Good morning, ladies and gentlemen, and welcome to Baxter International's Second Quarter 2023 Earnings Conference Call. [Operator Instructions] As a reminder, this call is being recorded by Baxter and is copyrighted material. It cannot be recorded or rebroadcast without Baxter's permission. If you have any objections, please disconnect at this time. I would now like to turn the call over to Ms.Clare Trachtman, Vice President, Investor Relations at Baxter International. Ms. Trackman, you may begin.

Good morning, and welcome to our second quarter 2020 earnings conference call. Joining me today are Joe Almeida, Baxter's Chairman and Chief Executive Officer; and Brian Stevens, Baxter Interim Chief Financial Officer and Chief Accounting Officer. On the call this morning, we will be discussing Baxter's second quarter 2023 financial results along with our financial outlook for the third quarter and full year 2023. Please note, results in the current period and prior periods have been adjusted to reflect the pending sale of our biopharma solutions or BPS business. While the closing of this transaction is subject to the satisfaction of customary closing conditions. That business is now reported as a discontinued operation. We have posted restated schedules reflecting that presentation for prior periods to our IR website. In addition, we will be providing a walk to reconcile our prior guidance for full year 2023 for updated financial outlook for continuing operations and in the aggregate. With that, let me start our prepared remarks by reminding everyone that this presentation, including comments regarding our financial outlook for the third quarter and full year 2023, new product development including the impact of pending regulatory approvals; the potential impact of our in-flight strategic and pricing actions, business development, regulatory matters, in the macroeconomic environment, including commentary on continuing supply game challenges and evolving customer capital spending contain forward-looking statements that involve risks and uncertainties. And of course, our actual results could differ materially from current expectations. Please refer to today's press release and our SEC filings for more detail concerning factors that could cause actual results to differ materially. In addition, on today's call, non-GAAP financial measures will be used to help investors understand Sector's ongoing business performance. A reconciliation of the non-GAAP financial measures being discussed today to the comparable GAAP financial measures is included in the accompanying investor presentation and in our earnings release issued this morning, which are both available on our website. Now, I'd like to turn the call over to Joe. Joe?

Thank you, Clare. And good morning, everyone. We appreciate you joining today's call. I will begin with an overview of Baxter's second quarter 2023 performance followed by a look at the progress we're making across the strategic actions we announced earlier this year. I will then turn it over to our interim Chief Financial Officer and Chief Accounting Officer, Brian Stevens, who will walk you through our quarterly performance and outlook in more detail. Finally, as always, we will welcome your questions. Second quarter sales rose 3% on a reported basis and 4% on a constant currency basis both measures exceeding our prior guidance of 1% to 2% and 2% to 3%, respectively. As a reminder, and as Clare noted, we are reporting results of our biopharma solutions or BPS contract manufacturing business as discontinued operations in light of its pending sale which I will touch on shortly. I would note there was no impact in the quarter on top line growth rates from discontinued operations on either a reported or constant currency basis. Our top line outperformance was driven by solid demand across the portfolio. On the bottom line, second quarter adjusted earnings per share from continuing operations totaled $0.55 a and discontinued operations totaled $0.11. In the aggregate, adjusted earnings per share totaled $0.66 and exceeded our outlook range of $0.59 to $0.61 and driven by a combination of top line performance and operational efficiencies. Several factors combined to help bolster both top line and bottom line results. First and foremost, I want to highlight positive demand and greater stability across most corners of the health care marketplace. Following the erratic impact of the pandemic and its recurrent surges over the past few years. Overall, we are continuing to see sustained recovery in hospital admissions and procedural volumes…

Joe mentioned, we are pleased with our second quarter results, which came in ahead of our expectations. Second quarter 2023 global sales included $3.71 million from continuing operations and $142 million from discontinued operations. Sales in the quarter increased 3% on a reported basis and 4% on a constant currency basis and compared favorably to our guidance. Sales performance in the quarter benefited from better-than-expected sales across nearly every business line with particular outperformance realized in Medication Delivery, Pharmaceuticals and patient support systems. On a year-over-year basis, we recognized solid growth across much of the portfolio, which was partially offset by a 1% decline in Patient Support Systems, primarily reflecting lower rental revenues and reduced hospital capital spending as compared to prior periods. We also generated lower sales in BPS, which is now reported in discontinued operations due to a reduction in revenues from COVID vaccine manufacturing. On the bottom line, adjusted earnings in the aggregate, inclusive of both continuing and discontinued operations, decreased 24% to $0.66 and reflecting the impact on our results of the increased cost of materials, labor and freight we've absorbed due to the significant inflationary environment experienced over the past few years. Adjusted EPS for the quarter came in ahead of expectations of $0.59 to $0.61 per share, primarily driven by sales and operational performance. A lower-than-expected tax rate offset the negative impacts from foreign exchange and losses on equity investments. Now I'll walk through performance by our regional segments and key product categories, starting with sales by operating segment. Sales in the Americas grew 5% compared to the prior year on a constant currency basis. Sales in Europe, the Middle East and Africa grew 3% on a constant currency basis, and sales in our APAC region increased 4% constant currency. As we look to…

We will now begin the question-and-answer session. [Operator Instructions] I would like to remind participants that this call is being recorded, and a digital replay will be available on the Baxter International website 60 days at www.baxter.com. And your first question comes from the line of Robbie Marcus from JPMorgan.

Congrats on a good quarter. Joe, maybe to start, it looks like the recovery is progressing nicely beat and raised but it's a bit complicated with discontinued and continuing operations. So would love to get a sense of -- how did the pro forma, the combined company do in the quarter on margins? And so we can compare it apples-to-apples. What's the expectation for the back half of the year and your confidence in regaining the margins?

Thank you, Robbie. Good morning. I ask Brian Stevens to ask. We will make sure that everything you guys need to know is clarified as we had a very solid quarter, and I want to make sure that the information is clearly understood and then we can talk about the other things that drove our success this quarter.

Thanks very much, Robbie, for the question. And as you mentioned, due to the signing of our agreement to sell BPS, which right now we expect is going to close likely in about 2 months at the end of September, although that's subject to customer closing conditions, as you can imagine. This has triggered discontinued operations reporting. One thing I did want to highlight is that at the end of our investor presentation, we have gone back and casted, recasted recent quarters to show our adjusted results on a discontinued operations basis to provide some visibility apples-to-apples going forward. One thing to point out though that what that does is while it takes out the contribution from BPS in the comparable periods, that recasting does not reflect the benefits that we expect to get going forward from interest expense savings. So I think if you're looking at EPS for the full year, while we expect about a $0.43 impact from discontinued operations after you net in the interest savings and things like that, we really think the headwind on an annual run rate basis is probably closer in the range of $0.15 to $0.18. So specific to your question, as far as where our operating margins landed, we reported on a discontinued operation basis, adjusted operating -- or adjusted operating margins of -- in the ballpark of about 13.2%, including the full company, we came in for the quarter at 14.4%, which was a little bit above where we were expected to land. On a full year basis for the entire company as if we own BPS for the full year, we would expect our operating margin -- our adjusted operating margin to come in at 15.5% to 16% and which is consistent with the prior guide that we gave…

Great. That's really helpful. And maybe as a follow-up, your competitor recently got approval for their infusion pump platform in the U.S. I know you've resubmitted [indiscernible] large volume pump in early June. I was just wondering if there's any update there or any comments you could provide?

We believe we have successfully resolved the open issue that was primarily subject of the FDA's last additional information that they requested. Additionally, we have proactively implemented software changes that we had planned in consultation with the FDA. We have regular communications with the FDA during the review. We are committed to resolving any questions or issues that come up during the process and through learnings in connection with the recent launch of Novo LVP in Canada and related regulatory issues. So we are working on software upgrades to our current version of the Canadian pump. As we work through this in the next few months, we work alongside the FDA to tell them what's going on. And we are cautiously optimistic [indiscernible] updates to the product are implemented before in Canada and so we can communicate with the FDA properly. We are in constant communications with them. I just also want to add that our SIGMA Spectrum pump is doing extremely well. We are augmenting the supply chain of that pump to make sure that pump continues to be available. We need that pump to be available. We have hundreds of thousands of these pumps on the market, and by doing that, we're able actually to give continuity to hospitals, which own that today. It's a matter of fact that growth has been great. This year, we upped our forecast twice since the beginning of the year as the supply chain became better, and we are making sure that in the next 12 months, that pump will be backward integrated into the new gateway system that Novum uses in hospitals. So we have really alternatives for everything. I'd tell you, we've been getting market share steadily year-over-year. and we'll continue to do that. Of course, we're looking forward to have normal LVP in the U.S. market in just a little for our syringe pump, which has done extremely well, and we are actually exceeding by far our expectations for this year.

And your next question comes from the line of Larry Biegelsen from Wells Fargo.

Congrats on a nice quarter here. Joe or -- sorry, or Brian, yes, I wanted to ask about the guidance. You put up a nice 4% growth number in the second quarter, but I believe the third quarter you're guiding to about 1%. And Joe, you talked about improving trends so maybe talk about what you're assuming in the second half and why growth might be lower in the second half than what we've seen here in the second quarter? And I had 1 follow-up.

Sure. I'll skip the started and then Joe can add anything. Thanks very much for the question. as you saw in the current quarter, we're really excited about our growth. We came in at 4% on a constant currency basis, which reflected really strong contributions and performance from our MPT business, which came in around 7%; our pharma business, which was at around 6%, reflecting some of the recent launches we've had in the U.S., including Zosia [ph] room temperature [indiscernible] our Frontline Care business came in around 9% as it worked down some of the backlog, and we saw strong demand for intelligent diagnostics and respiratory health and then finally, we started to see some traction in PSS in recent periods, which as we talked about before, we have seen some softness in capital orders that appears to be stabilizing, and we're seeing good traction going into the second half of the year as our order volume has picked up, although that business is still facing some headwinds from lower rental revenues following COVID where demand for rental beds was high. So really, the story for the sequential deceleration in our growth going into the third quarter where we're expecting it to slow down a bit to around 1% and is really driven most significantly by the headwinds facing our PD business in China. As we mentioned, within that business, we have excess mortality that has reduced our patient census counts following some of the impact of the pandemic that they've had over there. And then also in the second half of the year is where we're starting to see a little bit more of the impact of volume-based procurement in China. So I think net-net for that Kidney Care business, which includes renal as well as acute, we're seeing about a 250 basis points impact from some of those headwinds. Additionally, there are some discrete items that happened in the prior year period that we've highlighted currently or previously that we're going to be lapping, which is driving down our sequential growth a little bit. But I think overall, we've still been able to offset those headwinds with strong performance across the rest of our portfolio.

Augment the part on the concerns in the beginning of the year that we had with capital. We've seen that alleviating -- and I have to say that the launch of Progressive Plus has been a tremendous success. We've seen good momentum, a very update in quotations and also conversion from quotations to PO into delivery. That, as a matter of fact, we're starting to see competitive conversions, which is we're taking market share for competitors -- from competitors. So this has been a good track record for the company when they launch new products. And now with a very good team in place, we are able to actually execute on the plan above and beyond the great performance from Linecare and our medication delivery business as well in the U.S. So just a little bit of more color to Brian's comments on our excitement around the business.

Just one quick follow-up for me. Obviously, the Pfizer injectable plant, the damage definitely got a lot of media coverage the last couple of weeks. It seems like it was more just a warehouse that was negatively impacted. Do you see any potential benefit from that? Or is it your understanding it was more the warehouse, not the manufacturing that was impacted.

Larry, I'm not going to comment on Pfizer's status. They have to answer their own questions. I can tell you that from the portfolio that they sell, we have a little bit of competitive products that we can ramp up in the second half of the year. Will depend a lot about how much inventory is in the chain. But I'd say probably a little bit north of $10 million. is one opportunity that we have, maybe a little bit more than that, a little bit less. It depends what's in the chain. It depends how this is going to be there. One important thing is Baxter will be there for the patients when they need it. And if the customer needs will be there to serve them with the products that we have.

Larry, just to clarify that we have not included any upside in the guidance that we provided. Obviously, we're continuing to evaluate the situation. As Joe mentioned, we do believe there is some overlap. And so the team is working and how we can address and fill those gaps in the marketplace to ensure the customers get those products.

Your next question comes from the line of Danielle Antalffy from UBS.

And not to be too greedy here. I know we just have updated 2023 guidance and tough to talk about 2024 at this point given all the moving parts here. But I would love to get some thoughts maybe at a qualitative or high level. As we look ahead to 2024, in the RemainCo piece of the business, ex renal, what the key growth drivers will be? Obviously, hopefully, Novo IQ [ph] is one of them. But beyond that, Joe or Brian or Claire, if you can talk about sort of over the next 12 months, what you see as the key growth drivers beyond [indiscernible] that we should be focused on here for the business?

I want to highlight what we call HST, which is our former call the Huron business, HST I think there is a great opportunity still in the frontline care. Front Line Care is really driving high single-digit growth. I think that will continue. And I think the recovery and the potential gain of market share in beds is a good possibility for us looking at the performance of our new bed launch today. I think another one is advanced surgery. We have per cloud coming in, the demand is high. The product is superior in side-by-side testing that we've seen to competitors. I'm not claiming anything on the label. I'm just saying that when we do, it looks like the product has a performance that pleases the customer by the speed and completeness of the hemostasis products. This is the first product that is Baxter's are passive hemostat. We don't have a test hemostat. And we're now constrained just by the capacity of the company to make the products, but we are working the supply chain to get a second supplier and which is going to come in line hopefully in 2024, but the demand is really good, and that's a good driver for it. And we have in the pharmaceutical business, we have new launches. Our new management in pharmaceuticals has really improved our ability to launch products and get the time to pick sales. So we have some really good stuff happening. And clearly, we would like to count on Nova. We're going to do everything we can to get that on the market. But as a backup to tell, we have a very solid platform with spectrum are still taking market share. And the syringe pump really makes it easier for us to penetrate hospitals that otherwise were never available to us before. So I think Baxter all in all, as we execute all those changes, the sale of BPS then spin off Renal is to create a company that is smaller, driven by innovation and the ability to actually impact lives of our patients is what we're targeting for 2024.

And maybe if I could add to that a little bit, Joe. Another item that we're really excited about is the recent launch of our Progressive Plus ICU bed. We're seeing really good demand from that even though it's in the early stages. And we're also excited about some of the new features that we just came out with for our Centrella bed platform as well. The other item I'd like to highlight that's a big internal focus for us in terms of driving growth going forward is really the impact of the new operating model that we're transitioning to. As we've talked about previously, earlier this year, we started the process of shifting from a regional and focused organization is really a vertical-focused organization where we have leaders of our new segments that are really like many CEOs that own the entire business from top to bottom, including the supply chain aspect of that. And I think as we mentioned before, we're planning to transition to our new segment reporting in the second half of the year. Right now, we're actually expecting that that's going to be coming off this coming quarter. So we're really excited to be able to share some of the financial performance at that cut with all of you at that time. But as part of this transition, our new segment leaders are very much focused on developing portfolios of initiatives that we're looking to really grow the business going forward.

And your next question comes from the line of Patrick Wood from Morgan Stanley.

Amazing. I'm just curious in renal, if we make the adjustment, obviously, in HD for that distribution agreement, how you're seeing the relative performance of PD versus HD, if you're seeing any kind of a shift there? Or if you're seeing comparatively similar trends in patient flow across those 2 sort of verticals, very curious there.

Our PD business, with exception of China, which I think we -- in the prepared remarks, we spoke about the 2 things affecting the being the VBP and also the mortality due to COVID. If you isolate that, the rest of the business is starting to recover from the COVID. We're starting to see patient growth, some geographies with mid-single-digit growth. Some others with low single digits, but coming up from negative growth last year. So we're starting to see that going well. We also took other initiatives to augment that business. We see HD as a portfolio rotation for us. We're looking at where to be, how to make that business accretive to Baxter, and we are in full-fledged optimization process. So we have -- we're looking at our dialyzer business. We're looking our HD monitors. And making sure that we are in the right place at the right time, competing in the right way. We want to make sure that, that is a supplemental business to Baxter that is profitable and is growing. But we're starting to see with optimism with the exception of China growth and recapture of the PD market. Remember, this is a business that we post COVID project long term to be a mid-single-digit growth business in terms of patient so we want to make sure that as the situation stabilized in China, we are prepared 100% to continue to grow in that market.

Your next question comes from the line of Travis Steed from Bank of America Securities.

I did want to follow up, Joe, on Nova. It sounds like you have to upgrade the Canada pump first and that takes for a few months. And then after that's finished, then you can move it and work with the FDA. I just want to make sure understand the nuances there from your earlier response

Yes. Travis, the pump in Canada is on market. The U.S. doesn't have Nova is not approved. So to your point is we had some software updates. We're making -- we have some available to go through working with Health Canada to make sure they are okay with us moving forward. We also have other changes that we're going to be making in the next couple of months. to make sure that that bump is all the potential upgrades and improvements are in place and then as we work with the FDA. Our application has those changes factored in, but we want to make sure that we want to -- we execute them in Canada, and we work with the FDA. We want to make sure that but I want to tell you that we don't speak on behalf of the FDA, neither Health Canada. We work with both of them trying to -- and we will address all those problems as we confident that our technology and our platform is solid. We continue to upgrade like we would have done to any other products to address any concerns on the market.

Perfect. And then the other question I had was on the CFO update, ability to announce that by year-end. Any color on the type of person you're looking for or progress you're making with that search?

Well, first of all, we have Brian doing a great job here sitting in for CFO. And as always, a great contributor to Baxter. And then during this quarter, a tremendous amount of work our teams were able to do to be able to provide you guys with discontinued operations or the reconciliation. We are in process, continue to interview internal and external candidates, and we will be hopefully in a position in the next 30 to 45, 60 days to make a final call.

Travis, the one thing I would just want to augment to Joe's comments on [indiscernible] is to remind everyone that NOVUM is a brand-new innovative platform. that has some of the most advanced safety features out there. So again, to Joe's point, we're going to look at that and obviously work with FDA. We can't speak on behalf of FDA. But this is a brand-new innovative platform. And we mentioned the NOVUM syringe is doing really well in the market already. So we're going to look at -- obviously, address the situation with Health Canada and some of the issues as you find when you launch a brand-new platform, those issues can come up. So we're going to address those and obviously work with both agencies to get this pump on the market.

This is not a legacy pump, which is decades old in the market. They had issues to be remediated -- this is a brand-new pump like Claire said. It is a complex technology, and we have the competency in Baxter to address those issues. And as I said, I'm very confident in the technology, and we are cautiously optimistic about how we get this approved.

Your next question comes from the line of Vijay Kumar from Evercore ISI.

Congrats. Good print here. Maybe my first question on the product side, Joe, I think you mentioned 30% orders growth. How does it translate to revenue growth for your PSS segment, U.S. pharma up double digits. Are we seeing pricing being stable in the U.S. at this point in time?

Vijay, we'll take one thing at a time. We are seeing the order between Q1 and Q2 growth for PSS, and that has encouraged us. We are we're going to cross the threshold on growth. Remember, this growth now was slightly negative. This quarter was ahead of our expectations. And we were looking at sequential growth in this product line.

Yes. So here's what I would -- let me augment that a little bit. So to Joe's point, we did see around 30% sequential improvement across all of PSS, which is obviously is both our furniture plus our care communications products. Just to be -- in the third quarter, Hill-Rom did have their year-end in the third quarter. We do face -- obviously, as we continue to kind of anniversary that, we do face a little bit more of a challenging comp from just an overall sales dollar in the third quarter. But the order rates are improving. And as we go to the second half, we expect the second half orders to be ahead of what the first half is. So we're kind of seeing that continued momentum second half versus the first half of the year. But I think the key is that both on the Progressive Plus and the Central CLR, we're seeing a lot of positive momentum there, and we're going to continue to augment that with a lot of the features that we have within the Connected Care for the HST business.

And in terms of pricing, I think you referred to pricing in general, are you talking about pricing of PSS.

Sorry, for U.S. pharma pricing?

For U.S. pharma. We see continued pressure what Baxter is doing is by launching new products that we call the specialty generics, which are our premixes like we did with Norepinephrine and [indiscernible]. It has been a phenomenal execution of launches. And those products carry significant gross margin. So as we continue to face price pressure on more generic molecules, we're able to offset that, as you can see by the growth of this business in the second quarter and how we're going to go forward with this business we are making huge progress against price erosion. And that can only be done, can only be done with launches of new products, and we've been executing extremely well in all of them.

Yes. What I would say to that, Vijay, within our U.S. injectables business, I mean, this business is really growing double digits, low -- kind of low double digits really driven on the success of these launches. So we have been able to now fully offset that price erosion. That will go on, but we will be offsetting it with our new product launches.

That's helpful. Then maybe one on margins, your back half, 200 basis point step up. How much of that is related to the volume leverage on higher revenues versus your supply chain and cost actions. And those supply chain cost actions, should we assume those are structural and should flow through for next year?

So if we're looking at our overall operating margin improvement, I think just sales growth alone is contributing close to 200 bps of the moment I think on the supply chain side with some of the stabilization of inflation and the continued savings initiatives, I think we're seeing roughly about 70 basis points of improvement and then on the cost savings initiatives that we've been undertaking, the impact for the back half of the year, we're expecting is going to drive around 80 basis points and those 3 items are actually offset by the impact of FX versus where we're at when we gave our prior guidance, which is coming back about 50 basis points.

We have time for one more question.

Our final question comes from the line of Matt Miksic from Barclays.

So I guess, I'd love to ask just a couple of broad questions, if I could. And the first, I think the perception may be that one of your comp competitors got out of approved. You have not yet got your new pump approved, the perception is that this is viewing the sort of the competitive landscape in a way that may be disadvantageous to Baxter in the near term. And I know you've just stepped through a little bit of this, but I'd love to get your sense of having statement of spectrum on the market, and this being your next-gen pump, if you could talk a little bit about what the current competitive dynamics look like on the pump front? And what you expect them to look like from now until when you're able to introduce your sort of next-gen platform? And then I have one follow-up, if I could.

Yes. So I'll let Joe weigh in on this map. But as I just reiterated, again NOVUM is a brand-new innovative platform. But we also do have spectrum, Sigma Spectrum or version 9, and we have been Spectrum IQ that has been -- we've been successfully selling that. We are ramping up production of that. And to Joe's point, we are going to make it backward compatible with our gateway so that it will have all the features and be able to integrate within the hospital EMR similar to what NOMVUM was going to do.

I think we said this more times, Matt, it is we have an on-market pump and we've been converting market share. As a matter of fact, we just converted accounts from a competitor for the reasons of the merits of spectrum by itself. So we do have that opportunity. Do we have greater opportunity with NOVUM? Of course, we do because it's a platform that has some safety features and integration that is a great opportunity for customers to have other software that we have come into play. So we're looking forward to that approval. But until then, we continue to do well with the current platform, and it's going to make that even more friendly by backward integrated into our new gateway, which is also develop by Baxter for our new platform that makes it easier to integrate between the syringe and the SIGMA spectrum.

That's super helpful. And then just on growth. I think we understand the sale of biopharma and a deleveraging opportunity that, that's provided and change positive change year-to-year capital structure. In terms of the Hill-Rom business and the growth trends, I think -- we get the question often like what can that business grow? I mean it looks like it's already kind of accelerated from maybe down 1% in the first quarter on a combined basis, still like up 4% or something like that here in the [indiscernible] if I'm looking at the numbers right, are we on our way to -- is that current growth rate representative growth rate based on what you would say, what you know about the business now? Do you think there's more room to lift that business into the back half and into 2024? Any color there? And I know -- sorry, you touched on these topics also during the call. I just want to be clear about the growth potential as you look at it right now?

Yes, Matt, I'll just give some of the facts. You're exactly right. In the first half of the year, the Hill-Rom or did call it the AST business was up low single digits. We expect that to accelerate to mid-single digits in the back half of the year, consistent with our expectations. Really driven by all the factors that we've talked about, improvement in Front Line Care, both and then within the PSS business, the new product launches. So that -- we believe that, that is that mid-single digit that underlying run rate is what we will continue to see going forward. But I'll let Joe.

Yes. I think not only the product launches in PSS, but also some of the success that we have in cardiology, which is smaller still in our Frontline Care as well as some other new products that we have in store for 2024. I believe this business is their growth is above the Baxter weighted average growth rate. So that is augmented is an augmented growth for us. I'm excited about that. That's the reason why we acquired Heron was to create that differentiation in growth rates to be able to get to mid-single digits for our businesses. And with the portfolio moves we are making, we're going to get there and has been a really -- last year was all about supply chain and with a real difficult period for both businesses as we see us making significant progress in creating resiliency to the business, I see that PSS with great opportunity and don't discount our surgical business, our GSS business, which also is a great potential source of growth in the future. So we are excited about that business, and we have the potential to transform even further Baxter with even more growth in adjacencies through that business.

Congrats on the quarter.

Ladies and gentlemen, this concludes today's conference call with Baxter International. Thank you for participating.