the low 20% range. Clearly, in Q4, there is a much easier comparison because of the prior year being so low, so likely to be a strong double-digit performance versus prior year.

[Randy Reece:]

All right. Do you have any expectations for how long that sequential surge of business could carry into next year? Do you have any concern about that rolling off at some point?

[Jim Roth:]

Randy, this is Jim. I think we’ve – this is the part of our business. As we said, we just have the least visibility and we’ve had large projects come out of nowhere and pick up very quickly. And we’ve had [indiscernible] projects that end much more quickly than we thought. So, I think if we ever have any practice that we tend to look at quarter-by-quarter, it’s this one. And we just – it’s too hard for us to look out that far the year right now, given the transactional nature of the business.

[Randy Reece:]

Thank you very much.

[Jim Roth:]

Thank you.

[Operator:]

[Operator Instructions] Our next question comes from the line of Kevin Steinke with Barrington Research. Your line is now open.

[Kevin Steinke:]

Good afternoon. I just want to circle back on the third large project with the reduced scope. I don’t know if you can characterize or willing to characterize just the types of activities that are being scaled back at least for now. If you could characterize them in terms of the types of services that are being scaled back either performance improvement, revenue cycle, clinical solutions or any other way that that you might characterize the services?

[Jim Roth:]

Kevin, this is Jim. I think we’d prefer not to do it. I’ll tell you that that, again, when we talk about – there’s a tendency to talk about one large project as you’ve indicated and you’re aware there’s a number of workstreams within anyone of these large projects and the larger the project, the more workstreams there are. Some of the workstreams are across multiple hospitals; others are unique to one specific hospital. So really the only way I could really answer your question directly would be to kind of go back and look at each of the individual workstreams and of which their stores are many. And so, I think it’s just – it’s the kind of information we’re not going to provide. But I think these things we talked about them as being large projects, on the surface, they’re much more complex than even that and they require just a whole bunch of give and take in terms of whether it is across the whole system or unique to one specific hospital.

[Kevin Steinke:]

Sure, okay, understood. And you mentioned that you’re starting to see the ramp up of some projects with your workday efforts. I mean is that happening in line with your expectations or a little faster or how would you characterize, how that effort is going?

[Jim Roth:]

I think that effort is probably going – we’re ramping up quicker than we had originally anticipated and is probably at this stage going better than we had anticipated.

[Kevin Steinke:]

Okay, good. I don’t know if you care to revisit, you updated your outlook for the Education and Life Sciences practice. On the last call, mentioned high-single, the low-double digit growth for full-year 2015.

[Jim Roth:]

Yes.

[Kevin Steinke:]

Is it kind of the range we just – still think about or any update there?

[Jim Roth:]

Kevin, let me add a couple of comments, one, about Education and Life Sciences, and the other really about Business Advisory because I think that will help paint the full picture for everyone. In the Education and Life Science practices, I think we’ll end up finishing the year in the low-teens on a full-year basis. And I think in the Business Advisory practice, we’re likely to finish in the high 20% range. So, good momentum on a full year basis. We’ve seen that continuing on. As you get to the end of this year that you’ve got a little bit tougher comparisons, and that’s one of the reasons the growth rate is just a little bit less coming into the end of the year.

[Kevin Steinke:]

Okay, perfect. Just one last question, just circling back to an announcement that you made earlier in the quarter about hiring a Chief Marketing Officer. Is that a new position for you?

[Jim Roth:]

No. Let me take that one, Kevin, as well. We took the position of, which I’d previously been a Vice President of Marketing, and we really looked at it more comprehensively across the organization. And so, I would say, our objective is to really take our marketing efforts to a different level. And so, it was an existing position that we’ve really expanded into somebody who’s much more seasoned and impactful within the organization. So, we have high hopes as the market has become more sophisticated whether it’s around digital marketing or really even just the selling efforts. It’s part of the overall go-to-market strategy to get better executive leadership in the area of marketing.

[Kevin Steinke:]

Okay, thanks for taking my questions.

[Operator:]

Mr. Roth, we have concluded the allotted time for this call. I’d like to turn the conference back over to you.

[Jim Roth:]

Thank you for spending time with us this afternoon. We look forward to speaking with you again in February when we announce our fourth quarter and year-end results. Good evening.

[Operator:]

That concludes today’s conference call. Thank you, everyone, for your participation.