Ladies and gentlemen, thank you for standing by and welcome to the Third Quarter 2021, Huntington Ingalls Industries Earnings Conference Call. At this time, all participants are in listen-only mode. After the speaker’s presentation, there will be Q&A session to ask a question. Please be advised that -- please be advised that today's conference is being recorded. If you need further assistance, please signal a conference specialist I will now like to hand the call over to Dwayne Blake, Vice President of Investor Relations. Mr. Blake, you may begin.

Thanks. Good morning. And welcome to the Huntington Ingalls Industries, Third Quarter 2021, earnings conference call. With us today are Mike Petters, President and Chief Executive Officer, Chris Kastner, Executive Vice President and Chief Operating Officer, and Tom Steely, Executive Vice President and Chief Financial Officer. As a reminder, statements made in today's call that are not historical fact are considered forward-looking statements and are made pursuant to the safe harbor provisions of federal securities law, actual results may differ. Please refer to our SEC filings for a description of some of the factors that may cause actual results to vary materially from anticipated results. Also, in their remarks today, Mike, Chris, and Tom will refer to certain non-GAAP measures. Reconciliations of these metrics to the comparable GAAP measures are included in the appendix of our earnings presentation that is posted on our website. We plan to address the posted presentation slides during the call to supplement our comments, please access our website at huntingtoningalls.com and click on the Investor Relations link to view the presentation, as well as our earnings release. With that, I'll turn the call over to our President and CEO, Mike Petters. Mike.

Thanks Dwayne. Good morning, everyone and thanks for joining us on today's call. This morning, we released third quarter 2021 financial results that included another quarter of consistent shipbuilding program execution. Let me share some highlights from the quarter starting on Slide 3 of the presentation. Sales of $2.3 billion were up 1% from the third quarter of 2020 and diluted EPS was $3.65 down from $5.45 in the third quarter of 2020. New contract awards during the quarter were approximately $600 million, resulting in backlog of approximately $50 billion at the end of the quarter, of which approximately $24 billion is funded. Shipping to activities in Washington, the federal government began the new fiscal year under a continuing resolution, which funds government operations through December 3. And we continue to urge Congress to proceed expeditiously and remain optimistic that the defense appropriations and authorization processes will be completed in the months ahead. As bill's progress through both chambers of Congress, we continue to see bipartisan support for our programs reflected in the defense appropriations and authorization bills in the House and the Senate. We're pleased that the 4 defense oversight committees have shown strong support for shipbuilding to include adding a second, Arleigh Burke-class destroyer, which is a navy -- a top navy priority for fiscal year 2022. The appropriations bill also include language in support of a DDG 51 follow-on multi-year procurement contract in FY23. So, as I prepare to close, let me give a quick update on COVID-19. We continue to work with our customers to satisfy the requirement for federal contractors to have their workforce vaccinated against COVID-19 by December the 8 2021. At HII we remain committed to promoting and protecting the health and safety of our employees, their families, and their communities, and continuing…

Thanks, Mike. Good morning, everyone. I'm very pleased to report another solid operational quarter. With that, let me share a few highlights. At Ingalls, let me first provide a brief update on the pending contract awards LHA 9, LPD 32, and 33. We still believe that a bundled acquisition of these critically important shifts is the most cost-effective method of procurement and are pleased that the Navy and Congress have protected the shift schedules with a contract for long lead material on LHA 9 coupled with continued support for LPD 32 and 33, Shifting the program status, LHA 8 Bonneville (ph) continues to achieve cost and schedule performance in line with our expectations. We're making steady progress through the structural erection and initial outfitting phases of construction. On the DDG program, the team successfully completed acceptance trials for guided missile destroyer DDG 121, Frank E Peterson Junior, and expects to deliver the shift to the Navy by the end of this year. In addition, DDGs 123 and 125 remain on track to complete sea trials next year as planned. On the LPD program, LPD 28, Fort Lauderdale was christened in August. This ship remains on track to complete sea trials during the fourth quarter with delivery to the Navy planned in the first quarter of next year. Our Newport News CVN-79, Kennedy is approximately 84% complete. And the focus remains on compartment completion and key initial propulsion plant milestones. Regarding the sensitization of a single-phase delivery contract modification, we have reached agreement on a cost and schedule impacts with the Navy and expect to execute the contract modification late this year, or early next year. On the RCOH programs, CVN-73, USS George Washington continues to achieve key propulsion plant milestones and is approximately 92% complete. And CVN 78, USS Gerald…

Thanks, Chris and good morning. Today, I will briefly review our third quarter results and provide an update on our outlook for 2021. For more detail on the segment results, please refer to the earnings release issued this morning and posted to our website beginning with our consolidated results on Slide four of the presentation. Our third quarter revenues of 2.3 billion increased approximately 1% compared to the same period last year. This is due to growth at Technical Solutions driven by the Allied acquisition, which was largely offset by a decline in revenue at Ingalls primarily due to lower volumes on the NSC, DDG and HLA programs. Segment operating income for the quarter of a $163 million increased $1 million comparison the third quarter of 2020 and segment operating margin of 7% was in line with the results from the prior-year period. Operating income for the quarter of a $118 million decreased by a $104 million from the third quarter of 2020 and operating margin of 5% decreased 455 basis points. These decreases were almost entirely due to a less favorable operating FAS CAS adjustment compared to the prior year period. The tax rate in the quarter was a negative 4.3% compared to 1.8% in the third quarter of 2020 to decrease in the tax rate was primarily due to additional research and development tax credits for tax years 2016 through 2020 recorded in the third quarter of 2021. Net earnings in the quarter were 147 million compared to 222 million in the third quarter of 2020, diluted earnings per share in the quarter were $3.65 compared to $5.45 in the prior-year period. Third quarter 2021 results include approximately $15 million of non-recurring pre -tax transaction expenses related to the acquisition of Alion. Excluding the impact of pension diluted…

Thanks, Tom. As a reminder to everyone on the call, please limit yourself to 1 initial question and one follow-up so we can get as many people through the queue as possible. Operator, I will turn it over to you to manage the Q&A.

We will now begin the question-and-answer session. If you're using a speakerphone, please pick up your handset before pressing the keys. At this time, we will pause momentarily to assemble our roster. Our first question comes from Myles Walton with UBS. You may go ahead.

Thanks. Good morning.

Good morning, Myles.

Was hoping I could just start with the shipbuilding revenue outlook and maybe less specific to the revenue outlook, more specific to what you're seeing in the labor workforce and moving to the low-end of this range. Is that anticipating things that you haven't seen yet as it relates to the covered mandate and what it could do to attendance, and workforce, or is it more of what you saw in the third quarter? If you get where I'm going.

Hey, good morning, Myles, it's Tom. I'll start with that one. So, from an outlook perspective, we did go to the bottom end of the range. As you recall, we gave you 2 to 8 for the beginning of the year. As we see how the quarter played out right now, what's left in front of us right now. We -- when I move to shipbuilding revenue expectation that $8.2 billion. A couple of points on that right now, we're a little light on material specifically at Ingalls. If you look from a Newport News perspective, net revenues were flat. Obviously, a little look back from a PTC perspective, but when we're talking about shipbuilding, the material lag behind roughly about $40 million in the quarter. And as we look forward into Q4. All right. That could persist. You don't see significant labor oppression at this time that's going to impact our revenue. We have a keen on right now with the EO and the mandate and how that's changing very dynamic situation there, as well as keeping an eye on our supply chain to see how the material flows here. But it's just timing right now as we see the outlook. And as I say, it's still in the range that we gave you at the beginning of the year.

Okay. And what is the percent of the workforce that's currently vaccinated and if there were perturbations, is it covered in your contracts because it's a new requirement being placed upon you.

Right. Miles, this is Mike. Right now, we're, I'd say, roughly around 75%. We've seen a tremendous uptick in the last 30 days and folks getting the vaccine. I think the breaking news right now, it looks like the executive orders being moved out into January and the -- and they're talking about having your shot by January, not completely through the quarantine. So, we're going to have to interpret it how all that plays out. We're working very closely with our customers on how do you implement the executive order. I mean, the executive order is -- we've been -- we have been, from a policy standpoint, we have been directly aligned with what the white house put out. But as you hinted at there, the executive order is not contractual. And so, working with our customers on all of our contracts to figure out how best to implement that executive order is what we're doing, and we're doing that across the board. So, we're continuing to move ahead. Our ambition is to get as many of our employees vaccinated as we possibly can because we are committed to a safe workplace and we think that's the best way to do it.

Alright. Thank you.

Our next question comes from Doug Harned with Bernstein. You may go ahead.

Good morning. Thank you.

Morning,

.

Right now, you are in the transition on Virginia-class for Block-4 to Block-5, could you comment on how block 5 looks in terms of the amount of content you have on that, and how would you describe any risks in the transition relative to the one you did when you move to block 4.

Well, I'll start and then let Chris pick it up. When we kicked off block 4 the contract took quite a while to negotiate that contract and as a result, there was some late material procurement, material that kind of helped, helped us get off to a rocky start relative to that program as well as the ramp up in production. So, we had a lot of things moving, a lot of parts moving on the beginning of block 4. But we don't have any of those partners moving at the building of block 5. And so, we're -- the transition for us is moving basically, seamlessly from block 4 into block 5, pretty excited about that and pretty optimistic about where that's going to go.

No, I think that's right. And when you think through VCS and block 4 getting back to a cadence where we're floating off 1 vote a year and delivering 1 vote a year and then transitioning that workforce right into block 5 makes great sense. So, we have high hopes for performance on block 5 because of the lessons we're learning through block 4 when you get to a 2 per year cadence.

And then, also in submarines, you commented this time that your services revenues were down a little bit. Can you comment on where the 3 Los Angeles class ships stand in their process and how you see services, revenues at Newport News trending over the next couple of years here?

Sure. Helena will -- this is Chris, Doug. Helena will deliver this year. Columbus is in process and moving through the cycle in their contract and Boise is really in their prompts start period. We're going to get into a place here. And I think in communication with our customer where it makes great sense to have sort of a consistent stream of work and revenue. It probably will not be as high as it's been going forward and we need to create that plan with our customer. That's the status of the three that are in Newport News now. And as I said, we're working with a customer to ensure we had a steady cadence of repair activity going forward.

Okay. Very good. Thank you.

Sure.

Our next question comes from Seth Seifman with JP Morgan. You may go ahead.

Thanks very much. And good morning, everyone.

Good morning.

I wanted to start off. I think you mentioned a bit earlier that you were looking to finalize the single pay delivery agreement for the carrier with the Navy either late this year or early in 1Q. Again, can you tell us is there any margin or cash impact we should think about once that is finalized?

Yes. This is Chris. We will definitize that, if not this year, it would be beginning of next. Don't anticipate significant or margin cash impact. It's obviously an increase in the top-line for that shift, but it also extends the risk retirement events out a couple of years because it extends the test program. So, nothing significant from a material from a sales margin or cash impact at this point.

Okay. And then it seems like it's mostly a timing issue, but just wanted to ask about the cash flow guidance increase this year. Should we think about that increasing your kind of 5-year expectation or is it mainly having to do with the timing of when those progress payments go back to the government?

Good morning. It's Tom. Yes, it is. The progress payments are the predominance of the change that we have right now. Obviously, another quarter with rich retirement, and we have actual -- through Q3 and we have a line of sight for the end of the year, but predominantly the change there was because of the progress payments not getting kicked into the 2022-time frame. Keep in mind to that year-end, we have to get back half of the payroll bike attacks that we did not pay in 2020. So that's baked into the numbers. So, it's timing and within the 32, it still holds.

Okay. Thanks very much.

The next question comes from Ron Epstein with Bank of America. You may go ahead.

Yeah. Good morning, guy.

Good morning.

I was wondering if you could give us just some more color and maybe just following up on Miles’s question about what's going on in your supply chain, where you're seeing some material shortages and is it just being driven by delays in transportation or what are good.

Sure. Yeah, it's Tom here. I will take that one. So, we've had this conversation on the last couple of calls and we're watching that and intently, regularly to touch base with the supply chain offices out Cabot, each of the yard, some of speed exactly on where the stand right now, as we've given in the past, because of the nature of our long-term contracts, long-term material orders that start ahead of the construction of these contracts. And then obviously with the backlog that we have this spin-off contracting, you have line of sight of the work that's going to be performed in the yards. A significant amount of those requirements has already been put on order and we're managing them aggressively over the next material flows in hits the end-year need dates. Preponderance of the material is coming in on time and meeting the contractual needs that we have within the art. I would tell you that recently, less 3 to 6 months that as we have spot orders, what we're seeing is a little bit of volatility in pricing and the validity days of shrinking a little bit on things that we have spots high. But from a perspective of Execution of the existing contracts we have we don't see a significant impact at this time. Obviously, we're watching how the EO mandate impacts a supply chain. And the precious that we do, we do here are our second and fifth third tier were dependent on the raw materials. So copper cabling, things of that nature. But again, as we stand here today, the supply chain that we need because of how we've contracted at work in advance, has us maintaining schedule at this time.

Okay. Got it. All right. Thanks for that. And then on the Technical Services business, if we just open up the aperture a little bit and think about when we walk out 2, 3, 4 years from now, where do you see the margin in that business? I mean, presumably it's going to be much better than where it is today. And I'm just curious, I mean, if you can just give us -- I know you're not giving forward guidance, most companies don't do it. So, I'm not asking for that but just -- if you can put a little framework around how we should think about the margin in that business as we think longer term.

Yes. So, because of how we put that division together with the acquisitions, purchase, intangibles, and things of that nature. If you noticed, we've been guiding and driving towards an EBITDA relationship against the performance and where we see. You've noticed from the announcement we had on the July time frame and then with July, close in August, we've got on how that was going to cause a lift there. From a rough perspective, we were at 45%. We dialed in from an EBITDA perspective to be in the 8% to 10% range by 2024. Both the initial guidance we gave you in the July time frame of Alion supported that. As we sit today after the close in August and that close to the quarter with Alion cranked into our financials. They're hovering on the low end of the range right now so that's good news because that's more than 50% of that portfolio. I think going forward as we see those purchase intangibles get burnt off for the next 3, 4, 5 years going forward, obviously that's going to be an improvement. I would tell you that PI is baked into the rocks, although the rocks, even for this quarter TSD is 2.6% with $8 million of purchase intangibles when you roll that out at the 5.3% last quarter and the EBITDA is at 7% right now. So that's a near-term perspective and how I see it evolving in the out years.

Okay, great. Thank you.

Our next question comes from George Shapiro with Shapiro Research. You may go ahead.

Yes, you had mentioned that the margin and Shipbuilding in Q4 of the similar to Q3 because some. Items moved to Q3. Can you just list what moved to Q3? And I thought you'd mentioned some might have moved to Q1 were so Next year. What do we expect in Q2 -- in Q4 for incentives versus what we had thought before?

Hey, George. It's Tom here. Good morning. Yes. I'll take that. Just a couple of moving parts there. We guided Q2 going into Q3 would be licensed for it would be a little bit heavier than that. We have pulled a couple of incentives at Newport News on the RCOH fund from 73 to the left, as well as before? Ingalls taken DDG 121 to trials was a risk retirement evaluation on a bad so just a couple of moving parts there from Q3 to Q4. But we're still in the lane there of the 7.5% to 8% that we gave you for shipbuilding, for year-end. I didn't mention anything moving into next year. In my remarks, we do have LPD 28 moving or staying on contracting in the beginning of 2022.

Okay. And then just a separate one, probably more for Mike. I noticed that Newport News you got like -- they're a union contract with perfecting 50% of the workers up to November here now, so if you could give us what you think about the status here. I mean, I guess it's more in the news given the contract results at the end of the year.

Yes. George Oliver. George, I'll start. This is Chris. We're in process with the Newport News union working through that contract with a very good relationship with them and I fully expect we can come to a reasonable agreement on a contract. I know Mike ran Newport News for a while, so he probably has for a long time actually, probably has better comments on that, but we're working with them every day to try to get to a resolution.

Okay, thanks.

We pride ourselves on having very constructive relationships with our labor partners and I don't think this will be any different than that.

Okay. Thanks very much.

George.

Our next question comes from Richard Safran with Shapiro Research. You may go ahead.

Thanks. Good morning, everybody.

Good morning.

So, it's -- on the Navy's new destroyer crews or class, the ship doesn't appear to be slated to arrive until very late in the decade. Correct me if I'm wrong, but I think that represents a bit of a slide to the right in terms of schedule. Could you discuss a timeline for a competition and following up on your opening remarks, I'm wondering how you think that the Navy strategy with the new ship now impacts to buy the new flight of DDG 51 since the new ship isn't arriving. Now for close to ten years down the line. I'm thinking that really reinforces the idea of a new flight of DDG, but that's my view is I was wondering what you think of that.

This is Mike. I don't think you're too far off there, just in general. I think general principles are -- it's really hard to pin down the development, path, and timeline for a new program like this, this early in the process. They are trying to work through -- how do they fund the design, how they fund the project? When are they going to have it, where the requirement is going to be? That's a pretty dynamic thing and so trying to pin that down precisely. It is a bit of a challenge. And our general view is that you don't really want to stop production of a line until you're ready to move to a mature design product going forward. So as that product matures, it will interact. The construction work that's going on So, DDGs today, the flight 3 ships will -- my -- we certainly will advocate and believe that the best prudent course ahead will be to continue to build flight threes until that designer is maturing. We're ready to go into production on that. And if that happens to be 20 something else, then it's 20 something else, and then we will be ready. As far as the competition for that goes, it'll -- that will just lay in as that program matures, we'll get more visibility into what the competition -- when it might be, what it would look like, and that sort of thing. I think it would be a mistake though for there to be any sort of curtailment in the destroyer program. Anticipating some kind of maturation path. We kind of went down that path in a couple of programs during my career, we've done that with submarines. We did that, actually, with DDGs and we tried to transition over to the 1,000s and then transitioned back. So, we had a gap and then short program. Our industry is full of people who have seen gaps in production become tremendous problems for restarts of production. So, let's keep the production line moving. And when the production line, when the design to churn off to transition, we will transition it.

Okay. Thanks for that. And, you know, more general, I thought you could talk a little bit about efficiency initiatives while back we had things like digital transformation, but I thought you might discuss efforts to reduce costs and then in your answer, maybe you could talk about how much that might contribute to margin improvement. Any objective eventually, getting to 9% margins.

This is Chris, I won't discuss the contribution to the margin rate. And when we expect to get to 9%, we'll talk a lot more about that on the year-end call. But the capital investments we've made in technology investments we've made both Ingalls and Newport News are going very well. And the simplest form at Ingalls getting all the work on undercover really drives efficiency if you've ever been in Mississippi in August and then the digital shipbuilding products are becoming more mature and help on the manufacturing and CVN 80 and the Columbia class. so, we're very encouraged by the technology investments in the capital investments we've made and we hope to continue to drive costs out of our products.

Okay. Thank you.

Our next question comes from Pete Skibitski with Alembic Global. You may go ahead.

Good morning, guys.

Go ahead.

Just a follow-on to Seth's question on the Kennedy. Chris, I think you say you're going to get the contract defeminization that's going to maybe move the risk registers to the right a little bit. I just want to make sure I'm in line with. I think I've been assuming that the Kennedy retirement opportunities, those retirement opportunities who will be 2022 2023. Is that still the case or are they shifted to the right at 24 or 25. I just want to level set that.

No, no. 23 and 24 make a lot of sense. We're really in volume when it comes to 79 right now getting through compartments and work packages, starting localized testing. But it's 23, 24-time frame.

I appreciate that and maybe one for you, Mike. I always like to ask any hope left on with NFC 12, it seems like all the committees have reported I wasn't sure if anyone stuck in any language or funding at all with regard to that?

Well, I think, you're reading that right. We are -- we have a great product line there and we're very excited about what we've done. But right now, there's just this -- in the contest for resources it's not fairing very well. So, we'll probably just leave it at that.

Yeah. Those always seems to come up short and I know, too bad. All right, thanks, guys.

Next question comes from David Strauss with Barclays. You may now go ahead.

Thanks. Good morning. I wanted to ask about Alion. I think when you announced the deal, you talked about $1.6 billion in annualized revenue. Based when you do in the quarter and when you're applying for the year and it would seem like either it's running well below that or you're expecting big growth in ' 22. Can you just comment on that?

Sure. Yeah. Good morning. So, for the court, I think in my remarks, you'll see a $163 million Q3 from the line perspective. You kind of run that out for another quarter as Q4, that's the run rate. A little over $300 million there. so collectively it's about $450 million. On an annualized basis, that's like $1.4 and change. And then you get to the 1/6 growth rate of a little bit higher than 11.5%, 12%, so that's the math of it right now. We still stand by the guidance that we. And revenue and the 135 adjusted EBITDA.

David, this is Chris. I'd also add that the integration of the front end of that business has gone very well in business development and capture. We have a $60 billion total pipeline that we're working through and prioritizing a number of significant competitions over the next . and a book-to-bill at 1.8 in the quarter. So, all indications are positive for that business.

Okay. Thanks for that. As a follow-up, I want to ask about the, Tom, the long-term free cash flow profile. Obviously, you're sticking with the 3.2. I think previously you had said that '22, '23, '24, that time frame would be fairly -- free cash flow over that period will be fairly ratable across those years. Is that still the view or is there -- is it going to ramp during that period? Thanks.

Yeah. So, as you said, the Q2 is still good. We have 757 behind us. I've given you the outlook for this year, so it's about 1-1 and that leads to what last over the last three years. So strict to pick map would be about $700 million. We do have a next year, as I mentioned, we have to pay back the fica payments, so that's $66 million. We have progress payments that have to be paid back, that's $100 -- around $160, so you can do some math on that, but there is a ramp to it. So, between those 2 payments and just a slight ramp, I mean, you can just model those 3 years out, but we still feel comfortable and it's appropriate to guide to $3.2 billion over these 5 years.

All right, perfect. Thank you.

Again, Our next question comes from Noah Poponak with Goldman Sachs. You may go ahead.

Good morning, everyone.

Good morning.

Tom. With these outsides of the normal course of business items, supply-chain, with just their material labor. And then also combining that with the, with how the growth compares shakeout. Should we be seeing thinking of next year? the shipbuilding growth rate being fairly back-end loaded versus the first-half? And then just following up on that Alion discussion there, are you seeing -- we've seen those headwinds across hardware and outside of hardware. Are you seeing some of those same challenges outside of the business in Alion or not as much?

Sure. For the first part, from a shipbuilding perspective, I highlighted a little bit earlier, I didn't hit the backlog piece of the outlook, right? So, unlike say, requiring needed new awards or funding, we have a line of sight of the work that we have in-house. So, I look at, from an outlook perspective, from shipbuilding. Still the 3% CAGR is good. I would tell you that although it looks like we're at the same point we were through the first 3 quarters of this year compared to last year, last year was an exceptional year, '18 to '19 with the 6% growth and then '19 to '20 with another 6% growth. And even specifically Q4 last year was a 19% growth over the quarter previously there. So, some material as I highlighted -- as actually Chris has moved into the end of Q4 of 2020, it made that year look big, which now makes 2021 look flat. So, I'm not concerned right now because we have the backlog, we have the work, we have the labor force right now. We are watching materials as I said and we're watching if the EO mandate impacts our workforce, but I don't -- I'm not concerned with how 2021 was shaking out from a revenue perspective. And I would think going forward that it's pretty linearly in 2022 for ship building. Relative to your lying question, I don't see obviously, their contracts are different, more service oriented. We're excited with them on board. Andy has put his leadership team in play, as Chris had mentioned earlier, the initial assessments that we had going into the purchase and now the close we've had a good 6 weeks run rate in the financials and look under the hood there. We're comfortable with what's in front of them. The items that they're bidding, and how they're executing on the existing contracts for evaluating the revenue synergies between Alion making us better, the DFS and MDIF and vice versa. So, I feel comfortable with that going forward there. I don't see today, again, the EL mandate significantly impacting our revenue expectations from an Alion perspective. We have highlighted from a perspective. When you get to watch the funding come about and the unmanned portfolio evolve and grow going forward. Special watch on for us.

Okay. Thank you.

I'm not showing any further questions at this time. I would now like to hand the call back over to Mr. Petters with any closing remarks?

Well, thank you. And I want to thank everyone for joining us on today's call. Before I close, I wanted to pass on to you that Dwayne Blake has informed me that he wishes to retire.

Deny that request, Mike.

Yeah. I've already turn it down a couple of times. But Dwayne and his family, they've been parts of our family here for 37 years. His personal support for all of us here at Huntington, it -- throughout his career, but especially in his last position here had just been extraordinary. So, when you call today to harass Dwayne about the filing or the call, just remember, he's a short timer now and so he might have some leverage in that call. With that, we wish Dwayne and his family well, and we wish them all the best as they move forward with the next chapter of their lives. And with that, we appreciate your interest in HII and we welcome your continued engagement and your feedback. Thank you very much.

The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.