Superior Drilling Products, Inc.
Q3 2021 Earnings Call Transcript

Published: 12 Nov 2021

[Operator:]

Greetings. And welcome to the Superior Drilling Products Third Quarter 2021 Financial Results. At this time all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. . As a reminder, this conference is being recorded. I’ll now like to turn the conference over to your host, Ms. Deb Pawlowski, Investor Relations for Superior Drilling Products. Thank you. You may begin.

[Deborah Pawlowski:]

Thanks Melissa, and hello everyone. We certainly appreciate you joining us today as Superior Drilling Products reports on its third quarter of 2021 and talks about the progress that we are making with our strategy and growth. I have joining me Troy Meier, our Chairman and CEO; and Chris Cashion, our Chief Financial Officer. You should have a copy of the financial results that we released before the market this morning. And you should also have the slides that will accompany our conversation today. If you don’t, you can find both of those documents on our website at sdpi.com. Turning to slide two, I will point out that we may make some forward-looking statements during the formal discussion, as well as during the Q&A session. These statements apply to future events that are subject to risks and uncertainties, as well as other factors that could cause actual results to differ materially from what is stated here today. These risks and uncertainties are provided in the earnings release, the slides and other documents filed by the company with the Securities and Exchange Commission. All of these documents can be found on our website or at sec.gov. I want to also point out that during today's call we will discuss some non-GAAP financial measures, which we believe will be useful in evaluating our performance. You should not consider the presentation of this additional information in isolation or as a substitute for results prepared in accordance with GAAP. We have provided reconciliations of non-GAAP with comparable GAAP measures in the tables accompanying the earnings release as well as in the slide deck. So with that, if you would turn to slide three, I will turn it over to Troy to begin.

[Troy Meier:]

Thanks Deb. Thanks, everyone, we appreciate you all taking the time to participate in the call today. As we go through this slide deck, I want you to keep in mind that some of the things that we've been working on is, as we talk about our Quality Management System, I'd like to start there. As you all know, we've been working on that for about the last year and a half. And we need the TQM process system in our shop and it's performing very, very well. We've passed our year audit on the ISO 9001 and also the AS 9100. And we're very proud of what the team has done there. And it's really starting to show a benefit in our -- both to our customers and also to our processes and our controls. So like to thank our team for what they've done there. But also like to recognize our procurement team. They've navigated, this mess that the supply chains are seeing globally, they've done a really good job. And they've been making sure that we've got the materials needed to fulfill our customer's orders. And they continue to look at critical stock inventories and wherever we're getting products from and they're doing a really good job on that. I'd also like to recognize our HR, we've been able to identify and hire some really good young talent. They're very alert and very aggressive and eager to learn. And I'm really proud of what we're doing there as far as bringing on some fresh talent that's going to really help us do some wonderful things going forward. So if we look at the business overall, you see there's a strong demand for our tools, not just manufacturing, but in the refurbishment side of the business. We have the Drill-n-Ream as you all know, its value is being proven every day, day in and day out and more and more customers are understanding that value. We're seeing a very strong demand for that tool here in North America. Customers you know are when you look at our channel partner, there's DTI they've done a fantastic job there and they continue to bring on new customers and continue to grow that business and that's starting to show and we're seeing a lot new tool orders come in, and they're bringing on new customers all day, every day, and we're very proud of what they're doing. If you look at the revenue in North America, I mean, our manufacturing team has done a fantastic job. As we're now asked to produce some very complicated parts that need to be very precise for certain types of drilling systems, they're doing a wonderful job there. Our management team there is again identified some great new talent that we're bringing in to support our existing team of machinists and tech's they're doing a wonderful job there. And we're seeing that really -- people are really noticing the quality that they put out and complicated parts, they don't seem to, they enjoy the challenge, let me put it that way. So that's really becoming a very unique part of our business. If you look at the PDC refurbishment activity, in both the Drill-n-Ream is strong, and the drill bits are strong. So again, even though, we look at the rig activity, and those of you that have been with us since the start of this whole IPO process when we went public years ago, and we were 2000 rigs close to it, like 1947 or something like that. And so today, when we're at 550 and as busy as we are, it shows that the rigs that are up and operating are drilling a lot of footage. And they're doing it very quickly and very efficiently and the demand on tools is high. So again, that metrics that we always use, looking at the drill rig count to look at the production, how productivity is going to go through our facility, are we going to be really busy or not. And we've got to -- we've got to have a new look at that. Because service companies as most of you are aware, very busy right now. And, again, our rig counts only 550 so in the U.S. We look at our international part of our business, our team over there continues to knock down barriers, and there is a lot of them. We've made some good penetration into some markets, our tools are performing well. We now have caught the attention of extremely large service provider. And they're liking how the performance of the tool is working and cutting time and days off of wells, the wellbore quality, they have a lot of wellbore quality issues. In the Mideast, they deal with different formations and some very tough ones. And they're finding the Drill-n-Ream is helping them out there and we're starting to see that business over there drill for us. We've got a management team in there they've done a fabulous job. We've got, even though we're very small, we've only got -- we're very small team over there, they're doing a tremendous job. And we're starting to see some really good penetrations into some markets and we're looking for some big things from that team as we go forward. We're strengthening our relationships, as we look at the service companies that we deal with, in the energy sector, they're the largest ones and we're building a strong relationship with them every day, we go to work with the attitude of what else can we do for these companies, where else do they need us. And we're starting to find that there's a lot of things that we can pull away from them and really not pull away but take that responsibility and make those parts and get them. And we've seen that in the third quarter. We made a lot of new products for the service companies and they're performing very, very well. So there's a lot more opportunity there and we can talk about that in future opportunities. So with that being said, I'm going to go ahead and turn this over to Chris and he can start going over the numbers. Chris?

[Chris Cashion:]

Okay, thank you, Troy. And welcome everyone. Let's continue our review by turning to Slide six, where we provide an overview of revenue growth. You can see that in Q3 revenue grew 5% sequentially, and 130% year-over-year. This was largely supported by our North American business where we have seen increases across the board, as Troy alluded to, in all of our businesses, drilling, tool, sales, royalty and repair fees, higher contract services revenue, everything progressing really nicely. We are benefiting from an increasing rig count as we ended the quarter with an average U.S. rig count of 497 for the quarter, up 10% from the second quarter 2021 and nearly doubled the level from the average in the third quarter of last year. Of note, the U.S. rig count is in that mid 500 level that Troy mentioned specifically on October 29, 544, and as of last Friday 550. Additionally, we are seeing higher demand for the Drill-n-Ream giving us supports the efforts of operators to improve rig efficiencies. That's the value proposition that we've demonstrated and continue to demonstrate. We continue to be optimistic that the recovery that we have seen so far this year will continue at a steady pace and support growth in the fourth quarter, as well as provide nice momentum as we head into 2022. International revenue growth demonstrates growing market penetration including our strength in customer relationship that Troy just highlighted. The international rig count quarterly average has now increased over the last three quarters. And that average was up 5% sequentially in Q3. Overall, our international revenue was up 14% sequentially, and 22% year-over-year. While this is not at the level of growth that we see in North America, we continue to see positive developments and are gaining traction with our strategy internationally. We believe we're going to further penetrate these markets as we partner with global auto service companies and benefit from increased market activity as well as new product development efforts. Now let's turn to Slide seven and take a little deeper look at tool and contract services revenue. The year-over-year improvement in contract services reflects higher PDC refurbishment work from an increasing rig count and the expansion of products we manufacture for our long-term legacy partner. Tool sales and rental revenue were up measurably since last year's quarter as our distributors drilling rig tool fleet both expands and is upgraded with replacement tools. However, sales were down slightly in the quarter $284,000 sequentially, which does reflect as a lumpy order pattern that we have seen with recovery. Troy will talk to the strength we are seeing right now in new tool orders in this quarter and when we followed up with opportunities. Of note international revenue is also included in this revenue line item as we are running our tools in the Middle East. Other related tool revenue, which includes the drilling rig, maintenance and repair fees, as well as royalties was up $357,000 or 31% sequentially. This increase demonstrates the market demand for the Drill-n-Ream in North America. Now as you can see on Slide eight, we are maintaining our cost discipline as we've been able to effectively manage inflationary pressures while continuing to invest to support current and expected demand. Like many others finding employees has not been easy, and our teams are working hard around hiring and training. Our efforts regarding improving the onboarding process and leveraging our senior staff experience with new processes and quality management programs is paying off. We've been able to fill a number of positions and move staff up the learning curve, including specialized high end PDC bits razors. That thing will continue to be a focus area as we move forward. In total, third quarter operating expenses were up a modest 3.5% sequentially, mostly due to cost of international sales. As a result of our cost control efforts and given the higher demand in the market, we generated operating income of $163,000 in the quarter, the second straight quarter of positive operating income, further validating the progress we're making. This compares with the significant operating loss in last year's comparable period. We can see that further on Slide nine, when we look at our bottom-line and adjusted EBITDA results, both of which have improved significantly over last year. Our earnings per share is breakeven and adjusted EBITDA, which we use is a measure of operational performance was $853,000 or 23.9% another strong EBITDA quarter for us. These results clearly demonstrate the strong leverage we have on higher volume in this business. Please see the supplemental slide at the back of this presentation deck that has the reconciliation table from GAAP net loss to non-GAAP adjusted EBITDA. Now, let's go to Slide 10, where we highlight our balance sheet, which has continued to strengthen with lower debt levels. The company generated $878,000, almost $900,000 in cash from operations during the year late period. And our cash balance at the end of the quarter was $2.5 million up from $2 million at the end of 2020. Long-term debt, including the current portion, at the end of the quarter was 2.6 million, which reflects a principal payment of 750,000 made on the hard rock note during the quarter. We now have just one remaining 750,000 principal payment due on that note, which is payable next year, in October. So that's October 2022, is the due date for that last principal payment. Finally, after the quarter closed in October of this year, the company completed an equity offering of 1.7 million shares, priced at $1.15 per share, resulting in net proceeds of approximately $1.7 million. We felt that the timing was appropriate to raise some capital support our growth opportunities. So with that, I'm going to turn the presentation back to Troy to wrap up with a review of our outlook and opportunities. Troy?

[Troy Meier:]

Thanks, Chris. As we go to Slide 11 and we look at our opportunities going forward, one of the things that I'd like to mention is, we're going to continue to bring on some staffing, we've got a lot of training of personnel that we're currently doing. We've got a lot of maintenance that we've got to get done. We've got -- as we look at the strong demand that's currently being placed on our manufacturing and PDC side of the business, we'll address that. And we've got, like I said, some really good talent that we've brought on, we're really happy with the how that they're picking up some of the critical portions of our manufacturing. So when we look at North America, we believe that we're going to have some great opportunities going forward, as we -- like I was saying earlier, we've identified other product lines that we can pick up that fit in our wheelhouse. When you look at our manufacturing capabilities, we've got large machines that do very, that are capable of doing very complicated and precise parts. And we're identifying those all the time, we're still looking at diversification. We've got some good things that we're doing there when we look at going in, away from the oil and gas sector to bring in this diversification portfolio into our company. We're still going down that road, and it's moving ahead very well. International, we've got a strong tool fleet over there now. We've got a fleet in multiple countries. And we've got some good strong performance going on in those countries. And we've made some really strong allies with some large service companies. So we're looking for international to really, really show us some good growth and in 2022. So we'll keep on plugging through this and I think our fourth quarter is going to be strong in the manufacturing and repair right now it is and I would believe that it's going to continue to stay that way. I do want you to understand that's not usually what happens in oil and gas industry, we usually see a slowdown in Q4, it seems like rigs have drilled their quotas. And we're not seeing that this year we're seeing, customers demanding -- our repairs getting through our shop and an ordering new tools. So the typical lay down and slow down of rigs, this time of year is not happening. So, with that being said, I'm going to go ahead and turn it over to questions and answers.

[Operator:]

Thank you. At this time, we'll be conducting a question-and-answer session. Our first question comes from the line of Dick Ryan with Collier Securities.

[Dick Ryan:]

Thank you. Troy, you mentioned kind of catching the attention of one large service provider internationally. Is this somebody new? And can you expand on it a little bit? Or is this one of the major service providers that you had been working with -- is becoming a little more active?

[Troy Meier:]

It's the largest service provider and we started working with them in 2Q and showing them the benefits of the Drill-n-Ream product line on an international stage. They've used it here and are familiar with it here in the U.S. and they've enjoyed the benefits of it. But when you go international, as you know, it's like dealing with a whole new company. And we've been able to show them some tremendous benefits with the Drill-n-Ream. And they've now been giving us more and more rigs to supply and where we're looking forward to some really good opportunity with them as we roll into 2022 and throughout 2022. We've even made a few tools, custom for certain applications for them. And it seems to be very beneficial for them.

[Dick Ryan:]

Which countries are you now generating revenue from internationally?

[Troy Meier:]

We got Kuwait, Oman, the UAE, we still have a process that we've got to go through that. Right now we're analyzing the amount of work that will give versus first the time and money it's going to take us to bring on another quality system. And we also have some tools in Iraq that will be going in the hole. That's a new area for us that has some extreme challenges. But if you look at our traditional revenue has been coming from Kuwait and we brought on Oman. We are now looking at Saudi, we're bringing tools we're manufacturing and shipping tools there now. And then, we also again have inventory ready to rock in the UAE. SO those are the countries we're currently in.

[Dick Ryan:]

What challenges are there, can you reach across these borders with service and repair or do you have to be located in each one? How was that shaping out?

[Troy Meier:]

So the biggest challenge we currently have is still COVID-related, they are still in a major lockdown. We were penetrating to wait very well up until second quarter of last year when they shut everything down. And so when you see -- you may see 25 rigs shown in Kuwait. But that doesn't mean those 25 rigs are really drilling as efficiently as they can be drilling. I mean, they're, very short staffed in all of these countries that the expats that have typically come from Canada from the U.S., from England to support these drilling efforts, they're not willing to go through the COVID criteria of going in and being -- you got to isolate for two weeks, you've got -- there's a lot of restraints that are still being placed on the workers over there. So when you look at 25 rigs, in Kuwait, you're really seeing rigs that are probably performing about 50%. And a lot of them have gone to just go into work over rigs working over existing wells because they cannot find the personnel to drill to keep these wells and to be able to drill 24/7. When we look at the challenges that we have going across borders, we're doing we're getting better at that. We're learning a lot about logistics, our team has done a really good job there as far as shipping tools in and out. It doesn't seem to be the hassle that it was as we're getting more and more known over there. We get people that are willing to participate and not just stall you and that's seems to happen a lot. Things just take a long time and there's a lot of steps that you've got to take to get even the simplest things done. But we're finding ways around that and we're getting a lot more efficient with that. We can repair tools to answer that part of your question, we are still looking to put a repair facility in Dubai, the issues that we've have with that right now, or we've identified our facility, we're excited about getting moved in and getting we've got most of that equipment ready to go and be put in there. We just got to identify a team that can travel in and out for training and still meet the COVID restrictions that are placed on even in Dubai. But we have got what we call a level one repair service can be done. We do that in Kuwait. We do that in Oman. And that's simply just checking the threads, the connections on either end of the tool. We do a max particle test, make sure there's no cracks in the tool. And this is all after the tool has been run. We also have a goal grade evaluation that takes place on these tools. We are able to have our team in Dubai and they can drill grade tools in Oman, they can drill grade tools in Kuwait. Our management has set up a really good web-based system so that when we see the tool, we can drill grade it right online. And that's working very efficiently. So, I think when we look at international and the challenges that we're going to face in 2022, it's mainly going to be COVID-related. The team is very well trained now and we've got some good offset results of the performance of our tool and we're ready to share that with every drilling contractor over there. So it's the challenges will be still COVID related.

[Dick Ryan:]

Okay. One last one, on contract services, looks like you're seeing expanded opportunities with Baker what could that mean, as you look down the road?

[Troy Meier:]

If you look at contracted services, it's not just us doing third-party machine work that's not what we want to be known as. I mean, our team is extremely good at it, making high-quality complicated parts like we talked. However, we identify those parts that add additional value to our organization. So we take parts that we machine in the machine shop, and then we take those over to the bit -- PDC side of our company where we do the hard facing application, the braising application, just like it was -- if a tool was coming in to be repaired. So when you look at the third party, that's portion of our business, we're really doing a good job identifying those parts that we can turnkey, new parts that we turnkey, not just machine, but we turnkey the whole part, they give us that part. And they want that thing ready to go down the hole when we give it back to them. So it's a larger process and gives us a lot more opportunity to capture additional revenue. And that's what we're identifying. It's very exciting. We take those parts that are machined in the machine shop. We take them over into the PDC side of the business, it's hard faced, it's grazed, its ground, it's inspected, it's painted, and it's shipped as a complete turnkey part. So there's a lot of opportunity there. And I think you'll see it in 2022, as we start bringing on some additional service companies that are really excited about the opportunity of us supporting our growth.

[Dick Ryan:]

Okay, great. Thank you. And congratulations on the good execution and the outlook going forward. Thanks.

[Operator:]

Thank you. Our next question comes from line of John Bair with Ascend Wealth Advisors.

[JohnBair:]

Nice quarter and nice momentum. Troy at the end of your prepared comments, you mentioned that you're not seeing the traditional fourth quarter slowdown by the E&P companies. And I'm wondering if you're also hearing from them, of perhaps a step up in their activities, given the fact that duck inventory is been drawn down quite a bit?

[Troy Meier:]

Yes. What we typically see is, this started happening probably around, I would say, when we started really seeing some drilling efficiencies. And I'm going to say it's been for the last 10 years, we would -- they have their drilling budget and they're going to drill 36 wells with this rig. And those wells should finish up sometime in December, because of the efficiencies that they gained through not just the efficiencies of have been able to pump more fluid down the holes to put more weight on your bottom hole assembly to top drives, with what they have done, been able to figure out how to drill the curb, all of these efficiencies, every year have gotten, better and better and better. And so we'd always get to -- typically we get about to October, and they say, well, we drilled our budget, we're going to lay down rigs, but we'll looking to pick them back up in January. This is not the story today. And then, it's like I say, it's been a long time, since I've heard of companies wanting to add tools in the fourth quarter and get ahead of the repairs in the fourth quarter. Typically, they wait until January hits and then they slam as hard. But they're not doing that this year. I think we're going to continue to see rig count climb, I think it's going to be a slow growth. I think the challenge that the industry has, just like every industry has right now is finding personnel that can command those rigs and can get those tools to the rig and can service those tools when they come in from the field. So I think we're going to see a slow steady growth pattern continuing through the fourth quarter because nobody can afford to lose hands right now. And so they're keeping their personnel and they're keeping them busy. And they're going to continue to drill and how they manage that budget. I guess we'll see come Q1. But we're not seeing any slowdown at all. I mean, we're extremely busy right now. We had a little bit of a breather, first part of October. It seemed like people were trying to catch up -- our customers were trying to catch up and we were like, hey, what's going on. And they've assured us that there's no slowdown on their end. And now we're starting to see that in our facility. We're very busy with new products and also repaired products. And they're asking us to do more and more. And that's very nice to see this time of year.

[JohnBair:]

So it sounds sort of like, because of the labor issues, we can't really ramp up rig count as fast as maybe they might want to, which is no big surprise, sounds like they're drilling budget dollars are going farther because of the efficiencies of using your tool. So therefore, maybe they're looking ahead into the first quarter of 2022. And saying, hey, we want to get these tools lined up, that we be able to use in activities is that kind of a way to look at it?

[Troy Meier:]

It is a way to look at it. And I think, again, if you look at over the last 10 years, and the step changes that we've made in drilling tools and drilling practices, where we are able to take days and weeks off of wells, by changing things or offering new tools. That is now those efficiency gains are now much smaller. So they're able to forecast a budget now, I think when they forecasted their drilling budgets in 2021, they were a lot more precise at knowing what they needed to drill this. And there wasn't those big efficiency gains that they've seen in years past, their drilling super-efficient right now. But I think, they've captured all those big gains. And it's to the point now, where they're pretty much drilling as fast as you can connect pipe. And so I don't know, I just think you haven't seen the big efficiency gains throughout this year that are going to say, oh, every well, we're now taking a week off. Which means by the time we get to, October, November, December, we've drilled that, -- we've drilled our budget up. So I think that yeah, so I think that's what we're seeing.

[JohnBair:]

Okay. And I'm wondering, are any of your products or any materials that you're manufacturing? Is there any capability or thought of utilizing 3D printing to manufacture some of your stuff? And then the last one would be any ability to raise prices for some of your products? And then I'll -- that's it for me. Thanks.

[Troy Meier:]

So 3D printing, we've looked at that, when we look at the most of what we do is, are very large parts. And so, to get that into a 3D printing realm, they're just not there yet, small complicated stuff that's tough to machine. 3D printing works very well. Stuff that's 10 feet long and weighs 3500 pounds not so much. So, we do look at 3D printing. We've got a very talented, group of, I don't like to call them machinists, I don't want to call them technicians. There are a lot more than that. Everyone we have in our manufacturing facility, they design. They run the CAD. They run the cam. They run all the post processors that they created. These guys are very unique challenge a group of people and when they see something like that, but they think that we can make better on a 3D printer. They bring it to our attention right now. But at this point in time, we haven't been able to justify the 3D printing process. But we continue to look at it. Sorry, what was your second question?

[JohnBair:]

The second one was just any ability, given the demand and cost of raw materials and so forth? Any ability to raise prices on any or of your services or the products?

[Tory Meier:]

Yes. I think what you're going to see is throughout the industry is going to be in 2022. The ability for the service companies to increase their prices. I think the E&Ps are all preparing themselves for it. It has to happen. I mean, when you look at still alone, since March, there has been five price hikes on steel, just since March. And we're working on a-- looking at turnkey in a process for a very large company. And when we got evaluating this and what we could do it for and what their expectations were for us to do it for. We were way off their mark. And when we realize that, what they were going off of were still prices that were, you know, nine months old, we said no, you guys got to do, you've got to research, you're still price as much better now because they've gone up a lot since then. So it's gone up so fast that that even the people that are looking to have a start turnkey and product lines, they need to understand the cost within their organizations much better because it's rising so rapidly. We've done a good job. We've identified processes, one of the things that we did that I'm super excited for is, we typically would get a big round bar stock of steel, when we make the Drill-n-Ream tools, and then we've got to do a lot of machining to get the near net shape that we you know, finalize and start milling all the cutter locations into that. And we've been able to identify forgings, now we're able to -- these large tools, we're able to get them into our process. Matter of fact, the first ones are supposed to show up next week, saving us all kinds of time. And so we're buying the steel, by the way, but we don't have to spend all of that time. And when you look at a drilling tool, you're turning about 55% to 65% of that bar stock is turned into scrap chips. And we're able to eliminate that time and the money that it takes to buy that bar, we're able to really efficiently get what we need in our door and spend a lot less time machining it. We're excited to see how that benefits the company. I think it's going to benefit us greatly.

[Operator:]

Our next question comes from line of John Sturgis with Oppenheimer and Company.

[John Sturgis:]

I'm just curious, I didn't see an R&D line in the press release. And I was just curious and new, you probably didn't do a lot in the past 18 months. But just curious. Is that area picking up for you doing your own?

[Troy Meier:]

No. We still intend on getting our R&D going. We've got that Strider tool that we've talked about for years, that's so close, and we've got it, the coil tubing Striders it's a product that we're looking forward to getting out there. But John, the biggest issue that we have right now is, we've had to totally take our R&D team and put them into our manufacturing to support what we've got going on there up until we get individuals trained. We've got some great things that we're looking to still do with R&D, we've got a list of products, we think that the oilfield could very much use. We have bought some power sections for metal-on-metal power sections, which is going to really be that step change in technology for downhole motor performance, and we brought those units in and we're ready to do some modifications on those units to plug them into our Strider tool to take that to where it's -- that tool can generate a lot higher margins. We've just been short-handed and are the guys in R&D, even though it's a skeleton crew, they're top notch and we need them right now to support the demand on our on our manufacturing. We've got things as we look at becoming more efficient, right as we're doing more and more repairs all the time. We've got to find ways to do it much better. So just because we don't have that guy in R&D looking at finishing that Strider. He's actually right now we've got a team in the building a sandblasting systems within our operations in Bernal to make that much more efficient. So the trip traditional, bring them in and parts, wash them and put them into a media blaster, it’s totally changing with, we've got two rooms constructed, or building the railing system in those rooms. So that when these trucks come in with these heavy long tools, we manage him with this railing system, we bring them in, we do the media blast much more efficiently. And we eliminate the whole part swashing section of that procedure. So the R&D group is busy just supporting, making us more efficient, but also supporting making sure that we're getting the tools out that our customers are demanding, we get out. But we'll get back into R&D, I would imagine it's going to be some time looking at second quarter 2022. I'm really hoping by then we've staffed up and we've trained well enough that we can pull a couple of these individuals back in and finish up that that Strider product line and then get on to the next one.

[Operator:]

Thank you, ladies and gentlemen, that concludes our question-and-answer session. I'll turn the floor back to Mr. Meier for any final comments.

[Mike Meier:]

I just want to say thanks everyone for taking the time to join us today. And we're excited about what's going on. And we're excited what 2022 is going to bring and I look forward to visiting with everybody. In March, I think we've got a good runway ahead of us. So with that being said, thank you very much and appreciate you all attending. Have a wonderful weekend.

[Operator:]

Thank you This concludes today's conference. You may disconnect your lines at this time. Thank you for your participation.