Good morning and welcome to the Crocs Fourth Quarter 2023 Earnings Conference Call. All participants will be in listen-only mode. [Operator Instructions] After today's presentation, there will be an opportunity to ask questions. [Operator Instructions] Please note this event is being recorded. I would now like to turn the conference over to Erinn Murphy, Senior Vice President of Investor Relations and Corporate Strategy. Please go ahead.

Good morning, everyone, and thank you for joining us to discuss Crocs Inc. fourth quarter and full year results. With me today are Andrew Rees, Chief Executive Officer; and Anne Mehlman, Executive Vice President, incoming Crocs Brand President and current Chief Financial Officer. Following their prepared remarks, we will open the call for your questions, which we ask you to limit to one per caller. Before we begin, I would like to remind you that some of the information provided on this call is forward-looking and accordingly is subject to the Safe Harbor provisions of the Federal Securities Laws. These statements include, but are not limited to, statements regarding our strategies, plans, objectives, expectations and intentions including our financial outlook. These statements involve known and unknown risks, uncertainties and other factors, which may cause our actual results, performance or achievements to differ materially. Please refer to our annual report on Form 10-K and other reports filed with the SEC for more information on these risks and uncertainties. Certain financial metrics that we refer to as adjusted or non-GAAP are non-GAAP measures. A reconciliation of these amounts to their GAAP counterparts is contained in the press release we issued earlier this morning. All revenue growth rates will be cited on a constant currency basis unless otherwise stated. At this time, I will turn the call over to Andrew Rees, Crocs Inc. Chief Executive Officer.

Thank you, Erinn, and good morning, everyone. Thank you for joining us today. 2023 was a record year for the Crocs Enterprise and we're starting off 2024 from a position of strength. Our teams are focused on continuing to drive market share gains and sustainable profitable growth. We ended the year strong delivering better than expected fourth quarter. Let me start by sharing a few highlights from the full year of 2023. Total revenues grew 12% year-on -year to almost $4 billion dollars, driven by 19% direct-to-consumer growth at the enterprise level. Crocs brand revenues surpassed the $3 billion mark, increasing 14% versus last year. HEYDUDE Brand revenues were approximately $950 million and delivered over $200 million in operating income. We expanded our gross margins and once again delivered industry-leading margins with adjusted operating margins of almost 28% exceeding our guidance. We grew our adjusted diluted earnings per share by 10% versus last year to $12.03. Our strong cash flow generation allowed us to repay $666 million of debt as we resumed our share repurchase program during the year. Finally, we're pleased to see the Crocs Inc. achieved the number 20 spot on Fortune's 2023 top 100 fastest growing companies. Before I provide strategic updates by brand, I want to speak to the recently announced executive transitions. Michelle Poole, Crocs’ Brand President will be retiring from the company following a distinguished 32-year career in the footwear industry, the last decade of which she had a tremendous impact on Crocs. Michelle Poole maiden her role through early May and transitioned to a special advisor through early 2025. In keeping with our succession planning. I'm pleased to promote our current CFO Anne Mehlman to Crocs Brand President. Many of you have the opportunity to work closely with Anne and know she brings…

Thank you, Andrew, and good morning, everyone. I'm very pleased by our fourth quarter results, which exceeded the high end of our guidance across all metrics. We generated $960 million in consolidated revenues, growing 1.5% over last year led by the Crocs brands. We delivered top-tier profitability with adjusted gross margin up 240 basis points to 55.7% adjusted operating margin of 24.1% and adjusted earnings per share of $2.58 ahead of our guidance of $2.05 to $2.35. Our strong profitability and focus on net working capital enabled us to repay $277 million of debt in the fourth quarter. We also repurchased $25 million of stock in the fourth quarter at an average cost of $86.34 per share. As discussed earlier in January, at the ICR Conference, we made a change to our segment reporting that will now be reflected in our 10-K. Our reportable operating segments will now be the Crocs brand and the HEYDUDE brand. We plan to continue sharing our progress against our strategic growth pillars, key country call outs and channel dynamics. Turning to the Crocs brand in the fourth quarter. Revenues were $732 million, growing 10% relative to prior year, driven by strong DTC growth of 12% and wholesale growth of 7%. Brand ASPs were up 12% to $26.76, led by both channel and product mix, higher international pricing and lower discounting. The brand sold 27 million pairs of shoes, a decrease of 1% to Q4 last year or up 5% excluding the impact of the termination of our African distributor. For the year, the brand sold 120 million units of 3.5% versus last year, an ASP growth of 10%. Now, let's review the Crocs brand highlights by country and channel. In the quarter, North America revenues are $471 million were up 3% from 2022, a…

Thank you, Anne. Crocs Inc. had a record breaking year in 2023. As we move into 2024, we are on the offense. I'm proactively making the decisions to invest incrementally in our business to set us up with continued durable market share gains, while delivering top-tier total shareholder returns. At this time, we'll open the call for questions.

[Operator Instructions] And our first question will come from Tom Nickik of Wedbush Securities. Please go ahead.

Hey everybody. Thanks for taking my question. I want to ask about HEYDUDE, I know you gave some of the reasons why we should expect better performance from HEYDUDE over the course of the year, but it seems like you're kind of digging yourself into a pretty big hole in Q1 and you kind of need a pretty significant amount of reacceleration in the remainder of the year. I guess kind that the confidence in that reacceleration stems from order books or like feedback you gotten from wholesale partners and I guess just on the wholesale front, I think obviously last year was a much choppier year than you would expected for the HEYDUDE brand and I guess like, whatever the wholesale partner seen lately that's gotten a more comfortable to help drive that reacceleration and hold it in HEYDUDE brand that that you are expecting.

Yeah. Thanks Tom. Yeah, I think I'll hit the start of this and Anne can pick it up at the end with a few set of points around how we think of the year will play out for HEYDUDE. So, I think the first thing you've got to do is you've got to separate sell-in from sellout, right? So, yes, I absolutely - you can see that the HEYDUDE brand has been choppy from us from a sell-in perspective and didn't play out as we thought it would during the full year. And you heard us say on our Q3’s call talk about how we're going to pivot or how we pivoted some of our kind of strategic actions. But if you kind of step all the way back to sellout and the consumer takeaway that we see for the brand, because that is what our wholesale partners experience right? So I think we can see a few things that are very, very clear. The underlying sell-out for the HEYDUDE brand has been strong, right? It is a top performing brand for many of our wholesale partners and it ranks highly in that brand stack. The HEYDUDE brand during 2023 gained market share in the fashion - the fashion casual category actually substantial market share we believe based on the [Indiscernible] data of about 200 basis points. So it was one of the larger market share gainer and that that's in terms of consumer takeaway. And then we can also see that underlying PTC business and that we've changed some pricing strategies and dynamics and I think easy business which is causing us to give up some revenue, but also to drive higher margin. So, in essence, what we see is we kind of read through to the consumer that…

Yeah, and Tom, just to give you a little context on the shape and a little bit more detail, so, embedded in our full year guidance of flat to slightly up for HEYDUDE, we are assuming that wholesale right now is down for the year in our guidance. Although we do assume it improves every quarter throughout just as we look at the trajectory. In Q1, we would expect a similar channel dynamic to what we saw in Q4. And then, we really start to see the benefits of retail contribution start to impact that in Q2 and beyond. So I would say ‘24 really about from a wholesale perspective focusing on sellout as Andrew mentioned, making sure we have the right inventory in the market and letting that really be a pull market and wholesale revenue will be what it is and that's incorporated into our guidance.

And then a quick follow up on HEYDUDE. Just where – sorry if you mentioned during the prepared remarks and if I missed it, but where are we at in terms of cleaning up the gray market and all that?

Yeah, I think we're making great progress. Yeah, we see, substantial dips in the gray market from sort of earlier in ‘2'3. We're not done yet. We think it will take through the first half of ‘24 to complete that. But certainly solid progress.

Okay. Thanks very much, best of luck this year.

Thank you.

The next question comes from Jonathan Komp of Baird. Please go ahead.

Yeah, good morning. Thank you. I want to ask about Crocs North America. Could you just share your current thoughts on the health of the business? Any thoughts on the trajectory in 2024 here and maybe include with that Jibbitz in your view there? I know you mentioned penetration increases for the year. And then just one separate question more for Anne. As we think about the margin guidance for the year, it looks like you're implying pretty significant SG&A deleveraged for the Crocs brand. I wanted to see if you can give any more color there if that's the case and further give detail on what's driving that? Thank you.

Yes, Jon. So I think the Crocs brand continues to be very well positioned in North America. Obviously, it's our largest business and it is a scale business. We have substantial market share and we are well penetrated from a wholesale perspective from a retail perspective and from a digital perspective. But we do see we said we were very happy with the performance of the Crocs brand in the market in ‘23. We see, we are very positive I would say indications of continue to support from our wholesale partners. We have a strong pipeline of product innovation that will bring to market. We have a strong pipeline of licensed products collaborations that will bring to market during the year. In fact I have spent most of yesterday afternoon reviewing new products. So super excited about that. So I think the brand is well positioned. I think it also does I know as you rightly call out, we do think we have incremental penetration opportunities for Jibbitz. We see the consumer dynamic with personalization been incredibly positive as you saw in ‘23 it grew above the overall growth of the business and gained penetration. We think we see opportunities in the wholesale market where, look at it is a different more difficult product to display and sell in the wholesale market, but we have sort of creative solutions that we will be testing and rolling out. We also bring in the timelines in for Jibbitz dramatically. So that we can respond to I would say kind of social friends much more quickly. So we're super excited about using personalization to create ongoing consumer engagement.

Yeah, and just as a reminder, that North America in 2023 grew 8.3% on a constant currency basis and 3% in Q4. So pretty good results out of the North America scale Crocs business. I think from an SG&A perspective as we talked about it at ICR, we are going to invest some of our margin improvements in SG&A this year. We think it's really important and that goes for both brands. Just to give you context, we do expect higher SG&A dollar growth in the first half versus the second half because we're still in anniversaring during some larger investments on both brands that we meet in 2023. So SG&A growth is up mid-20% in both Q1 and Q2. So it’s something that to keep in mind and why we're not going to guide specifically from both brand perspective on investments - the investments that we're making across the board are really on the marketing side, talent in both brands. On Crocs, it's really focused on our international markets, which we expect to drive the growth this year. And then on HEYDUDE, some of that is related to our outlet store investment and that's the biggest pieces and in some technology associated with both brands.

Okay. Thanks, again.

Thanks, John.

Next question comes from Rick Patel of Raymond James. Please go ahead.

Good morning, everyone. Congrats to Anne on the new role and all the best in the show on your new chapter. Just wanted to ask a question about the long-term potential for growth. So, with total revenues being guided up 3% to 5% percent here. How should we think about the potential to hit $5 billion of revenue by 2026? Just hoping you could add some color on the building blocks there.

Thanks, Rick and I assume you are referring to the $5 billion for Crocs that we guided some years ago.

Correct.

Yeah. Okay. So, yes. As I think, sort of number of years ago we guided we thought there's a – the Crocs would be a $5 billion brand and I think at that point we set out we thought I could happen by 2026. I think where we are today is, we absolutely still firmly believe the Crocs is a scale business, the Crocs brand and can easily be $5 billion and we look at the pillars that we used to drive that growth, which is Asia, digital, Clogs, Sandals and personalization and we see really kind of solid progress against all of those pillars, as I probably say more than solid progress we've seen sort of incredible progress over the last several years against those pillars. I think quite a few things have changed since we provided that guidance in around global supply chain. We had to pull back out of Russia because of all the issues that you're well aware of and frankly currency as well cost us about $200 million dollars in top line. So I don't think that it's realistic to achieve the $5 billion by 2026. But - and so we're really focused on driving continued growth in a profitable and sustainable way. And probably take a little bit longer. But I think it still drives incredible shareholder returns and value creation for shareholders and in terms of operating margins, this will be the first year. I think with deviating from the – or projecting to deviate from the 26%. We still think the operating margins for our company are in the mid 20s. But will not be every single year above the 26% mark. We think it's very prudent to invest incremental dollars from time-to-time to create the capabilities that allow us to grow in the future. Hopefully it gives you a perspective in a long term.

Very helpful. Thank you.

The next question comes from Abbie Zvejnieks of Piper Sandler. Please go ahead.

Great. Thanks for taking my question. Just on the Crocs brand, is there any color you can give on quarter-to-date trends and the Crocs brand being guided to 6% to 8% percent versus 4% to 6% for the year. What are you seeing that gives you confidence in that number? And does that assume just a continuation of trends that you're seeing so far? Is there any Improvement contemplated in getting to that 6% to 8% for the quarter?

Yeah, I think I'll obviously we get a of a bit of brand color and Anne can give you some of the more specifics. I would say, it's a continuation of the trends from last year, basically. We see - we don't give a lot of in-quarter color. But if you think about some of the big drivers that have really be propelling the brand. And so Asia and international growth has been super important. We see Clog growth, Sandal growth and Jibbitz growth from a product perspective important and as you know, we have visibility to bookings. So we feel real confident around our wholesale bookings and we see we see solid sell-out for the brand. So I think it’s continuation mostly.

Yeah,a nd just January, we don't really comment on trends inter quarter, but January is a very small piece of our overall quarter when you that is pretty a material for us as a business.

Got it. That's helpful. And just one follow-up more of a housekeeping question. Since you changed the reporting segments, is there any way you can tell us kind of what 4Q would have looked like under the old reporting segments? Thank you.

Yeah, so, as we didn't change our reporting segments to our new reporting segments are HEYDUDE Brand and Crocs brand as we think that reflects how we should look at the business. So as reported, North America grew 3%, in Q4, international grew 25% led by Asia Pac, which was up 36% and Amelia was up 16%. For the year operating profit dollars across all regions increased double-digits verses prior year, and the strongest growth came from Asia Amelia. So this will be the last time what we will give the information as our segments have now changed but that gives you some full-year picture.

Perfect. Thank you.

Thank you, Abby.

The next question comes from Jim Duffy of the Stifel. Please go ahead.

Thank you. Good morning. Appreciate you taking my question. Hope you guys are doing well. Two questions. First, can you speak to the outlook for international markets, specifically, which are the markets you are excited about for ’24, certainly Chinese on that list. Are there are others that you would highlight? And likewise in the international landscape of the market do you expect to be more challenging?

Yes, absolutely, Jim. So I think, let me start with this sort of highlights. China is probably top of the list as you rightly pointed out. We've had kind of a multi-year investment effort and focus on China. I am really thrilled with that study to pay off in 2023 with triple-digit growth essentially doubling the business during that year from a top-line perspective. Obviously, it improves dramatically from a bottom-line perspective, as well. But we're just getting started in China, right? So 4% of our overall revenues, if you look at sort of other global brands that benchmark of sort of Greater China substantially higher than that maybe four to five times higher than that. So, I would say second, we're seeing great trajectory in parts of Western Europe, particularly the UK we're probably on a two to three-year very strong growth trajectory in that market. And it's also an important market for influence across the European marketplace. We're seeing strong trajectory in France also I would say thirdly North Korea - sorry South Korea has been a very steady growth driver for us. And I think I mentioned in my prepared remarks it’s actually only isolated our countries around the world is our highest market share performance even above the United States, but we see the future opportunities continued growth opportunities in South Korea. Australia has performed very strongly. We've seen a real turnaround in the business there. And so those are probably the highlights. I think the more challenging markets, Japan remains a slightly more challenging market. I think we're shifting focus that market because it is a large market and we do anticipate growth in the future, but we've got some work to do. And I think you know, we're very, very optimistic about India in the long range and we're putting substantial investments into that market a little bit like we did it around China. But there are a number of short-term issues around sourcing that are creating some I think some headwinds in there very short term. But I think in the long term India will be a big success.

Very helpful. Thank you, Andrew. Anne soon you'll be above the fray on questions like this, but I do have a question on the tax rate outlook. It came in a little bit lower than I expected. Is that reflective of geographic mix of the profit tools? I guess that what I went after here, is that a sustained – we view that as structurally sustainable tax rate or there a one kind of dynamic related to that?

Yeah, thanks Jim. Yes. I'm very excited to turn trekking over to tax trekking back over somebody else. But I think our tax rate as with any Q4 we moved our HEYDUDE IT from Hong Kong where we don't have operations to Singapore and Netherlands and that created that one-time benefit of $112 million that we backed out for the purposes of adjusted EPS. You could have a better idea of our true underlying tax rate for the current year. That does have underlying benefits for this year. So that's how we get to the 18% So it reflects some geographical mix, but also just a restructure in our in our tax structure. Right now, we're saying we think 18% is right for this year. I would still use 20% long-term until we have a better picture going forward.

Helpful. Thank you.

Thank you.

The next question comes from Chris Nardone of Bank of America. Please go ahead.

Great. Thank you. Good morning. Can you talk about the underlying assumptions in your outlook for the relatively stable gross margins for your core Crocs business this year? I'm just trying to understand what would be holding that back from expanding on the mid-single digit growth and if margins do come in better, are you expecting to spend against that strength or you allow some level of flow through to the bottom-line this year?

Yeah, I think that's a great question. So obviously we're really pleased with our Crocs gross margins. For the year, they expanded nicely after what was a tougher 2022 on some we had some significant freight tailwinds. We think that's pretty normalized at this point. So we think that just given all the puts and takes so, you've got currency, you've got freight, you’ve got mix from a channel perspective, pricing and product mix. We think that that about where we were last year is a fairly good place to be. So on revenue growth that's not necessarily where we tend to see margin expansion on revenue growth as your operating margin because you leverage your SG&A. This year, we've made the conscious decision to take those dollars and really invest as - about that we're investing in India and some of our other international markets as well as talent and really focused on that long-term sustainable growth. If we can - if we exceed what we said if we have good Investments we will make the call whether we should continue to invest for the long-term or let that flow through an compound operating margin perspective.

Got it. That's very helpful. And then just as a quick follow-up, can you provide an assessment of how the Red Sea disruption is impacting your business today? I am just trying to gauge what you are underwriting for freight rates this year and your initial for your margin outlook?

Yeah, so right now from a Red Sea perspective, we're really seeing it impact from are mostly our EMEA business at this point we're seeing a couple weeks delay. Overall from a shipping time perspective we haven't seen a material change to our freight rates at this point. And so I would say, we don't know what's going to happen this year. Obviously, we don't know how this is going to play out. But at this point, it's not it's not been a material impact to our business.

The next question comes from Jeff Lick of B. Riley Financial. Please go ahead.

Thanks for taking my question and Anne, I would extend my congratulations, a incredibly well-deserved promotion and increase in role. Andrew, I was wondering if you take a step back and look at 2019 as a starting point where in North America was $640 million in with the Crocs brand and international was $590 million. Obviously there's way more people internationally than in the U.S. And I think there's an argument to be made that the Crocs brand might even resonate a little bit better with certain countries and populations than the U.S. So, I'm just wondering if all the things that you had done leading up to the pandemic, customization, social influencing, speed to market with distribution, obviously, you did that in the U.S. first if you use the U.S. as a kind of a leading indicator, I'm wondering kind of where you're at like what you're seeing internationally and do would you disagree that international should be at least as big if not bigger than the U.S. And then I guess, the critics might say we’ll see the U.S. is going to come back that obviously hasn't happened. I was wondering maybe you could speak to what people are missing as to if anything in the US has accelerated just the dynamics between the US and international was what you could give us there?

Okay? Yeah, I think like I ought to see Japanese great way of thinking about it, right? So, just to sort of paint the picture for everybody, what we saw the Crocs brand really started inflect in the U.S. marketplace sort of late ‘18 into ‘19 and then grew dramatically through the pandemic. I think, a lot of people outside of the company kind of put that down to well, that was the pandemic and people were happy to wear Crocs at home, but they're not happy to wear Crocs when they are back out in the real world, right? So, I think at this point, hopefully, that has proven to be incorrect in that, people are happy and excited to wear Crocs out in the real world. And I think what's happening there is we're engaging the consumer, we’re excited in the consumer with innovative new products with a high comfort product, with a high value product, with a product that can be personalized in many different ways and it's pretty exciting and the customers engaged in it. So that's grown that business dramatically. We've seen that trajectory repeated in a number of our international markets. And so we look at markets like the UK. We are still probably in our third year of very accelerated growth. So we're seeing that trajectory play out. And so, and then as I highlighted an earlier question and in our prepared remarks, we actually have the highest market share in the Korea marketplace as of today. So even above the U.S. So that's to your point around there might be some places in the world where the Crocs brand actually resonates even better than in the U.S. Easy on and off and that’s kind of key component that where culturally there are many markets where people take their shoes off when they go into a building or go into somebody's home. So I think that's a viable thesis. We're not guiding the international businesses to be clear and then bigger than the U.S. business. I mean, I think when we did our $5 billion plan, we were pretty clear that a lot of our growth will come out of Asia and that international will be super important. And you've seen that in the last six quarters, the international business growing very strongly. So we can cut.

Okay. Thank you.

The next question comes from Sam Poser of Williams Trading. Please go ahead.

Good morning. Thank you for taking my questions. I have two for Anne want can you talk about evolving demand planning, especially with the HEYDUDE brand in order to get to the pull model that that you're working towards and how that is working within the Crocs brand and how you in your new role intend to make that work further work? And then, for Andrew, Andrew you talked about it in the prepared remarks about promoting Anne to this position. Could you just expand on why she is, you went through a long process here wasn't quick from what I gathered, but can you sort of go into sort of some more nuanced discussion of why she ended up being the best person for the job and in your view? Thanks.

You mean other than she's awesome?

I think yes. Other than she is awesome.

I’ll let her answer the first question.

Andrew is thinking of a good answer for you Sam now and just can’t getting at. So, yes, on the demand planning front, for both HEYDUDE and from a Crocs perspective, we have key account planning really very thoughtfully at our big accounts and we plan strategically what sell out is and we are not obviously trying to sell-in. We, as we talked about on HEYDUDE a couple of key differences we are making and remember, when we bought HEYDUDE we didn’t really have the infrastructure in place. So we were mutual and tools and that we're implementing. We worked really hard to do that last year. So we're also looking at making sure that the - as Andrew mentioned that we have the right products in the right accounts and that we’re thoughtful about seating product in the right place and also, depths and where we put things. So we're really focused on as you mentioned letting it be a pull model and if we are a little bit short on some things and it sells out fast enough, right? And that's more demand for next year. So that's kind of how we're thinking about it. That's how we think about it existing on the Crocs side.

Great. So your second question, so look at me my flippant answer is important right? Like we have great confidence in on both the knowledge of the business, the commercial acumen, her understanding of kind of the consumer trends, beyond her abilities as a CFO. So, that's important. I would say this transition is part of the succession planning that we've been doing for some time. We do it for all of us senior leaders. We do that in conjunction with the Board as you'd expect. And we have a very thorough process around this. So, it's definitely something we take very seriously and we think this is, listen this, Michelle is retiring and we wish her well. I mean she's done an amazing job and as I also said in my prepared remarks, she has been doing this in the footwear industry for a long time and have some other things that she would like to like spend a bit more time doing. So, I think it's a very natural transition and very well planned.

Thanks. And then I just have a real quick follow-up for Anne, it was just somebody else's question about, comfort that the Hated business would grow in the back half of the year. How much of the sort of the way this looks like it's going to flow is retailers and you overreacted, put too much product into the marketplace at the beginning of last year given sort of the way things were in the middle of this year when they were writing spring retailers over probably over reacted and may not have written enough. And now they're sort of seeing what's going on and then that started to normalize as the orders move throughout the year. Am I thinking about that correctly?

I think mostly Sam. Yeah, that's mostly a very thoughtful understanding of the marketplace.

Thanks very much. Good luck.

Thanks, Sam.

Thanks, Sam.

The next question comes from Aubrey Tianello of BNP Paribas. Please go ahead.

Hey, good morning. Thanks for taking the question. I wanted to follow up on Crocs North America. You mentioned changing the distribution model with Amazon. Could you maybe give a little more detail on what's changing? How those changes was with the P&L? And also what the timeframes for that?

Yeah, yeah great question. So as we talked after our third call, I think taking a step back really at the highest level globally, we are trying to have more brand control in global marketplaces where our brand is sold. So we talk about marketplaces that's on a digital front and those maybe Amazon or others. And so the best way to do that is for us to sell directly to the consumer on those marketplaces. So it's direct-to-consumer sales versus a wholesale sales. So the dynamics is how it flows through the P&L. It's a higher gross margin, higher Sg&A, higher revenue, but it's really not - that's not the focus point. The focus is just controlling our brand and how consumers should - how it shows up to the consumer and making sure that we provide a consistent and best experience for our consumer. I would say, this distribution model performs - has been performing in line with our expectations these changes. And so, we will expect to continue down this path this year.

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

Thank you. I just wanted to express our sincere appreciation for everybody's joining us today and their interest in our company. So, thank you so much and have a great day.

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