Greetings, and welcome to the Graham Corporation First Quarter Fiscal Year 2015 Financial Results. [Operator Instructions] As a reminder, this conference is being recorded. It's now my pleasure to introduce you to Deborah Pawlowski, Investor Relations of Graham Corporation. Thank you.

Thank you, Jerry. Actually, it's Karen Howard of Investor Relations with Graham, but Debbie is here with us as well. But thank you and good afternoon, everyone. Thank you for joining us to discuss our results for our first quarter of fiscal 2016. We certainly appreciate your time today. You should have a copy of the news release across the wire this morning detailing Graham's results. We also have slides associated with the commentary that we're providing here today. If you do not have the release or the slides, you can find them at the company's website at www.graham-mfg.com. On the call with me today are Jim Lines, our President and Chief Executive Officer; and Jeff Glajch, our Chief Financial Officer. Jim and Jeff will review the results of the quarter as well as our outlook. We will then open up the line for Q&A. As you are aware, we may make some forward-looking statements during this discussion, as well as during the Q&A. These statements apply to future events and are subject to risks and uncertainties, as well as other factors which could cause actual results to differ materially from what is stated on the call. These risks and uncertainties and other factors are provided in the earnings release and in the slide deck, as well as with other documents filed by the company with the Securities and Exchange Commission. These documents can be found on our website or at www.sec.gov. And with that, I'm going to turn the call over to Jim to begin. Jim?

Thank you, Karen, and good afternoon, everyone. Welcome to our first quarter fiscal '16 conference call. I am on slide 3. We are executing our strategy to expand earnings by focusing on our distinct assets, be they be our selling process, our engineering capability, customer fabrication capabilities, along with our capital assets to capture greater market share and to expand our business. We're focused on improving the level of our predictable base business and in diversifying and strengthening our revenue streams. Our key markets are refining, chemical, petrochemical markets, power generation and serving the U.S. Navy. Short-term objectives include driving top line growth through capturing greater market share. Our near-term objective is to expand revenue to over $200 million across this cycle. And longer-term, continue to leverage our distinct capabilities via diversification and expanding market share to continue to grow value for our customers and value from Graham. Please turn to Slide 4. Highlights for the first quarter include: Revenue at $27.6 million, which compares to $28.5 million for the first quarter of fiscal 2015, down 3% year-over-year. First quarter net income was $2.4 million, or $0.23 per share. This is consistent with a year earlier, with net income at that period of time, $2.4 million or $0.20 a share. Return on sales was 9% in the quarter. Backlog remains strong at $110 million. We also took action to level backlog conversion and spread revenue conversion across several quarters in addressing the change in outlook in our markets. We've also scaled back our costs, the actions taken at the end of the fourth quarter to reduce our fixed cost base. I'm on to Slide 5. First quarter sales were 36% from International markets compared to 22% last year. This was driven by increases to the Middle East as well as our other markets. We did have strong refining industry sales, with refining industry sales at just under $8 million. Chemical and petrochemical processing industry sales were just a bit above $11 million in the quarter. Power industry sales, $3.7 million. Our annual revenue for the trailing 12 months is $134 million. Slide 6, please. I spoke a moment ago about the efforts and our focus on expanding our predictable base business. I've been very pleased with our progress there. Compared to 10 years ago, we've expanded that by 2.5x from what had been around $20 million back in the mid-2000s to just over $50 million last year, fiscal year '15. Our goal and our expectation is to exceed $60 million from this segment of our business, which includes nuclear market MRO, executing our naval strategy, our aftermarket strategies and our short cycle new equipment sales. The important aspect of this strategy is that we'll reduce earnings volatility as this segment is less cyclical. I'd like to turn it over to Jeff, for Jeff to review the financial performance.

Thank you, Jim, and good afternoon. We're on Slide 8. As Jim mentioned, our sales in the first quarter were down a little bit from the previous year, yet our gross profit level was similar to slightly above it, as we saw our gross profit margin increase by 130 basis points. The 130 basis point increase was driven by the mix of products that went through our facility in the first quarter versus last year. EBITDA margin was flat for the year, and our EBITDA was just down slightly. And our earnings per share was off $0.01 although the earnings from $1.00 standpoint were equivalent. On to Slide 9. Our cash position remained strong. We saw cash increase by $2.3 million in the quarter. This was driven by our cash provided by operations. Capital spending was relatively low in the quarter at $300,000. We do continue to expect capital for the full year to be between $2 million and $2.5 million. I do want to comment just briefly on our stock repurchase program, which was approved in January of 2015. We had not purchased any shares through the end of the first quarter through the end of June. However, since the beginning of July, we have purchased approximately 75,000 shares, with a total cost of $1.4 million in the month of July. While this stock repurchase program is important, it is secondary to our intent to utilize our cash balance to invest in both the organic business, and the majority of that cash balance is really focused on investing in acquisition opportunities to grow our business inorganically. With that, I'd like to pass it back to Jim to discuss the outlook for the remaining part of fiscal '16.

We've continued to have order volatility due to end market fundamentals. Approximately 32% of our first quarter's new orders were from the refining industry. We are continuing to have a difficult time predicting when orders will release from our refining and petrochemical markets. While we have a healthy pipeline of opportunities, timing and certainty is still in front of us. Geographically, first quarter orders were approximately 2/3 domestic, 1/3 international. On a trailing 12-month basis, the order level was just under $130 million. On to Slide 12. We still have a terrific backlog that's at $110 million. It's very diversified and it shows the strength of our Naval strategy, which represents almost half of the backlog at this point in time, 48%. Importantly, 55% of our backlog is from customers or markets the company did not serve 5 years ago. Our backlog is different which needs to borne in mind in that it is more extended in terms of the conversion cycle. At this current point in time, 45% to 50% of our backlog will convert over the next 12 months. Ordinarily, going back several years ago, that was closer to 90%. And today, 40% to 45% of our backlog converts 24 months or later from now. We are confirming 2016 full year guidance is unchanged, with revenue between $95 million to $105 million; gross margin ranging between 26% and 28%; SG&A, as a percent of sales, expected to be between 17% to 18%; and our effective tax rate of 32% to 33%. While we're managing through a difficult set of market fundamentals in refining and petchem markets, our strategy and vision is on growing Graham, and our long-term expectation is to continue to grow Graham with our near-term goal of exceeding $200 million of revenue across the cycle. With that, I would like to turn the call, Jerry, over to Q&A. Thank you.

[Operator Instructions] First question is from Joe Mondillo, Sidoti & Company.

So first question. Just wondering if you could talk about sort of the oil refining business in general. It seems like the orders were pretty solid in the quarter. It doesn't seem like you have a ton of visibility. Any color that you can give for what you're feeling with your customers? It seems like the refiners in general are actually doing quite well. So any other color that you can give us regarding projects or demand there?

You are correct, Joe, in that the refineries themselves are doing quite well financially. We still do have a great amount of bid work for the global refining markets. The behavior of the refining industry really depends upon what type of refiner it is. Our national oil companies, they're still in an unpredictable period with regards to what financial constraints they're having tied to the price of oil. That is similar to what we're seeing at integrated refiners who have both exploration and production along with refining assets. While the refining assets are performing extraordinarily well, they are still conserving cash and pulling back on CapEx in the near term to address the headwinds they're having on revenues and cash flow. For an independent refiner, that's where we're seeing some vitality and the most enthusiasm, perhaps a little better predictability around order timing because they're less affected by the price of oil. In general, we still remain very encouraged by the level of activity in the refining sector as our gauge being the amount of bid activity. However, we are still regrettably at a point in time, Joe, where we don't really have an easy methodology to predict when orders are going to be released.

So for you, has anything really changed over the last 6 months? Has it been sort of this wait-and-see, uncertain type of time over the last 6 months? Or has anything over the last 2 or 3 months gotten you any more positive or negative at all?

We're still in this foggy area. The recent fall back from what had been roughly $60 a barrel to roughly $50 a barrel, that has a negative implication because we were beginning to believe we were on stable ground at around $50 a barrel. In our view, the catalyst for getting back to business as usual is stability around the price of crude oil, such that there's predictability projecting financial returns and they're on solid foundation from which they project. So we really haven't had feedback from our customers. And the catalyst is now in front of them and they're feeling very encouraged in the short-term. What we are hearing is these are short-term headwinds. Long-term investments will be made. Discretionary decisions to delay investment for maintenance-type purposes, that can only be done for a short period of time. So we do expect that our level of orders that would relate to more of refinery upkeep or investing in Brownfield assets will return to normal before large CapEx for new capacity, and that's a very important segment of our sales. It could be of equal importance to new capacity. So we think that occurs sooner than investment in new capacity. And, as I said, those discretionary decisions to delay those types of investments, they can only be done for a short period of time, in our view.

Okay. And then, I thought it was interesting in regard to your domestic versus international orders. The domestic orders have actually been relatively stable for the last 5 quarters if you take out the Navy order that you saw in the fourth quarter. What are your thoughts on that? I would have thought North America would have been hurt relatively big as well, as well as the international field. But what are your thoughts on domestic sort of holding up, it seems, like on the order side?

Within our domestic sales, going back to our predictable base, excluding the Naval type of work, our short cycle work, our nuclear MRO work, much of our aftermarket largely is domestic-oriented. So that's fairly stable, less difficult. And when the large capital work globally pulls back, that becomes a more important weighting of our overall orders. So there is that effect that's at play, and we're also seeing some investment by the refining and petchem market in North America, although by no means is it predictable or like 18 months ago. But we did win another ethylene project and we have won some refining work in this last quarter, which was encouraging, but it's not indicative of the rapid pace we saw for order placement 24 months ago.

Is there any difference in margin of the work that you do internationally versus the domestic work?

In general, yes. North America provides the best margin potential, however, some international work is comparable. It depends on the region, and we view the Middle East and some South American opportunities as providing similar margin potential as the U.S, whereas Asia has a bit of a different margin potential. Not bad, just different. It's worse, but it's not horrible.

So regarding the backlog, if we're seeing domestic orders hold up, international sort of being a little weaker, are you seeing sort of a mixed shift in gross margins in the backlog? And also just regarding gross margins, you had a very good first quarter. It seems like the low end of the guidance would imply very low gross margins, even lower than when we saw in the 2009, 2010 downturn. So that's sort of a two-part answer and then I'll get back in the queue.

Sure. As we look at the orders being booked, and from an accounting margin at order entry, they are strong. When we look at the absorption and factory utilization as our throughput drops, that's where we begin to have the margin erosion. So while we have an as-booked accounting margin, that's assuming some level of absorption. As our utilizations decline, as the revenue drops, we have an absorption affect that's counterbalancing that. In general, we are expecting because of the underloading in our facilities have that margin penalty, which is what our guidance reflects.

Okay. And then I guess the second part of the question was just relating to the guidance in terms of the low end of the gross margin guidance, that would imply that gross margin would have to fall off pretty big, sort of to the mid-20s. Is there a quarter or 2 that we should expect a possibility of that?

If we think about our order pattern from Q3 to Q4, extracting the Navy work, there is a fairly appreciable underloading of our operations as that backlog converts into revenue. That will begin to show up in Q2. That's just the timing of backlog conversion and that's a fact that we have to deal with -- the level of bookings that we had in Q3 and non-Naval bookings in Q4. So that will have an effect due to the leverage that we just spoke about, the absorption of overheads. While the booked margin looks fine, the actual translation of that margin to a realized margin due to absorption negative impact shows up in Q2.

Next question is from Paul Dircks, William Blair.

Just a couple of questions here for me. First question I have is also related to the backlog. So it looks as if you had a nice uptick in power awards during the quarter. Was this due to any particular projects, or is this more of a sign of some your enhanced focus on driving growth at Energy Steel?

We are focused on driving growth long term in Energy Steel. That has not been realized yet. I would not -- at this point, encourage projecting from the power market orders in Q1. We haven't had the lift yet that we're anticipating from our nuclear utility strategies.

Okay. That's helpful. What was behind the award performance in the quarter in power?

Just timing of some non-nuclear related orders that aren't there always. More of a one-off. From our renewable energy markets.

Got it. Okay, that's helpful. Any update you guys can provide on the timing of the next Navy carrier award?

The best we can judge is it should be out for bid in calendar '15. And we would expect it to be placed in calendar '16 as best we can judge. So it could be a fiscal '16 booking, but more likely a fiscal '17 order.

Okay. That's also helpful. Two more for me quickly here. Maybe this is more of a qualitative question, but how does the margin profile of some of the recently booked awards here in your legacy markets compare to that of your legacy markets awards back in fiscal 2010 coming out of that downturn?

I would say on average, they are up a little bit. That was a tough time in 2010, but it was some of the work that was secured. I can say, though, while we've had okay margins that we've secured, there are some incredibly rough margin opportunities out there, and some of it we didn't win. And we're seeing our competition, I'll characterize it as applying reckless pricing policies. We will have some situations where we will step in to protect our turf, our market share, and prevent an entrance into a key account. But thus far, answering your question, we haven't really seen that affecting our book margin and backlog. But I want to be clear, there is some tough stuff out there that we may take.

Is some of that tougher pricing domestically or more internationally?

Generally more internationally, but we are seeing -- I don't want to have this bit too much waiting, but it's a little more anecdotal, but we are seeing it at times in our domestic market. It depends on the end user, their sensitivity to price versus value. And we have seen some unusual behavior with certain of our customers. I want to characterize it as anecdotal, but it's there enough that it's on our radar screen.

Okay. That's helpful color. Another question for me. It seems as if you guys are being more assertive certainly with your commentary regarding on acquisitions. Maybe you could talk about how you're evaluating the prospects out there in the marketplace? And is your expectation for pricing to further improve for some of the targets you're considering? Or has it already improved? What's really driving -- what seems to be an incremental confidence in making an acquisition?

Paul, I think it's more incremental focus than necessarily confidence. But I guess from that focus perhaps one gets additional confidence. As we look at this time last year when we have very strong organic ramp head of us, we had taken the foot off the accelerator a little bit on looking at acquisitions. We have refocused both management and the board is very supportive of our acquisition activity. And we have moved that up on the agenda of things to look at. So it's really more focus on our part rather than anything beyond that. With regard to pricing, pricing is still a little bit rich right now. There's a lot of buyers chasing things. So we haven't seen a meaningful drop down in price yet, but we'll certainly keep our eye on that.

We have a question from Peter Rabover, Artko Capital.

I had a few questions if you don't mind. One, maybe if you guys can talk about your backlog and your recurring business. How much of your recurring business is in the backlog? Or should we think of those two separately?

I'm going to give it my definition to make sure I'm calibrated to your question. Our recurring backlog, or our predictable backlog, which I would put in as aftermarket and some short cycle work, x-Navy, is typically around of our backlog we have now, probably 10% to 15% of the backlog fits into that category. If we include Navy, which we are characterizing as our predictable base because of its long conversion cycle, then that's nearer to 60% to 65% of our backlog.

Okay, so the $50 million to $60 million number that you're talking about, part of it is in the backlog?

Yes.

I mean, that's good. And I think the first caller answered a lot of this, but maybe I wanted to follow-up on the refining and petrochem markets. Are there any things that you guys look at, longer-term, that kind of drives the market that you've noticed over the years, is it the spread, the WTI spread, or the capacity utilization, something that we could probably pay attention to as well?

Capacity utilization certainly comes into play. It's primarily correlated to the price of crude oil from what we have seen. And they tend to come in, in very tightly clustered increments. And as our refiners are focused on economy of scale, for example, when I started at Graham 30 years ago, a world-scale refinery may have been 150,000 barrels per day. So therefore, we get 1.5 million more barrels a day there were 10 refining projects. Today, a world-scale refinery is 400,000 barrels per day. And you may have seen the press release for the Kuwait Al-Zour refinery is 600,000 barrels per day. So therefore, for an incremental 1.5 million barrels per day of additional refining capacity instead of 10 opportunities, there may be 5. But it's a different dynamic, and they come in larger increments and more clustered from what I would characterize as the '80s or '90s.

Okay. That's very helpful. Have you guys looked at what the impact would be if the oil export market has been repealed or the Jones Act would be repealed? How would that affect the refining markets?

Well, being able to export, that would be helpful to us. And I think that would then drive more investment in the Brownfield sites that are already here, which move more quickly. So I do view that as advantageous to us. I cannot comment on whether or not that's highly probable.

Right, I just wanted to see what you guys were thinking on the impact of that. And I guess the last question and I know you touched about the acquisition stuff. But maybe on a larger scale, how do you guys think about capital allocation longer-term, I mean especially given the large cash balance that you have?

We think about capital allocation that's on the balance sheet, our primary focus is to use that for growing inorganically via acquisition. That is our foremost focus. And then we obviously have a share buyback in place. By that's a very distant second to utilizing it for acquisition. If I can take a second cut at that also, if you look at the way we think about our annual cash flow, from earnings, from operations, our main focus there is to reinvest in our business. And there's enough annual cash flow that reinvesting in our business is more than covered by that annual cash flow. And then secondarily on the annual cash flow is payment of dividends. And obviously, we have enough cash flow to do both on an ongoing basis. So again, the annual cash flow is organic growth and dividends, the balance sheet is acquisitions and the buyback is a distant second.

Okay. I mean, are there metrics, return on cash, return on capital? What are you guys looking at in terms of...

Sure. Yes, I mean, we're certainly focused on our return on capital. If you look at our return on capital, we look at it 2 ways. We look at it in total capital and then we look at it excluding cash given our large cash balance. But we believe, long-term, it's most important to look at it including cash, which puts the requirement to get some return on that cash. So return on capital is very important to us. So obviously, we don't have debt. So return on equity, return on capital are pretty much the same.

We have a question from Brian Rafn, Morgan Dempsey Capital Management.

Let me ask you -- Jim, you had some very good color on what you talked about in the refinery area relative to kind of maintenance -- they can only put it off so long. Is the pent-up demand there the delay and say maintenance cycle versus new capacity, could that be put for months, or is that 18 months, a couple of years, how long can they forgo that discretionary?

This would be my judgment, or my observation. I think those discretionary decisions around maintenance, revamp replacements has a several quarter duration not too much longer than that, because the wrong decision there and an unscheduled shutdown is very dramatic and traumatic. So I feel it's shorter in duration than 18 months as an example, if that answered your question. Are you still there, Brian? We may have lost Brian.

Yes, I'm here. I can hear you. Good answer. Let me ask with the investment you guys have done the last several years, getting to your $200 million sales revenue long-term goal [indiscernible] investment, CapEx, employees, if we have a kind of a lull here with the oil and gas at spot rates, what are you guys doing relative to SG&A headcount? Are you furloughing people? Extending vacations? Is your usage or utilization of employee talent -- can you find other jobs, short cycle work or whatever, to do?

We're focused on keeping the team and not taking near-term action for a few pennies on profitability. And the mandate to the sales organization is to focus on volume, less focused on the quality of the order intake, drive order intake, drive up factory utilization and give our team work to do. And that's focus on our short cycle segment, our aftermarket segment and any capital sales that are out there. We are taking an urgent view that we want that work. We're not being imprudent about our pricing policies and our pricing discipline, but we are chasing volume to fill up our capacity and give our team work to do so we don't have to implement countermeasures. We do have countermeasures that are in place that if our scenario analysis is different than what our judgment has been, we will take further action, however, we realize the order intake. We utilize our assets, both physical plant and people. We don't have to execute our countermeasures and that's my hope.

Okay. Good. I appreciate it. Let me ask you, Jim, on the Navy side. One of the things the Navy is doing certainly on its surface fleet, both the carriers, now the DDT destroyer, is a massive increase in the ability of electrical capacity generation of those ships for the carriers -- it's with the EMALS, catapult, for some of the smaller ships, the cruisers and destroyers, it's lasers and electromagnetic rail guns. When you guys moved from CVN 79 to Kennedy to CVN 80 the Enterprise, is the same -- I think its condensers that you guys put in. Do you see specification, size, technology change between carriers?

We haven't seen the use of the non-steam catapult system affecting the size of our surface condensers. Therefore, 78 appears to be the same size as 79, it appears to be the same size as 80 or 81. We're not seeing those progressive changes in carrier architecture affect our equipment.

Okay. Right. Good. And then, just anything on the next generation, fleet ballistic missile sub boomer for the Ohio Class for you guys in the sub area?

Nothing new to report there. And bearing in mind, there's little that we can say, other than on prior calls, we have acknowledged that we are executing our strategy, which involves participation in the 2 submarine programs. And we have entered both with some work in our backlog.

Okay. Jeff, do you have a price on the treasury repurchases. You had an overall value, but you don't have a share price by chance?

Not at this point. I did not put that out there, no.

We have a question from John Bair, Ascent Wealth Advisors.

Sorry, I couldn't make the meeting this morning. But I've got a question kind of going back to this refining thing. As I understand it, the capacity utilization in the U.S. is something in the order of the mid-90s. And on that basis, it would seem to me that there would be a lot of interest in expanding the capacity of existing facilities and so forth. And I'm wondering if you have any sense that perhaps projects to do that, expand or upgrade, might be being pushed off into the winter months when traditionally gasoline demand is lower, and that maybe there'd be some release of projects at that time?

John,we haven't noticed that, what you commented on. What we have noticed, and you hit a very important point and I'll confirm. We remain very committed and very bullish long-term about energy, about domestic refining, about global refining. What we're seeing now is focus on maximizing what they get from the existing refining assets, willing to make certain investments, Brownfield investments, to improve, they call it yield conversion or bottom-of-the-barrel conversion, to make sure they're optimizing from a barrel of oil input into the refinery, they're converting as much as they possibly can to value refined products such as transportation fuels. But invariably, those revamps, those de-bottlenecks, those capacity improvements to create greater refined products, the fact that distillation columns affect the downstream processes where our equipment is, we're involved in those critical processes. And as they de-bottleneck, we look at how to improve yield conversion. We benefit from that greatly. And that's where we're seeing the attention now by the refiner because those have quick paybacks, the ROIs, or the internal rate of returns are strong. And those seem to pass-through relatively quickly through the budgeting process. That doesn't mean a floodgate is opening, but we're seeing enough conversation that it has us enthused about Brownfield domestic investments, which we categorize as capacity creep.

Okay. Maybe out in California, they'll start opening some stuff up. I'm sure those folks out there aren't real happy with their high prices. On a related note, earlier this week, I saw an article that indicated 3 pretty significant projects in Egypt. One was a $1.5 billion modernization project. Another one was a $1.4 billion project expanding an existing refinery from 100,000 to 160,000 barrels a day and then 2 other refining upgrades. So my question here is, I'm sure you're aware of those, if I am, and where in the process, once those things let go, so to speak or commissioned, do you potentially come into the picture of picking up some of that business?

In general terms, just looking at the timeline, if a refining project is 5 years in duration, we typically are participating in the awards that are in the first 6 months to 18 months. And then the revenue recognition is 12-ish to 15 months after we get the award. Now we're often considered a long lead or critical item in the refining process, and we might be involved in the first wave of procurements, which is why it might happen as early as 6 months in that 5-year timeline. So we tend to be in the first 1/3 rather than the second 1/3 of the cycle.

Well, one of them was supposed to be operational by late '16 or '17. One of the total had a $1.5 billion modernization upgrade, and the total project was close to $3 billion. So I would think, hopefully, you're in there. It doesn't matter, it's going to be close to it. And to your comment earlier, Jim, about world-class refining facility being 400,000 barrel a day. Would that mean that those larger projects -- would that mean larger dollar order for Graham?

It does mean the order size would be larger. But in a general sense, due to the economy of scale going back to the example that I've cited, instead of 10 smaller orders adding to a total aggregate opportunity set, there might be 5 or 6, but generally because of the economies of scale, the total dollar spent for 6 would have been less what would've been spent for 10. But the order size in isolation is larger. I wanted to let you know, really, we're thinking about it in terms of incremental capacity and the dollar potential.

Okay. And 1 last quick question is, with your capital expenditure plans, is there anything that you're seeing on the horizon beyond the $2 million to $2.5 million that you're expecting for this year? Beyond that, are you kind of on-hold then other than just minor things? Or kind of sit back and wait and see how this plays out over the next 6 to 12 months?

Well, we'll be watching the market fundamentals. It's not our intent to play defensively. We are thinking right now with the investments that we've made the last a couple of years, or over the last 6 or 7 years we have invested $18 million of capital -- we want to digest that, grow into that, make sure we've optimized that. And in that context, we would have CapEx nearer to depreciation, or maybe 1.5x depreciation as more normal. However, having said that, there's clear mandates by the operations team to create throughput, to create productivity. And as we take on additional work, say additional naval work, there could be some large CapEx's that would be around machining type of equipment, not to the magnitude of the $6.5 million we made, but more instead of $2 million or $3 million we might have a $4 million, $4.5 million a year, tied to a particular situation. So that's how we're thinking about it. But I just want to let you know that we are taking what we just invested, which is a fair amount of money. We're making sure we've optimized our utilization of that investment and getting the right return from that, tasking the team to leverage that. However, we are also tasking the team to create productivity and improve throughput. And if that means capital and it has an appropriate equity-based return, we'll fund that investment.

Ladies and gentlemen, at this time, there are no further questions.

Thank you, Jerry. We appreciate everyone's time on the call, and for your questions. And we look forward to updating you on the next conference call. Thank you. Have a good day.

This concludes today's teleconference. You may disconnect your lines at this time. Thank you for your participation.