Good day, and welcome to the Pool Corporation’s Third Quarter 2019 Conference Call. All participants will be in listen-only mode. [Operator Instructions] I would now like to turn the conference over to Mark Joslin, Senior Vice President and Chief Financial Officer. Please go ahead.

Okay, thank you. Good morning everyone and welcome to our third quarter 2019 earnings call. I would like to remind our listeners that our discussion, comments and responses to questions today may include forward-looking statements, including management's outlook for 2019 and future periods. Actual results may differ materially from those discussed today. Information regarding the factors and variables that could cause actual results to differ materially from projected results is discussed in our 10-K. In addition, we may make references to non-GAAP financial measures in our comments, a description and reconciliation of our non-GAAP financial measures is included in our press release and posted to our corporate website in our Investor Relations section. Now, turn the call over to our President and CEO, Peter Arvan. Pete?

Thank you, Mark, and good morning to everyone on the call. I am happy to report that Pool Corp delivered strong results in the third quarter with total revenue, up 11% to a record $899 million, while our base business, grew 9%. Revenue in the quarter was positively impacted by approximately 1% for the additional selling day in the third quarter of 2019 versus 2018. Base business sales for swimming pool products were up 10% for the quarter, while landscape and irrigation products were up 6%. Our major year around swimming pool markets performed well with 8% base business of sales growth, California, Florida and Arizona, each posted approximately 7% of sales gains, while Texas grew 9% for the quarter as it recovered from unfavorable weather conditions earlier in the year. Our seasonal pool markets also benefited from the nice weather and posted base business sales gains of 12%, showing the demand for pool and outdoor living products remained strong across our markets. Looking at couple of our end markets, retail and commercial, we also saw a robust recovery from slower growth earlier in the year. Sales in the retail segment rebounded from a late start to the season, posting a 9% gain during the quarter and bringing year-to-date sales growth to 4%, commercial sales were, up 17% for the quarter and 9% year-to-date, as we continue gaining traction in this important segment. Strong demand and favorable weather drove solid growth across product categories with chemicals, up 7% for the quarter, much stronger than we had seen earlier in the year and an encouraging trend, which brought year-to-date chemical sales, up 4%. Equipment sales increased by 13% for the quarter and 6% year-to-date and building material sales were also strong showing 10% revenue growth in the quarter and 9% growth…

Thank you, Pete. I'll start my commentary on the P&L, beginning with margins. As I stated on our second quarter call, we believe that our margin gains in the first half of the year was largely reversed in the second half of the year and leave us with relatively flat gross margin overall for the full-year. Q3 results were right in line with that guidance and we believe Q4 will be as well, meaning you should expect a more significant year-over-year margin decline in Q4 to get us level with 2018 gross margin for the year. This is primarily a result of the impact from the pull forward of inventory purchases from 2019 into the second half of 2018. Our total operating expense growth of 8% in the quarter was impacted by acquisitions and the addition of new locations, as well as the additional business day in the quarter, compared to Q3 last year. Our base business expense growth was 5% in the quarter and 4% year-to-date, including the impact of new locations, which added about 1% to our expense growth in both the quarter and year-to-date, as well as an additional billing day, which also added about 1% expense growth in the quarter. On the other hand, currency translation gains resulting from our non-U.S. operations offset year-to-date expense growth by about 1% with little impact on the quarter. Given our expected Q4 gross margin decline, compared to the large gains recorded in Q4 last year and the impact from seasonal market acquisitions, which will have operating losses in the off season, we expect a decline in operating income in Q4 right in-line with our expectations as discussed on our last call. As a reminder, our Q4 2018 operating income grew 50% over Q4 2017, so a very difficult comp…

We will now begin the question-and-answer session. [Operator Instructions] Our first question comes from Ryan Merkel with William Blair.

Hey, thanks. Good morning, nice quarter.

Good morning, Ryan.

So couple of questions; first, the 9% base business growth it's really impressive and thanks for all the sale detail. I'm curious, though, what do you estimate this was boosted by for the favorable weather that we had this quarter, but also maybe some catch-up from this lower 2Q?

Yes, good question, Ryan. I think the way we look at it, it's probably $8 million to $12 million bucks that would – it's a combination of catch-up and good weather that we saw in the quarter, compared to the off of first half really.

Got it. Okay, and then your sense of what sort of the blended blue market is growing this year. Is it still kind of in that 3% range?

Yes, I think that's a good number.

Okay, And then moving to gross margin, I think we all understand 4Q, but if I can look forward just a little bit just we have the models, right. Should we think about flat for 2020 with sort of a lower first half and then maybe a better second half, just based on how the comps work?

You got it, Ryan. That's just how we've modeled.

Okay. And just lastly, I noticed that debt-to-EBITDA, it's pretty low here, maybe the lowest in a few years. What sort of the plans for capital allocation?

Well, our capital allocation is really the same Ryan no changes there. So we invest everything that we need to in the business and that includes capital at 1% to 1.5% of revenue. We have a dividend program, which grows with earnings over time, so that will continue. And then we're really close to the middle of our range on debt. In terms of where we want to be, and then we use excess cash for our share repurchases, which we do opportunistically. And opportunistically means that can be a little chunky over times, so we don't do that on a same quarter-to-quarter basis. So we'll have our opportunities over time and when we do we'll make sure we execute on that. So no changes overall in terms of how we allocate our capital.

All right. Very good. Thank you.

Thanks, Ryan.

Thank you.

Our next question comes from David Manthey with Baird.

Yes. Hi, good morning guys.

Good morning.

First off, it looks like you hit your base business SG&A growth as a percentage of gross profit dollar growth target this quarter, but for the full year, it might be a little short. I'm not sure if that's due to the variability of sales or what that – what the reason for that would be? But as we roll the calendar forward to next year, are there factors that will change in 2020 versus, what you saw in 2019 that will get you more comfortably into that 60% targeted base business range?

Yes, just you said at the end there and I assume you're referring to the 60% gross profit growth and our expense growth. And it may end up a little bit short there. So we use that as a guide and really the result of that, that we're shooting for is that 20 basis points to 40 basis points of operating margin improvement. And we do expect to be in that range, now it won't necessarily be at the high end of that range, but we should be in the range. So in terms of next year, I don't see and well and part of the reason, that's a little bit lower perhaps is because of the first half of the year, our sales growth this year was a little bit less than we expected going into the year, although we've made up for some of that in the third quarter, but really for the year, down a little bit from our expectation, because of the start to the year. So next year, we always assume normal weather going into the year and doing that should give us the opportunity to get that operating expense leverage that we're looking for and keep us in our targeted operating margin range of 20 basis points, 40 basis points improvement.

Got it. And as we're looking at modeling the fourth quarter, I just went back and looked at your growth and profitability in the fourth quarter has been surprisingly strong for the past several years, and obviously with the volume gains you've seen overall that's helped you go from an operating loss to a profit situation. But when you look at the fourth quarter revenues we're talking probably averaging double-digits overall for the past seven or eight years. I'm just curious that outsized growth seemingly in the fourth quarter. Was there something going on there, mix factors, geographic factors? Or what do you think drove that outsized growth rate in the fourth quarter relative to the first through third. But for the past several years?

Yes, that's a good question, Dave and I think if you go back and look at it, it's a little bit variable in terms of some years we do great and some year we do good in the fourth quarter. A lot of this has to do with weather, so because it's a smaller quarter, whether it makes a pretty big difference, particularly in the seasonal markets. So when weather is favorable, the demand is there, and it allows our customers to catch-up on that demand or to fulfill more of that demand, which gives us the opportunity to grow better both in the fourth quarter and the first quarter. So it's very weather-dependent. And obviously it's early, but I know what the quarter is going to look like when it's all said and done from a weather standpoint. So we don't get too enthusiastic about the growth, and even so it's still a marginal quarter when you look at the full-year in terms of the seasonality even in a good weather year so.

Dave, I think last year it was about 18% of total revenue and I think this year it looks to be in a similar range. The good news is, is that backlogs with the builders are still very strong and they are working hard to catch-up. But as you know, having followed us for so long, the biggest factor that we face is how long that we able to work, specifically in the seasonal markets. There is a lot of work in the seasonal markets that they're trying to get done. So as we always say on this call, if it's – if you're walking around, New York, with a sweater on for Christmas shopping, it will be a really good fourth quarter, if we got boots and gloves, it will be a little bit shorter.

Okay. I just wondered, if there was something else because as you point out 18% of full-year sales right now, if I go back to 2011 or 2012, it was 15% and change, and it just seems like that's a – it's more of a structural change than just a string of weather conditions. But I think we give can discuss it further offline.

Yes, one other point there is that Horizon business has generally less seasonality in the fourth quarter. And so you go back right after the downturn where that business was a smaller percent, I can't remember, it's probably 7% of our business something like that. And now it's 9% plus, so that is maybe a little bit of a structural change, if you're thinking about that.

Okay, that's helpful. Yes, thank you very much guys.

Yes.

Our next question comes from Stephen Volkmann with Jefferies.

Hi. Good morning guys.

Good morning.

This is probably just a rounding question more than anything else, but just sort of based on your guide and kind of how it works with the tax and so forth. It looks like the base business guidance was a little bit lower in the fourth quarter than what we had been looking for obviously third quarter is little bit higher. It's probably just timing and rounding, but I just want to make sure that there is nothing you're seeing that you're particularly, kind of, focused on in terms of something that may be slowing or some trend that, that might account for somewhat lower fourth quarter it look?

Yes, not at all. We kind of look at it is really no change in terms of our expectations when we go back to our second quarter and call then, and what we're looking at for the rest of the year, things are playing out as expected. So I guess it's what you said rounding and that kind of thing. So there's nothing structurally changing.

That's kind of what I thought. Thank you. And then just back to capital allocation a little bit, I mean, I know you'd like to be picky around share repurchases. But of course, none of us is particularly able to forecast too well, I mean, this may or may not be a good time. I'm just curious how you think about – how much cash or sort of how much debt paydown would you do? How low would you let the debt levels go before you sort of come back to that, if the stock keeps working?

Yes, it's a good question, Steve, I don't know that I can give you a specific answer there. But just kind of reiterate the point I made earlier, we're opportunistic in our repurchase, we've got a election coming up next year, which who knows what impact that could have on the market. We've been in a long full run here. So we'd certainly want to make sure we have cash available, if there is a market correction that takes place, and we'll be ready to participate in repurchases. So, we'll just see how things play out over the next several quarters and we will get our share repurchases and although opportunistically.

Understood. Thank you. And then just one quick follow-up, and this is maybe more, kind of, theoretical, but I'm curious how you are looking at kind of the new build market, I know it's not a huge part of your business. But it feels like a lot of the strength that we're seeing in housing is kind of at the low-end and in multi-family, and I don't know that those are necessarily as natural Pool customers as maybe the high-end and maybe disagree with that. But I'm just curious kind of how you see the new builds kind of, going into 2020 and whether that mix is something that we should be thinking about?

Yes. Good question, I guess the way I think about it is new builds prior to the downturn, were a much bigger portion of our business. Today it's call it in the 15% to 18% range of what we do in a year. And then the overlay on top of that the underlying capacity constrained in that there is more demand for the pools that will be built just based on labor capacity. So overall, even if you're correct with the housing shift and I'm not sure that I agree when you look at it geographically, specifically in the markets where new construction is very strong, Florida and Texas, which are very, very good pool markets. I don't really think it's a big factor for us. Just simply it goes back to the underlying demand being more than what the labor is. The biggest factor we had this year to contend with as you all know is weather but as I have said before, I view it as the system is pretty pressurized in that there is more demand than there is capacity to build them.

Okay, great. Thank you.

Sure.

Our next question comes from Blake Hirschman with Stephens Inc. Blake perhaps your line is muted.

Yes, I was muted. Sorry about that. Good morning, guys.

Good morning.

Good morning, Blake.

On the top line, I believe you were kind of thinking something like 6% to 7% top line growth for this year and your typical kind of 6% to 8% going into next year. I don't think they've been explicitly touched upon yet, if they have, I apologize. But are both of those kind of still the expectation as you sit here now?

Yes, that is correct.

Got it. And then on gross margins in the 4Q, I mean, should we be thinking about 4Q gross margins given up the entirety of that 100 basis point expansion that you saw last year? Or just that year-over-year decline is going to be greater than what we saw this quarter, just kind of trying to frame that up a little bit more?

Yes, just to kind of reiterate what I said earlier, we're looking for gross margins to be flat overall this year with last year. And if you model that in, that gives you that more significant margin decline in the fourth quarter, compared to the third quarter and basically giving us the gains that we saw last year in the fourth quarter.

Got it. Okay. That makes sense. And then lastly, just on M&A, kind of curious to hear where you are most focused now. I mean, it sounded like from the Investor Day that you're pretty interested in additional green business M&A. Just wanted to ask about commercial, international and just if you could kind of rank those areas in terms of M&A priority for you guys now? That would be great.

Sure. So the way I think about M&A, as we said during Investor Day that's certainly part of our growth strategy. If I look at it at on the green business and you look at our math. So from a coverage perspective, we have very good coverage Pacific Northwest through California, we have good density in Texas, but one of the areas that is of interest to us, where we have the weakest presence would be in the Southeast. So that's an area that specifically on the green side, it doesn't really make sense that we could achieve our goals by doing simply greenfields on the green business, so that would be – that would certainly be a priority for us. On the commercial side, there we've done some great acquisitions in the past that had given us a nice platform that we've been able to leverage across the entire platform. When I think about what's in our M&A deck for commercial, we are interested, there is nothing that I'm – that we're looking at now saying, well, this is a must have, there are really no large, very large players that we would do, so it would be more regionally and opportunistic, that we would participate in the commercial area. And then on the international side, what I would say is in Europe the market is primarily – France being the largest, Spain and Germany. We have a very good presence in France. I think we have opportunity to grow in all of those three countries, but specifically if I look at Spain, and I look at Germany and I look at the density, I would tell you that same opportunity exists for us that we should be looking in those areas as well, but they are relatively small as a percentage of our total when you look at our overall pool. But certainly to grow Europe acquisitions are going to be part of it, but we're not looking to significantly shift the mix of business by making very large acquisitions in Europe, if that makes.

Got it. Makes perfect sense. Thanks a lot guys.

Sure.

Our next question comes from Anthony Lebiedzinski with Sidoti & Company.

Good morning and thank you for taking the questions. So I guess, first, I just wanted to get a better sense when you look at your base business sales overall, kind of breakdown. Just give us some color if you can, just in terms of unit volume versus pricing, how was that and kind of your expectation – I know you said inflation, you expect to be more modest next year, but I know there are some new equipment coming into play where some new regulations were, as far as variable speed pumps come into play. So how should we think about that dynamic?

Sure. So when we look at unit volumes, I would tell you, let's go back to your original question about inflation. So inflation, let's say it's in the 2% range. So the base business unit volume is good, demand is good. So we are encouraged by what we're seeing, it's not like our growth is being driven by overall inflation unit volume is up. And then we talked about the variable speed pump legislation that's coming, which will take effect in 2021 that will be a – that'll be a nice opportunity for us. Because the price difference between a single speed pump and variable speed pump is about 2x. We also made mention of, if you look at pools that are being done today versus pools that were done five or even 10 years ago, there is a lot more bling and automation is becoming a more standard part of the pool package. So we're seeing a lot more of those were in the past, there wasn't a lot of automation, so we're seeing things like automation. We're seeing UV lights, so I think the – those things will help drive the overall base business growth as they are trying to make pools more user-friendly for the homeowner.

Yes. And just to clarify one thing they’re on the timing of that variable speed legislation, it's time to go and place in the mid-year 2021. So we just really don't see any impact on 2020, it's really a 2021 event. And really late 2021 most likely and into 2022 so I mean, there has been a slow shift over time from single speed to variable speed, but it's nothing like what will happen in mid-2021. And then as you think through that, it's a function of what the manufacturers decide to do with when they cut over from single speed to variable speed.

Are there any other regulations out there that could potentially help you guys in the future or is that the only one?

I think that's the only major one that will help, I think there is a – take California, for instance, the California is – has an electrification trend. So we – things like heat on the West Coast, which traditionally have been gas heaters, I think you're going to see more opportunity and we'll see more opportunity for heat pumps and electric, which is just again will be a slow trend, but nothing seismic. I mean, the one that is legislated is the variable speed that's the only one I know that will has a hard start to it.

Got it, okay. And just switching gears, so I just wanted to – just to clarify, so as far as 4Q you guys are not expecting any meaningful impact from ASU 2016-09 for 4Q?

No, we're not forecasting that as I said, we have $3 million in unexpired benefits that would have to be recognized between the fourth quarter and first quarter. We don't know when or how much of that $3 million, so we're including any of that in our forecast.

Got it, okay. And lastly, what is your expectation now for pool construction overall for the industry in 2019 and perhaps any early read for 2020?

Yes, still hard to tell, I don't know that I can give you a really good number. I think overall, so last year was about 80,000 units. Again, I think it will probably be flat, maybe down slightly, really depending on what happens with weather in the fourth quarter in the seasonal market. And again, it's a function of everybody got behind, demand is there, backlogs are good, but it really – and in order for me to tell you exactly what it would be, I'd have to tell you – will be able to forecast the weather for the fourth quarter. So normal fourth quarter, I would tell you that they are working very hard to catch-up, which probably makes the number flattish. Next year, we would expect to see some just mild growth, I guess, it's maybe in the 5,000 pool range, so maybe 80,000 to 85,000 pools next year.

All right. Okay, thank you very much and best of luck.

Thank you.

Thanks, Anthony.

Our next question comes from Garik Shmois with Longbow Research.

Hi, thanks. A couple of follow up questions for me. Just first off, the seasonal market growth in the quarter, the 12% and my assumption is that a lot of that is just really favorable weather and some catch-up. Is that right or was there any maybe mix or geographic items that we should pay attention to?

The weather was very good in the third quarter in the seasonal markets, everybody had great weather conditions to work in.

Okay. And then just around the fourth quarter guide, is the mean variable from the low to the high-end really just, again – not to harp on weather, but really just the volatility and the lack of visibility around the weather. Is there anything else that we should pay attention to?

No. As I said, what's encouraging is demand is good and builder backlogs are good, because everybody got behind in the beginning of the year. So I think there, they have a lot of work to get done and they're working very hard to get to it.

Okay. And just lastly, just on the commercial, just because the growth is 17% in the quarter, I think it's 9% year-to-date. How much do you think you're outperforming the market right now and how much more legs do you have to kind of this outperformance on the commercial side moving forward?

I guess, I would say that I think we're probably about 2x, last year I think we were up about 11% for the year, this year after a very strong quarter, we're up 9%, but I would tell you, I think we're about 2x and I think we are – our teams are getting very good at it and we're gaining traction on it every month.

Okay. Thank you.

Our next question comes from Ken Zener with KeyBanc.

Good morning, everybody.

Good morning.

Good morning, Ken.

So thinking about your tax rate, just as we look into next year, I think you'd mentioned 25.5% in the past, I mean, should we be using that for next years?

That is a good estimate and you have a good recall. Yes, 25.5% is right in line with my expectations, Ken.

Okay. Mark, you're not really all that enthusiastic about the fourth quarter or the election year prospects for volatility I guess, found that interesting, that's more of an aside. What are the seasonal markets as a percent of total sales, generally speaking, and I apologize if you told this at the Analyst Day?

Well, the top four markets are a little better than 50%, now that's not all of the year-round markets, so that maybe 60% is year-round and 40% is seasonal, when you look at our prices.

Okay. Good. Now I appreciate how you laid out the categories. Chemical is 7%, 4% year-to-date, et cetera. If we can just hone it on how chemical, up 7%, equipment up 13%, compares to what might drive the chemical versus the equipment. I mean, is it similar volume and it's really equipment price that is driving the upside there, I guess this is my first question?

No, I would say, if you look at equipment pricing certainly doesn't account for the difference. I think on a year-to-date basis with chemical, remember the amount of chemicals that you use in your pool is a function of how often you are using your pool and how much sun that you have is burning chlorine. So given the slow start that we had to the year and the fact that pools open late and didn't get a lot of use, because it was unseasonably cool in many of our traditionally strong markets, I think that's what kind of tamped down the chemical. If you look at equipment on the other side, that's a function of a strong remodel and renovation market. And if you look at the third quarter specifically, it's – there is a bit of catch-up in there too.

Right. So, okay, it is – well, could you perhaps, this variable speed pump 2021 realizing it's not an FY2020 event, you probably start loading inventory in at the end of next year, I assume. Could you maybe and I know this is just as – it buttresses your growth rates, but could you quantify perhaps, how you think about the market penetration of variable speed and is that – refresh, is that a federal regulation state, I mean state adopted or kind of quantify what that would mean in terms of the number of pumps that are not variable speed. Thank you very much.

Okay, very good, very good question. When I think about the mix shift that will have to happen, so it's not all pumps. So the thing you have to remember is that the smaller pools specifically above ground in some very small in-ground pools, the single speed pumps are still going to be in place. So they're not going to go away entirely. So the variable speed is really for the larger pools and it is going to be a nationwide program. I think the cut over is going to start to have – manufacturers are going to have to start to decide when they're going to flip the plants. And my suspicion is that there'll be inventory sold into 2021 and then we'll be selling through that inventory, so you won't see a full-year impact really until 2022 and that's a function of how much inventory gets put in the channel. If I look at the price difference between variable speed, single speed, it's about two to one. So overall as far as our equipment, I think pumps are our second largest item in the equipment category. Yes, so...

And what is that ratio when you sell-through, I mean, are you doing excluding these above ground pools, I mean is it 30% variable, 70% non-variable. I thought, it would just because of the electronic or the electricity cost differential, I figured it would be closer to 50/50 today? Can you give us a sense of what that…

It's about 50/50 in terms of dollars, because of the – they're lot more expensive, right.

Right. So that means, two-thirds are actually non-variable speed pumps today unit-wise?

Yes.

Thank you. Sorry for that side conversation.

[Operator Instructions] Our next question comes from Alex Maroccia with Berenberg.

Good morning, guys. So on the tech front, I guess the biggest recent items would be POOL360 and the new NPT Backyard app. I guess can you discuss, number one, where you see revenues process going in the next couple of quarters through POOL360. And then the follow-up is, can you touch on the adoption of the NPT app and if that's started driving any store traffic? Thanks.

Yes. Your question on the POOL360, I want to make sure I understood that, can you repeat that?

Yes, so the – you said the revenues processed in Q3 was about 10% of total revenues through POOL360, right?

Yes, correct.

Okay. So what you want that to be in the next couple of quarters, I mean, do you want 100% in the next year, two years, et cetera?

No, it will never be a 100%. I mean, consider that in our business about 70% of our transactions happen at the counter. So there is a portion of our business and segments of our business that are very tied to POOL360, because they're ordering in advance for construction projects or our large retailers. But for the maintenance folks a lot of those – a lot of our customers are coming into the branch, because they have to come to pick up chemicals and such that they use on a daily basis and many of them just walk up to the counter and order. Do I think it can double from 10% to 20% of revenue? Yes. Do I ever think it will be above 50% of our revenues likely not. Your second part of your question about the Backyard app, we are very encouraged by the adoption rate so far. The number of downloads that we've had and our sales folks, we introduced it at our international sales conference a couple of weeks ago. So they are just getting familiar with it to take it out and roll it out to customers. So it's kind of too soon to tell what the impact is. I can’t tell you that I – we've seen a sales spike because of it. But remember it's – part of it is a passive tool as well, which allows the homeowner to envision and specify and design the pool and then get with the pool builders. So the cycle on that process is not immediate, that's a – I've designed the pool this is exactly what I want, this is a look I want. Then I have to go start interviewing builders. So I wouldn't look for a big spike because of it. We just think that that's something that we'll continue to fuel market growth and then the pull-through demand we should see.

Okay, got it. And then second question is just on the backlogs, are you able to give us a split of what we're seeing right now in resi versus commercial. And then on the product side, what the backlog would be in materials versus equipment?

Yes. I mean, that backlog is a very – we hear about it, customers tell us about it, but there is really no way to kind of, track and know what that is, so they're busy and weather allows them to be as busy as they can be. But in terms of tracking that on a more formal basis and how much is resi versus commercial, all of our contractor customers are busy. So that's the best that we can tell you, they're are optimistic as well about what they see it coming in the year ahead as are we and other than that, not much, we can say.

Yes, we have better visibility on commercial, because some of those are built-to-suit projects, it's a portion of our business, but on residential, consider that we are expected to have that product in stock. So if they're going to build a pool, they don't order a couple of weeks in advance or a month in advance. They just expect us to have it in stock, they need to come by and pick it up or so it needs to be delivered on the next day basis.

Okay. That's great. Thanks a lot guys.

Sure.

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

Yes. Thank you all for attending the call this morning. The next time we speak will be February 13, 2020, where we will cover our full-year 2019 results and discuss expectations for 2020. Thanks again, and everybody have a great day.

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