Park City Group, Inc.
Q2 2020 Earnings Call Transcript

Published: 11 Feb 2020

[Operator:]

Greetings and welcome to Park City Group Fiscal Second Quarter 2020 Earnings Call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. [Operator Instructions] As a reminder this conference is being recorded.It is now my pleasure to introduce your host Rob Fink with FNK IR LLC. Thank you Mr. Fink. You may begin.

[Rob Fink:]

Thank you, operator, and good afternoon everyone. Thank you for joining us today for Park City Group's fiscal second quarter 2020 earnings call. Hosting the call today are Randy Fields, Park City Group's CEO and Chairman; and John Merrill, Park City Group's CFO.Before we begin, I would like to remind everyone that this call could contain forward-looking statements about Park City Group within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are statements that are not subject to historical facts. Such forward-looking statements are based upon current, beliefs and expectations.Park City Group management are subject to risks and uncertainties which could cause actual results to differ from those forward-looking statements. Such risks are fully discussed in the company's filings with the Securities and Exchange Commission. The information set forth herein should be considered in light of such risks.Park City Group does not assume any obligation to update information contained in this conference call. Shortly after the market closed today the company issued a press release overviewing the financial results that we will discuss on today's call. Investors can visit the Investor Relations section of the company's website at parkcitygroup.com to access this press release.With all that said, I'd now like to turn the call over to John Merrill. John, the call is yours.

[John Merrill:]

Thanks Rob, and good afternoon, everyone. As we have communicated on previous calls, we began shifting our focus back in April 2019. Our focus remains as follows, one, grow recurring revenue and reduce the historical reliance on $4 million to $6 million per year in one-time revenue. It is nearly impossible mathematically to overcome one-time revenue reductions all at one-time. But longer term there's significant value to be captured.Two, keep the annual operating expenses flat. As I have said it takes $17 million a year to run this place absent marketplace costs. Three, increase profitability and cash. And four, grow the network, grow the network, grow the network. As we have mentioned, the three initiatives Randy and I believe we can accomplish these goals or the growth in Tier 2 hubs, cross-selling and upselling and our supply chain offering and expanding marketplace. Let me spend a minute our progress.Let's start with the growth in Tier 2 hub. Since June 30, 2019, the company has added 42 new Tier 2 hubs bringing the total to 90 as of December 31, 2019, an increase of 88%. For perspective, just a year ago, the company had less than 25 Tier 2 hubs cumulatively. The increase in Tier 2 hubs was the result of one dedicated seller in order to accelerate our progress going forward and based on the success to date, we've added three additional dedicated Tier 2 sellers in January and February, increasing the total dedicated Tier 2 sales force from one to four.Growing the network, since June 2019, and the company has grown from 23,000 unique supplier participants to over 27,000 at the end December 2019, an increase a 16%. The increase in the supplier network grew largely through Tier 2 addition. Keep in mind, that every Tier 2 hub brings with it approximately 80 new suppliers for the network. As Randy will point out [Technical Difficulty] offering FMIs endorsement of the application is anticipated to accelerate our cross-selling opportunity, and he will address that in a moment.Lastly its marketplace, while, marketplace has grown 13% year-over-year it remains largely transactional, difficult to predict, but very important key store strategy, separating our customers source that in transact business.Turning to the numbers, we generated $2.7 million in cash from operations for the first six months of fiscal 2020. This is 46% more than $1.8 million we generated in the first six months of the prior year. Total cash as of December 31, 2019 reached $19 million. All our repurchasing 1.8 million in common stock to-date under our stock buyback program.Deferred revenue for the comparable period also increased by 28% or $544,000, which reflects our growing subscription base and our ability to systematically backfill the one-time revenue. In the second quarter of fiscal year 2020, total revenue was $4.84 million down 13% from $5.56 million in the same quarter in 2019. It should be noted that last year's fiscal second quarter included $1.1 million a non-recurring one time revenue outside of marketplace which did not occur in the quarter ending December 31 2019.Recurring revenue of Q2 of 2020 grew 3% to $4.04 million, up from $3.89 million in the same quarter of fiscal 2019. Year-over-year recurring revenue as a percentage of total revenue increased 70% to 83%.Year-to-date, fiscal year 2020, total revenue decreased from $11.51 million to $9.64 million for the first six months of fiscal 2020, down 16% from the same period of fiscal 2019. It should be noted that last year's six months revenue included $2.3 million a non-recurring one time revenue which did not occur in the same six month ending December 31, 2019. In other words, all the revenue decline is a one-time revenue.Recurring revenue for the first six months of fiscal 2020 grew 3% from $7.8 million in fiscal 2019, to $8.1 million in the same period of fiscal 2020. Recurring revenue for the first six months of fiscal 2020, as a percentage of total revenue increased from 68% in fiscal 2019 to 84% in fiscal 2020.In the second quarter of fiscal year 2020, total operating expenses were $4.2 million an increase of $327,000 or 8% from $3.9 million in Q2, 2019. This 8% increase is largely the result of higher marketplace cost, then increase in sales personnel costs, timing of expenditures and higher depreciation due to our headquarters relocation and data center expansion, that was completed in June of 2019.Year-to-date fiscal 2020, total operating expenses for the first six months of fiscal 2020 were relatively flat at $8.87 million versus $8.81 million, up 0.7%. As I’ve said before, it takes $17 million to run this place absent marketplace cost. As we have added three additional sales staff to accelerate our Tier 2 initiative, we anticipate reductions of other areas to maintain net neutral increases and total operating expenses for fiscal 2020.In the second quarter of fiscal year 2020, net income to common shareholders for the second quarter of fiscal 2020 was $517,000, or $0.03 per diluted share, compared to $1.5 million or $0.08 per diluted share, in a year ago quarter. The decrease in net income to common shareholders was largely a result of $1.1 million less one time revenues and higher marketplace costs.Year-to-date fiscal 2020, net income to common shareholders for the first six months of fiscal 2020 was $548,000, or $0.03 per diluted share compared to $2.4 million or $0.12 per diluted share in the year ago period. The decrease in net income to common shareholders year-to-date was largely result of $2.3 million less one-time revenues and higher than anticipated marketplace costs.The common stock buyback plan, under the current stock buyback authorization we’ve repurchased 174,615 shares of common stock at an average price of $4.80 per share in the December quarter for a total of 838,000. Today, we have repurchased a total of 342,170 shares of common stock, at an average price of $5.37 per share for a total of 1.8 millionAs previously stated, the company holds no treasury stock. The stock purchased under the buyback plan is retired from issuance and hence reduces the total amount of common stock outstanding. Since May 2019, the company has reduced its total capitalization by 1.5% for the stock buyback program. The total amount remaining under the buyback plan for purchase and retirement of common shares under the existing repurchase plan is approximately $2.2 million over the next five quarters.Once again, we stated to maintain our goal is to drive recurring revenue as a percentage of total revenue to 80% or more. We have achieved this goal for the quarter, and in fact, it was our third quarter in a row with recurring revenue over 80%. However, keep in mind, we will always have customers that demand to buy meaning license versus rent, meaning subscription and we will consider these situations when the pricing and value makes sense.In short, we have a strong balance, the strongest in our history. We have a proven ability to generate cash $2.7 million to-date. We are profitable, we have an established end-to-end solution that addresses significant needs and one of the largest sectors of the global economy. We're focused on growing recurring revenue and backfilling $4 million to $6 million a onetime revenue with recurring subscription. We're adding more feet on the street, more cross sell opportunities, and growing the network, growing the network, growing the network.At this point, I will pass the call over to Randy, Randy?

[Randy Fields:]

Thanks, John. We reached an interesting inflection point this quarter, and I think that it demonstrates that our transition to a revenue mix dominated by recurring revenue is definitely accelerating. As most of you know transitions from one time revenue to a SaaS recurring revenue model are challenging for most companies, typically driving losses, upsetting customers incurring debt et cetera until the transitions complete. We're certainly the exception.Through this process, we've continued to generate substantial cash and therefore are seen an increasingly strong balance sheet, the strongest certainly in our history. We remained solidly profitable and we continue to grow our network at top tier sales people and drive shareholder value. The revenue declines from focusing on recurring revenue is transient, is already abating, as the revenue growth from recurring revenue is accelerating.We grew our recurring revenue 3% for the December quarter. Please remember, new subscriptions do not begin on the first day of each quarter, but begin throughout the quarter. But, by the end of the quarter in December, our monthly recurring revenue run rate increased to more than 8%. What should this mean to us as investors? Given the subscription revenue is recurring, our run rate of 8% may provide line of sight to our recurring revenue for the subsequent quarter assuming no incremental growth.Our exit rate in the September quarter, meaning September 2019 versus September 2018, was 4%. So, our pace doubled in the three months clearly, demonstrating interfaces in fact, accelerating. We expect the exit rate in March to be higher than in December, and so on and so forth. We believe investors can view double digit starting rate for our recurring revenue going into fiscal year 2021.Since approximately 85% of our total revenue is recurring now, that growth rate should be an approximate surrogate for our topline growth as we go forward. For the third quarter in a row, over 80 plus percent of our total revenue was recurring. One time revenue other than marketplace remains negligible and recurring revenue is growing. As John pointed out, the proof is in the numbers.I'm proud that we've achieved this important transition while both maintaining profitability and at the same time, strengthening our balance sheet. I continue to believe the profitable growth is still something that's largely overlooked these days. Cash is certainly still king, strong balance sheet is critical, particularly in our case. Our customers demand it and our balance sheet gives them comfort.In fact, our balance sheet and deep customer network, we'll talk about that a bit more in a moment, services are really white moat around our business, a durable barrier of entry for start-ups or outsiders who might seek to displace this. Our near-term focus is on further penetrating our current customer base with upsells and cross-sells. We're very excited about how we're in fact progressing, a little bit more about that later.Let me speak to the key performance indicators which will contribute to financial performance in the future. First, network scale. Growing the scale of our network is of key importance because, it's ultimately the indicator of our future growth and profitability. We do have two metrics that we internally follow, the number of participants in the network and the number of connections between them. From a connection perspective, as of December 31, we had nearly 100,000 facility level connections in our compliance system. Our total connections across all three segments of the business is multiples of that.Just for a perspective, four years ago, we had a couple of thousand compliance connections. Another metric we follow is the number of participants or customers. About five years ago, we had around 800 total customers in our system across all of our platforms, today we have 27,000 that's scaling . The size of our network and its growth in numbers enables us to do what we call land and expand.For example, take our focus on our Tier 2 hub initiative, every year 2 Tier hub brings with it about 80 new suppliers to be added to the network. Each of these suppliers, in turn has suppliers of their own representing both an upsell and an expansion opportunity. Flawless execution with compliance is paramount and leads to additional opportunities, such as, our supply chain offerings, marketplace, et cetera. As usual, I know if you've listened to me before our customers come first, now, always.The opportunity is enormous and the pace of our network to expansion is accelerating rapidly. Keep your eye on it. As John mentioned, we have recently added substantially to our sales team based on the size of the opportunity and our initial success. We're focused on driving our growth in both numbers and the size of the connection stream associated with those numbers of participants. Our growth in these two metrics drives the work we have to do much more closely than it drives our near-term revenue.In other words, we add customers which may not immediately impact revenue, but ultimately does. The result is that when our network grows rapidly as it is now, we need to double down on our focus on execution to pave the way for the next round of additions. The team is executing magnificently and seriously, I mean magnificently.During the second quarter, we made tangible operational progress in each of the three revenue streams. Let me start with compliance. We added a significant Tier 1 hub in the quarter, and more importantly, we added nearly 40 Tier 2 hubs, since the fiscal year began. A year ago, we had only 25 total Tier 2 customers that we've won cumulatively over the years. We ended the December quarter with a total of 90 Tier 2 hubs.This growth was generated by only one dedicated tier two salesperson, and as I mentioned, we've added additional resources dedicated to accelerating this growth. Our marketing initiatives are working that we're on track to reach probably just under 200 total Tier 2s by the end of the fiscal year, that will be a nearly 400% increase.However, from a network perspective, keep in mind that this year could add nearly 12,000 more customers 12,000. We began the year with 23,000 customers, so this is nearly a 50% increase for the year. In the next year we're hopeful of crossing the 50,000 participants mark. The number each new supplier becomes an upsell candidate but then there's short run increases our need for our continued brilliant customer execution. The size of the network interestingly becomes self-fulfilling. More companies want to join the largest network and the size of the network increases our effectiveness and the attractiveness of our other offerings such as, marketplace.It's important to note that not every customer signs up on the first day of the quarter, and that there's some work required to ramp up users after a sale is made. For this reason, we now see the exit rate and monthly recurring revenue is the best indicator of our progress. Ending Q2, our monthly recurring compliance as we mentioned, revenue exit rate increased to 8% December compared to prior December, double the rate of the September quarter end.So, double digit recurring revenue growth is ahead, not very far ahead. We have a good line of sights. So, this view is based on agreements we currently have in place and we simply have to continue to provide to flawless execution and deployment. We're certainly executing with a clear mission to scale the network until we touch and connect everyone in the supply chain for U.S. food. Incidentally, we're also making progress to replicate this model outside the United States.During the fiscal first quarter, we signed our first ReposiTrak compliance out in the United Kingdom, and will commence implementation in the month of March. Our first account in the UK is one of the most prestigious wholesalers and retailers in the country and assuming we maintain our excellent customer execution standard, it will give us a great launch not just in the UK but potentially give us a springboard to Europe and in fact to Asia.A little bit about supply chain. In supply chain our Out-of-Stock management solution is a clear and overwhelming win. As a result, we continue to believe supply chain will be a standout performer in fiscal 2020. While, each new customer in compliance is relatively small financially, each ad in our supply chain business is typically much more meaningful.Subsequent to the end of the second quarter, our Out-of-Stock management solution was endorsed by the Food Marketing Institute, FMI. It’s a very significant milestone for us in an industry that's always skeptical. We're grateful for this accolade and FMI's endorsement reinforces how critical and significant the Out-of-Stock issue is, and certainly, validates our offering as an effective solution.Out-of-Stock have been an age old issue for the grocery industry, but as online competitors like Amazon, expand home delivery, Out-of-Stock have taken out a more critical importance for food retailers. They aren't just watching loss sales, more importantly, they're watching the loss of customers.Many retailers are now just beginning to recognize the magnitude of the challenges customers come into their stores, don’t find what they need, pull out their phone, see it in stock on Amazon, and click to order it. Interesting statistic by the way. 24% of Amazon's North American revenue comes from these disappointed shoppers, people who started on Amazon because they couldn't find it in a physical retail store.Our results were impressive in terms of the efficacy of our solution. 70% of vendors using our Out-of-Stock solution have reduced Out-of-Stocks by an average of 46%, and that's across 12,000 stores, where we're working today. Our effect under that reducing Out-of-Stock exceeds, even my expectations, to say that I'm proud of this part of our execution would be a grotesque understatement. In our typical fashion, now we're carefully, slowly, growing the usage of our tool.Now, the marketplace. During the first fiscal quarter, we added two new buyers from the marketplace network. We're starting to see their expansion and contribution to marketplace and that's showing in our financial, albeit as non-recurring revenue. We continue to push the boundaries of marketplace and it continues to move along very well. It is non-recurring revenue, but we still think that it's very important both ultimately to us and to our customers.In some, it's wonderful to have all three of the areas of our platform growing and doing well. Wonderful indeed. We remained uniquely positioned in our ability to help a buyer source that and transact efficiently with a new supplier and we have multiple modes to run their business.Our efforts to reduce one time sales in favor of the idea of recurring revenue that drives predictability maximizes profitability is nearly complete, well ahead of our original plan. The progress was made to accelerate Tier 2 growth will hit an inflection point later this year, and our operational progress will be continued to show up in our topline results.In the meantime, to judge our progress through this transition, I'd reiterate our key operational goal. Under compliance, we suggest watching our Tier 2 adoption. We have that we're on track and on pace, if you will, to increase the number of Tier 2 hubs using ReposiTrak by several hundred percent to just under 200 by the end of the year.In supply chain, we intend to drive our Out-of-Stock program to more rapidly grow our supply chain recurring revenue business, focusing primarily on our existing customer base. And finally marketplace, simple, continue to add new buyers, new programs et cetera. So, with strategic and deliberate execution, we will continue to grow our bottom line, our cash generation and add additional strength to our balance sheet.So with that, I'd like to now open the call for questions. Operator?

[Operator:]

Thank you. We will now be conducting a question-and-answer session. [Operator Instructions] Our first question comes from the line of Tom Forte with D.A. Davidson. Please proceed with your question.

[Tom Forte:]

Great. Thanks for taking my question. So Randy, I wanted to ask you a couple of questions about the current state of global events, and implications for Park City Group, ReposiTrak and marketplaces.So, when we think about the coronavirus, we think about the food supply chains, the global food supply chain, in particular in China, how does this fit into both the business model and how does it bring attention to your business model? And then when we think specifically about marketplaces and your ability in the past to enable merchants to get products from a verified supplier to short order, actually think about that as well.

[Randy Fields:]

Thanks, Tom, good questions. Let me take the first one first. Remember, coronavirus started out as a food problem from what we currently know, meaning it originated in something that somebody ate. The interest in China is increasing and we've been having conversations with potential partners in the Asia to take our platform there.So whenever there is a problem of risk, safety, et cetera, it just generally sensitizes the environment to what do we do to contain our problem, how do we make sure that the suppliers were working with our good guys, not bad actors. So overall, almost every incident that relates to safety, benefits us, at least, in terms of heightening awareness.I think with regard to the second question, there's a huge issue going on with the Chinese supply chain. And we've certainly had a number of inquiries around marketplace on how we can potentially find products that have already landed, that are not stuck now in a port that isn't functioning in China. So, at least over the short-term its neutral to positive, obviously, this is potentially a catastrophe for the people who are ill. We feel obviously awful about that. But, from an economic perspective, at this point, it's neutral to positive for Park City Group, ReposiTrak.

[Tom Forte:]

Then Randy, my second question is more structural. So, when we think about your sales force as you fully implement the recurring revenue, is it on a by customer basis, or is it on a byproduct basis, meaning ReposiTrak versus supply chain versus marketplaces, or large food retailer in one individual sales force?

[Randy Fields:]

Yes, actually, we technically have two different sales organizations still. We've added capacity, added people to both of those organizations in the last several months. One of those, is if you will, dedicate to the compliance aspect of what we do, in particular to what we've called this Tier 2 initiative, which is to get suppliers to use us for their supply chain. That's going exceptionally well, we feel very, very good about it, and I think over the next several years, it will help us to enormously scale the number of customers we have in the network.At the same time, we've added significantly to our general sales organization, with the intention that we're now going after more top Tier 1 kinds of both compliance and frankly, supply chain retailers, wholesalers. So, between the two different sales organizations, we have more people time over target than we've ever had in our history. And obviously, that's an indicator of what we think both our ability to execute is very importantly.But secondly, just our confidence in how we do it, and how we scale it ought to be. So, at the moment, it all feels very good to us. And frankly, I think, again, we just want to point out that any cosmetic or optical sales declines are only in the one-time revenue, that the recurring revenue is accelerating from 4% at the end of last quarter to 8% at the end of the most recent quarter that we finished. And we obviously have line of sight that gives us a lot of confidence, it will be double digit on a monthly basis by yearend, which tease us up for a double digit revenue growth next year.So the transition, I'm kind of hitchhiking to make sure it's clear, the transition to eliminate one-time revenue, which we originally thought could take up to two years, we think will be largely complete in a single year. So internally, we're feeling very good about how things are building.

[Tom Forte:]

Great. Thanks for taking my questions, Randy.

[Operator:]

Our next question comes from the line of Ananda Baruah with Loop Capital Markets. Please proceed with your question.

[Ananda Baruah:]

Hi, good afternoon, guys. Appreciate you guys taking the questions here. Few, if I could for both Randy and John. Hey Randy, just a follow-up right there. So, without getting like be physical on the timing of the return to rev growth, is it possible with the compares? And then, with the growth of recurring that you could return to revenue growth this year in calendar '20, or should we really take that being a calendar '21 event so, you guys are trending pretty good yet with your schedule?

[Randy Fields:]

Well, let me say this about that, I sound like Richard Nixon. Clearly, we are evidencing optimism that before the end of the year we will be clomping positively, but again, we would argue that the onetime revenue which should be heavily discounted anyway, we're already clomping positive and detect great growth rate, our revenue comp will accelerate. So, we will have a very likely a quarter in this fiscal year that is positive comp all-in, all-in, all-in.And clearly next year, what we're suggesting is, that the growth rate of total revenue, like-for-like will be double digit. So, the elimination of one time revenues, the replacement of that with recurring revenue is largely complete and it'll show up in the total numbers, we think prior to yearend, fiscal 2020. But, not enough that we will overcome for the full year positive sales but, for the quarter, we feel pretty good about that fourth quarter.

[Ananda Baruah:]

That's very helpful. And is there anything that you can tell us about how you're thinking about recurring revenue, I don't know what the right word is tempo or kind of slow growth rate that would be useful for us to think about? What you're expecting, what may be some of the upcoming key levers are, things that are influencing that, so we will continue to get a development year about how that business could develop?

[Randy Fields:]

Okay, so let me take your question and reframe it slightly. And so if I'm out of line here, feel free to say so, obviously. If I were trying to understand where we're going from a revenue and bottom line perspective, and it's not my place, but here's what I would do, I would take what we call our exit rate in any given quarter and I would roll that number forward in terms of growth rate of recurring revenue for the next quarter, because it just tends to be a very stable number within a quarter.So, for example, if we just said our exit rate in the month of December is 8%, well, you can probably figure out from that, the growth rate of total recurring revenue in the quarter that we're currently in quarter three is going to be somewhere between 6% and 10%. And we said that by yearend, it will be double digit for a monthly, which means as you exit this year, and look at next year, growth rate of revenue will be double digit.Now, the modifier to that is that, in fact, one time revenue will have been compressed to less than 15% of total revenue, which actually means and that's why I was saying in my remarks, growth rate of recurring revenue will become for all intents and purposes, the surrogate that you need for growth rate of total revenue of the business. So, we've tried to make this about as easy to forecast as possible.So, you can make the assumption that John would give you which is, our cost of being in business is around $17 million a year more or less, even with the people we've added. And that our recurring revenue stream becomes really the revenue stream and that next year, we're going to experience double digit topline growth, minus $17 million of expenses. So, it will be a very good year indeed. Is that helpful?

[Ananda Baruah:]

It is. I appreciate it. And then let me just sneak one more in here. Since you're at the start of the year, look, you've most probably gone over -- in the prepared remarks, in the Q&A so far, some of which are your key initiatives through the year, but I just want to ask the question broadly so that we don't miss anything. How would you like us to think about? What you guys are focused on this? What you guys are up to? Anything you haven't mentioned yet so that we're aware of that, I'd appreciate it. And then that's it for me.

[Randy Fields:]

Okay. No, I love that question because that's open ended enough, I can talk about almost anything. The Tier 2 initiative really is a big part of our future has some very interesting impacts for the business. And I'm trying to guide people to look at the growth of the size of the network, because remember, at the end of the day, ultimately, our revenue and our profitability depends on whether the network is growing plus a time lag. So, as I said, five years ago, we had 800 customers, we currently have 27,000, we’ll finish the year in the 30,000s of customers, and I'm sort of guiding people to think that by the end of 2021, we’ll be very close to 50,000 participants in this network.Wow! I mean, even I'm impressed with that scaling. So in a way, what we need to be doing is growing the revenue base from those customers, the cross selling activities, the upselling activities, that's why we are adding sales people to the mix. And we will continue to do that as we add to the size of the network. But the network girth makes us more attractive to others to join. It's sort of like the cell phone business, you wouldn't want to join a network that didn't connect very many people, you'd want to join the network that connected the most people, and that is certainly us.So, as we look at what we're doing, we're feeling very confident about the Tier 2 initiative. Important to note that virtually all of our growth now is coming from existing customers, that's really remarkable, meaning people we already do business with, which means as we grow the size of the network, the cadence should increase and the revenue growth should increase.The constraint continues to be the fact that when you add 50% as we are to our network, that determines the amount of work that we have to do, more than the revenue growth. So, 50% expansion of the network this year, tells us how much work we have to do to continue to take great care of our customers. That's the primary initiative.Now, having said that, everything else we're doing in our supply chain is going really well. I'm frankly, really impressed with how well we're doing on our Out-of-Stock work, that will drive revenue growth in the supply chain before this fiscal year ends in June. And timely, we don't talk about it this much, marketplace is definitely growing, it's growing in double digits and we're seeing more and more usage, which was the goal of existing customers, meaning people would try it, they would come back and expand their footprint and come back again and expand it even more.So, I'm really impressed with how we're doing on the marketplace side of what we're doing. All three, we're hitting on all eight cylinders, if you will, or all three cylinders. And all of those initiatives are occurring on top of taking great care of a 50% expanded customer base, which is what we're dealing with. So, if I were to be any more optimistic than I am today, I would be giggling, I suppose.

[Operator:]

There are no further questions in the queue. This does conclude today's teleconference. Thank you for your participation. You may disconnect your lines at this time and have a wonderful day.