Earnings Call Transcript - UHS Q1 2023

Operator, Operator

Good morning and thank you for standing by. Welcome to the First Quarter 2023 Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speakers' presentation, there will be a question-and-answer session. Please be advised that today's conference is being recorded. I would now like to hand the conference over to Steve Filton, Executive Vice President and Chief Financial Officer. Please go ahead.

Steve Filton, CFO

Thank you, and good morning. Marc Miller is joining us this morning. We welcome you to this review of Universal Health Services results for the first quarter ended March 31, 2023. During the conference call, we will be using words such as believes, expects, anticipates, estimates, and similar words that represent forecasts, projections and forward-looking statements. For anyone not familiar with the risks and uncertainties inherent in these forward-looking statements, I recommend a careful reading of the section on risk factors and forward-looking statements in our Form 10-K for the year ended December 31, 2022. We would like to highlight just a couple of developments and business trends before opening the call up to questions. As discussed in our press release last night, the company reported net income attributable to UHS per diluted share of $2.28 for the first quarter of 2023. After adjusting for the impact of the items reflected in the supplemental schedule included with the press release, our adjusted net income attributable to UHS per diluted share was $2.34 for the quarter ended March 31, 2023. During the first quarter, our behavioral health hospitals produced strong results. The decline in COVID activity allowed our behavioral hospitals to continue to reduce their labor vacancies, resulting in a reduction of the capped bed capacity and a 4.7% year-over-year increase in adjusted patient days. Combined with a healthy 5% increase in net revenue per adjusted patient day, overall revenues grew by almost 10% over the prior year quarter. And with that level of revenue growth, same-store behavioral EBITDA margins increased from 20% to almost 23%. Our acute hospitals experienced strong demand for their services with adjusted admissions increasing 10.5% year-over-year. For various reasons, revenue growth was more muted at 3.5%. As a percentage of total admissions, COVID diagnosed patients made up 14% of our admissions in the first quarter of 2022, but only 4% of admissions in the first quarter of 2023. This decline in COVID patients resulted in reduced revenues due to the lower acuity and less of the incremental government reimbursement associated with COVID patients. The impact of the COVID support payments, including HRSA, Medicare sequestration, and the 20% Medicare add-on was a $42 million headwind in the first quarter compared to the same prior year period. There was also $15 million of out-of-period Texas TERP reimbursement recorded in Q1 of 2022 that did not recur in this year's quarter. While overall surgical volumes were robust, increasing a little over 10% from the prior year quarter, there was a continuing shift from inpatient to outpatient resulting in further overall revenue pressures. Meanwhile, the amount of premium pay in the quarter, which declined from a peak of $153 million in the first quarter of 2022, was $85 million in the first quarter, similar to what it was in the third and fourth quarters of 2022. The dramatic increase in volume is the major reason that premium pay has not declined further. It's worth noting that our average hourly rate, which includes premium pay, was 7% lower than it was in the first quarter of 2022. In total, the robust volume growth offset by lower revenue per adjusted admission resulted in flat same-store acute care EBITDA compared to last year's quarter. We also note that the first quarter acute non-same-store results included approximately $10 million of a headwind for the impact of the Desert Springs Hospital closure and approximately $5 million of losses related to startup facilities. Our cash generated from operating activities was $291 million during the first quarter of 2023 as compared to $445 million during the same quarter in 2022. The decline was largely due to an unfavorable change of $183 million in other working capital accounts, primarily due to the timing of disbursements for accrued compensation and accounts payable. In the first quarter of 2023, we spent $169 million on capital expenditures and acquired 650,000 of our own shares at a total cost of approximately $79 million. Since the inception of the current share repurchase program in 2014, we have repurchased more than 20% of the company's outstanding shares. As of March 31, 2023, we had $875 million of aggregate available borrowing capacity pursuant to our $1.2 billion revolving credit facility. I will now turn the call over to Marc Miller, President and CEO, for closing comments.

Marc Miller, CEO

Thanks, Steve, and good morning. In our year-end conference call, we said we envisioned 2023 as the year of continued transition into a post-pandemic world. We anticipated that volumes in both segments and acuity in our acute business would continue their recovery trajectory and gradually begin to resemble the patterns we experienced before the pandemic. The comparison to last year's first quarter for our acute hospitals, which were experiencing the significant surge in COVID patients with the Omicron variant, is particularly challenging, but many of those COVID related headwinds will become much less of a factor as the year progresses. We expect to be able to reduce premium pay by about one-third in 2023 from 2022 levels, as we continue to increase hiring rates and reduce turnover. And while the decline in premium pay has leveled off for the time being, we continue to make progress on overall wage pressures. In our Acute segment, we highlighted the upward pressure of physician expense, which tended to run at a rate of about 6% of revenues pre-pandemic, but is budgeted to run and actually is closer to 7.5% in 2023. Overall, we were pleased with our first quarter results, which were largely in line with our internal expectations, with our behavioral results somewhat ahead and our acute results slightly behind. We are pleased to answer questions at this time.

Operator, Operator

Thank you. We have a question from Jason Cassorla with Citi. Please proceed.

Jason Cassorla, Analyst

Great. I guess, first, wanted to ask about your acute volume trajectory. I guess, obviously, a solid start to the year, but curious if you believe this was broad-based underlying demand, or anything else beyond an easier comp? And I guess given performance in the quarter, how you're thinking about the sustainability of the momentum and volume growth for the remainder of 2023.

Steve Filton, CFO

Sure, Jason. Look, I think we've made the point for some time that we felt that as COVID volumes continue to decline and sort of continue at a lower, we'll call it endemic level, that the non-COVID volumes would begin to recover. I think that recovery, quite frankly, has been a bit slower than we anticipated. But clearly, taking into account what our public hospital, acute care hospital peers have said as well in the first quarter, I think there seems to be a broad-based recovery across the space. And our expectations are that we are going to begin to see acute care volumes track at their pre-pandemic patterns with volume growth in the low to mid-single digits and sort of pricing growth at a similar level. So, ultimately, particularly I think once we get beyond the first quarter with that difficult COVID comparison, we'll begin to see an acute care business model that resembles something much closer to our pre-pandemic experience.

Jason Cassorla, Analyst

Okay. Got it. Thanks. And just as a follow-up, I wanted to ask about the favorable behavioral revenue per patient day trend of 5% in the quarter. I guess any color on how we should think about the growth in that stat for the remainder of 2023, just given the improvements you're seeing on labor scarcity, better volume throughput than anything else. Any help there would be great. Thanks.

Steve Filton, CFO

Yeah. Again, we've talked about this I think on a number of prior calls. I think prior to the pandemic, revenue per adjusted day in the behavioral division tended to increase by about 2% to 3% annually during the pandemic. I think we've seen that number jump to 5% or 6% in a number of quarters. We've attributed in many cases to a more aggressive stance on our part as we renegotiated contracts with some of our lowest payers, with the idea that in an environment of capacity constraint, where we were turning patients away because of a lack of adequate staffing, it gave us more leverage to take a more aggressive stance with our payers. And again, I think you saw that in the 5% revenue per day increase in the first quarter. Obviously, I think the crux of your question is as we continue to hire more people and those capacity constraints ease, does it change the dynamic with the payers? And I think the honest answer is to a degree, but I'll also say broadly across the behavioral space, we have a view that demand exceeds the supply of beds in many geographies. In many instances, I think we're going to still have leverage with the payers in many of our geographies. If they want a place to have their patients treated, they're going to have to pay, at a minimum, market rates to providers and to us. We also mentioned in our guidance for 2023 that we projected that revenue per day growth would moderate some. So, if we see some moderation, it is certainly something that's been anticipated in our guidance. But right now, it's a pretty strong environment in terms of our negotiations with payers.

Jason Cassorla, Analyst

Great. Thank you.

Operator, Operator

Thank you. One moment for our next question, please. And it comes from the line of Josh Raskin with Nephron Research. Please proceed.

Unidentified Analyst, Analyst

Hi. Good morning. This is actually Marco on for Josh. I appreciate you taking the question. Based on your commentary, it appears that capacity is opening back up in the behavioral segment, as staffing levels improve. You also spoke to demand outstripping supply in a number of geographies. So with that, do you think we're at a point now where we should expect more development on the behavioral side or even acquisitions of assets there? Thanks.

Steve Filton, CFO

Yeah. I think it's a reasonable question. Obviously during the pandemic and during the significant capacity constraints we had, we did put on hold some of our development activities, building new capacity at existing facilities or building de novo facilities, although we certainly continued with some. But I think your question is right. I mean, we just had a recent meeting in which we reviewed a whole chunk of facilities that are running at more than 80% occupancy on the behavioral side to consider whether it merited studying building more capacity in those facilities. So, I think you're right, this is a bit of a compounding kind of dynamic. As we're able to hire more people and fill more of our permanent vacancies, we think we'll be able to treat more patients. And as we're able to treat more patients, we may need to increase capacity in some of our facilities and some of our de novo projects. So, I think that's certainly a possibility over the next several years.

Unidentified Analyst, Analyst

Great. Thanks. And then just on the acute care side, I know you gave some detail on the contract labor trends in the quarter, but I was wondering your thoughts on whether rates are now back to levels where it makes sense to just continue utilizing temporary labor as means of increasing capacity. Do you think there'll be enough sustained demand on the acute side to support that? Thanks.

Steve Filton, CFO

Yeah. I mean, so, the traditional approach to temporary labor in the acute business for us, and I think largely for our peers, always was that when there were temporary surges in volumes, it always made sense to solve those demands on your staffing with the use of temporary and traveling nurses, etc. What became really a disrupting factor during the COVID surges was that the price of that temporary labor rose to levels that sometimes were two to four times what traditional rates have been. I think as we see those numbers come down, we certainly have seen them come down quite a bit, although I don't think we're at pre-pandemic levels. I think we're going to get back to that sort of traditional approach that when we need temporary labor, we'll go to these outside agencies for it, but it'll be on a less frequent basis. There were times during the pandemic where the cost of temporary labor got so expensive that we just refused to use it if it got above a certain level. I think we're largely past that point. As we progress in 2023 and go beyond that, we'll see that temporary labor supply/demand dynamic return to a more pre-pandemic level than what we have seen in the last few years.

Unidentified Analyst, Analyst

Great. Thanks very much.

Operator, Operator

Thank you. One moment for our next question, please. All right. And it comes from the line of Andrew Mok with UBS. Please proceed.

Andrew Mok, Analyst

Thanks. Can you help us understand the sequential improvement in the acute business in the context of lower acuity trends seen in the fourth quarter? Did underlying acuity actually improve, or were volumes so strong such that it masked some of the continued acuity headwinds that you're seeing? Thanks.

Steve Filton, CFO

Yeah. So, I think the sequential improvement reflects some of the normal seasonal patterns. In any normal year, our first quarter is our busiest year on the acute side. There's generally a pretty significant step up from the fourth quarter and some of the reduced activity during the holidays. I think you saw that dynamic. I also think you continue to see a return of normal patterns, patients who had delayed or deferred procedures during the pandemic, beginning to schedule those and at least get into the pipeline for some of those more elective scheduled procedures. So, I think the acute care performance was more favorable when you look at it from a sequential basis. When you look at it from a year-over-year basis to the first quarter of last year, when we had the Omicron surge with very high acuity, the comparisons were much more challenging. You had the COVID reimbursement in the first quarter of last year. But to your point, the fourth quarter improvement was encouraging. I think it reinforces our view that we've created an appropriate guidance trajectory for 2023 with acute care performance improving.

Andrew Mok, Analyst

Got it. And related to that, hoping you can provide an update on the Las Vegas market with respect to the Desert Springs Hospital you closed down and the new Reno hospital. How's that tracking against expectations? Thanks.

Steve Filton, CFO

Yeah. So those are two very different dynamics. The Desert Springs dynamic is related to the new hospital we're building in West Henderson. As I think physicians, patients, and employees all realized that ultimately West Henderson will replace Desert's function in the market, they began to make other decisions and move to other hospitals, often to our own hospitals elsewhere in the market. We made the decision to close Desert as an acute care hospital, but we still operate a freestanding emergency department on the site. Those shutdown and severance costs created a $10 million headwind in the first quarter compared to last year. After that, as the year progresses, Desert Springs will have much less of an impact. We're looking forward to the positive impact that West Henderson will have when it opens in either the spring or middle of 2024. In Reno, our new hospital had a bit of a drag compared to last year, but certainly not at the level of 2022 when it was a $7 million or $8 million drag per quarter on average. We expect about a $30 million favorable tailwind in 2023 from the Reno hospital. Broadly, I would say that we've seen our Texas and Florida markets recover from the pandemic dynamics faster than other markets around the country, including Nevada and California.

Andrew Mok, Analyst

Great. Thanks for the color.

Operator, Operator

Thank you. One moment for our next question, please. All right. And it comes from the line of Stephen Baxter with Wells Fargo. Please proceed.

Unidentified Analyst, Analyst

Hi. Thanks for taking the question. This is Nick on for Steve. I was hoping you could talk a little bit about how your Q1 results impact your thinking for full year guidance, particularly in light of some of the margin favorability you saw in behavioral in the quarter. Thank you.

Steve Filton, CFO

Yeah. As is our practice, we didn't address guidance in our press release, which means that we're maintaining our existing guidance. I will say that our internal forecast for the quarter was somewhat ahead of the consensus estimates, although our actual results exceeded both consensus and our internal forecast. I know that a couple of our peers raised their guidance in the first quarter. I've been at UHS for more than three decades; I don't recall that we've ever changed our guidance after the first quarter, for better or for worse. In this case, it would have been for better had there been any change. We're pleased with the first quarter results, and unlike other years, the earnings trajectory we're expecting in 2023 is that earnings will continue to improve as the year progresses. We feel very comfortable with our full year earnings predicted.

Operator, Operator

Does that answer your question, sir?

Unidentified Analyst, Analyst

Yes. Thank you.

Operator, Operator

My pleasure. One moment for our next question, please. All right. And it comes from the line of Ann Hynes with Mizuho Group. Please proceed.

Ann Hynes, Analyst

Hi. Good morning. Could you talk about nursing trends maybe in each segment? Which segment do you think is recovering faster than the other? And I know you said turnover improved, but can you give us some stats? Maybe what turnover was at the height of the pandemic, what it was before the pandemic, and what it's trailing now? Thanks.

Steve Filton, CFO

Sure, Ann. Turnover, particularly in nursing, across the U.S. pre-pandemic tended to average in the low 30% range. Most of our hospitals tended to do a little better than that, but obviously nursing turnover has been a significant challenge for the hospital industry for many years. During the pandemic, those percentages often doubled and sometimes even tripled. Again, this is not just for UHS and not just for acute or behavioral, but for hospitals across the country, especially sub-acute providers like behavioral hospitals or nursing homes. As COVID volumes diminished and reduced to the levels we saw in Q1 of this year, many nurses returned to their original or home base occupations. We've seen a faster and quicker benefit to that on the behavioral side, where we have been able to fill more of our permanent vacancies and admit more patients accordingly. The 10% same-store revenue growth we saw in the first quarter is a reflection of that progress. We're also making progress on the acute care side, where we've reduced our premium pay by almost half from where it was a year ago. Contract labor as a percentage of overall salaries is in the 5% to 6% range, which is right where our peers are.

Ann Hynes, Analyst

Great. And just on the inpatient side, inpatient trends, admissions improve sequentially, can you just describe what delta, like what do you think is coming back versus what was not in 2022?

Steve Filton, CFO

Yeah. I think it tends to be across the board. We've seen emergency room volumes increase, and that always has a cascading impact on our admissions. We've seen our schedules for elective and surgical procedures increase. The dampening impact is a shift to more procedures being done on an outpatient basis. Particularly in the orthopedic service line, we've seen a dramatic shift from inpatient to outpatient over the last couple of years. But broadly, we're seeing volumes in almost all of our service lines improve.

Ann Hynes, Analyst

Great. Thanks.

Operator, Operator

Thank you. One moment for our next question, please. And it comes from the line of Justin Lake with Wolfe Research. Please proceed.

Unidentified Analyst, Analyst

Hey, guys. This is Austin on for Justin. I appreciate the question. Steve, sticking on that scheduled elective mix you just described. I know that was a focal point in Q2, Q3, and through the back half of last year. You noted some improvement there, but wondering if you can quantify where that's tracking versus the pre-pandemic level. Is that shift to outpatient maybe shifting that run rate going forward? Thanks.

Steve Filton, CFO

So, again, I think in my prepared remarks, I talked about year-over-year surgical growth being around 10%, higher on the outpatient side, maybe 14%, lower on the inpatient side, maybe around 4%. That growth level reflects a catch-up of deferred procedures. But I think we've argued for some time that as COVID volumes declined, surgical volumes would return to their pre-pandemic levels. We're recapturing some of the volume we lost during the pandemic. Absent another COVID surge, there should be a steady and sustainable growth in surgical volumes, albeit skewed more towards outpatient rather than inpatient.

Unidentified Analyst, Analyst

Great. Thanks. And then maybe just as a quick follow-up. Commercial contracting cycle kind of in focus, I'm just wondering if there's any update there and if you're still seeing some favorability on that front. Thanks.

Steve Filton, CFO

Yeah. I think, as we've indicated since the back half of 2022, we've been negotiating managed care increases that are generally somewhere in a 150 to 175 basis point range higher than what they were pre-pandemic. That trend will continue for a number of periods, as contracts come up for renewal. We're getting some relief, though it's not full relief for the inflationary pressures we've been under. More clearly on the behavioral side, that can be seen in our revenue per day. Not as easily on the acute side, but those comparisons will become much clearer past the first quarter when COVID comparisons to prior year are more equal.

Unidentified Analyst, Analyst

Great. Thanks for the color, guys.

Operator, Operator

Thank you. One moment for our next question, please. And it comes from the line of Kevin Fishbeck with Bank of America. Please go ahead.

Joanna Gajuk, Analyst

Hi. Good morning. Thank you. This is Joanna Gajuk filling in for Kevin today. Thanks for taking the question. So, I guess, first just a follow-up on the behavioral business. The volumes are pretty strong there. Can you talk about the regional or business line specifics, or is it kind of across the board? Just any additional color on the site volume strength?

Steve Filton, CFO

Not really, Joanna. The biggest constraint on our volume growth in behavioral was our staffing and the inability to hire a sufficient number of clinicians, especially nurses, but also other professionals like therapists and psychiatrists. We continue to see our behavioral volumes improve in the back half of 2022, and they continued to improve very robustly in the first quarter. We're optimistic about our ability to fill vacancies and treat more patients. That 10% same-store revenue growth couldn't come from anything but a comprehensive improvement; there’s not a single geography or service line that could solely drive it.

Joanna Gajuk, Analyst

And would you say that with the strength, you feel things were getting better, but any change to your view for the year for this segment, or are you in the ballpark?

Steve Filton, CFO

Again, I'll echo Marc's comments. We envisioned that 2023 would transition out of the pandemic environment into a post-pandemic world. Our first quarter was strong, particularly on the behavioral side. That's how our guidance plays out for the year. We are feeling good about the trends continuing as the year progresses.

Joanna Gajuk, Analyst

Great. Thank you. And the last question on the Behavioral segment. When it comes to the redeterminations, states are starting this process now, many delaying it. So can you talk about how you think this will play out for behavioral business specifically? Do you assume anything in your guidance, or is it more 2024, if at all? And any comments on how this could impact the acute care business? Thank you.

Steve Filton, CFO

I think the truth is that nobody has a clear view of how redeterminations will affect either the behavioral or acute business. It depends a lot on the pace at which states go through the redetermination process. It also depends on how quickly individuals losing their Medicaid coverage can qualify for commercial exchange products. Our 2023 guidance takes redeterminations into account as being modestly negative for both segments, but that's largely a guesstimate. We are prepared operationally to make sure patients who lose their Medicaid coverage are supported in requalifying for other coverage.

Joanna Gajuk, Analyst

Thank you for this color. I appreciate it.

Operator, Operator

Thank you. One moment for our next question, please. All right. And it comes from the line of Steven Valiquette with Barclays. Please proceed.

Steven Valiquette, Analyst

Great. Thanks. Good morning. Not to get too granular on labor, but our monthly labor tracker showed the company had better momentum later in the quarter in February and March, especially in filling nurse job vacancies in both segments. So I would think that would also bode well for volumes in the second quarter. I'm not asking you to comment on monthly trends, but just curious if you can comment on the momentum for the company exiting the quarter on the labor front, and whether that also provides a positive bias for volume trends in the second quarter as well. Thanks.

Steve Filton, CFO

I would agree, Steve, that things improved broadly as the quarter progressed for both labor and volume. Our 2023 guidance reflects that trend. Traditional seasonality would not suggest things would continue to get better from the first quarter forward, but it seems to be playing out that way. We are encouraged that our guidance trajectory is aligning with current trends.

Unidentified Analyst, Analyst

Okay. Got it. Okay. Thanks.

Operator, Operator

One moment for our next question, please. All right. And it comes from the line of Pito Chickering with Deutsche Bank. Please proceed.

Pito Chickering, Analyst

Hey. Good morning, guys. Thanks for taking my questions. A follow-up to both Ann and Joanna's questions here. Can you combine both the new hires and turnover to quantify the net hires specifically in behavioral now compared to the first quarter versus the fourth quarter? And how many behavioral beds are you still unable to staff at this point, if any, and how does that track throughout the year?

Steve Filton, CFO

I don't have the net hire detail in front of me. What I do know is our net hires on the behavioral side have been positive consistently since the end of the first quarter of last year, and we expect that will continue. We don’t release precise numbers on capped beds, as it varies by facility. However, we continue to turn away significant numbers of patients because of either lack of available beds or staff. As we make progress on hiring, we expect to meet the demand that is already out there.

Pito Chickering, Analyst

Okay. Great. And then a follow-up question here. As you think about margin expansion in behavioral, over the next 12 to 24 months, how much is coming from filling those beds and leveraging fixed costs versus pricing running in the mid-single digits against wage inflation running in the 3% range?

Steve Filton, CFO

If you look at our 10% revenue growth in the first quarter, it was split evenly between price and volume. There's more upside on the volume side. Revenue per adjusted day may moderate as the year progresses, but I see volume growth in the mid-single digits as sustainable. Those patterns were significantly muted due to the labor supply disruption during the pandemic but should grow as we move forward.

Pito Chickering, Analyst

Okay. Great. Thanks so much, guys. Nice quarter.

Operator, Operator

Thank you. Please wait for our next question. Our question comes from Jamie Perse with Goldman Sachs. Please go ahead.

Jamie Perse, Analyst

Hey, thank you. Good morning. So, Steve, you previously guided to about 1% to 2% revenue per adjusted admission in 2023. You also said that was the more aggressive assumption in your thinking for 2023. So, getting through the tough Q1 comp, and I'm just curious how revenue per adjusted admission played out versus your expectations and how to think about that metric for the rest of the year for the Acute segment?

Steve Filton, CFO

Again, our comments were straightforward. Our acute performance in the first quarter was slightly below our expectations, mostly on the pricing side, as volumes were strong. We'll get a better view of this as the year progresses when COVID comparisons won't be as challenging. I don't believe being slightly behind in Q1 means we can't reach our full year expectations on the acute side.

Jamie Perse, Analyst

Okay. Thanks for that. And just on contracting tactics with commercial payers. You previously mentioned there were some contracts where you're potentially willing to walk away if payers didn’t meet you halfway. I'm curious how those negotiations have played out since. Are payers becoming more receptive to meeting providers at better rates? Have you actually walked away from contracts? Just any update there on the behavioral side in particular.

Steve Filton, CFO

The proof is in the pudding; we had 5% revenue per adjusted day growth in our behavioral revenue in the quarter. That certainly is above historical averages, which tended to be around 2% to 2.5%. In an environment of capacity constraints and our significant market share, payers not willing to meet us halfway see serious limitations for their subscribers to have their patients treated. We have been successful at negotiating better rates. Sometimes, we give notice of termination, and the contract never terminates, leading to a negotiated settlement. Other times, we formally walk away. The behavioral space does not have much excess capacity, and payers are becoming more reasonable when it comes to ensuring adequate treatment.

Marc Miller, CEO

And I just want to piggyback on this point. We're pushing much more earnestly on the issue of getting paid fairly for the work we do. We're explaining that some payers do not meet us halfway all the time, and that won't be adequate going forward. Additionally, we're having many discussions with payers that we've not had before as their needs grow on the behavioral side. We are the largest provider in the United States for behavioral health, so the leverage is shifting a little bit. We're working with them to ensure that it’s more conducive for them to pay us fairly so that their patients are serviced well rather than trying to keep rates low and failing to meet their needs in the process. These discussions are escalating, and we're confident we'll see more positive results from our conversations going forward.

Jamie Perse, Analyst

Thanks for all the color.

Operator, Operator

Thank you. At this time, I would like to turn the conference back to Steve Filton for closing remarks.

Steve Filton, CFO

Okay. Thank you. We'd like to thank everybody for their time this morning and look forward to speaking again next quarter.

Operator, Operator

And this concludes today's conference call. Thank you for participating, and you may now disconnect.