Rithm Property Trust Inc. (RPT) Q3 2015 Earnings Report, Transcript and Summary

Greetings, and welcome to the Ramco-Gershenson Properties Trust Third Quarter 2015 Earnings Conference Call. At this time, all participants are in a listen-only mode. A brief question-and-answer session will follow the formal presentation. [Operator Instructions] As a reminder, this conference is being recorded. It is now my pleasure to introduce your host Ms. Dawn Hendershot, Vice President of Investor Relations and Corporate Communications. Ma'am you may begin.

Good morning and thank you for joining us for the third quarter 2015 earnings conference call for Ramco-Gershenson Properties Trust. With me today are Dennis Gershenson, President and Chief Executive Officer; and John Hendrickson, Chief Operating Officer. At this time, Management would like me to inform you that certain statements made during this conference call, which are not historical, may be deemed forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Additionally, statements made during the call are made as of date of this call. Listeners to any replay should understand that the passage of time by itself would diminish the quality of the statements made. Although, we believe that the expectations reflected in any forward-looking statements are based on reasonable assumptions, factors and risks that could cause actual results to differ from expectations are detailed in the third quarter press release. I would now like to turn the call over to Dennis Gershenson for his opening remarks.

Thank you, Dawn. Good morning, ladies and gentlemen. I’d like to spend the next few minutes covering three topics. First, I want to say a few words about Greg Andrews’ department and where we are in the process of securing his replacement. Second, I will update you on the status of our capital recycling program and how the sale of our noncore assets and the reinvestment of their proceed is facilitating our focus on owning an improvement our portfolio of large multi anchored shopping centers that are concentrated in a select group of major metropolitan markets. And lastly, I will address the status of our balance sheet and explain the reasons for our revised FFO guidance for the year. Greg Andrews left the company on October 16th after five year tenure, departed on very good terms. Greg left after achieving his primary goal of significantly improving our balance sheet, moving us from being overwhelmingly a secured borrower to primarily unsecured debt and expanding our line of credit capacity to ensure financial flexibility. These goals achieved Greg decided to pursue new challenges and opportunity with another company. Relative to his replacement we have identified a number of great candidates for the CFO position and we will be commencing the interview process. It is my reasonable expectation that we will be in a position to identify our choice before year-end. And starting with the sale of our non-core assets, we have sold to-date $66.5 million of properties consisting of non-core shopping centers, vacant land and land leases that we did not see as part of our future plans. We are in contract to sell or have signed letters of intent for the sale of an additional $43 million. The average cap rate for the shopping centers sold to-date at share was 6%. We anticipate that the balance of the sales for the year will generate a cap rate of approximately 7%. The acquisition this quarter of seven joint venture shopping centers, streamlines our business model, grows of our asset base, broadens our geographic footprint and further concentrates our assets in metropolitan markets. Specifically in great areas where we have a dominant retail destination. In addition to using the dollars generated from our capital recycling program for these acquisition, we will use some of the proceeds from this year sales as well as additional sums we will raise from the disposition of non-core properties to be sold in 2016, to continue to fund our program of value-add expansion, shopping center improvements and the replacement of underperforming tenants. The success of these ongoing efforts can be seen in our ability to attract and install at our core shopping centers. National credit, best-in-class retailers, including Nordstrom Rack, Saks OFF 5TH, The Container Store, Stein Mark, Dick's Sporting Goods, raw stores and others. Further, the inclusion of these anchors has created the additional opportunity to drive rental rates for our non-anchored tenants who will benefit from these new significant draws. It is our intention for the balance of 2015 and well into 2016 to focus our energies on our core portfolio for these growth opportunities. In addition to adding value to many of our legacy shopping centers, the large multi anchored centers we have acquired over the last several years, lend themselves to significant densification and the creation of the sense of place. Both of which translate into above average returns on new dollars invested and ever increasing rental rates. As our ideas for this later group of centers matures over the next several quarters, we look forward to sharing our plans with you. Now, let me take a minute to talk about our balance sheet and year-end guidance. John Hendrickson will provide details on the income statement. Our balance sheet remains strong with leverage metrics well in line with our average interest rates of 4.15%. We anticipated closing another $15 million of private placement debt in early November. These financings are consistent with our strategy of being a corporate follower as the proceeds from these loans have been used impart to refinance secured debt. The result of these new financings is an increase in our unencumbered asset pool to approximately $2 billion. ROI balance at the end of the quarter was $125 million, which will be reduced by year-end as a result of our addition $50 billion private placement debt and our pending asset sales. Our balance sheet strategy remains unchanged, which is to maintain ample liquidity with predominantly fixed rate debt, well staggered maturities and above average term of debt of 6.4 years. Now concerning our guidance, we are revising our 2015 FFO guidance for the year to reflect our ongoing confidence in our business plan as well as to account for a number of one-time items. We anticipate that our comparable year-end operating FFO will range between $1.32 and $1.33, which is of the high end of our prior guidance. In addition to our comparable performance there are four one-time non-reoccurring components that drive our third quarter and year-end numbers higher. They include lower G&A cost of $0.02, which is primarily driven by the resignation of Greg Andrews during the quarter as well as a proactive hold on hiring as we evaluate our human resources needs in relation to our long-term strategic goals. Our normalized G&A number would have been in line with our previous guidance of $22.5 million to $23 million. The second element of our one-time increase involves a re-measurement for the quarter of the fair value of our total shareholder return grants under our long term incentive program. The program is re-measured on a quarterly basis and will be adjusted again at year-end based on our performance measures. The third non-reoccurring component involves the additional income benefit from postponing the timing of a number of our 2015 dispositions, which was primarily the result of a conscious decision to harvest additional sales proceeds from the execution of pending leases. Lastly, we experienced a short-term interest expense savings, as a result of a reversal of the default interest on our Aquia loan, our prepayment of four mortgages without penalty by using our line of credit and by working with our private placement lenders to extend the time for closing on new financings. These four one-time events contribute approximately $0.04 to the quarter and $0.05 to $0.06 to our new FFO guidance for the year of $1.37 to $1.38 per share. Again excluding these anomalies we project operating FFO of $1.32 to $1.33 per share, which reflects the benefits of executing on our business plan. I would now like to turn this call over to John, our COO who will discuss the details of our operations, after which I will conclude with a brief statement about the company’s strategic direction.

Thank you, Dennis. Good morning, everyone. I have now been with the company five months and in that time we have made considerable progress on streamline and simplifying our business model. These changes I believe are important to our continued transformation of the company. As Dennis mentioned, our recent joint venture transactions have largely eliminated our partnership progress. In fact at the sales of our Chester Springs shopping center, which closed earlier this month only three of our current 75 properties are joint venture assets and more than 99% of our annual base rent is generated from our consolidated portfolio. Additionally, we expect to unwind these remaining three shopping centers over the next 18 months to further simplify the portfolio and concentrate our efforts on maximizing the value in our wholly owned properties. To reflect these change in our business plan, you will notice that most of the schedules and supplements now reflect only information related to our consolidated portfolio. Our consolidated portfolio represents all wholly owned properties including the Aquia office building, which we also plan to sell in the next 18 months. So in a very short order, you’ll be able to evaluate Ramco based on 100% owned high quality shopping center portfolio. Now let me walk through some of this information and add some color. Our overall cash NOI was $5.4 million higher in the comparable quarter due to our 2014 and 2015 acquisitions, stabilization of our Lakeland Park development and same center NOI growth of 2.2% for the quarter. Year-to-date, same center is 2.5% and we still expect to meet our guidance range of 2.5% to 3% for full year 2015. Our results this quarter were helped by higher than expected expense recoveries and increase in other income and a significant reduction in bad debt year-over-year. Results were somewhat negatively impacted by lower occupancy both inside and outside the same Center pool, caused largely by our desire to activate reposition the portfolio. The other income increased and better collections are the results of our move to higher quality portfolio over the last few years as well as an increased financially oriented operating focus got on by the reorganization of center operations that I announced last quarter. Over the next few quarters we should also expect to see the benefits of this reorganization in our leasing metrics, expense control and value creation items. We continue to see good demand for our space as reflected by a consistent number of lease transactions and comparable rollover spreads of 9.3%, our highest reported level since we began transforming the portfolio five years ago. In addition to the strong rollover spread, the lease transactions have already started to reflect our strategy of upgraded tenant quality, combined with smart lease terms. These include strong annual rent increases during the term with fewer tenant renewal option giving us better control of our real estate. Tenant demand has also helped by many anchor upgrades that Dennis mentioned. For instance, at three of our shopping centers 100 Hunter Square, West Oaks and Mission Bay we have produced six anchor upgrades, which are expect to generate additional sales of nearly $30 million of what previous tenants do. As a result of these new demand generator there are 43 additional tenants totaling 175,000 square feet expiring at these properties from now until the end of 2019. On these spaces we are forecasting new and renewal rollover increases averaging 12%, which demonstrates the added benefit to our reanchoring activities. Also with our focus now almost entirely on our wholly owned shopping center portfolio, we would expect greater efficiencies in leasing, which should drive both occupancy and rent at our wholly owned properties. Our overall lease occupancy at the end of the quarter is 94.3%. Smaller shop occupancy is 86.5%, which is essentially unchanged from last quarter on a comparable basis. Anchor occupancy is 97.6%, which is 1% lower than last quarter. This 113,000 square foot increase in anchor vacancy was largely driven by our active remerchandising of two office supply stores, as we continue to lower our disclosure in this category. And our purchase of a vacant 51,000 square foot former grocery box at our Spring Meadows property, which we expect to retenant with two national anchors. We are in the active negotiations from both of these vacant anchor space, but it should be noted that we are forecasting the NOI benefits of the leasing and the 77,000 square feet of currently leased, but not yet occupied anchored space to occur mostly in 2016. Our current pipeline of lease deal suggest that before the end of 2015, consolidated leased occupancy will be approximately 95%. Again, this NOI benefit for the increased lease occupancy will not be reflected until part of 2016 and into 2017. Our near-term leasing goals are to drive small shop occupancy 100 to 200 basis points by the end of 2016. While still maintaining tenants and lease term quality. Regarding our value-add pipeline, we added $14 million of projects to our list. Including the leased up of the Spring Meadows grocery box. The re-positioning of our out parcel at the shop at Lakeland and the replacement of Best Buy with container store at West Oak. We also placed in service the $5.4 million Parkway Shops Phase II in Jacksonville Florida. Our total active projects we are currently implementing is now $80.9 million, which we expect to stabilize over the next six quarters. Including $14 million of projects that will be finalize in 2015. We are committed to maintaining an active value creation pipeline of at least $65 million to $75 million near-term and we work add value even at properties that may not be long-term holds for the company. As I noted last quarter about half of our properties has some form of value creation opportunity and with our current operating structure I am certain we will certainly get active on most projects while smartly managing any impact to earning during the redevelopment. Our projected annual development volumes does not yet include the larger potential projects Dennis mentioned. At Deerfield Towne Center, Front Range Village and Woodbury Lakes for which we are continuing to master plan. We believe that we can create a special place at each of these three properties that will drive long-term value through increased density for many years to come. So with these inherent value creation opportunities, the portfolio’s increasing tenant and property qualities and my commitment to judging success on solid execution. I’m confident about our ability to generate strong internal growth in the mid-term. With that I'd like to turn the call back over to Dennis for final remark.

Thank you, John. I want to take this opportunity to reemphasize the focus of our future business plans. They include further migrating our wholly-owned multi anchored shopping center portfolio into the best submarkets in the central United States, where we will be the dominant retail destination in our trade areas. This philosophy will direct our dispositions as we sell assets that are not consistent with this property type or do not present the opportunity to add significant value. Focusing on the ownership of these types of shopping centers will allow us to drive net asset value through the acceleration of the number and size of value add opportunities we can pursue as these centers lend themselves to densification of retail uses. The opportunities in our shopping center portfolio to grow shareholder value are numerous and we have the right team in place to take advantage of these opportunities. I’d now like to turn the call back to the operator for questions. Jamie?

Thank you. We will now be conducting a question-and-answer session. [Operator Instructions] And our first question today comes from Todd Thomas from KeyBanc Capital Markets. Please go ahead, with your question.

Hi, thanks. Good morning. First question just regarding the guidance revision, I appreciate the bridge to the $1.37 to $1.39 range with the G&A and other one-time items. But the move from $1.28 to $1.32 to the $1.32 to $1.33, what specifically contributed to that increase?

First of all, hi Todd. Other income at our properties, higher recoveries especially in our recent acquisitions significantly lower bad debt accruals and so basically those were the elements that accounted for the.... as the second quarter we were still giving a conservative range, although we thought we would be at the higher end of that range. We certainly believe that all of our information was trending that way, but we waited until this quarter really not only to tighten up the range but to demonstrate our confidence that we will come in at the high end of the range for the year.

Okay. And then Dennis you mentioned some of the G&A savings are related to a proactive hold on hiring, can you just shade some light on that comment what cause that decision? And specifically, where in the business are you postponing hiring?

Well, basically what happened is there were a number of departures throughout the first and second quarter of individuals that for a variety of reasons left the organization. Typically we would immediately turn around and refill those positions. But as we took a look at a somewhat smaller portfolio because of the number of sales that we had and as well as the reorganization, we just wanted to really let things settle down and really appreciate where we needed to talent and then move on that. But as I said, as we get back to a normalized G&A number it really will come in or would it come in at the guidance that we gave on G&A earlier.

Okay. And then regarding the dispositions, you talked about having some properties under contract $43 million; I think you said there is about a 7% cap rate. Are they expected to close in 2015 or are those sales part of the bucket that will take place in the next 18 months? And then I guess it sounds like there is additional sales on the table beyond that $43 million that you just -- that you talked about. I guess I’m just curious as you look at the portfolio today, how much of the portfolio is not consistent with the long-term strategy of the company today?

Well let me say this, relative to the $43 million, if we could close all of those dispositions, we would and thought we’d like to. What has happened is many of the perspective buyer pools and again they aren’t only contracts somewhere in letters of intent has migrated from institutional buyers and private lease that had a little more difficulty raising capital to more exclusively of the private buyers who lead to line up their financing et cetera. So we will close the $43 million just as quickly as we can. We believe we’re on top of those and we’re dedicating enough energy to get them closed before the end of the year. But again it will depend upon the timing vis-à-vis our buyers being able to tie everything and get ready to close. As far as additional dispositions are concerned, we have typically talked about selling somewhere between 5% and 7% of the portfolio on an annual basis, what’s important to understand as far as future dispositions are concerned, although we are not at this moment giving any guidance as to a dollar amount. Our dispositions for 2016 will be times so that they will occur approximately when we need the capital for the capital improvements that we’re doing at the later part of ‘15 and well into 2016.

Okay, great thank you.

Our next question comes from Vincent Chao from Deutsche Bank. Please go ahead with your question.

Hey, good morning everyone. Just want to go back to G&A for a second. So I think what I heard you guys say is that could cause you to then go back to normalized [indiscernible]. The intent here is not, you’re not looking for G&A savings specifically it’s more just trying to reallocate those dollars to the best use, is that right?

Yeah, I’d say basically that’s correct.

Okay. And then on the 2.5% to 3% guidance year-to-date to 5%, just curious how much of that so implied uplift in the fourth quarter is embedded sort of leases that are signed or just waiting to commence as oppose to something you need to go out and go get I guess?

There isn’t anything that we’ll have to go out and get sorry but it’s John Hendrickson. So it’s all embedded in work over now keep in mind we will be adding our core acquisition properties to the pool next quarter, so the pool will change slightly.

Okay. And will that have any meaningful impact on same store?

No, I don’t think so.

Okay. And then just maybe another question on the capital deployment side. So there’s $65 million to $75 million run rate, asset sale about 5% to 7% of the portfolio ongoing, which I think is kind of in that 100 millionish area. So pretty much funding the redevelopments or maybe plus a little bit so that seems like it kind of takes care of itself, just curious how you’re feeling about sort of the acquisition markets today given your own cost of capital, given the current market conditions and obviously got to digest what you just recently announced, but just curious how you’re feeling about the acquisition market and the opportunities there?

Sure, okay. We continue to keep our feet in the water relative to acquisitions. We want to make sure that the both brokers and the owners who are representing centers in those markets that we really like, know that we’re still active players. However, I’d like to think that we’re smart allocators of capital and to the extent that cap rates really haven’t moved very much. It’s still very expensive to buy anything out there. And so we at least for the time being will remain focused on our redevelopments.

Okay. And then on that front cap rates haven’t moved yet, I mean would you consider ramping up the 5% to 7% of the portfolio in say 2016 just to capture some of that value or unless you have that redevelopment in line of sight you wouldn’t necessarily accelerate that, how do you think of that?

Accelerate the activity?

Dispositions.

So you are talking about cap rates. I think that as opportunities arise both in our portfolio and if for some reason we saw something that was very compelling for one reason or another then we absolutely could ramp up the disposition program especially because a number of the assets that we would consider selling pursuant to our strategic direction are very desirable assets in the marketplace. So I think that the timing of dispositions as we have migrated more and more to assets in good markets we’re able to sell those -- we will be able to sell those quicker. And so we’re going to stay very focused on redevelopments and as the environment for acquisitions increases then we obviously have the ability to sell certain quality assets that we believe are fully valued and just are not going to fit in our philosophy going forward. I hope that answers your question.

Yeah, thank you. And then just last question, just I didn’t kind of understood, but did you give the bad debt expense for the quarter?

Bad debt for the quarter?

Yeah, in the quarter, do you have that?

It is approximately $200,000.

$200,000. Okay, thank you.

Our next question comes from Lina Rudashevski from JP Morgan. Please go ahead, with your question.

Hi, thank you. You mentioned in your comments that you’re decreasing your exposure to office size retailers, I was wondering if there are other retailer categories that you would ideally like to decrease your exposure to or increase.

I think a specific category, no I mean obviously we constantly review the portfolio, but our largest the whole merger with Staples and Office [ph] that we’re focused on and just the long-term viability. I don’t know while we’re trying to move the portfolio to best in class retailer. So that’s why -- that's really our focus. So as we mentioned we are adding Container Store to our property here in Michigan. And those and we’ve done now [indiscernible], Nordstrom Rack deal. Those are type of retailer that we can just expect to continue to do business with.

Okay. So there isn’t a category of retailer that you had any preference?

No, I don't think so.

So I would just add to John’s comments. We certainly watch the financial health of retailers where we have real exposure in the portfolio. We are bullish about the whole omni-channeling and the retailers who get it. And we obviously watch for anybody who may faultier because they’re not participating in omni-channeling. But we haven’t been the kind of organization that talked about going through the portfolio and looking for certain segments that might be exposed because of internet sale. So we watch all of our tenant categories and I guess if there is anything that we say that we would be focused on is in addition to just watching everybody is constantly upgrading our brokers, but our last purchased Front Range Village include a specialty grosser and the number of specialty grosser in our portfolio have been growing.

Okay, thank you.

Our next question comes from Collin Mings from Raymond James and Associates. Please go ahead, with your question.

Hey, good morning Dennis, good morning, John.

Good morning, Collin.

First question from me, just going back to the redevelopment pipeline again in the comments as far as opportunities on about 50% of the portfolio, can you maybe just talk a little bit more about how you are prioritizing projects? Is it just simply based on return or just talk a little bit more about how [indiscernible] you build out that pipeline how you’re prioritizing the projects?

Sure, Collin this is John Hendrickson. The reality is our focus is on opportunities that we have that we can execute near-term, and while we continue to plan the longer-term vision. So from prioritization it’s really just where can we get after it today and -- but we’ve never allowed our pipeline of segments so that we can maintain a near-term volume, one that we can execute efficiently and also that we can schedule from a managing the impact -- any negative impact from an earning standpoint. So I guess hope that answers the question.

Okay. I mean I guess is there any consistent theme I think that you are focused on in particular as you look through the pipeline of opportunities?

No I mean most of it is where there is truly adding GLA opportunely [ph] then a second theme would be where you can upgrade tenancy, but the primary thing is just added GLA.

Okay. And then maybe you guys could touch a little bit more on the comments as far as looking to add some density to three assets in particular. Can you maybe update us on your loss there? What’s driving that and then how far down the path are you on those plans?

Well we’re actively working on the master planning process, a process that we think which should be in good shape to maybe in the first quarter of next year ramp up the master planning and start from entitlement standpoint. I mean our thinking is that those properties that I’ve mentioned Front Range, Woodbury and Deerfield properties are assets that are large and have great raw material to create one -- first, create a special place based on the retail and through that might add possibly the other uses, but more importantly just the ability to drive rent from a retail standpoint.

I would add Collin that -- and we’ve discussed this with you that on the larger format centers, as the parking ratios have come down from 5.5 down to 4.0 there is a significant amount of opportunity when you own 35, 50, 60 acre sites to really add a lot more retail space and the anchors appreciate that they don’t need those kinds parking ratios any longer. So they’re cooperative albeit that typically you have to go back to them to get their approvals to increase density. But that’s really a very significant opportunity for us and really the primary direction in which we’re in.

Okay, that’s helpful guys. Just going back to couple of specific from the quarter, just anything specific on the -- that drove the better expense recoveries in the quarter or is that just kind of just better execution on guys part or was there something else that drove that?

No I mean largely it was actually it is a recalculation of being able to better understand exactly how it will end up. Because keep in mind you don’t do true up until next year so you’re really estimating right now. And so to better understanding that that largely a big chunk of that was outside of the same-center pool and our new acquisition as we digested those.

Okay. That’s helpful. And then going back to a couple of the other questions in earlier, but just again it sounds like there is some reacceleration kind a same store growth going into the fourth quarter. How much of that is kind of core or as John you mentioned a minute ago I think that the same store pool is changing a little bit in the fourth quarter, can you just talk a little bit more about what’s going to be driving that lift?

Yeah, really the -- it’s a big on some write starts in fourth quarter, but also the -- I mean I don’t think that the acquisitions themselves are driving it higher. And I think that probably in line with the two pieces are in line for the fourth quarter. So it’s really just occupancy start. And all stuff is already baked into our numbers right now.

Okay. So this occupancy in better higher range from better spreads.

Right.

Okay alright. Helpful guys, thanks and good luck during the quarter.

Thank you.

[Operator Instructions]. Our next question comes from Craig Schmidt from Bank of America. Please go ahead, with your question.

Thank you, good morning. I was wondering if you can comment yeah -- I was wondering if you could comment on the plans for the $28 million in land available for development and the $12 million land available for sale?

Well. The most significant element in the land available for development involves the property we have in Heartland, Michigan. And we are working now with several users for not in insignificant percentage of that property and we’d like to think that we might be able to announce something sometime in the fourth quarter that we have completed an understanding with at least one specific tenant. As far as the land available for sale is concerned, obviously the timing on some of those parcels are a little bit harder to give you real timing on. Although we did a pretty good job of selling off land that was not income producing in 2015. It will be a significant focus of ours going forward that if we’re not going to be able to use raw land than we do one sell it at the most advantageous time at the best prices, but just to get it off our books for sure.

And Craig just to clarify one thing on the Heartland transaction that Dennis has mentioned. As the transaction we’re working on right now is actually went up being a sale. So it won’t be -- you won’t see that on our development schedule the next phase. We expect that will generate demand for other development opportunities, but this initial phase you won’t see it.

Okay, thank you. That’s helpful.

[Operator Instructions]. Our next question comes from Chris Lucas from Capital One Securities.

Good morning, everyone. Just a quick question here on the sort of tenants held, has your watch list extended or shrunk say over the last six to nine months? And then maybe if you could provide some color on how late pays have trended over same time frame?

Hi, Chris. No, I don’t think it’s unchanged I would say from a watch list standpoint and also from a late pay standpoint. I don’t think we’ve seen any significant change plus or minus over the last six to nine months, it seems very stable. And in fact we’ve been able to get after and I think better focus we can actually get after that [indiscernible] lower bad debt expenses, we are getting after things quicker. In addition to the fact that we a have better quality portfolio.

Could you John provide a little more color on when you say get after it quicker, what specifically are you talking about?

That’s fair. I’m not talking about just being able to have right focus so that you can resolve disputes quicker, both from either late payer or people doing counter [ph] disputes and so forth. Being able to get the right focus from a right level of person and get resolved things quicker. And our reorganization has allowed us to do that supply. But higher quality team really focused on a smaller level properties and get after it quicker.

Okay. And then just a more general question, are you guys seeing any change in the decision making by tenants in terms of deciding to sign a lease or not is there anymore... is there any change to that?

It continues to be I think harder as always has been. But I mean, no, I don’t think so. Tends to manage still good and they are still making I mean, they are being cheerful in their decision making process. But what has helped for sure from our standpoint it is that as you get new quality... as the quality of our portfolio, but also the quality of our acre tenancy has really helped drive that and you have multiple people chasing the same space.

Okay, great. Thanks so much, guys. Appreciate it.

Ladies and gentlemen at this time we have no further question. I’d like to turn the floor back over to management for any closing comments.

As always, ladies and gentlemen thank you very much for your time and attention. We look forward to a great quarter, the fourth quarter and we’ll talk to you after the first of the year. Have a good day.

Ladies and gentlemen, this does conclude today teleconference. You may now disconnect your line at this time. We thank you for your participation.