Ladies and gentlemen, thank you for standing by. Welcome to the Qurate Retail, Inc. 2018 Q3 Earnings Call. [Operator Instructions]. As a reminder, this conference is being recorded November 9. I would now like to turn the conference over to Courtnee Chun, Senior Vice President of Investor Relations. Please go ahead.

Thank you. Before we begin, we'd like to remind everyone that this call includes certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including statements about business strategies, including new initiatives, market potential, stock repurchases, future financial performance, market conditions, the integration of HSN and expected benefits and synergies, carriage agreement renewals, future impact of accounting changes, future expenses, sales demand, customer growth, new service and product launches and other matters that are not historical facts. These forward-looking statements involve many risks and uncertainties that could cause actual results to differ materially from those expressed or implied by such statements, including, without limitation, possible changes in market acceptance of new products or services, market conditions conducive to repurchases, the availability of acquisition opportunities, competitive issues, regulatory issues and continued access to capital on terms acceptable to Qurate Retail. These forward-looking statements speak only as of the date of this call, and Qurate Retail expressly disclaims any obligation or undertaking to disseminate any updates or revisions to any forward-looking statement contained herein to reflect any change in Qurate Retail's expectations with regard thereto or any change in events, conditions or circumstances on which any such statement is based. On today's call, we will discuss certain non-GAAP financial measures, including adjusted OIBDA, adjusted OIBDA margin, adjusted EPS and constant currency. The required definitions and reconciliations, including preliminary notes and Schedules 1 through 3, can be found in the earnings press release issued today, which is available on our website. Today, speaking on the call, we have Qurate Retail President and CEO, Mike George; CFO, Mark Carleton; Executive Chairman, Greg Maffei. A couple of housekeeping items before we get started. As a reminder, at the beginning of 2018, we changed our revenue recognition in accordance with new accounting standards related to recognizing branded credit card income as revenue rather than an offset to SG&A expense. Throughout our comments, unless noted, we'll discuss Q3 net revenue results for QVC U.S., HSN and zulily as if the credit card income remained an offset to SG&A expense as it was in 2017. We believe this provides the most comparable review of our year-over-year performance. In accordance with new accounting standards, we also now recognize revenue at the time of shipment rather than delivery. We did not adjust our results for this change in our comments on this call because this impact is expected to balance out over the course of the year. For Q3, the new delivery-based standard increased Qurate Retail's reported net revenue growth approximately 65 basis points; operating income margin, approximately 30 basis points; and adjusted OIBDA margin, approximately 20 basis points. Our reported results and the impact of the revenue recognition changes are included in our earnings release issued this morning and in our SEC filings. Now I'll hand the call over to Mike George.

Thank you, Courtnee, and welcome to everyone on the call. We have several topics to cover today, including improved performance across a number of businesses in the quarter, progress on key strategic initiatives, including the important developments we announced last month, and the addition of our new Group CFO, Jeff Davis. Jeff has just started with us, and I've asked him to join the call today to introduce himself. First, a quick financial overview. Our solid third quarter results demonstrate continued execution of our strategy to engage our customers with compelling products across multiple shopping platforms. Qurate retail revenue increased 2%. Operating income decreased 6%. Adjusted OIBDA was essentially flat. GAAP EPS was $0.16, and adjusted EPS was $0.37. Looking at highlights across our portfolio. QVC U.S. increased revenue and showed solid margin expansion, helped by improved trends in average selling prices. Customer engagement on broadcast and new platforms continued to grow. QVC International delivered local currency revenue growth in nearly every market and reduced the margin pressure from the prior quarter. HSN achieved good progress in several key areas: sales, viewership, digital engagement and new customer acquisition. Our initiatives to expand our product assortment and reduce promotional activities played an important role in the improved financial performance. zulily once again posted an outstanding quarter, driven by continued strong customer acquisition. And at Cornerstone brands, Ballard Designs and Garnet Hill delivered strong results, which were offset by continued softness at Frontgate and Grandin Road. We continue to generate healthy customer engagement across our video commerce business units. In the U.S., TV viewing minutes on QVC and QVC2 grew 2%, and viewing minutes on our digital sites and our nontraditional platforms like Facebook Live, YouTube, Roku, Apple TV and our newest platform extension, the QVC app on Amazon Fire TV, increased…

Thank you, Mike, and good morning, everyone. I'm delighted to join Qurate Retail at a time when we have a great opportunity to build on what is already a legendary retail company led by a global iconic brand. My background in traditional retail, I'm well versed in the challenges of transitioning business models to the digital and social world we live in today. What excites me about Qurate is our video commerce business already resides in a place where many traditional retailers would love to be. We certainly have hard work ahead, but Qurate Retail has a capital-efficient model that continues to grow customers and creates content that is distributable across a continuum of platforms to which shoppers are moving. It's a tremendous opportunity at a vital moment in retail. And I've spent my first few weeks with Mike and the team diving into the business and the work that's underway. I look forward to meeting many of you at the investor event next week and in the months to come. Now I'll turn it back over to Mike.

Thank you, Jeff. Let's now move to the operational review of each of our businesses, starting with QVC U.S. Revenue grew 1% in the quarter, adjusted for the impact of the credit card reclassification. Pricing trends improved, with ASP up 1% on flat unit volume as a result of better management of offer prices and improved product mix. As you may recall, last year, a systems outage at the end of Q2 '17 delayed shipments, shifting approximately 1% of sales into Q3 '17. Adjusting for this shift, revenue grew 2% in the quarter, demonstrating our sales growth trends have been relatively constant over the course of the year despite facing a steeper year-over-year comparison this quarter. Looking at our category performance in the U.S. We saw strong growth in accessories, particularly in footwear from key brands such as Skechers, Bionic and Vince Camuto and the launch of Koolaburra By Ugg; as well as strength from loungewear and intimates. Beauty and consumer electronics rebounded from the Q2 decline to growth in Q3. In electronics, home security, streaming devices and OLED TVs grow sales. In beauty, growth in our core and emerging brands was driven by strong customer reaction to our digital store expansion and digital marketing investments. We also drove demand through several major new launches, including an extremely strong launch of Urban Decay, exclusively on our digital platforms, followed a few weeks later by its on-air premier. Our home category declined, primarily due to softness in home improvement, which was partially offset by gains in home decor, reflecting our successful Christmas in July programming as well as health and fitness. We continue to reduce jewelry airtime and once again saw improved productivity per minute as we focused on delivering a better customer experience through targeted jewelry events. QVC U.S. operating…

Thank you, Mike. Let's take a quick look at the liquidity picture. At the end of the quarter, Qurate Retail had attributed cash and liquid investments of $532 million and $7.5 billion in principal amount of debt. QVC's total debt to adjusted OIBDA ratio as defined in our credit agreement was approximately 2.4x, which includes zulily's adjusted OIBDA as compared to a maximum allowable leverage ratio of 3.5x. Total leverage for Qurate Retail Group, which includes Q, zu, HSN and Cornerstone, was approximately 2.3x. I'll hand it over to Greg.

Thanks, Mark. During the quarter, we repurchased Qurate Retail stock. And for the period August 1 through October 31, we bought back $247 million of shares. Marriott Vacations Worldwide completed its acquisition of ILG, and we received cash and just under a 6% stake in Marriott Vacations. Subsequently, on September 26, we sold that for gross proceeds of $313 million, a portion of which settled in the fourth quarter. Our total after-tax proceeds are estimated to be about $475 million, including both the initial cash received and the subsequent sale of VAC equity. As a reminder, we will be holding our Annual Investor Meeting on November 14 in New York. Hope to see a bunch of you there, and there will be video. If you'd like to register, please see the agenda. Please use the link on our homepage. We appreciate your continued interest in Qurate Retail. And with that, operator, we'd like to open up for questions.

[Operator Instructions]. And we'll take the first question today from Eric Sheridan with UBS.

Maybe going back to the reorganization that was announced in October. Just wanted to know any granularity we could get as we think about some of the costs versus some of the synergy benefits, not only in Q4 but as you think out to '19 and beyond just so we should have our pencil sharpened correctly on sort of how that works through the financials. And then secondly, on the buyback, just want to make sure I remember this right. I think there was a goal of sort of returning around $1 billion or the free cash flow from the year to shareholders. Just want to make sure what you had previously communicated as measured against the $623 million you bought back through the end of September.

I think we said there was a goal -- Mike, do you want to comment? No?

If you go into buyback, I'll...

Okay, Mike, go ahead.

So I'll take the first part, and Greg, I'll let you comment on the buyback. We laid out kind of the cost benefit expectations in the announcement that we made in mid-October, so I won't go in a lot more detail on that right now. We will show a schedule at next week's Investor Day that kind of shows the year-by-year flow of those -- both synergy benefits and onetime costs. So we'll be a little more granular on the year-by-year flow of that next week. That's on the cost benefit side. And again, just as a reminder, we said $120 million to $125 million of total cost benefit, of which about $40 million would be achieved in 2019. But we'll share a full schedule next week. We do expect much in the way of revenue benefit as well, so this is as much a strategic combination as it was about cost savings. And so we don't put a specific metric to the sort of revenue benefit. But as I think you could see, even in some of the early results from Q3 when we were still working as two sort of independent business units, we're just finding a lot of traction in aligning brands, programming across the two businesses. And we've been particularly encouraged to see that when customers do cross over from one brand to the other brand, they increase their total spend with us. So we know it's a good thing to manage these two businesses in an aligned way strategically and to get customers to cross over. So we'll get kind of very granular on the cost benefits, but I would just note that I think the biggest benefit is enabling us to achieve the kind of long-term revenue targets that we have for the company. And, Greg, you want to comment on the buyback side?

Well, and I would just agree with you, Mike. I think the cost benefits are concrete, real and short term. The longer-term strategic benefits and revenue synergies of putting the two businesses together in a way it solidifies our strength in the video commerce and related e-commerce areas is harder to measure but has a lot of long-term impact. We are on target to about $1 billion for the year. Some of that will be price dependent, but I expect we're going to be in that range.

And we'll now take the next question from Barton Crockett with B. Riley FBR.

I guess a couple of things. One of them is I was very interested in your discussion of a new TV carriage agreement for HSN in the quarter. And I understand there's not perfect detail for -- which means there's a limit on what we're probably going to know -- be able to know incrementally. But in general, I mean, I think one of the things a lot of us have wondered is, is there an opportunity to have HSN TV carriage move to something that's closer to the type of features and economics that QVC has been getting in the U.S.? And I'm just wondering if you can comment on whether this HSN deal in any way moves in that direction meaningfully.

So I would make a couple of comments, Barton. Overall, we feel high confidence in the synergy targets we've already shared related to affiliate savings. There may be upside beyond that, but we're not at the point where we would be confident declaring that. But we certainly feel very good about, at a minimum, hitting the targets that we have shared. One of the things I've talked about is we're going to look at both quality of carriage and cost reductions on the carriage. And depending on the agreement, some agreements may lean more towards less kind of reinvest savings and quality, and others might lean more on bring cost savings to the bottom line. I would say we -- with this recent carriage that we renewed, we saw both absolute cost savings separate from the accounting classification, but I would say it was more about quality in this particular case. We got HD carriage, which we've not had previously. We got an additional channel placement, and we did see a real impact in the quarter, so we could directly see the sales lift from those moves. So again, carriage to us is as much about give better quality to drive better sales as it is drive savings. This one had a little bit of both, more of weighted, I would say, to the driving sales piece of it than the cost savings, but it did have both.

And just a way to understand kind of maybe at a little bit better level the materiality of this, I mean, would you say this was a major operator or a small one? And when you talk about the shift of expense into D&A versus kind of OpEx, is that all of the carriage fees or just a portion of them, if that is accounted for differently?

It's just a portion of -- I won't comment on operator itself. I mean, certainly a good-sized operator. I won't go beyond that. The -- again, the structure mirrors QVC's structurally. So there are these upfront payments that help you secure the good channel positioning that go -- that are amortized over time. But still, the bulk of the expense is still incurred on an operating basis. So it's a variable-based cost structure associated with our sales performance that hits the operating line that's, I would say, the bulk of the expense, but there is a chunk that gets moved to this upfront placement fee approach with amortization over time.

Okay. And then just one other kind of topic quickly. There have been times historically where your business -- when there are big events on TV that people are watching, where people watch less TV shopping and maybe do a little bit less business with you. I'm just wondering if you could tell us if these midterms, which had so much of the country riveted, have that type of impact on viewership of QVC and HSN or not?

Yes, I wouldn't want to comment specifically on anything in the quarter. Certainly, in the midterm year, you're going to have some viewership distraction. You're going to have some impact on marketing spend and effectiveness when you're competing with a lot of other forms of marketing spend. But beyond that, I wouldn't want to comment on any sort of specific impacts on the company in the quarter.

We'll go to Edward Yruma with KeyBanc.

I guess, first, I know you had struggled to the end of last year and early this year with kind of inventory outages at HSN or to tighter buys under the previous management. How do you feel about your inventory positioning and composition as we head into holiday? And then, again, as a follow-up, in the core Q business, you've done a good job recently turning the needle from a new customer perspective. As these kind of core Q consumers are aging or these new customers, how are they behaving differently than maybe your legacy Q customer?

Thanks for the question. So on HSN inventory, I would say that the absolute levels of inventory have largely normalized. So I think we've gotten kind of back to where we need to be from a level of inventory. Of course, the harder part is making sure you have the right inventory, and we're certainly still in that mode of trying lots of new things. Some work, some don't. And it's one of these things where you increase your batting average over time as we get more experience. So feel good that we've gotten inventory levels back to where they need to be. I feel good that a number of the new initiatives are working and have resulted in a material improvement in the sequential revenue trend, Q2 to Q3. And our goal is to kind of keep on that path as we see how the customer responds to the various things we're trying. In terms of new customers, I would say, overall, we're very encouraged by the quality of new customers. Fundamentally, we're seeing new customers perform at comparable levels to any prior class. So the aggregate new customer health is strong. Lifetime value is consistent with what we've seen in past years. So as the business has moved towards digital and acquiring more customers on digital and reaccelerating customer growth, we're really holding on quality and really encouraged by that.

Next is Heather Balsky with Bank of America.

I guess to start, to piggyback off of Eric's question earlier, can you just talk about with regards to synergies how you're thinking about reinvestment back into the business and how much it might flow through to the bottom line?

Heather, I would say, it's early to give a sort of specific framework for that. We certainly expect some to flow to the bottom line and some to be reinvested, but it all -- actually, it's going to be kind of real-time decisions as we move through the next few years as to what feels like has the maximum return for the company. So clearly, the biggest single source of reinvestment would be digital marketing. As you know, we have a very low digital marketing spend today, so we think it can be additive to sales growth over time as we ramp it up, but we won't ramp it up if it is negative in its net present value. We'll ramp it up, even if it costs us for the quarter, if it has a positive lifetime value associated with it. So I would say, the big gating factor in giving you a more specific answer is, quite frankly, how effective we are in spending back on digital marketing. We'll be disciplined about that. We'll only do it if it has a positive return over time. But if it's doing that and it's driving sales growth, you might see us sweep more the savings into that kind of a spend. And on the flip side, if we're really not getting that benefit, then we'll push that kind of savings to the bottom line.

Great. And with regards to ASP, it was positive this quarter. I was curious if you can talk about what you saw in regards to your initiatives around pricing and ASP.

Yes. We're very encouraged after several quarters of erosion in ASP to get back to stability and even a little bit of growth in ASP. It wasn't any one thing that drove it, but really, just a number of initiatives. At the most macro level, the mix shift of the business, I talked about strong growth in consumer electronics and in accessories, and those are 2 of our higher price point categories. So mix shift was favorable to us, a little bit offset by the decline in jewelry, which is also high price point, but on balance, favorable mix. But even within categories that are lower price point categories like decor or household, we saw a healthy increase with ASP. So I think it's a lot about just focusing on every offer, making sure we're pushing ourselves to give the customers the best-quality offer at the best value, not always go for the lowest price option but the option that's best quality, best value, looking hard at the TSV line, looking hard at other key items. So part of it is mix, and that will ebb and flow as the broad mix of the business evolves over time. That was favorable in the quarter, and part of it is just the real micro focus on getting the right offers in the marketplace.

I'm going to throw in one last one on the balance sheet. I was just curious if we can get an update on how the company is thinking about leverage and, in particular, the exchangeables and if there's an update there.

I'll let Greg or Mark take that.

Yes. I think we continue to look at ways to refinance or take out and manage that exchangeable process. Obviously, part of that is related to the tax efficiency that we get from the interest relative to those and, certainly, the liquidity that we have. So I think our capital allocation strategy relative to that is unchanged. Where we see the returns and perhaps buying back or taking out some of those exchangeables early, we will continue to do that. If we see the value in buybacks or -- and investments back into the business or perhaps buying other companies, we'll look at that as well. But I think we certainly have a strategy on the exchangeables, and that's unchanged.

And I think that's right, Mark. And I would add only one thing. We have also gone into making tax-related investments which have high rates of return, to some degree, generate tax attributes that offset the tax-negative attributes we will eventually have to pay.

We'll go to Jason Bazinet with Citi.

I just had one question on the revenue recognition at the time of shipment as opposed to delivery. You said that was favorable in Q3, but you said it will normalize over the full year. I didn't quite understand that. Presumably, you always ship before you deliver, and so I would think that would just be sort of a pull forward this year and then normalize next year. So do you mind just explaining that?

Well, it's just a -- you're still comparing a 365-day period from a year ago to this year. So you're not actually counting more or less days in a year. So it's just a matter of what your comparison is. So when we give you these comparisons, either on an adjusted basis or under the old -- either under the current basis or under the old methodology, both of them are comparing same number of days this year, the same number of days of shipments the prior year. It's just a matter of what time periods you're referencing. So if in 1 particular quarter, depending on what days you're including, it might have a positive or negative impact, but it's essentially neutral over the full year.

Essentially, you change the time upfront and what the -- you lose 2 or 3 days in 1 year. But in the next year, you still have exactly 365 days, and you still have that period from December 28 to December 31 in 1 year's results. It just may be -- and the change, that's a different 3-day period than it was the other 3-day period. Once we get to a full year, we have a full 365 days of results in those numbers.

And you may be, as Mark suggested, comparing quarters which are off by a couple of days, but they will still contain in future quarters the exact same number of sales and/or shipping days.

We'll now go to Alex Fuhrman with Craig-Hallum Capital Group.

I wanted to ask about some of the new brands that you have launching on HSN. In particular, seems like a really big opportunity to get some of those crossover brands that have been big on QVC for many years and including a lot of the proprietary brands on QVC. And what I'm wondering is, how are you planning on marketing the exclusivity and uniqueness of the things you carry? It seems like you've always done a very good job in the past of really highlighting your proprietary brands in QVC and explaining to the customer how they can't find them anywhere else or can't find this particular item or price. Just curious how you plan on translating that message as you have some of these brands available now in HSN but presumably still just on H and Q and nowhere else in the retail landscape.

Thanks for the question, Alex. I would say that as we're thinking about the cross-brand strategy, we're trying to be very thoughtful about exactly that question and still preserve exclusivity within QVC and within HSN. So when we look at the crossover brands we're sharing and a number of the examples I used like Keurig, we're really looking at sharing major national brands where customers do expect to find those brands in a number of retailers. And so historically, we might have had, let's say, an exclusive agreement at QVC where that brand could not be available at HSN. Now we can open that up and make these brands available at both QVC and HSN. And HSN had similar agreements with their brands that we can now open up as well. So that relates to national brands. We would still then try, even within those national brands, to have an offer at QVC at a certain point in time that is a unique offer that only QVC has and a different kind of offer or configuration at HSN that is unique to HSN. Then on the proprietary brand side, where we have full exclusivity and you don't find those brands at other retailers, in general, we're actually still trying to keep those constrained to either QVC or HSN. So for example, thinking about very successful proprietary brands at Q like Isaac Mizrahi, at this point, we wouldn't -- our plan would not be to have that brand available at HSN. On the flip side, we're using the same team that helps create our proprietary brands and source those brands to source new proprietary brands for HSN that, again, can be exclusive to H. So one way of saying we think exclusivity matters, and we still think exclusivity within Q and H matters so that we're giving customers more choice. And then where we'll get the crossover benefit are these really mega national brands where we're more competing against a number of other retailers and we can consolidate and extend our share capture.

We'll go to Victor Anthony with Aegis Capital.

So a few questions. The first one, on the buying other companies comment you made within the discussion on the capital allocation strategy. So what sort of assets would you consider adding to the firm? So maybe you could just talk about your general M&A strategy. Second, on the China tariffs, trade wars and sort of impacted the business. And third, this is more of a high-level question I tend to get every once in a while about you guys. So how does QVC HSN fit into the mix of the broader -- the media, retail, technology sectors? The business does cut across several ongoing secular trends, whether it be media viewership, whether it be OTT, retail moving to the Internet, what else, maybe social media, time spent, mobile transition. Within all of that, what are you most excited about over the next probably five years? And what concerns you the most?

Mike, do you want to take a shot first or would you like me to?

I'll let you go first.

Thanks. Look, on the issue of acquisitions, we have been -- spent the last few years, I would say, trying to provide a more focused Qurate. We have done 2 scale acquisitions. We've done some smaller ones, but 2 scale ones, which was bringing in the balance of HSN and buying zulily. Both of those, I think, were highly consistent with the original QVC business, obviously, HSN, in particular, where we already have a 38% stake. That having been said -- and we think that process has been a good process. That having been said, I would point out, historically, when we were Liberty Interactive and we had 2 trackers, we effectively moved to a series of capital events across from QVC, utilizing QVC's cash flow to fund over at the other side of the house, which turned into a very lucrative investment in Charter or -- and/or Liberty Broadband. So we have tried to signal the market we're more focused, we're more clear. And I think you would expect M&A to be largely in that space. That having been said, QVC, HSN and zulily are a very large free cash flow generator. And Liberty likes to think of itself as able to allocate capital wisely. We think the general market has given us the permission slip to do that. And I wouldn't say we would think likely to change the mission. But if we found the right opportunity, we would think about it. And we try and signal why we were doing that crisply and clearly, why we thought that was an attractive opportunity. As far as what's across the M&A landscape and where it sits, I think I've tried to say we try to focus on this because we think it's a good space and it's one in which we have a management team which had demonstrated talent how to operate within that space and have success. There are other places in the Liberty portfolio which are concentrating on things like live events or online travel that I think are also attractive. But in general, those things are better left and focused in those areas. Most of what I -- as I started with my opening comments, most of our focus here is going to be on trying to hone our position, which we think is a good one, improve it, strengthen it in the video/e-commerce space, video commerce, e-commerce space. Mike, what would you add?

Not much else to add. I mean, we are continuing to look carefully at acquisition opportunities. A lot of things come our way, and we reach out and explore other things that fit broadly within those parameters that Greg articulated. But we do have a very high bar on making sure that they really fit and are additive and importantly, are at good value and valuation. And so we've passed on lots of things and certainly open to the right opportunities that we think add to this video commerce, social commerce, e-commerce space. But again, we'll be very selective. I'll just kind of, Victor, quickly touch on your couple other questions. On China tariffs, very fluid situation, obviously, in terms of what will end up happening with the tariff situation. We're watching it carefully, but our goal is to work with our vendor partners and to really manage the impact as best we can, trying to make sure we're able to shift suppliers as we need to, shift countries of origin, respond. And I think we have a benefit relative to traditional retail in that we are much more able to kind of shift mix pretty quickly since we don't have our inventory out there in every store. So we'll watch it carefully. We think it's manageable at this point but actually early to exactly assess the impact of tariffs. And then on your other just broader question about the media sectors, I would just sort of emphasize that these mega media trends certainly create some headwinds, but in our judgment, more tailwinds. The obvious headwind is cord-cutting and declining traditional broadcast viewership. But again, I'll just underscore that we have now a multi-quarter track record of actually increasing broadcast viewership, which not many people can say. So we're not…

And our last question for today will come from Thomas Forte with D. A. Davidson.

One quick one. So for Mike, how should investors think about the relative distribution costs for QVC and HSN on legacy distributions such as MSOs compared to your merging efforts such as Roku and now Amazon Fire TV?

Thanks, Tom. I would say, on balance, we expect distribution costs to continue to decline over time. And that's generally been true now for a few years. There are different kinds of arrangements on some of these new platforms, but what you would traditionally call distribution expenses we expect will continue to go down over time. That said, on some of these new platforms, we do need to invest in digital marketing to make people aware of these platforms and to drive an action like to download an app or to engage in some form of digital media experience. So I think you see over time an improvement in the distribution line. I think you see increased expense in digital marketing. And again, the exact mix of those two depends on the comments I made earlier about our success in reinvesting in digital marketing. And I think that wraps up the call. Thank you to everyone for your time and interest in Qurate, and we look forward to seeing you at next week's Liberty Investor Day. Thanks.

Thank you all.

And thank you very much. That does conclude our conference for today. I'd like to thank everyone for your participation, and you may now disconnect.