Good morning. My name is Candice, and I'll be your conference operator today. At this time, I would like to welcome you to the AutoNation Second Quarter 2022 Earnings Conference Call. All lines have been placed on mute to prevent any background noise. After the speaker’s remarks, there will be a question-and-answer session. Thank you. I would now like to turn the call over to Ankur Shah, Director of Investor Relations. You may now begin your conference.

Good morning and welcome to AutoNation's second quarter 2022 conference call and webcast. Please ensure that your lines are muted until the operator announces your turn to ask a question. Leading our call today will be Mike Manley, our Chief Executive Officer; and Joe Lower, our Chief Financial Officer. Also joining the call is Derek Fiebig, Vice President of Investor Relations. Following their remarks, we will open up the call for questions. We will be available by phone after the call to address any additional questions that you may have. Before beginning, let me read our brief statement regarding forward-looking comments. Certain statements and information on this call, including any statements regarding our anticipated financial results and objectives, constitute forward-looking statements within the meaning of the Federal Private Securities Litigation Reform Act of 1995. Such forward-looking statements involve known and unknown risks that may cause our actual results or performance to differ materially from such forward-looking statements. Additional discussions of factors that could cause our actual results to differ materially are contained in our press release issued earlier today and in our SEC filings, including our most recent annual report on Form 10-K, subsequent quarterly reports on Form 10-Q, and current reports on Form 8-K. With that, I will turn the call over to AutoNation’s Chief Executive Officer, Mike Manley.

Thanks, Ankur. Bright morning, everyone, and thank you for joining us. Firstly, I really want to spend a little bit of time to thank all of the team at AutoNation for continuing to deliver great results in the quarter, which enabled Joe and me to report another record performance. As usual, Joe is going to take you through the numbers in detail, and I'll begin with the general overview of performance. So from a substantially flat year-over-year revenue of $6.9 billion, we were able to increase our operating income by 5% to $558 million, which, as I already mentioned, is a record for the group. Our earnings per share for the quarter was also a record of $6.48, a year-over-year increase of 34%. Now, as you can see, because the new volume was down 25%, which, when you consider our low level of new inventory and our high inventory turn rates, was in my view purely a result of continued constrained supply. As you can see, volume was substantially offset with strong margins up 47% compared to the prior year and stable quarter-over-quarter, again indicating that demand for new vehicles remained strong. Used revenue in the quarter was 13% above the prior year; however, from a volume perspective, total used sales were down 4% and down 9% on the same store basis. Overall, the volume reduction was within our entry selection of vehicles priced at $20,000 and below. When you look at our performance, our mid and premium used vehicle categories both increased in volume year-over-year, which indicates strength in demand in those price bands. What is clear to me, though, is that our year-over-year volume trends, even though they were basically in line with the industry, I believe we had some volume upsides which frankly we left on the table in the quarter. Historically, about 40% of our sales have been in the entry category, and clearly that is a segment that is under pressure. We have already shown we can improve our mix particularly in the mid-priced bands, and the teams are now very focused on that, and as I said, these segments increased year-over-year. You may remember that during our last call, I told you about our focus on improving used margins, and I'm pleased with the progress we made since the end of that quarter, and this continues to be a daily focus. Our F&I teams continue to prove they're the best in the business with another strong performance this quarter. What is important to note is that the main driver of our performance is the penetration we achieve with optional products—namely, service plans and extended warranty. As a result, the announcement we made today regarding our agreement to acquire CIG Financial is not only complementary to what we're doing today, but we will also, over time, bring significant upside. In previous calls, I have made a point to discuss the structural changes we've made in our business; however, I don't think we get sufficient recognition for it. Our ability to generate used vehicles is a considerable strength and an advantage over some of our single-focused competitors. During the quarter, we self-sourced either from trades, lease returns, or our very successful 'will buy your car' program over 90% of our used inventory. This strength continues to put more of our destiny in our own hands. Other areas of structural change include our office hours, which are intended to focus on our customers, creating double-digit growth of 11% in after-sales gross profit. This is part of our business where I believe we have further upside. In the past, we have also discussed our disciplined approach to cost management, and as you can see, it is gaining the results and benefits this continues to bring to the business. Moving on to AutoNation USA, today we announced our plans to open a new AutoNation USA store in Georgia. This will happen in the third quarter, and this will be our 12th store. Just to remind everybody, our objective remains to have over 130 of these stores in operation from coast to coast by the end of 2026. We also announced today that we've entered into an agreement to acquire CIG Financial, and subject to normal closing conditions, we expect to close in the next 90 days. The acquisition of CIG Financial aligns with our strategic business model and singular focus on personalized finance and mobility solutions that are transparent and customer-centric. This acquisition provides capabilities, footprint, technology, and most importantly, a proven motivated team with great leadership. CIG has everything we need to scale and improve our financial performance with modest upfront investment and little risk. While this is an important addition to our growth strategy, we have no present intention to displace or replace existing captive financing with our OEM partners. Our intention is that we will focus our new captive finance house on our AutoNation USA business and the great book of business that CIG has developed with its many retail partners. From the AN USA perspective, there's already a strong overlap from a FICO point of view, from a geographic perspective, and the business development focus that has ensured the success and growth of CIG over about the last two decades. This will be a great addition to the group, and as I mentioned earlier, we will, over time, unlock significant upside in our already industry-leading F&I performance. So, I want to formally welcome 160 new members to the AutoNation family. I can tell you we have been looking forward to this day. And with that, Joe, I am going to hand it over to you.

Thank you, Mike, and good morning, everyone. Before I get into my prepared comments, I would like to welcome Derek as our new Vice President of Investor Relations. I think he will be an excellent addition to our team and someone you will enjoy interacting with moving forward. Now, on to the results. Today, we reported second-quarter total revenue of $6.9 billion, a decrease of 2% year-over-year driven by a 14% decline in new vehicle revenue due to the continuing supply chain disruption to new vehicle production. Mitigating this decline was total used vehicle revenue growth of 13% and after-sales revenue growth of 9% year-over-year. Strong consumer demand and tight new vehicle inventories continue to support new vehicle margins in the second quarter. We expect demand to continue to outpace supply into the back half of 2022. Additionally, as Mike touched upon, our used vehicle margins improved sequentially from the inventory rebalancing efforts in the first quarter, with total used PVR increasing by $349 per unit or up 22% when compared to the first quarter of this year. For the quarter, total variable gross profit decreased 2% year-over-year despite total variable PVR growing to $6,436 per unit or up 17%. Our sustained strength in CFS product penetration and attachment rates helped drive this improvement. We also demonstrated strong growth in aftersales gross profit, which increased 11% year-over-year. Taken together, our total gross profit increased 3% compared to the second quarter of 2021. Moving to costs, second-quarter SG&A as a percentage of gross profit was 55.4%, a record low and a 110 basis point improvement compared to the year-ago period. As measured against gross profit, compensation decreased 190 basis points, advertising was essentially flat, and overhead was higher by 70 basis points, primarily reflecting investments in acquisitions and the expansion of AN USA. This overall improvement is the result of structural changes that we have made to our business model. Taken together and combined with fewer shares outstanding, we reported net income of $376 million or $6.48 per share, a 34% increase year-over-year and an all-time quarterly earnings per share result. Our operating performance and cash flow generation continued to remain strong with cash from operations totaling nearly $900 million for the first half of the year. This performance continues to provide significant capacity to deploy capital. To this end, we announced today an agreement to acquire CIG Financial, as Mike referenced. We agreed to acquire the business for $85 million and assume certain liabilities, a portion of which will be repaid at closing. We are excited to add captive finance capabilities to this acquisition and look forward to working with the CIG management team to grow and integrate the business into the AutoNation family. We also continue to invest capital to grow our business with the expansion of AutoNation USA and remain on target to operate over 130 stores by the end of 2026. We continue to repurchase our own shares. During the second quarter, we repurchased 3.7 million shares or 6% of shares outstanding for an aggregate purchase price of $404 million. Further, we announced today that the Board of Directors authorized the repurchase of up to an additional $1 billion of AutoNation common stock. As of July 2019, there were approximately 56 million shares outstanding. We ended the second quarter with total liquidity of approximately $2.1 billion, and our covenant leverage ratio of debt-to-EBITDA of 1.5 times remains well below our historical range of 2 times to 3 times. Looking ahead, we will continue to focus on operational excellence and disciplined capital allocation to drive long-term shareholder value. With that, I will turn the call back over to Mike.

Yes, thanks, Joe. Ankur, I think let's get straight into Q&A.

Thank you. Our first question comes from Rajat Gupta of J.P. Morgan. Your line is now open. Please go ahead.

Hey, good morning. Thanks for taking the question. Maybe a first one just on the captive finance company, CIG. Can you tell us a bit more about the company, what their customer or loan book looks like today and maybe what is the integration timeline we should be expecting, how is the accounting going to work, when can you see this moving the needle on earnings, etc.? Thanks, and I have a follow-up.

Joe?

Sure. Rajat, good talking to you. Let me give you a few points of reference and a little bit about our thoughts. If you look at, again, Mike emphasized, our focus in this acquisition was on capabilities, it was on the management team, and specifically, frankly, we were not looking to acquire a big book of existing business. So the loan receivable today is just about $325 million, with $300 million of that already securitized. So the residual is relatively modest. They originated about $195 million of loans last year, about 12,000 loans. They have an existing large network of primarily independent dealerships, about 80 of which are independent. Our intention is to continue to serve those institutions. Our integration plan is very deliberate. There's strong overlap in the credit profile, particularly within AN USA. They have a very strong, proven record in both underwriting and in servicing, which was a real attraction to us. Obviously, our first focus is closing, which, as we indicated, we expect within the next 90 days. Then it will be a very deliberate integration focused initially on AN USA that we will roll out over the next 6-12 months as we integrate that and look to build the business in a prudent fashion in the context of our existing business.

Got it, great. Thanks for the color. Maybe shifting gears, Ford this morning announced their updated electric vehicle ambitions. Could you give us a sense of how the conversations are with Ford and other OEMs on how these vehicles will be sold, the floor planning, invoicing, any implications for GPUs? And relatedly, in your service base, what's the OEM involvement looking like with respect to training, tooling facilities, technicians, and how far are you in that upgradation process? Thanks.

Hi Rajat, it's Mike. Well, I would tell you that obviously, we're having conversations with every OEM, and it's absolutely clear that the transition is completely inevitable. Our role in this, I think, is twofold. Firstly, to not just use our size and strength to be a really strong partner for our OEMs, but we also think that there's an opportunity to build out on our mobility side that we're focused on, and in quarters to come you'll hear more about that as part of the business model that we're developing. From an infrastructure perspective, I've already talked about the fact that we're making significant investments to have our buildings ready from a charging point of view, which will create two things. Firstly, in each individual location, we will provide opportunities for customers to charge, but we'll create our own network of charging stations effectively within AutoNation. We are doing that in many instances, in line with or in advance of some of the requirements. We're also working in terms of training because we recognize that while the sale of an electric vehicle on paper looks like it may go through the same steps, the reality is that we experienced from talking to European dealers with advanced experience with this, that the sales process itself is much more involved and much more educational. So, we're ensuring that we are trained on both the front end with our sales executives and technicians as well. We're in discussions because the fact is that the hurdles for the OEMs, I think, are high in terms of penetration rates, and the best way to get there is to be part of the solution for them, and that's our intention.

Got it, great. That's helpful. Maybe just last one on F&I. Obviously, we'll hear more around CIG and the impact on the finance business. But I just had a question on service contract penetration. It's gone up quite a bit since pre-COVID. If you could give us a sense of where we are today and how do you see that sustaining once consumers maybe start to get a little more disciplined with their spending? Thanks.

Thanks, Rajat. Well, candidly we continue to see success primarily in the product side. If you look back historically, at one point, we often talked about 60% of the composition of our CFS being product; that's now above 70%. We see the penetration increasing, on average, in excess of two products per customer and we see profitability increasing as well. So it appears from everything we see, on a sequential year-over-year basis, the demand continues to be strong because people see the value in it. We are obviously looking for ways to continue to improve that portfolio. As we mentioned, the acquisition of CIG is just complementary to an already strong piece of business. So we see it as a very positive trend, and one that is growing because the customer sees value in the offerings we have.

I'll just add a couple of points on that. As we've talked about before, one of the biggest assets that AutoNation has is our detailed and growing customer base of over 13 million customers. We know which of those customers are active. With predominantly franchise businesses, we would see a similar decay that you see in the industry as customers migrate to different channels. What we can do is to retarget some of our customers and ensure they stay with us, representing a significant opportunity and a great way to grow this business further from the product side.

Understood. That makes sense. Thank you guys for all the color and good luck. I will get back in queue.

Thank you. Our next question comes from the line of John Murphy of Bank of America. Your line is now open. Please go ahead.

Good morning, guys. Just three quick ones. First, on the CIG acquisition. I'm just curious what kind of competition this may create for your existing lender partners and if there may be any kind of pushback there. Ultimately, is this more of an AutoNation USA used vehicle underwriter, or is this kind of a full-service company that you're intending to build? And what kind of size or penetration level do you think you'll get to CIG? Is it a 5%, 10%, 15%, 20% penetration of vehicles sold? I'm just curious how you're thinking about this.

Yes. We've been very clear internally as we thought about this; the focus initially for this organization is to be part of the growth story for AutoNation USA. Our rollout plan for that business is aggressive. It's already growing significantly. I said we're going to open another store in the third quarter. When I think about the scale and overlap of this organization, it brings everything we need for it to be a strong partner for the growth of AN USA. One of the things that I touched on before is our partnership with our OEMs and the use of their finance companies; this will continue to be a focus for us in our franchise business. This is a separate business line, and that will be our approach. I believe we should be able to build to penetration levels of around 40% plus in AN USA once we accomplish two things. First, today, we have about a 70% coverage in terms of licenses and footprint; we will build that out in the balance of the year. Second, we have a great partnership with existing businesses in AN USA, which we intend to support. We should also note that we have a technology capable of scaling with experience in underwriting and securitization, which was important to us. This business is perfectly primed to scale with AN USA initially, and as things develop, we'll obviously discuss that in the future.

Okay, that's helpful. And then just a second question around SG&A. Performance was very good in the quarter. It's been very good for a while. I'm just curious, as volumes ultimately recover, whenever that is, probably late this year or sometime next year because of supply coming on, do you think you can hold sort of these levels in the mid-50s, or are we kind of going to drift back to the 60% range, plus or minus? What is sustainable on SG&A as a percent of gross, or is there a number that we should think about as more of just an absolute dollar number to model going forward? It's just a big leverage point that's been very positive for a while.

Yes, and that's, I think, as a result of Joe and many of the leadership team in the business, this has been an incredible positive trend for the organization, really started pre-COVID. Thankfully, I benefit from it being in place, and it's been extremely focused. If you look at our retail businesses, about 70% or 75% of the biggest cost in those businesses, which is obviously our biggest asset—our people—are variable. As our business scales, a significant portion of the cost in the business is related to that scale. That obviously also works if we enter a downturn in the opposite direction. There are parts of the business that represent opportunity for us. I've talked about after-sales and the fact that I would like to see improved penetration at the right time with the right leadership. We will be adding resources on a fixed basis. My expectation is you will see some slight growth as a percentage as we do some of that structural work. Joe is also very focused on keeping it under that number he keeps talking about. So anything you want to add?

Yes, I think we're finding a balance. We've made structural changes to the business, which will clearly sustain through any changes in the market. We have a very fixated mindset on how we continue to leverage the business. So we are going to make investments, as Mike indicated, that will cause a modest amount of pressure, but I think you will see us on a sustained basis well below pre-pandemic levels.

Okay. And then just lastly, on the consumer. Obviously, there are lots of crosscurrents and conflicting signals regarding the health of the consumer. You guys are dealing with these folks daily in your dealerships. What would you call the health of your consumer? If you could think about your backlog of orders or wait times on vehicles, maybe you could give us some metrics or even anecdotal data to understand how tight the market is and how strong or not strong the consumer may be.

Yes, I'll start on that. I think there are different pockets that I would talk about. If you take new vehicles across our three, let me call it, divisions of domestic, import, and premium luxury, obviously, demand is strong. Inventory levels are still incredibly low, high turn rates, and sustained margins over the last few quarters. In the first quarter, I reported that about 50% of our incoming three months' inventory was sold. I would say that on the domestic side, that is now down to about 35%. On imports, it remains sustained, and on premium, it is also largely sustained. On the domestic side, it's really due to some improved flow, but we will have to see how that continues because supply is still a big variable where we're not entirely stabilized, even at lower levels. On the used side, as I mentioned, our used volume was down. We weren't down as much as the industry was, but still, I wasn't particularly pleased with that. When we look at that in detail, all of it is in the sub-$20,000 category. The $20,000 to $45,000 range is flat with high close rates, and above $45,000 is slightly up year-over-year, again with high close rates. Historically, that sub-$20,000 price range has made up about 40% of our business, which is more than many of our competitors. I think we can rebalance and push some of that with better performance in our mid-price brand and address what I anticipate will be continued pressure at that price point. We are seeing increased interest rates being passed on to consumers because that's a question we've been asked. I would guess about 50 basis points has been passed on at this moment in time. To mitigate that, what we've also seen is that the average length of loan has already extended by one month. Though that may not seem significant, it is the average length of loan across our portfolio. We're getting other levers pulled to keep monthly payments balanced, but there is pressure on sub-$20,000 vehicles, which I'm confident the team is very focused on addressing to change our mix and mitigate our impact. Joe, do you want to add any more flavor on that? Obviously, we are very pleased with after-sales, and I can say I think miles driven have increased, and that combined with our team's focus has helped us there, which I believe will continue for sure.

No, I think—and that's driven by the customer base, which has done very well. The only thing I would put in context is that Mike talked about the preorder levels. Pre-pandemic, that was 5% to 10%. So we are still at extremely high levels, indicating both demand and availability.

So would it be fair to say that you see a tiny sequential erosion in the strength of the consumer, but the consumer is still strong relative to pre-pandemic levels and relative to supply? Is that a fair way to characterize that?

I think it is. I think that's very fair.

Thank you. Our next question comes from the line of Daniel Imbro of Stephens. Your line is now open. Please go ahead.

Yeah, good morning, guys. Thanks for taking our questions, and congrats on the quarter. I wanted to follow up on the used business and really the trade-off between inventory in GPU. After Q4, you guys sacrificed some GPU in Q1 and drove stronger comps. This quarter, it looks like comps were a little bit lighter than expected, but GPU stepped up, but we ended the day back at 40 days of supply. I'm curious what the optimal day supply is you're targeting there. Would you expect to work that back down in Q3 if you give back some GPU, or how are you thinking about that trade-off in this environment?

Yes, this is Mike, Daniel. For me, it's really simple. It's about your turn rate. It's how fresh you're able to keep your day supply. With the demand levels that we've got, I'm comfortable with where our day supply is right now. We constantly work on our analytics to ensure it's in the right place from both the price and product perspective, without incurring too much logistics costs. We mentioned in Q1 that we were working on aging because we had pockets of aging, which we completely removed. We have fresher inventory in Q2 that's going to flow over into Q3. If we look at the momentum we ended Q2 with, it has continued into this month. I think sequential comps are more limited this year rather than year-over-year comps because last year was very unusual as used car prices were increasing. The value of the inventory on our lots was going up while the cost remained fixed, which caused our margins to increase. We are not in the same dynamic now. We are seeing much more traditional movements of prices in the used market.

That's helpful. And then maybe moving to the new side. I had a question on the supply backdrop. Within premium luxury, you guys have decent exposure to some of those German brands. Are you hearing anything from them around how this energy shortage potential issue is going to impact production? Seeing headlines about 15% national reductions in energy use, could that be another headwind to vehicle production and inventory building, or any change in visibility from those OEM partners?

No.

And then last follow-up on CIG. It sounds like it's small today but growing. As this grows, will it tie up more capital as you build the loan book? Does that impact your ability to do share repurchases or deploy capital in other parts of the business? What are the capital needs of that as it grows?

Well, that’s an interesting question. We spent some time discussing how we think people should consider scale regarding this. What we wanted was a broad-based book. We acquired all of the capability needed at a relatively low entry point that comes with low risk. When I think about scale, we bought this in a very different way. What we wanted, as I said, was proven team capability, technology, experience, a track record through cycles, and great coverage that matches ours at the lowest possible entry point because we're focused on capital deployment. I believe Joe and the teams did a great job. Joe, do you want to address that?

Yes. I would refer to a number of points we've tried to make in the course of this call and the announcement to indicate a bit of our intention. One, Mike has reinforced the size of the book and the ability to have a proven securitization process. We fully intend to do that to minimize the amount of capital that we're deploying. We also were very deliberate in the share repurchase announcement. I hope that reinforces our commitment to balanced deployment. Share repurchase has been valuable to us and appreciated by our shareholders, and we will maintain that balance going forward. So, I don't expect to see significant changes in that.

That’s great. Mike, Joe, thanks for the color, and best of luck going forward.

Thank you. Our next question comes from the line of Adam Jonas of Morgan Stanley. Your line is now open. Please go ahead.

Hey, it's Adam Jonas actually on for Evan. I believe it's Silverberg, but I like Silverman; that sounds nice. Hello, everybody. I just got a couple of questions. Mike, I'm curious about what percentage of your sales across all your stores are preordered right now and how that's trended. I'd love any color on where you see the order-to-delivery time; are your customers having to wait longer than they did a few months ago, shorter, or is it kind of stabilized in terms of that order to delivery time?

Actually, Adam, we're switching; it's Joe on for Mike.

Hey Adam, how are you?

Let me give you some perspective on the buckets in the preorder and then I'll give you a little bit whatever I can on the timing. So preorder, if you go back, domestic Q1 was about 50%. As Mike referenced, that's probably 35 to 40; that's going to vary, but again, you see a little bit of contraction there. Import, we mentioned Q1 was 50%; it's about 50% today. We really have not seen a significant deterioration there. Luxury was up 70% at Q1; it’s 60%, 65%. It’s down just a tick, and those are all significantly above kind of pre-pandemic levels. So again, demand remains. I think the comment made earlier indicated a slight downtick, but it’s still remarkable in the absolute sense. As far as delivery times, I would say—and it’s obviously going to vary—not just by brand and by model. I would say there’s been some slight improvement, but nothing that I would want to highlight; it’s probably still larger than people appreciate. So, have not seen a notable change there that I would want to call out.

Adam, I just want to follow up on one thing. If you look at our closing inventory sequentially, it’s up slightly, and that, when you dig into it, was purely a timing thing from our perspective because we've got some inventory delivered to our dealerships that there was not enough time for us to prep them properly and get them to our customers. I can tell you that they were delivered very early in the following months. I don't think anything really to read into that at this moment. And if it changes, obviously, in the next call we can talk about it.

Great. Mike, I just want to follow up on this, you can take a stab at it, you can give it to Joe, or do whatever you want. But, given your experience at the OEMs, I would value your insight. Your margins and those of your peers on the new side have kind of tripled over the last couple of years. The operating margins in North America of the producers of the vehicles have been kind of stable, maybe up a bit. So, why aren't the OEMs increasing invoice prices when I talk to dealers, and I say, why don't these guys—the OEMs have to pay a massive UAW Bill next year; it's going to be like a historic increase. You guys are crushing it. They're kind of hanging on; they're going to start cutting tabs soon. Why aren’t they taking—why aren’t they repricing some of the stuff on those preorders? The answer I tend to get is they don't know what they're doing. They can't do it, or there's laws or just—they're not organized enough. I don't really buy that, but I'd love your view, Mike, what's going on, or are they repricing a bit?

What I see is something slightly different. The net price back to them has increased because of the work they’ve been doing on the incentive front. The last time I looked at that, a couple of things happened. So a lot of the incentive subsidies on leases have not been completely taken away, but it’s been reset, effectively increasing our lease MSRP. A number of the programs supporting retail business were either reduced or removed, which increased the net price back to the OEMs. That should be a pretty easy number to look at. That’s the first perspective. The OEMs took the opportunity to reset the net transaction prices of their vehicles, which will have a consequential impact on the residual values and under the long term is a very strong move from the OEMs, notwithstanding your point is well made regarding some of the costs that are going to hit the business. I haven’t looked at it in that detail from their point of view in a couple of months, but next time you’re in town, we can look at it together.

Look forward to that. Thanks, Mike, thanks, Joe.

Great, thank you. And again, thanks for your time and for coming to the call. I really just want to end with the comments that I made; it's great for Joe and me to talk about a record quarter. The fact of the matter is, with the large number of dealers we have and the large group of people working every day, it's down to them. I'm going to end by thanking them again—all of the 22,000 people that work at AutoNation. I think, notwithstanding the things happening in the industry and the economy, this is the eighth consecutive record quarter for the team, and that deserves my recognition every day. So I know a lot of the guys and girls are listening to this. I want to thank you for your commitment to our customers, each other, and particularly the communities through our Drive Pink campaign. Thank you for what you do. Let's keep it going.

This now concludes today's conference call. You may now disconnect your lines.