Good afternoon, and welcome to Franklin Resources Earnings Conference Call for the quarter ended March 31, 2014. My name is John, and I'll be your conference operator today. Statements made in this conference call regarding Franklin Resources Inc., which are not historical facts, are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements involve a number of known and unknown risks, uncertainties and other important factors that could cause actual results to differ materially from any future results expressed or implied by such forward-looking statements. These and other risks, uncertainties and other important factors are described in more detail in Franklin's recent filings with the Securities and Exchange Commission, including -- in the risk factors and MD&A sections of Franklin's most recent Form 10-K and 10-Q filings. (Operator Instructions). Now I'd like to turn the call over to Franklin Resources' CEO, Mr. Greg Johnson. Mr. Johnson, you may begin.

Hello and thank you everyone for joining the call today with me in our studio in San Mateo is Ken Lewis our CFO. Before we address any questions you may have regarding the earnings release of 10-Q that we filed this morning, I’d like to make sure that you are all aware of our upcoming Investor Day in New York on May 22. Key leaders and investment professionals from across the Franklin Templeton organization are joining us for what should be a very informative day, so hopefully we’ll see you there. If you cannot attend in person, the event will be webcast. The agenda and registration instructions are available from our website or by contacting investor relations. Now turning to our quarterly results. I think overall we feel that it was a very solid quarter. Most importantly, investment performance remained strong, and although we did experience heightened redemption activity in certain products and regions during the quarter, pre-market organic asset growth was strong in several other areas. With that, we’d be happy to answer any questions. So I’d like to ask the operator to open the line.

Thank you. We’ll now begin the question-and-answer session. (Operator Instructions). Our first question comes from Bill Katz from Citigroup. Please go ahead.

Ken a question for you, perhaps just sort of curious what’s driving the increase in the comp into the second half of this year? And then, what’s the outlook as you roll into the New Year?

I would characterize it as planned spending, a little bit of headcount. There is a couple of things on the horizon that might be -- I wouldn’t say are a trend, more of one-offs that may occur. So I was just kind of giving you a heads up on that, but in terms of the general business, there is just a couple of planned initiatives that I thought might -- or we think might increase headcount going forward slightly, as I mentioned.

So would you expect to build off of that as you roll into the new fiscal year?

No I don’t think so. I think after kind of an initial increase in the next two quarters, it should level out.

And my followup question is just on the Global Bond outflows this quarter, could you perhaps give us a sense of what happened as the quarter progressed and where you’ve seen the deepest rate of attrition? I guess the second part of the question is, do you need to crank up the ad spend to get the gross sales to accelerate?

I wish it was that easy regarding the ad spend. I think, if you look at the progression and redemptions and clearly that area has been under pressure. I think, first of all, just looking where the majority of the assets came in in Europe and a lot of money as a safe harbor was going into Global Bonds, and then when you had European equities take off, you had a reallocation. So I think that’s more of a shorter term trend in pressure where people are now investing in European equities, especially European, so that puts a near-term pressure. I think for the quarter, the heightened redemptions were around the Ukraine situation and having some exposure, we don’t think very much, I mean certainly 3%, 4% is a well-diversified risk for the fund, but I think if at any time you have that kind of headline risk in a fund, that can lead to some redemptions as well. So, the redemptions were clearly higher earlier in the quarter, and we feel like as we’re progressing in a newer quarter that that trend is certainly improving. And I’ll just also add that if you look at the U.S versus the SICAV fund, it really has been concentrated around the SICAV fund where you have more concentration with gatekeepers and probably heavier portfolio allocations to individual investors that own them for a very different set of reasons with the question of the euro at the time and problems overall in Europe.

Our next question comes from Michael Kim from Sandler O'Neill. Please go ahead.

Hey guys, good afternoon. First, just a follow-up on the Global Bond Fund, just given sort of the volatility across the FX markets and the impact that’s had on sort of the returns for the Global Bond Fund, I know that longer-term track records remain strong, but do you feel like the recent performance pressures maybe make it a bit harder to differentiate that fund in this type of environment?

Well, I think any time you have equity markets as strong as they have been, that’s going to put pressure on this type of fund. But again, how sustainable is that going forward. I think that’s the question. And with regard to shorter-term performance, this fund is positioned for rising rates, and if you look at the year-to-date, anybody with longer duration, which is our peer group in the global bond area, had the benefit of rates declining, so that's put some near-term pressure, but the performance looks really fine from a standpoint of currencies and its allocation, so we feel good about it and we’re always going to have under or over in the short-term, but the underperformance is very small and most of that's due to, as I said, the duration of the fund.

Got it. And then second question, just seems like one of the themes that maybe emerging across kind of the institutional equities landscape is just rising demand for more concentrated equity strategy. So, just wondering if to what extent you might be seeing signs of that trend, and then which of your strategies might be in a position to capitalize on sort of institutions looking for higher-asset type products?

Well, I think that’s been characteristic of a lot of our different funds that have concentration, and certainly you can look at an example, our Asia growth fund and our U.K. (inaudible) fund, which are concentrated -- more concentrated portfolios, so we think that trend as an active manager that making bigger bets does ultimately make sense, it’s going to create more volatility versus the index on the shorter run, but again for institutions that understand that and have a longer-term perspective, I think that that trend should continue.

Our next question comes from Chris Harris from Wells Fargo. Please go ahead.

Thanks. Good afternoon guys. Greg, just want to follow-up on that first question that you answered regarding the global bond redemptions. Is it possible to kind of quantify how much of those redemptions were coming from, kind of, European investors moving up the risk curve a bit versus how much is coming from kind of issues surrounding Ukraine and maybe China slowing down?

No. I mean it’s really difficult, I think we just do our best job, but I think if you look at the global bond fund in the U.S. it didn’t experience anywhere near the redemptions of the fund that primarily has been distributed to Europeans. So, a very different set of reasons and issues I think on each side, but clearly the global bond and total return represented about $8 billion of outflows from our SICAV fund, and the U.S. fund had just about $0.5 billion in total outflows, and that’s a similar sized fund. So you can see just how different the reasons are, and in the same set of issues, I think if performance was an issue or Ukraine was an issue, I think it would hit both. I really think it’s more about you had a heavier allocation for a different set of reasons for the average investor and now they are much more comfortable with more of a risk on view of Europe than they had before.

Okay. Yes, that’s an interesting point. Okay. Follow-up question then on the U.S. equity side of the business, I mean obviously a great quarter for you guys, I am really surprised that how strong it really was and so just wondering, whether this quarter had any kind of one-offs that might affect the growth I mean I assume seasonality had some impact. And then more broadly based on the trends you guys are seeing in that part of your franchise, do you think this rate of growth is sustainable?

Well, I think it really was the highlight of the quarter. I mean when you look at gross sales at 8.2 billion on U.S. equities, that’s been a big push for the firm to build awareness and distribution on the U.S. equity side. There really were no one-offs as far as large institutional mandates that were funded during the quarter, so most of that was through the traditional mutual funds. I think the $2.6 billion in net flows, overall gross up 35%, I think the only concern would be that one of our best sellers was biotech which has been somewhat under pressure more recently, but everything else, you parade down the line U.S. opportunities fund, rising dividend fund, all have been strong drivers of growth, and I think that will continue.

Our next question comes from Ken Worthington from JPMorgan. Please go ahead.

Okay. This is sort of a follow-up on the last question. So in domestic equities, can you flush out more, so you mentioned biotech in terms of -- in rising dividends, but the -- as we look at kind of the publicly available data, the strength seemed to be bigger than we would have been able to maybe figure that on our own. So was there something beyond just the funds or maybe it’s coming out of the SICAV products as well, so any more color you could share in terms of products and distribution would help me? Thank you.

The only thing I can think of that exchanges somehow could come into that number, maybe more difficult to model, but I’m not really sure why that you would have trouble figuring that out. It’s really the SICAV that's been the bigger driver with U.S. growth and biotech in terms of flows versus the U.S. funds.

Got it, okay. Thank you. And then in terms of K2, what should we be expecting here for the next quarter or two in terms of performance fees, if you could help us with the outlook there, it would be great. Thanks.

I think if you remember back last quarter, we had -- I think it was somewhere in the 20s of performance fees. So, in an order of magnitude in the June quarter, I think you’re talking about, as of now 20% of that number maybe or a quarter of that number.

Our next question comes from Robert Lee from KBW. Please go ahead.

Maybe just going through the balance sheet and capital a little bit, in the past, you guys have taken on some debt here or there which partially funded some special dividends and share repurchases, and clearly it would seem that you have more capacity to do that, so could you maybe just comment a little bit on maybe what are some of the -- in order for you guys to be comfortable doing that if that’s a possibility, what are kind of some of the metrics there that you take into consideration? Are there specific leverage ratios or credit ratings that you’re focused on that kind of put a governor on your willingness to maybe put a little more debt on to return a little bit more capital?

Yes, so I think we got a similar question on this last quarter as well. There is no reluctance to take on debt I would say. We don’t have any plans to do so either, but I think we continue our practice in the past kind of look at the overall debt ratio, look at the maturities of debt coming up, look at the interest environment and forecast and just be opportunistic like we’ve been in the past. I think that also out of current cash flow generation, we have the ability to be flexible on the capital management side. The Board does look at the payout ratio that we’ve been putting, putting on earnings report, so that’s why we put it there, and also the total share of the return of the stock will be the two overwriting metrics.

Okay, and Greg, I'm just curious you talked, mentioned in Europe saying better demand in the marketplace for equity strategies and that's coming somewhat at the expenses of maybe Global Bond, but can you maybe talk a little bit about how you feel about your positioning in Europe from an equities perspective? I mean, clearly you’ve built the big SICAV fixed income products but given that you still have some modest outflows from global equity strategies, did you feel like you’re getting your fair share over that movement in Europe from fixed to equities? Is that -- kind of what’s the strategy there to pick off more of that flow?

I would argue that if you look at the world Europe we -- it's probably our best market for equities overall where if you look at the European growth fund, the mutual European fund, these are all top selling funds and it’s really due to European distribution. So, as a percentage, it’s heavier, the drag in Europe's been over the last quarter or two has been the Asian growth which again is not U.S. equity but in our overall equity number and that’s been the third highest level of outflows for any fund. But the good news is that the performance is doing better there short-term and we had some pension redemptions in Latin America that we will then fund, but we think that's subsided as well. So, overall Europe probably the strongest shelf space and distribution position for us for equities in any other region.

Rob, if I can just chime in to, I know, you’ve asked about equities but just made me remember -- we’ve been experienced a pretty positive trend on the Franklin income fund in the SICAV products too over the last year. So either that might be kind of an indicator or investors taking on more risk, and then as Greg mentioned, we have some strong equity showing as well.

Our next question comes from Craig Siegenthaler from Crédit Suisse. Please go ahead.

Can you update us on how much cash that’s outside of the U.S. right now and also your estimate of how much free cash flow you’re getting from your businesses outside of U.S?

The cash flow generated, it's about 50% range that’s the generation part I think, it’s in our filing but I feel like the numbers are 60% non-U.S.

Okay. So 60% of current amount.

Right. And so when you’re looking at net income, it's probably a descent proxy for cash flow and we’re generating about 50-50.

Got it. And given no plans for a tax repatriation holiday in Verizon, what is your plan to do with the cash that sits outside of the U.S. right now and also the future free cash that you’re generating over the next few years here?

I think the cash is there to reinvest in the offshore business and that we’re going to continue our practice there. And as you know, all of the capital management activity as well as the income tax and all that are come out of the corporate holding company, the U.S. holding company. But there is a lot of cash being generated there as I mentioned, 50% of the income which keeps growing. So, I think we have a lot of flexibility to do both fund our international growth as well as our capital policy requirements.

And Ken one more question, do you have the CapEx number for just reinvestment in international businesses on let’s say the last 12 months?

Yes, I don’t have that number, but we’ve made small acquisitions and we’ll continue to do that, I’m getting a little feedback on the mic, but I don’t have that number Andy.

And next question comes from Dan Fannon from Jefferies. Please go ahead.

Good afternoon. I guess Ken just following up on your comments about the salaries and benefits and where you’re hiring or hiring, can you talk about the regions or the areas which that hiring will take place? And then any other color on any of the other expense line items for the rest of the remainder of the year?

Yes, I think in general the kind of the planned expenditures relates to portfolio and also some distribution expanding our global footprint through distribution, that’d be the focus of it. The business grows, we continue to support it but number that from a back office perspective, we have those low cost jurisdictions, so it doesn’t impact the comp line that much. And in general I think the only other area that we’re seeing increased spending is on the technology side, so I don’t think it will be a lot, but may be in another 1%.

Okay. And then just in terms of the redemption trends, Greg you mentioned in hybrid there were some one-off outflows and then obviously international being the area where redemptions picked up. Can you talk about specific regions outside the U.S. that might have been more elevated than others?

Within hybrid?

Hybrid specifically about those outflows and then just generally for the rest of the buckets and international?

Yes, I mean, the hybrid, the couple of factors that I think affected the quarterly flows. One, we had two or actually two separate accounts but all related to one client that with K2 that was close to a $1 billion that we previously announced and that affected the quarter and hit the hybrid number, so that was a one-time lower fee $1 billion effect. The other was a large -- one of our large distributors in their model and they had a very significant exposure to Franklin Income Fund reduced that exposure and that affected, it hit some exchange as well and the balance fund but just because of the high yield exposure they reallocated that and that resulted into what we think is again a one-time quarterly pressure because the underlying strength for hybrid in the Income Fund continues to be very good and actually this quarter with rates declining year to date that that fund did better and is back to being top in every period, so it has continued momentum. As I mentioned, the only trend around redemptions I think of note I mean Asia Pacific was actually did very well. For the quarter it was really Europe and focused on the three funds, it was the global bond total return in Asian growth and everything else would have been a great story specially on the equity side, but those three have been under pressure, they are under pressure in Europe and that’s where most of those assets were raised. So, that’s really the only one to highlight.

The next question comes from Michael Carrier from Bank of America Merrill Lynch. Please go ahead.

Thanks guys. Ken, maybe just a couple of number things, so I hear you on comp in terms of the outlook, I guess just when we think about the current environment whether it’s on the flows or the market backdrop, I guess when you factor in the outlook on headcount versus that just is there any change or you just saying the 1% based on hiring needs, but then obviously there is variability in the operating environment?

Yes, I think there is variability in the timing, so that’s why the time's a little squishy there. But generally we think we’re -- when we talked a few quarters ago we talked about keeping expenses kind of in the low single digits range and I think we’re sticking with that, it’s just that there’s a lot of planned expenditures and if the business environment supports it, we know we’ll go through with those plans but it’s something that we have ultimate flexibility on.

Okay got it, and then two other items which I know they’re always hard to predict and they move around, but just wanted to get your sense on the non-controlling interest just seemed like it was you know more of a positive into this quarter and then the tax rate was on the opposite side and you had a little bit of a headwind, so anything in terms of the outlook, you know on either of those items, obviously they move around a lot but any color.

Yes the non-controlling interest and all of the activity in non-operating income related to sponsored investment products and VIEs, I mean that’s really hard for us to predict, we try to give you some colors to where, all that’s related to our seed money basically in investment so we try to give you some color in our filings about what those, what categories those investments are in, but I sympathize with your task of trying to project that line item. In terms of the tax expense, we’re still feeling that we’re in a kind of 29.5 to 30% range.

Okay, all right thanks.

No, it’s a factor of mix too, but based on the current projections, that’s our position.

Our next question comes from Brennan Hawken from UBS please go ahead.

Thanks, good afternoon guys. First this question quickly, I think you highlighted in your three recorded comments, in the mini funds there was some relief in the outflows in March and was just curious if you saw that carrying through to April or if that was, if that period could just be a March phenomenon .

Well you know we don’t disclose flows, because -- and I think one of the reasons for that is we don’t disclose flows inter quarter because it’s pretty short term and things can change, but all of the -- let’s put it this way, all of the commentary that we’ve made you know we do see that continuing in terms of decreased redemptions in muni bonds and some of the other products that Greg was talking about.

And I would just add that I think it’s encouraging that the gross sales were up over 20%, quarter over quarter and certainly with Puerto Rico having a strong offering and strong demand, I mean that helped the market but overall, really the intermediate to shorter term is where you’re seeing strong inflows and that’s the same for us the Fed intermediates been the strong one. So I think any longer duration that you are still going to be under a little bit of pressure, but certainly a lot better than where they were a quarter ago.

Terrific, thanks for that color. And then another one on capital, you all mentioned and you highlighted a couple of times in answering Craig’s and Bob’s question that, and you mentioned prerecorded comments that 50% of earnings in the US, is there to support dividends and buybacks but you know is that a way to adjust and make us think about a 50% of earnings payout ratio as opposed to you know the 60 to 65% ratio that you guys targeted in the middle of last year.

No I don’t think that changes, I think using the word targeting is even a little bit strong but that’s been a part historical rate and I think we’re kind of, we’ve realized that and we realized that that’s where the expectations are and if we were going to change it, I think we would transmit that well in advance, so there’s really no change there, I don’t think you should imply that there would be a change from the 50-50 comment, but we’ll continue to be opportunistic and obviously it’s a function of a lot of things including the market but regarding the international, there was a question earlier on CapEx, but really I think one of the largest uses of our offshore cash is product development and seeding new products. We have a lot of offshore cash in new products that are sold around the world to generate a track record for that. So, in our mind it’s kind of R&D, international R&D that we’re using a lot of that balance sheet for.

Our next question comes from Douglas Sipkin from Susquehannah, please go ahead.

Yes, thank you good afternoon guys. I hate to beat a dead horse but I think it’s an important topic for you guys, particularly in light of what your comments on the last question. I guess I’m just trying to reconcile, you guys haven’t changed the target at all, the last two quarters it’s well below the target, I guess what am I missing, because either, and for at least from my vantage point, either you’re kind of cautious on the markets, that’s what I’m reading or maybe there’s a strategic opportunity that no one seems to be picking up, just looking at trailing payout ratios versus your guidance. So maybe you could shed a little bit more light on that I apologize if it’s repetitive, but it’s definitely I think a good topic for you guys, one that matters a lot.

On the previous targets trailing 12 months, so a while back we had a special dividend and that kind of rolled off, so that’s where you really see the decrease happen. The special dividend at that time was primarily tax driven, there was tax reasons to do that and that is a special dividend and there wasn’t a special dividend this year. So you see that the other factor is in the first quarter of this year, the markets were in a pretty good run and we just felt we kind of scaled back the share repurchase because of the overall macro-environment. But then pulled back in January and elsewhere you saw this quarter we stepped it up probably about a third over the previous quarter.

Got you. So I guess then just interpreting those comments, it feels like maybe the stock's out of place where you guys would be more aggressive?

Well I think it’s a function of, it’s a function of a lot of things including the overall market and so we’re in there on a regular basis assessing the market and what opportunities are available. So it’s kind of a day by day thing.

Our next question comes from Eric Berg from RBC Capital Markets. Please go ahead.

I think in response to earlier questions, you indicated that you’re global equity business had a number of pluses and minuses to it with the end number obviously being a minus 1.2 billion. Would you mind just going over a little bit more slowly than -- a little bit more slowly sort of where the strength was? I believe you indicated it was in Europe but if you go over the funds then enjoyed inflows versus those that enjoyed outflows leading to the net outflow?

The areas of strength within global equities would be our European growth fund which is managed by one of our local asset management team in Europe. Our mutual global discovery is another one that has done well in terms of net flows the Templeton side not -- I wouldn’t say dramatic changes one way or another as far as flows and more even on a net basis. The pressure was really as I said earlier the Asian growth fund which has had about 1.9 billion in outflows and that’s had a tremendous long-term performance but it is a more concentrated portfolio and obviously with pressure on emerging markets and some of the fed tapering issues, those currencies and things and some of those places got hit during the quarter and as I said earlier on the call we had some rebalancing or partial redemptions of some large institutional accounts from Latin America that we hope are kind of one-time hits and the recent performance has been very strong over the last three months. But that would be the summary in general on global equities.

So my second question is really a follow up to the first. As we look to the June quarter, obviously you can’t get into the details of what the flows look like but conceptually would you -- is it right to be thinking of an improvement, a significant improvement in these very substantial outflows from the global fixed income area and at the same time getting more help than you got in the quarter just reported from global equity business, directional is that?

Yes, I mean I think it’s early and why we are so careful because you know how quickly a headline can come out or something can change that can affect the quarterly flows. So as I have indicated earlier, I think some of the headline risk that affected some of those other funds appears to have moved that type of money out and hopefully that that is slowing down and we’re seeing that and I hope that trend continues. But I think you’re right, if I indicated we think they are one time quarterly effects on things then that would mean in a normal environment it should be better.

Our next question comes from Marc Irizarry from Goldman Sachs. Please go ahead.

Greg can you give us an update on K2 and maybe some of the new initiatives on the product side around the alternative opportunity for you guys?

I think the first goal is to introduce a retail 40 Act fund and that took a lot of work to get that done as we’ve said on previous calls. I think as far as distribution we’re now on 45 platforms, so that was an undertaking as well. And I think we’re near 380, 350 somewhere in that range million in those funds. It really hasn’t the new platforms were kind of the key ones, the bigger broker dealers out there that specialize and have mandates to increase in alternative. So that I think that that side of it, the integration with people continues to go very well with the teams, so we’re still very optimistic. I don’t have any -- we’re also very careful about setting a forecast or what is our expectation, I think it’s to get the awareness out there and educate about the capabilities and then we see where that goes. But I think all of the trends around looking for alternative setting specific goals and this being one that people are pretty comfortable with or still pretty optimistic on the retail side.

And also following the launch of the U.S. version of that fund, the cross border SICAV versus our funds in the works probably be launched sometime in the fall.

Okay and then just on hybrid, you may have mentioned this Greg but the uptick in growth sales during the quarter, can you give a sense maybe where that’s coming, where those since some of the sources of strength there in terms of the uptick in hybrid and is that something also that you’re seeing as may be more sustainable on the environment that we are in?

I think there is a lot of factors, one the we’ve mentioned earlier that the SICAV version of our Franklin Income Fund is starting to get traction and we had about 300 million in net inflows going into that one, also just the strength of our flagship income fund has contributed. And then some of redemptions in other areas have gone into the hybrid funds whether it’s Global Bonds others that we’ve seen exchanges moving into more of the balanced funds and that affects the overall gross and hybrid. So we think that that’s a trend that will continue and especially the fear of rates rising and having different type of exposure to that will also contribute to more balanced hybrid funds.

Okay, then, I know, it’s tough to get too much color around this but just in terms of your seed portfolio on non-op gains, how should we think about what we saw this quarter maybe what the book looks like today and what the non-op, how should we think about non-op free cash?

I think the best thing and the thing that we can do too is just kind of look to see generally speaking, so a lot of that is our trading investments, so you look to see like what categories are trading investments? As we go through the quarter, if it’s global equity or if it’s fixed income markets, you can kind of get some feel for where that line will be, it gets a little more completed because as funds get successful, we'll deconsolidate the funds, so that’s a little hard to predict even for us, so there’s always going be a margin of error for that but at least in our filing, we show you where the money is invested. It hasn’t really changed that much in terms of composition by investment object over the last few quarters.

Our next question comes from Glenn Schorr from ISI. Please go ahead.

I guess this is a two part on performance, I’m flipping through the queue. I noticed a pretty material improvement in the one year performance in both hybrid and in fixed income, so much so that, I guess, question is, one, was there a roll-off of a tough period four quarters ago because improvement is significant; and two, given that significant improvement, does that change your near-term ability to cross sell or to sell through both hybrid and tax rate just on these better results because they are much better?

Well, I think that, I did mention earlier that Franklin Income Fund is a driver for us for hybrid flows to $90 billion fund in the U.S. and it was lagging I think last quarter, and the difference is rates have dropped that has more longer term duration in it’s typical categories, so what rates do we’re are going to drive that fund's performance specifically with exposure to groups like utility that has unperformed a quarter or two ago. So that will drive the shorter term number. It’s not really -- it was just a better recent numbers, not -- there was nothing unusual or dropping off of prior quarter. It was just if rates go down, that one tends to do better than its category because it does have a higher yield than other hybrid type funds in its category.

And I think last quarter was below the second quarter.

Just below, right, just below.

But tax free is a little bit different story?

Well tax free for us again, it’s really the function of duration because we position ours for lower volatility, higher tax free income. When rates drop, we tend to underperform in the short run but because we have lower fees, we tend to fine, in the longer term when we find that, that area if I have to wait, total return is less important than certainly equities, as far as how our market looks at them because our markets buying them more for stability and current income than they are trying to get an extra 20 or 30 basis points total return.

We have no further questions at this time.

Okay, well, thank you every one for participating on the call and we look forward to seeing many of you, May 22nd, New York. Thank you.

Thank you ladies and gentlemen. This concludes today’s conference. Thank you for participating. You may now disconnect.