Hello, and welcome to the 3D Systems Fourth Quarter and Full-Year 2023 Earnings Call and Webcast. [Operator Instructions] As a reminder, this conference is being recorded. It's now my pleasure to turn the call over to Mick McCloskey, Vice President, Investor Relations. Please go ahead, Mick.

Good morning and welcome to 3D Systems conference call to discuss the preliminary results of the fourth quarter and full year 2023. The financial results presented on today's call and included in our earnings release are unaudited. The company is in the process of completing its quarterly and year-end close process. Accordingly, actual results may differ from the anticipated results discussed today and shown in our earnings release. We're delaying the filing of our annual report on Form 10-K for the fiscal year ended December 31, 2023, and will file a Form 12b-25 notification of late filing with the SEC to extend the deadline to file the form 10-K. Our final audited financial results will be included in the Form 10-K once filed. With me on today's call are Dr. Jeffrey Graves, President and Chief Executive Officer, Jeff Creech, Executive Vice President and Chief Financial Officer, and Andrew Johnson, Executive Vice President, Chief Legal Officer, and Chief Corporate Development Officer. The webcast portion of this call contains a slide presentation that we will refer to during the call. Those following along on the phone who wish to access the slide portion of this presentation may do so on the Investor Relations section of our website. The following discussion and responses to your questions reflect management's views as of today only and will include forward-looking statements as described on this slide. Actual results may differ materially. Additional information about factors that could potentially impact our financial results is included in our latest press release and our filings with the SEC, including our most recent annual report on Form 10-K and quarterly reports on Form 10-Q. During this call, we will discuss certain non-GAAP financial measures. In our press release and slides accompanying this webcast, you will find additional disclosures regarding these non-GAAP measures, including reconciliations with comparable GAAP measures. Finally, unless otherwise stated, all comparisons in this call will be against our results for the comparable period of 2022. With that, I'll turn the call over to our CEO, Jeff Graves, for opening remarks.

Thanks, Mick, and good morning, everyone. I'll begin this morning with a brief reflection on 2023 performance. I'll then shift focus to 2024 and our path forward, discussing not only our restructuring initiative to take cost out of the business, but equally important, the areas that we are consciously choosing to continue to invest for future growth. Finally, I'll wrap things up with some comments on our 2024 outlook, before handing things off to our new CFO, Jeff Creech, for a deeper dive into the financials. As you may recall, Jeff joined the company in mid-December. He brings over 25 years of experience in finance leadership and business transformation, and has already hit the ground running as he led us through the year-end close. Welcome aboard, Jeff. It's great to have you with us. Before I begin discussing our recent results and forecast for the year, I think it's an important time to reflect on the state of the industry and where 3D Systems is positioned within it. I'm now on Slide 5. 3D printing's been around since our founder, Chuck Hull, invented the technology in the early ‘80s. It very quickly proved useful as a prototyping technology, a role it continues to play today. However, the real value of additive manufacturing, as it's now more commonly called, is when it began to be used to manufacture real components, not just prototype parts. This evolution took over 20 years and it required advancements in the printing hardware, the software for process control, and most importantly advancements in the materials that could be printed. Fast forward to today and we have the technology to manufacture an incredible range of products from orthopedic and dental implants for human beings, to key components for aerospace, automotive, and many other industrial markets. This evolution…

Jeff, thank you very much and I appreciate the warm welcome, and good morning to everyone on the call. While I've already met many of you on the conference circuit in January, I look forward to meeting more of our investor and analyst community in the very near future. I'll begin with Slide 17 with our revenue summary. For the full year 2023, we reported consolidated revenues of $488 million, down 9% from the prior year. Year-over-year results were primarily impacted by a headwind in our dental orthodontics business, further amplified by broader macro weakness pressuring most other markets, which was most accurately reflected in printer sales. From a segment perspective, revenues in industrial solutions mostly held firm at $275 million, with full year performance declining about 1%, despite a tougher economic backdrop. Within industrial, headwinds from the prior year in more price-conscious markets such as jewelry, were largely offset by continued momentum and growth in areas such as transportation and motor sports, semiconductors and aerospace and defense. Healthcare solutions delivered full-year revenues of $213 million, declining approximately 18% from the prior year. The full year's performance was most heavily influenced by the decline in our dental orthodontics business, down roughly 39% from 2022, while the remainder of our healthcare segment was essentially flat. Although embedded in this was full-year growth of 12% for our personalized healthcare business. Shifting to our fourth quarter performance on Slide 18, we reported consolidated revenues of $114.8 million, declining approximately 14% from the fourth quarter of 2022. While our materials and services performed well in the quarter, growing from prior year, it simply was not enough to offset weakness in printer sales, again, most significant in dental, but also felt more broadly across our remaining businesses. From a segment perspective, industrial solutions reported fourth…

Thank you. [Operator Instructions] our first question today is coming from Troy Jensen from Cantor Fitzgerald. Your line is now live.

Hey gentlemen, thanks for taking my question, and Jeff, welcome to the team. I guess first thing I want to ask is just dental all in, are you expecting this to grow here in 2024?

Yes, Troy, it's certainly in the process of bottoming. If you look at - we've got pretty good visibility to the ultimate customer in the end market. So, clearly, demand is rising. The complexity as 2023 ticked by was the clearing of inventory in the supply chain. So, there was a lot of work done last year to clear that inventory. So, I would tell you, it’s pretty much cleared. And so, we're - I would call Q1 here bottoming, and then we should see a lift going forward after that, primarily in materials and services for that business. I believe there's plenty of printing hardware capacity in that supply chain. It's more materials consumption rising out of rising demand. So, I think you'll see it kind of bottom out here. Whether it bottomed in Q4, is bottoming in Q1, is kind of hard to tell, but it's in the process clearly of turning.

Okay, perfect. And then sticking in dental here, I know you said you expect to get FDA approval for NextDent later this year. Is there also insurance qualifications you guys need too before it can really take off?

No, we're good to go. As soon as we get the 510(k) approval, we're good to go, Troy. In fact, we’re putting in printing capacity to handle printing that product now. So, we’re really bullish on that new product. It's a terrific looking and performing product. We've got to, as always, work our way through the FDA regulatory approvals, but we view that as very manageable, and we should have it in the market later in the year.

Okay, perfect. And last question and I'll cede the floor here. Can you remind us what you're spending quarterly on regenerative right now?

What we're spending quarterly on regenerative, it’s - and I'm not trying to hedge, Troy. It's a bit complicated because we spend a certain amount and we get some of that reimbursed from United Therapeutics. There's some things we do on our own, especially around pharma, but a lot of the organ work obviously is reimbursed. So, we spent about $10 million last year of our own money. If you take away all the noise, we spent about $10 million last year of our own money on regenerative medicine, okay, primarily to pursue the pharmaceutical market. And we continue to look at the range of applications. We could be chasing dozens of them. We're trying to be very disciplined about what we actually chase, and our highest priority with our own internal funding is the pharmaceutical pursuit, okay, because the payoff to making progress against the drug induction timelines is enormous. So, and the receptivity of the pharma companies has been really encouraging. So, we landed our second contract late last year, as I mentioned. We've got a really nice pipeline of interest coming forward, especially after the J.P. Morgan Healthcare Conference. So, things are looking very promising for the pharma pursuit. So, we're clearly giving priority to that right now. And then obviously the long work with United Therapeutics is an extremely high priority as well for the longer-term.

Yep. All right. Understood. Well, good luck going forward and a special shout out here to Andrew. Thanks for all the hard work over the years.

Yes, thanks for that as well. And thank you Troy for doing such a great job covering us. We really appreciate it.

Thank you. The next question is coming from Greg Palm from Craig-Hallum. Your line is now live.

Hey, morning, everybody. I guess just thinking of back to Q4, it sounds like the vast majority of the shortfall was more system-based CapEx-driven than anything. Do you have the growth rates and systems versus consumables for the quarter, and any sort of general sense on how that trended for the full year as well?

Yes, we'll see if we can dig up a number. I can tell you qualitatively, Greg, the equipment was really tough last year with CapEx spending being down. We were quite surprised in Q4 to not see the normal seasonal lift, especially because customer engagement and sales has been very high. And we have this advanced applications group in our sales organization, and they’re bursting at the seams with work to do for new customer applications. So, we were very surprised to not see that flow through as it usually does seasonally at the end of the year. But I think it just reflects customers’ nervousness about what the rising interest rates will do to end demand. No lack of interest, which is the encouraging thing. I think it's more of a timing issue. Problem in their 2024 guidance was it's very hard to say when does that nervousness subside? And so, we've modeled it as a pretty flat year this year, and I hope that's conservative. Do we come up with an actual number for Greg? We don't normally break that out, but I can tell you, Greg, just qualitatively, our shortfall in revenue was hardware driven, not materials and services. Materials usage was actually pretty darn strong all year long. It's just people weren't adding incremental capacity.

Yep, makes sense. And specific to the Q4 decline, I mean yes, it’s going back a long time and unable to really see that sort of sequential decline. Usually, you see sort of the opposite, but just the confidence level around that, it wasn't competitive loss. It wasn't share loss. It was more timing. Can you just maybe go in a little bit more detail on - yes.

We've got - it was a big question internally that I had, Greg, and I can tell you, we chased it to ground, and we've got line of sight to almost every printer hardware saw significance. And it was not lost market share. It was not a drop in customer interest. It was strictly a slow rolling purchase orders is what I would call it on their part is, look, can we - and it's not that they're short of cash. I mean, most of the people we sell to are fine from a cash perspective, balance sheet, very, very credit worthy big customers. It's more they weren't certain they needed the incremental capacity given where interest rates had gone. I think everybody just wanted to see the year turn over and how end demand affected their business. That’s as much as I can tell you, but I truly don't believe there was any share loss, and I think it was strictly slow rolling purchase orders on our customers’ part by and large.

Got it. Okay. And then last question, Jeff, did you - did you give a non-GAAP operating expense number from the quarter?

I did. Non-GAAP OpEx was about $66 million for the quarter.

Okay. That strikes me as being up quite a bit relative to the levels that you saw throughout the year, and obviously should have maybe taken into account a little bit of the restructuring that you announced in October. So, is that right? And I guess, what's - just to be clear, that restructuring you announced in October, can you just remind us just timeline and how much is OpEx versus gross margin?

Very logical question, Greg. It's a good one. So, there were four items in OpEx in Q4, which we did not take - we did not exclude to get to a non-GAAP number because they truly by definition weren't strictly one time, but I would tell you they were very short-term investments focused in Q4. Why don't you run through those, Jeff, real quickly?

Sure. So, again, what we saw in the fourth quarter were spikes higher than normal expenses in our external support fees. And again, this consists of audit fees and external consulting fees that we had to make a very intentional investment in to get us to the end of the year, and quite frankly to provide some added assistance in the CFO and internally at a CAO transition level. So, those were very intentional for us. We did make some accelerated investments in our IT infrastructure and really around, again, this concept of cybersecurity. We've had a lot of conversation internally about cybersecurity exposure, we know that it's a very scary world out there and we know that we, in a technology business, maintaining intellectual and proprietary information is extremely important to us. We need to be cognizant of what those threats are. So, we accelerated some of our investments in that area. We, of course, had the very distinct legal and advisory services associated with our debt repurchase, and those expenses hit in the fourth quarter. And again, as I mentioned, some increases in our regenerative medicine R&D. So, all four of those things were higher than normal. And with the exception of reg med, would be considered temporary in nature, and we would expect to see them go to more moderate and in some cases be eliminated altogether.

Yes, got it.

Okay, good, if that took care of it. And we're happy to follow up with you, Greg, on those details, but thanks for the question. That's a good one.

Thank you. Our next question is coming from Brian Drab from William Blair. Your line is now live.

Hi. Thank you. I just wanted to clarify one thing first. So, when you say the dental orthodontics was down 39%, is that a different number than dental overall, or is that - that's a number for dental?

It is a different number than dental overall, but it is the predominance of dental, if you look at it today, Brian. So, it was the big driver. The rest of dental did not suffer the same kind of impacts, because the rest of dental is much more reconstructive work that we do in the mouth, and that’s really not optional spending. It's back to orthodontic work that we're involved with. It's a big number and obviously it's discretionary. So, when inflation spikes, consumers just put off buying them, and I think you can see that. I'm very pleased with the commentary around, hey, people are buying more of them now. It's coming back, blah, blah, blah. But there was a lot of excess supply chain inventory to work down and we worked through that largely in 2023.

I'm just curious, I think that you've been giving the dental number in the past, right, the decline or increase in the dental business overall. I don't know if you have that potentially at your fingertips for - I'd just be curious what 2023 looked like for dental and for the fourth quarter for dental overall, just given that's something I think a lot of people have been tracking.

Yep. So, performance for dental overall in 2023,

32%.

Yes, it was down 32%. All of dental was down 32%. And then we gave you the orthodontics number was down, what did we say, 39. So, yes. So, the rest of it was up. And I'm glad you're watching the rest of it, Brian, because as dentistry now converts to 3D printing, and I was at this dental show last week, it's remarkable, as dentures and other reconstructive items in dental go, I think you'll see much of a broadening in that market away from orthodontics, just orthodontics. Orthodontics will grow, but the rest of it I think has enormous growth coming and we’re really excited about it. That's why our focus is very broad on dentistry right now.

And overall, dental is probably down less than 32% in the fourth quarter, I imagine, right? Is that the decline moderating?

Yes. Correct.

Okay. I'll follow up more on that later. One other question I wanted to ask at the moment though is that I noticed inventories and accounts receivables remained somewhat elevated going into the end of the year. I mean, I guess the main driver of that is discrepancy between your expectation and actual sales. But could you comment on that? And then also I'm just curious if the elevated inventory potentially weighs on gross margin in the near term.

Yes, so, actually a simple answer on the inventory part of that, Brian, was, we completed our insourcing activity last year. We were really aggressive about insourcing our manufacturing that we started in 2022. We completed it in 2023. With that insourcing from contract manufacturers, you have to pick up the inventory they had on hand. So, that big spike in inventory from last year was the taking on of their inventory that we now have to burn down. The AP and AR balance, we generally were able to hold pricing in the marketplace. We did have to extend some credit terms to some folks, especially smaller customers. And we've been a good payer of suppliers, particularly since COVID to make sure we had adequate supplies. So, we're working on all elements of working capital. Clearly, there's a really nice ability to generate cash from that working capital this year, and we're working that aggressively. So, we're done with the inventory purchases from contract manufacturers. We'll be burning it down now.

And just the last question on that topic is, you said EBITDA breakeven is a target for the year. Is it logical to make the conclusion that you'd also expect to be cash flow breakeven in 2024?

We'll generate - we'll be positive in operating cash flow. And the free cash question is just how much we end up spending on CapEx. We have our normal CapEx required for maintenance, and there's some factory improvements with the insourcing we have to do. There's a couple of extraordinary growth areas that we have to put capital in in 2024 to grow in 2025. They're not huge numbers, but it will put pressure on CapEx. So, you'll probably - you'll see positive operating cash flow this year. You'll see a slightly negative - my guess is a slightly negative free cash flow as we invest CapEx, and we'll update you on that throughout the year.

Yep. Okay. Thank you very much.

Thank you. The next question is coming from Jacob Stephan from Lake Street. Your line is now live.

Yes. Good morning, guys. Thanks for taking my question. I just want to focus on the industrial side of the business. We've seen more investments in kind of the aerospace market. So, what kind of investments are you making there, if any?

So, in terms of investments, I would tell you, the primary investment there, you'd say, really is in our cost of sales, and it's our application engineers. What we see from aerospace right now is they really like - they really do embrace polymer processing a lot, but a lot of their interest is in metal processing and the use of proven, but new materials with additive. So, I'd say they’re not as far along as developing a lot of new materials, brand new chemistries for additive as the polymer site is, but they’re deeply in, in the process of evaluating existing materials on 3D printers. So, we spend a, a lot of investment money on our application engineers, working with customers on specific applications. And it’s very interesting, the driver of that. There's two camps. One of them is improved performance. They want to design a part that can't be machined, at least not easily. So, there's the performance-driven designers, and then we're seeing an increase in those that are motivated by risk reduction for their existing infrastructure. So, like oil and gas, we have a lot of interest in oil and gas because oftentimes those oil rigs or refineries are in very difficult parts of the world. And so, the customers are forced to hold huge amounts of inventory to make sure they stay up and running. They're really interested in localized manufacturing that could do just-in-time production of spare parts. So, we’re pursuing a lot of that for the electrical infrastructure, for oil and gas. So, if you look at investments, that doesn't require us to build new plants and things. There's not a lot of investment except in sales for application development for those folks. So, if you see an increased spending, it's around sales cost for those new industrial markets. Does that make sense?

Yes, yes. That's helpful. And then you noticed that you were - or sorry, you had said that your in-source initiative has been completed in 2023, but maybe just kind of give us an overall progress update on the restructuring initiative. Do you still expect the majority to be completed by Q1?

Yes, I'd say I would say mid-year more than Q1, but - so there's different - there's three legs of the stool of our restructuring. There's straight headcount reductions, and of course you’ve got to look at north America versus Europe in terms of timing there. All of the North American actions virtually were completed. The European stuff is in progress. You've got - for us, you've got site closures. We're closing 20 of 50 sites, and these are acquisitions that were done years ago largely that had remaining small groups of people that we’re now able to get efficiencies by closing those and consolidating the hubs, if you will, for design and manufacturing. You've got a lot of that work going on this year. And the tricky part of that is, when do the accounting regulations allow you to recognize the savings? So, we're driving to specific dates this year on these site closures, which are all underway. All 20 of the 50 are underway. It's a matter of when do they - when are they completed from an accounting standpoint, and what credit can you take in the year? That's why there's a range on our restructuring savings, frankly, because those accounting rules are really complicated. So, we're just driving to get them closed, get them done, get it finished and consolidated. And then, of course, we have the efficiency gains from insourcing. So, driving operational efficiencies all the way through the supply chain now that it's insourced. We recognized a little bit of that in Q4 and last year, but there's a lot more to come this year as we go forward. So, those hit both the OpEx line and - the restructuring hits both OpEx line and the COGS line, especially in manufacturing. So, that’s why we see a lift this year in our gross margin in 2024. And we'll get obviously a big swing in EBITDA by bringing OpEx down. So, that - qualitatively that's - it's in those three buckets and that's why you'll see the lift in both gross and EBITDA margins, even in a flat sales environment.

Okay. Thank you. I'll turn it over.

Thank you. Next question is coming from Ananda Baruah from Loop Capital Markets. Your line is now live.

Yes. Thanks, guys. Good morning and thanks for taking the questions. And yes, Andy, also, really have enjoyed working with you over the years. So, best luck on everything. Jeff, could you - I guess, maybe sort of put a little context around the remarks you made about the China competition when you started the call, what are you seeing in there and what's the right way we should be?

Yes, Ananda, the industry - it's very interesting. The industry's really changing. We've got our traditional competitors in the industry and they’re smaller companies. And then obviously some bigger companies, and some of them, the bigger ones are owned by very large industrial companies. So, you've got that historic competitive base. But increasingly, we see the emergence of Chinese players. And it's very interesting because you can buy a lot of the key components on the market. And what we see them coming into the market primarily is on the hardware side, not as much on materials and certainly not as much on software, but in terms of just raw hardware design and sales, they’re moving into the markets. They're moving into Europe. They're moving into the States. It's definitely happening. And they're just like - and not to generalize too much, but they're competing on price with hardware. The way - strategically, the way we compete with that is on not only the hardware technology, but bringing it together with materials and software and servicing the customer well, because they often struggle with that. So, broad-based, we're seeing a lot more entrants from China on the hardware side. And it does make it a challenge when you strictly look at the hardware itself. So, part of the pressure on R&D spend is to make sure that technologically we stay ahead in our core markets, that we stay ahead. I'm not talking about regenerative medicine. Clearly, we're ahead on that, but it's our core industrial and even healthcare markets, make sure we stay ahead on hardware, software, and materials, and then make sure we have the scale enough to service customers from a sales and service standpoint. So, while I will comment that we have sufficient scale to do it, we spend a lot of money servicing customers, and that's where when you talk about consolidation in the industry, scale helps. It really helps you more economically spread the costs. So, that's the full landscape around China. I'm glad you asked the question.

Yes, and so just a quick follow-up there. They've sort of like, they've been present in the way that you've described it in the past, call it at the consumer slash workshop level with the same kind of approach. Is it now you're seeing it kind of move up into - sort of into the bread and butter market? And I guess one more question to ask, kind of a distinction, is it both prototyping and production? And I guess, just sort of where - like context around that question would be great. Thanks.

Yes, sure. No, all good questions. So, clearly, it's more industrial and healthcare, and I'm very glad we have a healthcare business because with all the regulatory environment and the quality concerns and everything else, healthcare is the most difficult market for them to penetrate, as is aerospace and defense. So, I think those are probably the last markets at a production level that would be exposed to that. Again, talking about production applications, they're going to work in their way, and again, I'm sorry for the broad-brush commentary, but working their way into the other industrial markets, particularly industries that produce consumer products where quality is important, but it's not a differentiator, things like that. They're working their way into those kind of consumer-driven markets, which again, we have lighter exposure on broadly, but it's still important because that trend will continue, and it's one we have to set ourselves up for. Initial prototyping, clearly easier market, lower risk for them to get into, but it is definitely - they're definitely working on the industrial markets now, beginning with the easier ones, and working their way up to the harder ones. So, hopefully it answers both parts of your question.

Yes, absolutely. Appreciate the context. I'll just put an eye on time here. I'll see leave it there and just get you guys on the call. Thanks a lot.

Okay. Well, we look forward to talking to you, Ananda, as always. Thanks.

Thank you. Next question is coming from James Ricchiuti from Needham & Company. Your line is now live.

Hi. Good morning. Most of my questions have been asked, but just wanted to follow up to see if I can get a little bit more color on the decline in the industrial business, which the quarterly level looks like the lowest quarter of the year. And you talk about areas where the business has held up better, I think aerospace, defense, semi. But yes, what areas in particular were weak in the quarter and did that - was it more pronounced in any one geography?

No, it was - Jim, I'll try to answer all of those. It was pretty equal between the US and Europe. Most of our sales are in US and Europe. So, it was pretty equally split there, because frankly, central banks in both parts of the world have been raising interest rates. It was much more consumer market-driven, consumer end market-driven. So, if you look at all of our customers, industrial customers, big industrial companies, customers on the industrial side, some of them serve consumer markets. And I think the concern, Jim, that they all had was, with this rapid rise in interest rates, were consumers going to be able to buy as much and did they need the capacity? So, it's not like they canceled orders, but they just - again, I keep using the phrase, they slow rolled POs. So, you call them and say, where's the PO? Yes, next week, next week, next week, it's coming. So, they weren't canceled, and I believe they are all coming. I believe we'll continue to see a slow roll until they're convinced that the consumer isn't going to go away. And the closer you get to specialized equipment like semiconductor equipment manufacturer, very strong for us. We've been working in that market for a long time. So, people that are putting in semiconductor equipment, heavy industrial equipment, that business remains strong, no doubt about it. Defense and aerospace remain strong. It was, as you go closer to companies that make consumer products, those are the ones that were hesitant on the CapEx spend. And with all of that said, industrial hung in there better than healthcare last year. But again, healthcare was dominated by dental being off due to orthodontics. And then again, they had a lot of capacity in printers themselves. So, you saw some roll off in printers, even in healthcare. But industrial, we almost offset the decline by new customers coming in. So, while we didn't see an uptick, we didn't see as much of a decline on the industrial side either. So, if there's a ray of sunshine in there somewhere, it's probably that. My disappointment was Q4 is usually a very strong quarter and clearly it was not. We did not see the lift. We usually see people just hung onto their purchase orders.

Got it. And just last question from me is just on the non-GAAP OpEx to what you're guiding for in 2024, that would seem to suggest a pretty healthy step-down in Q1, but I don't know if that's going to be more backend loaded with some of the restructuring actions you're taking.

Yes, Jim, I would say it's probably a little bit more backend loaded. We took a lot of action quickly in North America when we launched this in terms of the headcount component. The tricky part is now the site closures, which again are split between US and Europe. The site closures take a little bit more time, and then the accounting resolution isn't done until you're out of the facility basically. So, we've got to be a little careful. So, you see a range of OpEx in our guidance. And again, I'd like to think we'll do better than that, but it’s - we try to be realistic about timing because I do think you'll see a big hit in the first half, which is good, but a lot of the benefits don't start flowing through until the second half.

Got it. Thank you.

Thank you. We’ve reached the end of our question-and-answer session. I'd like to turn the floor back over to Dr. Graves for any further closing comments.

Thanks, Kevin. Listen, thank you all very much. I know we went beyond time, but I wanted to field questions because I know it's a volatile time for our company and for the industry. So, thank you very much for hanging in there and asking the questions you did. I appreciate you joining. We are cautiously optimistic about 2024. We look forward to the year ahead. We'll look forward to updating you each quarter on progress. Thanks very much for calling.

Thank you. That does conclude today's teleconference and webcast. You may disconnect your line at this time and have a wonderful day. We thank you for your participation today.