Dine Brands Global, Inc. (DIN) Q1 2013 Earnings Report, Transcript and Summary

Good day, ladies and gentlemen, and welcome to the Quarter 1 DineEquity, Inc. Earnings Conference Call. My name is Matthew, and I will be your operator for today. [Operator Instructions] As a reminder, this call is being recorded for replay purposes. And now, I would like to turn the call over to Mr. Ken Diptee, Executive Director, Investor Relations. Please proceed, sir.

Good morning, and thank you for participating on DineEquity's First Quarter 2013 Conference Call. Today, I'm joined by Julia Stewart, Chairman and CEO; and Tom Emrey, CFO. Before I turn the call over to Julia and Tom, let me remind you of our Safe Harbor regarding forward-looking information. Today, management may discuss information that is forward-looking and involves known and unknown risks, uncertainties and other factors which may cause the actual results to be substantially different than those expressed or implied in such statements. We caution you to evaluate such forward-looking information and the context of these factors, which are detailed in today's press release, as well as in our most recent 10-Q filing with the Securities and Exchange Commission. The forward-looking statements made today are made as of the date hereof and assumes no obligation to update or supplement any such statements. Additionally, we may refer to certain non-GAAP financial measures, which are described in our press release and are available on DineEquity's Investor Relations website. With that, I'll turn the call over to Julia Stewart, Chairman and CEO. Julia?

Thanks, Ken. Good morning, everyone, and thank you for joining us on DineEquity's first quarter 2013 earnings call. This quarter marks the start of our first fiscal year since completing the Applebee's refranchising program in October 2012. After ending last year on a strong note, we started 2013 by delivering solid results. Additionally, we announced our capital allocation strategy, which returned significant free cash flow to our shareholders through the combination of a meaningful first quarter dividend, $0.75 per share of common stock and $100 million of share repurchase authorization. We also completed the repricing of our senior secured debt and modified the debt covenants to lower interest costs and provide increased flexibility. Our proactive G&A restructuring last year resulted in a 14% reduction compared to the first quarter of 2012, and our highly-franchised business model generated a 34% increase in free cash flow. We paid out over $14 million in cash dividends in the first quarter, and we're working hard to drive consistent and sustainable same-restaurant sales and traffic at both of our brands. Looking forward, we will continue to manage our capital structure with a long-term view and maintain a strong balance sheet while emphasizing the importance of positioning the company to potentially refinance our overall debt in the next few years. Now, the first quarter was uneven, as others in the industry have noted. And while we don't normally discuss the economy, the industry was clearly faced with macroeconomic headwinds, which contributed to viability and variability in the quarter. The environment definitely impacted the consumer and had some effect on domestic system-wide same-restaurant sales at both brands. The duration of the residual effect is difficult to gauge and consumer confidence remains mixed. I'd now like to provide a brief review of the first quarter and then I'll let Tom discuss the financial details. I'll start with IHOP. As I've shared with you before, I am confident in our strategy, our executive team and especially, our franchisees. We will continue to execute on our plan in order to achieve consistent and sustainable same-restaurant sales and traffic growth. As a reminder, the 4 key pillars of our plan to drive improved performance are differentiating our menu, providing better value, strengthening our advertising and media and consistently achieving operations excellence, all of which are designed to make our franchisees more profitable. The changes necessary to achieve each of these are gradual, but we are making progress. Remember that as a 99% franchise company, fluctuations in same-restaurant sales have less impact on our bottom line. However, we are very focused on improving franchisee sales and profitability for the long-term health of our business. IHOP's domestic system-wide same-restaurant sales mark an improvement from the last 3 sequential quarters, down slightly by 0.5%. Even though we outperformed the family dining category overall in the first quarter, this is not acceptable, and I will continue to challenge the team and the franchisees to reach our goal. Frankly, we are driving changes rapidly as we can effectively execute at this time. On advertising and marketing. In the first quarter, we continued to refine our strategy as demonstrated by the innovative TV spots in support of our successful promotion, All You Can Eat Pancakes, as well as the recent commercial filmed at Times Square for our new line of breakfast sandwiches, Griddle Melts, which is superior in quality and taste. Recognizing that we previously did not have a line of breakfast sandwiches to compete in this category, we conducted comprehensive research before introducing Griddle Melts. In fact, this new offering is a great example of us being relevant to our guests. In addition, it reflects the next level of creative innovation. Our breakfast sandwiches, in my humble opinion, are simply the best in the industry. I encourage all of you on the call today to visit an IHOP and see for yourself. IHOP's menu is key to our success. And so we introduced in January the first of 3 new menus planned for this year. The second launch is scheduled for June 1 and the third is slated for late 2013. Our strategy is to simplify the ordering process by improving the overall layout while celebrating our food with improved mouthwatering photography, significantly reduce the number of menu items offered over time that lessen complexity and most importantly, introduce new and exciting menu offerings and categories. We're in the early stages of the execution on our new menu strategy, but we are confident in our plan. And to accelerate our menu innovation, we brought on a new head of menu development and innovation, who has extensive background in the casual dining space. We are very excited about the influence that she will have in the development of a pipeline of products, that only IHOP could deliver, further strengthening our iconic brand's position in family dining. Regarding innovation and value. Late last month, IHOP announced the introduction of its latest breakfast innovation, Brioche French Toast. This next generation of French toast comes in 3 delicious and distinctively new flavors, which I'm sure our guests will enjoy. The item is just one of the many new signature dishes and categories IHOP will launch in 2013. On IHOP's gift card sales. The gift card program remains an important part of our marketing strategy and we're seeing continued interest. For the first quarter, IHOP's gift card sales increased by 17% from 1 year ago. And as I've said before, we are paying attention to every part of this business. With that, let's shift to Applebee's results for the first quarter. Regarding same-restaurant sales. domestic system-wide same-restaurant sales were down 1.3% in the first quarter. Sales were impacted by a decrease in traffic due in part to the bumpy environment I mentioned earlier. And while it is clear that the casual dining space faced headwinds, we will not allow macro conditions to dictate our results. We are working to restore Applebee's same-restaurant sales and traffic momentum by differentiating the brand through innovative and creative advertising, testing new technology platforms and providing a broad array of craveable menu items that will entice repeat visits. On value in the menu. Value is a competitive factor in this space and we continue to see an aggressive emphasis among the competition. We are working to address this across each day part and provide a signature Applebee's dining experience you just simply can't get anywhere else. In February, we refreshed our popular 2 for $20 value offering with the inclusion of 2 new dishes inspired by New Orleans-style cuisine. 2 for $20 continued to perform well. Refining our menu is an important part of the dining experience for our guests. Additionally, we are testing new health and wellness options that are nutritionally responsible without sacrificing taste. On the remodel program. Applebee's franchisees remodeled 40 restaurants in the first quarter. At the end of the quarter, 54% of the domestic systems have the new revitalized look and we project that approximately 70% of the system will have the updated look by the end of this year. Regarding Applebee's gift card sales. Sales increased 15% compared to the first quarter of 2012, with gift cards, reflecting the strong affinity guests have for the brand. The close, we are optimistic about the hard work on the IHOP menu coming to fruition and while we've not yet achieved our goal, the team and I and the franchisees are committed to making the changes necessary to get the business back on track. And at Applebee's, we have a proven strategy in place and we are building on it. We are streamlining the core menu and focusing on innovative ways to drive consistent sales and traffic growth. With that, I'd like to turn the call over to Tom Emrey, our CFO, for a discussion of our first quarter results. Tom?

Thanks, Julia, and good morning, everyone. I'd like to review some more highlights from the press release we issued today. For the first quarter of 2013, adjusted net income available to common stockholders was $21.8 million or $1.14 per diluted share. This compares to $24.6 million or $1.36 per diluted share in 2012. The year-over-year decrease is mainly due to the expected decline in segment profit as a result of refranchising. This decline was partially offset by lower G&A and lower cash interest expense as we continue to focus on controlling costs. I'd like to highlight that the first quarter has historically been our most profitable, partially because gift card redemptions are generally the highest during the period following the holiday season. Our franchise segment profit was up $2.9 million in the first quarter of 2013 over the prior year, mainly driven by the increase in franchise restaurants due to Applebee's refranchising and restaurant development predominantly by IHOP franchisees. G&A expenses were $34 million for the first quarter of 2013 compared to $39.6 million in 2012. The decrease was mainly due to lower personnel costs as a result of refranchising and our comprehensive restructuring initiative announced in July of 2012. Our plan is tracking to deliver the savings we had anticipated. Regarding cash flow, our highly-franchised business model continued to generate strong free cash flow in the first quarter. Free cash flow increased by 34% to $59 million compared to the first quarter of 2012, due to a favorable change in net working capital, mainly resulting from the timing of prepaid rent, an increase in gift card cash collections because of higher gift card sales and a decline in cash interest payments due to lower debt balances. Please note that the increase in cash from operations was partially offset by the cash dividend paid to the first quarter of 2013. To recap, the cash balance of $117 million at the end of the first quarter was high in part because of pending interest in estimated tax payments, the swing in networking capital mentioned before and seasonally high sales. Regarding the tax rate for first quarter of 2013, the effective tax rate just the first quarter was 39.6% compared to 36.1% in the first quarter of 2012. Approximately 2 percentage points of this increase was due to lower income tax credits, primarily FICA tip and other compensation-related tax credits as a result of refranchising. The remaining 1.5 percentage points of the increase was primarily due to first quarter adjustments to our reserve as a result of recent audits with taxing jurisdictions. We still expect the full year rate to be approximately 38%. Interest expense declined by approximately $5 million or 16% in the first quarter compared to the same period in 2012, primarily due to the reduction of debt balances over the past 12 months. Our consolidated leverage ratio at the end of the first quarter was 4.7x, up slightly from 4.6x at the end of the fourth quarter 2012. And please remember that the current leverage ratio is based on trailing 12 months of EBITDA and the leverage ratio moves with EBITDA. The full computation, again, is defined in our publicly filed credit agreement. To close, we're delivering on our stated objectives is to reduce G&A, generate strong and stable free cash flow and manage our capital structure to position the company for long-term success and create value for our shareholders. And now, I'll turn the call back to you, Julia.

Thanks, Tom. We will continually enhance the appeal of our brands and remain responsive to the needs of our guests. And I am confident in our long-term strategy. As stated in our press release this morning, please note that we are reiterating our financial performance guidance for fiscal 2013, which we shared on February 27, 2013. And lastly, we are focused on creating value for our shareholders as evidenced by the first quarter cash dividend payment of $0.75 per share of common stock and the $100 million share repurchase authorization. We will concentrate on the levers that we can control to drive sustainable, long-term shareholder value. With that, Tom and I would be pleased to answer your questions. Operator?

[Operator Instructions] And the first question comes from the line of Michael Kelter from Goldman Sachs.

First question, I guess, Julia, when you talked about the macroeconomic backdrop, which of course impacted everyone, you said the duration of the residual effects of the slowdown was difficult to gauge. And I guess I was surprised by that comment since most restaurant companies talked about a quick snap back to solid growth in March, April. So I guess my question is, did you not see that same dynamic?

Well, I don't comment on inter-quarter, so we don't talk about April. But for the first quarter, it was definitely lumpy and bumpy and so, I think there were weeks where it was incredibly positive and weeks where it was negative. And so my comment is, it's hard to predict what the balance of the year holds, and I think it is sort of a mix in the environment. Again, I don't want to put a lot of weight in that because I think our job is to differentiate our brands. But clearly, we saw a lumpy and bumpy first quarter.

And then on G&A, I just wanted to get a little help there. You mentioned that it was partly -- that line item partly benefited from lower incentive compensation. What was the year-on-year delta on incentive compensation? And whether -- and do you expect that to continue through the year? Or was that just likely a first quarter phenomenon?

We're going to have to track that down here. We'll get that back to you before the end of the call, the actual numbers.

The actual number, yes.

Yes, I'm just trying to get a better idea of what the underlying G&A run rate is, given how much the P&L has changed in the last year or so.

Yes. And as I said, you really have to go to the guidance we gave because we are reiterating guidance for the year on G&A, along with every other line item. So if you look at guidance from February 27, that's the number we're going with for G&A for the year.

All right. And then lastly, IHOP showed some improvement, and that said, you acknowledged that it did decline again. At this point, after 9 straight quarters of same-store sales and traffic declines, are you starting to see ramifications with the franchise community?

So I'm not sure about this first part of your comment about decline. We announced that for the first quarter, sales were 0.5% negative.

Right.

And that's better than it has been the last several quarters.

Well, I guess my comment is it's been negative for each of the last 9 quarters.

Right.

And I'm curious if you're starting to see any sort of ramifications with the franchisees at this point.

No. I think the reality is, I've mentioned this on several occasions, that our bad debt is 1/2 of 1%. I mean, we just don't see that because I think they have enough cushion. But I would tell you that there is a tremendous amount of pressure and emphasis being put on by both franchisees and management to do everything that we can. Frankly, I think one of the best things that's happened is the purchasing co-op, which enables them to have the significant savings in the food cost line and in the distribution line. So that's really been a saving grace. I didn't share this, but the commodity inflation forecast for 2013 for IHOP is positive 0.08, so that's actually a good thing.

Your next question comes from the line of John Ivankoe from JPMorgan. John W. Ivankoe - JP Morgan Chase & Co, Research Division: First, I did want to follow up on the cash balance. I think, Tom, you've pointed out what a lot of us thought that it looked optically high at the end of the first quarter. So, I mean, can you put that cash balance, your generation of cash, in the context of your share repurchase that I think has already been announced? I mean, should we expect that you put free cash flow to share repurchase second, third and fourth quarter? I mean, how should -- where should we go from here?

Well, like we said when we announced the program at the end of our earnings call last time, we're going to be opportunistic about our share repurchases and the size of the cash balance at any given point in time is not necessarily indicative of what our plans are. John W. Ivankoe - JP Morgan Chase & Co, Research Division: Okay. And could you remind us, I mean, like what is a base level of cash for your business, like I mean, for example, on average throughout a fiscal year? I mean, what do you need to run your business successfully, especially given the fact that you do have a revolver?

Yes. We haven't really provided that number out, and I'm not really prepared to do that right now either. John W. Ivankoe - JP Morgan Chase & Co, Research Division: Okay. I'll move on to a separate topic. I think your system-wide sales, I mean, all stores year-over-year were down slightly year-over-year in the first quarter of '13 versus '12. Obviously, comp is one component of that, the other component is unit growth. I mean, are you beginning to see any appetite domestically, international, for increased unit growth? And maybe referencing the previous question, I mean do you see -- are we at risk of stores closing or eclipsing your net unit growth '13 and '14?

So I think the best way you should think about it, go back to guidance, which was Applebee's was 40 to 50 restaurants for the year, right? The large majority in the U.S. IHOP was 50 to 60, majority in the U.S. That is pretty much similar on the IHOP side. That is substantially increasing on the Applebee's side. So the short answer is, there is continued interest both brands and certainly with the large majority of Applebee's being remodeled, I think you can honestly say there is more interest now in developing with the large majority of the system remodeling, and albeit not aggressive growth on the international side, I think we'll start to see more interest. And we do have more multiunit development agreements in place internationally now. So I think we are vetting that international strategy as we speak, and you'll see more of that in the coming years. It is safe to say, though, with a 4,900 square-foot building, it's not like we're going to build 1,000 thousand in China. It just doesn't work that way. But I do think we can increase the rate, internationally, at some point. John W. Ivankoe - JP Morgan Chase & Co, Research Division: Okay. And one more final question for me, and this is kind of an add-on to Mike's question. Your press release said lower stock-based compensation and I wonder if that is -- I mean, you're just planning to issue fewer restricted shares or fewer options, year-over-year that might be even be different than incentive compensation. I mean, was that a first quarter event? Was there something unusual in timing with that?

No. There's nothing particularly unusual about it. I mean, there's fewer executive employees as a result of refranchising and restructuring, that's a piece of it. [indiscernible] John W. Ivankoe - JP Morgan Chase & Co, Research Division: Normally that number goes up, especially with the higher stock price, but that's not necessarily the case in 2013?

Not necessarily, no.

Your next question comes from the line of Bryan Elliott. Bryan C. Elliott - Raymond James & Associates, Inc., Research Division: First, just actually a couple of follow-ups. So first on the cash question. So if I think about your business as it exists today, near-term cash needs would be obviously to meet the headquarter's payroll and the G&A -- payroll piece of G&A and build up the 6-month recurring interest payments and that's about it, correct?

Well, there's taxes, among other things. Bryan C. Elliott - Raymond James & Associates, Inc., Research Division: And taxes, okay. Yes, I forgot about them. That's true. Okay. And my next question would be, thinking about the -- just the industry dynamics and Applebee's position as the largest casual dining chain. So basically, you held your market share in Q1 despite the difficult and choppy environment. The impression will be left, Julia, from your earlier answer that you didn't snap back as much as the industry, then therefore, Applebee's has entered a period of market share losses. Could you address that interpretation of your previous answer, please?

Yes. I think the first part of your comment/question is correct. We held our own in market share and if you look at the outside resources that track, we certainly beat the rest of the large competition in casual dining for first quarter. That's just not good enough, obviously, right? To be less negative than everybody else is not good enough. And so holding our share on market shares is absolutely correct, but we want to do better than that. We've been in the positive comp territory for a long time. Bryan C. Elliott - Raymond James & Associates, Inc., Research Division: So we're going to be left hanging, debating whether Applebee's has slipped relative to the industry in March and April but saw a solid comeback?

Yes. I think the way you should think about it is at first quarter, we guided for the year a negative 1.5 to a positive 1.5. We have not changed guidance, and the environment is lumpy and bumpy. I think it's just a fair comment.

Your next question comes from the line of Bryan Hunt from Wells Fargo Securities.

Julia, I was wondering if you could just comment on perhaps how the intensity of promotions in both family and casual dining may have changed throughout the quarter, and what do you think of the current environment in terms of promotional intensity?

Yes. I'm not big on inter-quarter, I'm big on sort of directionally. And directionally, I would say if you think about the last couple of years, there's been a fair amount of promotion. I think there's more today than there has been. We do a tracking internally. And if you look at -- it doesn't really matter whether it's fast food, fast casual, casual, family, everyone is doing a fair amount of promoting. And as I've always said, one of the things I'm most pleased with on the Applebee's and IHOP's side is that we have value-engineered these products we've put on television. So we make money. Our franchisees make money. It's just not simply discounting from the existing menu. Many of our competitors are still doing that, discounting on existing menu items. So I do believe that our strategy is having a positive effect financially. Someone asked that question earlier about our franchise community. But I think the environment is aggressive in terms of value, and I think it's going to be that way for a while.

Additionally, when we look at the casual dining industry, there's definitely some of your competitors that are spending ample time on remodels. I was wondering if you could talk about your own systems remodels. Are they continuing to see the lifts that they have in the past year in terms of returns on the remodel CapEx?

Yes. Nothing has dramatically changed on the remodel. As you know, contractually, Applebee's franchisees have 6 years to remodel. A large majority of the system will do it in 4. I think the reason for that is not only do they believe in the remodel, but it is providing that low-single digit ROI.

Your next question comes from the line of Will Slabaugh of Stevens.

I want to ask first on IHOP. Just, in general, how the new menu items you've put in place already are mixing. I know you launched oatmeal, whole-wheat, pancakes, et cetera, some other new menu items, so how are those trending. And then any more color you'd be willing to give on the second menu launch in June and what we should look for as far as how you'll be judging yourself there.

So all of the new items, whether it's the oatmeal or some of the parfaits or the sandwich Griddle Melts, the Brioche French Toast and Griddle Melts go on the June 1 menu. So they go from TV now onto the June 1 menu. So there's a little bit of TBD. But I think the thing we are most looking for in the June rollout is, in general, what happens to penny profits for franchisees and what happens to mix. Because that menu is a very different design than we have historically had and in the test, we got a ton of positive feedback both from franchisees, food servers and guests that it became easier to find the menu items, it didn't take nearly as long to navigate the menu and people really were able to find things that they just never had seen before. In particular, the greatest feedback we got in the testing was, "Didn't know you had appetizers." Now we've had appetizers for 40 years, but suddenly they can find them in the menu. So I think we're looking for mix shift. We're looking at penny profits, which we don't typically ever disclose, but this is all about our franchises making certain they make more money and that we get this navigation improvements, which frankly, indirectly, should help us on speed of service. So we'll be looking at speed of service, quality mark, how people feel about how long it takes to get their item, penny profit, lots of different ways we'll look at that menu. But a lot believe, certainly from the test results, that it will be incredibly well-received.

Got you. And on the menu, do you know up the top of your head what the number of menu items will be on the newer menu versus the old?

On IHOP?

Yes.

You're still around 175 on the menu. It -- you won't see that dramatic reduction until the late-2013 menu. It's a very difficult process to get 365 franchisees to agree what you're going to take off the menu, but I have confidence and faith in both our franchise leadership council and our marketing team that we can begin to reduce those items.

Got you. And just a quick follow-up to the G&A question from earlier, in the impressive drop year-over-year this quarter. I know you guys have given that guidance for this year. I just wonder if you had any sort of directional idea of how we should think about modeling next year's G&A. I know we're kind of early here, but modest growth there or further reductions, just in general how to think about that?

Yes, I think the best way to think about it is there was a lot of timing issues in the first quarter, which is what we tried to say, but our guidance is still the same for 2013 for G&A. Don't get too excited about first quarter. And when you think about thereafter, I would tell you today, we've done a pretty darn good job of maximizing G&A. So today, I would tell you, I don't see any large dramatic reductions. I think what you see is what you get. But good management should always be looking at G&A. So we'll always have one eye on, is there opportunistically anything there? But I think pretty much what you see is what you get from a G&A steady state basis. In terms of guiding for 2014, we'll certainly do that next year, but I don't think you're going to see some sort of major reduction. I think we've pretty much done everything we can do.

Your next question comes from the line of Jeff Farmer from Wells Fargo.

At Applebee's, it looks like you're pointing to differentiated advertising. I think you just said new technology, craveable menu items, as some of the planned traffic drivers for the balance of the year. Can you just give us a little bit of color there, some of the key items that you think have some of the best opportunity to move the needle for you guys?

Sure. I think most people know, we spend a fair amount of the national advertising dollars at Applebee's on ESPN. And I think we have an opportunity there to stretch the envelope and do some pretty humorous and inviting ESPN advertising, which we've been very focused on, if you've seen that. And I think on a day-to-day basis, whether it's lunch or dinner or tagging it for late-night, it's how we can differentiate ourselves. I mean everyone wants great food photography, but it's what else we do to begin to really differentiate the brand. And that is the work that the team there has been really trying to solidify how we can break out through the clutter. And that's a real focus for us as we speak for the balance of the year. The promotional calendar is set, but it's, what can we do on an advertising front? So there is a tremendous effort there to sort of enhance whatever we have and break through the clutter. On the technology, I've been loath to say too much, because we're in some alpha and beta testing. But you should think about the kind of technology that would help either from a consumer facing perspective or from things that we can do to enhance our ability to deliver to the consumer. But more of it is really consumer-facing kinds of technology that we're looking at that would differentiate it.

Okay, that's helpful. And then just one quick accounting question and I missed this. I was reading through the last transcript, wasn't clear on this call, at least to me, D&A. So not G&A, but D&A. What's the full year '13 D&A targeted at right now?

We don't guide on that.

Okay. I thought last quarter it was sort of embedded into some G&A guidance. I must have misread that. So no D&A guidance? Can you at least let us know if you think the number we saw on the first quarter, the 8...

Well, the number that we guided, I'd -- to clarify, that the number that's in there...

That we released in February?

Yes. Consolidated general and administrative expense is expected to decrease between $140 million to $144 million, $147 million, including noncash stock-based comp expense and depreciation of approximately $19 million due to comprehensive G&A administration reduction -- cost reduction initiative. Is that the number you're talking about?

Yes, so I'm still confused what that means.

It's noncash in G&A.

So noncash D&A in G&A. Okay. That's -- Bryan Elliott knows more about this than I do. He should probably asked the question...

It's a noncash piece of the G&A.

Okay. And just one last question. And so the D&A number was almost $9 million in the first quarter. Is that a representative run rate as we move throughout the balance of the year, considering all the asset sales or the refranchising of the company-owned restaurants?

Yes, we think so.

Thank you, ladies and gentlemen, then for your questions. I would now like to turn the call over to Julia Stewart for the closing remarks.

Thank you, operator, and thank you, all, for being here. So 2 comments. One, I want to correct something I said. I guess I was speaking fast. When someone asked the question about the remodels at Applebee's, I said a low-single digit ROI. I meant to say a low-single digit lift off of sales. So I apologize if I misspoke. And then to wrap up, thank you, again, for participating this morning, really appreciate it. And our second quarter 2013 reporting date is July 30, 2013. And as always, if any of you have any additional questions, please feel free to call Ken, Tom or myself. Thanks for your time this morning.

Thank you for joining today's conference, ladies and gentlemen. This conclude today's presentation. You may now disconnect. Have a good day.