00:05 Good morning, and welcome to the Host Hotels & Resorts Fourth Quarter 2021 Earnings Conference Call. Today's conference is being recorded. 00:14 At this time, I would like to turn the call over to Jaime Marcus, Senior Vice President of Investor Relations.

00:22 Thank you, and good morning everyone. Before we begin, please note that many of the comments made today are considered to be forward-looking statements under Federal Securities Law. As described in our filings with the SEC, these statements are subject to numerous risks and uncertainties that could cause future results to differ from those expressed, and we are not obligated to publicly update or revise these forward-looking statements. 00:49 In addition, on today's call we will discuss certain non-GAAP financial information, such as FFO, adjusted EBITDAre and hotel-level results. You can find this information together with reconciliations to the most directly comparable GAAP information in yesterday's earnings press release, in our 8-K filed with the SEC, and in the supplemental financial information on our website at hosthotels.com. 01:19 With me on today's call will be Jim Risoleo, President and Chief Executive Officer; and Sourav Ghosh, Executive Vice President and Chief Financial Officer. 01:29 With that, I would like to turn the call over to Jim.

01:34 Thank you, Jaime and thanks to everyone for joining us this morning. Despite the uncertainty of COVID-19 variant, we significantly outperformed expectations during the fourth quarter and substantially beat consensus metrics for the year. We delivered adjusted EBITDAre of $242 million, which exceeded our interest in capital expenditures by $68 million and achieved adjusted FFO per share of $0.29 during the quarter. 02:06 In addition to delivering positive metrics each quarter, we achieved meaningful sequential increases each quarter throughout 2021. Pro forma total revenues in the fourth quarter grew 20% compared to the third quarter, while pro forma hotel-level operating expenses increased only 15%. RevPAR for the fourth quarter was $148, as volume and rates continued to hold up at our hotels in Sunbelt markets. This is the highest quarterly RevPAR we have seen since the onset of the pandemic, and closes out a year of strong sequential improvements. 02:48 RevPAR improved 13%, compared to the third quarter, despite some softening of demand in late December due to the Omicron variant. Our recent acquisitions, which I will touch on shortly, all contributed to our outperformance during the fourth quarter and are exceeding our underwriting expectations. Preliminary January RevPAR is expected to be approximately $105, a 130% increase over January 2021. Our preliminary February RevPAR forecast is expected to be $150 to $155 and we expect a significant pickup across business segments in March, which is consistent with the recovery we experienced following the Delta variant. 03:38 In addition to delivering significant operational improvements, we continue to be recognized as a global leader in corporate responsibility. Our 2025 emissions target is verified by the Science Based Targets Initiative at the 1.5 degree Celsius ambition level, making Host the first hospitality company and among the first three real estate companies in…

19:16 Thank you, Jim and good morning everyone. Following Jim's comments, I will go into detail on our fourth quarter top-line performance, margins, our thoughts for 2022 and provide an update on our balance sheet and dividend. Despite headwinds from two COVID variants, we continued to benefit from quarterly sequential improvements with 70 hotels achieving positive hotel EBITDA for the entire quarter, compared to 61 hotels last quarter. Notably, our three New York City hotels, two downtown Boston Hotels, and the San Francisco Marriott Marquis, all achieved positive EBITDA in the fourth quarter. 19:57 Moving on to top-line performance. Fourth quarter RevPAR was the highest it has been since the onset of the pandemic. In addition, December had its highest monthly ADR in Host history, which is indicative of the quality of our assets and the pricing power of this recovery. While these improvements have been driven by leisure, travel in Sunbelt markets and Hawaii, which saw fourth quarter RevPAR up 16% to $198 over the third quarter, our urban markets continued to deliver sequential operational improvements. During the fourth quarter, our urban markets grew by 13% to a RevPAR of $108, once again representing the best quarter of the recovery for these hotels. 20:46 Turning to business segments. During the fourth quarter, transient revenue improved 7% over the third quarter, driven by a 9% rate increase. Transient revenue at Sunbelt and Hawaii hotels was up 8% sequentially, driven by a 12% improvement in rate and once again exceeded prior peak levels. Drilling down to resorts, our properties grew transient revenue 30% over the fourth quarter of 2019, driven by a 35% increase in rate. 21:20 Compared to the fourth quarter of 2019, Alila Ventana Big Sur, one of our recent acquisitions, grew revenue by over 130%, which was driven…

31:22 Ladies and gentlemen, the floor is now open for questions. [Operator Instructions] Your first question for today is coming from Smedes Rose. Please announce your affiliation and pose your question.

31:54 Hi, it's Smedes with Citi. I was just wondering, Jim and Sourav, if you could just talk a little bit about the staffing levels you have achieved in your hotels. It sounds like demand is coming back faster than expected, and kind of where are you on being able to re-staff and maybe throw out your thoughts on just kind of what the pace of kind of wage and benefit increases should be over the course of '22?

32:19 Sure, Smedes, I'll take the first part of it, Sourav can take the second part of it. We added about 1,000 positions in the fourth quarter. And as you may recall, on the Q3 call we stated that the staffing levels were 94% of our managers is our goal. Typically, they run to about 97%, they never get to parity, they're never at 100%. With the increase in business volume in the fourth quarter, even though we added a 1,000 positions, we still remain at about 94%. But I can tell you based on conversations we have had with our managers, there is a degree of confidence that the open positions are going to be able to be filled as things open up, as the variant gets behind us, as children get back to school in person across the country, and as the various forms of stimulus burn off, which many of them already have. 33:29 So with that, I'll let Sourav talk about our point of view around wage -- wage increases and inflation.

33:38 Hey, Smedes. For 2022, we were expecting year-over-year increase wage rates of somewhere around 4% to 4.5%. And this is in line with sort of what we had spoken about in terms of the 19 to 22 CAGR you might recall, which we said would be somewhere around 5% to 7% in aggregate for our portfolio.

34:01 Okay, thank you.

34:06 Your next question is coming from Bill Crow. Please announce your affiliation, then pose your question.

34:13 Hey, good morning guys. Raymond James. I do have a follow-up for you, Jim, but let me start with Sourav. In just thinking about the transition from '21 to '22 on a couple of line items, if you could just quantify the total support that you got from Marriott, whether it's the transformational capital program or other performance guarantees in 2021? And what your expectations are for that in 2022? And I think Jim you mentioned $11 million on the transformational side. 34:47 And then the second part of that Sourav is the -- I think you have talked about $40 million of cancellation and attrition fees in the second half of 2021. How much of a drag is that on margins as you try and replace that with actual business?

35:08 Sure. So, to answer the first part of your question, yes, for 2022 the amount that we are getting from Marriott in terms of the operational profit guarantee, that is $11 million. That compares to about $14 million that we got for -- in 2021. As it relates to the attrition and cancellation revenue, to put into perspective, we did approximately $20 million of attrition and cancellations revenue. We collected that in the fourth quarter. And when we compare that to 2019, it's only $5 million above that. Actually, when you look at the full-year in terms of attrition and cancellations revenue, it is very similar to what we collected in '19, which is about sort of $55 million or so. 36:02 What's different is the way we got there. The mix of the attrition, cancellation revenue that we collected is different. As business starts coming back, we expect obviously the group cancellation revenues to reduce. However, there should be a pickup in transient cancellation revenue. So, from an overall cancellation revenue mix perspective, that we expect to change as we normalize throughout this year, but when you look at sort of just comparing '19 to '21, total cancellation revenues, they are actually pretty similar in terms of total that was collected.

36:37 All right, that is helpful. And Jim, I said I was going to have a follow-up. I am going to play devil's advocate for a second. You suggested that the Noble investment was an efficient way to gain diversification across more chain scale. So I think it was -- I am paraphrasing obviously, but is that something that investors have asked for from Host, because you have done a really good job of just kind of concentrating on these wonderful top 40 or maybe it is top 50 assets now. And I am just wondering what drove you to think about that diversification?

37:13 Sure, Bill. I’m happy to answer the question. It is not something we have heard of -- heard from investors quite frankly. But as we think from a strategy perspective, and playing the long game here, how can we transform the income stream of the company to make it more sustainable going forward. And one of the things that has always been of interest to us is the fund management business. So we talked a lot about strategy among the senior team and with our Board, about really three things that Noble checks the box for us on. Fund management, how do we play in select service without it becoming a distraction and without it really, if you will, muddying up our story. And we have a lot of expertise on the development side as well. We have a really solid design and construction group, I think they are best in class, far and away with some of the projects that you have seen in some of the projects that we have completed. 38:30 So as we sat back and thought about those three objectives, the best way to accomplish that is through an off-balance sheet vehicle, and Noble we think is also best in class. So investing in the Noble platform gives us the ability over time to grow a sustainable fee stream that is not subject to the cyclicality of the lodging industry. It is commitment fees, it is asset management fees, it is development fees. 39:04 It gives us an opportunity to further deploy capital into the select service space without, again, it becoming a distraction for the management team at Host. Mit Shah and his team have been in business since 1993. They have invested over $5 billion and they have a very strong track record. 39:28 So again, select serve, the way they have done it is a very attractive investment from our perspective and we've made $150 million commitment to his next fund. And lastly, having the ability to participate in development projects in an off-balance sheet structure is also something that is very attractive to us. That is not something we ever wanted to do on our balance sheet, it is not conducive to the REIT model. So it is just another opportunity to elevate the EBITDA growth profile of the company in a way that it is not going to be a distraction, but is going to bring two very, very successful best-in-class organizations together.

40:19 Great. I appreciate the answers.

40:24 Your next question is coming from Floris Van Dijkum. Please announce your affiliation, then pose your question.

Hi, it is Floris at Compass Point. A question, Jim, and maybe if you can touch on this, and I guess I'll -- it is more regarding to the valuation of hotels. And I saw, number one, you have sold 3 ground leases, you have got some more ground leases. I don't think you are going to sell any of the San Diego ground-leased hotels, but maybe if you can -- which other hotels might be on the block? And also talk about -- maybe if you can touch on, I noticed the 1 Hotel had $68 million of hotel EBITDA this past year. How does that compare to pre-COVID levels? And how sustainable -- the one fear that we hear from some investors is, well, gee, these resort hotels are -- have really strong EBITDA today, but could that fall off? How sustainable is the EBITDA from your top resort hotels and maybe talk about -- a little about the growth prospects for those assets?

41:39 Floris, there is an awful lot in that one question, so let me see if I can take it apart for you a little bit. I will start with the -- your question regarding what other hotels might be on the block and how are we thinking about ground leases. We sold three ground lease hotels, probably not -- we are not going to sell the Manchester Grand Hyatt or the San Diego Marina Marriott. I will just say that, any time we think about an acquisition or a disposition, overshadowing that conversation is, will it elevate the EBITDA growth profile of the portfolio? And that really is our baseline as we sit down and look at, okay, is this asset going to grow below, at average, or above the rest of the portfolio at Host. 42:36 So that is the gating issue for us. And there are some -- not all ground leases are created equal. The ground leases associated with the San Diego properties or with the Port of San Diego, they have I think a 65-year maximum term, but every time you invest capital in your assets, you are able to extend the ground lease up to that 65-year term limit. So, not so with others that are in private hands. And if it makes sense for us to dispose of assets that have ground leases, that we will certainly do that and replace those -- recycle that capital either into additional acquisitions or into additional ROI projects as we are undertaking this year and as we have been undertaking. Again, just to elevate the EBITDA growth profile of the company. 43:37 With respect to the 1 Hotel in particular, I actually went through the supplemental myself yesterday and when I saw that $68 million number,…

45:27 Thanks, Jim.

45:32 Your next question is coming from Neil Malkin. Please announce your affiliation then pose your question.

45:39 Hey, everyone. It's Neil Malkin, Capital One Securities. I was hoping you could talk about the kind of operating model that was one of the things that you said are -- is one of the three facets that you are working on to improve the company and grow EBITDA, et cetera. I believe, yesterday Hilton talked about I think 400 basis points and 600 basis points in terms of the model or the margins. I was just hoping maybe you could give some insight as we begin a little bit further past COVID and you have kind of hammered out more of the brand-standard enhancements. Does that 100 to 150 number or whatever that equates to in basis points, does that seem low now? And do you think given the things you have seen with staffing and efficiencies and ADRs and things like that, that may wind up being low and that sort of the previously disseminated margin improvements are going to wind up being light of what is actually going to happen?

46:53 Hey, Neil, it is Sourav. So, I think the way to think about it in terms of the margin expansion, it really will be driven by how quickly we get back to 2019 levels of revenue, right? So the $100 million to $150 million, we are still very, very confident we can deliver that in incremental EBITDA based on 2019 numbers. But all depends on when we get back to the revenue. And frankly, if we get back via rate first, which it looks like we will, obviously you benefit more on the margin front as a result of that. So yes, there is definitely possibility that you end up getting more of a margin expansion as a result of coming back to '19 levels via rate. 47:33 As it relates to where we stand on our initiatives, we talked about it in sort of three big buckets. One is the reduction of management staffing at all our hotels, and it was very hotel specific. We went through every single hotel on sort of zero-based budget and figured out what the ideal staffing level is on -- at a normalized level. And I am happy to report that we had said about 25% to 30% of management staffing would be reduced permanently and that it has been the case, and that is baked into our 2022 budgets. 48:05 The second big bucket was reduction in Above Property charges, which if you listened to the Marriott call, that has also resulted in savings and can -- will continue to result in savings. That is also baked in. The last bucket was sort of twofold. One, as you said, is the modification or elimination of certain brand standards, and then also leveraging technology to drive improved productivity. I will say, of the $100 million to $150 million, 60% we have already initiated, and we are well underway to initiate the balance 40%, which is really the third bucket of brand standards and technology implementation. 48:46 On the brand standards piece, there are a lot of changes that have already taken place, whether that is removal of compendiums or it is making the long stocks optional or relaxation of robes and slipper standards at the premium brands, and including flexibility of operating hours for the club lounge. Minimum hours that are not only for the club lounge but also premium restaurant, as well as relaxation of whether you need premium restaurants at non-resort hotels. So we have made significant progress on the brand standard front. I think the piece which we are still testing right now is housekeeping, and we will have an answer on that sometime middle of this year, but certainly not going back to where we were in 2019. It is really about providing more optionality and flexibility to the guest, but still making sure there is that guest satisfaction level that is needed for the respective brands. So hopefully that gives you some color.

49:47 Yeah. Appreciate that. Thank you.

49:53 Your next question is coming from Jay Kornreich. Please announce your affiliation then pose your question.

50:01 Hey, it is Jay Kornreich with SMBC Nikko. Great to be on the call. With the return of office inflection point likely now underway, which we expect to lead to a strong recovery in BT demand, and you indicated seeing settlement in February, do you consider getting I guess more aggressive in shifting your acquisition pipeline to focus more on dense urban markets to get ahead of that instead of the resort and Sunbelt strategy over the past year?

So, Jay, your question is, are we going to move to where the puck's going or where the puck has already been. Right? In the words of Wayne

50:43 Correct.

50:46 As we think about acquisition opportunities, I will say a couple of things. We don't have a red line through any market in the United States today. And nor do we have a red line to any property type. However, we have not seen a lot of opportunities in the major urban markets to date. And we did have a keen focus last year on Sunbelt and resort markets. Even if we were to deploy capital into the major urban markets, assuming we could find the right asset at the right pricing and it worked for us, I think the demographics of the nation are such that we will continue to deploy capital in Sunbelt markets for a lot of reasons. Just the inflows of business, the inflows of people, the favorable operating environment, the low cost structure, it makes those markets attractive to us. 51:55 In resorts today, we own 16 resorts. If the -- if you look at supply statistics, the lowest level of new supply in the nation is in the resort market. And the second-lowest level of new supply is in the big box hotels, many of which we own. So we are very comfortable in both of those areas. And as opportunities become available, we will certainly evaluate them. There just hasn't been anything in the market that has been of interest to-date.

52:33 Okay. I appreciate the color. Thanks so much.

52:39 Your next question for today is coming from Stephen Grambling. Please announce your affiliation, then pose your question.

52:46 Hi, it's Stephen with Goldman Sachs. Maybe a follow-up on the urban market question, are you seeing any change in the supply backdrop in these markets given how long some of these assets have effectively stated in a negative EBITDA? And would that potentially be a catalyst for you may be shifting back into those markets -- shifting back but maybe refocusing there?

53:12 Yes, Stephen, I -- supply has taken a material hit in a lot of the markets around the country. I think that CBRE and SGR are projecting supply growth at just over 1% through at least 2023. The total pipeline is down something like 8% of pre-pandemic levels, and there are a lot of projects out there but they are just languishing right now. The most comforting statistic around supply is the in-construction pipeline is now about 25% to pre-pandemic levels. So the supply situation is -- we can't paint a broad brush with it. The lowest supply markets are Hawaii, San Diego, San Francisco, and Seattle. 54:07 Unfortunately, there is still a lot of supply coming online in New York. And I think we are going to see that happen over the course of '22 and even '23 and there is a lot of supply coming online in Los Angeles. So there are some hotels that are not going to reopen in San Francisco and in New York, but it is nothing like the talk early in the pandemic about a massive shift of hotel inventory coming out of the market. So, again, market-specific, asset-specific, pricing-specific, but we will continue to explore opportunities again with the sole objective in mind being elevating the EBITDA growth profile of the company.

55:04 Helpful. Thanks. I will jump back in the queue.

55:10 Your next question is coming from Robin Farley. Please announce your affiliation then pose your question.

55:17 Thanks. Yes, it is Robin Farley with UBS. A lot of my questions have been answered. I guess, just maybe one more follow-up on the transaction environment. Just given you had a great track record of transactions last year, just with kind of a more recovered market out there, interest rates moving up, I guess it's -- how much opportunity -- how would you compare the environment generally in terms of opportunity for transactions compared to where it was in the second half of last year? 55:47 And if you can remind us if there is a certain dollar amount that you have to spend on acquisitions this year, like as a result of 1031 exchanges or anything like that we should keep in mind too? Thanks.

56:00 Yes, Robin, that the second part of your question regarding certain dollar amount, there is not. We have been able to like trying to exchange our sales proceeds really reverse like kind of exchange or so, sales proceeds into the acquisitions that we did last year. Most recently, the sale of the Sheraton Boston into the Hotel Van Zandt, so we are in a very good place with respect to no pressure to buy assets to protect the 1031 exchange issue. 56:39 I think what happened with the Omicron variant coming to light in December, typically, we would see a strong pipeline of assets at the ALIS Conference, which was held third week in January this year. I did not -- we as a company, that my team did not hear of a lot of acquisitions in the market today. We think people have pulled back as a result of Omicron and just wanted to wait and see what the impact was on hotel performance. And as we have said, $105 RevPAR in January, $150 to $155 RevPAR in February, a strong bounce back. So I would expect that we will see more properties come to market in the second half of the year. 57:37 But at this point in time, there just aren't that many assets out there we are interested in. And I might remind you that of the seven assets we bought last year, five of them we purchased off market. So we are going to continue to have conversations with owners of hotels that are of interest to us.

58:02 Okay. That’s great. Thanks very much.

58:08 Your next question is coming from Anthony Powell. Please announce your affiliation then pose your question.

58:14 Hi, it is Anthony Powell from Barclays. Just a question on the dividend which was a nice surprise. How did you get to the $0.03 quarterly number? You didn't have to pay dividend given your NOL, so I am curious, how should we expect the dividend to trend over the next several quarters? Do you look at percentage of FFO, cash flow? Just more detail would be super helpful.

58:35 Sure, Anthony. No magic number that we sense. It really is what we are comfortable paying based on the recovery trajectory that we are seeing. It will all depend frankly on how that operational recovery pans out. And obviously our goal is to grow that dividend and get it to a sustainable level. But $0.03 is what we are comfortable with for the first quarter, we will see how operations shape up and what happens in subsequent quarters. We will obviously be authorized by our Board of Directors.

59:10 So it could go up here even in the short-term if things continue to improve. Is that a fair assumption?

59:16 That is fair.

59:19 Okay. All right, great. Thank you. Great quarter.

59:21 Thanks.

59:24 Your next question for today is coming from Ari Klein. Please announce your affiliation, then pose your question.

59:31 Thanks. Ari Klein with BMO. Maybe on the CapEx front, the Marriott Transformation Program wraps up this year and some CapEx may be assets that have been sold, is the $400 million to $500 million ex-Marriott kind of the right way to think about CapEx beyond 2022? And what are some of the major ROI projects that are being contemplated beyond this year?

59:56 Sure. Let me start with a couple of the major ROI projects that are in that number. And I do want to emphasize that of the CapEx guidance we have given, $200 million is related to two major ROI projects that we believe will develop very -- deliver very attractive returns, double-digit cash on cash returns on the money we are putting into them. And the first is the Ritz-Carlton in Naples, it is a complete transformation of that asset. Every part of the resort, which is just a terrific hotel on the beach in Naples, Florida, is being touched. We are increasing the room count from 450 rooms to 474 rooms and we are combining 100 keys at that property, just to give you some color, to allow us to enhance the suite count from 35 suites to 92 suites. We are building a 74-key new tower and we are building a new club lounge that is frankly 6 times the size of the existing club. 61:15 Why is that important? For context, club rooms get an average annualized ADR premium in excess of $220, and we just didn't have the space at that property to sell the number of club rooms that the demand would warrant, so we are very excited about the things we are doing at Naples. Additionally, we are building a new swimming pool, a new pool bar, and completely redoing the lobby. This is anticipation in part -- a couple of things, that number one, focus groups' work that we did indicated that it was time to really update this property. It had been built in 1985, and really the bathrooms in particular needed to be updated and we went from 3-fixture bathrooms to either 4 or 5 fixture bathrooms throughout the entire…

64:26 Thanks for the color.

64:31 Your next question is coming from Chris Woronka. Please announce your affiliation then pose your question.

64:40 Hey, it is Chris from Deutsche Bank. Thanks for taking the question. Jim, as you guys think about the new cost structure that you have put in place and I understand still trying to hire some employees to fill it out, but we don't know exactly yet where all the brand standards are going to fall, right, on housekeeping and things like that by brand and price point. So the question is, is this going to be an evolving situation or do you think -- you think the brands get to a point where they say, this is the standard, we are going with it, and hire employees as needed? Just trying to get a sense for whether there is any kind of latent risk that we are going to end up with more labor than we thought we might need a year from now.

65:31 So, let me start the answer, Chris, and then I would like Sourav to jump in as well, because he has been having the conversations at the brand level. We started having conversations on brand standards pre-COVID. So it is not something that the initiative wasn't undertaken just as a result of the pandemic, but it was something that we had conversations with our major managers on -- in 2018 actually, and 2019. It is very clear now that there is no one brand standard, that it's all hotels. Both of our major managers have seen significant reductions in headcount at their headquarters, which really impacts Above Property cost and expenses. So I think we feel very confident that we are not going to see creep coming back in. 66:46 With that said, I will let Sourav jump in and maybe even talk about some of the more recent conversations we have had.

66:55 Yes, I would echo what Jim said, I don't think there is any risk in terms of the creep coming back, and we have confidence in that. And when you look at sort of our success in expanding margin pre-COVID, which was pretty meaningful, we really did separated ourselves from our peers on the margin front, it was because we didn't let cost creep come back. And this time around, like I was saying earlier, we have zero-based everything for every single hotel. It is the first time we have the opportunity, because a lot of hotels just spend on their operations, for management team to really take a step back, work very closely with our asset management and enterprise analytics teams to come up with what the ideal -- really operating model should be and staffing levels should be at once things get back to normalized levels. 67:46 So for anything that gets added back, there is an approval process it needs to go through, and unless there is truly an ROI associated with that position being added back, we certainly do not approve it. So we are pretty confident that if there is any position added back, there is going to be a return associated with it. Otherwise, it is not going to be added back.

68:09 Okay, very helpful. Thanks guys.

68:16 Your final question for today is coming from Rich Hightower. Please announce your affiliation then pose your question.

68:23 Hey, good morning, guys. Evercore ISI. Thanks for squeezing me in. I guess just to maybe play devil's advocate for one second here on the dividend, at least over the long-term. I mean, certainly in the short-term I totally understand a nominal dividend for sort of technical factors in terms of who can own the stock and so forth, but given that we are as early into the new cycle as we are, there is a lot of investment opportunities probably coming down the pike. You have got significant NOLs that will probably shield you from having to pay a significant dividend for several years. 69:00 So what is the thought about paying more than a penny than you have to pay once cash flows sort of stabilize? Why focus on the dividend? Do you think investors really care about it at the end of the day?

69:16 Hey, Rich. One thing I want to make sure is clear is, we did not have a significant amount of NOLs at the REIT level. Majority of our NOLs is at the TRS level. So therefore, the question doesn't arise of shielding sort of our taxable income with NOLs at the REIT level. The REIT-level NOLs that we did have, we effectively plan to use if there is any gain on sale, and to offset that. So it is -- I just want to make sure that is clear, so whenever taxable income is going to be generated, we will be paying that off -- paying that out as dividend. So I just want to make sure that is clear, Rich.

69:56 Yes, that is helpful. Yes, thanks for that. And then just more broadly then, just in terms of the opportunity landscape relative to the dividend, not that they have to be mutually exclusive by any means.

70:09 Yeah, Rich. I don't think they are mutually exclusive. If you look at the quantum of cash that goes out with the $0.03 dividend, it is $21 million order of magnitude. Annualize that times four, it is $80 million, so there is a subset of investors that aren't unable to -- we are not able to own our stock. And we have the balance sheet, we have confidence in the recovery and we want to give everyone an opportunity to participate in that recovery, which is one of the reasons why we reinstated the dividend at $0.03.

70:57 All right. Got it, guys. Thanks for the color.

71:04 That is all the time we had for questions today. I would now like to turn the floor back over to Jim for any closing comments.

71:12 Well, I would like to thank everyone for joining us on our fourth quarter call today, we appreciate the opportunity to discuss our quarterly results with you. I look forward to meeting with many of you at in-person conferences in the coming weeks and months. Be well and stay healthy, and thank you for your continued support.

71:36 Thank you, ladies and gentlemen. This does conclude today's event. You may disconnect at this time and have a wonderful day. Thank you for your participation.