Thank you for standing by. My name is Rebecca, and I will be your conference operator today. At this time, I would like to welcome everyone to the Smith Douglas Homes Third Quarter 2024 Earnings Call. I would now like to turn the call over to Joe Thomas, Senior Vice President of Accounting and Finance.

Good morning, and welcome to the earnings conference call for Smith Douglas Homes. We issued a press release this morning outlining our results for the third quarter of 2024, which we will discuss on today's call and which can be found on our website. Please note, this call will be simultaneously webcast on the Investor Relations section of our website. Before the call begins, I would like to remind everyone that certain statements made on this call, which are not historical facts, including statements concerning future financial and operating goals and performance are forward-looking statements. Actual results could differ materially from such statements due to known and unknown risks, uncertainties and other important factors as detailed in the company's SEC filings. Except as required by law, the company undertakes no duty to update these forward-looking statements. Additionally, reconciliations of non-GAAP financial measures discussed on this call to the most comparable GAAP measures can be found in our press release located on our website and our SEC filings. Hosting the call this morning are Greg Bennett, the company's CEO and Vice Chairman and Russ Devendorf, our Executive Vice President and CFO. I'd now like to turn the call over to Greg.

Thanks, Joe, and good morning to everyone. Smith Douglas turned in another quarter of solid profitability in the third quarter of 2024, generating pretax income of $39.6 million or $0.58 per diluted share. The primary driver of these results was continuing to deliver on our growth plan with new home deliveries of 812, a record quarter for our company. These closings led to home closing revenue rising 41% year-over-year to $277.8 million. We also performed well on the margin front in the quarter with home sales gross margin coming in at the high end of our guidance range at 26.5%. Despite the impact of the continued high interest rates, we have been able to strategically take price where possible while remaining focused on reducing our bricks and mortar cost of homes sold. We're also able to gain operating leverage on our selling, general and administrative costs with our SG&A expenses falling to 12.3% of revenue for the quarter. Order activity during the quarter followed normal seasonal patterns with some variation caused by movements in mortgage rates. We continue to see healthy demand trends in our markets driven by a lack of existing home inventory, strong local economies and steady growth in household formation. We did experience some hesitancy on behalf of buyers beginning in September and into October as many people in the market expected rates to come down further or had concerns about the outcome of the election. We believe these issues will prove to be temporary headwinds to our sales efforts and I am optimistic that much of the macro uncertainty will be cleared up in time for the spring selling season next year. During the quarter, we made progress solidifying our presence in our more established markets while also gaining a better foothold in our newer markets. Our two biggest markets, Atlanta and Alabama, continue to perform well for us from a unit delivery perspective, but we do continue to face some issues of affordability in Alabama. The Carolinas held steady during the quarter, while demand in Houston was a little softer. We make further headway ramping up our operations in Central Georgia and Chattanooga with additional hires and contact of future lots. Additionally, we are happy to announce that we've entered the Greenville, South Carolina market, where we have recently hired a new division president and already have five land deals under contract and expect lot deliveries in early 2026. We've been very deliberate and thoughtful in our expansion efforts, targeting markets with great long-term growth prospects that fit our company's operational strategy. We believe our existing geographic presence will serve as an excellent platform to grow and increase the company's size and scale. Driving this growth will be the same operational philosophies that have proven successful since their inception: acquiring land via option agreements and land banking arrangements, offering quality new homes at affordable prices, allowing our customers the ability to personalize their homes and working with our partners to streamline the construction process and deliver homes in a timely manner. We remain focused on adhering to this operational model and believe it is the key to our long-term success in this industry. As we head into the end of 2024, we believe we're in a great position to achieve our delivery goals for the year and carry that momentum into 2025. Cycle times are back to their pre-COVID levels in most markets and in some instances, even better. We have several new communities scheduled to open ahead of the spring selling season that we believe will help us drive sales. We also have the advantage of offering some of the most affordably priced homes of any of the publicly traded homebuilders. Our balance sheet remains in great shape, and we have a real opportunity to gain market share. Given these positives, I remain very optimistic about the future of the industry and our company. With that, I'd like to turn the call over to Russ, who will provide more detail on our performance this quarter and give an update on our outlook for the year.

Thanks, Greg. I'm going to highlight some of our results for the second quarter and conclude my remarks with our expectations and outlook for the fourth quarter and full year for 2024 and touch on some high-level thoughts for 2025. As Greg mentioned, we finished the third quarter with $278 million of revenue, a greater than 40% increase from the year-ago period on 812 closings for an average sales price on closed homes of $342,000. Our gross margin was 26.5% and SG&A expense was 12.3% of revenue. All these results were at the high end or better of our previous guidance for the quarter. Pretax income was $39.6 million with net income of $37.8 million for the quarter. Given the nature of our organizational structure, our reported net income reflects an effective tax rate of 4.4% on the face of our income statement. This income tax expense is primarily attributable to the income related to the 17.3% economic ownership of our public shareholders that is held by Smith Douglas Homes Corp and Smith Douglas Holdings LLC. Our adjusted net income, which is a non-GAAP measure that we believe is useful given our organizational structure, is $29.9 million for the quarter and assumes a 24.5% blended federal and state effective tax rate as if we had 100% public ownership operating as a subchapter C corporation. We believe adjusted net income is a useful metric because it allows management and investors to evaluate our operating performance and comparability more effectively to industry peers that may have a more traditional structure from an organizational and tax standpoint. You can find more information about our structure and income taxes in the footnotes of our financial statements. We finished the third quarter with just under 18,000 total controlled lots, an increase of 54% over the third quarter of 2023 and 13% higher than the second quarter of this year. As we enter and expand into new markets, as Greg previously highlighted, we would expect our year supply of option lots under contract to be elevated from the typical run rate of 3.5 to 5.5 years of lots controlled based on forward closings. We finished the third quarter with 961 homes in backlog with an average selling price of $346,000 and an expected gross margin on those homes of approximately 25.5%. At the end of the quarter, we were operating out of 74 active selling communities versus 62 at the end of the third quarter last year. Looking at our balance sheet, we ended the quarter with approximately $24 million of cash and no borrowings under our $250 million revolving credit facility and $372 million of stockholders' equity. Our debt to book capitalization was 0.9% and our net debt to net book capitalization was negative 5.8%. We had approximately $229 million available on our unsecured credit facility and are well positioned to execute on our growth strategy, as Greg previously mentioned. Now I'd like to summarize our outlook for the fourth quarter and full year for 2024. We anticipate our fourth quarter home closings to finish between 750 and 800 homes at an average sales price between $340,000 and $345,000 with gross margin in the range of 25.2% and 25.7%. Based on the aforementioned fourth quarter guidance, we are now projecting total home closings for the full year 2024 to come in between 2,780 and 2,830 homes, an increase of 80 closings or approximately 3% higher than the midpoint of our prior guidance. We expect our average selling price to range between $339,000 to $341,000, and our home closings gross margin to finish between 26% and 26.5%, which is a slight decrease to the higher end of our prior guidance, primarily due to the additional closings we are now forecasting at a lower margin. For SG&A expenses, we now expect our ratio to be in the range of 13.5% and 14% for the full year, an approximate 25 basis points improvement from previous guidance. While we are still wrapping up our 2025 budget process with division management, which we will review with our Board in December, I would be remiss if I did not provide some color on our expectations for next year given that we won't hold our next earnings call until March. Before getting to our numbers, I first must caveat that there are many factors beyond our control that can and will impact our forecast. But we remain committed to providing the analysts and investor community as much transparency into our business as reasonably possible, which we committed to during our IPO process earlier this year. As Greg previously touched on, we remain long-term optimistic about new home demand given the current and projected lack of housing supply in our markets. Housing affordability continues to remain the biggest challenge across the country. Sitting here today, it is too difficult and too early to gauge the pace and direction at which mortgage rates will move over the next 6 to 12 months. Additionally, while the election is behind us, it is also too early to determine what impact this administration's policies specifically on immigration and tariffs will have on our industry and the potential impact on cost and production. With that said, our preliminary expectations are for 2025 closings to be in the range of 3,000 to 3,250 homes, assuming we finish 2024 near the midpoint of our guidance. As we have previously guided, gross margin will continue to compress due to higher land costs, and we would now expect a gross margin target of 25% with a 25 basis point margin of error on either side. Lastly, we would anticipate our average selling price on homes closed to remain relatively flat from 2024 and be within a range of $335,000 to $345,000 for 2025. We believe the primary risk to all of our projections is around our ability to maintain sales pace and bring our new communities and lots online. As I have mentioned on every call, we continue to see some delays with municipalities on permitting and flat approvals. Macroeconomic factors, primarily around jobs, inflation, and interest rates could also have unforeseen impacts to our numbers. With that, I'd like to turn the call over to the operator for instructions on Q&A.

Your first question comes from the line of Mike Dahl with RBC Capital Markets.

Thanks, Greg, Russ, for all the comments in the opening remarks and the thoughts on 2025. Russ, I want to pick up on that and understanding it's very early, lots of moving pieces. When you think about those numbers that you just threw out, given the moving pieces, how should we interpret that? Is that kind of assuming a market status quo from where we sit today, these are the numbers you deliver? Or is that still embedding some view on some potential improvement in market conditions as kind of the spring kicks off?

Yes, thanks, Mike. But it's pretty consistent with what we're seeing today just from a market perspective. We're not assuming any major shift in what may or may not happen. Just based on now the fact that we're past elections, interest rates—this is what I would tell you; we've been going through a budget process with the divisions for the last 45 days, 60 days. It’s kind of what we're seeing from the roll-up right now. And it's difficult to project again because we've had such a great year. I think it's been a little bit choppy towards the last couple of months. But yes, that's our best guess sitting here today. But certainly, if things—if rates come down and things improve, sure, probably some—I’d look more to the higher end of the range. But if we see a little bit more of a shakeup with jobs, certainly kind of towards the lower end. So again, just kind of best guess status quo.

Okay. Got it. Yes, I appreciate the balance there. And then sticking with a similar topic, when you’re thinking about that delivery guide, your community count is kind of stagnated a little bit. Obviously, there’s a lot of lots you’ve put under control, a lot of plans for community openings, both in existing and new markets. So, help us understand kind of the ramp as you envision it into and through 2025. And then if I could sneak in a different one, just back on the lot cost comment. Can you help us kind of quantify what specifically—I know we’ve talked about this in the past, but give us an update on what you’re looking at on lot cost for next year versus 2024?

Sure. I think it'd be fair to expect a 15% increase in community count next year. And again, we've got a lot of communities—I think—coming online when we look at our lots—our community schedules. It looks like there's more communities coming online in the back half of the year. And some of this is if you think about us going public, putting more lots, and we've had a significant ramp-up in putting lots under control. It's now getting some of those lots and communities coming online because it takes us—once we contract for a deal and then get land development permits—yes, it's like 14 to 18 months to get a community online. So I'd say that, that's part of that growth. You might not—even though we might end with 15% by the end of the year, keep in mind, it's not that those are going to be all coming online and delivering a full year of absorption.

Just remind us or refresh us on kind of quantifying what the—as you look at it today, what your average lot costs are going to look like in 2025 and how that compares to 2024?

Yes. So I'll start by telling you our lot cost in the quarter was about $85,000, and that's about a 24.8% of revenue. And it compares last year; we were right at around $73,000 in lot costs, which was 21.5% of revenue. And then I would—so there's 300 basis points. And like we talked about, that's the big driver of the compression that we've seen in margin and will continue to be the big driver because when you look at our construction costs, it's been relatively flat and really for the last two to three years. Construction costs have been relatively flat, and we were just looking at this the other day, and our square footage of homes is also flat. So, we've really been able to control our vertical costs, which is great, and the subcontractor costs, and it's really all the lot cost. And so, as we look towards next year, we think that the lot cost is going to go up another $10,000 to $12,000 per lot. So, it's somewhere in the mid-90s or so. And that's, again, assuming that we have a flat average selling price, there's going to be your erosion in margin. And again, assuming that we can keep those vertical costs pretty flat.

Your next question comes from the line of Michael Rehaut with JPMorgan.

This is Andrew on for Mike. Congrats on the quarter. Thanks for the thoughts on next year. I'd love to get—I'm not sure if you alluded to your assumptions on the potential incentive load going forward. Would love to hear your thoughts on that. I know it's relatively small for you guys.

Yes. So incentives, and this is between price adjustments and closing cost incentives, we're running just over 3% for us. The price adjustments are a little less than half of that, and the closing costs are a little bit more of that, just over 3%. It's actually when we were looking at that year-over-year, it's actually slightly down year-over-year, about 30 basis points, mostly on the price adjustment side, which is kind of the discounting we give on the sticker price. It's really closing costs where we've seen those incentives creep. We're kind of assuming our budget for next year, flattish incentives. And again, interest rates are going to be the big wildcard. Obviously, the Fed continues to lower rates, but I think a lot of that’s been baked into mortgages already for some time. And so, it's really difficult. Like I said in the prepared remarks, who knows, the next 6 to 12 months, it's really difficult to figure out the direction of where those rates are going. And then, clearly, we feel like with the change in administration and some of the policies, hopefully, it's a more net positive, but certainly remains to be seen. Way too early to tell.

Got it. And then maybe turning to the M&A environment and maybe a less strict regulation environment. Can you talk about what you're seeing there? And has anything changed in how the pipeline is looking like?

Sure. Look, we think certainly less regulation is definitely a positive that will come out of this, whether it's M&A and hopefully just in us dealing with the municipalities and the federal agencies that we typically have to go through as we go through the process of getting zoning and all that stuff. So, that should be helpful. And then just specifically on the M&A front, yes, look, I think that's going to really go the way of the general market, how the economy fares going forward. We're still seeing a pretty healthy pipeline. There's definitely deals out there. We've seen packages come across our desk. Again, from our standpoint, it might be a little too rich right now. But we're always looking. We're going to be opportunistic, as we've said previously. We did enter, as Greg mentioned, Greenville, South Carolina. We're doing that through a greenfield startup. So, we're seeing plenty of opportunities as we look at some new markets, not just on the M&A front. But for us in our business model and up until we did the Houston deal last year, everything we've done is through a greenfield startup. So, we're very confident in getting ramped up in markets. It takes a little bit longer, clearly, but that's probably the strategy that we will proceed with, is more looking at greenfield. But yes, we're seeing some deals. We'll keep our eyes open.

Your next question comes from the line of Sam Reid with Wells Fargo.

I wanted to touch on the order cadence. In the prepared remarks, it sounds like it was a bit more seasonal, but wanted to put a finer point on that, especially September into October, where it sounds like buyers might have pulled back a bit ahead of the election. And then I know it's still early, but we are, let's call it, a week off the election here. Any early thoughts on buyer traffic and conversion in November coming off the election that we should be mindful of as we're modeling orders in Q4?

Yes, Sam. Thanks for the question. We did see softer traffic September into October. Traffic probably followed more like seasonality. The conversions were slower. Buyers were more hesitant to make decisions. I can only assume that a lot of that's tied to the election and thoughts around, will there be incentives and opportunities should we wait, kind of thoughts with buyers. That's an assumption that maybe that was the mentality. We have— as you said, it's been early, but we had good traffic last week, maybe slightly better than seasonal traffic. What's encouraging, our appointments were up. So, to me, that's an indicator, maybe future, we're going to see some of the reluctance come back. We're still getting conversions. They're just—the typical buyers taking much longer to get converted. And yes, but I think it's too early for us to say there's going to be any meaningful uptick, but we're optimistic.

No, that helps. And then I wanted to talk through your recently announced mortgage JV. I believe that's been a long time coming. I know it's going to probably streamline the mortgage process for your buyers. But maybe also, can you give us any color on how you might be able to better target your financing incentives perhaps with a more formal mortgage JV program in place?

Yes. I think for us, the biggest thing will be consistency across our platform. We've had—I think it's roughly 18 preferred lenders across the footprint. And we're real thankful for those preferred lenders. It's actually in my 25 years in the business, the preferred lenders and the kind of capture that we have been getting have been really good. They were good partners. But there are—look, it's much more difficult to manage that—those kind of relationships. It takes a lot of time for the divisions to do it. It's difficult for us at corporate to really help in the management and really looking at stats and trying to keep things consistent. So, I think the biggest thing for us is the consistency that that's going to bring across the footprint. And then certainly, loanDepot goes without saying, but they partner with some other big builders. That was a big reason for us choosing loanDepot. This isn't their first rodeo. They operate all across the country. So, they are definitely well set up to support us and the growing business. So, we're really excited about that partnership. But yes, it's going to be a lot of consistency that we bring to the table. And look, first and foremost, for us, the preferred lender relationships and even this joint venture with loanDepot, it's going to be great. Sure, it's going to add some dollars to the bottom line, no doubt, but it's really about controlling the process as most builders would tell you, having that financial partnership and getting that capture is really about controlling the process and helping our buyers mostly getting to the closing table and working through a smooth closing process. So, we're pretty excited.

Your next question comes from the line of Jay McCanless with Wedbush Securities.

So Russ, not to get too much into the details, but with what you're talking about with doing some greenfield expansions, any thought as to what SG&A dollars or percentages look like for 2025? Because it sounds like between Chattanooga, Greenville and the I-75 corridor, you all are going to be doing a lot of greenfield, buying a lot of new dirt. So, any thoughts on SG&A would be helpful.

Yes. We're going to finish, I think I quoted 13.5% to 14% this year on SG&A as a percent of revenue. Yes, we're going to put some more variable—well, I mean, we're going to put the fixed overhead in. We've got a division president in Greenville. We've hired somebody on the land development side. We're looking at somebody on the land acquisition side as well and some folks, and then obviously, some office space. And so yes, there is some—there's definitely going to be some G&A ramp without the revenues for sure next year. But we are growing—we're hoping to grow the business at least somewhere in the 10% to 20% range from a unit volume perspective. And if average selling prices stay relatively flat, obviously, that's going to grow the revenue. And I think we're pretty good right now on the support center side. I don't think there's a lot of headcount to add on the corporate G&A. So, I would be surprised if we didn't see the opportunity to leverage more overhead, maybe it's 50 basis points. I mean we'd love to—I'd love to tell you we're going to get down 100 basis points to 12.5%, but it's hard to sit here and say that when we also are looking at some of these greenfield opportunities that are going to definitely add some G&A. So, look, if we can get closer to 13% next year, I'd say that's probably a good target if you're going to try and model something.

One thing I'll add there, Jay, is Chattanooga, we're already realizing closings there and getting some offset. The majority of the lot pickup there in Chattanooga was finished lots. So, we're already into production and vertical in most all those neighborhoods.

Okay. That's great. I guess the second question on pricing power. I guess, what percentage of communities were you able to raise base pricing? And could you break out what incentives were this quarter maybe versus Q2 and last year?

Yes. So I'll touch on the incentives. I know we actually just did an analysis on communities where we were—where we've raised base prices and maybe actually took some decreases. And I can tell you—and Joe is here, he's looking it up, but it actually slowed down, clearly, right? Third quarter, we did not raise price in communities as fast as we had. And actually, in some cases, we were taking base prices down. And Joe, if he's able to pull it up, can give you exact, but—or we can get back to you after the call. As it relates to incentives, I think I mentioned on one of the prior questions, our incentives, and this is between price adjustments and closing cost incentives were just over 3%. A little less than half of that 3% was coming from the price adjustments and greater than half of that was on the closing cost side, and that's mortgage buydowns and some closing credits and stuff. And then last year, that compared—we were actually down about 30 basis points from the third quarter of last year. So, it was actually the price adjustments came down a bit, but it was the closing cost incentives that were up. But overall, between the two, we were slightly down. And then I'd have to look—I don't have the second quarter in front of me, but I want to tell you, I think it's probably about flat from where we saw the second quarter. Closing costs might have been up a little bit. So it's—I mean, again, we haven't seen it move, but I'd say materially quarter-over-quarter. We definitely did see some base price decreases and certainly, the speed at which we were raising prices has slowed quite a bit. So, we're definitely seeing the effects of a little more choppy third quarter, as Greg mentioned, and kind of as we get—we headed towards the election, some buyer hesitancy.

Okay. Great. And then the last question I had, Greg, you touched on Alabama, some affordability issues. I guess what are you all doing there, whether it's smaller floor plans, taking some options out? How are you all attacking that challenge?

So, we are focused on plan size, but it's more on the incentive side and margin. I mean we're just giving up margin to keep pace and making the homes to meet the buyers' qualification needs.

Your next question comes from the line of Rafe Jadrosich with Bank of America.

I appreciate all the comments on 2025. I just wanted to follow up on the gross margin side. I think you said your backlog now is a little bit above 25%, maybe 25.5%, if I heard it right. And you're sort of planning to stay in that range next year. Can you just talk about what that assumes for inflation and net price into what like you have visibility on? Obviously, it sounds like you still have land inflation, but it feels like you feel confident you can offset that. Just help us understand the puts and takes there?

Yes. So, our backlog right now is sitting at 25.5%. There could be a little more cushion with rebates in there. And so we guided—and again, like I mentioned on the prepared remarks, I mean, there's a ton of caveats in there. We're so early to tell what's going to happen with, again, rates and policy. The best we can sit here and say is, hey, 25% gross margin with a margin of error of 25 basis points on either side. So, that 25% could actually come down a little bit. But what we've seen in our last—we look at gross margin in our sales, we look at it on trailing 13-week and where things are going. And it's still—we're still selling at north of 25% as we sit here today. So, we hope—we'd love to say that we're going to go into the end of the year, and a lot of this depends on how much we sell the balance of the year and what closings come in at, but we'd love to see our backlog be close to about 1/3 of what we're going to close in 2025. And so, if we're sitting at 25.5%+ with 30% of the closings already baked, then you can imagine we are assuming that margins are going to continue to compress as we sell throughout the year. But that's just kind of land costs and just really considering a more flat market. But again, if the market doesn't cooperate, sure. I mean that margin could actually be a little bit lower. And if you know how we operate, which we've talked about before, we are a pace-over-price builder, right? We make more or we lose less at full capacity. And so, we're really focused on keeping our manufacturing or operating machine going. And so, margin is the—is really that that's going to be what we have to dial up or down to hit our velocity. So, it really just—it's going to depend. But sitting here today, we just kind of expect, like I said earlier, status quo from a market perspective.

That's helpful. And then just can you talk about what the—what you're seeing in terms of the margins for Devon Street and Houston relative to the overall and like how that acquisition's progress on the margin side?

Sure. I want to say for the year, they were probably around 24%, 25% gross. And it's actually—it's as good as we could have expected. The overall acquisition, one of the—I think our team has done a phenomenal job. It's a huge credit to the Houston folks. We really didn't lose many folks in the transition, and now it's been almost—it's over a year. But that team has done a phenomenal job of—and our team as well of just trying to integrate them into the Smith Douglas system and process, and we've changed over product where we could in neighborhoods. We've obviously rebranded the entire thing, and they are on 100% of our systems. So, it's actually gone real well. Now as Greg mentioned, Houston has been a little bit slower in the back half of the year. First half of the year, sales were great. I'd say it's definitely been a bit slower. But they will—I think as part of our projection, I mean, we'll get 375 to 400 closings out of Houston this year, maybe closer to the high end of the range as we sit here today. So, it's been a phenomenal acquisition for us. We're real happy with it.

Your next question comes from the line of Alex Barron with Housing Research Center.

Yes, I was just thinking about the rough guidance you gave of 3,000 to 3,250 for next year. I guess that would imply maybe 800 to 900 orders a quarter. And given where things are at right now and the comment on hesitancy, is that the only thing you think needs to go away to get those numbers back up there? Or is there an implied ramp-up in community count? Or is it your other comment about maybe dialing the margin a little bit lower just to increase the pace? What do you guys—how do you guys see the progression to get there?

Yes, Alex, thanks for the question. It's—we're assuming kind of a status quo. It assumes that we—the market doesn't really move strongly one way or another. We do have the land and lots under control, certainly to get to those numbers, right? So, 100% of our land and lots for next year are under control to hit those numbers. And I would tell you, look, if the market picks up and rates come down and jobs are great and policy is great, I think we can potentially do better. But it's real difficult sitting here today. There's definitely—the risks to next year, as I see it from a unit volume perspective are certainly the market itself and what's that going to be for the demand picture. And I'd say specifically, it's more about jobs, right? We've always—we've definitely been able to solve the affordability issue with rate buy-downs and closing cost incentives, and that hasn't been the biggest issue. But if the demand—actual homebuyer demand slows and which I'd say the biggest thing is going to be around job growth or unemployment, that could be the biggest factor that would push you to a lower end of that guidance. And then the other—the second thing I'd say is really just getting some of those communities that we're forecasting mostly for the back half of the year to come online and getting those finished lots in the ground. And internally, we have a big focus next year on looking at—we're maniacal about cycle times when it comes to vertical construction. And so, we're really taking a deep dive and a focus on that cycle time around the lot process and getting lots on the ground.

I will now turn the call back over to Greg Bennett for closing remarks.

Thank you, everyone, for your interest today. Thank you for the questions. I appreciate the opportunity to share with each of you on the earnings call today. Hope everyone has a great day.

Ladies and gentlemen, that concludes today's call. Thank you all for joining. You may now disconnect.