Welcome to LGI Homes, Inc.'s first quarter 2025 conference call. Today's call is being recorded, and a replay will be available on the company's website at www.lgihomes.com. After management's prepared comments, there will be an opportunity to ask questions. At this time, I'll turn the call over to Joshua Fattor, Executive Vice President of Investor Relations and Capital Markets.

Thanks, and good afternoon. I'll remind listeners that this call contains forward-looking statements, including management's views on the company's business strategy, outlook, plans, objectives, and guidance for future periods. Such statements reflect management's current expectations and involve assumptions and estimates that are subject to risks and uncertainties that could cause those expectations to prove to be incorrect. You should review our filings with the SEC for a discussion of the risks, uncertainties, and other factors that could cause actual results to differ from those presented today. All forward-looking statements must be considered in light of those related risks, and you shouldn't place undue reliance on such statements which reflect management's current viewpoints that are not guarantees of future performance. On this call, we'll discuss non-GAAP financial measures that are not intended to be considered in isolation or as substitutes for financial information presented in accordance with GAAP. Reconciliations of non-GAAP financial measures to the most comparable measures prepared in accordance with GAAP can be found in the press release we issued this morning and in our quarterly report on Form 10-Q for the quarter ended March 31, 2025, which we expect to file with the SEC later today. This file will be accessible on the SEC's website and in the Investor Relations section of our website. I'm joined today by Eric Lipar, LGI Homes, Inc.'s Chief Executive Officer and Chairman of the Board, and Charles Merdian, Chief Financial Officer and Treasurer. I'll now turn the call over to Eric.

Thanks, Josh. Good afternoon, and welcome to LGI Homes, Inc.'s earnings call. During the quarter, we continued to see strong demand for new homes. Families across the country are excited about the possibility of home ownership, and the lack of existing inventory combined with our ability to offset persistently high mortgage rates through compelling financing incentives is drawing customers into our information centers. However, affordability remains the biggest challenge for buyers, and rate volatility affects not only their ability to purchase a home but also their confidence in moving forward with that decision. Against this challenging and uncertain backdrop, we're pleased with the solid results we delivered in the first quarter of 2025. As we noted in our last call, higher mortgage rates in October and November weighed on our year-end backlog, and with rates rising further in January, the first quarter got off to a slow start. While February brought some improvement, the overall trend remained muted. However, in March, the pace materially improved, signaling a late start to spring sales activity, just as the quarter ended. As highlighted in our press release this morning, we delivered 996 homes in the first quarter at an average sales price of $352,831, resulting in revenue. During the quarter, we recognized a one-time expense related to the completion of our forward commitment incentive program that weighed on revenue and gross margins, as well as fees related to that charge that flowed through our G&A expense. We ended the first quarter with 146 communities, a 22% increase over the prior year. During the first quarter, our top markets on a closings per community basis were Richmond with 5.3, Charlotte with 4.6, Raleigh with 4.3, Atlanta with 3.8, and Nashville with 3.6. Congratulations to the teams in these markets and their strong performance last quarter. The improvement in lead and order trends in March enabled us to close out the first quarter with a strong backlog as we transitioned into the second quarter. We signed 1,437 net contracts in the first quarter and ended March with 1,040 homes in our backlog, representing over $406 million. Throughout our history, evidence has shown that training and time spent in role are the keys to new salespeople hitting standards and delivering their best results. As part of last year's rapid community count growth, we welcomed hundreds of new team members across every level of our organization. As these individuals enter their second year with LGI Homes, Inc., we're confident that their proficiency with our selling system and growing confidence will positively impact our results. Earlier this month, we welcomed our sales leaders to our corporate headquarters for intensive sales training that they will roll out to our sales teams across the country, setting the stage for a higher-performing, more agile sales organization. By reinforcing foundations, building belief, sharpening skills, and enhancing alignment with our core values, we're ensuring that our team is well-equipped to seize every opportunity that comes through our doors, particularly while the market remains challenging. Despite recent headwinds, we're confident in the long-term outlook for the housing market. The persistent shortage of entry-level homes across the country represents a societal challenge and underscores the importance of affordable, new residential construction. Underlying demographic fundamentals will only increase this need, setting the stage for a long runway of sustained demand for home ownership. These structural dynamics provide us with clarity and conviction as we continue to invest in our future growth. With that, I would like Charles to provide additional details on our financial results.

Thanks, and good afternoon. Revenue in the first quarter was $351.4 million based on 996 homes closed at an average sales price of $352,831. The 10.1% decrease in revenue year over year was driven by an 8% decline in home closings and a 2.2% decline in our average sales price. As Eric noted in his opening comments, we recognized a one-time expense of $8.6 million in the first quarter related to the completion of our forward commitment incentive program, of which $6.5 million was recorded as additional sales incentives in revenue. The decline in our reported ASP was driven by geographic mix, higher wholesale closings, and the one-time expense. Excluding this charge, ASP was essentially flat year over year. Of our total closings, 179 homes were through our wholesale channel, representing 18% of total closings compared to 9.4% last year. Our first quarter gross margin was 21% compared to 23.4% during the same period last year. The decrease as a percentage of revenue was primarily due to the forward commitment expense, an increase in wholesale closings, and to a lesser extent, higher construction overhead, lot costs, and capitalized interest as a percentage of revenue, as well as reduced operating leverage resulting from lower volumes. Adjusted gross margin was 23.6% compared to 25.3% during the same period last year. Adjusted gross margin excluded $8.3 million of capitalized interest charged to cost of sales and $809,000 related to purchase accounting, together representing 260 basis points compared to 190 basis points last year. Excluding the $6.5 million charge to revenue, gross margin and adjusted gross margin were slightly below the guidance range we provided on our last call but were in line with our expectations, which factored into typical first quarter seasonality. Combined selling, general, and administrative expenses for the first quarter totaled $73.5 million or 20.9% of revenue. Selling expenses were $42.3 million or 12% of revenue, compared with 10.5% in the same period last year. The increase was primarily related to higher advertising and personnel costs and was partially offset by lower commissions due to fewer closings. General and administrative expenses were $31.2 million or 8.9% of revenue, compared to 8.1% in the same period last year. Included in G&A was $2.1 million related to the buy-down expense. For the full year, we are maintaining our view that combined SG&A will be 14% to 15% of revenue. Pretax net income was $5.7 million or 1.6% of revenue. Our effective tax rate was 30.2% compared to 26.2% in the same period last year. The higher rate was related to the timing of the impact of compensation costs for share-based. We continue to expect our full-year tax rate will be approximately 24.5%. Finally, net income in the first quarter was $4 million or $0.17 per basic and diluted share. Gross orders in the first quarter were 1,016 and net orders were 1,437. Our cancellation rate was 16.3% compared to 16.8% in the same period last year. As highlighted earlier, we ended March with 1,040 homes in backlog, representing $406.2 million. Turning to our land position, at March 31, our portfolio consisted of 67,792 owned and controlled lots, a decrease of 3.4% year over year and 4.4% sequentially. Of those lots, 53,761 or 79.3% were owned, and 14,031 lots or 20.7% were controlled. Of our owned lots, 37,064 were raw land and land under development, with less than 30% of those lots in active development. Of the remaining 16,697 owned lots, 12,473 were finished vacant lots, and we had 2,702 completed homes and information centers. During the quarter, we started 1,176 homes and ended March with 1,522 homes in progress. I'll now turn the call over to Josh for a discussion of our capital position.

Thanks, Charles. We ended the quarter with $1.6 billion of debt outstanding, including $544.4 million drawn on our revolver, resulting in a debt-to-cap ratio of 44.3% and a net debt-to-cap ratio of 43.4%. Total liquidity was $360 million, including $57.6 million of cash and $302.4 million of availability under our credit facility. Yesterday, we successfully completed the recast of our credit agreement, extending our maturity from 2028 to 2029. Total commitments through 2028 will be $1.2 billion, after which total commitment will be $972.5 million through 2029. During the quarter, we repurchased 41,685 shares of our common stock for $3.1 million and ended the quarter with $177.7 million remaining on our current stock buyback authorization. Finally, our stockholders' equity on March 31 was over $2 billion, and our book value per share was $87.27. At this point, I'll turn the call back over to Eric.

Thanks, Josh. The slower start to the year was factored into the full-year guidance we shared on our last earnings call. Therefore, we remain confident in our original closing target of between 6,200 and 7,000 homes, 160 to 170 active communities by year-end, and an average selling price between $360,000 and $370,000. We continue to monitor tariffs and potential impacts that higher costs could have on margins. Beginning in March, we began receiving notices of price increases from some suppliers related to tariffs imposed to date, particularly those utilizing value-added components from China. With this in mind, we are proactively trimming our full-year gross margin expectations by 150 basis points at the low end and 100 basis points at the high end of our prior range to account for these additional costs and the potential for additional market uncertainty over the coming quarters. As a result, we now expect a full-year gross margin between 21.7% and 23.2% and adjusted gross margin between 24% and 25.5%. To conclude, I want to thank our team members again for their dedication and congratulate them on the results they delivered in the face of a challenging market. We deeply value our people, and being named a top Workplaces USA recipient for the fifth consecutive year is a powerful testament to how enthusiastic our team members are about being part of LGI Homes, Inc.

Thank you for your belief in our mission and your continued commitment to our company and our customers. We'll now open the call for questions.

One moment. Our first question comes from the line of Michael Rehaut from JPMorgan.

Hi. Good afternoon, everyone. It's Mike Rehaut. Thanks for all the detail and color as always. I was hoping to get a little more granular in terms of my first question on the gross margin trajectory that you've adjusted in terms of guidance. Specifically, how we should think about 2Q, 3Q, 4Q in terms of the cadence. And of the reduction in overall guidance, what is kind of related to the expected increase in costs related to tariffs as opposed to other drivers of the margin?

Yeah. Thanks, Mike. This is Eric. On the margin question, there's really three components to it. We started with the tariffs, and we've seen minimal cost increases yet. But there's no question we are getting letters from our suppliers with tariffs through surcharges that are going into effect in April and May. Right now, it's not a material amount. But it is a factor in our decision to lower gross margins. More than that is just the uncertainty of what will happen next week on tariffs or costs. We're still seeing costs generally increase when it comes to doing business with cities, various fees, and also the results of Q1, the gross margin was last. We thought it was prudent to take all that into consideration. We're leaning into incentives with our customers. Those are averaging 5% to 6% now of ASP, which impacts gross margin. So with all those things considered, we thought it was prudent for the end of the year gross margin to be adjusted.

Yeah. No. Appreciate that, Eric. I guess your comments also kind of lead into my second question, which is you said that you're maybe leaning into incentives a little more this past quarter. And I was curious, I mean, I think you said 5% to 6% just now. What that compares to maybe last quarter? How much of this is more related to when you think about what's driving the need to do that? Is it more just can buyers kind of maybe on the sideline amid some of the volatility going on here or other factors driving maybe a more competitive market? I know that you kind of said in your prepared remarks a lack of existing inventory across your markets as being a positive fundamental element of the housing backdrop. I just wanted to kind of circle back to that as well. And if that's at all part of what's driving the higher incentives as well or, in fact, to the extent that there is some inventory, that's also been a reason.

Yeah. I think incentives as a percentage is similar to last quarter. What we're doing on incentives, and we think we need to be competitive in the market. So the market dynamic is certainly playing a role in that. We don't think we need to be racing to the bottom as far as incentives go. But the three components are closing cost incentives, as most of our competitors are doing, something we've always done with our customers. Cash out of pocket is important for our customers, and we are incentivizing closing cost assistance. The second one is we're currently incentivizing with rate buy-downs, as most builders are doing. That trend continues. That's a big expense for LGI Homes, Inc. We're getting that fixed rate as low as we possibly can for our buyers because certainly an affordable payment and qualifying for a mortgage or sales prices today is as important. And finally, right now, the slower sales pace that leads to more finished inventory across our portfolio. And when you have more finished inventory, that leads to more price discounting or more heavily in incentives on the older inventory. So all those factors added up result in a heavier incentive package. The percentage is similar, but we're talking about what it's going to look like over the next two or three quarters. Obviously, it depends on the sales phase, but we thought reducing our gross margin was prudent.

Alright. Great. Thank you very much.

Thank you. One moment for our next question. Our next question comes from the line of Trevor Allinson from Wolfe Research.

Hi. Good afternoon. Thank you for taking my questions. First was on the midpoint of the full-year closings guide. I think it implies a roughly 3.5 absorption pace on closings. You did more like 2.2 here in the first quarter. So could you just talk about your confidence in accelerating pace the rest of the year to drive at that full-year target range, especially given some of the volatility we're seeing here recently?

Yeah. It's a great question, Trevor. I can start, you know, January and February were certainly sluggish. March sales were great. I mean, March sales were more in the four to five a month pace, which is fantastic. April, so far, has been a little bit more sluggish. Even last week sales, we gotta get in the loan application, but not as strong as April. We're going to close approximately 450 houses in April, which is more of the three a month cadence. Every month, January to February, February to March, March to April has been increasing closings, so we're trending in the correct direction. And yeah. No. We need to be in that four closings a month absorption pace for the rest of the year. If the rest of the year looks more like March than the first couple of weeks of April, we're going to be in really good shape. We're still seeing demand, so we're confident in our year-end closing guidance.

Okay. I appreciate all that color. And then the second question is more of kind of the pace and price trade-off here. You're taking down your gross margin estimates, guidance. Some of that is due to tariffs, some of that's due to market conditions. Should we interpret the adjustment as a view that the 3.3 absorption pace implied by the low end of your guidance represents a floor for you all, and that if demand were to soften, you would lean more heavily into either incentives or discounting to make sure you don't fall below that pace? Or should we think that if demand were to soften, it would play through a slower pace? How are you thinking about the trade-off between those two?

Yeah. So the other component on demand is our wholesale business. You know, it's 18% of our closings in Q1. So it depends on what percentage that flows through the rest of the year because we're willing to take a lower gross margin when we sell wholesale houses to our investor friends. So that will have a factor as well on gross margin. And then demand, you know, when we talk about demand at LGI Homes, Inc., it's how many leads that we're having come through our systems, how many inquiries we're having, how many people are going to our website. The good news for all of us is the demand is still strong. I would say we're having, you know, six to seven thousand inquiries a week, people looking to change their address, primarily getting out of a lease situation to homeownership. The challenge is in affordability. So we think demand is going to be there. It's just about getting the customer qualified, and that comes into the factors of what the tenure is doing, where's the mortgage rate market, and what is pricing doing? So we're going to keep an eye on all those factors very closely.

Thanks for all the color, and good luck moving forward.

Alright. Thank you.

Thank you. One moment for our next question. Our next question comes from the line of Carl Reichardt from BTIG.

Thanks for taking my questions. Eric, you talked about confidence related to rate volatility as a hindrance in Q1. That seemed odd to me, and I'm wondering if you're seeing confidence related to, say, worries about income, worries about costs, worries about savings, or the market. I'm trying to see how broad the lack of confidence is. We know rate falls impact business, but I'm curious if you're seeing it morph into deeper concerns when you talk to your sales team about the consumers they're seeing.

Yeah. I think, Carl, it's a great question. The first thing we look at is affordability and qualifying, like I said in the previous answer. But certainly, as homes have gotten more expensive, I mean, our average credit score for our buyers is around 700 now, last quarter in the 690s, with very good income and very good debt-to-income ratios. So we have a very strong buyer who is probably paying attention more to the market dynamics and the job market and uncertainty in the economy than our true entry-level buyer was from five years ago. I think that's playing a role. So general uncertainty, but the demand is there, you know, obviously, per market conditions. We talked about our five strongest markets on the call for Q1 closings. Those for us were all in the southeast. So on a closing volume, you know, Florida, Texas, and the west were not as strong. I guess that's playing into the market dynamic as well.

Great. Thank you, Eric. And then just on new community openings as you go, so two things. One, typically, I'm expecting that new stores are going to generate faster sales when they open, but at the same time for you guys, because the sales system's so important, training is so important to your folks, I think you said in the past sometimes it takes new salespeople at new communities a while to get ramped up. So between those two dynamics as you look out for this year, what are you expecting to see in terms of mix from new communities helping sales rate or improving salespeople as they get experience helping your sales rate?

Yeah. Those are both great comments, Carl, and probably should have been added to Trevor's comments on why we're confident in our overall year-end closing guidance. We've had a 22% year-over-year closing growth, we hired a lot of new people, a lot of new managers in the last twelve months. We expect all those salespeople to improve in year two in the business. That's been consistent for the last twenty-five years. Also, community count will be opening up. We do expect communities to get off to sometimes a fast start, sometimes a cautious start, but it will improve as the community gains more experience as well. The overall volume of new communities from 146 reported last month to the end of the year, 160 to 170. Those additional communities will help us achieve our closing target.

Great. I appreciate it. Thank you, Eric.

Thanks, Carl.

Thank you. One moment for our next question. Our next question comes from the line of Kenneth Zener from Seaport Research Partners.

Afternoon, everybody.

Good afternoon, again.

Alright. Look, obviously, 1Q came in below what had been a strong Q4 where you guys were confident your land model would be delivering those higher margins. You know, part of your long-term DNA. The street's obviously skeptical given the stock's valuation. So with it, you know, January and February were slow. March picked up. You're giving guidance sequentially. Right? And I think you can understand why people are, you know, given what other builders have been saying, skeptical of that. So it sounds like in reference to Carl's question, mix is playing a big piece of that. And then I wasn't clear if you gave or I guess I missed it if you did give the answer to the earlier question about is there a ramp-up in gross margins? Or is that kind of just the click-up occurs all at once and then we hold steady for the year? If you could just, that's a little broad question, but I was trying to get an understanding of where your confidence gets and clearly the market's, you know, lacking a little bit.

Yeah. I'll start, Ken, on the ramp-up of gross margin. I think gross margin will ramp up through the end of the year, primarily because we expect volume to ramp up through the year. I think the cost associated with gross margin, the incentives, I’d say are similar, but I think it will ramp up due to the volume component. Charles, do you have anything to add to that?

Sure. I would just add in terms of land management, how we're thinking about it, is that, you know, our acquisition pace has tempered as we're modeling to our current absorption expectations. We are working through our development spend as we are bringing on the communities that we just delivered in addition to the new communities that we expect to deliver into 2026. Development timelines continue to be elongated and take longer to get a development from the initial completion of engineering and design to getting the community ready and onboarded and ready for sales teams to be active. So I think in the first quarter, what you see is just the lower absorption rate kind of impacts that from a timing standpoint. As absorptions start to reaccelerate in the back half of the year, you'll see us recover more cash than we're reinvesting because our communities are delivering the sections. The timing of the next section is being pushed out and reevaluated. That just takes some time for that to happen. So two things: adjust the cash flow spend and then make sure we can get the homes delivered and into the sales process, and that just takes a little bit longer than I think you see in a single quarter.

Really appreciate that. And then I guess given your comment about gross margins going up partly due to higher volume, could you refresh us on what cost you have, I guess, in gross margin as a percent of sales? Like, is it, like, 3%? The sales are fixed in that COGS line, and then what do you expect your year-end inventory units to be? Thank you very much.

Yeah. Great questions, Ken. So included in gross margins, I mean, you're going to have capitalized overhead as the primary variable. So if you've got lower volume, the amount of dollars that come through related to construction-related costs, that’s typical when absorptions are lower. The percentage of revenue that is allocated based on the construction dollars is typically going to be higher. So that levels out through the year. That is not unique to 2025. That's really been the case. Why do we guide to lower gross margin for that? Yeah. I'm going to say over time, it's going to be somewhere around 30 to 50 basis points of improvement directly related to absorptions. They're obviously going to be tied to how much volume comes through and then staffing levels per community make a difference as well. But around 30 to 50 basis points.

Okay. And then year-end inventory thought? Thank you.

Yeah. Year-end inventory, I think we're trending to we ended the first quarter at about 4,200 units. So I'd say we're probably going to be somewhere in that range. A lot is going to depend on the timing of 2026 openings and what that outlook looks like. But I'd say we would end the year somewhere similar to where we are today, maybe a little bit more balanced in terms of we would expect our completed homes to be a little bit more balanced 60/40 rather than being a little bit heavier in completed units at the moment. But that is also typical in the first quarter as we move into the summer.

Thank you.

You're welcome.

Thank you. One moment for our next question. Our next question comes from the line of Jay McCanless from Wedbush.

Hey, guys. Thanks for taking my questions. The first one I had, you called out, I think, wholesale at roughly 18% of closings this quarter. I think that's probably the highest number y'all had in at least the last five or six quarters. Is there enough demand in the wholesale channel that if you needed to lean into that, that buyers are there to support that large of a percentage?

Yeah. Jay, it's there. I think it's very market-specific. And then that 18% number was on a pretty low overall volume number. So it certainly wasn't the biggest wholesale number we've had in our history as an absolute number, I don't believe. So I would say the wholesale appetite for houses, there's still a significant bid-ask spread difference. But the business is there for the right price, also very market-specific and even submarket-specific.

Okay. And then it was nice to see liquidity went up sequentially from the fourth quarter, and also like seeing the stock buyback. Could you tell us how much you have outstanding on the repurchase authorization right now?

Hey, Jay. This is Josh. Yeah. We currently have $177 million still outstanding on that. We saw that we did about $3.1 million last quarter. It was about 41,000 shares. Probably worth hitting on the point that the comment that Charles made earlier, right, when you're seeing a 2.2 absorption pace, and that's going to delineate where your underwriting criteria is for that period, it makes it a little bit more compelling for you to be going out and using some of that cash to buy back shares or obviously a nice arbitrage on that, so you should expect for us to put a higher priority on share repurchase in the future as long as we're, I think, today trading at a 36% discount to the book value we just reported, and so that's a compelling investment for our business.

Thanks. And then one more if I may. You know, Eric, I know you said at the beginning that the full-year volume guidance was predicated on a slow start to the year. And I know a couple of other people have asked about this, but maybe could you talk about where some of the openings are going to happen the rest of the year and are they in some of your higher volume markets or lower volume markets? Is there anything geographically besides just the volume of communities opening, something geographically that's going to help you guys get to the full-year closing guidance?

Yeah. I think it's more of the absolute number, Jay, than the geography and also replacement community. We're talking about net new communities. There's a lot of replacement communities coming online. We are opening a number in the Carolinas, which is a higher volume community for us. We're also opening quite a few communities on the West Coast, which is not necessarily higher volume, but certainly higher ASP and higher revenues. We're excited about those openings as well.

Okay. Great. Thanks, guys.

Thank you.

Thank you. One moment for our next question. Our next question comes from the line of Alex Barron from Housing Research Center.

You said spanky, Dylan? I wanted to ask, you know, some of your larger competitors who focus on specs and the affordable segment seem to be more focused on cutting prices these days. And I'm just wondering how you guys are responding to that. And, you know, what criteria do you use when you think about the need to cut price? That's my first question. The other question is with regards to the forward commitment. What interest rate, generally speaking, are you guys offering to buyers through that incentive?

Yeah. It's a good question, Alex. I'll start with the rate question. You know, we're buying down the lowest rate possible every week. So obviously, that changes and there are some market dynamics to it. Right now, we are buying down, and most of our customers are in the mid-fives for the FHA rate with good credit, which we think we can sell a lot of houses at the mid-five rates. But it also comes into price and all the other incentives. So, you know, we're leaning in incentives. We think it's really compelling, the value and the offering we're having for consumers right now. You know, discounting houses, it's something we don't do a lot of unless it's a standing inventory house. And then once the house has been in inventory for a while, that's another tool that we have. But our communities tend to be larger. They tend to have a couple of hundred houses per community. We're a little bit more cautious on doing steep discounts to the price. In a lot of cases, it's not necessarily as well.

Got it. Thank you so much.

Alright. Thank you.

Thank you. One moment for our next call. Question. Our next question comes from the line of Michael Rehaut from JPMorgan.

Thanks. Appreciate it. Just wanted to circle back to a couple of clarifying remarks, I guess, around margins. First off, you broke out the charge, I believe, of $8.6 million on the forward commitment expenses, kind of one-time. $6.5 million was in gross margin, I guess, through by virtue of the ASP. So they're obviously, we just want to make sure I have it right that the remainder would be in SG&A, the $2.1 million?

Mike, this is Charles. Yes. That's correct. $6.5 million in revenue and $2.1 million in SG&A.

Okay. And then secondly, again, just any thoughts around, you know, 2Q, 3Q, 4Q gross margin cadence would be helpful for modeling.

Well, I think, you know, it's gonna ramp up as we go because of the volume component. And Charles or I talked about that 30 to 50 basis points with that. And then we gave our annual guidance of 24% to 25.5% is where we're comfortable for the year-end rate.

Okay. Alright. So I'll work it that way. Thanks very much.

Thank you. Welcome.

Thank you. At this time, I'm not showing any further questions.

Thanks, everyone, for participating in today's call and your continued interest in LGI Homes, Inc.

This concludes LGI Homes, Inc.'s first quarter 2025 conference call. Have a great day.