Rush Enterprises, Inc. (RUSHA) Q4 2017 Earnings Report, Transcript and Summary

Good day, ladies and gentlemen and welcome to the Rush Enterprises, Inc. Fourth Quarter and Year End 2017 Earning Results Call. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session and instructions to how to participate will follow at that time. [Operator Instructions] As a reminder, this conference is being recorded. I'd now like to introduce your host for today's conference, Mr. Rusty Rush, Chairman, CEO and President. Sir, you may begin.

Good morning, everyone and welcome to our fourth quarter and year end 2017 earnings release conference call. On the call today are Mike McRoberts, Chief Operating Officer; Steve Keller, Chief Financial Officer; Derrek Weaver, Executive Vice President; Jay Hazelwood, Vice President and Controller; and Michael Goldstone, Vice President, General Counsel and Corporate Secretary. Now, Steve will say a few words regarding forward-looking statements.

Certain statements we will make today are considered forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. Because these statements include risk and uncertainties, our actual results may differ materially from those expressed or implied by such forward-looking statements. Important factors that could cause actual results to differ materially from those expressed or implied by such forward-looking statements include, but are not limited to those discussed in our annual report on Form 10-K for the year ended December 31, 2016 and in our other filings with the Securities and Exchange Commission.

As indicated in our earnings release, we achieved annual revenues $4.7 billion and net income of $172 million, or $4.20 per diluted share. In the fourth quarter, net income was $105.7 million or $2.54 per diluted share, on gross revenues of $1.2 billion. Annual and quarterly pretax income was reduced by $7.2 million, as a result of a one-time bonus provided to all employees. Also, as a result of the tax form legislation - reform legislation, the Company's annual and fourth quarter tax expense decreased by $82.9 million. This was primarily due to the revaluation of the Company's deferred tax liabilities at the new corporate federal income tax rate of 21%. Excluding these two events, the Company's annual and fourth quarter diluted earnings per share would have been $2.28 or $0.66 respectively. I'm very proud of our team for the company's excellent financial performance in 2017, particularly our record high net income. Our strategic initiatives began to take hold and gain momentum in the second half of the year, positively impacting our financial results. Our performance was also driven by overall economic growth and strength throughout most market segments and nationwide. In the aftermarket, our annual parts and service and body shop revenues were $1.5 billion and our annual absorption rate was 121%, a record high. Our aftermarket revenues increased by 16.4% in the fourth quarter of this year compared to the same quarter in 2016. Approximately half of that growth is attributable to broad based strength in the overall commercial vehicle market, 15% is attributable to increased activity in the energy sector and 35% is directly attributable to revenues from our aftermarket initiatives. This aftermarket growth combined with expense management also helped us achieve our fourth quarter absorption rate of 128%, another record high. We expect this strength across market segments and incremental growth in parts and service and [indiscernible] we expect market activity - aftermarket activity to remain strong in 2018. Turning to truck sales. In 2017 we sold 13,000 and 83 new Class 8 trucks, up 21% over the previous year and accounting for 6.6% of the total Class 8 U.S. market. This resulted primarily from an overall healthy economy and growth in construction, refuse, energy and general freight. Used truck values are for the most part stable, while we will continue to monitor the growing supply of used trucks entering the market, we believe our used truck inventory is positioned appropriately. ACT Research currently forecasts U.S. Class 8 retail sales to be 247,000 units in 2018. We believe this growth was driven by general economic optimism and activity in the market indicated by record high order intake in January. We expect Class 8 new truck sales will remain solid in 2018, though our market share may normalize in 2018 to more historical levels. In medium duty, our Class 4-7 news truck sales reached 10,952 units, essentially flat to 2016 and accounted for 4.5% of the US market. Our medium duty sales performance was solid this year, due our ability to meet customer's needs with our nationwide inventory at work rate medium duty trucks. ACT forecasts U. S. Class 4-7 retails sales to be 244,750 units this year, up 1% from 2017. We expect the medium-duty market to have another strong year in 2018. We believe our Class 4-7 results will continue to be solid as we look at the year ahead. Even factoring in the onetime bonus paid to employees in 2017, we expect general and administrative returns expenses to be sequentially higher in the first quarter of 2018 due to normal seasonal increases in employee benefits and payroll taxes. We estimate that the recently passed tax reform will result in an effective tax rate of approximately 25% during 2018 compared to our historical rate of 38% to 39%. Looking ahead, we plan to use some of this tax benefit to accelerate investments in our strategic initiatives, which will result in increased SG&A expenses throughout 2018. As always, I commend all our employees for their dedication to our company, without their hard work and commitment to our customers, we would not be able to achieve such positive financial results as we did in 2017. With that, I'll take your questions.

[Operator Instructions] Our first question comes from Jamie Cook from Credit Suisse. Your line is now open.

Hi. Good morning. Nice quarter. A couple of questions, one on the industry, then to Rusty with regards to your business model specifically, you know, the order growth for truck orders in January were obviously quite stronger versus expectations. Can you talk to me about the conversations you're having with customers on the sustainability of orders and how much of this is driven by bonus depreciation or tax and sort of how concerned you are as 2018 surprises on the upside that takes away from '19? And then you know, for 2018 specifically, can you give us just a little more color on what we should expect in terms of the parking service revenue growth and where you are sort of versus your longer term goals. Because obviously that's been contributing nicely to the profitability? Thanks.

Sure. You bet, Jamie. Well, as far as your [indiscernible] obviously January I think has a record, it was a near record low, second largest in history, right. As I look at it, it was driven a lot by a lot of large fleets, a lot of your public fleets, large public carriers purchased, a lot of leasing companies purchased here in January, so big order intake in certain levels. We typically you know, our business is more broad-based you know, we're not just tied to the big large fleets. I think that's what the strength in 2017 showed up where we were like 21% there in the market because it was great - you know, it was broad based. That's why I said, our market share might be up a little bit in 2018 because we're going to have a lot - I think it's going to be lot more over the road growth than there was last year, because those customers obviously you know, I don't have - sorry about to competitors reports. You know, everybody's rates have gone up quite nicely. So I would expect the over the road business to pick up. But concurrently I expect the vocational business to remain strong. It probably won't have as big a pick up percentage wise, as the over the road business will, but it's still going to be strong. It had its big pickup last year which is why we picked up a lot of market share. But you know, the road business wasn't strong last year, do you follow what I'm saying. So while we do over the road business obviously lots, when it bounces like that we tend to maybe get a little less percentage [ph] of the market, but don't read into that that we're not going to get our fair share of broad based across where it is. As far as taking away from '19, you know, I think it's a little too early for me to say that. I mean, it has climbed dramatically when you look from where we were four or five months ago. I think ACTs forecast were you know, somewhere around a year from '17 to '18 and now we're up about 25% about 50,000 units roughly. And so obviously there is that concern that it could take away from them. But you know, we got to let it play out and see if it will maintain that pace throughout the year. But I don't hear maintaining the paces ahead in January by any stretch. But you know, I don't see it - you know activity from our perspective is still strong. We - I looked at our backlog, when I look at ours, our backlog is up, where compare year-over-year yearend our backlog is up probably about 20%, 20%, 25%. Now that being said, our backlog tends to peak inside Rush not till the summer time. So we are - you know, a lot of the business that we booked is going on right now which will dictate where we're at. As we all know a whole lot more when I get to April and May is to what our whole year personally looks like, because we've got quite a bit of activity going on at this moment. And so we're - you know, I expect especially on some on these vocational and some of these other - these other markets, not just the over the road business. As far as the parts and service business, I really couldn't be beat the heart beat - I guess, I could be more pleased. You could always be more pleased and it would be a fair statement, but am I pleased yes, as to where we're at. I think you know, I was - I came about two years ago and I started talking about our strategic initiatives, as I said more than once, you know, I got to get over our skis, get over my skis here in 2016 and early '17 you know, getting the results, the kind of investment it takes to get these results because of some focused initiatives that I probably won't get into the exact focus statistics on the call. But it is very clear and obvious to me that these initiatives are paying off. You know as I said last quarter coming our Q3, I thought that some of the strategic initiatives will - we narrowed it down and these are - I am going to say approximate, but I'm very solid, I'm pretty solid with the numbers, because sometimes it's not an exact science, but I'm solid that we have about 25% of our growth, as I went to Q3 if I remember right was based upon our strategic initiatives, a lot more in the energy sector and on the overall broad sector. Now in Q4 when we looked into the results it was - energy was only 15% of the growth. Yet we had huge growth year-over-year 16% was just outstanding. I can't remember a quarter like that in a while, on a year-over-year basis. But the great part was we had 35% that was directly attributable to the initiatives that we've undertaken over the last two years inside a five year plan which is really probably - you know, we've got some goodwill goal stretch out to 2022 that we'll communicate obviously in the conferences and stuff and do. So I feel good about that. I would tell you typically you go through the winner, and you know, I've always said before back that February - get rid of November, December, January and February sometimes I would love the holidays, but its stuff on business, less working days and just things tends a little bit slower. We've got a lot of stores in the south. So you know there's no air conditioning work and things like that. But I would tell you this is probably the strongest November through February that I've seen probably in my career in a long time. So I feel real good about it. And spring opens up here and you know, continues to - we move forward in the spring. And you know, we thought a little bit around, I feel very good about where we're at. And as I said you know, the focus of the organization on achieving these initiatives and I think our folks could see that they are doable and they are committed to it and we are definitely focused on that. So I know I didn't give you an exact growth rate, but I would expect to stay you know, I always hedge my back to stay high singles and hopefully we'll be in low double-digit growth rates in the parts and service business. But as I also said and I'm going to accelerate some of the investment inside some of these levers that will be using [indiscernible] still continue to facilitate that topline in that gross profit growth rate, that's what we're looking at. So I mean going to spend a little, as I said in the release, but I think that's what we're supposed to do, I believe, okay. I am not supposed to just hold it, I am supposed to spend a little and grow our parts and service business because obviously that's the key piece of our organization and that's the changes in our company over the last few years, where the revenues truly come from, where the gross profits really will come from. So we're excited about what we've seen and this makes us more excited for the future.

Okay. And sorry, one last question, can you just talk to what you're seeing in the pricing environment on the new truck side? Whether or not we're able to get through price increases in particular to your customers given the - comparing you dynamics…

Yes. As I said that it is competitive out there, you know, you see those big numbers and I know - I don't think you've seen them. I think our margins are going to be going to be difficult with more large fleet business to maintain margins and I - they put revenue out there. I mean, margins still remain - it still remains very competitive, people are still going out for deals right. I don't see any big margin pickup by any stretch from the OEM or you know, at high level either. So I don't - I just don't see that out there right now. I think there's still plenty of capacity out there. Obviously I think someone OEM is further out than there is schedule in their build [ph] schedule, I don't want to get in names here, but anybody threw it out, but it's not - it was not over by any stretch for them, I think we're still six months left in year of their build schedule. So you know, with that kind of backlog to fill up, I don't see you know, I don't see customers are much more savvy and I'm going to allow you know that type of - I don't - I just don't see that happening out there right now. I know it's going to be very difficult for anybody to increase margins, probably this is going to be more of a growth perspective from a revenue perspective to more volume perspective, I don't - with increasing margins will be very difficult.

Okay. Thank you. I'll get back in queue.

You bet. Thanks.

Thank you. And our next question comes from Brad Delco from Stephens. Your line is now open.

Morning, Rusty. Good morning, Steve.

Hello.

Hello, Bradley.

Rusty I'm kind of - from the old history cap on, if I remember correctly, once you kind of get into the high 120s on the absorption ratio, I felt like you used to talk about at that level you're probably turning down business and you need to expand the number of service days. Do you think something has structurally changed with these initiatives that you know, seeing a 128% absorption ratio to be the new norm or how do we think about that. And the other one follow up to that is, how much of this is a function of two of seeing a little bit better performance with some of your more recent acquisitions?

Well. You know, it's interesting you said that. I don't think I could ever say that top and 120 is something is an organization because I never was there, okay. But I get where you're coming from, Brad you know, when you get up in a [indiscernible] stores, individuals stores getting 130s and 140s. Well, but the models have changed you know, the model has changed, right. With the initiatives that we've undertaken not just on the part side, but especially on the service side also, from a mobile perspective, from an embedded technician perspective in customer shops and then you know, and the parts business doesn't require more base, right. So when you're getting growth on a part side is it make sure you get enough warehouse storage and you need to be turning your inventories better and I think you know, the skill sets that we've acquired and the investments we've made on the parts side have allowed us to you know, do a better job of managing our inventory, having the proper inventory, increasing the amount of sales people that we have out in the street, okay. We have increased the amount of salespeople on the street dramatically, okay. And that is helping push more business. I'm going to tell you right now they're not as effective as they're going to be, okay. If I look at the cost of it and I look at what their turning, it's growing every day, okay. So - and our focus on taking it all makes look like whenever all makes parts, not just being the historical dealer, cherry picking off the top of the tree or bottom of the tree. We're trying to you know, trim the whole free. And that's really you know, from a party perspective where we've been. On the service side, we added as I said a lot of technicians, I don't want to talk about how many, but we added a lot of technicians last year over 100, okay, across the network and over 100 and under 500, how is that? But we look to continue that because remember, we don't utilize our base 24/7 with the utilization of our base we have lots of room to grow and understand how to use our shops more effectively. And then you add in the mobile piece, our mobile piece, we continue to expand. We've been doing that stuff for over 15 years. But I remember back in a day when we started it was 80%, 90% was to the oilfield business, right, now that's probably a 35% player. So we broadened that piece to other markets and we continue to broaden and bring it to stores, such bringing it like to the state of Florida where there's no oil or anything going on, but we've got a great focused service group over there and we have other areas I could look at it and tell you, we got the same - the same impacts going on as we push down, you know, the things that we do well, you know, best practice approach, right. It's old saying, you know, to use best practices and move them around. And I'd like to believe that you know we've gotten better and stronger throughout the network. And no question that, as we evolve [ph] in some of those stores to answer your question about new stores that we - I don't what me bought me, bringing in about three years or so, but there was about 2 or 3 we run there, house by bunch of stores at Maxforce [ph] engines, right. I think that's mostly gone. You know it was getting into your culture and pushing again you know, the way you do business. So I think we're seeing increases there. We saw increases in our production rate on both sides of the house, but there's still room to run. Now there is still some headwinds on the Navistar side in the lower market share, but they're gaining market share back and we're not using that as an excuse inside of our company, okay. We're going out and attacking other business I can work on a lot of - there's a lot of things I work on, I don't have [indiscernible] name, brand inside of the building. So we have brought - you know our culture of doing that and continue to build that inside on the Navistar side, but there's still - there's a pretty good gap from an unforeseen perspective between each division. So to me you know, if you look at it two different ways, to me that's opportunity, right. If I've got about 16 to 17 point difference between the stores, and then that tells me maybe I don't get all of it, but what if I get half of that gap back on the other side of house. That means everything, right. And you know I would have to believe going forward that wherever the market is the Navistar piece of our business should continue to grow. I don't care if the market in '19 goes down 20 or its 250 and it goes back to 200, I expect our Navistar business to continue to grow and become a bigger piece of our company as we go forward. Just given the fact that we've had the - you know we continue to as you said earlier get those stores into our way of doing business and they continue to grow and hopefully flourish and they are doing better and we look forward to doing a lot better as we go forward. But don't discuss back that we do a very nice job on the other side of the house to and they all are medium duty brands which are scattered throughout both sides, right.

That was good color. Thanks. And then maybe just one follow up, I don't know if you were sort of alluding to something, but in terms of the investments you're making this year and clearly the fact that we saw some of the success of that with the 60 plus percent parts and service growth in the fourth quarter, you're still sticking by the, call it $7 billion of revenue by 2022 and 5% pre-tax margin?

I'm sticking to it, but to do that I'm going to - as I said, we are seeing successes I guess, Brad, in what we're doing and I'm not going to get into the individual initiatives, this was proprietary to me, okay, I'm sorry. I'm not out to tell everybody what we're doing. But I do - the numbers will speak for how's that, but I am going to accelerate some of those investments because there are a lot of things still in front of us. This is a dynamic - it is not [indiscernible] and drug business, it's pretty dynamic right now with everything going on. I think that we have to continue to invest and invest faster, smarter and do what needs to be done to - because I'm sure you know, competition is always out there and gets cleaner every day also and everybody gets to see what I do. I'm the only father truck guy out there, especially what everyone else does. So you know, we're going to continue invest. We've got a lot of - the initiatives that we have invest in are paying off and we're going to invest more now in some other initiatives that we count on the drawing board. So I just maybe accelerate some of them up, I think that's what the plan was with this you know, cutting of the corporate tax rate, you know, wants us to hoard it on, I'm not going to spend it all. I mean, I am going to accelerate some investments. When you're seeing results and you can get double-digit growth, I mean, it only makes sense to me when you can see that you're getting traction and not just traction but getting numbers. You know, we need to do what's right and if we can get there quicker, how is that?

Yeah. And then real quickly Steve, can you just give us a breakdown on gross margins by heavy duty, medium duty, light duty used?

For the quarter heavy was 7.2, medium 6.5, light 5.1 and used 10.1.

All right. Thanks, guys. I'll jump back in queue.

You bet.

Thank you. And our next question comes from Neil Frohnapple with Buckingham Research. Your line is now open.

Hi. Good morning, gentlemen. Congrats on a great quarter.

Thank you.

Rusty just a follow up on the plans to accelerate the investment here and in 2018, can you say how much incremental G&A expense this will be for 2018 than you've previously planned before the passage of the tax legislation, just so we can make sure we're accounting for that appropriately in the models?

Well, let me see, it depends - that's going to be difficult right here at this time. I mean, I can pick projects, but as we get it growth, remember as I've always said when we grow our parts and service business, I spend money just naturally, okay. There's a natural spend of growth probably. You just don't - it's not the business start rankings they been the other parts, someone has to pick them up, someone has to deliver them, someone has to sell them. It's not - there's a lot of - there's a lot of manpower that goes into it. Now from an investment on the back side, there's a lot of IT and strategic stuff that I'm spending money on, technology stuff. I could probably define that better. I really don't have it on the top of my head right now for you. I just know we're going - we're still going to grow, okay. I'm going to grow the net income level, just giving you exactly what that is right now would be difficult for me because we're really sort of just working our way through it. Q1 is always going to be you know, think about Q1, Q1 is always going to have accelerate expenses just because of comp cost, taxes, everything in that not federal taxes, but just real estate tax, property taxes, all that kind of stuff to go in to play and you know benefits, employee benefits, and we may start paying all the taxes and everything, again, people who had capped out. Q1 and then [indiscernible] benefit cost from you know, stock options and things like, accelerate in Q1. That happens every year. I think you could look back historically at us and that always happen. For me to define exactly what the acceleration rate of investment is, at this moment I'll try to do a better job for you on the next call, I think I'll have a better handle on it. But I'm - we're in the process of sorting that all out as we speak, okay. You know, we just got - we just knew when it was the December 21st or where it was - that we were - we were going to have the benefit of this tax. So we spent the last 45 days looking at all the things we had laid out for us over the next three years. So from an investment perspective the NIM played out pretty tight and we're just honing that up and I'll try to give you a better number of what that looks like on the next call, okay, exactly. But you know Q1 expenses are always up, Q1 is typically on a normal year is going to be our top this quarter and we typically grow from there, okay. And were here, I think you could pretty much a seasonal pattern inside of our business that eats up expenses, increase a lot in 1Q and normal expense in a normal year and then we tend to accelerate revenues and gross profits you know, as we go forward. But I will say that's been pretty solid so far in the winter time as well, I can't wait to get to March, April and May, if we can accelerate a lot when you start working on air conditioners and things like that, again, our shops in the south, you don't much to that workers, some of the things that we do in those are quite pretty happy about where we've been from a revenue and a gross profit perspective on the parts and service side to the fall, winter months the way I look at it. So I'll give you a better number on the investment and exactly what it is, I just don't - we're sorting out all out, I would say right now, so. Okay?

Okay. That's helpful. Thanks. And then Rusty you talked about your classic market share for this year. Any outlook or granularity you can provide an outlook for median [ph] new share…

Sure. I don't think - you got to remember, we went from 5, 5 to 6, 6 we beat the market by 21%. I don't look for us to be 6, 6 this year. There's just too much large over the road fleet business. That being said, we were to numerator and denominator, my vocational business looks to it. I got no - from a construction perspective and refuse perspective it looks good. Now, oil and gas I don't know. We got oil and gas activities really nice on the parts and service side. I don't know how - you know I don't know if we'll be able to do the same in the CapEx side, on the truck side as we did last year. But that's still to be seen, it's only February the 15, we just thing its Valentine's. And so you know, I would look at somewhere in the high 5 to 6 maybe, I don't see a 6, 6 again boards, just because of the other growth numbers are going to from 197 to 250 or whatever, right. And it's going to be really played inside of some big carriers and big leasing companies that we typically don't participate as much. We have we have bigger over the road customers, but not as many is what I think you're going to see a lot of the growth. But the same time, I guess, the vocational business is going backwards because that's what made - that's why some OEMs had really strong years last year that participate heavily, like you know the Pacar side did, because they're big in the vocational piece, like construction and oil and gas and all the other pieces, the refuse and things like that. But it's going to be good. It's going to be just as good I think as it was last year, I just don't know where oil and gas is out, but from our perspective I don't see a 6, 6 in-force, but you have a higher big top number, so I'm not saying we're going to have less seller, so anything like that. I'm just saying I'm not sure how much we're going to participate in that big uptick and those large - and big carriers largely leasing acquisitions.

Okay. That's helpful. But for the medium duty business though, I mean, would you expect…

We expect medium duty business to remain strong, the activity levels are extremely high right now. You know, our Vice President in charge [ph] of medium duty was planning yesterday, was too busy. Now he was actually excited, because the activity level remains extremely strong. So it's little early for me to project it will be bigger, but I don't anticipate us delivering less medium duty trucks. It's still too early in the year to be saying, hey can we top that by 20%. I don't know that, but we've got lots of activity going on. As the year unfolds, have a lot better view of where we're at as we get further into. But I don't anticipate going backwards by any stretch.

Okay. Thanks very much. I'll pass it on.

You bet.

Thank you. And our last question in the queue is from Joel Tiss from BMO. Your line is now open.

Hey, guys. How is it going?

Joe, how are you today?

Wonderful. Beautiful rainy day in New York. Can you talk a little bit about acquisitions now that you don't have to pay taxes anymore? And also is there anything that you can do to be prepared or a little more prepared for the potential for Volkswagen and Navistar to become the same company?

I can do to prepare. I'm prepared. I mean, I am so as more excited than they were all, okay. You know, we feel very good about where they're at and I don't know when - I'm not privy to you know, and Troy and Volkswagen guys get all of you know, the call together and how that unfolds, that's their business. But I do know that they're working closely and you can see it across the board, I think in their results. I don't know, I'm not here to talk about you know, where they - where, when and where and how much you know - how that goes. That's their business. But as for the acquisition side, because you don't pay any taxes is that right Joe, were you in New York?

[indiscernible]

So but, the acquisitions, I don't have any large rules right now. You know, there's a series I'd like to do some stuff, but right now because the markets are good people are enjoying being truck dealers, okay. And it's typically you know, everybody you know, Navistar piece probably maybe couple years ago before the Volkswagen, maybe I should have bought more, but at the time I was - really as I bought a lot when I was [indiscernible] and Navistar got through the tough part of renewing it, I thought I bought enough when they were down, everybody was worried that they were going away and I wasn't going to be Rusty's poly, unfortunately it didn't work out that way. So you know, I still believe that's you know the biggest unpolished, one of the big and one of the largest unpolished diamonds in the company is that division right from a return perspective. So you know, we're prepared. I've built a lot of facilities in the last couple of years I've spent a lot of money on facilities for some of them that we took over. We're really - they were pretty much dogs and so I had not pretty much, dog show had this week at the New York. They would've been in other shows. So we've spent some money and built some new facilities. I think we are prepared for uptick in market share and you know and our Navistar backlog is the best it's been in a few years. So I feel good about that. So there a big…

There isn't anything that needs to be done or sort of proactively would make sense you know, in case maybe Scania or MAN would eventually want to bring their product into the U.S. or to order to look a little further south into Mexico and Brazil to be more of an integral part of whatever the longer term future of Navistar is, it's way too early?

That's a thought. I mean, I needed to see what that's where they really thinking before I go you know, do anything. I worked a few years ago with them and actually it was around with some Navistar folks but nothing ever came out of it. You know, I'm not sure where they're headed. I mean, if they bring product like that to the U.S. then I'm sure that they'll use you know distribution is the key thing when it comes to disperse the product. That's the reason Volkswagen bought Navistar because they needed distribution to get into this country, I have told everybody that's the biggest, you know that's the biggest hurdles anyone coming here is the amount of money, right amount of millions and billions of private capital that these distribution networks that support these distribution networks. But that's what they had to add, you just come over here with trucks and start up when you get the cars because it's a commercial business, you've got to have support to keep it and running. So I'm sure they would use their leverage off of the network that they have. But I have no inkling if that's in the plans, so I'll be honest, Joe.

All right. Well, thank you very much.

You're welcome, Joe.

Thank you. And I'm showing no further questions in the queue at this time.

Okay, with no further questions. I - well, everybody has a wonderful finish to February. We'll get in spring down here shortly and I'll be talking to you in April. Thank you all very much.

Ladies and gentlemen, this does include your program and you may all disconnect. Everyone have a great day.