ArrowMark Financial Corp. (BANX) Q4 2018 Earnings Report, Transcript and Summary

Welcome to the StoneCastle’s Financial Corp. Fourth Quarter 2018 Investor Conference Call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. [Operator Instructions] Please note, this conference is being recorded. Now I would like to turn the call over to Rachel Schatten, General Counsel of StoneCastle’s Financial.

Good afternoon. Before we begin this conference call, I'd like to remind everyone that certain statements made during the call may be considered forward-looking statements based on current management expectations that involve substantial risks and uncertainties. Actual results may differ materially from the results stated in or implied by these forward-looking statements. This would depend on numerous factors, such as changes in securities or financial markets or general economic conditions; the volume of sales and purchases of shares of common stock; the continuation of investment advisory, administrative and service contracts; and other risks discussed from time-to-time in the company's filings with the SEC, including annual and semi-annual reports of the company. StoneCastle’s Financial has based the forward-looking statements included in this presentation on information available to us as of December 31, 2018. The company undertakes no duty to update any forward-looking statement made herein. All forward-looking statements speak only as of today, February 28 2019. Now, I will turn the call over to StoneCastle’s Financials Chairman and Chief Executive Officer, Josh Siegel.

Thank you, Rachel. Good afternoon, and welcome to StoneCastle’s Financials fourth quarter 2018 investor call. In addition to Rachel, joining me today is George Shilowitz, President; and Pat Farrell, our Chief Financial Officer. I would like to start the call today with a review of StoneCastle’s Financials quarterly results, with brief comments and the market environment, as well as updates on the company. Then I will turn the call over to Pat, who will provide you with greater detail on our financial results, before I open up the call for questions. Net investment income for the quarter was $2.7 million or $0.42 per share. Total assets were approximately $196.2 million, and the value of the invested portfolio was approximately $189.1 million. The net asset value at the end of the quarter was $21.43, down $0.61 from the prior quarter. This decline was predominantly due to unrealized depreciation in the quarter decreasing by $3.4 million or $0.51 per share. We believe no meaningful credit issues currently exist within the portfolio, and the majority of the underlying banks continued to be scored investment grade by Kroll Bond Rating Agency. Now let me turn to the portfolio review. This was another quiet quarter within the community banking industry. As published by SNL, there were 10 reported sub-debt deals closed during the quarter, raising under – just under $500 billion of capital with coupons ranging from 5.9% to 7%, with a weighted average coupon of 6.1%, one [ph] $300 million issuance with a coupon of 5.9% accounted for approximately 60% of this total. These statistics put in perspective the strength of StoneCastle’s ability to originate bespoke investment opportunities even in slow and/or volatile markets. During Q4 StoneCastle’s management was able to originate a unique investment in a secured loan issued by Young Partners with a Yield to Maturity of 10.5%. Young Partners is a holding company of Citizens Bancshares Company of Kansas City, Missouri which owns Citizens Bank and Trust Company. Another transaction in the quarter was a small investment in Valley Bancshares, a fixed term loan with a coupon rate of 6.375%. Working with an institutional investor we were able to utilize a version of the pooled investment structure we used previously. As a result StoneCastle was able to structure an attractive investment resulting in an effective yield closer to 9.6%. We believe our ability to execute this type of transaction will open up new opportunities going forward. These types of transactions in a relatively quiet market have resulted in the company maintaining a strong portfolio of yields. At the end of the quarter, the portfolio's estimated annualized current yield of 9.32%, is a continued testament to shareholder value created by the company. The estimated yield is subject to fluctuations as the mix of portfolio investments and their values will change, but it has been consistently above 9% in eight of the last 10 reported quarters. I just want to remind our shareholders that StoneCastle benefits from the range of investments the company generally pursues within a bank's capital structure. Our scheduled investments is predominantly a fixed income portfolio with any public common equity vehicle, as the company typically invests in securities that rank senior to bank equity. And such, a little understood aspect of the portfolio construction is that a bank common equity insulates StoneCastle’s income stream by absorbing the economic impact of credit and/or other losses sustained by an individual bank before affecting the company's more senior security. The quarter end scheduled investments can be found in the company's SEC filings and on the company's website. Now let me make some comments on the general landscape of banking and the investment environment going into 2019. As I pointed out last quarter, the market remains slow, with bank demand for capital below historic norms due to the high equity capitalization within the banking industry and tepid economic growth. Variables will be the Federal Reserve's continued unwinding of its balance sheet, their outlook and decisions on interest rates, as well as the overall growth of the economy. As the interest rate environment continues in transition, we believe the best course of action is that of patient capital and prudently utilizing our line of credit for additional asset growth. Therefore we continue to focus on credit quality as a priority in the portfolio. The yield on new issues subordinated debt issued by community banks compress significantly over the past several years and we believe this has been largely driven by the reduction in issuance, as well as the market's perception of the improved credit quality of banks. For these reasons we believe the community banks need for capital will continue to be relatively low in the immediate future. Although there may be a cyclical decline in demand for capital, we believe the multi-trillion dollar community bank sector is ripe kph with opportunity for us, as we survey a broad landscape of bank and banking related investments. We believe the company is well positioned to participate in expanded opportunities consistent with our investment objectives. StoneCastle's reputation in the market and its industry expertise allows us unique reach into community banks and banking related companies. We have proprietary and early knowledge of front, mid and back office services available to automate and digitize banks, along with the opportunity to understand the trends and adoption rates of these banking related businesses. An example of this is technology and its impact on consumer behavior. Banks are seeing the first generation of customers who can't remember a time before the Internet or digital banking. In general, we believe that the impact of technology will be favorable for community banks and many other companies will continue to grow rapidly to service this multi-trillion dollar industry. Banks are increasingly developing digital solutions for their customers and streamlining operations to reduce non-interest expenses. Another example of banking related services are specialized companies performing time consuming administrative functions, such as Know-Your-Customer, OFAC and third party risk assessments for example. Banks are outsourcing these functions in increased regularity to emerging service companies, many of which directly offer us opportunities to invest. The vast majority of banks in the U.S. or besides that allow for cost efficient outsource technology solutions and a number of companies has emerged to serve the needs of these approximately 5400 banks. We are not willing to sacrifice credit quality and chase yield, if we can find more attractive risk return profiles elsewhere in the banking related scope of opportunities we prefer to focus on those alternatives. Banking has historically been profitable and most banks at their core are lenders, providing commercial and/or consumer credit. As such we believe that bank performance is highly correlated with a credit performance of these underlying assets, a term we call Community Risk. The current lack of demand for capital by bank is creating compressed spreads and therefore we are seeking to increase our exposure to other bank related credit products and bank related services and software businesses. We believe that the inclusion of such investments complement our overall strategy and enhance the diversity of our holdings. Let me conclude my remarks by commenting on StoneCastle as an investment. Given the current market volatility and uncertain macro environment, I want to emphasize that an investment in StoneCastle Financial is a pure domestic play on local market economies across the United States. With approximately 60% of our dollar weighted to underlying bank investments in the heartland of the country, banks offers a strong, geographical diversification across 34 states. StoneCastle targets investments in small community banks, the majority of which have less than 1 billion in assets. These banks for the most part serve their local markets, which is a differentiating factor for regional and money center banks. Finally, we continue to believe that an investment in StoneCastle Financial affords shareholders a great opportunity for capital preservation relative to the market. Now I want to turn the call over to Pat to discuss the financial results and provide details on the underlying value of the company.

Thank you, Josh. As I do each quarter, I will present the financials by going through the detailed components to help you understand the value of the company. The net asset value at December 31 was $21.43, down $0.61 from the prior quarter. The NAV is comprised of 4 components: net investment income; realized capital gains and losses; a change in value of the portfolio's investments; and finally, distributions paid during the period. Let’s walk through these components. Gross income for the quarter was $4.7 million or $0.72 per share. Net operating expenses for the quarter were $1.9 million or $0.30 per share. Net investment income for the quarter was $2.8 million or $0.42 per share. The second component affecting the change in NAV for the quarter is realized capital gains and losses. The net realized capital loss for the quarter was nominal at just under $7,000. The third component, changes in unrealized appreciation or depreciation of the portfolio, relates to how the value of the entire investment portfolio has changed from the previous quarter end to the current quarter end. For the fourth quarter, the unrealized appreciation of the portfolio decreased by approximately $3.4 million or $0.51 per share. This was due to the market values reflecting the negative environment in the fourth quarter. We believe the market environment in 2019 will remain volatile, but are pleased with the overall market rebound subsequent to the end of the quarter. As I note each quarter, the vast majority of the portfolio continues to be independently marked from broker-dealer quotes. For the quarter, approximately 94% of the portfolio prices or marks reflect a minimum of 2 quotations or actual closing exchange prices. These quotations represent an independent third-party assessment of the current value of the portfolio. At quarter end, the closing stock price of StoneCastle traded at a 10% to the actual market value of the net assets of the company. The fourth component affecting the change in net asset value is distributions. The cash distribution for the quarter was $0.52 per share, which was comprised of the regular quarterly cash distribution of $0.38 per share and a special distribution of $0.14 per share. The special distribution was calculated in accordance with the distribution requirement as a regulated investment company or RIC. The total distribution was paid on January 2nd this year to shareholders of record on December 24th 2018. In summary, we began the quarter with a net asset value of $22.04 per share. During the quarter, we generated net income of $2.8 million and net realized capital loss of approximately $7,000 and the unrealized value of the portfolio investments decreased by $3.4 million. The sum of these components, offset by distribution of $0.52 per share, resulted in a net asset value of $2143 per share at December 31, down $0.61 from the prior quarter. At quarter end, the company had total assets of approximately $196.2 million, consisting of total investments of $189.1 million, cash of approximately $2.8 million, interest and dividend receivables of $3.1 million, receivable for securities redeemed of $428,000 and other assets of approximately $828,000, representing prepaid assets. Our dividend yield at the end of the year, including the fourth quarter special dividend was 8.6% and is currently a little over 7%. Even at that rate StoneCastle’s dividend is still nearly three times higher than that of the average community bank. For the 2018 tax year approximately 32.5% of distributions were designated as qualified dividend income or QDI treatment. As a result a portion of your ordinary income dividend may be taxed at a reduced capital gains rate rather than the higher marginal tax rate applicable to your ordinary income. Depending on your tax situation this can be advantageous versus unqualified or ordinary dividend and have a significant impact on overall after tax returns. StoneCastle Financial does not give tax advice. So please discuss the QDI advantage with your tax accountant and/or financial advisor. Now let me update you on the balance of our current credit facility. At December 31, the company had $51 million drawn from the facility, based on regulated investment company rules, our leverage at the end of the quarter was 26%. We may only borrow up to 33.3% of our total assets. Now I want to turn the call back over to Josh Siegel.

Thank you, Pat. Now operator, we would like to open up the call for questions.

Thank you [Operator Instructions] Our first question is from Devin Ryan with JMP Securities. Please proceed with your question.

Great. Good afternoon, guys.

Hey. How are you doing Devin?

I’m doing pretty well. [indiscernible] for me pretty straightforward quarter. But maybe just a start, so on the Young Partners deal, it seems pretty interesting and creative, I think as you mentioned and then I heard some of the prepared remarks. But I'm curious if you can, how do you source the transaction, was at an existing relationship and whether you see more demand in the market for similar structures or whether you expect to be able to do similar structure or was this pretty idiosyncratic?

So where we source is the way we've always sourced. it's just from our network of referrals, whether it's ABA. This one was a direct Inquiry as we already had a relationship with Citizens itself and this was a very large shareholder who is a bank holding company for the bank and wanted to get some liquidity for their current position. So we basically took a wildly over collateralized position and made him a loan to get him some liquidity in the short term. So we are looking for more situations like that. It has to be a bank we are very comfortable with. It has to be something where we can get significant overcollateralization. But yes, those types of investments is what we're looking for, where we can extract additional value without taking really much different bank risk. George, do you have any thoughts?

Yes, we think it's an interesting dynamic. We like it a lot and we've like this in the past, but bank multiples were extremely high. So it's actually a very good dynamic right now because bank equities have traded off in their bank executives out there who would actually like to buy personally back some of the shares if they get offered. So it's very accretive for them. They're willing to pay rate because they really - we don't have to compete with other people financing that asset class. So our advance rate that we can give on it, as well as the - we're not subject to regulatory triggers, we can really put any covenant we want. So we like that profile and the dynamic board is good right now given that multiples are up.

Got it. Okay. Very interesting. Thanks for the color. And so you mentioned in the prepared remarks kind of looking to increase exposure to other bank related products and I think you also mentioned something of a digital side as well. Can you maybe just be a little more clear around what that is, is that kind of comprehensive both of this type of investment or I just want to make sure I understand those remarks?

Sure. So if you remember back to our entry [ph] from 2014 when we did the secondary, we clarified a couple of things. One is that we have a 20% basket for anything. I mean, technically if you want to buy rubber dog toy company, we can. We’re not going do that, but we could. But it's just a 20% percent bucket for whatever, but still the 80% basket was bank and bank related. It's always been that way. We've found enough opportunities and even today we're still finding opportunities to deploy at accretive rate it’s not enough to really grow our assets, but at least maintain our effort. But we're also recognizing that we're in a protracted period of tighter spreads than we'd like to see on bank deals. And to the extent we see interesting opportunities, which we do from time to time, either in bank related assets or let's say, for example a firm, maybe it's a private equity firm that wanted to make an investment in a bank and it wants to get some financing for its investment to stretch its dollars further, fine, we'll take the fixed income side of that, right? Our financing cost even at 8, 9, 10, is a lot cheaper than what they're expecting to earn in a rate of return for an investment. So we're looking for and keeping our eyes open for a lot of these things that tend to come through our door. So they could be investments in the assets of the bank. They could be investments in companies that are servicing. I mean, we get calls every other week of some company who says, hey, could we partner up and sell our stuff, whether it's services or I want to buy assets from banks through your network of a thousand institutions. And our answer is almost always no, we don't hog people's goods. But if we had some kind of a strategic partnership in it, where we were making an investment maybe it would be worthwhile. So we're going to sort of put a bit more effort into looking through those and if we find an accretive transaction that we think the risk return profile is better, than what we could – are seeing at that given point in time on a bank investment then we're going to allocate dollars more to that, even though we haven't done in the past, it’s not a change of our strategy, it's just utilizing the breadth of our strategy that we've always had. George, any follow-on thoughts?

I think that covers it. I think that key are definitely noticing that banks -- the good news is while bank spreads have compressed, it means theoretically our portfolio is more valuable. But we recognize that we're an income focused vehicle and that is what we want to go into. So we look for those opportunities. We do think banks are actually getting more efficient. They're looking at these. Like Josh is focused on these service companies because banks we're seeing are doing it more and more, they're becoming more and more efficient and more and more profitable. So I think the credit investors have actually got it right with those spreads compressing because we do think they're better. It's actually a little dysfunctional because the equity market is sold off. So we just want to be in the better part of that dynamic. That's why for example we thought the Young loan was super interesting and there's a lot more to do.

Got it. Yes, that's great color. I think being opportunistic is the key. And yes, I think that would be rewarded. So I appreciate that. So last one here, so the borrowing on the credit facility increased a bit sequentially in conjunction with the step up in assets during the quarter and you look at the balance sheet, they are still, when I look at the amount of cash in EPS and some other short-term investments and maybe placeholders. So, they don't want to over read into a precarious around kind of the draw down at the facility and whether we should think about it kind of timing of maybe deploying some of those placeholders or redeploying sooner than later or - is there anything else to read into that move in a credit facility?

No, I wish I had something more exciting to say. I mean, it's sort of the same as it's been for the last couple quarters. The calls of underlying assets have generally flowed. So we don't need to put as much back out. We were still handily generating $0.42 a share in the last quarter, well above our dividend of $0.38. We don't feel any need or pressure even to support the dividend because we're covering it, and because we don't have our asset - underlying assets change all that much, the predictability at least in the medium - short to medium term it's reasonably high. I mean, we could be surprised, if anything calls out. But it's a pretty steady portfolio and we still have a lot of assets that are non call from the community funding transaction and things we've done recently. So when we think about on the go forward, we're looking for more of these interesting situations. I mentioned on the call to Tulsa one that, was one where we actually didn't do a senior sub, we actually are parry on that, but we were able to extract some value in a structure that I don't want to give away, that our competitors trying to copy, but a way that we were able to enhance that till we’re up in the nines. We're going to keep being creative that's what we're paid to do, is be focused on the community bank space and find value that other people can't easily harness on their own. And we're going to keep focused on that to keep covering this dividend.

I’ll just add to that that, that Josh pointed out, that the redemptions haven't been – not redemptions but the calls have been very low. And looking back I mean, for all of 2018 only $4.4 million and you may recall that in prior years for example in 2017 $61 million over the course of the year, $46 million in ’16 $80 million in ’15 . So things have really quieted down a lot there which has benefited us so that we're not seeking to replace things constantly like we back then, it's a lot more calm and I think it gives you guys more time to select really good and high quality investments.

Exactly. Got it. Okay. Well, I appreciate that guys. I'll leave it there, but congrats on a nice year and report assumption [ph]

Thank you. Talk to you soon.

Our next question is from Christopher Testa from National Securities Corporation. Please proceed.

Hi. Good evening, guys.

Hey, Chris.

Hey, thanks for taking my questions. So Josh, I appreciated the color on the deals. Only about $05 billion and one deal comprising a lot of that. What have you seen to the extent that you're able to discuss it in terms of order to date so far for the 3, 31 [ph] quarter with sub-debt deals getting done and if there's been any incremental pickup in yield?

Yields have backed out a little bit in our favor. Still not a ton, but the deal flow has been extremely slow. I don't know the number off the top my head, but I can't think of more than like one deal that I saw come across the tramp [ph] and maybe two and they were quite small. Now again, I haven't sort of kept my ear to the ground on the Citis, BfAs and JPMorgan issuances that, of course, could always skew things, but we tend to disregard that, that's a completely different market. But now it's - as George has mentioned, it's been quiet because banks are kind of flush with capital, which is good. I mean, the value our portfolio is stronger because the credit quality obviously has improved in the overall industry. But until we see what plays out over the next sort of 18 months of the CECL. It depends what happens on credit- credit cycles, you have the Fed saying, yes maybe in ‘21 we're looking at it some kind of a recession, who knows, right?. But the fact they're even saying that gives you some kind of an interesting view. As we sort of predicted internally here, we figured the Fed would have been done at the end of ‘18 with rate - interest rate raises. It seems like that's likely going to be the case for this year. So that - lets things stabilize a bit. In fact, you've seen bank deposit pricing back off a little bit, which is a good sign, right, in terms of banks being able to push back a bit now that the Fed's done and get some expansion in NIM again. So across the industry we're not seeing any hotbeds of credit issues. We still worry about the consumer, the individual consumer debt, ex mortgages the highest it's been in a while, so that’s a little concerning, but mortgage debt is down so much. The overall level is actually not as high as it looks. But we still worry about consumer. Outside of that, we're just not hearing any issues from regulators or banks about any particular as a category or geography. So it's benign. Now that means that we have to get more creative and where we find opportunities, as George said, there's a very large universe when you're talking about, let's say a 3 trillion asset market, order of magnitude 10%, common equity Tier 1, you're talking 300 billion of equity, most of it private, right, in these community banks with very little liquidity for those individual shareholders, we don't want to own the equity, but we don't mind financing it, if we're covered two, three times to one. So we're going to keep an eye out for more of those opportunities. And then again we're finding opportunities where we can make a fixed income investment, maybe extract some warrants or convertible debt to have both rate and maybe a little upside in opportunities that are in the bank base. So we feel okay about where we are. We don't feel any pressure that, oh my goodness, our earnings are under pressure. We have low turnover in the portfolio and we're just going to keep filling the deals that we see coming down the pipe. But it is quiet right now.

Got it. Okay, that's helpful. And kind of segues into a few others things I want to ask you about. So you had mentioned Josh obviously with the Fed sort of backpedaling here. It seems like deposits-wise isn't really at the top of the banks worry list. I mean, are the majority of the banks that you speak to and deal with, are they still concerned about it, but less concerned? Or are they now just sort of taking that perceived risk off the table pretty much for the foreseeable future?

No, I think it's still very much a bifurcated market, Chris. You have a large and of course, we have this insight on more deposits side of StoneCastle Partners not StoneCastle Financial. You have a pretty bifurcated market of banks that are growing and have opportunities and are tight on liquidity and so they're trying to get more creative and resourceful about how can I tap into different deposit market, that I haven't tapped into in the past. We're seeing a number of mid-sized banks kind of that $1 billion to $5 billion or $10 billion. Looking at copying sort of the, the JPMorgan Fin or the markets from Goldman approach of creating an all digital brand to appeal to a specific segment, you're seeing banks get more creative about affinity groups. So no, I think there's still pressure out there. At the ABA conference a few weeks ago where I was speaking on cleanup, they asked me to speak on weathering the next recession, so I'm glad they're at least thinking ahead. I'd say it still 40% to 50% of the topics were deposit related on sessions. So that's still very much front center. But you still have a problem on the other side with sort of slower economic growth around the heartland of the country, you have still a fair amount of banks that are running on average, high 60s to 70% loan to deposit, they just don't have a need and luckily, knock on wood they're being prudent and they're not sort of rushing out to go put loans to work, they're just batting down the hatches and making a 7%, 8%, 9%, 10% ROE which frankly is perfectly fine.

Right.

Right, so I mean, that's sort of the landscape of how people are looking at the liquidity side. I don't see any fear of deposits just vanishing and of course, I really don't worry about our banks because we have a pretty big $15 billion in our pocket book of deposits that we could place at a bank. So that's not going to affect us individually, but no, I don't see that as a real risk in the market.

Okay. All right. That's good color. Thank you. With regards to the type of loan growth is that confined to any areas and I don't mean geography, I mean, are C&I loans lagging more than like, say, owner-occupied CRE or is this just really broad based?

I would say from what I've seen it's pretty broad based. You are seeing a very small minority which we've always been sensitive to and have talked about in calls of banks strength in their more consumer or marketplace loans and we avoid those pretty much like the plague. And that's really – its maybe two handfuls. It's really a tiny number of banks out of the 5400. But we do see a little of that. Beyond that, banks are just trying to be very judicious, trying to find good C&I when they can find it. They're looking for less owner occupied CRE, I'd say the construction and development percent of balance sheets is up a little, not so much that we're nervous, but it's up a little. So that's sort of an indication that banks are tapping out of what they can find. Obviously if you see a bank significantly increasing its exposure to construction and development that's big flag for us. So we wouldn't be investing along that kind of a profile. But it's pretty much across the sector. I mean there just isn't as much economic growth as Washington would like to have us believe. It's not shrinking, but it's not growing at any wild pace.

Right. Yes, I certainly agree with that sentiment. A lot of management teams I speak with also echo that sentiment. And I think last time, last earnings call - excuse me, we had discussed that that the FDIC or some other regulators were saying that banks were really not prepared for CECL, which, of course we all know they're not at the current time. Do you think there's going to be any push from the FDIC or any of the other regulators to get the banks to start thinking about this more that could possibly pull forward some Tier 2 capital needs for banks?

It's hard to read the minds of the regulators, but if past is any predictor of the future, as the deadline gets closer and closer the regulators put it more on the - on their to-do list further up when they do an onsite review of a bank and give a…

Right.

The cycle for bank reviews under HR 2155 has been extended a bit, right, so it's less frequent now. I would think that in the next cycles of field exams, mid ‘19 end of ‘19 I would have to imagine because there's a chance they won't be back in that bank for 12 or 18 months, if they're going to push a little bit harder on that. I think what like – like anything in the bank space, when you start seeing one, two, four or five banks get put under an MOU saying, you need to present to us within six months your CECL plan, then you'll start seeing banks jump to it. But, unfortunately too many banks are going to wait - wait too long.

Yes. Now that's not surprising. And last from me, if I may. It seems that aside from a lower amount of deals getting done there are deals that might be good from a credit perspective, but where the yields are just not there in terms of your sweet spot. Is there an inclination to set up a JV, so there's something that a different structure than the securitization you currently have where you enter with a partner and then you're able to put more financial leverage on a lower yielding, say term loan or sub-debt that is money good, you're not worried about the credit, but where the yield doesn't make sense, but you to get a very good ROE for your portion of the equity in that vehicle?

Well, you're literally describing the Tulsa Valley deal. That's exactly what we did. That was a much larger deal where we took a smaller piece, but we're able to extract economics to - kind of as you said, juicing up our piece. In this case that we didn't do it with more leverage, we just did it with a more creative structure, that obviously I don't want to give away the tips. But we are going to - I mean, I could say right now we're looking at two more of those transactions. So that seems to have some merit. We have a few partners who have been interested to work with us on those. So, more to come. I wouldn't say, there's no magic surprise here, but we're going to be pursuing more of those go forward.

Got it. Okay. Those are all my questions. Thanks for your time today.

Sure. My pleasure.

Ladies and gentlemen, this concludes the question-and-answer session. I would like to turn the call back over to management for closing remarks.

Thank you, operator.

Well, thank you as always for listening. And as always we appreciate your support and the time you take to understand our company and we look forward to speaking with you soon.

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