Good morning, ladies and gentlemen, and welcome to Group 1 Automotive 2020 Second Quarter Financial Results Conference Call. Please be advised that this call is being recorded. I would now like to turn the call over to Mr. Pete DeLongchamps, Group 1's Senior Vice President of Manufacturer Relations, Financial Services and Public Affairs. Please go ahead, Mr. DeLongchamps.

Thank you, Chuck, and good morning, everyone, and welcome to today's call. The earnings release we issued this morning and a related slide presentation that include reconciliations related to the adjusted results we will refer to on this call for comparison purposes have been posted to Group 1's website. Before we begin, I'd like to make some brief remarks about forward-looking statements and the use of non-GAAP financial measures. Except for historical information mentioned during the conference call, statements made by management of Group 1 are forward-looking statements that are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. The forward-looking statements involve both known and unknown risks and uncertainties, which may cause the company's actual results in future periods to differ materially from forecasted results. Those risks include, but are not limited to, risks associated with pricing, volume, conditions of markets, adverse developments in the global economy as well as the public health crisis related to the COVID-19 virus and resulting impacts on demand for new and used vehicles and related services. Uncertainly regarding the duration, severity of COVID-19 and its impact on U.S. international authorities use current restrictions on various commercial and economic activities. And uncertainty regarding the timing, pace and extent of an economic recovery in the U.S. and elsewhere from the unknown current and future impacts of COVID-19 and the unknown future impacts of oil producers and the effects such that can have on travel, transportation and oil prices, which in turn will likely adverse affect demand for our vehicles and service. Those and other risks are described in the company's filings with the Securities and Exchange Commission over the past 12 months. Copies of these filings are available from both the SEC and the company. In addition, certain non-GAAP financial measures, as defined in our SEC rules may be discussed on this call. As required by applicable SEC rules, the company provides reconciliations of any such non-GAAP financial measures to the most directly comparable GAAP measures on its website. Participating with me on the call today, Earl Hesterberg, our President and Chief Executive Officer; Daryl Kenningham, our President of U.S. and Brazilian Operations; John Rickel, our Senior Vice President and Chief Financial Officer; also Daniel Mchenry, who is our incoming Chief Financial Officer; and Michael Welch, our Vice President and Corporate Controller. I'd like to now give the call over to Earl.

Thanks, Pete, and good morning, everyone. The business and personal experiences, all of us have been through since early March are difficult to describe. The challenges and uncertainty we have faced in recent months are unprecedented and I believe that makes our results this quarter extremely impressive. Our original goal was to keep the company afloat and stabilize it financially in the face of an uncertain period of shutdown as we entered April in the second quarter. Therefore, our $69.6 million of adjusted net income and $3.70 of adjusted earnings per share, are nothing short of a spectacular performance. These numbers represent 32% and 33% increases, respectively, over last year's second quarter numbers and were accomplished despite a 29% decrease in total revenues. Clearly, these impressive results demonstrate the resiliency of our business model and the brilliant efforts of our employees. Unfortunately, they also represent extremely decisive and aggressive cost cutting actions we took across all three of our markets in late March when it became clear that many of our businesses will be virtually locked down due to a variety of shelter-in-place orders in all three of our markets. This resulted in many of our employees, nearly 8,000 in total, being furloughed by early April. These were very painful actions to take but were necessary due to the unknown duration of the business shutdowns. At this point, we've been able to return many of our furloughed workers to a point where our U.S. and U.K. headcounts are roughly 2/3 of our pre COVID levels. Additionally, a large number of our remaining employees made sacrifices with reduced compensation and benefits as well, and we are beginning to reverse some of these actions as we see the market further stabilize. Looking at the track of our U.S. and U.K. businesses during…

Thank you, Earl. Our outstanding U.S. second quarter results were due in large part to our team's ability to move quickly to reduce our cost structure. Adjusted SG&A as a percentage of gross profit decreased to a record 59.3%. Our new and used vehicle gross margin improvement certainly helped this performance, but it's important to note that while our gross profit declined by 15% or $57 million from the prior year, we reduced our SG&A by 28% or $74 million. Our second quarter new vehicle volumes declined 28%, and used vehicle volumes were down 14%, the latter of which was caused by inventory shortages. However, gross margin was extremely strong. New vehicle gross profit per unit was up 40% in the quarter. And after a decline in April used margins, they improved dramatically as well, finishing with a 62% increase in the month of June. Our after sales business accelerated throughout the quarter. While we were down 19% in total, we saw dramatic increases as the quarter progressed. June total after sales revenue was down less than 2% while our June customer pay gross profit was up over June 2019 and more customers than ever scheduled their appointments with us online, over 30% of them. AcceleRide was a great story for us during the second quarter. Our new branding and a more streamlined process are already creating a better customer experience. Nearly 3,000 customers used our digital retailing tool to purchase a car online, up 48% from the first quarter and nearly triple our levels from a year ago. Our teams and our customers have embraced AcceleRide and we will continue to build on that success. Over the past few months, we've also added the ability to buy cars from customers through AcceleRide. And 100% of our locations now offer a full suite of finance and insurance products through the platform. In the months ahead, we will add more flexible customer financing options. And this fall, we are launching acceleride.com, which will offer customers an additional way to access AcceleRide. Finally, we plan to launch AcceleRide in our U.K. market by the end of the year as well. Turning to Brazil. We realized a small loss during the quarter but turned profitable in June as the macro environment improved. As with the U.K., our team did a fantastic job of cutting costs, reducing working capital and generating positive cash flow in an environment with much stricter shelter in place orders compared to what we experienced here in our U.S. markets. Before I turn the call over to our CFO, John Rickel, to provide a balance sheet and liquidity review, it should be emphasized that we expect to continue to leverage our leaner cost structure and should be able to a meaningfully lower SG&A as a percentage of gross profit going forward. Versus our pre-COVID historical levels. John?

Thank you, Daryl, and good morning, everyone. First, I will cover the adjustments for our noncore items in more detail. The adjustments made to second quarter GAAP net income totaled $39.4 million or $2.14 per diluted share. These net income adjustments consist of noncash asset impairments of $20.6 million and out-of-period adjustment to accelerate stock-based compensation expense for retirement-eligible employees of $9.7 million, a loss on the redemption of our 5.25% bonds of $8.1 million, and U.K. severance costs for $1 million. The $20.6 million of impairments relate to U.K. and Brazil intangible asset valuations that have been negatively impacted by the COVID-19 pandemic. Turning to our balance sheet and liquidity position. As of June 30, we had $73 million of cash on hand and another $108 million that was invested in our floorplan offset accounts, bringing total cash liquidity to $181 million. There was also $193 million of additional borrowing capacity on our U.S. syndicated acquisition line, bringing total immediate liquidity to $374 million as of June 30. Our cash flow remains strong as we generated $186 million of adjusted operating cash flow in the second quarter. Each one of our three regions generated positive cash flow in the quarter despite varying degrees of business closures. One of the most important strengths of this business model is the ability to generate strong cash flow, even in the difficult macro environment we experienced this quarter as well as back in 2008, 2009. This cash generation was partially used to reduce our non-floorplan debt by $77 million during the quarter and another roughly $80 million of our acquisition line borrowings has been repaid in July. Our U.S. credit facility rent adjusted leverage ratio was reduced to 2.99x at the end of June, down from 3.31x at the end of March. We…

Thanks, John. I suppose this is an appropriate time for me and management team to thank John for his many contributions to Group 1 over the past 15 years. John was responsible for the establishment of most of our operating infrastructure and our financial controls. I think most of our investors have come to appreciate John's detailed understanding of the automotive business as well as his sincere and straightforward style of communication. I can assure you that John will be sorely missed by myself and our team. We're indeed fortunate to have someone like Daniel McHenry standing by to fill John's large shoes. There will be a minimum learning curve for Daniel, as he is very familiar with the industry as well as our company and systems. Daniel will efficiently assume the CFO position on August 15. Additionally, we have a highly experienced global automotive financial executive to replace Daniel in the U.K. [Roberto Pereira] has served as the Financial Director of our Brazilian operation since 2014 and has experience with global companies such as Delphi and Siemens prior to joining Group 1. So again, we are fortunate to make use of our experienced management bench to backfill John's retirement from Group 1. As we move into the second half of the year, we intend to continue to remain flexible and responsive to market conditions. Sales and service traffic continues to fluctuate in some markets where COVID-19 continues to spread. New vehicle production, inventory and incentive levels remain quite uncertain in both the U.S. and the U.K. markets. Clearly, these factors both impact volume and margins. Our team has proven the ability to control and adjust cost levels quickly and effectively. That scale will remain important in the second half of the year. This concludes our prepared remarks. I'll now turn the call over to the operator to begin the question-and-answer session. Operator?

[Operator Instructions] And our first question will come from John Murphy with Bank of America.

First and foremost, I just want to congratulate John, a fantastic career and thank him for all of his insights over the years because we've learned a tremendous amount from him not just on Group 1, but from the industry. So thank you, John. Just a first question here, Earl, maybe sort of big picture and kind of strategic. The opportunity in the U.S. seems to be opening up based on the strategy of some of your competitors. And they're getting much more aggressive on building "national networks " and heading towards larger sizes here in the U.S. I'm just curious, as you look at that and juxtapose it versus your strategy of going international to the U.K. and Brazil. And if you see anything changing here in the landscape in the U.S. between the relationship between the distribution channel, the dealers and the automakers that might provide better opportunity than there has been in the past and you may rethink getting bigger internationally and see a greater opportunity here in the U.S.?

No, John. This is Earl. I think the U.S. is still the market of preference and I think that's true for auto manufacturers as well. I think the real shifts in recent years have been toward strength in the used car market and the service market. And it's difficult to justify big capital expenditures to buy a lot of land and get a good return on that just to have them dedicated used car operations unless you want to be the bank, right, which has been the key differentiating factor for CarMax. And we continue to reinforce to ourselves that we have a lot of upside in the used vehicle and service business, which is where the market is headed, within our existing physical plant. Now we do expand some of those physical plants, but we continue to operate most of our physical plants with multiple revenue and gross profit streams. And that seems to provide the best return on capital. We went to the U.K. originally to have another expansion opportunity at a higher return on investment because the purchase of new vehicle franchises there is much lower. And that continues to be the case. Unfortunately, in recent years, the U.K. market has really declined because of primarily the uncertainty relating to Brexit. We seem to be coming near the end of that timeline. And we continue to like the potential of those businesses, and we've used this complete shutdown period to retool our U.K. businesses. And I don't think I've ever been more excited about them. And we're going to come out of this more efficient than we've ever been in the U.K. and the U.K. is going to remain a good auto market for a long time. And we have a nice brand mix there and a good management team, and we're going to be much more efficient there as we are as we sit here today. I don't know if that answered your question, but that's kind of our overview of how we look at things.

Okay. And then just 2 quick follow-ups to that answer. I mean when you look at what went on with SG&A here, 59.3% in the U.S., I mean that's remarkable and should be applauded because it really is quite amazing in a disastrous time like this to execute like that. Just curious as you think about going forward, how much of the cost save is sticky? And to be a little bit tough on you and the industry, I mean, it always seems like there's this opportunity to flex SG&A down. It takes kind of a crisis period to kind of illustrate that you might be able to get down much lower than you've traditionally run at. Is there sort of this discipline that may be enforced by this the disaster that we're all going through and where this opportunity maybe to really persist to keep SG&A significantly lower structurally going forward?

Absolutely, John. And we actually did the same thing in the U.S. business or I should say Daryl and his team did, that we did in the U.K. We used this crisis to rebuild our operations from the ground up, and we're going to be materially more efficient, as you would measure it by SG&A permanently. And the lasting part of this is the efficiency in terms of what we can produce in selling units and servicing cars per head. And I'm quite sure, and we can already confirm it that we'll, on a headcount basis, will be at least 20% more efficient in the U.S. and maybe more than that in the U.K. in terms of the number of cars we can sell per person in the number of cars we can service per person. And that comes from more productive revenue-generating people, technicians and salespeople and less support people. And we've rebuilt that from the ground up, and we can handle volumes that will come back up all the way to pre-COVID levels. So we're very confident in that.

Okay. That's incredibly helpful. And then just lastly, just kind of dovetailing with that is the AcceleRide opportunity, you're kind of alluding to it. It seems like it's sort of an all-hands-on-deck interface with the consumer. But obviously, maybe the bigger opportunities are -- I mean, beyond just typical CRM is the used vehicle opportunity and the parts and service opportunity. And it seems like you are going through strategy or approaching a strategy that is much more, let's use this as the interface to grow the business and leverage our existing bricks-and-mortar where some folks are thinking that they have to go out and build even more bricks-and-mortar along with this interface. So, I'm just curious, as you think about AcceleRide, how much more productive can you make your traditional brick-and-mortar footprint? And would there be any point in time where you might break from this and say, listen, I need to build some used car stand-alone superstores and/or maybe even service base, service op over time.

John, this is Daryl Kenningham. What our customers are demonstrating to us is they love the interface with AcceleRide. And what we're seeing is it provides us the ability to be more productive and faster and more efficient and provide a better customer experience. And it's with that focus that we are moving forward with AcceleRide in our existing footprint. And I believe that's where our focus will be moving forward. Earl may want to add something to that.

And in particular, we've expanded our service capacity significantly in the last decade, and we continue to look for opportunities to do that. But in almost every case, we can do that within our existing facility footprints. And that's not to say we wouldn't build a stand-alone used vehicle operation or service operation if we thought it could provide a good return on our investment. But clearly, we haven't had that belief to date.

The next question will come from Michael Ward with Benchmark.

Just to clarify a few things on AcceleRide. First off, it's been in place for several years. Is that correct?

It's been fully in place, Mike. We've had all of our stores on it for a little over a year now. And we rolled it out for probably a year before that. So probably I would say 2 years now, 2.5 years.

And that's for all across the business model, but it's in scheduling service for several years. Is that right?

We've been scheduling service online for several years, yes. So now our contact center in place for six or seven years, which is a combination of digital and telephonic customer interface.

Okay. And so on the digital side, on the selling a new vehicle, you can basically go through the entire process up until the wet signature?

Yes.

Okay. So that -- so when you think about it going forward, is this a productivity tool that allows you to reduce headcount in the store selling new vehicles? Is that the way to think about from our perspective? So you have the combination what John was talking about there with the used vehicle side, you have the service scheduling, which is clearly more efficient. And then it also can enhance the store profitability. Is that -- am I thinking about it correctly?

We can sell new and used through AcceleRide. And yes, it makes our sales teams more productive, and we see that even today, yes.

Okay. So as we think about just simplistically, SG&A as a percentage of gross, if you've been looking at 74%, historically, we're going down a bit. We're going down under 70%, or we could?

Well, it's hard for me to give you a number, but yes, we're going down. There's no doubt about that. They're just with all the half of that metric being driven by gross profit, volume -- industry volume and margins and such. It's hard to calculate a number, but on the cost end of it, yes, we're going down.

Appreciate it. And John, thank you very much, and good luck with everything.

Thanks, Mike.

The next question will come from Rajat Gupta with JPMorgan.

John, thanks a lot for all the help over the last couple of years and best of luck going forward. Just a set of first question on the omnichannel AcceleRide. The units that you gave us on the slide on the online sales, the 2,700 units, I think, in 2Q, is that a fully online transaction where everything is done online or just curious as to when you define it that way, like what exactly it means? And I'm just curious as to what the unit economics were for those particular units in terms of GPU or just SG&A, et cetera?

Let me start with the economics. This is Daryl Kenningham, Rajat. Let me start with the economics. The gross profits are very similar to our terrestrial sort of vehicle deliveries in front-end and F&I profits. In terms of the SG&A side of it, it's no secret that there's less human involvement in an AcceleRide sale. And we expect that will continue. And as we add more capability to AcceleRide, we expect that to continue. On how many were fully AcceleRide -- our customers, what they have demonstrated to us is they will go in and out of AcceleRide in a true omnichannel fashion very easily. And we've tried to set our tool up to be able to enable that. So if we don't want them to start over, if they decide to come into the dealership to look at two or three different cars in person. We don't want to have to go start the process over digitally. And we want them to be able to pick up where they left off. So some customers will go online and get a payment that they like and select a car, come in and test drive it and then maybe get us to value their trade there, then they may go back online and do upload their insurance information, upload their driver's license and finalize things. So what we've tried to focus on is enabling customers to be able to do it how they want to do it and what our customers are telling us is they like going in and out of AcceleRide. And we have the same capabilities that our Carvana does or CarMax does with our digital retailing tool, and we'll continue to offer that.

Got it. That's helpful. And any update on how you're seeing trends here early in the quarter, just across the different business lines, both in the U.S. and U.K? And U.S. specifically, I mean how is Texas evolving here versus the June trends that you have seen into July? And just what your expectations are more like in the near-term then into August and into the fall?

Yes, this is Earl. I'll let Daryl add what he would like here in a moment. But the trend into July is very much as it was in June, which is quite strong in both the U.S. and the U.K. markets. In fact, I would say the U.K. market is gaining strength particularly in used vehicles and service. Obviously, there was more pent-up demand in the U.K. because the closure period, and they were very, very complete closure periods were much longer in the U.K. New vehicles clearly can't snap back so much in the U.K. because so many of the vehicles have to be produced at the factory. There's not big inventories kept at dealerships and such. The U.S., we're also continuing to see that strong momentum from June, but probably with a little more headwind from inventory shortages. And let me let Daryl kind of pick up there.

Yes, that's exactly right. And we are seeing a bit of an inventory strain in new and used and especially on the new side with some hot models that are typically our volume sellers. And in after sales, we're seeing a good July will continue like June did and with a shot at our customer paving up again. So that's what we're seeing.

Got it. And then just to follow up on the SG&A question. Just to ask you differently. I mean you talked about 200 to 300 basis points per introduction in the U.S. U.K. demand has been pretty weak there for like almost a couple of years now. So it looks like a lot of pent-up demand in the region, you've taken out a lot of costs during that period. So just asking a different way, like if you're back to a similar level of gross profit for the company, say, what you had in 2019, mean how much lower could be SG&A to gross be? I mean, I think you finished 2019 at around 73.9%. So is it fair to assume that, that number is probably sub 70, at that kind of gross profit level? Or just wondering how to think about this as we model our 2021, 2022, after that?

Yes. Well, I there's too many variables these days to give you that number, but I do think you know that headcount is -- personnel expenses are generally about 60% of our total cost. And we expect to be at least 20% more efficient in that area. I would also expect there'll be some marketing efficiencies as we continue to develop and move more into non-traditional media and digital media.

And our next question will come from Rick Nelson with Stephens.

My congratulations to John. He's been awesome over the last 15 years, and wish him all the best. So I like to follow-up on the supply constraints that Daryl had talked about when you think those are going to start to ease and how long you think you're going to be able to hang on to these GPUs?

Earl -- I'm sorry, Rick, on the new car side, I believe we'll start to see them ease towards the end of this quarter. And then I think in the fourth quarter, we'll start to see more normal inventories through the end of the quarter, probably. On the used side, I would expect that we'll be able to -- the pricing environment is driving a lot of that right now. And I expect that, that will probably normalize a bit over the next 90 days or so, 60 to 90 days. And that's what we're seeing anyway based on our acquisitions and trading.

Great. So dealers are talking about a big step change in profitability in June. Curious if you could talk about the total contribution to the quarter that you saw in June from a full quarter profit standpoint or maybe SG&A, what the exit rate was in June from a SG&A standpoint?

Yes. Rick, this is John Rickel. I don't want to get into kind of month-by-month details because we've never done that. But clearly, June was the best of the 3 months. And the exit rate on SG&A as a percent of gross was better than what we averaged for the quarter. Kind of makes sense. I mean, April was shut down and pretty weak. So the combination of really strong margins in June and the cost reductions meant that June was kind of the best month of the quarter, and SG&A definitely exited at a lower rate than the average for the quarter.

And I think I can make one statement, Rick, that again reinforces the business model. And you know that we never lost money on an operating basis in '08 and '09 in terms of a quarter. But actually, even in this quarter, where April was pretty much a disaster with the U.K., completely shut down in U.S. volume down 50%. We didn't even lose money in April as a company. So we were even able to overcome a pretty significant U.K. loss with a U.S. strength, which is because we cut costs abruptly in the last week of March.

That's great color. Also some parts. You discussed some of the sequential trends there. It sounds like things are getting better. Any reason why we shouldn't be able to get back on that mid- single-digit comp growth in that segment?

In the near term, Rick, the drags on that part of the business are warranty, which has to do with, to some degree, whether people are comfortable coming out for elect things like recalls. But also our collision business, there's just been people driving less mileage. And so our collision business, which isn't a massive part of our business overall. But it's probably the weakest when you look at it year-over-year. As Daryl mentioned, the customer pay business is pretty much back to previous levels. I don't know if you want to add anything?

I think that's right. I think the things that as markets open more and miles driven goes up, the service business will come back to a degree. And the age of the car park is like the oldest it's ever been, which is generally good for service business.

Our next question will come from Armintas Sinkevicius with Morgan Stanley.

And as everyone else, congratulations to you, John, it's been a pleasure. I guess we -- it's hard to know what the rest of the year looks like, but the flavor of the day seems to be five year targets. So maybe you can talk about how you envision the business looking in five years, touch on capital allocation and your outlook for digital, the U.K., Brazil, et cetera.

So yes, let me start, Armin, this is John. I mean, clearly, we think there will continue to be opportunities to grow through acquisition. We have always shied away from putting a specific number out there because if we give the acquisition team a specific target, they can go get the target. But you want to make sure that you're getting appropriate returns on invested capital and you're buying the right assets. So we want to continue to be opportunistic. Clearly, the balance sheet is in great shape, the cash levels. So we're positioned, but we're going to be disciplined about it. We're going to look for good opportunities that offer appropriate returns on capital instead of just trying to hit arbitrary numbers that are thrown out there to get the Wall street investors excited. So that will be -- I think still the longer-term plan is we think there are plenty of opportunities to grow through acquisition. If you look at what we've done with the scale, right, that it really does matter, whether it's the ability to do AcceleRide, whether it's our inbound service call center, whether it's the back office efficiencies that we have in place. It's getting tougher and tougher for smaller independent dealers to be competitive in a world where the omnichannel and scale really matters so much. So we do think if we're disciplined and patient, there will be opportunities to grow and grow significantly, but we're going to do it in a way that makes sense for the shareholders and for return on invested capital.

And this is Daryl. In terms of digital, we'll certainly be more digital five years from now. And in addition to things like AcceleRide and online service scheduling and online bill pay and things like that. Artificial intelligence, we're starting to work with that in our call centers and with some of our back-end support with our websites and things like that. So all of that will become more a bigger part of who we are, and we will look for ways to continue that trend. And if it helps customers, it helps us lower our cost, we will certainly take advantage of it. It's hard to say exactly where that will be in 5 years, but I will certainly bet that it's a much bigger part of who we are.

Armin, the other thing that I would add as well is we will continue to be focused on parts and service. That organic part of the business has been key to the model. We've done a fabulous job. We've got great leadership in that area. The stuff that we've done on our 4-day work week, the inbound service call center. There just continues to be huge amounts of opportunities in parts and service. So that will continue to be our internal focus for growing the organic part of the business.

Okay. Great. At the next question will come from David Whiston with Morningstar.

And John, congratulations on a great career. First question is on AcceleRide and home delivery. Just overall, how many customers are doing home delivery and do AcceleRide customers still prefer to come into the store at the end of the process? Or do they want home delivery?

Most prefer coming into the store, David. We were up to about 20% at 1 point during the quarter. We give that option to everybody. And we'll still prefer to come into the store.

The home delivery than was 20%, is that what you meant?

At one point, during the quarter, yes.

And in Brazil, I hear the automakers are talking about how they need to and are able to put price increases through because of the foreign currency headwinds they have. You guys are on the ground with the consumer there though. Can the Brazilian consumer absorb these price increases?

Yes, we've heard from the OEMs on that issue, and it all depends on how much the price increases are. The Brazilian market is smaller today than it was a few years ago So massive price increases won't help. Well, historically, we've seen a lot of price increases because of the deterioration of the Real versus Euro, Dollar, Yen, whatever in the last 4 or 5 years. And it doesn't impact Honda, Toyota, which are our volume businesses because they now make most of their vehicles there. They're very localized now. The prices go up on BMW and Land Rover quite a bit, but the upper income customer who buys those cars seems less impacted by increases in prices on luxury goods like that. So I'm sure another round is coming, but it hasn't been a material headwind there. The spread of the virus has been the big issue there in the last month or 2.

Okay. That's helpful. And then finally, I was just curious if you heard any early feedback from your Texas and Oklahoma customers on the next-generation F-150?

F-150 and the new Bronco is a hit it is going to be an absolute home run.

This concludes our question-and-answer session. I would like to turn the conference back over to Earl Hesterberg for any closing remarks. Please go ahead, sir.

Thanks to everyone for joining us today. We look forward to updating you on our third quarter earnings call in October.

The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.