Bioceres Crop Solutions Corp. (BIOX) Q3 2022 Earnings Report, Transcript and Summary

Hello, everyone, and welcome to today's Bioceres Crop Solutions Fiscal Third Year -- Third Quarter 2022 Financial Results Conference Call. My name is Emma, and I'll be coordinating your call today. [Operator Instructions] I will now pass the call over to Rodrigo Krause to begin. Please go ahead.

Thank you. Good morning, everyone, and thank you for joining us. Presenting during today's call will be Mr. Federico Trucco, our Chief Executive Officer; and Enrique López Lecube, our Chief Financial Officer. Both will be available for the Q&A session. Before we proceed, I would like to make the following safe harbor statement. Today's call will contain forward-looking statements, and I refer you to the forward-looking statements section of today's earnings release and presentation as well as in our recent filings with the SEC. We assume no obligation to update or revise any forward-looking statements to reflect new or changed events or circumstances. Also, please note that for comparison purposes and a better understanding of our company's underlying performance, and in addition to discussing as reported results during our presentation today, we will discuss comparable results which exclude the impact of hyperinflation accounting in Argentina. Additional information in connection with the application of the rule IAS 29 can be found in our earnings report. Finally, this conference call is being webcast. The webcast link is available at the Bioceres Crop Investor Relations site. At this time, I would like to turn the call over to our CEO, Federico Trucco. Thank you.

Thank you, Rodrigo, and thanks to everyone on the call for joining us today. Please turn to Slide 3 for a quick overview of the quarter's main highlights. Our third fiscal quarter has been historically our weakest and less eventful quarter for various reasons, most importantly because it overlaps with the Latin American summer, not an important planting period for any one product. The third quarter of fiscal year 2022, which we are currently reporting, deviates from this historical rule. And this is not only because of the great momentum we continue to observe in ourselves, with revenues increasing 72% on a comparable basis, but also and significantly due to the business development and regulatory milestones that were achieved during the period and subsequently thereafter. As we announced in March, we are pursuing a transformational merger with Marrone Bio Innovations to become an undisputable leader in the ag biological space. And recently, in April, we have received the long-awaited regulatory green light from China that allows us to move HB4 soy into its commercialization phase. With regards to the MBI merger, we were able to file F-4 documents with the SEC this last Monday, and we continue to be on track for a first quarter closing in fiscal 2023, that is, between July and September of this year. In terms of HB4 Soy, we are today providing guidance for fiscal year '25, where we expect HB4 Soy to contribute between $20 million and $25 million of incremental EBITDA. We expect this contribution only after 2 prior commercial seasons in Latin America, as we will describe in more detail in a few minutes. Outside from these important milestones, we are taking advantage of the current momentum in wheat interest to advance commercial agreements for HB4 Wheat within Latin America and expand outside of the region. Among this, our wheat subsidiary, Trigall Genetics, has reached a preliminary understanding with S&W Seeds of Australia to acquire a majority of its wheat printing program and assets. This agreement is reached at the time when a positive recommendation is obtained from regulators in Australia regarding the use of HB4 Wheat in food and feed. We'll discuss this and other HB4 Wheat-related developments throughout the presentation today. Please now turn to Slide 4 for a deeper discussion on our current HB4 Soy highlights. The Chinese approval for HB4 Soy does 2 immediate things. First, it allows for unrestricted commercialization of HB4 Soy in Argentina, our most immediate market. And secondly, it releases our third-party licensees from contractual restrictions to initiate launch activities in multiple geographies. We estimate an addressable market of approximately 35 million hectares for HB4 Soy in the U.S., Brazil and Argentina, just to focus on the most important production geographies currently enabled. We believe that given the status of our pipeline and that of our licensees, we can achieve a 15% penetration of this opportunity in Argentina, 4% in Brazil and have an initial 50,000 hectares farmed in the U.S. during the 2024-25 crop season. All combined, we estimate an incremental EBITDA contribution of $20 million to $25 million for fiscal year '25, with most of these EBITDA and associated revenues resulting from our proprietary channels. For a more detailed overview on a year-by-year basis, please turn to Slide 5. In this slide, you can see the number of varieties expected to be launched during the next 3 years and how many of these varieties are being developed by us compared to our licensees. We expect each variety to cover between 100,000 and 300,000 hectares on an annual basis once introduced. So not probably on year 1, but most likely as of year 2 and forward. Finally, on HB4 Soy and turning to Slide 6. We are 52% done in harvesting the current season and expect close to 70% of the resulting inventories to meet initial seed quality standards. Nonperforming materials and out of standard inventories will be commercialized as grain. We'll continue to pursue approvals in significant export markets other than China, and we expect to have clearances in place in countries accounting for 75% of the soybean trade out of the Americas by fiscal year '24. Please turn now to Slide 7 for an overview of some major developments regarding HB4 Wheat. As you may know, the current conflict in the Ukraine-Russia region is significantly affecting the global wheat market. The increasing price of wheat is also translating to increased interest in wheat breeding and production solutions, and we are today benefiting from our unique technology offering for this crop. As I indicated at the beginning, Trigall Genetics has reached a preliminary understanding with S&W Seeds of Australia to create a joint entity, Trigall Australia, that will own the breeding program and assets that S&W bought from Corteva Agrisciences back in 2019 and further developed until today. Under the current terms, Trigall Trial Australia will be majority owned by Trigall Genetics, our joint venture with Florimond Desprez. We have also reached a collaboration agreement with the African Agricultural Technology Foundation, based in Kenya, to initiate the path for HB4 Wheat into Sub-Saharan Africa. We'll be initially testing HB4 performance in selective environments and initiate trait introgression into locally adapted materials. To existing approvals for the use of H34 Wheat Argentina and Brazil, we have added regulatory clearances or positive recommendations in Colombia, Australia and New Zealand and expect several other positive regulatory news in the coming months and into next year. In Slide 8, you will find some additional information regarding the opportunity for HB4 Wheat in Australia and the rationale for the establishment of Trigall Australia by acquiring S&W wheat assets in this country. To put this into perspective, Australia is a bigger wheat market than Latin America today. It is a production area that is often and severely affected by drought events. And it has established an efficient endpoint royalty system that facilitates collections and quick technology adoption. All these factors make it a very logical next step in our internationalization process for this technology. For a brief update on the status of the HB4 Wheat program in Latin America, please now turn to the next slide. Wheat planting in Argentina will start in the next few weeks, and we are estimating HB4 program sales of between $10 million to $12 million in the current season. We have a little over 100,000 tons of wheat still in inventory, and we have already recovered over $4 million of working capital by selling non-seed inventories as grain. When we do this, we operate with selected processors under our identity-preserve scheme to minimize interference with conventional wheat commercial channels. Today, we are operating with 12 different processors with aggregated capacity of close to 700,000 tons, a capacity that far exceeds our remaining non-seed inventories or grain processing needs that may result from the harvest of this next crop. Let me share with you some interesting data points. Since the approval of HB4 Wheat in Argentina, 120 optical testing devices were deployed to ports and mills to detect HB4 presence at points of grain delivery. In total, over 4 million tons were tested. Despite some anecdotal false positives, no formal complaints or corroborated positive detections have been communicated to us as of today. We continue to pursue regulatory clearances in important wheat export destinations as we further internationalize this very exciting opportunity. Finally, on my part and before turning the call over to Enrique, please turn to Slide 10 for an overview of an updated time line regarding the merger transaction with MDI. As I indicated before, we have filed F-4 documents with the SEC this past Monday, and we expect the SEC review to take between 6 to 8 weeks. With SEC approval, we would then have 4 to 5 weeks before the MBI shareholder meeting can be convened and the transaction formally approved. This gives us today between 10 to 13 weeks before closing, and this is consistent with our prior expectations on this matter. Let me now pass the call over to Enrique to go over the numbers for our third fiscal quarter. Enrique López Lecube: Thank you, Federico. Good morning to everyone, and thank you for joining us today. Please turn to Slide 11 to get started with the financial review of the quarter. Following with our latest top line performance, we saw another very strong quarter for sales. Compound revenues for our third fiscal quarter grew 72% year-over-year, reaching $60.1 million, a record-high third quarter revenue number for us. It was not so long ago, probably 2 years or less, that a $60 million quarter only took place in the high season and not in a traditionally low season quarter like this one. Growth was driven by higher sales across all product categories of the Crop Protection segment, combined with continued momentum in our micro-beaded fertilizers business. I will provide more details on what drove growth in a minute, but it is important to note that this great quarterly performance continued to build on top of what we had accomplished in the first half of our fiscal 2022. Year-to-date revenues totaled $215.2 million, a 72% increase versus the year-ago period. And LTM revenues reached $287.5 million, a 63% increase compared to the LTM metric from the third quarter of fiscal 2021. No doubt, an outstanding performance of our business up to this point. Let's please move on to the next slide for a more detailed look at growth drivers, comparable gross margins and the impact of IAS 29 on reported revenues. The Crop Protection segment was the biggest contributor to sales growth this quarter with an impressive 118% gain, a 16 -- sorry, a $19.4 million increase, that grew comparable revenue for the segment to $35.8 million. We saw higher third-party product sales in Argentina and a strong increase in sales of adjuvants across South America as many farmers decided to purchase adjuvants in advance to ensure availability in light of the current global supply chain constraints. Difficulties to ship active ingredients out of China have driven crop protection prices higher, creating a positive environment for our sales teams in this segment. Crop Nutrition also had a solid performance with revenues increasing by $5.7 million to $20.8 million, a 38% growth rate. As I mentioned, micro-beaded fertilizers continued to push sales higher due to positive market conditions. Competing commodity fertilizers, MAP and DAP, continued to experience price increases during the third quarter due to high uncertainty around supply in the agricultural markets, which stimulated demand of our product and further enhanced the value proposition. We have taken a conservative pricing strategy by increasing prices at a slower pace than commodity phosphate in anticipation of MAP and DAP prices turning lower at some point, given that we are currently seeing historically high fertilizer prices. The Seed & Integrated Products segment remained stable with overall comparable revenues at $3.5 million for the quarter. Seed treatment packs sales increased in Argentina and Europe, but this growth was offset by lower seed sales in Argentina due to delayed wheat planting decisions by farmers. Variances in comparable gross margins for each segment are mostly attributed to product mix rather than by a shift in profitability of the different product categories, which remained fairly stable as sales grew. Crop Protection decreased from 37.7% to 35.9% as growth in sales of lower-margin seed protection and third-party products outpaced growth in adjuvants during the quarter. Seed & Integrated Products rose by 130 basis points to 52.2% on higher contribution of seed treatment packs to the mix. And finally, Crop Nutrition fell slightly from 53.2% to 51.6%, given the higher growth contribution of micro-beaded fertilizers which have lower margin than in adjuvants. To summarize, growth in sales was achieved on stable margins, which is something on which we always focus. Before we turn to the next slide, it is important to note that IAS 29 adjustments have become increasingly material over the last few quarters as the inflation rate in Argentina outpaced depreciation of the local currency, generating a distortion in the financial statements of the operating subsidiaries of the country that are then consolidated into BIOX's financials. For example, while we reported revenues in the third quarter of fiscal 2021 were only $1.2 million higher than comparable revenues, this quarter's gap from IAS 29 adjustments was more than $9 million. Let's now please turn to Slide 13 to review gross profit for the quarter Total comparable gross profit grew by 59% year-over-year, reaching $25.4 million, a record-high third quarter figure and in line with our top line performance. Crop Protection gross profit rose by $6.6 million, reaching $12.8 million, up 107% year-over-year. Crop Nutrition contributed $10.7 million to comparable gross profit, increasing 34% or $2.7 million. And Seed & Integrated Products generated $1.8 million in gross profit, almost the same as last year. As I mentioned, individual product categories maintained stable gross margins. The overall comparable gross margin decreased from 45.6% to 42.3% as segments with lower gross margins saw greater expansion, mainly Crop Protection. While segment mix explains the variance in comparable gross margin, it is important to note that in this particular quarter, IAS 29 adjustments heavily affected the reported gross margin figure. While IAS 29 application expanded revenues $9.4 million above the comparable figure, it has the opposite effect on gross profit, contracting the reported metric by $1.7 million versus the comparable gross profit. Importantly, adjusted EBITDA calculation is based on the reported gross profit figure affected by IAS 29. Distortion on financials from the application of IAS 29 has become increasingly significant as depreciation of the local currency in Argentina has lagged the monthly inflation rate by 41% over the last 15 months, an unusually long period of time for these 2 variables not to converge. Please turn to Slide 14 to take a closer look at EBITDA drivers over the quarter. Adjusted EBITDA totaled $4.8 million in the third quarter of fiscal 2022, down from $6.9 million in the year-ago quarter. I would like to call your attention to a few concepts worth keeping in mind when considering EBITDA for the quarter as it might not give you the best picture of the underlying performance of the business, which was outstanding in terms of revenues and gross profit. First, our third quarter is seasonally slow, which tends to amplify smaller items that would probably have less of an impact on high season quarters. Furthermore, our portfolio is heavily biased towards planting activities, which many times, creates phasing issues by uncoupling expenses from corresponding profits. Particularly in this quarter, freight and haulage expenses were unusually high as we made the decision to anticipate shipment of high-margin products closer to end markets as a precautionary measure to address uncertainty in supply chains. Freight expenses this quarter rose $1.6 million, a 165% increase versus last year, without the corresponding profits that we expect to materialize in the fourth quarter. Second, as we scale up HB4 hectares, we are incurring prelaunch expenses and ramp-up costs that were much smaller or not even present in the year-ago quarter. particularly in the third quarter of the current fiscal year, HB4-related costs and expenses increased to $2.3 million from $0.5 million as hectares managed under the HB4 program rose almost threefold, and we recognized no profit from HB4 Wheat that are expected to begin in the fourth quarter. And lastly, the above mentioned 41% lag of the depreciation rate of the Argentine peso versus local inflation rate generated 3 negative effects on quarterly EBITDA: One, $1.7 million IAS29 negative adjustment to reported gross profit on which EBITDA calculation is based; two, IAS 29 adjustment to expenses; and three, a nominal increase in SG&A incurred in the country where we house our manufacturing and administrative functions. The last 2 together account for $2.3 million of the total $7 million -- $7.8 million in SG&A increase for the quarter. While these 2 macro variables, Argentine effects and inflation, normally average out, when they don't, it creates significant headwinds as this particular quarter shows with a combined $4.1 million impact to our EBITDA. Let's please turn to Slide 15 to briefly review our financial position before turning the call back to Federico. Total debt has been increasing in line with the growth of the business. Net debt by quarter end was $163.7 million, a 3.06 net debt to LTM adjusted EBITDA ratio. Total financial debt reached $205 million, increasing from $183.4 million in the third quarter of fiscal 2021, which explains higher LTM financial expenses on a relatively stable cost of debt. Subsequent to the quarter's closing, we announced the conversion of 75% of the outstanding amount of the convertible notes issued in 2019, reducing our short-term debt by approximately $37 million as we prepare for 2 major events: The closing of the merger agreement with MBI and the commercial launch of HB4. Following the recent soy approval in China and progress made in expanding our wheat footprint to Australia, it is reassuring to have now set targets for HB4 Wheat and Soy that imply a contribution of $35 million to $45 million of additional EBITDA over the next 2 to 3 years that we'll build on top of a healthy and growing baseline business. This concludes my remarks for today. Federico?

Thanks, Enrique, and I think we can now open up the call, operator, for Q&A.

[Operator Instructions] Our first question today comes from Ben Klieve from Lake Street Capital Markets.

All right. And congratulations on all the developments here. I have a couple of questions on HB4 Wheat as there's been an awful lot of news here. Regarding Australia, which is a really exciting development for a lot of reasons, I think you mentioned you said an acquisition of S&W's wheat varieties. Are you making any cash payments to S&W for this? Or is the implication here that S&W is going to be contributing its lead assets to the joint venture on a noncash basis?

Ben, it's great to have you here in the call, as always. So it's a combination of cash and receivable ownership for S&W into the new entity as consideration for the assets that we are receiving.

Got it. Got it. Okay. And then my second question on HB4 Wheat in Australia is, has there been any work done on developing this kind of under the radar historically? I mean, have -- between Bioceres, Florimond and S&W, have you been working on development work prior to this announcement? Or are these efforts really starting today?

So we've been working under the radar in Australia for some time. We've done this initially with a partner helping us on the regulatory front. And when we decided that to move forward in this particular geography, and that was a joint decision with Florimond Desprez, our JV partner, we immediately engaged with S&W, which we knew acquired the Corteva seed assets, wheat seed assets, a few years back. And worked towards this, that we are announcing today. It all sort of came together. At the same time, we received news from the New Zealand and Australia regulatory body recommending an approval for HB4 use in feed and food within these 2 countries. So things are coming together in a nice way in a market that is, as I indicated, bigger than Latin America.

Got it. Got it. That's helpful. Regarding soy, it looks like a lot of progress here. Great to see the 75% levels which you noted converting to inventory. The thing that was the most notable to me, that you talked about expectations here for kind of a modest launch in the U.S. in 2025, which is a little earlier than I would have anticipated. Can you talk about -- can you provide just a bit of context around that? I mean, are you -- is your intention here that you think you will be a seed company selling seed in the U.S. in 2025? Do you think this is going to be the royalty business? Do you have any geographies lined up that you're going to launch? Any detail there would be helpful.

So look, we are looking forward to the combination with Marrone, and we do expect to have some of those capabilities become available for us to develop an organic strategy, particularly in the area where we believe HB4 to be most valuable in the U.S., which is kind of Dakota, Minnesota and Southern Canada -- Central Southern Canada part, where we expect the technology to deliver significant yield increases. Now we are realistic in terms of our current status in terms of germplasm assets. So what you see there under our proprietary strategy is coming together by us being able to in-license genetics from existing participants in the U.S. market. So we're not able to disclose today who the providers are, but we were able to secure genetics that are locally adaptive so that we can have these earlier opportunity. Now we understand that, for us to be able to fully penetrate this market, we need to develop these third-party channels, like we are doing in Latin America. I mean, even though initially we take sort of a lion's share of the bigger share of the effort, we do expect third-party, well-established soybean seed companies to generate royalties for us in the medium- to longer-term strategy. And in the U.S., that is critical. So we want to be the first-to-market channel. We are incorporating third-party germplasms to be able to do so. And hopefully, as we validate the U.S. as a valid market for HB4 Soy, we will have third-party seed companies doing the work like they are in Argentina and Brazil.

Got it. Got it. Very helpful. My last question, and then I'll get back in queue. Now that HB4 is -- it's here. I'm wondering if you can help us a bit with kind of modeling the seasonality. How much revenue from wheat and soy do you expect will be concentrated in your fourth and second fiscal quarters, respectively, versus kind of being extended throughout the entire year? Enrique López Lecube: Ben, this is Enrique. Thanks for joining the call. Look, I think that, obviously, these are products that are tailored for planting. And while Argentina and Brazil remain to be an important part of the revenue stream and profits of this particular initiative of the company, I think, that our fourth quarter will be probably when we recognize the revenues coming from wheat. It might fall -- some of that might fall into the first quarter of our fiscal. And the second quarter of our fiscal is when we're going to get most of the revenues coming out of soybean, and that's the summer crop planting season in Latin America. This will begin to even out when we start getting revenues from the U.S., but I would expect our Q4 and Q2 to be where we get most of the revenues from HB4 Wheat and Soy, correspondingly.

Our next question today comes from Brian Wright from ROTH Capital Partners.

Congrats on all the progress. I wanted to just get a sense, did you speak about the revenue basis for the EBITDA for HB4 Soy in 2025?

So a few things to consider there. Obviously, the revenue from licensees or royalties coming from third parties will tend to be small, but with a high gross margin contribution because obviously, there are no cost of goods or relatively small cost of goods to that revenue; compared to the proprietary revenue, where we are selling the fully integrated seed product. And there, we will be operating on the gross margins you've been seeing from the HB4 program already. I will let Enrique complete the answer in terms of what to expect on a per hectare basis, perhaps, which is I think probably the best way to model total revenues for fiscal year '25. Enrique López Lecube: Brian, so that is a good question. That's why on the presentation, we provided an overview of what we think will be the split between proprietary channel and non-proprietary channels. So I think that, for what it's worth, a back of the envelope calculation that you can do is that a nonproprietary channel sale would bring probably 1/3 of the revenues than a nonproprietary channel would bring, but as Federico said, with a much higher margin as we are only accounting for royalty. So cost of goods sold would rather low. So I think that 1/3 of our revenue for nonproprietary channel versus proprietary channel, it's a good back of the envelope or rule of thumb to use.

Great. I just want to make sure I understand that. So 1/3 of, if it were proprietary? Or split amongst the 2 buckets? Enrique López Lecube: So let me put it in numbers. So if we are pricing a bag of soybeans, some $30 to $35, and that would mean done on an nonproprietary channel, we would be charging about $10.

Perfect. Got it. Got it. And then if I could, just one real quick detailed follow-up. Could you give us the exact percentage on the Trigall ownership for Australia?

So obviously, that is still to be finalized. But we will have a controlling interest of 60% on day 1, jointly with Florimond Desprez, and the ability to increase that up to 80% according to the current terms.

[Operator Instructions] Our next question comes from Kemp Dolliver from Brookline Capital Markets.

First question, just continue with Australia. S&W reports that Australia represents about $24 million in annual revenue, but I'm pretty sure that includes pieces of the business that will not be in the JV. So first question is, can you roughly size the revenue -- incremental revenue coming in from the joint venture?

Sure, Kemp. So thanks for joining the call. Those revenues reported out of Australia are probably mostly from pastures and sorghum and other crops. Wheat revenues, if I recall correctly, at less than $1 million from their existing operation. So they're not too significant initially. But obviously, that will give us locally adapted germplasm on which we can breed HB4 right away, and have that technology become available in the next few years. We believe that by fiscal year '25, we're likely to get cultivation clearance, and probably thereafter, being able to launch that commercially in-country. So not meaningful day 1 from a revenue perspective from the conventional business that currently exists.

Super. And you've made a couple of important moves in the last few months that expand your footprint for essentially distribution and marketing purposes. Are there any other markets of consequence on your radar screen that you would like to enter in similar fashion?

Look, obviously, Australia is, from a wheat perspective, is a very logical next step for us. In terms of business opportunity for wheat, the U.S. is one that we would like to put online sooner rather than later for wheat. I think we're likely to do something similar to what we are doing in Australia at a second stage, and that would be our sort of highest priority outside of what we are currently announcing today.

Okay. I'll ask about one market in particular. So in addition to approving HB4 Soy for import in the last couple of months, food security has become a high priority for the Chinese government. They've started to loosen their GMO rules for domestic production. You have a partner there, at least, who has helped you through the regulatory process. Do you see opportunity in China in the next couple of years for domestic growers for HB4 Soy? And possibly wheat, but I think soy is the bigger concern to them.

Yes, definitely. I think even though that's been kind of not in our -- it's something that is not in our immediate plans, I think that the current situation in China, the recent approval of HB4 for feed and food and importation and the growth that we're seeing in our Chinese partner that is becoming a significant player in the biotech sphere within the country, I think, allow us to be more optimistic about the possibility of bringing this technology into China. And I think that you will probably see that materializing in the form of a joint agreement or with a local partner of significance, and not something that we are likely to do ourselves on a stand-alone basis.

Super. And my last question is, in the past, you've given capacity utilization data for the micro-beaded fertilizer plant. Do you have an update on that? Enrique López Lecube: Kemp, this is Enrique. So yes, we are. As we measure use of installed capacity, we are today at roughly 65%. Now you need to bear in mind that, that considers sort of like the annual capacity of the plant. When you go into high season like now, what I can tell you is that we are running at full capacity today because we are building inventories for the high season in the summer crops planting in Latin America and also for winter crops planting now. So today, we're running at full capacity. If you annualize that, it's around 65%. But that 65% doesn't tell the reality because it spreads out capacity throughout the year.

We have no further questions, so I'd like to hand the call back for closing remarks.

Thank you, operator. Well, I mean, I think that it's very rewarding for us to see that the momentum that we've been reporting in the last few quarters continues throughout the current quarter. We are moving forward into closing a fiscal year that I believe will be record-setting in many ways. And not only sort of reporting these good numbers, but also finally having all these regulatory clearances that were pending materialize. So we achieved the Brazil approval last year that basically enable us to launch HB4 Wheat in Argentina. Earlier today, we got news that the Ministry of Agriculture here has fully released the commercialization of the first HB4 varieties, so that there are no doubts as to what the Brazil approval means in terms of us being able to bring this forward and materialize the revenues that we are estimating today in the call. And also China that's been long awaited, took us more than 6 years to get to where we are today. So like someone said, nothing is fast in agriculture. But we are, today, monetizing or capitalizing or showing some of the results of investments and decisions we took many years back. And we are very proud of where we are. We are very happy with where we're going. And hopefully, once we get done with the merger with MBI, all of these will become even clearer to investors in the space. So no more than this. I hope everyone can have a great week and looking forward to staying connected as needed.

This concludes today's call. Thank you all for joining. Have a lovely rest of your day.