Good afternoon and thank you for standing by. Welcome to the Deckers Brands Third Quarter Fiscal 2019 Earnings Conference Call. At this time, all participants are in a listen-only mode. Following the presentation, we will conduct a question-and-answer session. Instructions will be provided at that time for you to queue up for questions. [Operator Instructions] I would like to remind everyone that this conference call is being recorded. And I now like to turn the call over to Erinn Kohler, Senior Director Investor Relations and Corporate Planning. Please go ahead.

Thank you, everyone for joining us today. On the call is Dave Powers, President and Chief Executive Officer; and Steve Fasching, Chief Financial Officer. Before we begin, I would like to remind everyone of the company's Safe Harbor policy. Please note that certain statements made on this call are forward-looking statements within the meaning of the Federal Securities Laws, which are subject to considerable risks and uncertainties. These forward-looking statements are intended to qualify for the Safe Harbor from liability established by the Private Securities Litigation Reform Act of 1995. All statements made on this call today other than statements of historical facts are forward-looking statements and include statements regarding our anticipated financial performance including, but not limited to our projected revenue, margins, expenses, earnings per share, cost savings and operating profit improvement as well as statements regarding our strategies for our products and brands. Forward-looking statements made on this call represent management's current expectations and are based on information available at the time of such statements are made. Forward-looking statements involve numerous known and unknown risks, uncertainties and other factors that may cause our actual results to differ materially from any results predicted, assumed or implied by the forward-looking statements. The company has explained some of these risks and uncertainties in its SEC filings, including in the Risk Factors section of its Annual Report on Form 10-K and Quarterly Report on Form 10-Q. Except as required by law or the listing rules of the New York Stock Exchange the company expressly disclaims any intent or obligation to update any forward-looking statements. With that I'll now turn it over to Dave.

Thanks, Erinn and good afternoon, everyone. Today we are excited to share the results of our fiscal third quarter. Our performance was well ahead of the guidance we provided last quarter and demonstrates the progress we continue to make on the strategies we laid out two years ago. We delivered sales of $874 million compared to guidance of $805 million to $825 million and non-GAAP earnings per share was $6.59 versus guidance of $5.10 to $5.25. For the past few quarters, we've been talking about the improvements we're making across the business including bringing compelling product to market, implementing thoughtful and controlled distribution strategy, elevating and segmenting product offerings, growing our non-UGG brand and improving gross margins and operating margins. These exceptional results underscore how well our teams have executed on each of these front. Importantly, the results go beyond just over UGG brand. While the third quarter has traditionally been viewed as an UGG quarter, we achieved impressive growth with our HOKA ONE, ONE and Koolaburra brand. These two brands significantly contributed to the growth of our business and further emphasize the progress the entire Deckers' organization continues to make towards organically growing our brand portfolio. I'm incredibly proud of these accomplishments and very pleased to share our results. Now let's get into some of the details for the quarter. Starting with results produced by the Fashion & Lifestyle group, UGG sales were $761 million in the third quarter, up 3.6% to last year and driving the majority of our upside to guidance. We communicated a strong global marketing campaign for the brand's 40th anniversary alongside a very compelling product line. Overall placing the core product in U.S. wholesale accounts was well received by consumers. And our strategic approach to product allocation and segmentation created high full price sell-through…

Thanks, Dave, and good afternoon, everyone. As you’ve heard our results for the quarter are exceptional, and now I'll take you through them in greater detail and provide an updated outlook for the fourth quarter and our full year fiscal 2019. Please note throughout this discussion where I refer to non-GAAP financial measures, I'm referring to results before taking into account restructuring charges and other amounts that our management believes are not core to our ongoing operating result. Also note our non-GAAP results are not adjusted for constant currency. A reconciliation between our reported GAAP results and the non-GAAP results can be found in our earnings release that is posted on our website under the investors tab. Now to our results for the third quarter. As Dave mentioned, we achieved sales and profitability that was well ahead of our prior guidance, reaching a record third quarter result of $874 million in revenue and $6.59 in non-GAAP earnings per share for the period. Revenue was above our prior high guidance by $49 million, contributing to the revenue view we saw success in our key areas of focus, including non-core classic styles within UGG as well as strengthen our HOKA and Koolaburra brand. Specifically, the incremental revenue volume above guidance was primarily driven by approximately $18 million in UGG domestic wholesale with higher than expected sales in UGG men's and women's non-core styles including women shoes. $15 million from less promotional activity for the UGG brand driving increased full price selling seen in the top line results as well as improved gross margin. $8 million from HOKA as the brand continued to see rapid expansion of market share in the run specialty channel. $2 million from Koolaburra as in-season reorders were strong as well as some early European wholesale and distributor shipments…

Thanks, Steve. I think it is important to acknowledge that this quarter marks a significant point and our progression against our long-term target. As we have raised our guidance for the full fiscal year 2019 to include achieving up to $2 billion in revenue with operating margin significantly exceeding the target of 13% as well as fulfilling the commitment to deliver $100 million of operating profit improvement. And we are now on pace to deliver a year ahead of plan. In summary our success for the third quarter was highlighted by a strong product offering rich with brand DNA and relevant to younger consumer base to a new and existing wholesale account, thoughtful and controlled distribution through over UGG core classic allocation and segmentation strategy in the U.S. wholesale marketplace and favorable weather conditions for which we remained appropriately positioned to capture increased in-season – all leading to accelerated revenue growth in UGG non-core styles as well as impressive results in our HOKA and Koolaburra brand much less promotional activity than prior years, driving significant gross margin profitability above expectation and exiting the season with very low inventory in the wholesale channel as well as reduced owned inventory versus prior year. In closing, I would like to congratulate the entire Deckers' organization for executing an incredibly strong third quarter and for their commitment our brand and as we step into the next stage of our evolution. Thank you to all of our stakeholders for their continued support and to employees for their focus and passion for the business. I'm very excited about our results but even more excited for what lies ahead. With that we are now ready for Q&A.

[Operator Instructions] And our first questioner today will be Camilo Lyon with Canaccord. Please go ahead.

Hi. Thanks for taking the question and congrats on a -- the fantastic quarter. Dave, I wanted to get your thoughts on how the conversations have unfolded with your wholesale partners with respect to the resolution [ph] of the assortment and how you started the season with more of the fashion-based products and how they responded and they became the leaders and how you're now trying to reposition the classic business and how that should influence in go forward period?

Yeah. Great question. We've been working for quite some time to get our wholesale partners to adopt more of the line beyond just the core classics. Because we believe there's real strength in that assortment, especially now that we’re reaching a younger consumer, and it's just a much healthier sustainable business over time. So I'm super excited about how the allocation strategy worked in core classics. We contained the amount of inventory that was in the channel. We are very thoughtful on which accounts we gave core classics to and what quantities they had. And then we supplemented that with segmented approach of non-classic styling across shoes, slippers, boots, et cetera. And I think what you're seeing in this quarter is the results of that work playing out aided a little bit by some really cold weather to bring traffic and excitement to the brand. But the sell-through rates on core classics and in non-core classics inventory were exceptional. And so the accounts are very pleased with how we've been controlling the brand in the marketplace, how we've been positioning new accounts with segmented product offerings so everybody has something different and unique. And I think that is strategy that played out extremely well for us in Q3, and one that we're looking to employ in the international markets starting in fall 2019. So I guess to answer your question. The feedback from the accounts has been very positive. They all had a good season. As you saw, we had high full price sell-through. We didn't have to discount to drive sales even, though we were in December up against tough comp last year and exited the quarter extremely strong.

That's great. So would it be fair to say that clearly the weather was a benefit to the business, and benefit to all outerwear businesses this holiday season. But if it weren't for this fair time of weather pattern that was assuming with such that it would still would have been an advantages even bigger than that really the learnings and the takeaway from this strategic shift that we should embrace?

Yeah. I think I could say the weather early on was a catalyst to kind of spur the excitement in UGG and in the product there. But it wasn’t for the compelling product across the board that we've been working on for quite some time and this is really the first year you’re seeing the full assortment and the segmented approach hit the market with some new distribution. We wouldn't have done as well as we did. And I think if you look at the high-level, like we said on the call in the script, this wasn't just an UGG story this quarter. HOKA did tremendously well. Their best quarter ever, which traditionally Q3 isn't their largest quarter of the year. And I think you're starting to see the impact of HOKA and also Koolaburra and the portfolio approach to this business have a bigger impact, and we all feel great about the fact that we are less reliant on core classics and weather dependent in Q3.

Great. And then just be going to my last question. The last conference call you alluded to getting close to committing to a mid-single-digit sort of long-term revenue growth target. Could you just help us explain what that, the components of that would be clearly to focus on this tremendous growth path. You mentioned future investment, the continued investment in HOKA in the women streamline and men. Maybe you could just contextualize how we should think about those components of the business in context to the core classic business and how we should think about the different growth rates for you to achieve that in the single digits should growth rate.

Yeah. I mean we're not giving obviously long-term guidance at this point, but I still and firmly believe that mid-single digits is achievable in the long-term over the next three to five years. We do have significant growth drivers that we've talked about. First and foremost, we're going to maintain the strength of the core classics business. We don't see that as a major growth driver, but more than just a healthy annual business so we can continue to build on. But UGG men will continue to be a growth driver. New categories outside of core classics in women's and also in spring and summer. HOKA will be significant. And as we said before we see that brand getting to $300 million to $500 million in the next three to five years. I think when you add up all those components you get to mid-single digit growth level that we think is sustainable over the next three to five years.

Fantastic. Great job on quarter again. Good luck for the year.

Thanks, Camilo.

And our next questioner today will be Jonathan Komp with Baird. Please go ahead.

Yeah. Thank you. I wanted to start just following up on UGG and some of the upside. And David, if you could maybe talk a little bit more or give more detail on the shape of the quarter. You alluded to it a little bit but to some more color on how things played out? And then also coming into this year and the start we've had. How things have trended and what that means for current inventory availability and kind of early order trend if you would?

Yes, I think, I covered a lot of it. I think -- one thing is important to note is again we started out strong in October and November. If you remember last year, we had extremely strong December and we plan that business conservatively going into this quarter this year. Fortunately, we started out the gates very strong with some of the new products that were hitting the marketplace as well as some cold weather early in October which proved to be more of a catalyst to getting the business jumpstarted. But again I think it was the strength of the men's offering across the board driven by the new [indiscernible] styles and some of the fashion boots. The Adirondack style in women's was a top seller for us again even though we raised the price. That we still saw double-digit growth in that style alone versus last year. Shoes and sneakers in women's led by the Neutra sneaker and slippers led by the Fluff Yeah franchise. Those are normally not big drivers in the business, but we saw those really kicking in October-November through existing a new wholesale distribution as well as online that created excitement for the brand. And I think had a halo effect on the Classics but I think what the difference is this wasn’t a classics led business this year, I think it was across-the-board strength and we maintained, controlled the marketplace through pricing. So there was very little of any discounting going on. We entered the season very healthy and clean from an inventory perspective. We maintained that through strong full price sell-throughs and tightly manage reorders going into December. And even though December was a little bit challenging, we had enough momentum in the business to finish the quarter strong and made some decisions that actually we decided not to promote or drive closeout sales even though we could have in some cases. And we felt it's better to maintain a healthy positioning in the marketplace, strong full price selling for our consumers in our accounts and then exit the quarter with healthy inventory levels going into the first -- going into Q4 and next year selling. So we played out nicely. And again we've been working on this for a couple of years. As you know the segmentation, allocation and product assortment coupled with new brand positioning. And we're still feeling good about that positioning going forward. As far as Q4 goes -- the weather has been up and down, playing a little bit of -- have an impact in the business. In some cases, we still have some challenges internationally. Some of the ships of deliveries and accounting principles that went into Q3 make this quarter look a little bit lower than we anticipated originally. But still strong, sell-through is still, good handle on the inventory in the marketplace. We’re not doing a lot of closeout, and then being bolstered by the strength of HOKA.

Yeah. Jon, this is Steve. Just a kind of add on to what Dave said. I think in terms of how we looked at the quarter for the way it played out, it pretty much played out the way we thought. And then with less promotion we saw some lift in revenue and then we saw some timing impact. So the timing impacts that we picked up in Q3 is really what's impacting Q4. Q4 hasn't changed from the way we look today at it other than we shipped some products earlier in Q3. So exactly kind of what Dave said with an allocation strategy in place, we sold to that, we sold about that in additional categories that give us really the upside kind of in Q3, and Q4 will also take back from last year when you take into account the timing that went into Q3 still pretty much what we planned and then flowing through that early about $1.05 from Q3 for the full year is just in a reflection of how well our setup was for Q3 and the execution on our Q3.

Understood. And maybe just a follow-up on the call outs around the Asia Pacific business, I don't know if you can contextualize what you saw a little bit better there and any more commentary on what actions you might take to kind of address whatever it is you are seeing?

Yeah. I think our goal is to always control what we can control. And I think I always look at kind of our international markets in the last couple of years as probably year behind our strategies that we're executing first in North America. So the marketplace management tactics that we just saw play out in Q3 in North America, we'll be rolling those out to the international markets starting in fall 2019. With regards to Asia Pacific and the China business, there is a macro challenges in that marketplace with consumer sentiment. We had some of weather challenges in the marketplace, particularly in southern China. And those are the major factors outside of the brand itself.

Understood, thank you.

And today's next questioner will be Sam Poser with Susquehanna Financial Group. Please go ahead.

Thank you for taking my questions. I just wanted to go back into like, how would you weight it. Would you weight the success you had with UGG in the quarter as more weather-related or more of the segmentation brand control weighted?

Yeah, it's a great question, and there is no exact number or breakdown to that. But from where we stand, it's more weighted towards the marketplace management of the brand and the focus on brand positioning and product. So certainly, as you know Sam, managing inventory in the channel, the allocation of the Classics is a big component of that in creating demand in the consumer and for the account. And then bolstering that with an exciting product offering that is segmented by consumer and channel on account, I believe the majority of the upside is from that. And we're looking at it as aided by – the success aided by weather but not driven weather.

Yeah. And I think the other thing Sam too, talking just about the strategy how HOKA did, I think that further shows kind of how the strategy and the marketplace approach, not only with UGG but HOKA is working to.

I have two more. Can you give us some idea of the year-over-year DTC versus -- in the total wholesale EBIT -- what -- and I assume that they both were good but probably DTC -- it was a big beat on the wholesale line I would get?

Yes, it's a bigger beat on wholesale right. So we saw stronger wholesale outperformance than we did in DTC. You're right both did perform well. But also DTC was impacted by I think 11 stores closed this year versus last. So on a year-on-year we have headwinds with store closures related to retail. But again strong performance in DTC kind of stronger performance in wholesale so the perform -- it's the proportion of the wholesale beat is bigger than the DTC.

And the other piece to remember on that is in December last year DTC had an exceptional last couple of weeks in the quarter driven by cold weather that came late. We were unable to capitalize on that in wholesale but we were able to capitalize it on -- in DTC. We didn't have that same dynamic this year. And we've made the decision to not be as promotionally DTC this quarter.

And then lastly inventory levels. Could you give us the year-over-year percent increase or dollars how we want to do it for UGG and for HOKA just so we can understand sort of where this inventory is?

Yes, we don't normally break that out. But I can kind of directionally tell you. So total company was down 14% so ended the quarter at 342 that compared to 396 a year ago. The UGG inventory was down more than the company average. So UGG inventory down more than the 14%. And HOKA as we gear up for spring/summer and we have some new category introductions coming we brought inventory in earlier. That was actually up year-on-year.

Okay. Thank you so much. And continue success.

And our next questioner today will be Dana Telsey with Telsey Advisory Group. Please go ahead.

As you think about the less promotional environment how did pricing change -- did pricing change on any of the categories and what are you planning for pricing going forward? And did you get gross margin improvement from all brands?

So I'll handle the first one and Steve can handle the second one. We actually been working on pricing for quite some time and particularly in North America to make sure that we're competitive, I guess, the competition – there are competition out there and also by account with some of the new segmentation. So we feel that we actually had pricing set correctly. There are couple styles that we made decisions to change to be a little bit more competitive bringing those down, but we maintained healthy margins across the board regardless of category. We don't see any significant price changes go into next year. We're trying to do going into next year in FY 2020 is to add more value into some of the product that the prices we have more functional capabilities such as waterproof capabilities and some of the fashion boots in women. But pricing overall we felt we were set correctly. We were competitive. A lot of value in the pricing for the consumer and I think that played through in the full price sell-through.

And then just kind of on the amount Dana, you know, what we said in the prepared remarks with -- we think the less promotional activity contributed about $15 million. We think in the quarter that a little below kind of 200 basis points of improvement on the gross margin. As we kind of then extrapolate that out, that's not something we would necessarily plan kind of for next year. So when I talked about my one-time adjustment, we think for the year, it's probably worth of 100 to 150 basis points that we picked up, which is really combination of better full price sell-through as well as some of the airfreight benefits that we received last quarter that we're looking out forward giving guidance. But we think we benefited in the current year probably around 100 to 150 basis points that we wouldn't necessarily figure into next year. Doesn't mean it couldn't repeat, but we wouldn't figure it next year.

And then just one last follow-up. How is the new distribution performed whether it’s SOS Urban Outfitters, and how do you see a goal for that going forward?

All well across the board. Generally speaking, those have all performed well for us. We have some assortment opportunities in places like Foot Locker where the core new male has sold well to their consumer, but we see opportunities for evolving that specifically for their consumer. But generally speaking, inventory levels and sell-through have been healthy and the accounts are pleased.

And our next questioner today will be Jim Duffy with Stifel. Please go ahead.

Steve, question for you. The objective EBIT margin you were talking about 13%, you're now looking at high 14% through fiscal 2019. If that I heard you correctly in response to Dana's question, you're thinking there's maybe 100 150 bps of give back in the gross margin. Are there organic areas of improvement in the gross margin that are going to be an offset to that?

Yeah. So again we are -- as we indicated, we're not completely through all of the COG savings in our original plan that we articulated kind of two years ago. So we do think there is some smaller incremental improvement that still to come next year. So while there will be -- we wouldn't factor in these one-time benefits that we saw this year. There will be a bit of a setback, but there will be smaller not like what you've seen kind of in the last two years in terms of gross margin improvements. But there is still some opportunity for a little bit more improvement.

Good. And then you've been tightening the belt for some time now. It sounds like some planned areas of reinvestment, and you spoke some of those. Is there additional savings, wraparound savings into fiscal 2020 that can be an offset for some of that reinvestment?

Again, the way we're looking at it and we haven't given guidance. But we think, as Dave mentioned, there is more top line growth. We think through kind of disciplined management of SG&A that we can achieve leverage. It doesn't necessarily mean it's going down, but there can be some offsetting savings as we look out to next year.

Okay. Great. And then last one for me just updated thoughts on objective retail footprint given what you saw coming out of the key selling season?

Yeah. We're continuing to make progress on operationalizing our fleet and improving store performance both on -- more so on improving the operating contribution that fleet and the teams have made great progress there. We've been doing a lot of renegotiating of leases when leases come up and that has allowed us to keep some stores open when we may have had them on the closure list. So it's one of the things we're continuing to evaluate. Part of that optimization is continuing to optimize labor, elevating the presentation and storytelling and store getting new categories to activate such as men’s and lifestyle, improving merchandising and renegotiating leases. So -- we're moving away from setting a target of stores out there. But I think the goal is to make sure the overall fleet is hitting our internal operating margin metrics that we've established and the teams are making good progress on that and it something we're going to evaluate as part of our overall strategy.

And our next questioner today will be Chris Svezia with Wedbush. Please go ahead.

I just wanted to -- just on the UGG brand if I have that correct. So -- flat for this year right now is the outlook. But I recall because of the segmentation and some of the strategic alignment and some retail store closings there were $50 million in sales that kind of came out of that brand. But kind of back into it maybe up low single without some of those changes. Is that sort of how we should think about the UGG brand as we sort of move forward the ability to generate low single digit growth or any color about changes or segmentation strategies as we go into next fiscal year that we should be mindful about?

Well I think I'll speak to the changes and strategy. I would say no. I think we're going to continue to build on those strategies. I think the allocation and the whole back of the Classics on the channel has proved to be healthy and created some demand across the brand in the marketplace. I think the segmentation -- this is really the first full year where we've seen true product created specifically for accounts and the younger consumer. That's played out very well. So we're going to continue to build on that. And I think some of those new categories will start to be meaningful and help us get to that low single digit growth over time but still maintaining a tight control of the core classics business.

Yes, and I think, Chris just to add on that. You know what we've talked about. It really is kind of execution and everything we've been talking about kind of especially for the last year and kind of two years figure. What we intended and I think what we've successfully executed was really a strong allocation and segmentation strategy this year. And the idea was it was going to put some pressure on growth for UGG. We knew that. That's kind of the way we laid it out. The quarter played out a little bit better. But with that strategy in place what it did do was build sales in other categories as Dave mentioned. And so now going forward we are building off that base. So you're going to start to see that growth kind of coming next year.

And I also think that the success of the UGG men's in the quarter is a great indicator of some of the opportunity going forward as well. That has reached contribution of 15% of total brand sales now up from 13% last year. We still think there's significant opportunity in men's in with new consumer and in global distribution. And that's when we're going to continue to focus on to bolster the total line of the UGG brand as well.

And then just if I want to go back to your comments about some of these onetime -- benefit this year breaking from sort of the full price sales, reduced airfreight et cetera. And just a comment about potentially lower operating margin. Is it fair to say that you would potentially consider reinvesting some of the operating margin benefit that you've seen which has outperformed back into the business, whether it's marketing, things of that nature or how should we interpret that comment? If you give any color.

Absolutely. That's exactly the way we're looking. And I think again this quarter somewhat demonstrate the opportunity that we have, not only with UGG and kind of the success we saw on those areas, but again with HOKA and Koolaburra. And so we do intend to use some of those dollars of over performance to reinvest in the business to drive some of these growth drivers that we have.

Yeah. I think it's our responsibility to do that going forward for the long-term health of the brand and the business with sustainable healthy growth. We proven that we have growth drivers and opportunities in HOKA and UGG men's and non-core category products in women. Spring and summer is continues to be opportunity for us. We had a great meeting earlier this week about segmenting our marketing spend going forward differently by quarter, and allocating against a different categories globally. And I think with additional marketing efforts targeted against the right consumer there we can continue to drive growth in the UGG brand. In addition to that I think we have some investments to make in IT and digital marketing. And so we're going to balance the spend and the operating margin improvements over the next three to five years to be focused on healthy sustainable growth by returning good value back to shareholders, and we think we're in a great position to start doing that.

And the next questioner today will be with Mitch Kummetz with Pivotal Research. Please go ahead. I apologize as it is Laurent Vasilescu with Macquarie. Please go ahead.

Good afternoon. Thanks for taking my questions. Thank you for all the color on the revenue shift between 4Q and 3Q. I just curious any thoughts on how should we think about the international versus U.S. revenue change for the fourth quarter? Should we assume the international was down mid-teens while the U.S. is flattish?

Yeah. I think the -- when you say that you're saying compared to last year, right?

Correct, yeah.

Yeah. So I think that's a fair way to kind of look at it.

Okay. Okay. Very helpful. And then, on gross margins for the fourth quarter, it’s implied to be slightly down if you take the annual guidance. Is that the right way to think about in terms of maybe down 50 bps, and can you maybe talk about the headwinds and tailwinds for the entire fourth quarter?

Yeah. It’s kind of more flattish the last year, and I think the way to look at that was -- as we looked at the quarter, we saw a very strong January last year. This year January started out not as strong as the year ago. So as you recall, there was a little bit of a different weather pattern last year versus this year. Last year cold late December, carried through January. This year, we had a good colder October and November, but warm December that carried through the beginning of January. And there's a lot of selling in January. So we've included that really in our guidance of how we're looking at fourth quarter. So it's not down as much as you said more flattish to down a little bit, really taking that into consideration.

Okay. That's very helpful. And then I wanted to follow up on airfreight initiatives. I think obviously last quarter there was a benefit. Was there a benefit this quarter? And then, asking different way how much do you airfreight as a percentage of your overall business and where do you think that goes over the next year?

Yeah. We haven't necessarily kind of given that. What we said last quarter as you recall we said there was about $6 million of airfreight that we have planned that we didn't use. And so we think going forward that won't necessarily always be the case. It's going to kind of depend on how we're bringing product to market, where the orders are, how quickly we need to bring product in. Clearly, we have gotten better. And we think there will be improvements from where we were a year ago. We think this year was an extremely clean year and will be a little bit conservative because you know there's going to be certain styles especially as we move beyond kind of the core classics that there's going to be a need to bring product in quickly to the market. So we'll be anticipating some of that.

Yes, I think that's the right way to think about it. You know in the past we've used airfreight to compensate for poor planning our inventory management. I think we've addressed all that. And going forward we're going to use it more strategically to chase businesses fast-tracking product and getting after opportunities that arise in the quarter.

And this will conclude our question-and-answer session as well as today's conference call. Thank you all for attending today's presentation and you may now disconnect your lines.