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Welcome to the Universal Forest Products Incorporated Third Quarter 2018 Conference Call. Hosting the call today are CEO, Matt Missad; and CFO, Mike Cole. Matt and Mike will offer prepared remarks and then the call will be opened up for questions. This conference call is available simultaneously and in its entirety to all interested investors and news media through our webcast at www.ufpi.com. A replay will also be available at that website through November 17, 2018.
Before I turn the call over to Matt Missad, let me remind you that yesterday’s press release and today’s presentation include forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. These statements are subject to risks and uncertainties that could cause actual results to differ materially from the Company’s expectations and projections. These risks and uncertainties include, but are not limited to, those factors identified in the press release and in the filings with the Securities and Exchange Commission.
At this time, I would like to turn the call over to Matt Missad.
Thank you, Shelby, and good morning, everyone. Welcome to our third quarter 2018 investor call. As you know, our challenge this year is to be greater than before, and once again, our operations succeeded, setting quarterly sales and profit records. We have many reasons to feel good about this quarter. Sales reached a record $1.21 billion for the quarter and unit sales were up 7%. Earnings per share were up 20% to $0.66 per share versus 2017.
Our gross profit dollars grew at a faster rate than our unit sales growth, indicating a more value-added product mix. Our installation of automation and technology has accelerated and it is making us more efficient and reducing cost as expected. And we graduated our first class of the degreed program of the USP business school and placed eight of the nine graduates into career-building positions within the UFP family of companies.
We also recognize that while many good things are happening, we have certain areas which need to be corrected. I personally am disappointed that we missed our quarterly operating profit target by $6 million. While we have several operations exceeding their targets, we have many operations which are also falling short. There are variety of reasons why some operations fell short of targets. Among the most common are labor and benefit cost increases, transportation cost increases, rapid lumber market swings, and orders being pushed to future periods.
An example of labor and benefit cost increases include increased overtime due to a lack of sufficient workers to meet production needs and health insurance costs which are well in excess of budget. Transportation costs continue to be high due to a shortage of trucks and drivers during peak delivery times. Rapid lumber market swings, such as a decline of nearly $100 per 1,000 board feet during Q3 for southern yellow pine, have a negative impact on those operations which primarily focus on variable price products. We would hope to offset this with improvements on fixed price products.
And in the construction market, weather and permit delays have pushed out completions and our order files have also continued to be pushed. In the industrial market, project approvals, contractor delays, and changing customer forecasts caused $20 million in projects at IDX to be pushed from the third quarter. Right now we expect that IDX will be able to fulfill total sales of $250 million for 2018. The remaining originally forecasted sales of $40 million will be pushed to 2019.
As a result of the sales push and the increased cost of managing the delays, IDX’s operating profit for the third quarter missed its target by approximately $4 million. We now expect IDX’s EBITDA for the year 2018 to be in the $5 million to $7 million range. In 2019, we will treat IDX like any of our operations and hold them accountable for a return on investment greater than their cost of capital. We also expect that many of our other underperforming facilities will improve their performance by the end of 2018.
I remain optimistic for the future because I know many of the challenges are correctable and within our control. For example, our medical insurance costs resulted in an additional quarterly expense of more than $1.5 million, which has been absorbed entirely by the Company as part of our commitment to use some of our income tax savings for employee compensation and benefits. However, for the new plan year beginning May 1, 2019, we are eliminating our high cost PPO plan and creating more benefit options for our employees with our HSA plans. We expect this will save money both for our employees and for the Company.
And with rail and trucking costs at unexpectedly high levels, our transportation subsidiary has been analyzing several options to streamline our process and costs, which we believe will help reduce the impact of rate increases and better balance the use of internal and dedicated carriers with outside contract carriers. And our investments in technology and automation continue to help us eliminate manual labor and hard-to-fill jobs while still preserving and enhancing growth and career opportunities for our production teams.
We also have solid improvement plans in place for underperforming operations as well as growth opportunities we will continue to capitalize on. Among those growth opportunities are our Deckorators brand. Our Deckorators brand has received new customer commitments for 2019 business, which we expect will be significant double-digit growth. Deckorators just launched its new and improved slip-resistant Voyage line of decking, which has 34% or greater surface traction than typical composite decking brands. This Voyage product was very well received by the attendees at the recent Deck Expo.
And Voyage is just one example of new products which will help our future new product sales effort. Through the third quarter, our total new product sales for 2018 are ahead of budget, totaling $386.7 million. A few other factors I’d like to call your attention to are the lumber market. The lumber market now is now at levels lower than 2017 and we will be focused carefully on supply and demand imbalance and the impacts on our pricing overall.
Our inventory levels are at 137.9% of sales, which is significantly higher than desired at this time of year. Orders being pushed as well as the decline in the market are contributing factors to the higher-than-optimal inventory levels.
On the SG&A line, our SG&A expenses in Q3 were more in line with estimates. We do believe there are additional leverage opportunities to reduce this cost as a percent of units sold. On the international front, our international sourcing efforts have expanded as we continue to seek more sources and better pricing for our raw material supply. In our last quarter call, we mentioned increasing sales of U.S.-manufactured products overseas. That continues. However, some countries like China have imposed new tariffs on our US products, so we will be monitoring the impact of these going forward.
And finally, we remain very active in the acquisition arena and have maintained our focus on acquisitions where we can earn a reasonable rate of return that exceeds our cost of capital. We have closed six acquisitions this year so far, which all are proceeding according to plan. And we continue to be interested in acquisitions which enhance our core capabilities in industrial, which bring new products, processes, or technologies, or which expand our capabilities in adjacent markets like packaging.
Now I’d like to turn it over to Mike Cole, who will provide more details on our financial performance.
Thanks Matt. I will start by reviewing the impact of the recent lumber price trends. Overall lumber prices peaked in June and dropped substantially during the third quarter by about 25%. In spite of this sequential drop, average prices were still up about 14% year-over-year, which increased our costs, selling prices, and investments in working capital compared to last year.
Overall, the sequential drop since June had a favorable impact on our gross profits, which I will expand on in a minute. Walking through the income statement, overall sales for the quarter increased 15%, resulting from a 7% increase in unit sales to go along with the 8% increase in selling prices. Organic growth contributed 8% of our unit sales increase, while acquisitions contributed 2%.
Breaking down our sales by market, sales to the retail market increased $52 million or 13%, resulting from an increase in selling prices of 9% and a unit increase of 4%. We were also pleased to see our new product sales grow to this market since it’s a key strategy to achieve margin improvement. Our new product sales to the retail market increased nearly $15 million or 22% in Q3. Our sales to the industrial market increased 15%, driven by an 8% increase in units and an increase in selling prices of 7%. Acquisitions contributed 5% to unit growth, leading organic unit growth of about 3%. This was lower than the organic unit growth we reported in Q2 and was due to a $7 million decrease in sales reported by IDX.
The remaining 3% organic unit increase was primarily driven by adding 90 new customers, 140 new locations of existing customers, and $7 million of new product sales growth as our efforts to improve market share continue to gain traction.
Our overall sales to the construction market increased 17% due to an 8% organic unit increase, a 1% increase in unit sales due to acquisitions, and an 8% increase in selling prices. Within the construction category, our unit sales increased by 3% to manufactured housing, 11% to residential construction, and 18% to commercial construction customers. Our acquisition of Great Northern Lumber earlier this year contributed to our commercial construction growth.
Moving down the income statement, our third-quarter gross profit increased by $14 million or nearly 10%, surpassing our 7% growth in unit sales as our profit per unit improved. The overall gross profit increase was comprised of increases in our construction market of almost $8 million, and a $9 million improvement in our industrial wood business. This was offset by a $1 million decrease in retail and a $2 million decrease in gross profit of IDX. The overall improvement in our profit per unit on sales to the construction and industrial markets was primarily due to the favorable impact of the falling lumber market on products we sell with fixed selling prices. This was offset somewhat by the impact of the falling lumber market on variable price products like treated lumber and higher labor and transportation costs as a percentage of sales.
Continuing to move down the income statement, SG&A expenses included $14.3 million of accrued bonus expense, up nearly $2 million from last year, resulting from an increase in operating profit. The remaining core SG&A expenses totaled $88 million, down from $90 million last quarter, but $1 million over our internal plan of $87 million. The $1 million increase over plan was primarily due to higher healthcare costs.
Operating profit and EBITDA each increased by 9% for the quarter, surpassing our unit sales growth of 7%. While we are pleased to be able to improve our profit per unit this quarter, we expected better, anticipating, as Matt said, another $6 million in operating profit and EBITDA than we achieved. Finally, our effective tax rate this quarter was almost 24% compared to 32% last year. We still anticipate a rate for the year of about 23.5%.
Moving on to our cash flow statement, our cash flow from operating activities for the year-to-date was $60 million and comprised of net earnings and non-cash expenses totaling $161 million, offset by a $101 million increase in working capital since year-end. As I have mentioned on previous calls, we measure our cash cycle to assess our working capital management. Our cash cycle for the third quarter increased to nearly 51 days compared to 49.5 days last year due to a slight increase in our days supply of inventory.
Investing activities consisted of capital expenditures totaling almost $75 million, including expansionary CapEx of $19 million; proceeds from the sale of real estate including our Medley, Florida, facility in Q1 for over $35 million; and $39 million spent this year to acquire several different companies that primarily serve the industrial wood product space.
Financing activities primarily consisted of $32 million in net repayments on our revolving credit facility and $75 million in senior notes issued under our existing shelf facility. We also repurchased $1.8 million worth of our stock this year at an average price of almost $33 and paid over $11 million of dividends at an annual – semiannual rate of $0.18 a share.
With respect to our balance sheet, our net debt was about $191 million at the end of Q3 compared to $153 million last year, including $27 million on our revolving credit facility. We anticipate that the amount outstanding on our revolver will be paid off during Q4 as we move beyond our peak investment period for working capital and bring inventories in line with internal targets. Overall, our balance sheet remains strong and we believe we could add $300 million in debt to continue to grow our business and still feel comfortable with our leverage and capital structure.
As we have discussed on previous calls, our highest priorities for use of cash continue to be capital expenditures and acquisitions, but we always seek the highest return for investors and will consider share repurchases for the balance of the year. Finally, our trailing 12-month return on invested capital is 14.3%, exceeding our weighted average cost of capital and up from 12.4% last year due to the lower income tax rate.
That’s all I have on financials, Matt.
Thank you, Mike. Now I’d like to open it up for any questions you may have.
[Operator Instructions] And our first question comes from Ketan Mamtora from BMO Capital Markets. Your line is now open.
Good morning, Matt, Mike.
Good morning, Ketan.
Good morning, Ketan.
First question, starting with IDX, and to the extent that you can, can you talk about what is causing these delays? Because we’ve seen that happen in the past and it’s happening again this year. So in your view, what is causing these delays?
I think it’s a wide variety of factors, Ketan, and it’s a very good question. So I think it ranges everything from customers changing the timing on which they want to do their variety of their installations. So many of the orders are multiple location orders, so they may be adjusting their schedules as they go. General contractors are having difficulty getting their permits in and trying to get the approvals necessary to complete the construction. And as you might imagine, IDX is generally one of the last contractors in on a project. So every delay that occurs prior to them getting in tends to push the schedule back. So the orders are still remaining with IDX. It’s really just a timing problem, and it’s tough for them to gauge, given some of the situations that happen on the sites.
Is there anything that you can do to sort of have a better visibility on this? Or it’s not something that can really be done?
Yes. I think it’s very similar to our framing business, which is you have to look at it in longer periods of time. And quite frankly, on a quarterly basis, it’s difficult for them to forecast and – just as it is in the framing business. So we have to take a little longer-term view of it when we are analyzing it. We are going to continue to try to get better visibility and try and know a little sooner when things are going to push. But most general contractors don’t like telling the project owner that they are behind schedule and so they don’t like telling the other subs they are behind schedule either.
Right. And then one question on the margin side. It’s lower than what I was expecting. So, I mean, aside of delays in getting these orders, what do you think is kind of pressuring the margins? Is it sort of the fixed cost absorption issue or is there something else that is going on fundamentally?
So you are looking more overall?
Just IDX.
IDX, I don’t think we put the specific margin out there.
Yes, maybe you picked up on, Ketan – their sales were down $7 million from last year and I mentioned that gross profits were down $2 million from last year. And that’s just a – so that is a fairly high incremental margin and that’s because of the high fixed cost nature of the business.
Got it. And then just turning to your comments in the release and this morning around growth opportunities on the non-wood packaging side of things, can you just talk us – just give us some thoughts on what do you find most interesting? Obviously at a general level, not getting into specifics, but any thoughts there will be helpful.
Sure. So one of the things that we are excited about is the mixed materials, the use of mixed materials in packaging. Not just wood, but maybe a combination of wood and other materials. Our recent acquisitions of companies like Packnet in Minnesota and North American Container earlier this year, which is very heavy in mixed materials, those are good opportunities for us we think to not only expand our customer base, but also to get deeper with our existing customers. So we see that as a very good fit for us.
Got it. And then just one last question before I turn it over. You mentioned your inventories are higher than what you would like for this time of the year. So as you toggle to more fixed price contracts, does that in some ways limit your ability to take advantage of lower lumber prices?
No, it doesn’t. I think obviously we have a very good purchasing group that’s focused on the appropriate time and levels to buy. We also have some transportation things, which is for the last several quarters has caused us to carry a little more inventory; just we obviously don’t want to run our customers out of product. But we still see very good opportunities to buy and take advantage of market swings. As you know, Ketan, we do a wide variety of inventory items across different species and all kinds of sizes. So it makes it – there’s plenty of opportunity for us to take advantage of the market.
Okay, that’s very helpful. Good luck in Q4 and into 2019.
Thank you, Ketan.
Thanks, Ketan.
Thank you. And our next question comes from Reuben Garner from Seaport Global Securities. Your line is now open.
Thanks. Good morning, guys.
Good morning, Ruben.
Good morning, Ruben.
So just want to talk about the gross margin overall. Can you maybe help us? It seems like there’s a lot of moving parts, some one-time items or potential one-time items. Can you help us with maybe a bridge from your gross margin in Q3 last year to what you reported this year so we see kind of try to parse out what happened on a year-over-year basis? And maybe how to think about it moving forward, given all of these different items, whether it’s lumber, labor, transportation, order pushouts and mix shifts. Can you maybe help us on a broader basis?
Sure. The way that we usually try to express this is by talking about our unit sales growth and our gross profit growth. So unit sales growth was 7%, gross profit growth was 10%, so obviously profit per unit improved. Another way to look at it that might align better with what you are asking, though, is if we restated this year’s sales dollars at last year’s lumber market levels. So lumber prices were 14% higher. And because of the pass-through nature of commodity lumber costs, your gross margin percentage is always going to kind of shrink because of higher lumber prices.
So if we do that adjustment and just change this year’s sales dollars to be reflected in last year’s lumber – based on last year’s lumber prices, the gross margin is up over 14%. And so just another way to express that on a margin basis, when – the reason for that increase is because of the favorable impact of sequential trends in lumber prices on fixed price products. So industrial wood and construction, those are the areas with the biggest mix of fixed price products and so those are the areas with the biggest margin improvement. But those improvements were offset by labor and transportation, which together were about 1.5% higher than last year as a percent of sales. So we were able to grow that margin, that adjusted margin, even in spite of that. And then in spite of IDX margins being down as well. Does that make sense?
So just to clarify – had labor and transportation been constant as the percentage of sales and had lumber been constant, you would have been – gross margins would have been over 15%? Is that what you are –?
That’s exactly right.
Okay. Got it. And then – so volume growth was actually I think a little bit stronger than we had and I’d assume others were expecting. Can you talk about – I mean, that was in spite of delays, it sounds like, in a number of different businesses, not just IDX. But it sounds like weather pushed out some other business. Can you just talk about the broader markets, what you are seeing from an end market perspective? And your expectations going forward across your different end markets, especially, I guess, on the housing side.
Sure. I think obviously we had good solid growth in each of the markets. And we expect that the retail, the repair and remodel market, to still kind of stay with where it has been estimated by HIRI, somewhere in the mid-single-digit range. The construction market, from where we are – as you know, we don’t provide components all over the country. We are in selective markets, and we still see very solid continued growth in the markets that we are in. So we feel good about that. And then on the industrial market, economy still seems to be doing well and that continues to bode well for the future. Obviously, everyone is keeping an eye on future interest rates and what that looks like and does that slow the economy. But right now, we feel very good about where we are in each of the markets.
Okay. And then last one for me. You mentioned some significant opportunities with Deckorators. Can you maybe elaborate a little bit more what you are seeing there and any other of the branded products, what kind of growth rates did you see this quarter? And you said – I think you said significant double-digit or some double-digit number for next year. Can you just help us with maybe a little bit more detail for that part of the business?
Yes, I think, without trying to get too specific on it, we are very pleased with the current selling season, which will be for 2019 business. We had very good reception; we are going to take a lot of market share in the retail space with our Deckorators brand. And as I said, significant double-digit growth is what we are looking for. And very confident we will get there and it’s exciting the reception that we are receiving on the new product layout.
Maybe, without getting into detail on specific revenue for you guys or anything, is there like a market opportunity? Can you talk to us about what the retail market opportunity is or what the overall revenue in the retail space is that you can – your addressable market, I guess. Can you talk to that? And I don’t think it is an area that you guys have been very big in before, so it seems like a new – some new commentary for you.
Yes. So obviously, we’ve been in the business since 2002 in the wood plastic composite business. We also have our new technology within the Deckorators family of products. The addressable market, obviously we know the major players in that space. Addressable market is in excess of $1 billion and it is growing. So I think our share is very modest today and we expect that it will continue to grow pretty rapidly. We would hope that it would double over the next 24 to 36 months.
Okay, great. Very helpful. Thanks guys.
Thank you.
Thank you. And our next question comes from Dan Jacome from Sidoti & Company. Your line is now open.
Good morning.
Good morning, Dan.
Hey, most of my high-level questions have been answered. I just had some housekeeping questions. But first, wanted to stay on the Deckorators topic. I think you said you’re targeting incremental market share gains in the retail space. Do you feel comfortable that when – in that ecosystem or what have you in the big box you might be able to pick up incremental share as well or is that safe to assume for me?
Yes. We’d certainly expect that.
All right, okay. And then – so on lumber prices, the last data point I had is actually the September $430 per 1,000 board feet. And then you gave us some guidance that you are going to be down year-over-year at the moment. So, I’m assuming you guys have the October prices. Are we significantly below $430 at the moment? I am just trying to gauge the magnitude of where we are versus last year in terms of like the delta.
Yes. I don’t think we’re too much below that depends on the type of product you’re talking about. But I think, if you look at composite index, I think we’re in that space. But we’re a little bit below – as of last week, a little bit below a year ago in the market.
A little bit. Okay. All right. So, we’re still in the $4-s as expected. And then sorry if I missed it; did you say there was some impact to your business from the hurricane? And if so, what exactly was that? I’m assuming it was somewhat modest, but I’m just checking.
Yes. I think the hurricane impact, at least thus far, has been modest. I think a part of that comes from the aftereffects of the hurricane. And some of the things I referenced about orders being pushed, that’s directly related to the hurricane and sites being too wet to put product in and all of that. But within Q3, very modest; within Q4, we had Michael hit in Q4, so probably some short-term impacts, but long-term, probably a plus overall.
Okay, great. Thanks.
Thank you.
Thank you. And our next question comes from Steve Chercover from D.A. Davidson. Your line is now open.
Thanks. Good morning, Matt and Mike.
Good morning.
Good morning, Steve.
So first question, I guess it goes – well, not really to Ketan’s. But you did mention that there were permit delays and that was an issue both for IDX and also I think for the framing segment. So, I thought that we were actually trying in this country to diminish regulation and red tape. So, is it simply that there is no one home at city hall when you go to get the permits?
That’s probably not the right question for me, but probably, talk to some of your legislators. I would say from our standpoint, their requirements have gotten a lot more difficult in many markets. And so there is a significant number of hoops that still need to be gone through, probably more than there used to be, and more levels of approvals. So that’s what we hear in terms of the feedback. We’d like it to be more streamlined, and some government units are actually working towards that, but it’s a mixed bag.
Got it. Okay. And then a question about inventories versus cash from operations. So year-over-year, the inventories are up about $39 million and the cash from ops is down by about the same amount. And I am just wondering will that reverse itself by year-end?
Yes, it should.
Yes. I think I had mentioned before that October was going to be a month, where our working capital comes down a lot; inventory in particular. And I think that will continue on through the balance of the year. We have about $30 million on our revolver at the end of September and I think that will be gone here in the next six weeks or so.
Okay. Thanks for that Mike. And finally on labor, which has been an issue for you in the recent quarter and probably, for much longer than that. Unfilled job openings just hit a record; I think they’re in excess of 7 million vacancies. So, it’s probably not going to get better anytime soon. So, are you guys capable of pulling people back into the labor force, because UFPI is well established and attractive place to work? Or is the solution going to be more from technology and automation?
We think we have a very good reputation as an employer in the markets that we serve. And so for us, it may alleviate it somewhat, but it’s still a very real challenge for nearly all of our operations to get quality people, who want to work. And so with that as a backdrop, we are investing heavily in automation and new equipment to help us alleviate some of the need for kind of the hardest to fill jobs, which are the entry level positions, which are not the easiest jobs. So if we can do that and still create the opportunities for our existing employees to move up and enhance their careers with us, that’s our goal. And so far, you see it in the overtime numbers is where we think that it hits us the most. If we could get more employees, we could probably reduce some of that overtime.
Okay. And then you did indicate somewhere in the press release that the UFPI University is having some benefit. So, those are guys presumably, who are beyond the entry level that go through that; they are folks that you perceive as management material?
Yes, sir.
Great. Okay. Thanks, Matt. Thanks, Mike.
Thank you.
Thanks, Steve.
Thank you. And our next question comes from Tom Leritz from Kennedy Capital. Your line is now open.
Good morning, guys. How are you doing? Just a quick question; a lot of my questions have been answered. But just wanted to ask about how October is trending. I noticed that we had September housing data that came out this morning. It seemed like a large drop-off in the South. I think a lot of it was probably related to the hurricanes. But could you just talk about that, how October is trending, especially in those hurricane-impacted areas?
Sure. And I think that’s a good question. As we look at it, we do think there will be some impact to starts in certain of those markets for sure. I can tell you that from our own perspective, our operations in those markets order files are very good. Commitments from the customers are very good. So as long as they are able to get the jobs completed, we feel very good about where we are positioned, particularly with respect to the construction market.
Okay. And then just on IDX, any exposure to Sears or Kmart or some of the struggling retailers? Is that impacting the business at all?
No, it isn’t. I think IDX tends to do a little more of the higher-end kind of fixtures. So some of the fixture companies, which are more commodity type, that is not really IDX’s forte. It is not the area that they participate in. As we discussed a few years ago, Macy’s and J.C. Penney were two of their bigger customers and they are no longer two of their bigger customers as they’ve slowed down their installs. But IDX has done a really good job of substituting other companies and customers and really expanding their base. While they are still doing retail apparel, it is a much smaller percentage of their total. And again, that’s why we’ll feel confident about it long term.
All right. Well, that’s all I have. Thank you.
Thank you.
Thank you. And our next question comes from Ketan Mamtora from BMO Capitals. Your line is now open.
Thank you for taking my follow-up question. So just coming back to the lumber market, so you’ve seen a pretty sharp drop on the SPF grades, but the southern yellow pine, at least the two-by-four, hasn’t fallen that much. Are you seeing any more substitution or do you have the opportunity to use more SPF than SYP?
Yes. I think it depends on the application. So in many of our applications, we can substitute species. In wood preservation, for example, SPF is not a very easily treatable species; some would argue not treatable at all. So southern yellow pine is really the preferred item for the treatable species. But in other applications where the pricing makes sense, we can certainly substitute species.
I see. Understood. And then just one last question on IDX. Just remind us again where you are in terms of the end market split in terms of retail exposure versus others. I recall that you have been doing things to diversify the end markets there, but if you can just remind us.
Yes, I think where they were probably five years ago was roughly 90% retail, retail apparel; 10% other. They are moving much closer today to being 50/50. And with the plans they have in place, that will be even less than 50% retail apparel and more than 50% in these other categories going forward.
Understood. That’s very helpful. I will turn it over. Good luck again.
All right. Thank you, Ketan.
Thank you. That concludes today’s Q&A session. I would like to turn the call back over to Matt Missad for any closing remarks.
Thank you, Shelby. As I stated, we are committed to improving our performance and aren’t satisfied with simply setting records. Our goal is to reward our shareholders with consistently strong performance and an exceptional return on their investment. And I am fortunate to work with the greatest team in the business which has the skills, abilities, and work ethic to achieve these goals. And while we are working on improving the business, I hope each of you will be voting to make sure that our country and its states maintain and support policies that encourage economic growth, stability, and opportunities for citizens to improve their lives through their personal efforts. Thank you and have a great day.
Ladies and gentlemen, thank you for participating in today’s conference. This concludes today’s program. You may all disconnect. Everyone have a great day.