Hello, and welcome to Westrock Coffee Company's Third Quarter 2022 earnings conference call. My name is Chris, and I'll be coordinating your call today. Following prepared remarks, we will open the call to your questions with instructions to be given at that time. I'll now like to hand the call over to Clay Crumbliss with ICR.

Thank you and welcome to Westrock Coffee Company's third quarter 2022 earnings results conference call. Today's call is being recorded. With us today are Mr. Scott Ford, Co-Founder and Chief Executive Officer, and Mr. Chris Pledger, Chief Financial Officer. By now everyone should have access to the company's third quarter earnings release issued earlier today. This information is available on the investor relations section of Westrock Coffee Company's website. Certain comments made on this call include forward-looking statements, which are subject to the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are based on management's current expectations and beliefs concerning future events and are subject to several risks and uncertainties that could cause actual results to differ materially from those described in these forward-looking statements. Please refer to today's press release and other filings with the SEC for a more detailed discussion of the risk factors that could cause actual results to differ materially from those expressed or implied in any forward-looking statements made today. Also, discussions during the call will use some non-GAAP financial measures as we describe business performance. The SEC filings as well as the earnings press release provide reconciliations of these non-GAAP financial measures to the most directly comparable GAAP measures. And with that, it's my pleasure to turn the call over to Scott Ford, our Co-Founder and Chief Executive Officer. Scott?

Thank you, and good afternoon, everyone. Welcome to our inaugural public company quarterly earnings call. It has been quite the journey from our startup days in 2009 with $1.5 million in annual revenues to the business you see today, all of which I believe will pale in comparison to what we are about to do over the next five years. As many of you know, we started Westrock Coffee Company in 2009 when we saw the need for a new business model that would help ensure smallholder farmers in the developing world are paid a fair price for their coffee crop. Our business model, which is not predicated on us receiving charity or charging our customers premium prices, is most effective when we ourselves deliver superior financial results. So, while we are a dual-purpose organization, we are first and foremost a commercial enterprise because the better we do as a business in the developed world, the more we can do for farmers in the developing world and the better stewards we can prove to be for the investors who trust us with their capital. As we profitably grow our business, we create greater demand pull for coffee to enter our supply chain, which in turn allows us to expand the number of farmers whose crops we purchase, through which we essentially underwrite the price of coffee in that community. What started in Rwanda as a single export mill through organic growth and via acquisitions is today the leading integrated coffee, tea, and extract manufacturing company in the United States. We have to thank for this our shareholders who believed in our future success when it was hard to see exactly how it would come to pass. Our customers who continue to select us for an ever-broadening array of products and services across an ever-widening geography. Our employee partners whose passion and commitment to making a positive difference in the lives of everyone we serve up and down the supply chain is unmatched globally and the farmers in 35 origin countries, without whose trust and trade we would have no business to report on. Now we operate our business while purpose and farmer impact-focused as a brand behind the brand's model in the developed world, and the significant announcements we are making today shed light on both our progress to date and our capacities and potential over the next five years. Before I turn the call over to Chris Pledger, I'd like to bring your attention to two very significant announcements we are making related to the growth of our extract and ready-to-drink manufacturing operations. First, we are pleased to announce that in response to the strong demand for the products we plan to produce from the previously announced Phase 1 expansion of our extract and ready-to-drink facility in Conway, Arkansas, coupled with the additional capital beyond the pipeline that we raised through our recent SPAC merger, we now plan to bring forward the manufacturing and packaging capabilities previously planned for Phase 2. Accelerating the Phase 2 capital spend into Phase 1 timing means that in addition to the basic extraction capabilities and high-speed can and glass bottle lines planned for Phase 1, we will now add enhanced extraction and soluble capabilities, a multi-serve bottling line, and several bag-in-a-box lines. You'll recall that all of our previous long-term guidance was built solely on the completion of our original Phase 1 planning, while not coming online in time to materially impact our 2024 EBITDA. This acceleration of Phase 2 of those capabilities should allow us to continue to commensurately grow our adjusted EBITDA into 2025 and beyond. Secondly, we are thrilled to announce that earlier today we closed on the purchase of Kohana Coffee out of Richmond, California. Kohana, owned by Jonathan and his father, Steve Reinemund, the former CEO of PepsiCo, brings with it a fabulous team, two additional ready-to-drink extract packaging formats, and a number of important national customers. The Reinemunds will be rolling their equity in Kohana into Westrock Coffee, which I think speaks volumes about what we believe we can collectively do in the emerging ready-to-drink space, especially given their deep history in the beverage industry. Taken together, we believe these two developments materially accelerate our product-to-market timing, allowing us to bridge demand for a number of important CPG customers who are ramping up their own sales of RTD beverages driven by their quickly accelerating end-customer demand. Finally, I want to thank the team at Westrock Coffee, who in spite of the unimaginable headwinds of quickly inflating costs and the attendance suppression of consumer demand brought about by this substantial rise in gas prices this summer, still managed to deliver adjusted EBITDA growth of roughly 30% year-over-year. And while we are all disappointed that macroeconomic headwinds are going to prevent us from achieving the 50% adjusted EBITDA growth we planned for, I am super thankful and respectful of all the team did in the midst of this inflationary storm to deliver yet again record financial results year-to-date. Chris?

Thanks, Scott, and good afternoon, everyone. Given that this is our first earnings call as a public company, I'll begin with a quick overview of where we are as a company year-to-date, provide a wrap-up of our recently completed third quarter, and then close with some comments on where we stand relative to our expectations for 2022. When you look at what we've accomplished as a company, 2022 has been an exceptional year for Westrock Coffee. On a consolidated basis, our net sales are up 26% year-to-date, and our adjusted EBITDA is up 29% year-to-date. With the closing of our SPAC merger with Riverview Acquisition Corp in August, we raised approximately $300 million in common equity and $350 million in debt in what can best be described as a very challenging financial market. We ended our third quarter with approximately $90 million of cash on our balance sheet and $175 million undrawn revolver. We made the decision to go public to position the company to capitalize on the consumer shift from hot black coffee to cold coffee-based beverages through the build-out of our extract and ready-to-drink facility in Conway, Arkansas, and allow us to expand our operations internationally to meet the growing needs of our customers. With our new capital base and the leverage it creates for the company, we have everything we need to be able to execute on that plan. Turning now to the results of our third quarter. Total company sales increased 27% to $230.3 million. Total company gross profit increased 7% to $41.1 million, and total company adjusted EBITDA increased 33% to $17.9 million. While we continue to experience significant growth on an absolute dollar basis, our gross profit and adjusted EBITDA margins have come under pressure from higher labor and material costs. For example, coffee represents approximately 60% of the total cost of our products, and we have experienced 45% price inflation on green coffee purchase costs compared to the third quarter of 2021. As this cost is pushed through our net sales as a pass-through, our overall margins compressed, even though the dollar gross profit and dollar adjusted EBITDA remain largely unchanged; the reverse is true when coffee prices decrease. This is why we focus on absolute dollar adjusted EBITDA growth as the best measure of our performance. Our beverage solution segment contributed $173.5 million in net sales, which represents year-over-year growth of 25% and adjusted EBITDA at $15.9 million, which represents year-over-year growth of 39%. Our sales growth was driven by a 59% increase in single-serve cut volumes and higher underlying green coffee prices that were largely passed through to customers during the quarter. This growth was partially offset by a 9% decrease in gross and ground volumes. Broad-based inflation continues to impact both our sales, particularly in our restaurant and convenience store channels, and our operating margins as our labor and material costs continue to grow. Despite these headwinds, our gross profit grew 9% driven by a positive product mix shift meaning sales of single-serve cuts and extracts, which are our highest-margin products in our portfolio, continue to represent a growing and greater percentage of our total sales. Despite growing dollar gross profit, our gross profit margins decreased by 310 basis points, largely driven by higher material costs, which we pass through with a component of both our net sales and our cost of goods sold. Our adjusted EBITDA growth was driven by the flow through of increases in gross profit and reduction in SG&A primarily related to personnel cost savings, partially offset by higher depreciation and amortization costs. Turning to our sustainable sourcing and traceability segment, our SS&T sales net of inter-segment revenues grew 34% to $56.8 million in the third quarter of 2022, primarily driven by higher average green coffee prices. Our SS&T segment contributed approximately $2 million in adjusted EBITDA in each of the third quarters of 2022 and 2021. The SS&T segment continues to perform well through periods of complex supply chain and inflationary pressures, which speaks volumes for the leadership and the team we have in place. During the quarter, we incurred approximately $7.8 million in capital expenditures, approximately $4 million with gross CapEx tied to single-serve expansion in our Little Rock, Arkansas facility and extracts capacity expansion in our Concord, North Carolina facility with the balance being spent on customer beverage, equipment and maintenance. Turning to our extract and ready-to-drink facility in Conway, Arkansas. We originally planned to build this facility in phases, with Phase 1 costing between $180 million to $190 million in CapEx and generating between $50 million and $60 million of adjusted EBITDA once we were operating at planned capacities. By investing the additional equity capital we raised in our SPAC merger and improving our working capital utilization, we're able to pull forward into Phase 1 the enhanced extraction and soluble capabilities and the additional packaging lines we had planned to install as part of Phase 2. This bringing forward of Phase 2 will cost an additional $90 million to $100 million in CapEx and should generate incremental adjusted EBITDA in a range similar to our original expectations for Phase 1. In October, we began making equipment deposits and expect to spend approximately $40 million of CapEx during the remainder of 2022 on the Conway facility. More importantly, we're assembling a world-class team of experienced manufacturing professionals to lead the build-out and ultimately the operation of the facility once it's commissioned. We're currently on schedule to begin producing and delivering products to customers from that facility in the first half of 2024. With respect to our balance sheet, at quarter-end, we had approximately $266 million of unrestricted cash on hand and undrawn revolving credit commitments. Our consolidated net leverage ratio at September 30th was 2.1 based on third quarter annualized adjusted EBITDA. We believe that we have ample access to liquidity to achieve our near-term growth targets and capital expenditure needs. Now I'd like to take a moment to discuss where we stand relative to our net sales and adjusted EBITDA guidance for the year. Our 2022 financial results have been impacted by three main factors. First, inflation generally, and more specifically, higher gasoline prices in July and August had a significant negative impact on US consumer spending, resulting in lower product sales in our away-from-home channels, particularly restaurants and convenience stores. We began to see this ease in mid-August leading to a more normalized sales volume in September. While this list certainly helped balance out the quarter, it was not sufficient to make up for lower sales earlier in the quarter. Second, it has taken us a little longer and cost a little more in terms of equipment, labor, and materials to absorb the 59% increase in single-serve cut volume we received in the third quarter. The good news is that the volume of orders is as we expected, and as we continue to stabilize our growing single-serve platform, we feel very good about our ability to more efficiently monetize these increased product volumes. Third, our team has done an absolutely fantastic job of executing against our plan and managing cost in a high-inflationary environment. Year to date, through September 30, we have generated $640.1 million in net sales and $42.6 million in consolidated adjusted EBITDA. While this represents year-over-year growth of 26% in net sales and 29% in adjusted EBITDA, it's approximately $69 million in net sales and $8.4 million in adjusted EBITDA behind where we previously planned to be at the end of the third quarter. Roughly half of our adjusted EBITDA shortfall is attributable to lower volumes in 2022, and roughly half of it is attributable to the natural lag that occurs as our higher material and production costs get pushed through to our customers pursuant to their respective pricing formulas over the next two to four quarters. Given the continued uncertainty of the macroeconomic environment, we are updating our outlook for the year and now expect to achieve net sales in a range of $850 to $890 million and adjusted EBITDA in the range of $60 to $63 million. While we are perhaps two quarters behind where we had planned on our short-term adjusted EBITDA expectations, the acceleration of capabilities we've announced today should allow us to continue to grow our adjusted EBITDA into 2025 and beyond.

Our first question will come from Chris Growe of Stifel.

I just wanted to get a little bit more update on your updated EBITDA expectations for the year and just to better understand the pass-along feature of the higher costs. We always think of that as being kind of in line with the cost, but there is some lag, I guess, in that coming through and that's causing some of the shortfall to date and then maybe some you expect also in the fourth quarter. Is that correct?

Yes. Let me walk you through, let me kind of walk you through the bridge, and there are a couple of different factors at work. I think first of all, the biggest influences, roast and ground volumes being down 7% year-to-date and 9% in the third quarter. So if you look at our roast and ground coffee volumes compared to last year, they're down. We've done a really good job of passing through higher material costs, and inflation has certainly been a major impact on our performance this year. But our ability to be able to pass through those costs—we've done a very good job of being able to do that. We're limited by the pricing formulas that we have with our customers in terms of timing, and so that does create some lag. So that's part of the story, but it's only a small part of it. The other thing at work is the single-serve cut volumes are up 59% year-over-year. And while we didn't monetize everything we had planned to in the third quarter, as we continue to bring that platform under stability, we'll continue to see that flow through our financial results. If you look at the $75 million EBITDA guidance that we provided at the beginning of the year, when we got to the end of the first half of the year, we were probably $3 million behind where we thought we'd be at the point in the year. Given the seasonality of the business and the growth expectations around the back half, $3 million is something that can easily be made up in the last six months of the year. We ended up about $4.5 million and through the end of the third quarter, $8.4 million behind where we thought we'd be—that was largely driven by volumes offset by cost push through, and then the increased single-serve cut volumes. And so we think as we get to the end of the year, we'll finish somewhere between $60 million and $63 million.

Chris, those are the absolute correct pieces. But to go back to your initial question, is there a lag on the pass-throughs? There definitely is. It can be six months, it can be up to 12 months. Most of the time coffee passes through on a quarterly basis, but several of the material components pass through on a 6 and 12 month basis.

Okay. Thank you for that. I guess just looking ahead then, volume is one component of the weaker outlook, I guess, and obviously the lag, you'll pick that up. As you look ahead to your expectations for coffee prices, which have been coming down a little bit, I guess that along with your volume outlook for the business, I just have to get a little more sense of how much of those do you expect to contribute to the EBITDA performance over the, say, the fourth quarter in the next year? Are we seeing any relief on the input cost side, and do you expect volumes to improve at all? I guess is what I'm ultimately asking there.

I can't make a prediction on volumes. They've been about the same pace behind. I think if you look at July with the higher gas prices and the impact of higher gas prices on the consumer, July was a bad month for coffee volumes. Other than that, it's been fairly stable, running about 5% to 7% behind. I think in terms of the lower coffee prices, we're fixed out with our customers for three to six months in advance. And so in the short term, it's probably not going to have an impact. But the lower coffee prices certainly create incentives for our customers to come into the market and buy going forward. So I do think we'll see a benefit of that in 2023. But seeing that in the fourth quarter of 2024 is probably not likely.

Our next question will come from Ben Bienvenu of Stephen's Inc. Your line is open.

I want to ask about the decision to pull forward Phase 2 and the investment there. You guys had talked about robust demand and kind of the nature of the capacity you were building being oversubscribed, and hence we have a pull forward. Could you talk a little bit about the visibility of demand and utilization of the capacity and capabilities you'll be building as you made the decision to pull forward that investment?

Sure. First of all, let me go back and reset the context just briefly on Phase 1. In our investor deck when we went public this last summer, we had talked about doing capital expenditures of roughly $180 million with the expectation that Phase 1 would generate $50 million to $60 million of EBITDA. What happened after we made that announcement was a marvelous thing; we had a lot more demand for the products that are going to be produced in Phase 1 than we would've expected. We have already signed up under contract, so not just an LOI, but we've signed up under contract roughly 70% of all of the production of Phase 1, and it doesn't even come online until 2024. The demand for the remaining 20-30% that we have available is almost two and a half times oversubscribed. And we are working through right now, frankly, trying to take care of as many of our customers in Phase 1 as possible. As we were working through that in the dialogue with our customers, it became evidently clear that their demand for more than just canned and glass bottle products as you move into the ready-to-drink space was running as hot as their demand for can and bottles. And we were encouraged to actually accelerate Phase 2, which is what those products were designed to be in. Phase 2 is essentially $100 million more in CapEx and should generate as much EBITDA as Phase 1 once fully sold and fully brought online. We have actually started to work on the implementation of Phase 2 now, and we're entering planning for Phase 3. Now we're talking about bringing five-year forward CapEx into the next two years. We are accelerating our five- and seven-year capital plans into the next two or three, simply because we can sell it all under largely take-or-pay contracts now. So that's the overall picture that we're looking at, and it is materially better once those various packaging and extract clients come on than we have previously contemplated.

Okay. That's great. And then if I could shift gears a little bit to the acquisition you announced today. From your comments, the purchase of the transaction is going to be funded entirely with stock or equity, and are there any terms that you can provide us with, whether it be valuation and or earnings contribution as well as maybe a little, if you could expound upon kind of the nature of the business, and how you guys came to get linked up with them?

Yeah, sure. Well, this is a business run by Jonathan and Steve Reinemund, and it is just a fabulous set of products that they developed over the last year or two, where they have developed a strong following in major retailers and CPG brands, other coffee companies; they serve the kinds of markets that we do in that space. What we—I’ll let Chris take you through the actual numbers of it, but the thing that we saw was not only a great partnership with Kohana, but the ability to pick up two extract lines, one of which was going to be different than anything we were going to do in the type of bottle that it is. But the second one was a small specialty can line, and it's not small, but it relative to what we're doing in Conway, I guess it is—we always had a plan in Phase 2 or 3 for a specialty canned line. Instead of putting it in Conway, we're going to do it in Kohana’s facility in California. We're going to make capital expenditures of a few million dollars, which will allow us to nearly triple that capacity. And just like in Conway, all of that capacity, even the tripling of it— that won't happen until the next four to six months, it's all already spoken for. So what this does is give us a new set of products with new blue-chip customers that we can bring onto our platform that might buy these kinds of products and the other products that we make for this type of customer. And it does it in a fashion that's 12 months to 18 months sooner than we could have gotten these stood up in Conway. So that's what it is and why we're doing it. We're thrilled to have the Kohana team join us. We're thrilled to be able to pick up the products that they make, the customers they have, and then start to introduce them to the other products we make, and it accelerates the timeline. Chris, you want to walk through the numbers?

Yeah, and just in terms of the purchase price, the overall purchase price for Kohana is $34.5 million. About $18.5 million of that is going to be—the equity portion of their initial investment that's getting rolled into Westrock Coffee Company stock. The balance is the extinguishment of debt on the company, and then about $3.5 million of transaction fees associated. So it's a combination of equity and cash, but the equity portion of the base business is rolling into Westrock stock.

Next question will come from Todd Brooks of the Benchmark Company.

Quick follow-up question on Kohana if I can. I think, Scott, in your comments, you talked about—and you guys talked about this during the deal process as well—the ability to build a bridge to a kind of capacity that allows you to unlock some of the CPG demand that is coming with Kohana. Can you talk about maybe Kohana as that unlock for you to be able to start to service some of these customers earlier and maybe talk to their capacity picture if they had incremental capacity that you guys are going to be able to utilize now in place, or if it will require the CapEx that you talked about? And I have one follow-up afterwards.

The short answer is when we started working with them a few months ago, there was a reasonable amount of capacity left available in the line that they have. They have actually done a really nice job of filling that up. And as companies that are in the ready-to-drink coffee space have been looking around for capacity, the Kohana team did a really nice job of lining some of that up. And they have essentially on their own filled their own capacity. So the $3 to $5 million in capital that we're going to spend to triple their canned line capacity, we have customers that will fill that up, and they are some of our blue-chip, serious large CPG brands that are in multiple other platforms with us, not cans obviously, because we don't do cans yet, but that need cans. This is a runway for us to bring them on literally 18 months sooner than we were going to be, which is a material and important thing for some of our top customers. So that's why we were looking around at the Kohana acquisition. And then as we got into it, we said not only is it a really nice investment where we have great certainty about the multiple we're paying on a forward basis, but we are bringing the customer set to fill the facilities. Those were facilities we weren't going to put on a specialty can line until deep into Phase 2. So our customers have been thrilled with the acceleration of timing for them.

That's great. That's helpful. Thanks, Scott. And then I don't know if there's a way to tackle this because a lot's changed. So we have the inflationary pressures this year and the new thinking around 2022 EBITDA guidance, but we have the Kohana acquisition, we have the acceleration of Phase 2 at Conway. I don't know if you can qualitatively or even quantitatively tackle kind of that forward projection of what these steps have done to accelerate the EBITDA base as we start to look a couple of years out.

Yes. Now it's a great question and it goes to the heart of, well, what window of time do you want to look at, right? About 90% of the common stock in Westrock is owned by people that we know. The first and last names of all of whom are looking at a three to seven year window to ride this phenomenon. It's nothing short of a phenomenon in the coffee ready-to-drink space. The fact that gasoline went to $6 this summer was unfortunate. The fact that 30% fewer, according to industry articles that were written, of people that had to stop and get gas—30% fewer even went into the store, right? $6 gasoline is a serious sorter in the average family's life in terms of what they can afford beyond gas to buy. We watched them trade down which restaurant they went to. We watch them hunt through what's the average meal ticket per person. We watch them buy smaller and smaller packages at retail. They started at a 100 count, they went to a 50 count, they ended up at a 12 count. They were doing everything they could to stretch their wallets in the July, August, and September timeframe when gas was really high. Now, all of that is understandable. It's straightforward. Chris walked you through the details. Some of that will pick back up over the next four to six quarters as we reprice costs through people's contracts, and all of which, if you're looking at it the way I do—and I don't mean this in any kind of grandiose way—but if you're looking at the business for what you think it can be over the next three to five years, it's kind of immaterial because what we're talking about in Phase 1 is as big an EBITDA generator as our whole business is today. Phase 2 is bigger than that. Phase 3 is as big as Phase 1 and Phase 2 combined. We're talking about 10 years of EBITDA growth. We're going to pull into about three or four, and if that's—if what gas prices did in July is what you want to focus on, I get it. There are investors who don't want to own the stock long-term and are looking at specific short-term issues. They’ve got some to pick on, no running away from it. If you think that it has at all changed what we're trying to accomplish, and you look at the contracts that the largest coffee brands in the world are signing with us today for their needs, it is irrelevant and going to be unfindable on a five-year basis. So depending on who the audience is, I'm glad to have either conversation.

Thank you. And one moment please for our next question. Our next question will come from Sarang Vora of the Telsey Group. Your line is open.

Thank you. Thank you, guys. Great, the news in the release, but let me start with the—first on the fourth quarter. The downtick in guidance that you talked about, Chris, how much of that is more about SS&T business because the commodity prices are coming down versus the beverage solution? I know there's a volume that impacts the beverage solution, but just curious to know, like if you could help us understand, like, you know, is it more about the commodity prices, more about the volume? Just curious to know.

No, it's more about the volume and it's more about the volume and beverage solutions. The SS&T business has really kind of chugged along this year exactly where we expected it to be in terms of the kind of financial performance. I think the—so it's all around volume and beverage solutions.

That's great. And you know, when you, it's great to see the acceleration in Phase 2, but you know, as you start, like, you know, the process of ordering the equipment, are you seeing any supply chain issues with the manufacturing right now? Or you still remain on track for opening in the first half? And will Phase 2 also open along with in 2024, or will it be at 2025 and the Phase 2 opening? Just curious.

Yeah, so we are at this moment in time on time and on budget for first half of 2024 opening of Conway. Roughly 70% of all of that Phase 1—original Phase 1 volume is under contract. We're—are opening Phase 2 marketing officially this afternoon after this call. Most of that will come on in late '24, so you won't see it impact the '24 numbers. But you will see in '25 and '26 EBITDA that under our original thinking, which was all outside of the guesstimates we had to do over the three-year forecast period for our filings, we're talking about EBITDA that we expected to bring on in maybe '27, '28, '29. We're talking about bringing some of that on now in '25, '26. So it is additive to the '25, '26 numbers as those assets come on late '24 is our current thinking. The other thing that— the other material thing in Conway, and we put out a smaller press release on this last week, is that we have brought in two really world-class manufacturing executives, including to be the VP GM, if you will, of the Conway facility. We went out after the world's finest plant operating leader in the ready-to-drink space that had done these exact products for these exact types of customers in the canned and bottled and extract world. Severet Smith joined our team about six weeks ago now, previously with another firm that did similar kinds of canning and bottling. Nicolas Lorenz has joined us from a large plastic operation in Germany. He is a world-class seasoned executive, and those two guys are now putting together the team. We've got about a 10 or 12 person senior leadership team in Conway from quality, product development, safety, etc., and they're putting that team together. All of that is on time and on schedule as well right now. And we are thrilled to have those two guys and several people that they're bringing on board already. All right. Well, we appreciate your interest. We appreciate your support. We'll be around to follow up with questions through the normal course. I think we're going to be at the Stephen’s Conference in Nashville on Wednesday. And we look forward to conversations with you as we go into the end of the year. Thanks so much.

This concludes today's conference call. Thank you all for participating. You may now disconnect, and have a pleasant day.