Comstock Inc.
Q4 2017 Earnings Call Transcript

Published: 20 Feb 2018

[Operator:]

[Technical Difficulty] …during the fourth quarter of last year alone. We also just entered into a formal agreement to sell the Daney Ranch for $4 million in cash, about twice what we paid for just a couple of years ago. That will take our $9.6 million in senior debt down by almost half by the end of the next quarter. The profit from that sales also sheltered from any federal taxes because of our existing tax assets, and we've also began getting significant interests on our other properties, our other non-mining properties, as local economy continues to explode with industrial development. We won't be able to labor [ph] it, but the Tahoe Reno Industrial part has now sold, the brokers have now sold all of their properties to companies like Google, Tesla, Walmart, Switch and most recently, Blockchains, LLC, and they're all starting to either expand their facilities or breaking ground for new development. The early completion of the existing USA Parkway's only accelerated all of these developments and more importantly, the activities in the periphery around all these developments. We very much expect to monetize these non-mining assets and pay off the existing debt obligations with cash to spare this year, and we think that the announced sale of the Ranch is a huge step in that direction. Let me just highlight the mining results for 2017. We reduced our annual operating expenses by over $6.3 million, with year-on-year reductions in every category. For example, real estate operating costs are down 60% year-on-year, bringing the hotel and real estate operations to a second-straight cash positive and profitable year. Although it's small, it's great that those assets are covering themselves. Environmental and Reclamation was down 40% year-on-year, despite a hell of a wet winter in January, February, March of 2017. G&A costs were reduced by 25% year-on-year, representing almost $1 million year-on-year reduction. Those costs would have come down even further if it wasn't for the wet winter, where we spent quite a few hundreds of thousands of dollars managing water during that period. Yet those costs were all still down dramatically year-on-year. And despite all of those reductions, we also were awarded the 2017 Nevada Excellence in Mine Reclamation Award for Lucerne-related mine reclamation. It's actually our second Nevada Excellence in Mine Reclamation Awards in just the past 3 years. It's a coveted rare type of recognition. To get it twice in 3 years is truly remarkable effort by our team. In 2017 - in late 2017, we also found our strategic joint venture option agreement for advancing the assessment and development of Lucerne Resource area. This is not only advancing the assessment of Lucerne Resource towards economic feasibility, but it's also started to sub-size some of our costs and has potential to reduce those costs even further, potentially by over $1 million a year. Our annual costs in 2018, before any benefits from that joint venture or the subsidiaries thereto, and despite the reductions that we've already banked in 2017, will still be over 25% lower year-on-year, representing about another $1 million reduction. We've guided in the outlook that our cash operating expense in 2018 is $3.6 million. We've also advanced the Dayton Resource development with an extensive array of metallurgical testing, really quite remarkable. Working with multiple external metallurgical labs here in Nevada, as well as our own in-house metallurgical labs and with our partners. Most of this testing either came through third-party funded metallurgical testing, including processing screening assing [ph] for higher gold and silver extraction results or through federally funded grants through Cycladex, our strategic investee. Most of the work with Cycladex has been done on the Dayton Resource area. Recent columns for Dayton are showing gold yields of almost 85%. In fact, we had gold yields of 82% to 85% in the most recent tests. Another test work that we've done has even shown higher yields. We believe that we can enhance the economic feasibility even dramatically and very possibly, with non-cyanide solutions. A lot of our test work has been with non-cyanide materials. Some of our test work, in parallel, has been with cyanide materials. With Dayton, we also state an additional 30 unpatented lode claims last year adjacent to the Dayton Resource area, including 472 contiguous acres, which, frankly, increases our southern landholdings by over 25% and overall, takes us to almost 9,300 acres, representing over 10 square miles. This work has really positioned us to provide a more detailed and a broader update for the Dayton Resource, including towards economic feasibility and in fact, without additional drilling, with the goal of publishing an updating technical research report and hopefully, a preliminary economic assessment to go with that by the fourth quarter this year. But we are going to update it. We are going to provide a stronger, more robust report, and we are intending for it to have at least preliminary economic feasibility. With the Lucerne area, we're very pleased to have been able to advance the assessment over the past 4 months. As all of you know, in early October, we entered into the Option Agreement with Tonogold. And Tono has really been diligently assessing the existing resource with the objective of assessing it, its potential, both near and longer term, and its feasibility. The work's very detailed. They're working hard, and it includes independent third-party geological and engineering consultants to provide that assessment with Lucerne and its potential. We're happy with the way the collaboration has been to-date. The process, the diligence that's being exhibited by all parties, and we just ask you to stay tuned over the next month or so for meaningful updates. Ultimately, this work will result in updated third-party assessments, technical reports and ultimately, same as Dayton, with the objective of reporting economic feasibility. We have technical committee in place with representatives from both companies. We have scheduled to be meeting here in February and beyond. And again, I just ask for a little patience to stay tuned on all that work. From a corporate perspective, I've already mentioned the cost and liability reduction, the reduction in debt and the positioned land sales. I also want to note that we have $2 million of cash on hand, and it's our intention to maintain excellent liquidity, stability, as we start to really pursue these strategic advancements. And we have a number of these things moving forward, and I will be reporting on them as they're completed, be it at the metallurgical developments, the joint venture developments or other strategic initiatives that we're working on to get us broken out and really start recognizing the value of this platform that we position. So ask you to be a little bit more patient, but there's going to be a meaningful amount of communications that will continue. I've also been able to finally here in 2018 get back into the investment community, attended an outstanding investment conference in Vancouver in January, have met with investors in New York, and we're really starting to see a renewed interest in the company. And I would say, at this point, in a much more meaningful way. We've also had interest just beyond Canada and the U.S. from the Asian community. We've been approached and reached and met with Chinese investors, both in the U.S. and Canada, for both mining and non-mining opportunities up for investment. So everything on our plate is moving forward, probably, for the first time in quite a while. All of the activities are progressing forward. Feels like all that traction is coming back, and we have a really strong plan to actively market to our investors and to new investors throughout 2018. We're positioned the company to build that production profile. We really want to be a 100,000 ounce producer or more and grow from there. The path is clear for us on how to do that here in Nevada. And we really believe, and we continue to restate that ultimately, that will result in valuations in the hundreds of millions of dollars. We're targeting $400 million to $500 million. We've been public with that. We continue to say it, and we continue to work very hard toward it. Let me close my prepared remarks by thanking one of our former directors, Bob Reseigh, for 9 years of service to our board. Bob remains with us on our newly formed Mining Advisory Committee that can also help boast the [indiscernible] capitalist and our newly appointed Director, Leo Drozdoff, to joint and mining, as far as we're concerned, especially here in Nevada. It's probably worthwhile to mention that Leo has participated in almost every aspect of Nevada - the Nevada mining industry, from engineering, mine engineering, legislation, environmental regulation, economic developments state-wide and even historical preservation. He ran, he was literally the top state official, running the Nevada Department of Conservation and Natural Resources for the past 6 years, reporting the Governor and Governor Sandoval's predecessor. He was cabinet to the governor. And prior to that, he ran NDEP, Nevada's Division of Environmental Protection for over 6 years. And even prior to that, he was Beuro Chief of Mining and Water Control to the most critical Nevada-mining Beuro responsibilities. So we're honored to have Leo on our team. His knowledge of the whole industry, but maybe even more so of all the people and the regulators across the spectrum is truly second to none. I thought I had a lot of great relationships from Nevada, but Leo takes it to another level. So he is especially valuable to us, as we look forward to develop and commercializing new technologies, and the permitting that sort of comes with that. So anyway, I will pause there, briefer than normal, and Naomi, maybe we can just turn to questions?

[Operator:]

Thank you. [Operator Instructions] We will take our first question from Jon Way from Wedbush Securities. Please go ahead.

[Jon Way:]

Morning, Corrado.

[Corrado De Gasperis:]

Morning, Jon. How are you?

[Jon Way:]

Hanging in there, good. Would you go through, again, the non-cyanide solution work with Cycladex and Itronics, just to clarify?

[Corrado De Gasperis:]

Happy to, John. Yes, I'm happy to, thank you. So we really see Cycladex broadening the footprint of their work. They're under a federally funded grant. We've done tremendous amount of column testings. We've done cyanide, non-cyanide side by side. Yields have been very impressive. And they are now working on, I guess, I would call, pilot-scale you know, simulations of the processing, working on a number of various alternatives. Interestingly, rather than all the column tests were essentially done on site, what they're doing now is, they're actually setting up and piloting at certain locations, certain customer sites. So it's kind of fascinating. They're looking at and expanding and defining the market, and then they're doing test work on literally, on-site, in some cases, funded by their customers to test out the solution on a more, I want to say, practical, non-lab scale. So not full commercial scale, pilot scale. And I know that they've had at least two of those scenarios in non-U.S. countries where cyanide is prohibited. So very exciting. The results of that test work should help them get to commercial feasibility. We're monitoring it with great interest. From the Itronics perspective, we've just run an extensive battery of metallurgical testing, primarily on existing ores. We've - we started off using the leach pad ores, because it was probably the most challenging, but majorly, the Dayton ores. And we've expanded that testing way beyond just bottom [ph] ores. We've done some additional processing crushing, and we're getting remarkable results. That work has been funded by Itronics, and they're extremely keen to see their solution play out here. I don't think of the 2 of them as our competitors in the sense that they have very, very different solutions, both very incredibly, actually, environmentally friendly. And I do expect that - first of all, I expect to update the Dayton feasibility, as I mentioned in my prepared remarks. And I am having an increasing expectation that the work that's being done behind the scenes, in both cases, could enhance those feasibilities. So I mean, ultimately, the non-cyanide solution, it's a breakthrough. But we're only interested in having that kind of solution if it enhances our economics as well. So right now it feels like we're on the path, and I do expect that we will have substance of updates during this year. It could be as soon as the next couple of quarters, but it will certainly be in the calendar year.

[Jon Way:]

Thank you.

[Operator:]

Thank you. We will take our next question from J. Gunn from Rockport Global Advisors. Please go ahead.

[Q –J. Gunn:]

Good morning, Corrado. Can you just comment how the year is looking going forward for your liquidity, and just where you're at on your debt obligations, please?

[Corrado De Gasperis:]

Yes, thanks, J It's a great question. So we have one main debenture. It's $9.6 million. It's a longer-term note. It goes out until 2021. But we have, as one of our top corporate objectives, you know, to pay off our debt. The announced sale of the Ranch for $4 million cash, and we had announced, previously, a deal to sell the Ranch, which was going to result in about $3.6 million of cash proceeds. We've enhanced the transaction. It's going to take, maybe, an extra month or 2 to close up. But now we're looking at getting $4 million in cash. So we're very excited about that. I mean, it takes a huge whack you know, off of the obligation, and then our other non-mining assets, we probably spent most of our time working on the Ranch transaction in terms of our non-mining focus up until now. But over the last month, maybe 3 or 4 weeks, we've been getting and engaging a lot of conversation in the other non-mining assets. So I fully expect the monetizations to occur this year. I fully expect the debt to be gone this year, and I fully expect to have some excess cash associated with that. So I really - I think we're positioning for a homerun here. We have been patient, because we knew that USA Parkway coming in by the end of last year was going to be an accelerator. It actually came early in September. And as I mentioned, the economic interest, the industrial development, the lack of housing, the growth of employment and people, it just can't be exaggerated. I mean, it has to be the number one location in the United States in terms of economic growth. So we're liquid. We have $2 million cash. We're monetizing these asset sales, and we're maintaining the lowest cost structure that we're even taking it down further. So I'm really looking forward to some updates in the near future on all of that. It's really teed up and scheduled to be wrapped up this year.

[J. Gunn:]

Got it. Thank you.

[Corrado De Gasperis:]

Thank you, J.

[Operator:]

Thank you. Our next question comes from Eliot Cohen from Oppenheimer. Please go ahead.

[Eliot Cohen:]

Hello, Corrado.

[Corrado De Gasperis:]

How are you? It’s good to hear your voice.

[Eliot Cohen:]

It's good to see your results. I want to thank you again for another quarter and year of operational excellence.

[Corrado De Gasperis:]

Appreciate that, appreciate that. We really spent a lot of time in 2017 doing things that - although we're critically important in prerequisite, we'd much rather be spending our time growing our resource, growing our asset base and growing our equity value. But I'd like to think that with those things behind us, that's where all of our focus will be in 2018.

[Eliot Cohen:]

Right. So I have a question or tow regarding that, here. So your joint venture with Tonogold. As I remember correctly, the - some of the verbiage [ph] that came out of that agreement was, well, we're re-exploring this, and it might not be as great as we originally thought. So to my mind, there - that lowering of expectations doesn't make a lot of sense here. So I really wonder why they would say something like that when you've already proved up a pretty good resource there.

[Corrado De Gasperis:]

Well, yes. So that's a good point. So let me comment that, you know, I think that I think, it's important to acknowledge, right, that in both Lucerne and Dayton's case, we have resources, right? Resources are not reserves. So our - I don't know if it's a lowering of expectation or just really trying to focus on what the economic reserves ultimately will be. It's not as common for a company to go into production the way that we did from 2012 to 2015, without proven and probable reserves, right? But we had an usual circumstance, right? We had a very limited permitting footprint. We had a community that properly was demanding that we prove ourselves step by step and show that we're not only confident to mine, but socially responsible. I feel like in that regard we really did a fantastic job. We learned some things about the resource estimate. And we've been focused and talking about a much higher-grade core door that sits on the east side of it. We, positively and factually, we aimed towards that, sort of, higher-grade resource with an underground drift and a crossover to kind of surround it with underground tunnels with, frankly, a less-than-successful effort to establish an underground component to mining. But we learned a lot in every case, right? So what's great about Lucerne? We have a lot of data. We have underground tunnels positioned, ultimately for more much more efficient development. But I do think that there needs to be reassessment of the resource from a almost solely economic perspective, right? You can't do an economic assessment until you have a resource assessment, right? But once you have a resource assessment, you can then really calibrate, really focus on what's mineable, and how you would mine it. And in all fairness, given the way Lucerne's positioned, where it is, how we've mined it so far, the state route, I mean, and you name it, there are some complexities there that justify that kind of reassessment. So I'm not - I mean, we're not ashamed or embarrassed or concerned about anything relating to the past. But what we really want to focus on, what does look like going forward, establish a good economic parameter, establish a good target of ounces that someone other than us says would be mineable. And I don't mean Tono, I mean, third-party validated technical reporting. And then move it forward in the most intelligent way from there. And do the same exact thing with Dayton. Like both of them have resources. Let's step up now and move them towards economic feasibility, so that you and rest of our investors know not just how many ounces there are, but what's the cash flow. And that's our focus, and it's more narrow, it's more precise, it's more meticulous, and I'm very pleased with the work that's being done. So more to come. I apologize. I'd love to have results today. But I think good news to come with the work that's being done.

[Eliot Cohen:]

So could you give us an guesstimate on when we may ultimately see a feasibility study on these properties?

[Corrado De Gasperis:]

So I think, ultimate feasibility, you know, two definitions, right? You have pre-feasibility, and you have full visibility. Full feasibility with Dayton would require additional engineering and work. But pre-feasibility, really, just requires a good understanding of the economic shell, a framework of what's mineable and the cost and revenue projections associated with that. So I think we should be in position. I'm not a technical guy, and the technical guy always cautions me that it could take a little more. But I think, given what we know about both resources, we should be moving towards pre-feasibility specifics this year. And I can't say before the fourth quarter, because somebody will probably hit me if I do. But that's what we will say.

[Eliot Cohen:]

Okay, one more question...

[Corrado De Gasperis:]

Updates as we go out here, right? You know, hold on, I'll get back to you in 9 months, right? You'll hear an update next month. You'll hear updates next quarter. And then - but we'll be moving towards that goal, which I think because with a lot - what I'm hearing from our investors is that's what we really want.

[Eliot Cohen:]

Okay. And are drills turning right now at Tono?

[Corrado De Gasperis:]

So drills not turning and for the right reasons, right? The reassessment of the resource gives you an incredibly precise view of what you have and where the gaps are. And then I - it will ultimately result in much more - much better planned and much better -- much more efficient use of drilling dollars to the same end. So I think they're doing it the right way.

[Eliot Cohen:]

Okay. And one more question. On your green mining solutions for, I guess, it's leaching the gold out of the rocks here. The recovery rates are, obviously, very good. But what do you think the ultimate, all-sustaining inclusive cost is going to be for an ounce of gold per ton of rock?

[Corrado De Gasperis:]

So two answers for the question, right? So the yields have been good, and I guess, there's a little bit of a caveat on that - in that, our yields, on our works, have always been good, right? So that's great news, right, that we can use alternatives that are as good as hopefully, better than what we've see before. And then what we're seeing - and there's two different paths going here, right? We have more intelligence on the Itronics metallurgy in terms of cost than we do with Cycladex so far. But we're looking at scenarios where the cost is lower. So I don't have a number for you. But if it's not lower, ultimately, no one's going to care, right? It's got to be - well, that's not fair. If it's feasible, and it's environmentally friendly, people will care, right? But if it's lower cost, a lot of people will care, right? So right now we're working very hard. And that's where the feasibility then comes in, right? If you've done the lab testing, if you have the yields and extractions that you want, if you're seeing that the specific consumption of these new materials is low, those are all the variables, right, for a breakthrough. But you have to get the final feasibility work done. So that'll take a number of months, and we're preparing to do that now.

[Eliot Cohen:]

Okay. Thank you very much for answering my questions.

[Corrado De Gasperis:]

Thank you, Eliot. Thank you. Bye-bye.

[Operator:]

Thank you. We'll take our next question from Harvey Molca. He is a Private Investor. Please go ahead.

[Harvey Molca:]

Hi, Corrado.

[Corrado De Gasperis:]

Morning, Harvey. How are you doing, Harvey?

[Harvey Molca:]

Good. Could you enlighten us a little bit, how many actual shares are - of comp stock are out there?

[Corrado De Gasperis:]

49.7 million.

[Harvey Molca:]

49.7 million. So of the 9.5 million that you sold for $0.78 a share back in end of December, is that in the - that's in the 49 million?

[Corrado De Gasperis:]

Yes. That's all in, everything from last year, everything through, I think, yesterday, 2 days ago, whatever the accountants cut off on the face of the 10-K.

[Harvey Molca:]

Okay. And we're selling 23% insider. But then when I look for insider, the only insider I come up with this you. And we know that you don't have a 23% share. Who...

[Corrado De Gasperis:]

Yes, no. I think the 23% number has to include the John Winfield and the Winfield Group as an affiliate. There's - I think there's probably 3%. I have to go back and check the numbers. But it's about 2% board, including me, and about 20% or 21% the Winfield Group.

[Harvey Molca:]

Okay. It appears as though institutional ownership has decreased significantly, because I don't see any separation of a major sale?

[Corrado De Gasperis:]

Yes, no. I don't think it is significant. You know, like, I do see that there is a little bit of trimming with one fund. And - but when I go through the top 6, and I did mention this on the call, but I've had really good thorough updates with the top 6, really, with the objective of making sure they understand exactly where we are, and what we've been doing, very consistent with this call. And they're stable. Everyone's very stable. Everyone's very aware. Everyone's, frankly, say, everyone, but quite a few of them are excited about the prospects that we're looking at here in 2018. So I actually think, obviously, we had tremendous turnover in 2017. I think it's a remarkable outcome in that you have top 5 or 6 that are solidly in place, including the Winfield Group, including Century, including Sundown, including U.S. Global. So you get these guys in place, right? Not happy with the share price, none of us are, very, very disappointed with the share price, but stable in place. And then you have, sort of, a more of a high net worth retail base that's, frankly, a lot lower because of buying activities in the range that we experienced. So there is two bad things, right? Low share price and catastrophic destruction of your capital base. We've only had the first one, not the second one. The base is actually very stable and strong, which is not intuitive, right? It's not what you would think, given where share price is. But I've validated it. I've met. I've coordinated. And so I think we're positioned now to move forward. 2017 was a tough year for us. It was a tough year for the industry. And then when you get into the equity market disparities, you have tough tableau selling. It's all behind us, right? That's all behind us. We've got a base now, and we see a much more productive trading, much more positive trading, and we are going - we're just going to get the final traction, and I think it's just getting some of these things we're working on to the finish line, including the debt reduction as a sale of the Ranch, including some of these feasibility prospects moving forward. It will re-establish strongly and the credibility of the assets, the resource and where we are taking it. So it didn't feel good, despite a pretty tough 15 months.

[Harvey Molca:]

It appears to me that Randy Burke Century [ph] has reduced its position close to 25%. Is that correct?

[Corrado De Gasperis:]

So it's not that high. I met with Arnold [ph] and Jim on multiple, multiple locations. We've had some very frank, focused, diligent discussions. I think they're being fantastic fiduciaries for their investors in that involvement in their – in fact, both visited the site for multiple days of review. They have distributed accounts, and in some cases, an investor will say, hey look I just want to move out of sector or I want to move out of this company, which they honored, but - and as far as their position they're not in a cell, right? So they're stable and they're keen on us delivering on what we say we can deliver. I can speak to them. Obviously, you have to speak to them. But they are focused, they are tough, they're great fiduciaries. And for them to both take the time to come out and, not just check on the mining operations, but check on the local real estate market, see the giga [ph] factory with their own two eyes, drive down and see the industrial park. It's a lot of time. And they did it.

[Harvey Molca:]

Since Tonogold came on board, their stock has more than doubled, and ours is gone in half, so I'm trying to get an understanding of what's going on?

[Corrado De Gasperis:]

Yes. It's a - I think fundamentally, we have to re-establish the credibility of those resources. We have to move them towards feasibility, and then when that happens, evaluations will be there for us. I don't have any doubt.

[Harvey Molca:]

Okay. Are there any bites on the silver springs industrial?

[Corrado De Gasperis:]

So there's - there is visited interest, right? I would say bite is an offer, so let's call them nibbles. But we went from having a lot of fanfare and no visits through November, December of last year to visits from industrial developers, visits from commercial developers, discussions with local developers. And some interested people to invest or buy. So I think we're going to see some in the next 6 months, without a doubt, just because people are now getting engaged, the scarcity of water in that area is something that we predicted. It's probably more dramatic than we thought, and it's only lifted the values of our existing water rights. So we feel like we're in the best possible position. If we had any sales on the water right? We sold 50-plus acres feet last quarter. It was sort of on 2 traunches. The last sale being 15,000 in acre foot, and we've got them currently listed at 19,000 in acre foot. And projects are getting approved, right? So people are going in and submitting residential developments for approval, industrial developments for approval. And they need the water to do it. So everything's working in our direction. We also have had two major properties that surround us. One's a 160-acre commercial development in silver springs, get for water allocation and commercial sub-development is zoning approved by the county in state, and then a monster one, which is just south of the 80,000-acre industrial park. It's adjacent to an extension thereof. And I think they got 12,000 of those acres, which were zoned for residential, we zoned for industrial. And so, I should've probably mentioned that even though the Tahoe Reno Industrial park has now, you know, everyone has take their claims and there's no more property if you could get there, if you wanted to. We understand the last purchase was 9 figures. But now a group out of Las Vegas, which owns 20,000 acres, south to an adjacent, which is in visual proximity of our property, has just rezoned the 12,000 acres that's in Silver Springs to industrial. And they have a 2-year development plan. And they probably, if I read the conceptual design properly, when they got the approval, I was actually at the permit hearing. They've got space for 4 or 5 additional anchor companies. So it's a remarkable, and that's all coming - it's just moving right towards us. It's going to bump into us, if it's not careful. So we're very happy about that.

[Harvey Molca:]

Is there going to be another airstrip on the Tahoe Reno Industrial Center or Silver Spring is going to be the closest?

[Corrado De Gasperis:]

No, Silver Springs is the one. And there is an option by two California developers to purchase the Silver Springs airport. We know them very well. They’ve been working very hard on all of the economic developments happening around that. The master plan was approved and Tesla's landed there, at least ones that I'm aware of, and a lot of interest coming around that. Our property is adjacent to and has two points of possible through the center access. And so, we've gotten people come to us with conceptual designs about airport hangers, airport maintenance facilities. It just - it needs to be the people with the money that want to develop it. So I think it's just a matter of time.

[Harvey Molca:]

My last question is, we were at - when did the 5 to 1, we were at $0.20 or $1 a share, and now we're down to right around $0.34 a share. What's your prognosis to get back to the $1 share level on higher?

[Corrado De Gasperis:]

I think that - I think the deleveraging gets us to $1 in all by itself. Just from our hearing from people and their interest in seeing that that go away. I think that ultimately, we think these feasibilities are going to start in the hundreds of millions. And they're going to move up from there. So anything we can do to enhance it with metallurgy, with better cost, that's wonderful. But the numbers are going to be big, right? And so the $200 million you're at, you're at $4. And then we will go beyond that.

[Harvey Molca:]

We should be deleverage by the end of this year?

[Corrado De Gasperis:]

Yes. Yes.

[Harvey Molca:]

Okay. Thank you, Corrado.

[Corrado De Gasperis:]

Thank you, Harvey. I appreciate the questions.

[Harvey Molca:]

You bet.

[Operator:]

Thank you, ladies and gentlemen. The time allotted for question and answers has come to a close. I would now like to turn the call back over to Mr. De Caspers for closing remarks.

[Corrado De Gasperis:]

Thank you, Naomi. I just want to thank everyone for the good questions. We're very focused. We're working very hard on all the value creating initiatives. We'll be reporting updates as they come through. We expect to have them in the near future, intermediate future, and also 2018. If anyone didn't get a chance to ask questions, please feel free to follow up directly with me or Zack. We look forward to talking to you in the great near future. Thank you.

[Operator:]

This concludes today's call. Thank you for your participation. You may now disconnect.