Good morning and welcome to the Brown-Forman Fourth Quarter and Fiscal Year 2019 Earnings Call. My name is Nicole and I'll be facilitating the audio portion of today's interactive broadcast. All lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question-and-answer segment. [Operator Instructions] At this time, I would like to turn the show over to Jay Koval, VP of Investors Relations. Please go ahead, sir.

Thanks, Nicole, and good morning everyone. I want to thank you for joining us for Brown-Forman's year-end earnings call for fiscal 2019. Joining me today are Lawson Whiting, President and Chief Executive Officer; and Jane Morreau, Executive Vice President and Chief Financial Officer. This morning's conference call contains forward-looking statements based on our current expectations, numerous risks and uncertainties may cause actual results to differ materially from those anticipated or projected in these statements. Many of the factors that will determine future results are beyond the Company's ability to control or predict you should not place undue reliance on any forward-looking statements and the Company undertakes no obligation to update any of these statements whether due to new information, future events or otherwise. This morning we issued a press release containing our results for the fourth quarter of fiscal 2019, in addition to posting presentation materials that Lawson and Jane will walk through momentarily. Both the release and the presentation can be found on our website under the section titled Investors Events and Presentations. In the press release, we have listed a number of the risk factors that you should consider in conjunction with our forward-looking statements. Other significant risk factors are described in our Form 10-K, 8-K and 10-Q reports filed with the Securities and Exchange Commission. During this call, we'll be discussing certain non-GAAP financial measures. These measures are reconciliations to the most directly comparable GAAP financial measures and the reasons that management believes that they provide useful information to investors regarding the Company's financial conditions and results of operations are contained in the press release and investor presentation. As a reminder, before I turn the call over to Lawson and Jane, in the interest of time at fairness, we ask that you limit your questions to one per analyst. You are welcome to rejoin the queue and we'll take your follow up questions as time permits. So, with that, Lawson?

Thank you, Jay, and good morning everyone. We've called this the year of change, challenges and continued consumer momentum for Brown-Forman. We're generally pleased with our top and bottom-line results for fiscal 2019, both of which were up 5% on an underlying basis. Importantly, our top line growth rate would have been really -- I call the run rate would have been 6% excluding the impact from tariffs. So, generally call it a good year in maintaining consumer momentum, not a great year given all the headwinds that we're facing to the bottom-line, but still a good year for us. We've a lot of reasons to be optimistic, I think about fiscal '20 and beyond. Starting with the U.S. spirits markets itself where the trends are strong as ever, particularly within the consumer goods world, the U.S. spirits market remains one of the best businesses in CPG. We believe we have one of the best premium spirits portfolios in the world, as evidenced really by the strength and consistency of our long-term results. We've averaged 5% to 6% underlying top line growth for most of the last decade and we expect more of the same in fiscal '20. So, Jane in a few minutes will share more of the detail behind what we believe was balanced delivery of these results in fiscal '19 and then also share some key milestone that we achieved during the year. So rather than remember fiscal '19 is the year of tariffs, we'll change the headline to be 2019 remembered as the year we continue to invest in momentum across the portfolio and we delivered balanced growth across many geographies and brands. Recently, the IWSR Global Report came out in a week or two ago and it was interesting to read as it covered or…

Thanks Lawson and good morning everyone. I plan on covering three main areas today during my prepared remarks. First, I'll review our fiscal 2019 results; second, I'll discuss our fiscal 2020 outlook; and third, I'll walk you through the foreign exchange and tariff headwinds we have been facing. After I complete my prepared remarks, we'll open it up for Q&A. As we reflect on fiscal 2019, we are very pleased with our employees and partners' ability to adapt and manage through a very active year of change and challenges. We continue to invest in the consumer momentum across our business, which resulted in a consistent and solid results you saw this morning, as well as the achievement of several milestones, which I will cover later. As Lawson mentioned, we estimate the price adjustments associated with tariff reduced our full year operating -- underlying net sales growth by nearly 1 percentage point. Thus, we believe underlying net sales growth of 6% after adjusting for this tariff is really impressive rate of growth in the consumer world and in line with our long-term track record of performance. Adverse foreign exchange was a primary delta between our underlying and reported sales growth of 2%. Our top line growth was driven by broad-based geographic change and a balance contribution across our portfolio of brands. Further, the year was marked by a balanced year of capital deployment and a continuation of our industry-leading operating margin and return on invested capital. Okay. Now, let's look at our fiscal 2019 sales results by major geographic cluster. After a soft start to this fiscal year in United States, underlying net sales accelerated slightly from the first half to the second half. Despite this acceleration, the back-half performance in the United States fell below our expectations and was the…

Certainly. [Operator Instructions] And the first question comes from the line of Chris Pitcher with Redburn.

You referred to the launch of Apple in the back half of the year. I was wondering, if you could talk through what lessons you've learned from Honey and Fire? And how specifically you're looking to position the brand to tap into the 2 million cases that you referred to? Thank you.

Yes, I think -- and Jane you can weigh into, but over I'll say the last nine years -- it's been about nine years since we launched Honey. We have been very thoughtful and measured with our flavor strategy. But one thing we do know is the flavors do to bring in new consumers into the franchise and that’s probably the single most important point and one of the reasons why we continue to believe in them. It's been -- since 2011 with Honey and then 2015 with Fire, so those brands have been around now for a while and they continue to grow. And as I said, they continue to add to our annual growth rate but our margins, so these are good healthy businesses for us. I find it interesting, flavored whiskey now -- I mean, this is just the U.S. comment, but flavored whiskey is now larger than the flavored vodka category in the United States. So, it’s a big category, it’s a very profitable category and one that we've seen really minimal cannibalization over a period of time. So, there's a lot of good things going on in the world of flavored whiskeys for us and one we're going to continue on it, and I should say, as if it's only going to be in the United States and it's only the second half of fiscal year. So, it doesn't have a massive impact on next year. But long term when we roll it out internationally, we'll really be the first big brand that goes with Apple flavor internationally and it keeps us pretty optimistic that can be a meaningful business.

And just to be specific, not want to pin you to targets. But in terms of the first 12 months of launch, should we expect a sort of honey-style step up in terms of volume? And specifically, how you're positioning it to not cannibalize the Honey brand?

Well, we don't have -- we are not going to give kind of a volume forecast. We've said that it can improve our growth rate by about half a point next fiscal year. So, that you can sort of back into to some sizes there. But now, I mean, I think the way people consume the Apple will be different than the way they consume the Honey brand. And so, as I said, we haven't seen significant cannibalization in the past and we don't have reasons to see it. We don't really think it will be that big going forward. Obviously, there's a lot of Jack Daniel's drinkers right now that have moved into Crown Royal Apple because that brand has been so big over the last few years and so, our hope is that we're going to go get share back from there too.

Your next question is from the line of Peter Grom with JP Morgan.

So, Jane, I was hoping if you can elaborate more on your underlying SG&A outlook. The performance in '19 was clearly impressive, but on top of cost savings and efficiency, you've highlighted in the past that some of OpEx leverage was more one-time in nature as well as due to competition. So, can you may be just touch on where you see the opportunities to cut more? And then also, what would kind of trigger those bonuses or compensation related items that helped '19 to move back into SG&A in '20? And does your guidance reflect those bonuses coming back? Thanks.

A lot of questions there. So, I think you're just really asking about our guidance on SG&A going forward. And I will, as we talked about in my script today, just if I go back to 2013, we have been reallocating from SG&A to brand expenses purposefully for a number of years and over the last five years our SG&A with what it's today versus what it was five years ago, due to what you're referring to as some of our productivity and efficiency initiatives that we've had going on. But, yes, we have been able to continue our strategic investments whether it's an emerging market or rest of the market and so forth, and we plan to do that. We still have some other projects going on as it relates to SG&A, but we continue to have -- when we think about efficiency and productivity initiatives, we think about every line item, every operating expense line item of the P&L, so that starts from discounting and ensuring those are the most effective and efficient they are. So, it gets into our revenue growth management capability, it gets into our cost of sales, looking at packaging opportunity, looking at ensuring of supply chain as efficient as they can be. It looks that at sourcing opportunity is not only in our cost of goods, but in our advertising initiative, and these are all projects that we continue to have ongoing as we look ahead. And so, I've guided this morning to a modest growth in SG&A, a low single-digit growth next year in SG&A. We did benefit this year as you noted from one-time items, and as you know, some of that was a compensation related items. But we've got -- what we plan for next year is, we have a philosophy regard to our compensation, we got to pay for growth or we got a grow to pay for that growth. And so, that's all built into our outlook for next year.

The next question comes from the line of Vivien Azer with Cowen.

So I wanted to touch on pricing and promotion. Jane, your call out on stepped up promo in 2020 in the U.S. In particular, it makes a lot of sense even some of the trends that we have been seeing. So I was hoping that can you just comment on how that impacts your expectations for the pricing that you’ve been seeing in the Brown spirits category in the U.S. -- has that been tempering already. You expect that to continue, and then how that impacts your thoughts around the total company top line algo volumes, pricing and mix? Thanks.

Yes, okay it was lot there too. I'm glad you pointed out and then brought up the promotional, the incremental spend that we’re going to do in the U.S., and we started doing a little bit in the fourth quarter really in late April. And if you recall from our third quarter call, we actually had expected some of the promotional activity in some of our shifts and spend more to broad-reach media to actually take hold in the fourth quarter and accelerate our U.S. growth faster than -- and it just hasn't come about yet. So, we're very encouraged by our most recent and I don't -- you all know me, I don't typically focus on short-term trends that because we were able to get these programs in late in year, in April, we went on new creative and broad-reach media starting last week of April. I think it’s relative to look at what’s working now and the latest drop of Nielsen trends shows, for Tennessee Whiskey in particular, an increase in the volume. You will see some increase in promotional activity too as you’re pointing out. As we look into the rest of 2020, we will expect to continue to have some increased promotional activity, more embedded in terms of when and how we do it, we’ll be very smart about that, as you know we will be. So, as we look at to plans for next year when I talked about the 5% to 7% growth at the top line and underlying basis, it will be another year of more volume driven plan than a price driven plan. We do have some pricing expected, largely tequilas, which we can talk about later. But other than that, it’s going to largely be a volume driven plan with some benefits continuing from mix because as we’re expecting next year’s volume growth from our premium plus business to continue to outpace and provide mix benefits.

The only -- I'll put just a couple of other points around. I mean, in calendar 2018, we did take prices up on Jack Daniel’s. We were up during the O&D period and unfortunately the competition went down at the same time and we got hurt and that’s part of the reason why U.S. had a tough year last year. And we really did -- I call to call the action on the U.S. teams over the last few months all the way through the three tiers to really rally behind the Jack Daniel's Tennessee whiskey brand. And as Jane mentioned, there are significant increases in media. We’ve got all kinds of new creative out there and we are going to be a little bit more aggressive on the pricing front, as we say, some of the short-term reactions are pretty good, but it’s one of the reasons why I do think, we will have a good year in the fiscal '20 because we’ve led out a little road to the teams to be a little more aggressive. And hopefully, we’ll see the results from that.

Your next question comes from the line of Amit Sharma with BMO Capital.

Hi, there, this is Drew Levine on for Amit. Thanks for taking the questions. I wanted to ask about the Mexico tariffs that are supposed to go in place next week, I know tequila is around 8% of the portfolio now. Can you just provide some context on how much of that is in the U.S. if potential tariffs are contemplated within your guidance and then kind of combined with pricing actions on tequila? If you think, you might need to take even more and how that could impact volume for the category? Thank you.

Great questions, and on guidance we do not have any increases, decreases built in there. So, no rescinding of tariffs from Canada or Mexico, but they have already said, no reduction in Turkey's tariffs, 140% north. Mexico is going the other way. What that being said, as you saw -- this is a staged impact that would go up on a monthly basis. And if we look at the rescinding versus the new, it's not material to our overall picture next year. Our tequila sales in the U.S, this would be new on import of tequilas in the U.S. This tax that you're referring is only 3% of our total revenues. So, it's pretty small in the grand scheme of things. When we look at pricing itself, just as a reminder related to this and my script too, we are taking pricing next year in Mexico or this year Mexico in fiscal 2020, which had pretty aggressive pricing last year with 10% pricing, we're taking double-digit pricing again this year. Some of that simply because the market there is more accepting this, right now, given that the Mexican market in general has lower margins. And so, given the pressure is from agave, other players are also taking and we are too. Now as it relates to the U.S., we already have some selected price increases planned. We’re starting to see a little bit of pricing in the U.S. and indicated data on tequilas, and we will be mindful of that and push this situation you eluded to will be very mindful of and I'm very on top of, and we we'll adjust as we need to.

Yes, I mean there are so many moving parts in the world of tequila these days. It's kind of fascinating that the general consumer demand has been fantastic. The demand for innovation as we mentioned in the cristalinos at very price points, sort of ultra premium price points, and the demand for that is fascinating too, but all that demand has created to much pressure on the supply and Jane walked through all that. But it's dramatic, a business that we would have that would see the raw input costs going up by very large multiples. I mean, from low single digit basis per kilogram to sort of mid 20s, even high 20s. There is very, I mean I can't think of very many businesses but see a 5%, 6%, 7% times increase in your raw cost. So the pricing environment has to give a little bit, we have to think that it hasn’t really moved much yet in the United States as it has in Mexico, because they started from a lower base. But we do expect that the category will see some pretty meaningful increases in the near-term future. And if tariff and of the conversation then I don’t know, I don’t know where -- how significant and how long with those, what that impact will be, we're just going to be have to little more agile in our own pricing strategies and see how that plays out.

The next question comes from the line of Judy Hong with Goldman Sachs.

First, Jane, I don’t know if I missed this, but did you give a gross margin guidance for fiscal '20? And how tariff versus the input cost kind of breakout in terms of your gross margin guidance? And then just more broadly speaking, just going back to your U.S. business, I think certainly makes sense to send a bit more money on the promotional side of the equitation. I guess also I am still curious to hear kind of your thoughts on your total ad spending going down as a percent of sales this year in light of -- again when you hear your competitors raising their ad spending, 200 basis points over the last two years. Why not sort of take the year to do both, so increase promo and ad spending as a percentage of your sales more effectively? Thank you.

Let me answer your first question and I'll start on second. Lawson, you can jump in. I did provide guidance on fiscal 2020 as related to gross margin. I said, we expect another 200 basis points decline in our gross margin next year, about half of it was due to tariffs, the other half is due to input cost, partly agave related which we've been talking about this morning. As it relates to the U.S. business, you're right, we just talked about the incremental promotional activity. I think it's also important to understand what all were doing in the U.S. as it relates to our spend level. So, we are increasing our media spend, I referred to this in my conversation more broadly because it applies to so many markets, but in the U.S. alone we're increasing our media spend by over 30%. We have a lot reduced our low reach activities, the sponsorship fees and local events. We have also increased our working dollars. So, we have a fair amount of what we call non-working dollars, couple of percentage points of our total growth and we're reallocated on sort of more working dollars for the consumer facing activations. We got new creative, as we just referred to also. And so, what we're saying about our spend is going to be much more meaningful and much more effective in the U.S. as we enter into fiscal 2020. We believe it is adequate, something we have been very firm about and have talked about many, many times. Our spending is not limited to the advertising line in fact, look at our SG&A line, it happens to be larger and we believe people build brands and that’s something that is intangible asset for us that creates value. And so -- that we have people on the street working for us building our brand that coupled with our advertising investment. There is packaging and cost of goods and then we referred to the incremental promotional activity. So, we don't look at that alone and in fact I added all those pieces together, meaning the incremental spend that I am spending behind the advertising, the increase in promotional activity, the reallocation of non-working dollars, we are at or above our net sales growth in the U.S. in terms of advertising.

Yes. I mean if you go back, if you look at it over the last five years just comparing CAGAR of underlying sales to brand expense, they're about inline over a five year window. So, we have got it close right now. I mean, I do think, we continue to -- as Jane said in her remarks we have been holding tight on SG&A and trying to -- we've been reallocating these investments back towards brand expense. We came up a little bit lighter than sales this year. We have been as Jane said, we've been playing with the mix and reallocating amongst the mix and we feel comfortable that we have got at appropriate level at there right now. So 30% increase in media year-over-year is a big increase and I can't remember ever having an increase that big before, so you're going to see the Jack Daniel's trademark in front of consumer's eyeballs a whole lot more this year, this coming year than we did last year.

And Judy may be just to tag on. We’ve been doing after efficiency in SG&A for a few years now and we're really going after A&P hard this year. So those non-working dollars are really a function of renegotiating and consolidating agency fees and reallocating to consumer facing. So, what Jane was implying is that you're really getting a few extra points with A&P growth that's hidden through that reallocation.

Your next question comes from the line of Robert Ottenstein with Evercore ISI.

Great thank you very much. I'm wondering Lawson, if kind of give us your assessment of your results in tequila. I mean you've got a fabulous brand, tremendous heritage, it's great liquid, the market is doing very well, but some brands, I think, Don Julio was up about 25%. When you benchmark your results versus a brand like that and I see them as fairly similar brands. Are you investing enough? Is there enough focus? Do you have supply issues? Or is it just not as a strategic imperative? I'm just trying to get a sense because it would strike me that this would be a time in which you'd really kind of put on the gas for tequila and really expand that business significantly?

Well, I mean it’s a tough time to really put down the gas on the business because of the rapid increases on the agave cost. So, I mean, there isn’t that much supply and that which is there is very expensive. And so, we’ve been more about reallocating a little bit and I'll call allocating within Mexico itself and trying to find channels and brands that are going to deliver the highest margins. So, there’s a lot of that going on. I mean, the el Jimador itself has gone from when we bought it, it was about 150,000 cases to 650,000 cases. So, we’ve added almost a half a million cases on the brand since we bought it. And Herradura continues to grow at a nice clip, you can highlight there are few brands out there that are growing at stellar growth rates, and we’re not there and we’re trying to raise the bar and get there. But I still consider, I’ll call it double-digit sales growth on both of them in fiscal '19 is pretty good achievement. So, the business is certainly at a healthier position today than it was even five years ago.

One thing we did, just as a reminder Robert, was that we put the Herradura brand which is our high-end brand in our emerging brands group in the U.S. And so, it’s got dedicated people focusing on that along with a handful of other brands, and we have seen an acceleration in that growth this year. So, that’s in the form of people beat on the street, making calls or making sure that our distribution of the brand gets out much broader. We know we got lots of opportunities from a distribution perspective and then increasing awareness on the brand. So, that is one thing that you -- is hitting I guess if you’re looking at the A&P line, it's coming through the people and they're focused on it.

And what about premiumization of the brand, I mean you do a fabulous job with Woodford and on the whiskey side. Do you see the opportunity to premiumize Herradura maybe a little bit more and use that to deal with the agave shortage?

Yes, I mean we are going to be premiumizing. There’s two ways of premiumizing. Obviously, we’re taking prices up as we said in Mexico aggressively and we’ll see how the U.S. market trends over the next few months and quarters. But I do -- as I said, I do expect to continue to trend up. It’s also the -- I mentioned the cristalino Herradura Ultra, we're premiumizing within the mix that we have. That brand sells at a higher price point than the core SKUs within Herraduraas as an example, both in Mexico and the U.S. and it's growing very-very nicely. So you get a little bit of benefit there too.

What about acquisitions on the tequila side? Would that make any sense?

I think we got a wonderful line of tequilas from the value price all the way up to the ultra premium, if you will, because of the brand that Lawson was just talking about which is ultra, so we start off with Pepe, we've got el Jimador, we've got Antiguo, we've got Herradura and we have got the ladder covered. Now, do we have innovation going on? As Lawson said we'll continue to innovative within it -- that brings consumers in within the RTG, new mix which is over seven, nearly 7 million cases now and growing. And so we think we've got a pretty wholesome portfolio, and as tequila, they can take advantage of the growth that’s out there.

The next question comes from the line of Tim Ramey with Pivotal Research.

Jane in the context of interest expense, you mentioned agave having an impact on that. I'm wondering if you’re doing perhaps long-term contracts, like grower contracts, we would see in the U.S. for grapes, that concept applies in Mexico or that’s one of the reasons why that particular factor would be impacting interest expenses other than just inventory?

I’m not sure -- okay let me say, we said this impacted our interest expense this year. We took out new bond offerings at the end of last year if you recall. I think that is what is impacting our interest expense more than anything. You're referring to working capital but that’s not, that’s just new debt that we incurred last year.

Maybe I miss heard you on the reference to agave there.

Yes.

I don’t think there is a connection between interest expenses and agave.

Your next question is from Sean King with UBS.

Is it safe to assume that the underlying fiscal '20 sales is five to seven and operating income of three to five or includes the five months of existing tariffs and accompanying the seven months of fiscal '19 tariff? You were able to hold your fiscal '19 guidance as a higher range to the back half of last year, or if mitigation efforts are getting more difficult or there sort of other factors going forward?

It's largely driven by the higher input cost pressures that you are seeing. But you have captured everything correctly in terms of seven less than the five months, but it's really the higher input cost more than anything that are depressing on gross margins next year more than they did this year, so that’s what you are seeing.

Understood. Thank you.

A bit more investment and the SG&A won't be as beneficial as it what this year either.

Got it, great.

But not as much.

The next question comes from the line of Bill Chappell with SunTrust.

Just a question on Apple, you talked about those in the call that flavors are now as big as vodka. This will only be your only third launch and that's not even coming out until calendar 2020 and that you have also lost a lot of share to other brands by not having Apple out there. So, can you give us some more color on why it's taken so long? I don’t think with Apple or Honey there is -- it's a changing, aging or anything like that, I think it's a pretty quick process. So, I'm just trying to understand, why is it taking so long? Why is it still taking so long to get Apple out? Would you change the pace of kind of getting more flavors out so you don't lose share. And then you alluded in your prepared remarks about opportunities in gin, if you don't mind touching on that, that be great. Thank you.

Well, so on the flavor conversation. I mean, it's funny, you say why aren’t, you going faster. Internally it's always a debate as to what the pacing ought to be on these things, but, we are not -- we don't want to do is beyond that sort of the treadmill of introducing one flavor a year or whatever it might be. We believe that these things are really individual brands, that at the way we've done it has been the right way to do it, as I said, Honey continues to grow and Fire continues to grow. So, there is -- I don’t say there's not a need, but I mean we haven't felt like we had to go out and do another flavor. It's just a matter of capturing what is now pretty big business opportunity for us and one that we think can be big. And as we said, there is really no competitor outside of the United States in the Apple flavor. So, we feel pretty good and pretty confident where that's going to go. As to the gin category, it's a category we have been looking at for several years now. We continue to try to figure out how we're going to play that and news will be coming out at some point. We hope the news will be coming out some point and how may want to talk about it. It's a category that continues to grow very nicely and we continue to be on the sideline. So, it's something our groups are looking at.

And our final question for today will come from the line of Nik Modi with RBC.

Hey. Good morning. This is Russ Miller on for Nik.

Morning, Russ.

Good morning. Given the first quarter 2020 underlying sales growth comp. This is specially cost relative to the balance of the year. Just wondering if you could provide any additional guidance on Q1? And as a follow-up, wondering if you could comment on the premise sales growth trends relative to the rest of business and what your expectations are for on premise looking forward. Thank you.

I'll talk about phasing a bit. Glad you brought that up. Just to remind everyone that last year's first quarter top line was particularly strong, that's because it benefited from the volume in Europe largely, from the tariff -- tariff related buying. In the second quarter, it was pretty soft quarter because there was so much give back. So, if you think about the first half of the year, I think that's probably a better way to look at last year's first half. So we're going to definitely have no worries in the first half of this year going up against that tough comp top line at a global level. So, I'd like to think about it as a first half, second half if you will. So, I think our first half sales growth will be in the range that we just talked about and more in our underlying growth rate that we referred to today, in the 6% range. And our back half of the year will benefit from the contribution somewhat from Apple. When I think about my bottom line, the first half will be a tough comparison because of the pressures related to first half from tariff and input costs. You won't have the tariff when we get to the second half. So, you're going to see lower operating income growth, very low operating income growth because of that in the first half, second half you’ll see that accelerate. So I hope that gives you a little bit of color there.

Sure just to confirm, if you don’t mind that was helpful, but Q1, could that growth in fact be as high as 6% off the tough comp?

Going up against the 9% growth. I don’t expect that it will be. So strong, last year's first -- yes the first quarter.

And lastly any color on on-premise that you could share?

On premise business in the U.S. remains…

Continues to grow, but it’s a low single-digit growth. So, it’s a little bit -- if you’re just looking at Nielsen trends for an example, overall market trends are going to be I think we said a point lower than that, something like that. But it’s growing, it’s not in decline, but it’s just not as fast as they offer us.

Like it used to be years ago.

Thanks Russ. Thank you, Lawson and Jane, and thanks to all of you for joining us today for Brown-Forman’s year-end earnings call. And please feel free to reach out to us if you have any additional questions and have a great summer.

This does conclude today’s conference call. We thank you for your participation and ask that you please disconnect your line.