Red Rock Resorts, Inc. Q4 FY2021 Earnings Call

Thank you, operator, and good afternoon, everyone. Thank you for joining us today for Red Rock Resorts' fourth quarter and full year 2021 earnings conference call. Joining me on the call today are Frank and Lorenzo Fertitta as well as our executive management team. I'd like to remind everyone that our call today will include forward-looking statements under the safe harbor provisions of the United States federal securities laws. Developments and results may differ from those projected. During this call, we will also discuss non-GAAP financial measures. For definitions and complete reconciliation of these figures to GAAP, please refer to the financial tables in our earnings press release, Form 8-K, and investor deck, which were filed this afternoon prior to the call. Also, please note that this call is being recorded. Now, let's take a look at our fourth quarter and full year results. On a consolidated basis, when excluding management fees, our fourth quarter net revenue was $422.4 million, up 32.9% from $317.8 million in the prior year's fourth quarter. Our adjusted EBITDA was $189.7 million, up 50.8% from $125.7 million in the prior year's fourth quarter. Our adjusted EBITDA margin was 44.9% for the quarter, an increase of 535 basis points from the fourth quarter of 2020. With respect to our Las Vegas operations, excluding the impact from our foreclosed properties, our fourth quarter net revenue was $416.3 million, up 33.5% from $311.8 million in the prior year's fourth quarter. Our adjusted EBITDA was $206.7 million, up 45.6% from $142 million in the prior year fourth quarter. Our adjusted EBITDA margin was 49.7%, an increase of 412 basis points from the fourth quarter of 2020. On a same-store sales basis, we achieved the highest fourth quarter net revenue, adjusted EBITDA, and adjusted EBITDA margin in the history of our company. Now let's turn to our full year performance. Please note that while we are comparing our 2021 full year performance to our 2020 full year performance, the 2020 results were severely impacted by the 79-day statewide shutdown of all nonessential businesses, including casinos, in an effort to reduce the spread of COVID-19 and by the restrictions on our business that followed and continue today. On a consolidated basis, when excluding management fees, our 2021 full year net revenue was $1.61 billion, up 46.2% from $1.1 billion in the prior year. Our 2021 full year adjusted EBITDA was $733.2 million, up 151.9% from $291 million in the prior year. Our adjusted EBITDA margin was 45.6% for the full year 2021, an increase of 1,912 basis points from the prior year. With respect to our Las Vegas operations, excluding the impact of our foreclosed properties, our full year 2021 net revenue was $1.58 billion, up 59% from $995.4 million in the prior year. Our full year 2021 adjusted EBITDA was $797.6 million, up 120.6% from $361.6 million in the prior year. Our full year 2021 adjusted EBITDA margin was 50.4%, an increase of 1,407 basis points from the prior year. On a same-store sales basis, we achieved the highest full year net revenue, adjusted EBITDA, and adjusted EBITDA margin in the history of our company. During the quarter, we continued to prioritize free cash flow, converting 52% of our adjusted EBITDA to operating free cash flow, generating $96.8 million or $0.90 per share. This brings our 2021 cumulative free cash flow generated by the company to $472 million or $4.39 per share, with virtually every dollar being returned to our stakeholders. Taking a look behind the numbers within the quarter, the government's mask mandate across the State of Nevada remained in place. We definitely felt the effects of that and increased inflationary pressure on ordinary goods and services. These factors offset customary fourth quarter seasonality and resulted in a reduction in visitation. Despite these factors, we experienced increased time on devices as well as strong spending per visit across our entire portfolio. Consistent with our experience earlier in the pandemic, the mask mandate and the recent resurgence of the Omicron virus most notably impacted our older guest segment. Despite these headwinds, we remain disciplined and focused on executing our core strategy, which allowed us to generate record revenue and profitability with our gaming segments in the fourth quarter. Turning to our nongaming segments, we saw continued growth in food and beverage and hotels, as both segments delivered their most profitable fourth quarter results on average. Regarding our group sales and catering business segments, these business lines continue to be slow to recover and felt the impact of the recent resurgence in the pandemic. At this point, while we are seeing our lead pipeline grow, business has been pushed back into the second half of 2022 and into 2023. As mentioned on our prior earnings calls, our financials are still carrying approximately $2.6 million of COVID-19 mitigation costs for the quarter and approximately $2 million in carrying costs associated with our closed properties for the quarter. On the expense side, we remain operationally disciplined and continue to look for ways to become more efficient while providing best-in-class wages and benefits to our team members and delivering best-in-class customer service to our guests. The company's actions taken over the past 7 quarters to streamline our business, optimize marketing initiatives, and renegotiate a number of vendor and third-party agreements have led to a significant transformation of the business, resulting in same-store revenue that exceeds 2019 pre-pandemic levels, higher adjusted EBITDA margin, increased adjusted EBITDA, and strong free cash flow conversion. On the technology front, regarding cashless gaming, we have successfully completed our field trial with IGT at our Red Rock and Green Valley Ranch properties and have begun rolling out this product to our remaining properties. We expect to have cashless gaming up and running at all of our properties over the next 2 quarters. While the initial focus is introducing cashless payments on the slot floor, the eventual goal is to allow customers to play and pay from one mobile digital wallet across all of our amenities at each of our Las Vegas properties. There will be more to come as we roll out this exciting product. Now let's cover a few balance sheet and capital items. The company's cash and cash equivalents at the end of the fourth quarter was $275.3 million, and the total principal debt amount outstanding at the quarter end was $2.89 billion. During the quarter, we further bolstered our balance sheet and increased our financial flexibility as we closed on our previously announced sale of the Palms Casino Resort and Palms Place for an aggregate purchase price of $650 million in cash coupled with the issuance of a $500 million 4.625% senior note due in 2031. We also successfully returned capital to our shareholders through a modified Dutch auction tender offer as well as the payment of a special dividend during the quarter. We continue to focus on long-term growth opportunities while also returning capital to our stakeholders. The company commenced a modified Dutch auction tender offer in November 2021. Through the tender offer, we purchased approximately 6.9 million Class A shares, representing about 10.1% of the Class A shares issued and outstanding or 6.1% of the total number of shares outstanding, assuming the exchange of all shares of the company's Class B shares and limited liability interest in Station Holdco LLC at a purchase price of $51.50 per share for an aggregate cost of approximately $354.6 million. In November 2021, the company announced that its Board of Directors had declared a special dividend of $3 per Class A share. The special dividend was payable to shareholders of record on November 23, 2021, and paid on December 22, 2021. During the fourth quarter, we made distributions of approximately $124.3 million to the LLC unitholders of Station Holdco, which included a distribution of approximately $74 million to Red Rock Resorts. The company elected to use its distribution to cover part of the modified Dutch tender as well as purchase an additional 389,000 Class A shares at an average price of $49.94 per share under its previously disclosed $300 million share repurchase program. Together with the modified Dutch tender, we purchased approximately 7.3 million Class A shares during the quarter at an average price of $51.42, reducing our share count at quarter end to approximately 107.4 million shares. Combined with our special dividend, we've returned approximately $703 million to our shareholders in the fourth quarter. Capital spend in the fourth quarter was $26.4 million and $61.3 million for the full year in 2021. For the full year 2022, we expect to spend between $75 million and $100 million in maintenance capital and an additional $300 million to $400 million in growth capital, inclusive of our Durango project. Now let's provide a short update on our development pipeline. Starting with our Durango development, we are extremely excited about this project, which is situated on a 71-acre parcel, ideally located off of 215 Expressway Durango Drive in the Southwest Las Vegas Valley. The project is located within the fastest-growing area in the Las Vegas Valley with a favorable demographic profile. The site provides convenient access off the 215 Expressway, handling over 166,000 vehicles per day, and is within a 5-minute drive to about 125,000 people. Furthermore, there are no unrestricted gaming competitors in the 5-mile radius of the project site. In January, we received our permits to begin construction of this project, and we have since broken ground. Anticipated construction will take approximately 18 to 24 months. When complete, the project will include over 73,000 square feet of casino space with over 2,000 slot machines and 46 table games, over 200 hotel rooms and suites, 4 full-service food and beverage outlets, a state-of-the-art racing sports book experience, and a resort-style pool. We expect to spend approximately $750 million, which includes all design costs, construction, hard and soft costs, preopening expenses, and any financing costs associated with the project. We have entered into a guarantee of maximum price contract for the early phases of this project with the expectation of approximately 70% of the total project cost being under GMP within the next couple of quarters. The company expects the return profile of this project to be consistent with past greenfield projects within our portfolio. Turning now to North Fork. When we last spoke, we noted that the tribe has favorably resolved all its federal court litigation. Since then, the tribe has settled its California State Court litigation, which stands for California, leaving only one pending case in the California courts. This case is with the Rancheria. Although that litigation remains active, we do not believe any decision by the California State Court could deprive North Fork of its ability to game on its federal trust land. As noted last quarter, we continue to progress with our efforts regarding this very attractive project, including development and design and initial talks with prospective lending partners. We will continue to provide updates on our quarterly earnings call. In conclusion, despite some headwinds in the back half of the fourth quarter, our disciplined approach to running our business allowed the company to enjoy record high EBITDA and EBITDA margin and to return approximately $703 million to our shareholders during the quarter. With our best-in-class assets and locations, unparalleled distribution scale, and our development pipeline of 8 strategically located gaming properties, we believe that we are uniquely positioned to capitalize on favorable long-term demographic trends with high barriers to entry that characterize the Las Vegas local market. Lastly, we would like to recognize and extend our thanks to all of our team members for their hard work and support and to our guests for their support throughout this pandemic. Operator, this concludes our prepared remarks today, and we are now ready to take questions from participants on the call.

First question today comes from Joe Greff with JPMorgan. Please go ahead.

We've been getting this a lot today. Last night, PayPal talked about seeing weakness in spend from their lower-income, lower-tier consumer. And so we've been fielding questions about that kind of segment in the casino segment. And I know it's a different business and not in gaming, but can you talk about what you're seeing maybe at that lower income, that lower price point consumer segment? Clearly, the fourth quarter results didn't reflect anything there. And if you can share with any kind of consumer trend change in what you've seen thus far in January and early February?

Joe, it's Frank. When we assess our business before the pandemic, we primarily focused on the mass market with heavy promotions. However, after the pandemic, we pivoted towards developing higher-end customer relationships, which is where we anticipate our growth will come from. In reviewing the fourth-quarter numbers, despite facing challenges from the Omicron variant in December and the ongoing mask mandate, we managed to increase our revenues by 33% compared to the previous year, which we view as a positive outcome.

And Joe, to be honest, I think to add on to what Frank was saying, from a long-term perspective, if we look beyond that quarter, just the long-term demographic profile of Las Vegas. We have more people moving into Las Vegas. Between 2021 and 2019, household incomes over $100,000 have grown approximately 19%. And if we actually forecast that out through 2026, it's expected to grow on average at a 6% CAGR. So I think the player development initiatives we are implementing here and our focus now are in the right place.

And I thought what was sort of interesting, Steve, was in the fourth quarter, you had casino revenues flat sequentially, but saw food and beverage room up sequentially and yet that resulted in higher margins sequentially. Can you talk about what you're seeing outside of the casino floor in terms of spend and any kind of expense pressure as we head into the balance of 2022?

Definitely expense pressure in the restaurants and the food and beverage side. But along with those increased costs, we've been extremely diligent in looking for every opportunity that we have to keep our food costs in line and not be underwater in the restaurants. Whereas before, we might have been looking at price adjustments once or twice a year, we're literally looking at what we have to do to manage costs on a weekly basis.

Yes. You mentioned the hotel for the nongaming segment. The good thing is we adjust the pricing daily, which helps us manage inflation. We're aware that the group business will take longer to recover, but our team has successfully prioritized more profitable gaming customers for the hotel, resulting in an additional $28 million in gaming revenue from that strategy.

The next question comes from Carlo Santarelli with Deutsche Bank. Please go ahead.

Steve, it seems as though, if you just look at it simplistically, OpEx in the second half is fairly stable. I think your implied OpEx in the fourth quarter for the Vegas locals business was up marginally. Do you feel like this is a level where it kind of plateaus, and this is more or less the go-forward base? Or are there other amenities that perhaps could drive that if it's inflation or just new amenities that could have revenue coming along with them from here?

From a new amenities perspective, going back to June of last year, we opened all of our amenities except for the buffet, unlike most of our competitors. Many of those fixed costs are already accounted for, so we are now focusing on incremental volume, which should positively impact margins. Regarding inflation, we are facing the same tight labor market as everyone else, leading to wage inflation. Our team is effectively managing labor and hours, which is why our payroll costs remained flat from one quarter to the next. Additionally, in response to Joe's question about managing the cost of goods sold, particularly in food and beverage, our team has strategically challenged menu pricing and raised prices where possible.

And if you look at the amenities, as Steve mentioned, there are no additional amenities that we're going to reopen that aren't open yet. From a volume standpoint, food and beverage is very healthy. Bowling is very healthy. The only area that has not returned to pre-COVID levels is movies. And I think traffic is about 50% of what it was in 2019. And there's room in hotels, but I think the theater obviously is driven a lot by just product not having as much product being released.

Makes sense. And then I know this is kind of a tough one to answer, and seasonality has been something that's been fleeting during the last 2 years. But I believe, historically, if you're just looking at kind of locals' revenue, first quarter tends to be maybe 2%, 3% stronger than fourth quarter over time. And Steve, just given your comment about some of the stuff, obviously, with the variance in the latter half of December, is that seasonality something that you expect to kind of return to more normalized ebbs and flows as we move into 2022?

Again, we cannot predict the future with certainty. You mentioned that government restrictions are still in effect and that the variant continues to impact visitation. However, as conditions improve, we anticipate a return to normal seasonality. We believe our older demographics will return just as they did in previous cycles during the pandemic.

The next question comes from Shaun Kelley with Bank of America. Please go ahead.

Steve, you brought up a couple of times the mask mandate and not holding you back and also the older demographic. I'm just wondering if you could go a little bit deeper, whether it's visitation down from kind of either pre-COVID levels or even from what you saw last quarter or just kind of the broader behavior pattern? And just give us a sense of how much this is costing you right now? Because I mean, again, the results being stable quarter-on-quarter are impressive in its own right.

Yes. I think when you look at visitation, if you kind of dig down on visitation, seasonality from Q3 to Q4, you actually expect what we've seen. If you look back at our prior 10, 15 years, when excluding 2021, generally, visitation is flat. And what we saw is visitation down almost 6%. And again, it was a tale of...

It was all at the end of December with the Omicron. I mean, our business really follows what that news cycle is. And when people get scared, and this time, actually, people are getting sick even on top of that, we would make our calls to visitations that we were missing. And in the past, it used to be that people were scared to come out or they didn't want to come out because they didn't have the vaccine yet or whatever, and this time, basically, the response was, I have the Omicron variant. And so I think that really did affect our business.

Absolutely. Shaun, to take it a step further, when we talk about the older demographic, nearly three quarters of the missed visits were from this group. We're confident about this because we experienced a similar situation a year ago when they returned once restrictions were lifted and the news became less severe regarding the virus.

This is Lorenzo, getting some more detail on your visitation. I mean, one of the things that we're really happy about is that our younger demographic, 21 to 35 if you compare Q4 2021 to 2019, it's up over 60% from a visitation standpoint. So we're continuing through the amenities we have in the properties or locations where the growth in the valley is, we're getting our fair share of what we think will be a very valuable demographic going forward.

Actually, Lorenzo, I think my follow-up is kind of right along that same line. So you mentioned obviously the favorable, let's call it housing and demographic trend if I think move-ins from other places that we know the benefits of flow taxes and all the other advantages of being there. Could you just give us a sense of like maybe when we look back on 2021 or whatever the right time frame is, how many new customers have you either welcomed into the Boarding Pass program? Or broadly, do you think you're seeing that or just people you haven't seen before? Because I think historically, this was a bit of a same-store model, but that tailwind could be substantial. Is there a way you could help us think about maybe the magnitude for that in your own business?

Boarding Pass sign-ups have increased significantly, with approximately 50% growth year-over-year. This healthy rate of growth is not only due to the overall expansion in the Las Vegas Valley, which is well-known, but also because of the strong performance in higher-income demographics. We're seeing about 19% to 20% growth for those earning $100,000 and above, and a similar trend for those earning $150,000 and above, along with a 6% compound annual growth rate projected through 2030. This growth will positively impact our business due to our strategic locations in areas like Summerlin and Green Valley, which are among the fastest-growing in Las Vegas.

And the development pipeline.

And we've got 8 properties, 8 undeveloped projects that we've broken ground on Durango. And we're working on all the entitlements and actually starting to lay out plans and timelines for the balance of those properties.

The next question comes from Stephen Grambling with Goldman Sachs. Please go ahead.

As that blip occurred, did you see any change in the promotional environment across the peer center? Do you think as a whole, the industry is just operating with less volatility? Or are you seeing any kind of broader shift in promotions?

No. I think that blip, I think you're referring to the December blip. No, we did not see any increase or any irrational behavior from our competitors. And in fact, from our perspective, we're continuing to optimize and refine our marketing because we're pivoting to the fact that we have best-in-class assets, best-in-class locations and a favorable Las Vegas demographic. That's what we're marketing.

It really wouldn't make any sense to go and spend promotional dollars into a situation where people are at home because they're sick. I don't think you would be able to move the needle. But we really didn't see any increase in commercial spend.

And then on the properties that are still closed, I guess, how are you thinking about the potential to either reopen those? And at what point or in what fashion could you ultimately even potentially monetize some of these assets?

Yes, it's a response consistent with what we've shared in previous quarters. We are consistently assessing the potential for reopening on a regular basis. We have made it clear that we will only reopen properties if we believe we can add incremental value to the overall portfolio. Fortunately, we've managed to capture about 94% of the fee or what we refer to as missing guests from before the pandemic and have been able to leverage that effectively with our existing six open properties. Regarding your second question about monetization, we need to address the initial reopening before we can evaluate that further.

Maybe one other one just on Durango. The $750 million looks consistent with what you've discussed before, but you've also talked about higher inflation. What level of inflation are you generally anticipating in that build? And are there any mitigating factors if inflation ends up being higher or even lower?

We're early in the process. It's Lorenzo speaking. We just broke ground and are currently grading the property. We have secured steel, which was purchased some time ago. We have also locked in concrete for the low rise and the parking garage.

And the tower.

And then you have site workers locked in under GMP. So that's locked down. Eventually, here in the near future, we expect to be up to 70% under GMP. We're already ordering things like kitchen equipment and other items you wouldn't typically order and have purchase orders out this far out from a project. But we're anticipating trying to mitigate any issues that there might be related to supply chain or inflation. I'm sure we'll experience some challenges. But we're, as of right now and today, very confident in the number that we laid out.

The great aspect of a GMP contract, Stephen, is that it transfers the risk to the builder. The builder, who is very capable, is working on Durango. He is definitely making contingency plans to address any potential inflation or unexpected issues that might arise during the construction of the project. However, if there's any unexpected risk that he does not foresee, that risk falls on him.

The next question comes from Barry Jonas with Truist Securities. Please go ahead.

I wanted to start on cashless. What kind of expectations or maybe aspirations do you have with cashless growing your spend per player on the gaming and nongaming side? And I guess with that, maybe talk about any impact you expect from Nevada approving remote registration.

On cash, I think it's still early. We haven’t launched our major marketing efforts yet because we wanted to ensure a seamless experience across our entire portfolio, allowing guests to enjoy the same cashless transaction technology at Red Rock as they would at Sunset. We plan a larger push once we complete the rollout. We anticipate that this will be well received, especially by younger audiences, and we expect growth to accelerate. Removing friction from the gaming floor is typically beneficial for business and encourages increased gaming spend. Regarding remote registration, this also aims to eliminate friction from a cashless standpoint, which should support our sign-up rates.

And then just as a follow-up, I want to kind of ask about your excess land bank. Anything you're actively marketing? Or I guess, could we see any sizable land sales this year?

Yes. I mean, we have the 8 development sites. So we're looking at all of them and trying to determine which are strategic and which are non-core. And our phones are always accepting inbound calls, which we get constantly, particularly given the scarcity of land in Las Vegas. So this portfolio is only getting much more valuable over time. In Q4, we did close on our Mt. Rose site. So we did sell the Mt. Rose site for $32.6 million. And so that was, I think, a good end to that transaction. We look forward to more to come.

The next question comes from Dan Politzer with Wells Fargo. Please go ahead.

I just wanted to follow up on the commentary you gave on the additional development for parcels. I mean can you kind of outline, obviously, after Durango, how you look at the relative attractiveness of some of those parcels and which ones you'd maybe look to develop sooner than later?

Yes. I mean, we're still in the process of trying to figure out what is going to be next on deck. And certainly, demographics and growth in the valley and traffic studies are going to play a role in that. I can tell you that we've started to work on plans and lay out the project that we have out in Inspirada in Green Valley. We think that's a very, very dynamic market, a ton of population growth, and the traffic out there is fantastic. We're also actively working on the Skye Canyon project, which is up near the Charleston turnoff out there. Skye Canyon is one of the fastest-growing master plan developments in the United States. We've got a great location right off the freeway there. We're actually working on predevelopment up on our site in Reno, which is across the street from the convention center. So we're tracking what's happening in the Northern Nevada market with the same dynamics with a lot of people moving there looking for a tax haven and just overall diversification of the economy and technology and all the good stuff happening in that area. While we haven't committed to exactly what's going to be next, we spend a lot of time debating which one we pull the trigger on next. But I can tell you that the focus right now is getting Durango to open. And yes, being in a position that right on the heels of opening that project, we would be in a position to break ground and announce the next pipeline of deals.

And then just for my follow-up, Steve, on the corporate expense for the quarter, I think it was around $15 million. It ticked higher a little bit sequentially. Was there anything, bonus accruals or any kind of one-time items in there? Is that a good run rate to use going forward?

I believe that a run rate of $5 million to $5.1 million a month is reasonable. However, in the fourth quarter, it was evident that 2021 was a strong year for the company, and we decided to reward our team members. Consequently, we increased our bonus accrual for the year to ensure our team received these rewards.

The next question comes from Chad Beynon with Macquarie. Please go ahead.

Congrats on the results. First, I want to start with just the margins. At these levels, how should we think about flow through going forward, whether it's the older customer coming back on the gaming side or that nongaming business starting to turn on a little bit more on events and convention? Can you still generate 50% plus flow-throughs with revenues coming in, given where margins are at this rate?

Incremental gaming revenue will obviously come in at a very high margin as the older demographic begins to return. Historically, our convention and banquet business has operated at a margin of at least 50%. We certainly expect to continue this trend, but I'm not sure, Steve, about our performance over the past quarters.

Yes, since reopening.

Yes, sure. I think we discussed this last quarter, but over the past seven quarters, we have consistently exceeded 45%. We have been focusing heavily on operations, making adjustments in both operations and marketing programs. We believe our efforts have been transformative. Achieving these margins and flow-through should become the standard rather than the exception, as evidenced by our performance over the last seven quarters. Additionally, as Lorenzo mentioned, the theater business will rebound once the product improves. December was a strong month for theaters due to the Spider-Man release, and we anticipate more successes like that. Typically, we expect around 600,000 visitors per quarter for theaters, which is a business that operates at a 100% margin for us. Furthermore, any additional volume they generate leads to extra deposits for the product.

And then in '22, even with the elevated CapEx for Durango holding the business flat, you'll still be able to generate some excess free cash flow. So from a capital allocation standpoint, how should we think about what the best use of this cash is during the next year?

Well, I mean, from our perspective, we think the best use of cash is exactly what we're doing with investing in Durango. I mean, we don't really look at that like traditional CapEx. I think there are a lot of companies out there that would love to be investing their money in a location like Durango. I mean, that's true investment capital. I think when you look at our maintenance number, it should be kind of in line with where we've been before.

75 to 100.

It just depends on how you look at it. It's free cash flow. We've got a lot of free cash flow. We just happen to be investing it in a project that we think we're going to get a very high return on.

It's got twice the adults per gaming position within a 5-mile zone as Red Rock and Green Valley. So we think it's a good use of capital.

Yes. Sorry. I guess my question is, during this phase, should we think about considerations for dividends or share repurchases, or during 2022 should we not assume that that’s on the table?

I think you should assume everything is on the table. I mean, as I mentioned in the remarks, we're going to take a balanced approach to longer-term growth opportunities as well as return capital to shareholders. You saw what we did in 2021, which we think was extraordinary and probably the only gaming company to not raise debt, to not raise equity and then return over $700 million to our shareholders, which kind of proves that out. The balance sheet at 3.5 times net leverage at an average interest rate of 3.5% with no long-term maturities is positioned well for the Board to consider both growth opportunities and, in a balanced approach, returning capital if they so choose.

And we still have room left on our share repurchase program.

This concludes our question-and-answer session. I would like to turn the conference back over to Stephen Cootey for any closing remarks.

Thank you, everyone, for joining the call, and we look forward to touching base in the next 90 days. Thank you very much.

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