May 5, 2008
Operator
Good day and welcome to the Buckeye Technologies Inc. Third Quarter Earnings Results Conference Call.
Today’s call is being recorded. Presently, all parties participating in this call will listen to opening remarks made by the company.
After the prepared remarks, Buckeye management will answer analyst questions. At this time for opening remarks and introductions, I’d like to turn the call over to Mr.
John Crowe, Chief Executive Officer of Buckeye. Please go ahead sir.
John B. Crowe
Thank you Vickie. Good morning and welcome to Buckeye’s conference call commenting on our results for the January-March quarter 2008.
Today I’m joined in this call by Kris Matula, President and Chief Operating Officer; Steve Dean, Senior Vice President and Chief Financial Officer; Beth Welter, Vice President and Chief Accounting Officer; and Daryn Abercrombie, Senior Finance and Investor Relations Manager. After Steve and I have made some introductory remarks, we will respond to your questions.
First, Daryn will read our Safe Harbor Statement.
Daryn Abercrombie
Thank you John. Answers to questions and other comments may constitute forward-looking statements within the meaning of the Federal Securities laws.
Although management believes these statements are based on reasonable assumptions, these statements are subject to risks and uncertainties that could cause actual results to differ materially, including but not limited to risks relating to economic, competitive, governmental, and technological factors affecting the company’s financing, markets, order volumes, prices, products, operations, capital expenditures, and costs. Other risk factors can by found on Buckeye’s press releases and public filings with the Securities and Exchange Commission.
Additionally, non-GAAP financial measures may be discussed during this call. Any required disclosures with respect to these measures are provided in the investor relations section of our company website, www.bkitech.com.
John B. Crowe
Thank you Daryn. We had another good quarter with sales up 5% and earnings per share up 55% versus the same period a year ago.
I’d indicated in January it would be very difficult to repeat the outstanding operating performance of the October-December quarter. In the just completed quarter, the company’s earnings were $10.4 million after tax, 26 cents per share, including a $0.8 million, 2 cents per share tax benefit related to the identification of additional R&D tax credits.
This compares to earnings for the same period a year ago of $6.6 million after tax, 17 cents per share including $0.8 million after tax, 2 cents per share in restructuring expenses. Net sales of $201.9 million increased 4.6% compared to the same quarter a year ago.
We also reached a significant milestone in the just completed quarter as we reduced our long-term debt to $394.5 million. This achieves the $400 million debt target we established several years ago, and now positions Buckeye to pursue growth initiatives and opportunities.
While our earnings were substantially improved from the year ago period, our financial results for the just completed quarter fell short of our expectations. Sales for the quarter in our non-woven segment were up $14 million compared to the October-December quarter; $12 million of that reduction was due to the previously announced volume loss with a large customer and $2 million because of weaker than expected sales in North America, wet wipes market this quarter.
We continue to see strong demand and a strong pricing environment for our products in especially fiber segment of our business with sales up $3 million for the quarter compared to the October-December quarter. However, our specialty fiber sales were $3.5 million lower than we expected due to unplanned maintenance outages and delayed shipments due to outbound ocean vessel availability issues.
Now, Steve will review the supplemental reconciliation chart. Steve?
Steven G. Dean
Good morning. I would like to provide some additional color to the quarterly sales and earnings reconciliations included on the last page of this quarter’s press release financials.
Starting with the first column at the top of the page, net sales for the third quarter were up $8.9 million or 4.6% compared to the same quarter a year ago. Selling prices were significantly higher, up 9.4% on the average compared to the same period a year ago and accounting for $18.1 million in incremental sales revenue year over year.
Sales volumes have declined year over year accounting for a reduction in sales of $12.7 million compared to the same period in 2007, partially offsetting the impact of higher prices. This reduction in volume is mostly due to the previously announced volume loss with a large customer in our non-woven segment.
The impact of the stronger year added $3.2 million to our sales for the quarter. Selling prices were up across all segments of our business compared to the same period last year.
Selling prices were up approximately 9% for the quarter on our wood specialty products primarily as a result of price increases implemented in January. Prices were up about 15% year over year on our cotton specialty products due to price increases implemented over the course of the year.
Fluff pulp pricing increased by about $100 per ton compared to the same quarter in 2007 and nonwoven selling prices were up about 2% on the average excluding the impact of mix in prices. Moving to the second column, sales for the January-March 2008 quarter were down $9 million or 4% compared to the immediately preceding October-December 2007 quarter.
Lower shipment volume during the quarter reduced sales by $17.5 million versus the preceding quarter compared to a positive selling price effect of only $7.8 million. John already mentioned the $14 million drop in nonwoven sales in the quarter compared to the October-December quarter which consisted of $15 million due to lower volume offset by $1 million from favorable currency impact.
Sales for our specialty fiber segment were only up $3 million quarter over quarter as the impact of reduced shipment volumes offset more than half of the $8 million favorable impact of the January 1st prices increases. Production and shipment volumes from our peri-Florida wood cellulose mill were down about 7000 tons in quarter 3 versus quarter 2 while production and shipment volumes for our cotton cellulose mills were up about 2000 tons between the same period.
About half of the volume reduction in our Florida mill was due to the fact that we ran extremely well in the second quarter, had very few planned or unplanned maintenances outages, and benefited in that quarter from the timing of the quarter-end ocean shipments. Also, we did have one more day in quarter 2 than we did in quarter 3.
On the other hand, as John mentioned, sales for the quarter were lower than we had expected due to unplanned maintenance outages and delayed shipments caused by ocean vessel availability issues. On a fiscal year basis, year to date basis, production volume at this facility was actually up about 1% and shipment volume was down about 1%.
On the bottom half of the page, we have reconciled earnings per share for the same period. All these figures are of course net of taxes.
In the first column you can see that earnings per share for the third quarter of 26 cents per share were 9 cents higher than in the same period a year ago; 3.5 cents of this improvement in explained by our tax benefit in the current quarter and restructuring expenses in the year ago quarter. Another 3.5 cents is explained by lower interest expenses.
That leaves a 2-cent improvement from operations. Higher prices added 31 cents per share in earnings year over year, but costs were up 25 cents per share and the impact of lower shipment volumes knocked another 4 cents per share off of earnings for the quarter.
Costs were up 25 cents per share due to higher raw material, chemical, energy, and transportation costs along with the unfavorable impact of the stronger Brazilian currency. On a pre-tax basis, raw material prices were up $8.7 million year over year with cotton fiber costs accounting for $6.8 million of this increase.
Costs were also up for chemicals, $1.8 million, energy $1.4 million, and transportation costs $1.4 million over the same period a year ago. The stronger Brazilian currency cost us another $1 million year over year.
Lower capacity utilization in nonwovens accounted for an additional $3.5 million in cost increase from the year ago period. Finally, moving to the next comparison, earnings per share for the third quarter of 26 cents were 9 cents lower than for the preceding quarter ended December 31, 2007.
Pricing and product mix contributed a positive 13 cents relative to the October-December quarter as we implemented selling prices across our specialty fibers business of 7% to 8% and fluff pulp prices were up $14 per ton. Costs were up 20 cents per share.
Higher raw material, chemical, energy, and transportation costs accounted for about 13 cents and lower production volume accounted for about 7 cents. On a pre-tax basis, raw material prices were up $3.4 million quarter to quarter with cotton fiber cost accounting for 2.7 of this increase and nonwoven’s raw materials accounting for another $0.6 million.
Chemicals, energy, and transportation costs were each up about $1 million from the October-December quarter to the January-March quarter. The lower production volume was due to the loss of nonwovens business and issues affecting production volume at our peri-Florida wood cellulose facility both discussed earlier.
Lower shipment volume for our nonwovens business in our wood cellulose mill had the impact of reducing earnings by another 6 cents per share. The 4 cent improvement in the corporate other category on the table is due to the tax benefit from identification of additional R&D tax credits, lower interest expenses, foreign exchange gain.
Now I’ll turn it back over to John.
John B. Crowe
Thanks Steve. As Steve shared, we made progress during the quarter while dealing with several challenges.
We are pleased with the revenue and earnings growth the organization delivered for the first 9 months of fiscal year 2008. Year to date sales were up 7.2% over the same period last year.
This progress was made even with the decline in sales volume due to constraints on our cotton production from shortages of raw materials and a lower volume in our nonwovens. In our April 22nd press release, I shared that we had recently replaced a sizable portion of the nonwovens business that was lost since beginning of the January-March quarter.
We plan to add one production ship back at our Delta airlaid facility as this business begins to ramp-up later this quarter. We anticipate that sales revenue and operating income for our nonwovens material segment will increase by about $3 million and $1 million respectively this quarter over the just completed quarter.
We implemented selling price increases in January across our specialty fiber business of 7% to 8% and fluff pulp prices were up $14 per ton for the just completed quarter. Nonwovens selling prices were essentially unchanged.
However, in spite of these price increases, our margins were challenged due to higher raw material, chemicals, energy, and transportation costs, and lower production at our nonwovens in our Florida Wood Facility. The demand for most of our products continues to be strong and we remain in a sold-out position in our specialty segment.
Turning to new products and markets, due to the severity of the housing slump, we now anticipate year over year sales growth in UltraFiber 500 of about 10% versus our previously anticipated growth of greater than 30%. Customers value our UltraFiber 500 dispensing system and we now have over 300 dispensers in the field.
We are confident we will continue to grow this business through increased market share and new market applications for factors such as fire safety, formability, green fibers, and slap curling are important. Raw material availability in our specialty cotton fiber business continues to limit production.
The harvest of the cotton crop was smaller this year in North America. The cotton crop in Brazil this year was up 40% from the prior year, but the amount of seed de-linted and crushed for oil will not increase as much as we had hoped.
There is enough total cotton seed available in both North America and Brazil, and we are working aggressively on several initiatives to remove the lint from the seed before it goes into dairy feed. The additional source of linters will supplement the traditional linters coming from the oil crushing market.
The Americana plant is running at approximately 65% of capacity matching the raw material supply and continues to improve operating efficiency helping to reduce manufacturing cost. Profitability continues to be a challenge with sales constrained due to the limited raw material supply while our operating loss is down significantly year over year and we have been operating at near cash breakeven during this time.
We anticipate that Americana operating loss will remain in the $800,000 to $1 million range in the April-June quarter. For the rest of the calendar year 2008, we expect to operate Americana Brazil facility at its current rate of approximately 2200 tons per month assuming we are able to purchase sufficient cotton linters at a reasonable price.
The Memphis Tennessee Facility is expected to run at approximately 75% to 80% of capacity for the rest of the calendar year due to the constraints of the North American cotton price. The Foley energy project is moving forward and the savings potential continues to grow with a trend for mandates of renewable energy sources and with oil prices continuing to rise.
As a reminder, we are 1 year into a 3-year $45 million project which was based on a goal of an equivalent reduction of over 200,000 barrels of oil annually. At the completion of the project, our Florida Wood Specialty Fibers Facility will be about 93% energy self-sufficient.
Additionally, we will be capable of producing excess energy and electricity using only biomass. Complementing this project, we are studying several additional initiatives that have the potential to turn other waste streams into revenue streams as we reduce our environmental footprint and ensure our sustainability.
As we look forward to the current quarter, we should see a modest improvement in operating income versus the just completed quarter due to a combination of increased sales volume from our Florida Wood Specialty Facility and from our Delta nonwovens facility plus the impact of price increases we implemented April 1st. We anticipate these improvements should be sufficient to offset the inflation that we are experiencing in energy, chemicals, raw material, and freight cost.
In summary, we had a good quarter with key results of 4.6% growth in revenue year over year, 26 cents per share and 96 cents per share, quarter and year to date respectively; long-term debt is now below $400 million at $394.5 million, the demand for our air-laid nonwoven’s product remains solid and we are re-establishing growth and improving the financial performance of our nonwovens business. Our specialty price increases should be sufficient to offset negative impacts of higher input costs across the specialty fibers business.
If input costs continue to escalate, we will make every effort to further mitigate these costs in our operations as well as adjust prices as appropriate. This is where Lean Enterprise is critical to take out waste across the entire supply chain offsetting inflation and increasing input cost.
Improving our lint supply remains a priority and as more lint is available we will ramp-up our cotton facility. The energy project has increasing potential revenue opportunities for our Florida facility long-term.
We continue to pay down debt and reduce net interest expense. We have a team exploring external opportunities and strategies for growth and have engaged the entire organization to think creatively about growing our business to become a meaningful sized company, and we anticipate earnings in the April-June quarter will be similar to the just completed quarter with improved operating performance and a more normal tax rate.
We are now ready to respond to your questions, so I’d like to turn the conference back over to Vickie.
Operator
Thank you. Instructions.
We will take our first question from Gail Glazerman with UBS Securities LLC. Please go ahead.
Gail Glazerman
Hi. Good morning.
John B. Crowe
Good morning Gail.
Gail Glazerman
I guess if you could talk about the price and inflation situation in a little bit more detail, in particularly I guess more specifically what options you have if inflation continues where it is to repute pricing given the long-term contracts you have in place?
John B. Crowe
Okay. I’m going to let Steve break down the impact of those costs, but just let me say on the front end, Gail, as you know, we do have normally one annual contract in our specialty wood, we have been pricing in our cotton business more on a quarterly basis and certainly on our nonwovens we have fast screws on raw materials such as pulp and binder and other materials used in production.
Steve did a pretty good job of breaking down the cost escalations year over year and where they were, would you like some of those repeated or do you have specific questions?
Gail Glazerman
No, just more concerned about your ability to recover, but also I guess I’d be interested in what trends you’re seeing today versus as you ended the first quarter, is there any sort of stabilization, is it getting worse on the cost side?
Steven G. Dean
You’re asking about the escalation – if that has continued to go up, is that…?
Gail Glazerman
Yeah, just the general cost trend.
John B. Crowe
We’ve planned for them to continue to go up – I have no crystal ball that can tell me exactly where the prices are going to shake out, but we do do pricing with our suppliers on a quarterly basis, so we know what those contract costs are going forward month by month. Steve, you want to add to that?
Steven G. Dean
Yeah just one thing I would add Gail. When we’re looking at the April-June quarter compared to the one we just finished, the cost items that we’re expecting additional inflation in at the moment are mainly energy and transportation costs around ocean carrier freight rates.
Some of the costs continue to go up and certainly cotton fiber costs continue to go up dramatically.
Gail Glazerman
Okay, and then, specifically in terms of cotton, has there been any slowdown or push back in your ability to pass that along in your quarterly contracts?
John B. Crowe
I’ll let Kris speak to – so far, we’ve been capable of passing through the cost with our cotton customers and we signed – we had the annual contracts with our biggest customers in our wood business. I’ll let Kris answer the question as he’s been dealing with most of the customers.
There is a point where you reach where they are not going to be able to absorb anymore, and that again I said in my notes – that’s where working on Lean Enterprise across the supply chain helps you take out waste that then mitigates some of those costs. Kris do you want to respond to this?
Kristopher J. Matula
Yeah, I think the only thing that I’d add Gail to that is as we mentioned, so far, we have been able to pass through our linter cost increases to our customers. This is obviously one of the areas where we’ve had the most significant run-up in terms of costs as well as pricing.
At this point in time, it’s becoming more and more difficulty to pass through increased prices, and so that’ll be challenging if they continue to escalate – as we kind of look at the market for our raw cotton linters, that’s somewhat tagged to the viscose staple fiber market and what’s really been driving the cost of our raw material up – and as we’ve talked previously – there’s been a significant increase in demand and pricing for the viscose staple fiber used in textile applications over the last several years, and the pricing for that fiber appears to have peaked in late calendar year 2007 and has come down about 15% from there, and as the demand for this viscose staple fiber, while it is still expected to grow at the low to mid single digits, we expect the demand will continue to remain strong for those, but with some of the new supply coming on, we’re starting to see, particularly in China on the cotton side maybe a softening of the demand and pricing for cotton linters and so we’re hopeful that may give us some relief on the cotton fiber side, we’re not really seeing a lot of that right now, but we are hopeful that’s going to help us going forward.
Gail Glazerman
Okay, and just one last question, more strategic – when you talk about being below your debt target and looking at growth, can you talk a little bit I guess how you prioritize the use of any cash flow between growth and other uses such as dividend or buy-back?
John B. Crowe
Well, considering all the options of buy-back, right now the energy project at Foley is certainly a high priority forwards with cash – to continue that – we think also coming out of that project there are some other projects that we can implement that complement that turning other waste streams into revenue streams, so that will be a priority of course. Certainly, there are three ways we look at growth – one is to fill up our current assets since you know we have about 30% unused capacity right now on our cotton and if we had the raw material, we believe we could fill that up given the current market conditions and current customer needs and demands there.
Nonwovens were about the similar capacity utilization, so we have about 30% upside there and so that’s the first way to grow us organically – new products, new markets, and fill up our current assets. Secondly, as for extensions like energy project where we can find additional waste to create revenue out of current assets, and that’s a good example of where you could convert more of our boilers into biomass, generate more of our own fuels, and then with our turbine generator there, it will have about 50% excess capacity from what we need out of it and so we can actually return energy to the grid or sell it in the local community if possible; so a lot of opportunities there, and then certainly, the third way to grow that we would want to focus opportunity on is – that’s what the team is studying – that gets into the right merger, right acquisition that complements Buckeye’s assets.
Gail Glazerman
Okay, thank you.
John B. Crowe
Okay Gail.
Operator
We’ll take the next question from Chip A. Dillon with Citigroup.
Chip A. Dillon
Hi, good morning. In your discussion earlier you mentioned what you thought sales would do in this fourth fiscal quarter versus the third, and I think you mentioned something would be up $1 million and something would be up $3 million; could you just repeat what that was please?
John B. Crowe
Yeah, Steve you want to mention?
Steven G. Dean
Yeah we were referring to nonwovens since we have managed to replace a sizable portion of that business. We expect the sales to increase $3 million between the quarter just completed to the next quarter; earnings to increase $1 million.
Chip A. Dillon
Gotcha. Okay.
And then as you look at the – and I believe the overall company expects the operating income to be up modestly in the fourth versus the third as costs eat up a lot of the price improvement but not all of it.
John B. Crowe
That’s correct.
Chip A. Dillon
Okay, and volume improvement – and then, speaking of your priorities, what do you think the CapEx will end up at for fiscal ’08, and what sort of an early look with these projects you’re looking at for fiscal ’09.
John B. Crowe
Chip, let Kris answer that for you.
Kristopher J. Matula
Chip, we’ve indicated that this year our standing was going to about the $50 million level; it may be slightly less than that, but roughly $50 million. In terms of looking forward, we’re in the process of developing our capital budgets at this point in time.
We have not finalized that or put that together, but I would anticipate there’s going to be an increase this year coming up versus the current year we’re in because we started to get into more of the meat in terms of spending for particularly the energy project, and that’s the figure that we’ll be able to give you at our next call.
Chip A. Dillon
But a number like 70 would that be high or could it be that high?
John B. Crowe
Sound high to me.
Chip A. Dillon
Okay, so, higher than we are now, but not as high as that.
Kristopher J. Matula
That’s correct.
Chip A. Dillon
That’s fair. Okay, and then when you look at the – you mentioned how the cotton linter market, and Kris you were mentioning how it has been impacted by – I think – not rayon staple – what did you say it was?
Kristopher J. Matula
That’s rayon or viscose staple – people call it by either rayon staple fiber or viscose staple fiber.
Chip A. Dillon
Okay, and is that impacting your ability, you think it will impact your ability to raise prices in your wood specialties – all things being equal?
Kristopher J. Matula
No Chip, we don’t believe so. If we look at the markets that we serve, we serve the very high end; first of all we don’t sell into the viscose staple or the rayon staple market with our high-end wood cellulose, and so as we look at – that market did give very strong this last year and if you remember, some of the selling prices going into the market for pulps were even higher that we were getting for our high-end pulps, but that was our market that we continued to not supply into – if that market softens going forward and with some of the new capacity coming in onto the low end, the pricing of that market may well go down some; most of the new capacity that’s coming in will at least initially be targeted more in that low end apple range; so we believe that while longer term maybe there could be some more pressure in the near term, we don’t expect to have any pressure from that standpoint.
Chip A. Dillon
And how do you guys see the fluff market, is that still as strong as it has been, are prices still more in a firming mode or flat mode at this point?
Kristopher J. Matula
Yeah Chip, at this point in time the demand for fluff pulp continues to be very strong and so we see that market continuing to remain very firm.
Chip A. Dillon
Okay, and then some tax rate guidance – again, I’m sorry I missed that – what do you think of your book tax rate for the fourth quarter and for next year?
John B. Crowe
Steve?
Steven G. Dean
Chip I would expect we would be in the 35% to 37% tax rate range.
Chip A. Dillon
Gotcha, okay. And then the last question is – earlier question was about cash flow priorities – at what point – not to just give us a price, but I would imagine that if you look sort of at your balance sheet today versus five years ago, you guys deserve a big pat on the back for how you’ve reduced that net debt close to half, certainly 40%, and as I would think that gives you some flexibility if at some point the stock price got to a ridiculous level, and do you have an open authorization, can you jump in if you wanted to at this point to buy the stock because as you know in the last 7 or 8 months or a year – let’s say now – you’ve had some pretty incredible days that if someone had been sitting there, they could have taken and risked everyone else who owns a stock by buying from whoever is dumping it at that time.
John B. Crowe
I agree with everything you said Chip, and Steve, would you address a little bit on some of the thoughts we have on this?
Steven G. Dean
Yeah. Chip, just to answer part of your question – yes, we do have an open authorization from the board to buy back.
I think we have between $900,000 to a million shares available, and we would consider in a modest way doing some buybacks at some point in time under that level.
Chip A. Dillon
Gotcha. Okay.
Thank you.
John B. Crowe
Thank you Chip.
Operator
At this time there is one name remaining on the roster. So if there are any additional questions, please press *1 at this time.
And we’ll now go to Napoleon Overton with Morgan Keegan.
Napoleon Overton
Good morning. Could you clarify for us exactly what you mean by the ocean vessel availability issues referenced in your press release?
Is that anything beyond the last day of the quarter issue that pops up from time to time?
John B. Crowe
I’m going to let Kris share some with you on that Nap.
Kristopher J. Matula
Yeah. Nap, if you look at the overall ocean availability issues we have – you probably have seen, read, and heard at different places – with the weak US dollar and lots of exports, just the full utilization of the ocean shipping vessels has gotten very tight, and so in addition to having a typical situation where you might have a vessel that rolls from one quarter to the next, you’ve really got a situation now where you have to book much further in advance to get space on a ship, and if you have a last minute change in either a customer need or a production schedule, you don’t just easily roll that to the next ship.
You may be out now 4 weeks, 5 weeks, or 6 weeks before you can roll onto another ship, and so in that sort of a situation, you just have a lot less flexibility of getting your products out. So that’s the challenge it puts in the system now.
And obviously the cost of ocean transportation as well as other transportation has been going up fairly significantly here over the last several quarters. That’s the challenge we as well as others will have going forward in terms of the availability.
Napoleon Overton
Okay. And separately, I have seen more cautious kind of commentary in some of the industry rags that I look up from time to time about market pulp pricing, and so – I know you did – because you may have already answered the question because you just said you are quite confident that fluff pulp pricing is going to remain strong for the foreseeable future.
You are not more cautious now than you were six months ago about the outlook for fluff pulp pricing.
John B. Crowe
I don’t think so. It keeps moving on, it’s 3 months, 6 months at a time – people predicted it would fall last fall, but we still see a strong demand and strong growth for fluff pulp in many applications throughout the world.
So, the announced capacity that has been coming on seems to be coming on at a pace that matches the growth. So, it seems to be still well, but that said, I don’t have a crystal ball and things can change.
The debate whether we’re in a recession, not in a recession, whatever then – the things can change pretty rapidly. So, we’re cautious, but no more cautious than we were this time last year.
You agree with that Kris.
Kristopher J. Matula
Yeah. The only thing I would add to that is – fluff pulp like other pulps still are cyclical in terms of their pricing behavior.
So there will be a point in time where they start to soften, but as far as we see right now, the demand is still very solid.
Napoleon Overton
Okay. And then, finally last quarter you mentioned the loss of that significant nonwoven customer and indicated that that was a good piece of business and that you hated to see it go.
Could you give us any color on the kind of business that you are replacing that production capacity with?
John B. Crowe
Well, I can give you a little bit without – we don’t mention customers – but I can mention that the business that we’re getting back is actually – we shared with you last time that we couldn’t lower prices to keep the business. We would have liked to have kept the volume.
This business actually is in some ways better for our side. It is not as much volume back – I think we’re going to agree to say that we anticipate getting about 60% of the volume back at Delta that we lost.
So we still have some growth to do albeit at a better margin.
Napoleon Overton
Thank you. That’s helpful.
Appreciate it.
John B. Crowe
You are welcome.
Operator
There is no one else in the queue. So, Mr.
Crowe, I’ll turn it back to you for any additional or closing remarks.
John B. Crowe
Okay Vickie. Thank you and thank you people for participating with us today, for taking time, and for your questions.
We look forward to discussing our business results with you in our August conference calls. Thank you and a good day.
Operator
Thank you very much. That does conclude our conference for today.