Earnings Call Transcript - POWW Q4 2023

Operator, Operator

Ladies and gentlemen, thank you for joining us. Good afternoon and welcome to the AMMO, Inc. Full Fiscal Year 2023 Earnings Conference Call. All participants are currently in a listen-only mode. After today’s presentation, there will be a chance to ask questions. Please be aware that the audio of this conference call is being broadcast live over the Internet and is also being recorded for future playback. I will now hand the call over to Matt Blazei of CORE IR, the company’s Investor Relations firm. Please go ahead.

Matt Blazei, Investor Relations

Good afternoon, and thank you for participating in today’s conference call. Joining me from AMMO’s leadership team are Fred Wagenhals, Chairman and Chief Executive Officer; Jared Smith, President and Chief Operating Officer; and Rob Wiley, Chief Financial Officer. During this call, management will be making forward-looking statements, including statements that address AMMO’s expectations for future performance or operational results. Forward-looking statements involve risks and other factors that may cause actual results to differ materially from those statements. For more information about these risks, please refer to the Risk Factors described in AMMO’s most recently filed periodic reports on Form 10-K and Form 10-Q, the Form 8-K filed with the SEC today and the company’s press releases that accompany this call, particularly the cautionary statements in it. Today’s conference call includes non-GAAP financial measures that AMMO believes can be useful in evaluating its performance. You should not consider this additional information in isolation or as a substitute for results prepared in accordance with GAAP. For a reconciliation of this non-GAAP financial measure to net loss, its most directly comparable GAAP financial measure please see the reconciliation table located in the company’s earnings press release. The content of this call contains time sensitive information that is accurate only as of today, June 14, 2023. Except as required by law, AMMO disclaims any obligation to publicly update or revise any information to reflect events or circumstances that occur after this call. It is now my pleasure to turn the call over to Fred Wagenhals, Chairman and CEO of AMMO, Inc.

Fred Wagenhals, Chairman and CEO

Thank you, and good afternoon. I appreciate everyone joining us for our fourth quarter and fiscal 2023 earnings call. I would like to start this call by acknowledging all the hard work of our employees and the patience of our investors as we continue to navigate through a very challenging environment over the past year. While it's been a challenging period for all of us and the market in general, I firmly believe we have laid the foundation for the next great growth cycle for our company. I'm going to take a few minutes to highlight a few of these initiatives and then hand the call over to Jared to discuss these in more detail. During the past few quarters of global and U.S. economic downturn, which has impacted our market as well, we have been hard at work transitioning our customer base toward longer-term strategic clients, while also positioning the company as a long-term supplier of pistol and brass casings to OEMs in international markets. As the ammunition market normalizes, we will also continue our penetration into higher-margin niche markets with our proprietary technology and continue to press forward on our exciting government work. This pivot in strategy was designed to substantially improve the profitability of our pistol, rifle, and brass sales, while also reducing our working capital needs and improving the balance sheet. We are confident that these changes along with the significantly greater capacity at our state-of-the-art manufacturing facility in Wisconsin will put us in an excellent position to rapidly improve profitability as we execute in the coming quarters. Moving now to GunBroker.com. While brick-and-mortar retailers have suffered from a significant decrease in revenue and foot traffic, our GunBroker.com revenue and profitability have remained steady throughout the past fiscal year. We believe this has been a function of improved customer acquisition tools, significantly upgraded targeting, marketing, and a better overall customer experience, which the team has spent a lot of time and effort enhancing in every material way. As I have discussed on previous calls, we have undertaken a number of initiatives over the past year to enhance the GunBroker.com platform, including carting and credit card processing capabilities, which we are preparing to roll out as we continue the necessary and critical beta testing. Meanwhile, the massive layoffs seen in the technology industry have allowed us to expand our development capabilities as we leverage the increased availability of skilled workers to add a number of highly strategic hires. I remain confident that we are only in the early stages of what we believe will be a long runway of revenue growth and increasing profitability. We started the company in 2016 with the vision and mission to innovate and capture a meaningful share of the ammunition market, focusing on acquisitions, and always improving manufacturing operations while working to bring our customers the products they desire. We have grown by leaps and bounds in the short seven plus years, and I am proud of the future going forward, but there is much work left to be done, and we now have the team assembled to meet these challenges. At this time, I would like to turn the call over to Jared Smith, AMMO's President and COO. He will discuss these initiatives in more detail, review the current state of operations and what we believe the future has in store for AMMO, its team, and our shareholders.

Jared Smith, President and COO

Thank you, Fred. Good afternoon, everyone. This is my second time addressing you on an earnings call as President and COO. In these last five months, I have seen transformative change here at AMMO. I join Fred in thanking our employees for making these changes possible. Their dedication and wealth of knowledge continue to make great things happen and make calls like today all the more enjoyable knowing the great work we have accomplished. Before I dig into the business, our team and shareholders must take a look at our balance sheet. We ended our fiscal year with $39.1 million in cash, have eliminated debt, and generated $35.5 million in cash from operations over the past 12 months. We are well prepared for this downturn, and with the company repositioned its operations, we are ready to meet this new market head-on. Our sales and margins are down from 2022. We have retooled our factory and changed our go-to-market approach for both the ammunition and GunBroker.com divisions. 2023 and the first half of 2024 will be a challenging year for AMMO within this industry. As markets normalize, shelves are restocked, and our customers are once again looking for value as they tighten their belts. To thrive in this environment, we must create opportunities in the marketplace that build long-term relationships and communicate the value and strength of our platform and products. First, we want to focus on execution concerning the major process changes we have implemented, which may seem simple in nature, but provide a significant lift for a young and emerging company. These process improvements are essential in a tightening market and our requirement for repeatable margin growth during the continuing headwinds this sector faces. We've spent late nights and countless weekends developing these processes, programs, and new products to take this market head-on. Operationally, we have developed our sales and operational model, enhanced our sales and market forecast, tightened our purchasing plans, shortened feedback loops, and will continue with cost initiatives that will keep us lean and competitive in the quarters ahead. We have also aligned execution of those players with project management principles that will allow us to continue to monitor our execution and delivery on these key principles. Finally, we continue to add talent to our team and grow our people, and in turn our performance. Let’s talk a minute about GunBroker.com. GunBroker.com is about managing and establishing trust. The buyer trusts in this experience of buying a new or used firearm online without first handling it, trusting the assurance that a firearm will be shipped to the FFL undamaged and in a timely manner, following all the necessary state and federal regulations. The seller must trust that the funds settle accurately and in a timely manner, and they must trust that the transferring FFL will handle the firearm transfer experience professionally for their customer. For non-firearm purchases, trust must exist that the product being delivered is in the same condition as noted in the listing by the seller, and that the payment process is quick upon bidding or buying the selected item. It is that trust that we are building upon today. I trust that our community understands this is not a light matter and our developers and managers recognize that we must get it right. As we've discussed in the past, with the onboarding of credit card processing and carting, this platform will change, streamline, and expedite processes within the systems, and we must do everything in our power to ensure that we keep the trust of this community. To ensure that we continue to bring value, we must provide new tools and advancements that empower buyers and sellers with a deeper level of engagement within the community. The first major advancement was transitioning from a universal to a unique approach in our marketing campaigns. We shifted to an in-house team that generates campaigns around GunBroker.com's individualized, quantified, and internally generated data. This resonates with our customer base and enables us to hit unprecedented metrics as buyers discover new sellers on the platform around these personalized and self-selected genres. We are aware of no other competitor in our space that possesses and deploys this data in this method. This has resulted in 126 targeted unique customer personas that are curated and used in banner and email campaigns directing traffic back to those curated items by our sellers. This campaign also generates 1.5 million emails daily to an active and engaged audience segmented from an overall list of 3.5 million opt-in subscribers. The second major advancement was shifting from a reactive to a proactive approach on customer service, seller engagement, and industry relationships. By restructuring our customer service and adding product specialists, we have unified our outreach to both the seller and buyer community, leading to better navigation within the platform. We have accelerated customer response times and significantly increased our satisfaction ratings. The third major advancement of our marketplace was enabling buy-now links for manufacturer sites and manufacturer stores within GunBroker.com, which are fulfilled by our sellers' inventories. We've also recognized and helped draw out one of the core strengths of the marketplace, which is that sellers can exceed normal industry margins on rare, highly sought-after, and collectible goods through the auction process. This has become clear to our seller community and has been a topic of much conversation, which we will continue to educate our user base on through a new podcast launching in July. This podcast will be filled with conversations around fun facts, demystifying consumer selling and buying, and historical relevance of the products that can be found on GunBroker.com. We're also very excited to announce the newest member of our management team, industry veteran Alan Faulkner, Vice President of Public Relations and Brand Management. In this role, Alan will help bring awareness and retention to GunBroker.com and the ever-growing number of programs and services it offers sellers and buyers in the outdoor industry. As a whole, the entire GunBroker.com team feels they are truly hitting their stride, with the past two years focused on this strategic planning and development of what is now being deployed, bringing a whole new breadth of services and opportunities to the platform and its users. I'd now like to transition to AMMO and the ammunition division. Despite the current recessionary and inflationary macroeconomic effects, the ammunition division still benefits from geopolitical events and conflicts that you read about in the news today. Demand for our brass lines is growing and the word is getting out there that AMMO, Inc. is open for business and has significant capacity for its growing customer base. We are securing new foreign and domestic contracts for rifle and pistol brass just as we anticipated, and our international clientele will secure supplies that will carry them through the next election cycle versus being cut off when the domestic market rebounds here in the U.S. To make these opportunities a reality, we had to go back to the drawing board and clear out our cabinets, purge our old inventories, and lean out our processes. We've reduced our working capital requirement and continue to work through slow-moving inventory that clutters the mind and the factory floor. Our continuous improvement projects will create an even leaner operating model in the months ahead, as we process material after the consolidation of our two facilities last fall. Our sales teams are also busy implementing strategic account management, which focuses our energy and resources on the highest-performing dealer, retail, and distributor customers in this space. We must continue to tune ourselves in marketing organizations to listen and understand the requirements of our dealers and retailers, and effectively communicate our core strengths and strategic offerings. At the same time, we must create a conversation with our consumers who are getting lost in the aisles and options to choose from in the ammunition category. We will do this by rebranding and packaging the AMMO, Inc. signature lines to stand out on the shelf. This will communicate the strength of our best-in-class brass we manufacture, and the highest quality of components we source from other premium U.S. manufacturers. We are superior and take great pride in being a U.S. manufacturer based in Manitowoc, Wisconsin. As we transition our future product offering, we will continue to move our products into stable niche markets with loyal customers. Over the last six months, our AMMO division has transitioned away from top-line revenue and focused on margin creation in conjunction with contractual growth with our premium OEM partners. Sales margins improved, volumes stabilized, and strict inventory reduction plans have been put into place. We are filling in the factory that came online last fall and continue to see machine efficiencies increase while we find new demand for this capacity. We will continue to build out our sales and marketing teams to move the needle in a profitable and sustainable manner. Domestic markets will not keep our factories full, military needs are sporadic and timing is unpredictable, international business will not save us, even with the current conflicts raging beyond our borders. We must take a balanced and multi-disciplinary approach and strategically place our business with clients that are monitoring and measuring their business with the same care and diligence with which we measure ours. Strategic account management is based on the principle that we will find sales with credible clients, with a similar focus on the bottom line and the ability to market their brands with the same effectiveness that we will market ours. Sales have come rather easily in the past three years with COVID, and the U.S. and initial industrial base has grown. We will now have to prepare ourselves with strategies to compete with this excess capacity and lean our operations, creating efficiencies to compete with manufacturers that have been in this business for over 100 years. We will automate what we can, but automation takes time. Our strategy is differentiation and caliber selection, to engage our people, cut costs, and manage our relationships both domestically and internationally, militarily, all while hoping for a little luck along the way. We abide by the wise words of Thomas Jefferson, 'I'm a great believer in luck, and I find the harder I work, the more I have of it.' The entire AMMO team feels the exact same way. Our industry has grown its inherent capacity beyond pure consumption. Bigger factors like political cycles, regulation, and international and domestic turbulence drive this market to unprecedented levels. These factors must be managed and weighed. As the sales management team leans into the market, we will take all these factors into consideration as we build shareholder value through steady and predictable growth. I'd now like to turn the call over to Rob Wiley to discuss the quarter.

Rob Wiley, CFO

Thank you, Jared. Welcome everyone. Let me now review our fourth quarter and fiscal year 2023 financials in more detail. We are pleased with the progress we have made to date as we continue with the transition period, but headwinds are still active in the market today along with the rest of the industry. We remain excited about the new direction of our two segments, as we are nearing the end of our first quarter and our 2024 fiscal year. As observed by the peers within our space, we continue to see margin compression on our ammunition segment. The U.S. commercial ammunition market continues to slow from the inflationary impact and global recessionary drivers being felt across most industries. However, our plans to recoup cash tied up in our inventory and accounts receivable have gone according to plan, as we ended the year with cash generated from operations of approximately $35.5 million. We were able to reduce our total inventories by $12.8 million in our fourth fiscal quarter as we shifted our direction towards a leaner operating model focusing on increased brass sales, which afford us higher margins. Additionally, we continue to push forward with improvements to GunBroker.com, and expect the payment suite and cart platform to launch in our 2024 fiscal year, which would drive growth and profitability to the site. We ended our fourth quarter with total revenues of approximately $43.7 million in comparison to approximately $70.1 million in the prior year quarter. This was a decrease of 37.7% from the prior year quarter. For the fiscal year, total revenues were $191.4 million, decreasing 20.3% from the prior year. The decrease in revenue was mainly attributable to our ammunition segment and the inflationary impacts currently affecting the market. These market conditions also impacted the revenue of our marketplace segment, affecting a 7% decrease from the prior year quarter, and a 2% decrease from the prior year in total. However, the operating performance of our marketplace, GunBroker.com, still remains strong, and although our top line revenues wavered, our margins are still comparable to historical performance. Our cost of revenue is approximately $31.8 million for the quarter compared to $49 million in the comparable prior year quarter. For the full fiscal year, it was $136 million compared to $151.5 million in the prior year. This decrease was related to reduced sales volumes and increased commodity and overhead costs. Accordingly, this resulted in a gross margin of $11.9 million compared to $21.1 million in the prior year quarter and $55.4 million for the year compared to $88.8 million in the prior fiscal year. As our sales volume fell in the reported period, we are navigating a difficult climate as macro trends appear to be impacting our performance. We're transitioned to more profitable sales activity currently in effect for our first fiscal quarter of the 2024 fiscal year by shifting our focus to more sales of our premium brass and large caliber ammunition rounds. Our balance sheet remains strong, with our total current liabilities decreasing by 29% since our prior year end, and our total current assets virtually unchanged, but our cash position increased $15.8 million since the prior fiscal year, a 68% increase. For the quarter, we recorded adjusted EBITDA of approximately $3.8 million compared to the prior year quarter adjusted EBITDA of $10.7 million. For our fiscal year, our adjusted EBITDA was $26.4 million compared to $60.8 million in the prior fiscal year. This resulted in a loss per share of $0.03 for the quarter or adjusted net income per share of $0.03, in comparison to a net income per share of $0.00 in the prior year quarter or adjusted net income per share of $0.07. And for our fiscal year, a loss per share of $0.07 or adjusted net income per share of $0.16, in comparison to net income per share $0.27 or adjusted net income per share of $0.46 in the prior year. Looking forward to our next fiscal year, we expect a new direction of our company to increase profitability through increased sales of our brass casings and performance rifle ammunitions that will increase the gross margins of our ammunition segment. Additionally, the launch of our payment processing suite, cutting ability, and analytic offerings are anticipated to position our GunBroker.com marketplace to allow for increases in gross merchandise volume, and as a result, increasing revenue and profitability. Our common stock repurchase plan is underway with approximately 1 million shares repurchased in total under the plan thus far. The current plan is in effect until February 2024 with approximately $28 million in funds remaining under the plan. That concludes our opening remarks. I will now turn the call over to the operator for questions.

Operator, Operator

Thank you very much. We will now begin the question-and-answer session. Today's first question comes from Matt Koranda with Roth MKM. Please go ahead.

Michael Zabran, Analyst

Hey, guys. It's Mike Zabran on for Matt. I guess just starting with the AMMO manufacturing side, the press release says the transition to the more profitable sales activity is currently in effect. Just want to clarify here, does this mean we're fully switched over to the target production mix or if not, how far are we in that process? What does the rest of the transition entail and when can we expect that production transition to be completed?

Jared Smith, President and COO

Yeah. This is Jared Smith. I'll take that question. In terms of the product mix, we have fully transitioned. We still have capacity to bring on and we will be bringing on more and more capacity as we find additional sales. But in terms of product mix sales today, we're confident in the directions that we stated. I couldn't be happier with the team and the progress that we're seeing, long-term contractual volumes that secure factories like ours. Hope that answers your question.

Michael Zabran, Analyst

Right. Yeah. That's helpful. I guess switching over to GunBroker, maybe just start by speaking to some of the customer purchasing behavior, any observations and listing trends on GunBroker? And kind of how we expect those trends to pan out for the rest of the year?

Jared Smith, President and COO

One of the interesting things that have happened post-COVID is that while we've seen decreased traffic on the website, we're actually seeing increased profitability. And that's because during COVID, there’s this new base of sellers and buyers on the community that has been recognized, and we're seeing higher ticket items for sale on the platform. We're seeing better use of the listing options, and the overall percentage of sales has actually increased since the start of the year.

Michael Zabran, Analyst

Got it. That's helpful. One last question for me. Regarding the recent increases in take rates on GunBroker, are these changes being made in anticipation of expected improvements, or should we expect the take rate to decline as those improvements are implemented?

Rob Wiley, CFO

Hey, this is Rob Wiley. So the recent increase in our take rate is actually related to the increase in our average ticket size, which also relates to the ancillary off-listing options that come from those higher ticket items for sale. We have not increased our take rate related to any of the upcoming activity, and that would just be upside that will take place.

Jared Smith, President and COO

Yeah. I don't think we'll see a multi-tiered take rate until the end of this calendar year, but really into 2024. Right now, the goal is to continue to communicate, bring buyers and sellers on the platform, show and demonstrate the strength of the platform for getting a higher value for your firearms and increase the user community and awareness within these specific genres that drive the overall community and benefits for the user base.

Rob Wiley, CFO

With credit card and carting.

Jared Smith, President and COO

Yeah. And with credit card and carting, coming on in '23, '24, we've got nowhere to go but up.

Michael Zabran, Analyst

That makes sense. Is there a target take rate that we plan to end the year with and given the higher take rate, but considering sort of the AMMO down cycle that we're in, what type of growth are we expecting for GMB?

Rob Wiley, CFO

We have a high target take rate in mind, and we envision ourselves moving towards the higher end of the single-digit range. However, we want to ensure that any increase in our take rate is accompanied by added value for our users. As we continue to enhance our services, that would be the right moment to raise our take rate, but the growth in gross merchandise volume will depend on market activity. Therefore, it's challenging for us to provide a specific number on that.

Jared Smith, President and COO

And our increases in take rate are really related to the carding capabilities and bringing in a larger assortment of items that have higher margins. Right now, our goal is to keep the volume on the platform, keep the sellers happy. I don't see us adjusting our take rate on firearms in the '23 calendar year. But what's happening, and Rob alluded to it earlier is that through listing fees, inventory sitting a little bit longer, things are cycling over, people are seeing that the value of the listing options and different abilities to enhance your product on the website, those are really what's driving our increased take rate over the last three to six months.

Michael Zabran, Analyst

Makes sense. That's all from me guys. Thanks.

Fred Wagenhals, Chairman and CEO

Thank you for your time, sir.

Operator, Operator

The next question comes from Mark Smith with Lake Street Capital Markets. Please go ahead.

Mark Smith, Analyst

Hi, guys. First question is just kind of big picture and it's a little bit follow-up, but just as you guys get pretty good insight into the consumer and consumer trends and you spoke to some of that here that you saw in the quarter. Any update as we look at Q1, any updates in consumer behavior that you can speak to, whether it's you're broadly from your GunBroker data or even within ammunition?

Jared Smith, President and COO

So Mark, Jared Smith here. Within the ammunition sector, we're certainly seeing a decrease in demand. We're seeing price erosion on commodity products as we're seeing more imports into the U.S. market. I will tell you from AMMO's side is because we've moved away from those sectors and we're not trying to compete on the 9mm and .223. Our strategy is really about product differentiation, increased caliber growth, and servicing the OEM market. We think we're well positioned to go into the remainder of the year. And from a GunBroker.com side, the overall mix volume is pretty stable from what we've seen. But our consumers are looking for better value, and they're shopping harder, and we think GunBroker.com is one of the places that they're coming to shop and do comparison pricing. So while we may see a lower value or gross monetary value than 2022, we're seeing strong activity in the sectors that we want, which is higher gun value sales. There's still a very, very loyal base out there that goes to GunBroker.com to find the unique firearm that they're looking for. And as we add carding and credit card processing and increase our search capabilities, enhance our community engagement with a podcast and better tools and kind of dissect the genres of firearms and services and products that we have on our side, we really think that's where the consumer is going.

Fred Wagenhals, Chairman and CEO

I hope that answers your question, sir.

Mark Smith, Analyst

As we consider the shift in manufacturing, you've addressed this topic recently, but I'd like to explore it further. Could you provide an update on the transition towards producing more profitable calibers and rounds, particularly the move away from .223 and 9mm? Also, previously, Jared mentioned a return to supplying more brass casings to your OEM partners. Can you share the current status on that as well?

Jared Smith, President and COO

Absolutely. I'll address the second part of your question first. We have indeed made a transition, and while I'd like to take credit for it, the team in Manitowoc, Wisconsin deserves a lot of praise. They excel in brass rifle manufacturing, and I believe they are among the best in the industry. Our product mix is currently where we want it, and we are focusing on expanding our capacities in the medium and large rifle caliber segments. Our 50 Cal line is ramping up, and there is a demand for larger premium rifle calibers like 12.7 by 108mm and 50 Cal that has exceeded my expectations. I realize I started with the second question before addressing the first; could you please repeat the initial question?

Mark Smith, Analyst

Yeah. Just the shift in manufacturing kind of away from 9mm and .223 and into more kind of specialty calibers.

Jared Smith, President and COO

It was really just that simple. You walk over to the machine and turn it off. Then you redirect your purchasing plans along with your sales and operational strategies to where we continue to see margins at .38, .357, .44, and .45 long colt. Straight Wall Calibers and these product mixes allow larger manufacturers to have fully dedicated lines for 9mm, specific loading, bullet production, assembly, and drawing. We just don't operate that way in our factory, which enables us to shift and adapt quickly.

Mark Smith, Analyst

Can you provide an update on commodities, labor, and other inflationary pressures since the end of the last quarter, especially as we are now in the first quarter? What are you observing regarding inflationary pressures?

Jared Smith, President and COO

Yeah, absolutely. What we saw at the end of 2022 into 2022 was a continued and steady increase in raw materials, copper, and zinc going up, our labor costs increasing. I think as the recession set in, those are actually turning around and we've seen copper prices back off. So we actually have a good sign there in terms of our inputs. Primers are still in high demand, but there is additional primer capacity coming on both internationally and domestically. And just the lack of demand has created a little bit of slack in the primer supply. From a commodity standpoint, you're always going to have your imports flooding in because they've got to sell through those factories for the sake of military readiness. But fortunately, we don't have to play there, we don't have to compete there.

Mark Smith, Analyst

Perfect. Thank you, guys.

Operator, Operator

Today's last question comes from Edward Riley with EF Hutton. Please go ahead.

Edward Reilly, Analyst

Hey, guys. Just wondering if you can maybe give us some color on the cadence of gross margins in the ammunition segment throughout the next fiscal year, just given the strategy to maybe continue selling slower-moving inventory in the near term. When do you anticipate getting through that inventory, and what might gross margins look like within that segment when it's finally moved?

Jared Smith, President and COO

We're working through that inventory now, and what we're seeing is that we've improved margins by 10% to 15% in pistol. Going into the end of calendar year '22 into '23, we were nearly at breaking even on most of our rifle ammunition. A lot of that was imported and resold, but it was still heavily commodity mixed. So we turned those machines off, and we've set a 10% to 15%, and in some months, 17% increase in margins based on the mix that we're putting out that month. And we have grown our margin business by six-fold since January, where we're seeing 30% margins.

Edward Reilly, Analyst

Okay, great. Thank you for that.

Jared Smith, President and COO

Absolutely. We're excited about where we're going and I got to tell you looking back at where the company has come from and its quick short seven years, and including 2022 with a proxy contest and legal fees, we are off to the races in this '24 fiscal year. So appreciate it.

Operator, Operator

This concludes our question-and-answer session. I would now like to turn the call back to Fred Wagenhals for any closing remarks.

Fred Wagenhals, Chairman and CEO

Thank you shareholders and supporters of the company. I appreciate your support. I've watched Jared put together a phenomenal team over the past five months, and I have the privilege of attending the meetings and seeing where we're going in the next year. I said you're going to see some very exciting things out of this company. Thanks again for everything.

Operator, Operator

Conference has now concluded. Thank you for attending today's presentation. You may now disconnect.