Thank you for holding, and welcome to Rockwell Automation's Quarterly Conference Call. I need to remind everyone that today's conference call is being recorded. Later on the call, we will open up the line for questions. [Operator Instructions] At this time, I would like to turn the call over to Aijana Zellner, Head of Investor Relations and Market Strategy. Ms. Zellner, please go ahead.

Thank you, Julianne. Good morning, and thank you for joining us for Rockwell Automation's third quarter fiscal 2023 earnings release conference call. With me today is Blake Moret, our Chairman and CEO; and Nick Gangestad, our CFO. Our results were released earlier this morning, and the press release and charts have been posted to our website. Both the press release and charts include and our call today will reference non-GAAP measures. Both the press release and charts include reconciliations of these non-GAAP measures. A webcast of this call will be available on our website for replay for the next 30 days. For your convenience, a transcript of our prepared remarks will also be available on our website at the conclusion of today's call. Before we get started, I need to remind you that our comments will include statements related to the expected future results of our company and are, therefore, forward-looking statements. Our actual results may differ materially from our projections due to a wide range of risks and uncertainties that are described in our earnings release and detailed in all our SEC filings. So with that, I'll hand it over to Blake.

Thanks, Aijana, and good morning, everyone. Thank you for joining us today. Let's turn to our third quarter results on Slide 3. We saw good double-digit growth in both sales and earnings this quarter as component shortages continue to ease. Lead times also continued to reduce across our product lines with recovery to pre-pandemic lead times expected for all products by the end of the calendar year. We did miss almost a week of planned shipments in May because of a longer-than-expected changeover to a new third-party logistics supplier at our North American distribution center. Shipments from this distribution center recovered in June and we now have higher capacity in place for Q4 fiscal year 2024 and beyond. Both total and organic sales grew over 13% versus prior year with currency and acquisitions roughly netting each other out. Currency translation decreased sales by less than a point and acquisitions contributed over a point of growth this quarter. Similar to prior quarters, the split of our sales by business segment, region and industry was largely driven by the composition of our backlog. In the Intelligent Devices business segment, organic sales were up 8% versus prior year. The changeover in our distribution center had the biggest impact on this segment in the quarter. Within the Intelligent Devices segment, Independent Cart Technology continues to be a disruptive technology, and we had several more strategic material handling wins in the U.S. this quarter. The recent launch of our On-Machine Armor Kinetix motion control products adds to our innovative material handling portfolio. We also had an important win in Europe with SIDEM, one of the world's leading desalination companies where our PowerFlex drives and services expertise are helping this customer deliver economical and sustainable drinking water to millions of people in developing regions. Software &…

Thank you, Blake, and good morning, everyone. I’ll start on Slide 8, third quarter key financial information. Third quarter reported sales were up 13.7% over last year. Q3 organic sales were up 13.2% and acquisitions contributed 120 basis points to total growth. Currency translation decreased sales by 70 basis points, about three points of our organic growth came from price. Segment operating margin expanded to 21.1% and was in line with our expectations as improved productivity offset lower than expected sales. The 30 basis point year-over-year increase in margin was driven by higher sales, volume and positive price cost partially offset by higher investment spend. Corporate and other expense was $32 million in line with our expectations. Adjusted EPS of $3.01 was below our expectations due to our shift in shipments from Q3 to Q4. Adjusted EPS grew 13% versus prior year. I’ll cover a year-over-year adjusted EPS bridge on a later slide. The adjusted effective tax rate for the third quarter was 14.1% and in line with the prior year. Free cash flow of $240 million was $87 million lower than prior year, driven by increases in working capital and income tax payments, partially offset by higher pre-tax income. The increase in working capital was primarily driven by higher accounts receivable and inventory. Inventory grew by six days, primarily in finished goods as a result of the shift in planned shipments from Q3 to Q4. One additional item not shown on the slide, we repurchased approximately 220,000 shares in the quarter at a cost of $62 million. On June 30, $1 billion remained available under our repurchase authorization. Slide 9 provides the sales and margin performance overview of our three operating segments. Organic sales growth was led by software and control, which grew 24% year-over-year. Turning to margins, intelligent…

Thanks, Nick. As we continue to stay close to end users, machine builders and distributors, a few key themes emerge. First, demand remains strong. We’ve mentioned softness in e-commerce and in parts of the Chinese economy, but investment by end users and machinery builders continues across the majority of regions and serve verticals. Second, the global supply chain is improving, but it will take some months to flush the inefficiencies that have built up over the last few years, especially inventory. This is seen at machine builders, distributors and in our own operations. Third, the opportunities for automation to play a strategic role in our customer success have never been higher. Workforce scarcity, American shoring of manufacturing and the premium being placed on business agility are all positive reads for Rockwell. We’re moving fast to meet these needs with new capacity and capabilities. It’s hard to believe, but our Annual Automation Fair and Investor Day are only about three months away, and you should look forward to hearing more about the exciting next leg of our journey. I want to thank all our employees and also our unmatched distributors who have worked so hard to bring us to this point and who collectively make the difference at our customers. Aijana will now begin the Q&A session.

We would like to get to as many of you as possible, so please limit yourself to one question and a quick follow-up. Julianne, let’s take our first question.

Thank you. [Operator Instructions] Our first question comes from Andy Kaplowitz from Citigroup. Please go ahead. Your line is open.

Good morning, everyone.

Hey, Andy.

Blake or Nick, can you give us more color into the order of visibility you have that allowed you to construct Slide 11. If I add all the timing, it looks like you expect a relatively significant orders inflection higher, maybe even in the first half of 2024. And it also looks like you think orders could reach the peak levels again, that you saw in 2022. Is that what you’re attempting to say? And then what markets would you most likely see an uptick in bookings?

Yes. Andy, there’s a few factors that contribute to that outlook for orders. First are the continued high investment levels and some important verticals for us. We see continued investments as we track new CapEx announcements in areas like semiconductor, in EV, in renewables, while we see a general focus on automation at many of our other verticals like food and beverage, life sciences, energy and so on. We also have had a number of conversations with customers and distributors that give us a consistent view that demand remains strong. As I and members of my team have talked directly to machine builders and end users, they’re all proceeding with plans based on the consistent demand for their products. We described in my remarks what we’re seeing in terms of machine builders who are not placing the unusually large advanced orders that they did of say a year ago. And we’ve also had direct conversations with our distributors and in North America, some of our largest distributors are actually seeing year-over-year order increases. So again, that consistently strong demand picture informs that view that we showed you on Slide 11 of orders recovering, complimenting the remaining strong backlog.

Thanks for that Blake. And then Nick, can you quantify how much impact the change in U.S. distribution you made had on sales and earnings in Q3? And then specifically could you go over how to think about margin moving forward for your segments? It looks like you talked about the change impacting intelligent devices, but moving forward should we be thinking 20% to 21% for that segment, which was your prior guide? And then conversely, software margin continues to go up, can you sustain mid-30% margins in that segment?

Yes. As far as the sales impact, we had originally planned when we guided what we expected for growth expectations between Q3 and Q4, we had expected some disruption. We were planning close to a week of disruption that this would be causing in the loss of capacity during our third quarter. That ended up extending by several more days in terms of the total impact it had on us. All in something in the range of $50 million to $100 million of revenue is I think a good ballpark to think about of what we’re seeing of a shift of revenue there between the third and fourth quarter from what we were anticipating three months ago. And then in terms of margin progression, Andy, for the rest of this year, we continue to expect that margins will expand. We think fourth quarter margins will be our highest margin for the year. We continue to expect to see strong margins in our Software and Control business, something similar to what we’ve been seeing the last couple quarters. And as I’ve said for the last couple quarters, we expect sequential margin improvement in lifecycle services. We expect that will be over 10% in Q4. And then intelligent devices as we recapture some of that revenue that shifted from Q3 to Q4, we think added revenue there will be bringing that margin up from where we were in the third quarter. All in, we still expect ITV smart intelligent devices margin to be a little under 20% for the full year, software and control to be well over 30% and lifecycle services will be below 10% for the full year. And it’ll be similar to a little less than what it was in fiscal 2022. But all in progressing nicely with the focus we’re having on productivity there.

Thanks, Nick.

Our next question comes from Josh Pokrzywinski from Morgan Stanley. Please go ahead. Your line is open.

Hi, good morning all.

Hey Josh.

Hey Josh.

Blake, so just on the order normalization and customers, including some of the OEMs adapting to shorter lead times. I sort of get that that’s kind of a – maybe a bit of a one-time accordion squeeze as those folks don’t need to go out the same length of time or even pull that in. Any sense of sizing what that is? What that impact might be on that implied second half order outlook? Just trying to distinguish between the supply chain and sort of the back end of that phenomenon versus maybe what run rate orders might be?

Yes. I mean giving a little bit more color on how this plays out, during the most constrained period of component shortages, we saw some OEMs that were placing orders for a year or more of their equipment demand, where in normal times when lead times were at, let’s say normal for the products that they put in their equipment, that might be only three or four months of demand. Now, that’s not across the board, but we did see cases of those larger orders. As the lead times have recovered actually a little bit faster than we expected over the last quarter or so and as we expect them to continue to improve, then we see OEMs no longer needing to place such long orders. And as they focus, as I said, on flushing some of the inventory and WIP that they have in their operations, importantly, their front log remains strong. And as I visited machine builders and my staff has visited machine builders over the last couple of months that’s a consistent message that their demand remains strong. It’s just they don’t need to place such a large block of orders. Now, I want to put this in perspective. OEMs are in the neighborhood of a third of our business. So we don’t see the same patterns or need for those large orders at users, but that is an effect that’s impacted our machine builders. And in a little bit of a similar timeframe with our distributors, their inventories will relieve as they get those last constrained items over the next couple of months and are able to shift their committed inventory that’s inventory that’s already been committed to specific end user projects.

Got it. That’s helpful. And then maybe for a follow-up, just want to take a step back. I mean, there’s a lot of – there are a lot of elements of the business now where you can sort of see this before and after in terms of investment. We talk a lot about nearshoring, energy transition, you see process orders looking strong on that. But I can’t help notice that 30% of the business is food and bev and consumer packaged goods, where I don’t know if it’s quite as obvious that we’re seeing nearshoring or some fundamental breakout. I know you called out a bigger food and bev win. But maybe just talk about how that piece of the business has seen a secular shift or perhaps hasn’t? If you want to put backlog in context or anything else that would be helpful.

Sure. So you’re right. I mean that as part of our Hybrid Industry segment is the single largest segment of our end market demand. And what we’re seeing in food and beverage and home and personal care is an increased focus on efficiency and resilience. So even though we don’t see the same amount of greenfield investment that we do say with electric vehicles or batteries, those big food and beverage companies are investing in their resilience. So they’re adding some measure of redundancy. They’re investing heavily in OT cybersecurity, which is one of our very fastest growing businesses and meaningful multimillion dollar orders. They’re also dealing with workforce shortages. So we’re all aware that unemployment remains very low. And I think in general, that's a positive read for us, but it creates continuing problems with these manufacturers in staffing those lines. And so they're looking for augmenting the technology that we're providing with highly trained workers as those workers are more scarce. And we're seeing our offering result in some important competitive wins. We've added more ways to win. So it's not just our core technology, it's our cybersecurity services, and we talked about several wins with Plex as the synergy wins ramp up there as we turn on that market access machine. So those are some of the things that are driving the good food and beverage and home and personal care growth that we're seeing this year.

Understood, appreciate it. Best of luck.

Yes, thanks Josh.

Our next question comes from Julian Mitchell from Barclays. Please go ahead. Your line is open.

Thanks very much. Maybe not taking a step back. If we look at Slide 11, you've got the order trends line chart there. Trying to think about backlog-to-sales coverage and where you think that normalizes. As you said, pre-COVID you were 20% odd backlog to sales. Recently, you've been well over 50%, but that will come down. And I just wondered your sort of best views on where it settles out. Because I guess, if we look at some of your peers like FANUC, they've all seen this huge orders slump as well, and they're talking about customer inventory depletion through next year. And I guess, one could also make the case perhaps that more localized supply chains can mean shorter lead times and order patterns, not longer ones. So just wondered sort of your perspectives on that and testing that conviction around why the orders improve from early calendar 2024?

Sure. I'll make a few comments, Julian, and then Nick may have some additional detail. As you think about the composition of our business, for a starting point, we said the backlog that we expect to finish the fiscal year in a couple of months with is remaining high between $4.5 billion and $5 billion, and 80% of that is shippable in fiscal year 2024. I think your question is, okay, how does that develop? And what is beyond that? Think about the product backlog as lead times return to normal for products at the end of this calendar year is getting back to its normal low levels of backlog. We traditionally looked at products as having lead times of days or weeks that either ships directly off our distributor shelves or we build it very quickly in our factories. And I think that gets back in fiscal year 2024. There's a portion of that product business within Intelligent Devices that is configured to order. And that continues to have lead times that are measured typically in weeks, sometimes in a couple of months. That business has been really strong for us here recently. We think we're gaining considerable share there. And so that's going to be a somewhat meaningful component of backlog even after 2024 within the Intelligent Devices area. And then as Lifecycle Services becomes bigger, continues to grow, then we typically have seen somewhere in the neighborhood of half a year of backlog for Lifecycle Services. So backlog becomes smaller as we leave fiscal year 2024, but it remains considerably larger than the $1.5 billion or so that you remember from pre-pandemic. Because we're a bigger company and we have some of these new components, I would also say there's software and recurring revenue that continues to grow nicely. We talked about ARR growing 17% this quarter. And so that's a part of the equation as well. Nick?

Yes. And Julian, to frame it up a little in the way you asked the question where pre-pandemic backlog closer to 20% of our revenue and more recently this year where we're around 50% or higher than 50%. I don't – based on the things Blake was just describing, I don't think it will go back down to 20%. But something in the 30% or low 30s percent. I think that's a reasonable estimation right now for us, Julian, of where to think where our backlog is in a more normal state.

That's very helpful. Thanks. And I appreciate it's very difficult to call. Thank you for the thoughts. Maybe on the areas or markets where you're seeing or expecting the most severe orders normalization, do we assume it's mostly discrete markets globally? I think China, there's obviously some orders pressure that your peers have talked about, but is it sort of a global phenomenon across various discrete markets? Is that the way to think about it?

Yes. I think it's the phenomenon that we described with machine builders, which is not exclusively in discrete. We have a good business with skilled OEMs, process machine builders as well, but they're buying product. It's less weighted towards engineered solutions. So I think that's where you've seen that phenomenon as they were placing orders for a year or sometimes more of their machine coverage, and they don't need to do that anymore. And so they're looking at opportunities to improve their cash flow, get the existing equipment out as the constrained products from us deliver and then to fill their forward machine needs with smaller orders because they can depend more on the lead times.

Great, thank you.

Yes, thank you.

Our next question comes from Jeff Sprague from Vertical Research. Please go ahead. Your line is open.

Thank you. Good morning. Hello, everyone.

Hi, Jeff.

Good morning, Jeff.

Good morning. Sorry if I missed it. I was on a few minutes late, but a lot of talk about future backlog. But could you just square us up on where the backlog actually ended in the quarter, and also kind of what the price volume complexion was in the actual quarter?

Jeff, I'll take the second part of your question first. Of our 13% organic growth, 10% of that was volume and 3% of that was price. And it was very much like as we expected. This was the quarter where we are starting to lap ourselves against the more significant price increases that we were realizing in the second half of our fiscal year 2022. In terms of the backlog, we haven't put out a specific number on it, Jeff. It did come down some in Q3, and we expect it to come down further in Q4 to that $4.5 billion to $5 billion range. But we haven't put a specific number on that, partly weaning ourselves off of like frequent updates on all of that, but giving you a trend of where that's going.

Okay. Great. Yes, it's just helpful to have the anchor if we're going to talk about the future, right. So we can all relate to that in future conversations, but I get it. And then just on investment spending, is there actually a change in the year outlook on how you'll – the level of investment spending or just a timing between quarters?

Jeff, investment spend is staying almost exactly where we've been expecting, both for the year and by quarter actually. It's very, very much following our plan.

Okay, great. I'll leave it there. Thank you, guys. Appreciate it.

Thanks, Jeff.

Our next question comes from Andrew Obin from Bank of America. Please go ahead. Your line is open.

Hi, guys, good morning. Can you hear me?

Yes, Andrew.

Hey, Andrew.

Hey, just as you think about it seems that you are about to embark on a multi-year growth spurt. How should we think – how do you guys think about your cash conversion just structurally going forward? Do you just need to accept permanently lower cash conversion? We just need to invest in working capital and growth, and if not, what levers can you pull to sort of get it back to this 95% level that we've had?

Yes. Andrew, thanks for that question. The – our longer-term plan and expectation is that we should be at 100% free cash flow conversion or averaging that, that over time, even in a period where we are growing more substantially than we have, I’ll say pre-pandemic. And with where we stand now with our working capital, where we’re estimating it to exit fiscal year 2023, we think that creates some tailwinds for us in cash conversion in the next couple years for us that even in a higher growth world, we can still be generating something from an operational standpoint closer to the 100% free cash flow conversion. There are a couple headwinds, I’ll just want to make sure you’re aware of Andrew. One is we are at the point now where we are making more substantial cash tax payments on the transition tax that was part of TCJA. Some companies adjust that out of their free cash flow conversion. We don’t – we keep that in there. And we’re also being impacted by the recent requirement that we capitalize for tax purposes, our R&D expense, and that that’s having a several percentage point between 5 and 10 percentage point impact to our free cash flow conversion in the next few years. It’s something after five years or six years we work our way through, that just becomes part of the base, but it is having that between 5% and 10% impact to free cash flow conversion. And then the last I’ll note is as we’ve been liquidating our PTC shares, realizing the gain, the nuances of how free cash flow reporting is that gain is not part of our denominator in that equation, but the cash taxes is part of that – of the numerator in that equation, and it’s just a nuance in pointing out that has impacted us this year and could impact us in coming quarters as well. But I’ll call those more noise versus your underlying question, I think on our – the ability of our business model to be generating 100% free cash flow conversion.

Great. And then just on your ARR I think 17% very healthy. Could you give us a look sort of under the hood what the components are, which portions of your business is doing better? Maybe talk about MES, talk about Fiix, Plex, whatever it is you guys want to talk about, but just give us a sense of what’s driving the software growth. Thank you.

Sure. So I mentioned a few wins with Plex in the quarter. And Plex has continued to be a good performer for us both in terms of the expansion of existing customers, as well as new logos where Rockwell’s market access gave us opportunities there. So Plex was a strong performer in the quarter. Fiix as well with the asset management. These are two SaaS applications that are doing quite well for us, and contributed substantially to that 17% ARR I mentioned some wins with PTC. Those are subscription wins. And those were some major competitive victories for us in the quarter. And then on the high value services side, cybersecurity services, and I’ve talked about that that’s been right at the top of our fast growing businesses and we have a recurring revenue component of cyber. So those things were probably at the top of the list and contributing to what you’re right, was really good ARR in the quarter.

Thanks so much.

Yes. Thanks, Andrew.

Our next question comes from Steve Tusa from JPMorgan. Please go ahead. Your line is open.

Hi, good morning.

Hey, Steve.

Hey, can we just start – can you just remind us, I mean, you guys were relatively – we never really had this orders discussion before COVID, what, like, your book-to-bill was generally like around one back then, right? Is that about right?

Yes, Steve, that, that is correct. The only exception is our lifecycle services business component that could have some nuances from quarter-to-quarter, but generally we were pretty much a one-to-one book-to-bill.

Right. So like eating in the backlog this quarter, you mentioned, so obviously your orders were like what were they like a little bit above two or something like that?

Yes. We haven’t given the specific order value for Q3, but we gave the full year expectation of $8.5 billion to $9 billion of orders.

Okay. And when we look at this kind of like daily order volume, I mean, like that, that would kind of equate to the quarterly order numbers I would think, because that’s not like scaled or adjusted for seasonality or anything like that, right?

That that is correct. We’re not adjusting for any seasonality here.

Yes. Okay. That, that, that’s fair. And then just the last question, just philosophically, you guys went from like not really giving orders to maybe not even – not disclosing them this year at one point, I think you guys were thinking about that. Now you’re disclosing them and now you’re kind of like forecasting them. I guess, are we going to continue to get this level of color as we go through the next couple of quarters? Like maybe like just philosophically any view on like maybe normalizing some of this disclosure billion it just seems like there’s more provided, but it’s in different forms and it just seems like it’s not particularly as straightforward as maybe it could be.

So Steve, we’re continuing to provide the information that we think is most important to investors and over the last few years, as you said, orders have become a more important component as they have decoupled from shipments at different times. And so we felt it was important to provide that additional information. As we look at going forward, we’re going to continue to look at where orders remain material to investor decisions and to provide that kind of information. And we continue to look at how we’re making decisions about running the business going forward and providing you some insight into that. And that’s why it’s going to take some different forms as time goes on, because the value of it and the horizon of that I think are important. So this quarter we made the decision to give a little bit of a view going forward and showing on that Slide 11, the relationship between orders and big macro events going forward so that you and investors can put that into perspective.

Yes. And it is helpful. So we thank you for all the extra disclosure here regardless. So thanks Aijana for that. Really appreciate it.

Our next question comes from Noah Kaye from Oppenheimer. Please go ahead. Your line is open.

Thanks for taking the question. I just want to go to lifecycle services, several quarters continuing of positive book-to-bill. You commented on margins for this year. How do we think about incremental margins going forward, especially as you start to get this sort of richer mix, right? I know a lot of revenue associated with what comes out of this ends up in SMC but just help us think about incremental margins going forward.

Yes. As I think about where we’re going with margins in our lifecycle services business in the next couple years, we expect that lifecycle services will be an outsize contributor to our margin expansion in the coming years. So we – one way we think about our margin expansion is through our core conversion of the 30% to 35% range. That would imply that lifecycle services is going to be helpful to that number. So if as I look over the next couple of years, I believe lifecycle services will be our highest margin expansion business segment of the three segments.

Yes. And I would say that, the Sensia contribution, which is in lifecycle, we have seen improvement there and we expect to see continued improvement. So that’s a major component.

Thanks. And maybe just want to step back and ask a broader question about the demand environment. In past quarters, you and the industry and trade press and all sorts of folks have talked about the long runway here from IRA, IIJA shoring all these trends. And when you look at a quarter like this and see, some of the order dynamics and understand a lot of that’s just supply chain normalizing. I guess, when we step back, where do you think we kind of are in this wave of manufacturing investment and specifically in the United States?

Yes. I think – I like looking at a vertical by vertical approach of this, because it breaks it down into, I’d say, more objective components EV and battery by any objective measure, there is continued strong investment as people are building out the capacity to build more electric vehicles. If you look at any city in the U.S., the number of electric vehicles remains low, all projections of that’s going to increase. And there’s nowhere near as much capacity needed to serve that demand, even with the announcements of new greenfields that have already been made. So we see that as a multi-year trend, semiconductor for national security reasons and to be able to reduce geopolitical risk impacting the semiconductors that make our world go. We see that as a multi-year trend. And importantly, it’s not just the fabs, it’s all the supporting infrastructure that’s needed to make that stick as well. We talk about redundancy and resiliency in some of the other industries, food and beverage, life sciences with offerings not just the core automation, but the additional software and the services. I think these are multi-year trends. Workforce, again, with unemployment as low as it is, it’s just not possible to build the things that we need to preserve a standard of living without the technology augmenting a highly engaged workforce. Those two things are going to be required across a broad swath of the industries that we serve. So I think the outlook for automation remains good over a multi-year period. We’re seeing the current impact of some of the ordering dynamics that we’ve talked a lot about on this call, but the fundamental outlook for automation and Rockwell’s ability to outperform, I think is very strong.

Julianne, we’ll take one more question.

Thank you. Our last question will come from Nigel Coe from Wolfe Research. Please go ahead. Your line is open.

Aijana, thanks for fit me in here. Hi guys. Good morning. So yes, we’ve covered a lot of ground here. But just North America was 1% organic, so even if we factor in the $50 million to $100 million impact from the DC, it still seemed quite weak. And I’m sure there’s some inventory headwinds there, but are we seeing any push out in projects, some of the larger projects in North America?

The main contributor to the growth in North America is really the composition of the backlog. And in fact, as we look at the orders in North America, they found pace the rest of the world year-to-date in fiscal year 2023. There are certainly anecdotes of projects that have been pushed, but we have not seen that as a prevalent trend and we continue to see low cancellation rates among within our backlog.

Okay. That’s very clear. And then Nick, your comments on sort of what a normal backlog is, and obviously higher than what it’s been in the past, but seems to suggest that we should be expecting backlog to maybe burn down towards maybe close to $3 billion. Is that fair?

Yes. It’s dependent on what revenue is, but for those reasons that that Blake went through in our mix, we just don’t see it getting back to that 20% that it used to be, but something in the 30% to 35% range and yes, multiply that by our revenue, and that’s our best estimate now. I think in the coming quarters, we’ll keep learning more about that, but we ask for our best estimate right now. That’s where we are.

Okay. Thanks guys. Cheers.

Thank you.

Thank you everyone for joining us today. That concludes today’s conference call.

At this time, you may disconnect. Thank you.