Digital Turbine, Inc. (APPS) Q3 2019 Earnings Report, Transcript and Summary

Good day. And welcome to the Digital Turbine Fiscal 2019 Third Quarter Results Conference Call. All participants will be in listen-only mode [Operator Instructions]. After today's presentation, there will be an opportunity to ask questions [Operator Instructions]. Please note this event is being recorded. I would now like to turn the conference over to Brian Bartholomew, Senior Vice President, Capital Markets and Strategy. Please go ahead.

Thank you, Nicole. Good afternoon and welcome to the Digital Turbine third quarter fiscal 2019 earnings conference call. Joining me on the call today to discuss our results are Bill Stone, CEO and Barrett Garrison, our CFO. Before we get started, I would like to take this opportunity to remind you that our remarks today will include forward-looking statements. These forward-looking statements are based on our current assumptions, expectations and beliefs, including projected operating metrics, future products and services, anticipated market demand and other forward-looking topics. Although, we believe that our assumptions are reasonable, they are not guarantees of future performance and some will inevitably prove to be incorrect. Except as required by law, we undertake no obligation to update any forward-looking statements. For a discussion of the risk factors that could cause our actual results to differ materially from those contemplated by our forward-looking statements, please refer to the documents we file with the Securities and Exchange Commission. Also, during this call, we will discuss certain non-GAAP measures of our performance. Non-GAAP measures are not substitutes for GAAP measures. Please refer to today's press release for important information about the limitations of using non-GAAP measures, as well as reconciliations of these non-GAAP financial results to the most comparable GAAP measures. Now I will turn the call over to Mr. Bill Stone.

Thanks, Brian. And thank you all for joining our call today. Our stated goal has been to build and sustain a profitable growth business. We had a very strong December quarter as the company set all-time records in revenue, gross profit, EBITDA, Non-GAAP net income, device installs, and revenue per device or RPD on a continued operations basis. And as pleased as I am with the business continuing to set these record milestones, I'm more excited about the opportunities for growth we're seeing in the strategic value of the platform and how we've positioned ourselves for the future. I'm going to break out my prepared remarks into three areas. First, I'll provide some commentary to close out the December quarter. Second, I'll provide some real-time operational updates, and finally align with some commentary about the strategic value of the platform and how we are positioned for 2019 and beyond. We finished the December quarter with $30.4 million in revenue which represent 34% growth compared to December quarter last year. Our Non-GAAP gross margin which has been an area of focus for us improved to 37% in the quarter which was an improvement of more than 240 basis points year-over-year. The resultant 43% growth in gross profit along with disciplined cost management enabled us to generate a record $3.8 million in adjusted EBITDA and approximately $2 million in free cash flow for the quarter showcasing the strong operating leverage of our business. Barrett will provide more specifics on financials, but from an operational perspective I was very pleased with our revenue per device performance or RPD which was driven by strong advertiser demand, increased by configurations of some partners, and incremental contribution from newer products. And as many of you have heard me say, countless times RPD is a fundamental health metric of our business. And in December quarter, our collective revenue with our three largest north American partners grew by 22% compared to the same period last year despite their total related device unit sales being 14% lower. And this was all due to a 42% lift in RPD, as our global media team did a fantastic job executing in the December quarter. I'm also pleased with our growing revenue and gross margin diversification which was aided in the quarter by stepped-up international growth, as well as the launch of a new partner here in United States. In particular is worth noting that our international revenues were up approximately 100% percent year-over-year. Including a tripling of revenues with our largest Latin American partner compared to the December quarter last year. These results all showcase the improving diversification of our partner base as a percentage of gross profits coming from places other than our three largest US partners grew from 20% a year ago to 32% in the December quarter. And now, turning to forward outlook. I want to provide some commentary on how we are positioned for growth across each of our three growth levers. Devices, media demand and new products. First on devices, I know there's been a lot in negative press surrounding slowing smartphone replacement rates here in the US and other mature smartphone markets driven by disappointing recent results from some high-profile smartphone manufacturers. And while our business model is certainly sensitive to the overall smartphone market, we are not at all fully dependent on it at the current time. For one thing we're still largely a penetration story and that even with an annualized install rate of greater than 100 million devices, we are still on fewer than 10% of the android smartphones sold globally today. We are however, continuing to add key strategic partners to the platform to meaningfully grow this penetration figure in future quarters particularly on the international front. For example, we're now live and generating revenue with many new partners such as Track Phone, Panasonic, Karbonn, Intex and others, they were not active partners last year. Obviously our recently announced partnership with Samsung is another extremely promising opportunity for us to significantly expand our global footprint and I'll address our Samsung partnership in further detail here shortly. Before I leave the discussion on devices, I want to note a few possible positive catalyst for devices in 2019. The most significant of which is the imminent arrival of 5G here in the United States. As we've witnessed with previous network upgrades, we anticipate some incremental demand as smartphone users look to take advantage of the benefits of 5G. And it's been publicly reported it is anticipated that 5G for 2019 will be exclusively on android with no apple 5G devices expected in the next 12 plus months. I also want to repeat again that we continue to assess opportunities to extend our platform onto new device types beyond smartphones such as televisions which would also foster incremental grow. And now I shift to the other key drivers of our business. The main factor that enabled us to more than offset weaker underlying smartphone demand in 2018 is a higher advertising yield per device which leads to a discussion of media demand and new products. And as I mentioned earlier, we are generating substantially higher RPD that has enabled us to grow with our key partners even when device units are down. This explosive RPD growth reflects increased demand for same-store slots from advertisers as well as incremental contributions from newer products such as Single Tap and Smart Folders is a testament to the value-add that we are providing to our advertising clients. As well as tour operator and OEM partners. And on the media side, we continue to grow RPD as we expand our media relationships. Digital Turbine is the number three distributor of android applications in United States trailing only Facebook and Google. And I have been pleased with the increasing diversification of the types of applications we're delivering. And while we're seeing growth in aggregate gaming revenues, as a percentage of total revenues we are seeing much faster revenue growth from brands and other non-gaming applications such as Linkedin, Starbucks, eBay, Yelp, and many others. Brand revenue is now comprised more than 50% of our overall advertiser demand. I also want to call out here that we're starting to see noticeable results from our revenue share arrangements with select advertising partners including Netflix, Yahoo, Amazon, The Weather Channel and others are anxious to utilize our platform to scale not only their US user bases but are increasingly looking to our international footprints as an effective means to grow their international users. These revenue share arrangements and some of our other lifecycle products now constitute approximately 5% of our total revenue and a yield to stream of revenue over the entire life of the device and as such are insensitive to the varying length of smartphone replacement cycles. On the new product front, while our Single Tap revenues outside of our social media partner and large US operator integration are not yet material, I am pleased that we are now live with Single Tap on more than 130 million devices worldwide including 50 million here in United States. It's taken us a lot longer time to get to that scale than we anticipated but now that we're here has made signing up demand partners far easier. Onboarding new demand partners such as Twitter, The Weather Channel, Yelp and others is the top priority of the Single Tap team and although the conversion rates continue to perform well with improvements anywhere from 30% to 200% higher compared to non-Single Tap or a traditional flow through the Google play store. The partners need to see those device volumes to justify the investment of resources on their side. That's now happening and is largely an operational and distribution demand exercise from this point forward to scale. We also continue to launch more products across more partners including our wizard out of the box experience, Post Install notifications and Smart Folders just to name a few. We're also pleased with the growth tied to our open market and recycle device initiatives that mitigates some of the negative impact of declining new device sales with some operators. 2019 will be about continuing to scale these new products while also launching our bring-your-own-device or BYOD product to the market. Currently operators don't have a good solution to deliver their branded experiences to their customers when a device is not directly sold by them. In most of the world this is how devices are distributed, so it's a pain point for them. And as we grow our device base into the hundreds of millions being able to deliver a customized out of the box experience for operator subscribers is a tremendous market opportunity. Another attractive opportunity for us will be leveraging our distribution footprint and expanded product set to help our products distribute and promote their considerable in-house media content and we look forward to sharing more with our investors on this front on future calls. I know I spent a few minutes on Samsung. As you recall, we signed a multi-year agreement with Samsung. The world's largest smartphone OEM back in November to meaningfully expand our geographic reach and to better exploit the open market and global mobile operator opportunity worldwide. I've been extremely pleased with the first few months of our partnership as we are working hand-in-hand with Samsung to carefully formulate specific go-to-market global strategies spanning across multiple continents. Samsung is already a highly valued and supportive partner of ours. And one of the key lessons I've learned in this business is that internal partner sponsorship for platform offerings is a key driver of success and our internal sponsorship with Samsung has been great. Our Samsung relationship is also helping us in a number of international operator accounts which historically been blocked and now going forward. Our technical integration with Samsung knocks down a key hurdle we've been facing historically with those international operators. We expect that our partnership with Samsung will begin to generate incremental revenue for Digital Turbine over the next few months and very much look forward to updating you our steady progress going forward. And finally, before I turn over to Barrett, I will conclude my comments that the past December quarter set many all-time first for us. And our future growth levers of devices, media, and new products are all coming together to drive continued profitable growth into 2019. With that, this concludes my prepared remarks and I'll turn it over to Barrett to take you through the numbers.

Thanks, Bill and good afternoon everyone. As bill mentioned, we're very pleased with the results in the quarter. Delivering 34% revenue growth, sustainable and expanding profitability with adjusted EBITDA of $3.8 million and non-GAAP net income of $3 million enabling positive free cash flow generation of $2 million in the quarter. As a reminder, the results of our divested businesses are treated as discontinued operations for all periods presented in our financial. My comments today will refer to results on continuing operations unless otherwise noted. Also, all of our comparisons are on a year-over-year basis unless otherwise noted. Revenue of $30.4 million in the quarter grew at 34%. We continue to experience impressive growth from both our legacy partners plus as Bill highlighted, contributions from new partner is not yet live on the platform this time last year are driving a notable growth in the quarter. Positive trends in RPD yields continue across all regions with our US market delivering record levels well above $2 RPDs and expanding more than 40% over prior year. Turning to gross profit and margins. Revenue growth and expanded margins enable non-GAAP gross profit dollars to increase by $3.4 million year-over-year to $11.2 million in the quarter. Non-GAAP margin was 37% in Q3 expanding sequentially from 34% in Q2 of this year and up from 34% in Q3 of the prior year. Our margin expansion is largely driven by faster than expected diversification towards higher margin partners and continued impressive growth within our open market channel in the quarter. I'm especially pleased with the margin composition of the new revenues coming on to the platform with the gross margins greater than 44% on the incremental revenue is generated in the quarter. As I noted previously, our gross margin rates can be sensitive to changes in partner mix and revenue type which can fluctuate from quarter-to-quarter. We continue to be encouraged about our opportunity to expand margins overall as demonstrated by our recent performance. And given our current and expected revenue mix trends, we would anticipate margins at or slightly positive to Q3 levels over the near term. We continue to be pleased with the impressive expense scale in the platform. Total operating expenses were $8.2 million compared to $8.9 million in the prior year quarter. Cash expenses in the quarter were $7.4 million compared to $7.8 million in the prior year quarter or a decline of 5% while revenues grew at a rate of 34%. These results continue to highlight the inherent operating leverage in the business. I would note while we're not providing quarterly expense guidance, we expect to continue to make focused investments to support the new partners and products launching on our platform and we'll continue our seasonal marketing investment in Mobile World Congress in February. During Q3 adjusted EBITDA was $3.8 million up from breakeven levels in Q3 of last year and representing EBITDA margin of approximately 12%. This resulted in a marginal EBITDA conversion rate of almost 50% on incremental revenues year-on-year. This further emphasizes the embedded operating leverage in our business. Non-GAAP adjusted net income in the quarter was $3 million from continuing operations or a profit of $0.04 per share as compared to a net loss of $0.8 million or $0.01 loss per share in the third quarter of 2018. Our GAAP net loss in Canadian continuing operations for Q3 was $1.1 million or $0.01 per share loss based on 77.6 million weighted shares outstanding compared to our third quarter of 2018 net loss of $4.8 million or $0.07 per share. Included in our GAAP net income for the quarter is a recorded loss of $3.1 million from the impact of the change in fair value of derivative liabilities resulting from our convertible note, which is highly sensitive to the company's stock price. As a reminder the derivative liabilities on our balance sheet will fluctuate as our stock price moves and may have a material impact on our reported GAAP financial. Moving to the balance sheet, we've finished the quarter with $10.1 million in cash and generated $2 million in positive free cash flow from continuing operations in the quarter up from negative free cash flow $0.8 million in Q3 of last year. I'm also pleased with the results of our working capital position which improved $2.7 million sequentially. We had a small reduction in our debt levels in the quarter as there were about $200,000 in conversions on our convertible notes during the quarter and the gross principal amount of our regional $16 million notes ended at $4.7 million at quarter end. We had an additional $3 million in conversions on these notes since the end of the December quarter bringing our current balance at today's date down to approximately $1.7 million. It's worth highlighting that as we compare our balance sheet now, the levels at the same time last year there have been significant progress across all health metrics including working capital levels, more than $4 million reduction in debt levels and an increase of over $3 million in our cash balance further underscoring the continued progress as we focus to bolster our balance sheet. With the combination of our growth and free cash flows and a vastly strength in balanced sheet, I'm very pleased with the company's financial profile at this stage and excited about our position to execute on both our near-term operational plans and our broader strategic growth objectives. Before I turn to our business outlook, I wanted to provide an update related to the SEC matter tied to internal controls. As disclosed in our 10-Q this matter has been finalized and settled with the SEC, the company is appreciative to have this matter closed and as a reminder the company is always stock -- internal controls environment will continue to be an imperative and integral part of the company. Now let me turn to our outlook. We currently expect full year of fiscal 2019 revenue to grow between $102.5 million and $103.5 million and expect full year adjusted EBITDA to grow to between $7.3 million and $7.8 million. With that let me hand it back to the operator to open the call for questions. Operator?

Thank you [Operator Instructions]. Our first question comes from Mike Malouf of Craig Hallum. Please go ahead.

Great. Thanks for taking my questions and nice to see an update relative to at least my expectations, so well done. If I could start off on just a little bit on the ex-dynamic installed on that revenue portion. Can you break that out a little bit more for us and just give us a little bit more color on what's going on there? It sounds like Single Tap is starting to ramp and you have open market, but a little bit of color there and particularly on the gross margin within that ex-dynamic install section?

Yes, sure Mike. This is Bill. Yes, so we saw a number of things in the quarter. First is we saw improvements in advertiser demand and advertisers willing to pay higher rate. So, our revenue per slot went up, which is clearly a positive. Secondly, with some partners we saw increase slot configurations for the holidays, which I tend to like to do and that's obviously an incremental revenue driver for the business as well. And then finally, we saw contribution of new products. So, you'll start to see contributions from things like Single Tap, things like our Smart Folders, our notifications et cetera that a year ago in the December quarter were basically either zero or negligible. So those are kind of the three drivers that drove the increased revenue and then diversification of the partner mix is really what helped accrete the gross margin. So, we're starting to see the international growth, the open market growth the recycled devices growth. All be contributors there to our numbers, and then also contributing to that is more of the recurring revenues as we do some of these rev share agreements. So, in other words devices that may have been sold many many months ago you're continuing to drive revenue force because our revenue share basis. So, those are really your drivers that help have us be on the top-line and some material improvements in terms of gross profit.

Okay, great. That's helpful and then as you look out into the rest of the calendar year specifically on addressing new carrier partners do you think they're going to come mostly from the Samsung relationship, or we actually have some that are may be in the pipeline that are outside that relationship?

Yes. So, I think what you'll see from us is really two-fold. You are going to see new partners that will be new OEM partners that currently we haven't announced yet. So, that's independent of the Samsung relationship. And then secondly on the operator side, I think what you'll see if now that the majority of those operator device sales especially in overseas markets are Samsung and we're integrated with them. That knocks a big hurdle down for us. Now for the other OEM relationships, whether those are manufacturers like Sony or LG or Huawei or whoever happens to be. We will go with our standard solution and not the Samsung one. So, from an operator perspective, they can now just do business with Digital Turbine and cover their entire device line-up where historically Samsung had been blocking them and now that we've integrated with Samsung that's no longer a blocker. So, that's something we've got a lot of optimism about right now especially as it relates to operators in Europe and Latin America.

Okay. Great. Thanks a lot for the help.

Our next question comes from Darren Aftahi of ROTH Capital Partners. Please go ahead.

Hi guys, good afternoon and thanks for taking my questions and congratulations on the quarter. Just a couple if I may. You referenced, I guess partner in your prepared remarks and I guess and then in the PR. If you kind of indulge us perhaps what kind of partner that is? My second question is Bill to your comments about the recurring piece of your business, I know you said it was 5%. How much of that derivation is coming from domestic base operations for those businesses versus international and then how does the pipeline for those existing current customers look and new customers and then I've got a follow-up on [ph].

Yes, so apologies Darren. The first part of your question you said partners. I'm not sure, I was following you. Could you provide a little more color there?

I think you had referenced a new partner not plural, I'm just curious.

Okay. Yes, that was Track Phone.

Got it. Okay. Great.

Yes, and then as far as the recurring revenues go. This is a big deal. This is something that we've been focused on as a company as we started to see life over the entire -- in of the entire device – a customer holds a device versus just out of the box. And so, now what we're seeing is a year ago that was new and now it's roughly 5% of our revenues. The vast majority of it, but not all of that is here in the United States but I'd say that probably north of 80% of it but not north of 95% just to give you a range. But we're seeing that growth becoming more material for our business and that's something that we put a focused effort on over the past 12 months and is starting to bear fruit for us. And as we start to see more and more open market devices, and by open market devices I'm meaning a device that may have ignite on it with a certain operator and then it gets shipped overseas or gets put on to another operator. Those things get recycled through the system. Those recurring revenue streams more more material for us. So, that's something we are excited about and also drives accretive gross margins for the business and somewhat insulates us from any potential macro headwind that go from device slowdown.

Great. Just two more if I may. I think in the past you guys have kind of broken out growth in the dynamic install business, the preload and then kind of new products and I'm curious what those respective growth rates were in revenue composition? And then at CES there was a pretty big push for Android as an operating system on TVs and I know you hinted expansion of the platform beyond handset. I mean how real of an opportunity that is something that's months away, years away, or something there is something that's kind of more near term for Digital Turbine? Thanks.

Yes sure. So, first I'll take the TV's one and I'll turn it over to Barrett in terms of some of the product revenue break ups. As far as TV's, we're seeing a lot of inbound interest right now. And I think that we're going to start seeing a lot more competition for entrenched Cable and pay TV providers and what that comes from 5G or other over the top solutions in Android televisions, it's something that has a tremendous amount of energy in the marketplace right now. But I think in terms of how all of those applications and how all that content is going to be distributed and moved around between the device and the television within the television and so on, we've received a lot of interest and how we can add some value there, since it really is just in effect an android stick with HDMI into a very big screen. So, I don't see it as something that will show up in a March or June quarter results. But I do see it as something that is strategic to us and complimentary and can further deepen our relationships with our existing partners that are very much looking at the space. And as far as product, Barrett can you take that?

Yes, Darren to your around the non-dynamic install performance we've seen a lot of success and those new products revenue levels have been basically on pace with Q2, Q3 to Q2 similar pace of revenues which are up considerable year-on-year where we had very little of those products in the market Q3 at this time last year.

Thanks.

Our next question comes from Sameet Sinha of B. Riley FBR. Please go ahead.

Yes. Thank you. Couple of questions, Bill I guess since RPD is the strong driver of growth can you talk to us where do you see a ceiling what kind of sort of RPD could eventually you could get to based on your portfolio that you have right now? Secondly, just on Single Tap you said of course as number of devices is up pretty significantly could you mention operation and distribution demand exercise there. Can you elaborate on that a little bit and talk about how this could work and who some of the players in the ecosystem are? And lastly, just looking at fourth quarter review guide and given kind of in-line despite third quarter be it this full 12% sequential decline steeper than we had anticipated and probably what have been historically. So, if you could just kind of talk to us qualitatively about what sort of assumptions are you making that we have? Thank you.

Sure. Yes, I'll take the RPD and Single Tap question and I'll turn it over to Barrett for the fourth quarter guide. As far as the ceiling on RPD goes, if you look at where we were a year ago and where we are today, and you will say we are up over 40% year-over-year. That was really driven by three things, it was driven by growth in new products that didn't exist, so purely incremental, it was driven by improved advertiser demand and it was driven by more slots with certain operators. I do think that the slot configuration does have diminishing returns on it, but the other two I see a tremendous ceiling for. And so, it's very much our expectation that we'll continue to see our revenue per device accrete as we look at that I'll call the same-store sales type of basis as the specialty since new products take hold. So that's very much a focus area for us, so I don't think we're near hitting the ceiling of what the opportunities that is for us. However, I will caveat that with as we add more and more international devices, the global RPD may go down as you see more contribution from international devices but that doesn't mean that the RPD will be on a kind of same store sales basis with partners here in the US will go down. We see that continuing to go up. And far as Single Tap goes, yes, I think we had a chicken or egg problem whereas the demand partners and some of which I've referenced in my prepared remarks, really wanted to see scale of devices and then the people that want to put up software on the devices, the operator is new [ph] want to see the demand partner. So, we finally work through that it so long than we would have liked and now that we're starting to see the revenues continuing to ramp week-over-week which is great. But in order to get to material nature, we got a really scale in terms of how we can add more sales people, more integration, more operational integrations and there is just some blocking and tap on if you will that just got to occur to make that happen. The good news though is that the fundamental premise of Single Tap is that conversion rates are going to improve versus the traditional Google Play and what we're seeing right now is Single Tap continues to be encouraging as the conversion rates continue to look really good anywhere from 30% to 200% better. So, it's going to be a major focus area for us to continue to invest resources here to start making it as more material but what our premise was with it is off to a good start. So let me now turn it over to Barrett for the guide.

So, your question around the guidance we offered in Q4, so the midpoint of our guide would have revenues for the year just under 40% around 38% and revenue growth for the quarter close to 27%. One thing to note is we're lapping AT&T and kind of they are gaining the material scale this time last year and that's one factor we contemplated, the softness in devices we contemplated there's a lot of excitement around the new launch of the Samsung, but I think until we see it perform and that product perform well. We have pretty pleased with 27% revenue growth in the quarter. In here in our guide, but there's not any headwinds that you might be unaware of in the quarter.

Okay. Thank you.

Our next question comes from Jon Hickman of Ladenburg Thalman. Please go ahead.

Hi Bill, thanks for taking my questions and congrats on the quarter. So, I just have one, it sounds like from the international business and you mentioned that one of your partner is actually international partners was up like double-digit. Can you talk about American Mobile is that things doing better there?

Yes, sure. So, yes American Mobile is really delivering much improved results from where you've seen it from prior quarters and that's really driven by two main factors the first is we've done a better job on our side improving our demand and improving our relationships in the region to bring additional advertisers and bring better rates to the table. And then we've also implemented some technical improvements. There's been a long time in flight that really improve the delivery of the platform American Mobile uses a different way to deliver applications than some of our, actually all of our other partners do. And so, we had a variety of technical work to do between American Mobile and ourselves and that went into production and as a result was able to deliver improved results. So, it's a partnership we continue to be enthusiastic about and I think combined with some of our other partner announcement things in the pipeline we're very bullish on Latin America as we go into 2019.

Okay. And just one more were there any like just positive surprises in the quarter that you weren't really anticipating that kind of helped things out?

Yes. I don't think there was any one single thing. I think it's just fine for us and it was something in the December quarter and it's a theme for us and we're going to 2019 is just diversification. We're just starting to see our existing partners continue to perform and continue to grow which is fantastic but they're starting to become a lower percentage of the overall story, dynamic install is becoming a lowering percentage of the overall story. So, I think the diversification was on the quarter from a variety of new partners, a variety of products and so on is really something that's starting to show up in the results now whether that's top-line or expanded gross margins or better operating leverage on the platform. Those are starting to start things that give us a lot of excitement going into this year.

And Barrett, what are you going to do with all the cash we're generating?

So, it's a nice problem to have. We like the outlook. We like the fact that we're generating free cash flow and it's becoming a theme, so it's been nice.

Okay. Thanks appreciate it.

Our next question comes from Ilya Grozovsky of National Securities. Please go ahead.

Thanks guys. Just wanted to follow-up and get an actual number. The new product, what percentage of revenues were they in the quarter?

They were just above 12% in the quarter.

Okay. And the international revenues as a percentage of the overall piece. What was that?

Our domestic business was in the mid-80. So, international would have been close to 15%.

Okay. Super. Thanks guys. That's it for me.

Thanks.

This concludes our question-and-answer session. I would like to turn the conference back over to Bill Stone for any closing remarks.

Yes. Thanks everyone for joining the call today. We look forward to reporting on our progress against all the points that we made on today's call. And we'll talk to you again on our fiscal fourth quarter call. Thanks, and have a great night.

The conference is now concluded. Thank you for attending today's presentation. You may now disconnect.