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Greetings. Welcome to the Century Communities Fourth Quarter 2019 Earnings Conference Call. [Operator Instructions] Please note, this conference is being recorded. I will now turn the conference over to your -- to Hunter Wells, Vice President of Investor Relations for Century Communities. Thank you. You may begin.
Good afternoon. Thank you for joining us today for Century Communities' fourth quarter and fiscal year 2019 earnings conference call. Before the call begins, I would like to remind everyone that certain statements made in the course of this call are not based on historical information and may constitute forward-looking statements. These statements are based on management's current expectations and beliefs and are subject to a number of risks and uncertainties that could cause actual results to differ materially from those described or implied in the forward-looking statements. Certain of these risks and uncertainties can be found under the heading risk Factors in the company's most recently filed annual report on Form 10-K as supplemented by our other SEC filings. Our SEC filings are available at www.sec.gov and our website at www.centurycommunities.com.
The company undertakes no duty to update any forward-looking statements that are made during this call. Additionally, certain non-GAAP financial measures will be discussed on this conference call. The company's presentation of this information is not intended to be considered in isolation or as a substitute for the financial information presented in accordance with GAAP. Management will be available after the call should you have any questions that did not get answered.
Hosting the call today are Dale Francescon, Chairman and Co-Chief Executive Officer; Rob Francescon, Co-Chief Executive Officer; and Dave Messenger, Chief Financial Officer. Dale will review our operating highlights and business updates. Rob will then discuss our business and markets in further detail. Afterwards, Dave will follow up with further information on our financial results, balance sheet and 2020 outlook. Following our prepared remarks, we will open the line up for questions. With that, I will turn the call over to Dale.
Thanks, Hunter. We're very pleased with our strong finish to 2019, which resulted in record performance for the fourth quarter and full year as we continue to generate opportunities and efficiencies due to our scale, geographic scope and market positioning. In 2019, we achieved our 17th consecutive year of profitability, along with significant year-over-year improvement in virtually all metrics, including revenue, deliveries, sales, net income and shareholders' equity. Last year also represented our fifth anniversary of becoming a public company. Over this relatively short period, we transformed ourselves from a small regional homebuilder operating in 3 states, delivering less than 1,000 homes to one of the 10th largest homebuilders in the country delivering 8,000 homes in 17 states from coast-to-coast for $2.5 billion of revenue. Over this time, we've been almost exclusively focused on growth and select market expansion primarily through the acquisition of other homebuilders. In order to create a stable and scalable platform to support future growth, we deployed significant financial and human resources towards the integration and assimilation of these formerly independent businesses as well as developing the people, processes, procedures, systems and reporting required to properly manage an enterprise of this size. As we look to the future with these actions successfully accomplished, we're very pleased with the state of our business today and excited about our prospects for the future. In fact, we believe that our achievements over the next 5 years will meaningfully surpass our substantial accomplishments of the past. Given the significant strides we've already made in strengthening our business and improving our competitive positioning. Our efforts going forward will continue to be on driving growth with a primary emphasis on organic top line revenue expansion through increasing our depth within each market. However, we are equally focused on further executing on a variety of strategic initiatives designed to improve our financial and operational results and help achieve the true value that we believe our business deserves. For example, we have made significant progress over the last year in streamlining and value engineering our planned library along with incorporating the increased use of panelization, trusses and precut framing packs across our platform. We have also centralized various aspects of our purchasing efforts and increased both the number of and benefit from national and regional purchasing contracts and rebate agreements. Our enhanced internal systems have given us the tools to compare, track and monitor all aspects of our business at a very detailed level, which visibility we are using to drive improvements throughout the company. We began to realize direct cost savings, variance reductions, shortening of cycle times and other benefits from these strategic initiatives towards the end of last year, which we expect to accelerate as we move further into 2020 and beyond. Last year, we completed the final stages of integration for the Wade Jurney Homes acquisition. Wade Jurney Homes has proven to be a great investment and a valuable product line, enabling us to capture additional share of the affordable home segment. Earlier today, we announced the rebranding of Wade Jurney Homes to Century Complete to align with our overall brand, better showcase its value proposition to potential buyers and maximize the potential of this truly differentiated product. We will now only offer homes under the Century Communities or Century Complete brands. The newly christened Century Complete will operate the same as it did as Wade Jurney, providing comparable offerings, targeted at affordable price points and retaining its land-light, no-options spec strategy. The purpose of instituting the updated branding is to clearly message us as one company and better position us to demonstrate the value of our Century Complete homes. We remain committed to offering the lowest priced new home opportunity in the market, consistent with our more home less money marketing message. We continue to make substantial progress in lowering the average selling price of our homes. The ASP of homes delivered in 2019 dropped to $310,200, down from $346,000 the prior year. And while we have seen more and more builders shift their focus lately to entry-level price points, we were a first mover in making this transition, and deliver some of the lowest and most competitive home pricing across the country. While this segment is often referred to as entry level, it's important to note that there are many factors at play driving this demand today, and we're seeing it across multiple demographic groups from millennials seeking their first home to baby boomers looking to downsize. Across the nation, there is a shortage of affordable housing and the resale market continues to be undersupplied. According to a recent research report, the average U.S. family cannot afford to buy a home in over 70% of the country. In December, the FHA once again announced expanded loan limits, increasing the number of households, which qualify for FHA loans. The vast majority of homes in the Century portfolio are eligible for FHA financing further demonstrating how well positioned Century is to capture increased market share of the affordable home segment. In fact, with an average ASP in the fourth quarter for our Century Complete line of $155,000, a homebuilder -- a homebuyer needs less than $30,000 in annual income to qualify for an FHA loan with a monthly payment of less than $790, including principal, interest and mortgage insurance. Truly making a home purchase less expensive than renting. We believe with successful execution, we will continue to strengthen our business, propel our growth trajectory and create further improvements in return on equity and leverage. We are operating in a demand environment of tremendous potential, supported by strong economies across our markets and healthy housing fundamentals. We're focused on expanding our Century Complete geographic footprint as well as widening and deepening our penetration of our existing markets. And while we're already one of America's most affordable homebuilders, we believe we have an outsized opportunity to capture additional market share. We're excited to take advantage of the opportunities ahead of us as we capitalize on our national platform, competitive positioning and increased scale to deliver accelerated top line growth, improved operational performance, expanded profitability, and in turn, deliver outsized returns to our shareholders.
Now I'll turn it over to Rob to discuss our markets in greater detail. Rob?
Thanks, Dale, and good afternoon, everyone. As Dale mentioned, we generated strong performance across the board in the fourth quarter, including year-over-year improvements of 45% in net new contracts and 22% in closings. The strong sales momentum that we experienced in the fourth quarter has continued into 2020 with record January net new contracts up 67% compared to the prior year. Given the January 2019 sales were depressed due to market conditions existing at that point, we are not projecting the same rate of year-over-year improvement for subsequent months. However, since our robust January sales results were consistent across our business and regions, we are extremely positive about the current homebuilding environment and our prospects for the balance of the year. With that perspective, I'll provide a brief overview of our recent performance and demand trends across each of our regions. In the fourth quarter, Texas achieved a 64% increase in net new home contracts and a 41% increase in home deliveries. We successfully lowered the ASP of homes by 8% and achieved a 30% increase in home sales revenues. In 2019, Austin was named America's fastest-growing large city, driven by population and job growth, while San Antonio is on track to become the nation's sixth largest city by 2021. Over the next decade, Houston is projected to have the second highest number of new residents for any metro area with the addition of nearly 1.2 million people, an increase of approximately 17%. We are confident these positive trends will continue to strengthen the market in 2020, and believe Texas is an impressive example of a high-growth opportunity where we have significant potential to capture increased share given our product positioning. In our Mountain region, we saw significant growth with net new contracts, up 35% year-over-year, reflecting an accelerated pace of activity across the region. Las Vegas continues to impress us as one of our most vibrant markets. We believe we have significant opportunity to take price increases and market share within this high-growth land-constrained metro environment. Colorado market is healthy and stable, and we continue to benefit from our strong market share position. In Utah, we are seeing heightened demand due to increased immigration and organic population growth, coupled with a tight resale market. We believe the Mountain region will continue to be an exciting opportunity for growth, supported by our nearly 13,000 owned and controlled lots in this region. Turning to the West. We're pleased to report we saw a positive turnaround in this region as market conditions stabilize. In fact, the West outperformed all other regions during the fourth quarter in terms of net new home contracts, up 78% compared to the prior year. We delivered 346 homes in the fourth quarter, up 73% year-over-year. We are seeing positive momentum and expect demand in the West region across California and Washington to continue to build in 2020. We also saw solid performance in the southeast with net new home contracts up 58%, with a 9% increase in home deliveries to 556 homes. We are confident in the potential prospects for growth across the Southeast supported by thriving local economies. Charlotte was the fifth fastest-growing city in 2019 for population expansion and is now the 16th largest city in the country. In Atlanta, unemployment remains low as job growth continue to increase through December. The Nashville market remains strong as home sales rise and homebuyers benefit from low interest rates. Wade Jurney Homes or Century Complete, as we have now rebranded it, continue to deliver solid performance with net new home contracts up 27% for the fourth quarter compared to the 2018 results. Home deliveries increased 26% to 803 homes from 637 homes in the fourth quarter of the prior year. These results are particularly impressive given all the internal efforts that were focused on successfully completing the move and integration process. During the year, we began operations in 4 new states: Iowa; Indiana; Michigan; and Ohio. And we've already begun to capture share in these new markets with 2019 deliveries in each. Looking ahead, we believe additional efficiencies will be generated as Century Complete is brought to scale. Internally, we have segmented Century Complete into various local geographic areas that we refer to as regions. Given the centralized nature of various aspects of the business and an offering consisting of standardized and value-engineered plans built across the platform, geographic expansion within a region can be accomplished with reduced start-up costs. When scaled, a region would approximate a large Century division with annual closings exceeding 1,000 homes. To support our expected growth, we are focused on further increasing the land supply beyond the current 8,000 Century Complete lots. Our land underwriting standards for Century Complete are substantially similar to those used in the balance of the business, except that we expect increased ROIs since we typically only purchase finished lots. Thus returns are not impacted by the time it would otherwise take to improve the lots. We ended the year with increased total lot inventory across the portfolio of 38,942 lots, up from 37,919 lots the prior year, and improved our percentage of controlled lots to 52% compared to the 45% that existed at the end of 2018. We've successfully grown Century to become a top 10 national homebuilder, expanding our footprint into some of the nation's most robust and desirable markets. We are operating in metro areas, which are experiencing job growth, population expansion and flourishing economies. As we've grown the business, we've applied our extensive local knowledge to deepen our presence and capture increased share in both new and established markets. Today, we're well positioned with a solid pipeline of new communities and ample lot positions, which will enable us to fuel future demand. Looking ahead, we remain encouraged by the current homebuilding environment as we execute on our strategic initiatives to drive increased performance across each of our regions. I will now turn the call over to Dave who will provide greater detail on our financial results and outlook.
Thanks, Rob. During the fourth quarter of 2019, our net income increased more than 100% to a record $53.4 million or $1.63 per diluted share. Home sales revenues for the fourth quarter were a record $775.7 million an increase of 21% compared to $640.2 million in the prior year quarter. This improvement in revenues was mainly driven by a 22% increase in home deliveries to a record 2,479 as we saw home deliveries increased across all our regions. The average selling price of homes delivered for the fourth quarter of 2019 decreased to $312,900 compared to $315,700 in the prior year quarter, which is consistent with our plan to capture an increasing share of homebuyers at entry-level price points. Adjusted homebuilding gross margin percentage increased 60 basis points to 21% compared to 20.4% in the prior year quarter and up from 20.6% sequentially from the third quarter of this year. Homebuilding gross margin for the fourth quarter increased to 18.2% compared to 16.5% in the prior year quarter and 18.1% in the third quarter. Given the increased demand that we experienced in our markets, we were able to drive an outsized backlog conversion rate and still increase our gross margin both year-over-year and sequentially. Additionally, we recorded impairments of approximately $2 million on a handful of communities across our portfolio. At year-end, our backlog of 2,070 homes has a gross margin profile that's consistent with our fourth quarter deliveries, and we expect to deliver these homes in the next couple of quarters. Consistent with our year-long plans, we made solid progress in improving our SG&A leverage in the fourth quarter. SG&A as a percent of homebuilding revenues improved to 10.9% in the fourth quarter compared to 11.4% in the prior year and 12.7% in the third quarter. With our fourth quarter SG&A percent of 10.9% and our 2019 full year SG&A percent of 12.2%. Looking ahead, we expect to benefit from additional efficiencies and expenditure reductions due to our increased scale and the completed integration of all prior acquisitions.
Our fourth quarter results were adversely impacted by a total of approximately $9.5 million of onetime items consisting primarily of the previously mentioned $2 million inventory impairment, a $2.8 million intangible asset write-off of the Wade Jurney Homes name, $1.5 million related to various onetime insurance settlements and $3 million related to 45L consulting fees due to the reinstatement of energy-efficient home tax credits. In the fourth quarter of 2019, our financial service business, consisting of title, insurance and mortgage generated $14.5 million in revenues, up 39% year-over-year. The business contributed $4.7 million in pretax income compared to $3.3 million in the prior year quarter, a 42% increase and reflecting a stable margin of approximately 32%. Now turning to our balance sheet and liquidity. As of December 31, 2019, our stockholders' equity expanded to a record $1.1 billion. During the quarter, we successfully extended the maturity of our line of credit to April 2023, and put in place a $110 million accordion. We reduced our total long-term homebuilding debt to $965.4 million and increased our total liquidity to $662 million consisting of $90.7 million in cash and $571.3 million of capacity on our unsecured revolver, excluding additional availability under the accordion. In the fourth quarter, we dramatically improved our net homebuilding debt-to-net capital ratio to 45.2%, a 680 basis point improvement since the beginning of the year, and an 860 basis point sequential improvement. We have previously stated our commitment to reduce our homebuilding leverage below 50%. And on our third quarter call, indicated that might not occur until 2020 due to anticipated land transactions prior to year-end. Due to typical transaction delays, certain land closings slated for Q4 occurred in Q1. On a pro forma basis, had the land transactions occurred in Q4 as originally planned, the impact would have been minimal and our net debt-to-capital ratio would still have been less than 46.5%. During the quarter, as we previously announced, we opportunistically issued approximately $50 million through our ATM program as a result of a reverse inquiry to accelerate our deleveraging efforts. Over the past couple of years, we have been able to effectively utilize the ATM program to fund external M&A, organic growth and delever. As we look forward to growing our business, we'll be primarily focused on organic growth with a goal of strengthening our balance sheet, improving leverage and increasing ROE. Accordingly, we expect to rely less on the ATM as a source of funding for these initiatives. In the fourth quarter, our tax rate was 1.1% compared to 27.4% in the same quarter the prior year due to the recent extension by Congress of energy-efficient home credits. We are extremely pleased with our fourth quarter and full year 2019 results. As both Dale and Rob have discussed, our markets are healthy and have strong outlooks for 2020. Accordingly, with our positive momentum and the current demand environment, we are introducing our 2020 guidance of deliveries to be in the range of 8,500 to 9,500 homes, and home sales revenues to be in the range of $2.6 billion to $3 billion. We expect our quarterly trends to be consistent with prior years with our first quarter generating the lowest number of closings and the fourth quarter the most. With that, I'll open the line for questions. Operator?
[Operator Instructions]
Our first question is from Michael Rehaut, JPMorgan.
Congrats on the results. First question I had was kind of focused in around the growth outlined or expectations for fiscal 2020 in terms of the closings growth and the revenue growth, but in particular, the closings. Historically, I've always kind of thought of the core business, and as I've talked to you guys over the years, the goal has been maybe to kind of grow the core around 10% and then whatever acquisitions add on top of that would be an additional amount. Maybe you could kind of walk through what the -- with the closings guidance up roughly 5% to 20%, so a little bit higher at the midpoint, what's driving that slightly more robust growth outlook? If there are certain markets that you're kind of looking at more aggressively if it's Century Complete, if that -- you continue to expect that to trend above kind of demonstrated an above-trend growth line. Any thoughts there would be helpful.
Mike, and this is Dale. I think part of it is we look at how the demand has started so quickly this year. And we look at where our markets are positioned and how they're performing. As we just look forward for the entirety of the year, we think that we're going to end up somewhere within that range. In terms of particular markets, if they're really across the board in terms of how they're performing. And so as we sit here today, we're really positive about homebuilding in general and our prospects in particular.
Just a follow-up on that before I ask a second, if it's possible. Given that the revenue growth be pretty similar in terms of the low and high-end to the closings growth, is it fair to assume that the Century Complete business would grow at a similar rate to the legacy Century business? Obviously, you guys have had a decent mix shift on average closings price over the last couple of years.
Well, as we look at it, it's hard to project exactly how the mix is going to come out. But as we look at it, we would anticipate that on the Century Complete side, that we would get a higher growth rate than on the Century Community brand product.
Okay. I guess just last...
But that being said, I mean, we're really seeing strength at all price points. And as I say, virtually all markets.
Right. I guess, just lastly, maybe a clarification on the gross margin side. Dave, you mentioned that, if I heard you right, that the backlog gross margin was consistent with the fourth quarter, and you'd expect that to persist over the next couple of quarters in terms of your results. Is that a comment on preinterest in inventory impairments? And how should we think about interest amortization for the upcoming year?
Handling that second part first. I'd say, if you're looking at your interest amortization running through the cost of goods sold, good numbers, probably about 2.5%, especially given that we brought our leverage down you should see 2.5%, be relatively flat throughout the balance of the year. And then in terms of what I was making in terms of margin comments, on a GAAP basis, we're seeing about an 18.2% right now in our backlog and adjusted for the fourth quarter, it was 21%. And those numbers are pretty consistent with where we look at our backlog as of 12/31. We would expect as those homes come through the pipeline in Q1, Q2 of next year, we ought to be seeing similar margins.
Our next question is from Thomas Maguire, Zelman & Associates.
Congrats on a great quarter all the way around. On the overhead piece of the business, it was really a nice -- exciting rather to see leverage start to come through in full force. And I know just thinking back, there are some integration issues and different things that have prevented that before that you touched on in the prepared remarks, and you alluded to it a little bit, but can you just talk about where all of that is right now? And then as we think about moving forward, is there any outsized cost increases or items to be aware of moving into 2020 that would drive kind of the cost base meaningfully higher? Or is it full speed ahead on continuing to show improvement into the new year with overhead leverage?
So in terms of the integration, I mean, it's 100% behind us. We have no more integration to do or cost to incur for any of the acquisitions that we've done. And then as we look forward into 2020, we really don't see any outside costs that are going to come in that we haven't already incurred, and we really believe we can continue to create efficiencies and work those costs down as we get into 2020 and particularly in the back half of the year.
Yes. One thing I would add with that. Now that 2019 has come and gone, we have all our prior acquisitions integrated. 2019 was our lowest SG&A percentage on an annual basis in the last 4 years. As we look into 2020, and as Dale said, we've got an opportunity really to drive scale and drive some efficiencies out of this. I would expect to see our SG&A into 2020 be mid- to high 11% range.
Got it. That makes sense. And then just similar strong results on the gross margin side. But can you just talk about the moving pieces that drove that higher in the quarter and kind of the higher rate into 2020? Is there anything that you had cautioned on mix that's impacting that at all that wore off eventually? Or is it just more gradual improvement in a better selling environment and then some of the dynamics that you talked about on scale and maybe splitting those 2 out, if you can, just ballparking it and thinking about what's driving more than less?
Yes. No, there is really no mix that was unusual. It really is a function of -- we're starting to see benefits of our direct costs from some of the strategic initiatives that we started last year, and that we'll continue to expand into 2020. That coupled with the fact that as we look at the markets, as I said earlier, I mean, they're all performing very well. And so we had -- obviously, Q4 had more incentives in some of those sales than in the sales that we're accomplishing today. But as we go forward, we really don't see anything that will hold our gross margin back from being where it currently is.
Our question is from Alex Barrón, Housing Research Center.
Great job on the quarter and the year, gentlemen. I had a question about, I guess, the transition from Wade Jurney to Century Complete. Is there anything changing fundamentally besides the name?
No. It's the same business, the same business approach. It's strictly a name change to better align it with the entirety of the Century business. So we just thought it made sense to make that change.
So you guys are still going to be building specs, entry-level, really affordable prices selling from shopping centers, et cetera?
Absolutely.
It's the same business model.
It's all the same.
Okay. And I know you guys have launched into several markets over the last 12 months. Is there a plan to continue to expand in new markets at this point? Or just to kind of gain greater depth in the existing markets?
So first and foremost, Alex, we want to gain greater depth in our existing markets. With that said, being in the multiple markets that we are, we really think that there's a tremendous opportunity to do that. Secondly, though, there are some strategic markets that we're looking at. They're just in their infancy. And the nice thing, especially on the Century Complete side, to expand into that area, the way we're structured, it's a very cost-effective way to get started. So it's not a typical start up that you would have on a homebuilder scenario with our plans, with our people, with our centralization. It just makes it much more efficient and less expensive to do that. So we like that aspect. But first and foremost, we want to continue to gain share within our existing markets.
Just to follow-up with that, Alex, for clarity, we are -- the geographic expansion that we're targeting is only in the Century Complete brand.
Correct. Now what is the kind of current situation for that type of product in terms of land? Is there opportunities to buy finished deals? Or do you guys have to engage in land development at this time?
We're still buying finished lots, 100% finished lots. We're still finding good opportunities to do that. With that said, though, there are sometimes situations where an outside developer will put the lots on the ground for us. But we're still, from our standpoint and our balance sheet, land-light approach, we are only purchasing finished lots.
Our next question is from Jay McCanless, Wedbush.
The first question I had. So Wade Jurney of -- 2019 closings was roughly 35% of the closings. Do you all expect it to be in that range or a little bit higher in 2020?
I would think that you're probably going to see that increase by some factor in 2020. As we said, we've got an opportunity to grow that business a little bit quicker than we do, the Century business. And so while we're expecting growth out of all of our markets, that percentage being 35% could increase over the course of 2020.
And then just, Dave, what should we use for tax rate this year?
About 24%, that would be inclusive of energy tax credits.
And then I have it, and I apologize if I missed this, but have you all talked about what your plans are for community count growth outside of Century Complete?
No, you didn't miss it. We hadn't discussed it. But as we have on the docket, opening and closing a variety of communities throughout the course of 2020. Currently, we're forecasting community count growth to be somewhere between 5% and 10% at the end of year end.
And any geographic focus on that community growth?
No, I say it's broad-based.
And then the last one I had, just to -- and congrats on the 67% number for January. I was wondering if you could give us what the monthly comps were for February '19 and March '19, just so we can think about what the right order growth number should be for 1Q '20?
No, we haven't disclosed any monthly data other than just typically, we provide some color on the month following a quarter up to our call. So unfortunately, we're not going to be providing that in full right now.
Our next question is from Alex Rygiel, B. Riley FBR.
This is actually Min for Alex. So a couple of questions. I wanted to talk a little bit about your financial services business. If you could talk about kind of if it's being offered across all of your regions now? And just talk a little bit about the capture rate, what you expect it to kind of get to potentially in 2020?
This is Dave. I would say that from a capture rate perspective, the Century business has a higher capture rate than does our Wade Jurney business or our Century Complete business now as that was really being worked into the system, into our sales process during the course of 2019. And we expect 2020 to have a bit more of a breakout year as we should be able to capture it throughout the course of the second and third quarter more of that Century Complete business and more of that home buyer, which we have traditionally not done in that division of our business.
Okay. And are you expecting to add anything? Could you add anything else to this financial services business, maybe insurance or anything like that to expand your sales opportunity? Or just kind of focused on what you're offering now?
Currently, we do offer mortgage title and insurance services, the insurance services we had started in 2019. Currently, a very small -- running at a very small loss for the balance of 2019. And we expect as people begin renewing homeowners insurance that we've offered, provided to them as they start to renew that in 2020, it becomes a little bit of a larger portion of that business over the next several years. But given that you're dealing on premiums off of homes being sold. I don't ever expect it to be a truly material part of that business.
Okay. And then just with the homebuilding orders just across the board being very strong. At the end of the year and going into 2020, can you talk a little bit about kind of inflationary costs that you're seeing? I mean, do you think labor could be a barrier to growth in 2020?
We're really not seeing a lot of direct cost inflationary pressures. When we look at the material side, certainly, there can be ebbs and flows, depending on the particular line item. But generally speaking, we're just not seeing that like we did several years ago. So that seems to have corrected itself. In terms of labor, there's always been a shortage of labor as we've come out of the recovery and as homebuilding is ramped up. And as companies continue to build both on a for-sale and for-rent side, there isn't enough labor. However, with that said, by being the size we are, we've been able to garner enough within our market. So that it keeps our cycle times where we want them and all of that. So it hasn't been an impediment to us, but there isn't robust labor in the market.
We will now turn the line back over to Dale for some brief closing remarks.
Thank you, operator. As we look ahead to 2020 and beyond, we're excited for the opportunities ahead and are confident in our ability to execute our strategic initiatives to deliver continued results. I'd like to thank our employees for their hard work and dedication. We wouldn't be where we are today without your passion for success. We'd also like to thank our valued shareholders for their continued support, and thank all of you for joining us on today's call. And we look forward to speaking with you again next quarter.
This concludes today's conference. You may disconnect your lines at this time. Thank you for your participation.