Hello and welcome to The Greenbrier Companies Third Quarter of Fiscal Year 2019 Earnings Conference Call. Following today's presentation, we will conduct a question-and-answer session. Each analyst should limit themselves to only two questions. Until that time, all lines will be in a listen-only mode. At the request of The Greenbrier Companies, this conference call is being recorded for instant replay purpose. At this time, I'd like to turn over the conference over to Mr. Justin Roberts, Vice President and Treasurer. Mr. Roberts you may begin.

Thank you, Dustin. Good morning, everyone. And welcome to our third quarter conference call. On today's call, I'm joined by Greenbrier's Chairman and CEO, Bill Furman; Lorie Tekorius, Executive Vice President and COO; and Adrian Downes, Senior Vice President and CFO. They will discuss the results for the third quarter and provide an outlook for Greenbrier's fourth quarter of fiscal 2019. Following our introductory remarks, we will open up the call for questions. In addition to the press release issued this morning which includes supplemental data, additional financial information and key metrics can be found in a slide presentation posted today on the IR section of our website. Matters discussed on today's conference call include forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Throughout our discussion today, we will describe some of the important factors that could cause Greenbrier's actual results in 2019 and beyond to differ materially from those expressed in any forward-looking statement made by or on behalf of Greenbrier. And with that, I'll turn it over to Bill.

Okay. Thank you, Justin. Good morning, everybody. In the third quarter, Greenbrier's core North American business produced strong revenue and margin gains. Third quarter revenue grew by 30% compared to the second quarter and we achieved our highest consolidated gross margin of the year at more than 12%, an increase of over 400 basis points from last quarter. Manufacturing performance led the way for the gross margin of 13.3% as Greenbrier achieved these gains in our core business. The momentum we expected in manufacturing during the second half of the fiscal year is materializing, led by improved operating efficiencies and increased railcar deliveries. Another highlight of Greenbrier's third quarter included solid railcar activity, which we spoke to in the press release, and which Lorie and others will touch on this morning. We expect our strongest earnings per share of the year during our fourth quarter of fiscal 2019 in accordance with earlier guidance. Greenbrier's bottom line results in the quarter were impacted by non-cash goodwill impairment within our railcar repair operations, and that unit is continuing to undergo top to bottom review and reorganization. In a moment, Lorie Tekorius will speak to our specific actions to turn the repair operations to sustained profitability. Our Brazil joint venture also experienced an operating loss this quarter. We have been rightsizing the Brazil operation to reflect normalized demand and see this quarter as an anomaly. We expect deliveries to improve in Brazil beginning in the current quarter. As the Brazilian real concession renewal process ramps up, we expect deliveries to increase substantially in 2020 and beyond. Clearly, the results from our first nine months will result in lower earnings per share for fiscal 2019 than previously guided. I believe much of this is timing and some due to preoccupation with earlier, publicly announced…

Thank you, Will. Good morning, everyone. I'll briefly provide some more details on Greenbrier's operating performance before Adrian addresses the financial details and outlook. We delivered 6,500 railcar units and received orders for approximately 6,500 units, valued at $730 million. Orders in the quarter were for a broad range of railcar types, including tank cars, covered hoppers and boxcars. Our diversified backlog as of May 31 totaled 26,100 units, with an estimated value of $2.7 billion. I'll highlight the moving pieces in what was a mixed third quarter. As for the positives, as Bill reminded you, we announced the pending acquisition of the manufacturing assets of ARI in a transaction valued at $400 million. The production improvements predicted for the second half of the year began to materialize in the quarter, with a 40-percent-plus increase in deliveries, primarily in North America and strong margin performance. And improvements in Europe in Gunderson occurred in the quarter with stronger performance expected in Q4. On the flipside, the railcar repair business continued to struggle operationally and the Brazilian operations had a challenging quarter with minimal deliveries as a result of weak demand environment. Now, I'll give a little bit more color on each of our operations. Our North American manufacturing had a strong performance this quarter. I'd like to take a moment and thank the GMO team, led by Alejandro Centurion, for the hard work and successful production activity this year. We've increased production rates, while managing several production line changeovers. Several hundred employees were added safely across multiple locations. This is a testament to the strong manufacturing organization that's been built at Greenbrier over the years. In Europe, a meeting of the supervisory board was held in mid-June. The new management team led by William Glenn, in close collaboration with Martin Graham…

Thank you, Lorie. Good morning, everyone. Quarterly financial information and metrics are available in the press release and supplemental slide on our website. Given the discussion so far, I'll focus on a few additional details in the quarter and then provide additional information on our fiscal year 2019 guidance. Highlights for the third quarter include net earnings attributable to Greenbrier of $15.2 million or $0.46 per share, including $10 million or $0.30 per share of goodwill impairment at the railcar repair operation and $4.3 million net of tax or $0.13 per share of costs related to the ARI acquisition. Excluding these items, net earnings attributable to Greenbrier are $29.6 million or $0.89 per share. Adjusted EBITDA of $84.4 million was 9.9% of revenue. Revenue grew 30% to $856.2 million, our strongest quarterly result ever. Deliveries grew over 40% sequentially, reflecting the strong performance in North American manufacturing. Approximately 13% of our 6,500 units delivered were outside the North American market with minimal activity occurring in Brazil. Internally-produced syndication activity was strong again this quarter, with 1,500 units delivered in the quarter. Approximately 10% of the 6,500 unit orders in the quarter were from international markets. Aggregate gross margins of 12.4% significantly improved from Q2, led by a substantial increase in manufacturing gross margin to 13.3%. We expect gross margins to continue to improve in Q4. Manufacturing gross margins increased 640 basis points from Q2 and were almost 200 basis points higher than Q1. We generated over $50 million of operating cash flow in the quarter. Greenbrier's balance sheet continues to be strong and flexible, with nearly $360 million of cash. Upon the closure of the ARI acquisition, we expect to continue to have strong liquidity. Revisiting the subject of working capital, although higher sequentially, inventory levels started to decrease during…

Thank you. [Operator Instructions]. Our first question is from Justin Long. Go ahead. Your line is open.

Thanks. And good morning.

Good morning, Justin.

Morning. Maybe I could start with the orders in the quarter. I think they were probably better than most people expected, just given what we've seen with rail volumes and some of the macro uncertainties. Can you give us a little bit more color on the order environment? Is what we saw a pickup in demand sequentially or is it more related to Greenbrier getting market share? And then, any thoughts around the order environment going forward as well?

I'll let others comment, but we had a mixed grouping of orders throughout different car types. Obviously, some areas of the car portfolio are benefiting stronger than others. So, the petrochemicals and tank cars are still a strong demand. And even autos continue to show some strength. But I understand the view that the business is affected by declines in loadings. Actually, we have a different approach to market. And we still see strong visibility in the demand for railcars across our railcar portfolio. Lastly, I'd say that, while we did have an adjustment in Europe and in Brazil, we do expect those franchises, which we believe to be very valuable, to turn around and so we're going to get some good tailwinds in the future, I think, from both of those markets. We're well on our way to fixing the European model and the orders we're taking there have strong margins in them. If you want to give more color…

I think that's great color, Bill. Thank you. Just to emphasize, there was broad-based demand across all different car types, led a bit by the petrochemical industry, but we saw demand, I think, in every car type.

And, Justin, just to tack on to what they've said is, there is a lot of activity around and a lot of discussion around PSR and railroads owning fewer cars. But, again, as you've talked about before, that's not necessarily new news, but it does mean that shippers and lessors will need to own more cars, and so we're seeing a little bit of that benefit as well.

That's really a great point, Justin. On that point, I want to just to speak to Greenbrier's strategy and model as it relates to this question. All of you have been watching the public comments of other companies, recognizing Greenbrier's trajectory is somewhat different, we are a manufacturing, engineering, origination and asset management company. We also have a strong aftermarket service business bundled together with all of that. We are in business to support our customers. Our customers include some very strong leasing companies, companies we've done business with for years and years, and we expect to continue to hold out product and to give product to those companies. We're very positive about the fact that ARI has strong relationship with GATX with whom we've dealt in the past. The industry needs to be able to not only – we need not to compete with our base of customers. In our case, we don't intend to do that. We intend to serve these customers and it serves us very well by feeding the machine and the integrated business model. So, I just wanted to add those two comments. I think we're getting some halo effect from that.

Okay, that's all helpful. It sounds like, going forward, your expectation on orders is that they should be relatively stable sequentially, is that fair?

I think that is a fair statement. While we're not disclosing orders received during the fourth quarter, we have seen robust activity and expect that to continue.

Okay, great. And then, secondly, and I'll pass it on, the build rate has been increasing sequentially every quarter this year, but I wanted to see if you had any initial thoughts about the production levels you will be targeting as we get into fiscal 2020. So, if I look at that fourth quarter guidance for 7,000 to 8,000 builds, is that the rate of production we should be thinking about for early next year as well?

Nice try on your effort to get the guidance for 2020.

I had to try.

I'm surprised you would want it since we kind of booted the guidance for 2019. But we do have very good momentum under our model on the commercial site, in relationships with customers, producing good products at a high rate of reliability. These things generally paid off. I don't agree with FTR that there's going to be that big of a shift, certainly by 2020. So, there is still momentum in our model for next year, and that will define what we do. We've given you some visibility for this quarter in that regard and I'm afraid that's about all we're going to say about it.

It wouldn't be a Greenbrier call if you and I didn't have a bit of a conversation back and forth.

That's certainly true. Yeah.

I would remind – you guys all know our production rates are very dependent on the car types that we're building and the timing of when our customers want those cars. So, depending on that need that will moderate or could moderate some of our production rates.

True.

Okay, fair enough. I'll leave it at that. Thanks for the time.

Our next question is from Matt Elkott from Cowen. Go ahead. Your line is open.

Good morning. Thank you, guys. Just a follow-up on the delivery question. Did you guys tell us how much of your current backlog is for fiscal 2020 deliveries?

So, Matt, this is Justin. Right now, we're sitting with about 60% of 2020 activity in our backlog. Please don't try to triangulate further because it will only get muddier. But that's kind of what we're prepared to say at this point. So, we're entering 2020 in a very good situation again.

And I would just clarify that Justin's interim 2020 is based on a May 31 number.

Correct.

So, we still have another quarter to go of commercial activity to bolster our production schedule. And as you guys all know, at Greenbrier, we love having flexibility. We don't enjoy being fully booked up because it doesn't give us the opportunity to take advantage of near-term or short-term demand.

But Matt, I'd like you to – and thanks for joining us today. I'd like you to focus on the remarks I just made. We are in the middle of what is essentially a differentiation between the major car builders, those who lease which we do, those who serve customers and engineer, those that are potentially moving toward more of the leasing content. We will benefit from this differentiation because those leasing companies with whom we've had strong relationships, and others like GATX, we hope to have strong relationships in the future, need to make commitments for product and they need someone who is reliable to produce that product for them. We intend to be that company for those customers with whom we've had a strategic relationship. This will be a factor that you can't read about really in the literature on economics or industry forecasts. I think it's going to be a differentiating factor for Greenbrier. And there's multiyear orders that are coming up in that regard.

That's very helpful commentary. And I know the ARI acquisition has not closed yet, but to go back to the order front, do you guys think that some of the order activity that you've got in the quarter which was very strong was influenced by the fact that people know that you're going to be ARI as well in the future? In other words, had you not announced that ARI was going to be your company, maybe you would not have gotten these many orders?

Personally, I don't believe that. I think the reaction from customers has been almost universally positive because it diversifies our product and it's a parallel product line giving us geographic diversity. I think it strengthens our position to serve our customers. I think our customers are happy about that, apropos my earlier remarks a few minutes ago.

Got it. I don't disagree with that, Bill. I was just wondering if customers know that you're going to be ARI, so they're placing orders with you knowing that you're going to have that capacity going forward for tank cars. And just one final question. As you noted in my prepared remarks, there are many weak spots in rail traffic. Everything is pretty much down except for petroleum products. Intermodal, grain is going to be weak for the foreseeable future. Frac sand has basically declined significantly. Is there any – are you getting any calls from your customers about potential deferments of grain cars or frac sand cars or intermodal equipment?

Lorie?

Matt, this is Lorie. I would say that you're spot on, that there are some areas of weakness. What I would add, just for some additional color, is when we've had customers who are seeing – who have placed orders and are seeing weakness in particular car size, we will work with our customers to find a way to make it be a win-win situation for both Greenbrier and our customers where, because we have such a broad product mix, we can sometimes work with the customer to shift – let's say, they've ordered a particular car type and they would prefer something else because they are not seeing the same strength that they thought they were going to see. So, I do think that there is a potential for that over the rest of calendar 2019. But we believe that we have demonstrated that we know how to work with our customers and we try to find that solution as beneficial for both.

So, we are having at least one conversation with a prospective customer on that score. We also have – in the intermodal area, that's been hit with the intermodal loadings down and trade affecting intermodal. So, we have had very positive discussions, redeploying some of our capacity to do freight cars in an exchange of capacity types, but not to our financial detriment at all. This is what I said. We're very flexible. These long-term customers produce long-term revenue streams and cash flow for us. We have to keep them happy. That's the nature of our business. And there's a limited number of these big players in the marketplace. So, we have to pay close attention to them. We also have very strong and solid competitors – National Steel Car, Trinity Freight Car and others, Union Tank Car. So, we have to keep on top of our game, and that means satisfying your customers.

Great. Thank you very much.

Our next question is from Mike Baudendistel from Stifel. Go ahead. Your line is open.

Thank you. Just wanted to ask you on your updated delivery guidance. Just looking back at my model, looks like it was about 1,400-unit delta versus sort of what I had before. And I'm just trying to understand sort of what happened there. I was under the impression you sort of knew what you were going to build and what build slots and there was more visibility there.

Sure. Mike, I'll answer that question. As we've encountered at different times, when we enter a year, we do our best to provide guidance and expectations based on the visibility we have. There are times when the timing or disposition of production activity can shift. So, that's what you're seeing, is a shift in primarily that disposition activity, as well as a little bit of weakness coming out of our international operations, Europe and Brazil. That being said, fourth quarter will still be a very strong delivery quarter and we expect it to be a very strong earnings quarter.

And I just have to step in and say, with respect to that weakness, which we tend to look at – sometimes we tend to look back, we've got to look forward to the quarters to come and the years to come. We think both Brazil and Europe are great franchises. To have a good franchise and build a franchise, you have to lose some games. In Europe, we booted it. We made a management change, that new management with William Glenn coming in. Just came back from an Amsterdam board meeting. They are really doing a great job reorganizing and I think that good things are on the way there. So, we just had a blip, and I think it's largely timing of that franchise kicking in. Same thing at Brazil. Brazil has got some really good opportunity there. When these concessions are awarded in Brazil, the concessionaires have to buy new equipment, invest heavily as part of the government mandates. So, they put billions of dollars in each of these concessions. Now, Rumo has received its concession or is about to. The others are going to be tracking closely behind. And the problem down there for them will be that there is a limited car capacity in Brazil. It will be for a period of time a sellers market, but the question is when. Certainly, in this quarter, I think we've built 15 cars, an anomaly. I think, in future quarters, we'll see gradual improvement. As soon as the concessions are awarded, I think we'll turn around with visibility in the next four to five years.

Got it. That's helpful. And just also wanted to ask you, I know you said you don't want to say much on ARI, but just wanted to ask you to make sure that sort of the statistic you said at the last call on that in April that being 20% accretive, the $30 million in synergies, timing, you expect to close by the end of the year, early next fiscal year. All those things are all still relevant.

Yes. All of that is still relevant. That's still what we believe.

Got it. That's all I had. Thank you.

Thank you.

Our next question is from Matt Brooklier from Buckingham Research. Go ahead. Your line is open.

Hey. Thanks and good morning. Any sense as to how much of a margin or profit headwind, some of the hiccups that you had in Europe were on the quarter? I'm just trying to think of sequential progression in terms of the margins here.

That's a great question. Lorie is prepared to answer that question, or Justin or Adrian or me if they fail to answer it. That was a lot. Justin?

So, the European impact was about 100 basis points to 150 basis points in Q3. We would actually expect to see another step-up in our margins in manufacturing in Q4 as Europe starts to return to a little bit more of a normalized level. So, kind of in line with what we've been saying all year, continue to see the stairstep progression and we'll see quite a bit of strength as we have our current run rates for the entire quarter, especially in North America.

Manufacturing revenues will step up in Q4 and also the margin will step up. So, we'll get a double benefit.

I think what you might be looking for is just an order of magnitude in terms of the headwinds that we had in the quarter. I think the number is something like, between Europe and Brazil, which we think will not repeat. It will turn into a tailwind relatively speaking. And it was close to $10 million, wasn't it?

Yes, that's correct.

All right.

Okay. That's all inclusive, headwinds and fiscal 3Q with everything.

That's just for those two parts. But repair was another big lump. So, as we work off – and we're well underway in repair in Europe to normalcy. In Brazil, it's a little more of a wildcard, but it's not going to be the aberration that it was in this quarter, at least we hope, knock on wood. We can look at this from a relative perspective. The quarter was quite noisy with unexpected residual legacy issues after we had announced a write-off last quarter. We thought we had this pretty well corralled, but dogs and cats kept coming homes and we think we've got most of those corralled now. But that's what we think and we're expecting – relatively speaking, a positive from these areas as it relates to the drag we were carrying in the Q3.

And just to be very, very clear. From a gross margin perspective, if you take into consideration repair operations, Brazil and Europe, you are talking about $10 million.

Okay. And then, second question, with respect to the repair operations, you've closed a couple of locations. What's left to do with that business in order to return it to your targeted margin goals and would you ever consider potentially selling that asset if you're not able to hit that target?

Sure. So, we just brought our legacy operations back into Greenbrier in August. So, while for some of us, it feels like it's been a long time, it really hasn't been that long, and I would say that we're moving fairly efficiently through an optimization and review of each of those facilities, working closely with some of the customers that we service in these geographic areas to see if there is a solution to us becoming more profitable. I think that by the fact that we've closed 4 out of 12 locations in just nine months, it goes to the fact that we are working quickly if we cannot figure out a way. We've also seen good operating performance improvements at several of the locations. So, we don't get into the details facility by facility, but we have set a very tight timeline to come to a final optimization of this network by the end of 2019. And again, we're taking into consideration a lot of things including how this network or this activity that we provide, how it works with our management services operation from an integrated business model perspective. As you are aware, we manage over 300,000 railcars for the North American fleet. As part of that management, oftentimes, we are managing the maintenance activities associated with those railcars. So, we're looking at these two activities as they go hand-in-hand.

Okay, very helpful. Appreciate the time.

Our next question is from Bascome Majors from Susquehanna. Go ahead. Your line is open.

Yeah. Thanks for taking my question. You talked a little bit about positive operating cash flow in the fourth quarter. Can we back it out and look at the full year? Is that swinging in some of the working capital headwinds you guys could have? Is the levy significant enough to deliver a positive operating cash or even free cash flow number for the entire year? And maybe a little bridge to – if that's something that could reverse, if not in the next quarter or next year. Thanks.

So, Bascome, this is Justin. I would say that, probably at this point, we'll be getting close to breakeven on an operating cash flow basis for the year. It's just that, with the robust working capital build, including inventories, but also since railcars held for syndication, that will – it's definitely reversing itself on the back half, but is also – we don't sell those assets down to zero as we enter the next fiscal year. We do carry some of that. So, we will be expected to have a strong fourth quarter, which will get us closer to breakeven on the operating cash flow and then will position us well for 2020.

Okay. And I know you had some questions on next year earlier and understand the reluctance to speak to it. But there's certainly a wide range of investor expectations out there and you've been willing to at least kind of share some directional thoughts on the outgoing year, even one or two quarters early in the past. From the $3-ish bogey for the full year that we sit at today, any sense of where this backlog cover gets you for next year? What are the range of expectations in your world [ph]? Just anything you can give us to help us a little bit, to get some comfort with at least the first quarter to next year, I think, would be really helpful. Thank you.

Well, I'd say that we're excited with the momentum that we've achieved in the third quarter. We expect fourth quarter to continue that growth. We've mentioned that the North American market which is our largest market where we service over 370,000 railcars – I was corrected understating, so sometimes my conservatism can come out. But we're excited. Again, choppy market, the North American market. So, we don't want to be overly aggressive. We also have the fantastic opportunity to close on the manufacturing assets of ARI. So, it's going to quickly become difficult to distinguish between what is legacy Greenbrier and what is this combined network because we're going to be very focused on quickly assimilating and combining these operations and not continue to run them as distinct units. So, I would say – and this is saying a lot for those of you that have been following us – I'm excited about what our expectations will be for 2020. And I think that I'll turn it over to Justin or Adrian to see if they want to moderate my comments at all.

I wouldn't do that because they may do so. Look, that's a very optimistic positive statement from Lorie, for those of you who know Lorie's history as the chief financial officer. I think that we've got a company that is – from this current guidance you can construct $320 million – correct me, Justin – of EBITDA for the quarter. You can construct what is the earnings per share. It seems to me we'd be hard-pressed to do worse than that, but I – next year, with baseline – we have changed the model dramatically. We have some real optionality in the international business as stuff can turn very quickly. We still have the Saudi Arabian optionality in the mining industry there. They're investing heavily. We are still trying to conclude the joint venture activities over there. So, these things can pop and break to the good as well as to the bad. So, we've been beating ourselves up a little bit about not performing as well as we had hoped, but the truth is we've got a company that's undervalued with high dividend yield, a lot of strength in its balance sheet, a strong cash flow as we normalize production and inventory levels, we just hit record revenues, we're going to hit a record revenue for the quarter, we're running at a $4 billion rate if we can keep that up, the industry in North America is declining a little bit arguably, but I think the Street is looking for any negative news against the 10-year cycle. But our company is a lot different and a lot stronger than it was in the beginning of the last downturn. We're all looking for the beginning of the last. And the next downturn, it just doesn't look like in an election season that that's going to happen unless there is a shock from the outside. So, baseline, I see a very – it would be very difficult for me to see how we do worse. Now, I don't want to curse this by saying that and then having something happen. So, that's kind of the best outlook we're going to be able to give you, I'm afraid. But I think it's very positive. I agree with Lorie.

That's a – Lorie, to hear it from you with your history of conservatism. That's good to hear and I'm glad to hear that you guys are optimistic and we'll wait and see what you have to lay out for us in October. Thank you.

Thanks, Bascome.

Thanks, Bascome.

Thank you, Bascome.

And our last question is from Steve Barger from KeyBanc Capital Markets. Go ahead. Your line is open.

Thanks. Good morning.

Good morning.

Hi, Steve.

Hi, Steve.

You've talked a lot on this call about international getting back on track. And just for Europe specifically, can you give us any more specifics on the commercial plan in terms of how you're changing your market strategy? And I'm just trying to gauge market opportunity versus the more recent reality.

Yes. We're going to stop doing stupid stuff, number on. That's a quote from the Navy, Admiral Fargo on our port, once you stop doing stupid stuff and the good stuff comes along a lot easier. We have William Glenn who is a veteran of our – as chief commercial officer, he's working very well with Alejandro Centurion. So, number one, we're screening customers. We're being much more selective about customers. And we took some really bad contracts, earlier administration. We weren't watching the store. We integrated well on all of the details, but we didn't pay attention to the business that they took on during the transition when we were seeking regulatory approval. Once they took that business on, then they made a second mistake of deploying too many cart blinds and too many factories. They should have specialized. William has got and Martin Graham, who is an industry veteran, have got both of those areas contained. That itself will make a major difference. The margins that they are seeing – we had some margins in the legacy contracts that were taken before the deal was approved that are producing 25% losses, and it's really tough to make money when you've got some major state-owned companies like BB producing at 25% loss. And there is no quarter over there in that environment if you make that kind of a contract. [indiscernible]. So, I think they've made a tremendous difference. They've put – William used to run Europe. He's very experienced with customers. He's calling on the right customers. I'm optimistic he will turn this around. Just looking at Europe alone, the shift from the negative we had to the positive we expect in the next few quarters will make a big difference in our bottom line and it will continue to improve. Now, the downside is European growth is not as – it's kind of flat. There's a lot of trade-related issues over there. Lot of noise. Brexit and so on. But we're still seeing a reasonably strong market and we're booking orders. And more importantly, we're building strong relationships over there with companies that we had neglected to go for some of the big German companies. So, that was a mistake. We corrected that mistake as well.

Got it. Thank you. Of the 6,500 orders this quarter, how many were international versus domestic?

About 10% international. Balance was domestic.

And would you expect a similar mix in fiscal 4Q?

Broadly.

All right. And just one last quick one. Bill, you made the case that the stock is undervalued versus all you've done and all you have going on, but free cash flow has been hard to come by over the last couple of years as you've made these international investments and the leasing actions. Is it reasonable that 2020 gets back to free cash flow generation or are there still some investments and headwinds yet to come that will still keep that more depressed?

Well, as to the general strategy, I think we have to digest what we've done. If we can get top line revenue, make that profitable at a $3.5 million run rate to $4 million run rate, if that could be achieved, that would be great. But we better be sure that the blocking and tackling is all being done. So, what does that mean for working capital? We should be able to tighten down working capital, be aggressive about G&A costs, look at capital allocation very closely. We do intend to continue our dividend. But we want to be sure we have a strong balance sheet for contingencies that are more downside type contingencies as opposed to looking for continuing its rapid pace of growth. We're not going to be doing any more international acquisitions in basic plan. But we're open always to opportunities. But we're just really trying to button things down in 2020 and get the house running in good order.

So, unusual leasing things notwithstanding, you would expect better operating and free cash flow next year?

Yes.

Yes.

Yeah.

All right, thanks.

Thank you.

Thank you very much everyone for your time and attention today. And if you have any follow-up questions, please reach out to me. Have a great day. Thank you. And a happy Fourth of July.

That concludes today's conference. Thank you for participating. You may disconnect at this time.