Good morning, and welcome to the Plexus Corp. Conference Call regarding its Fiscal First Quarter 2024 Earnings Announcement. My name is Livia, and I will be your operator for today's call. At this time, all participants are in a listen-only mode. After a brief discussion by management, we will open the conference call for questions. The conference call is scheduled to approximately one hour. Please note that, this conference call is being recorded. I would now like to turn the call over to Mr. Shawn Harrison, Plexus Vice President of Investor Relations.

Thank you, Livia. Good morning everyone, and thank you for joining us today. Some of the statements made and information provided during our call today will be forward-looking statements, including without limitation, those regarding revenue, gross margin, selling and administrative expense, operating margin, other income and expense, taxes, cash cycle, capital allocation and future business outlook. Forward-looking statements are not guarantees, since there are inherent difficulties in predicting future results and actual results could differ materially from those expressed or implied in the forward-looking statements. For a list of factors that could cause actual results to differ materially from those discussed, please refer to the company's periodic SEC filings, particularly the risk factors in our Form 10-K filing for the fiscal year ended September 30, 2023, and the safe harbor and fair disclosure statement in our press release. We encourage participants on the call this morning to access the live webcast and supporting materials at Plexus' website at www.plexus.com, clicking on Investors at the top of that page. Joining me today are Todd Kelsey, Chief Executive Officer; Steve Frisch, President and Chief Strategy Officer; Pat Jermain, Executive Vice President and Chief Financial Officer; and Oliver Mihm, Executive Vice President and Chief Operating Officer. With today's earnings calls, Todd will provide summary comments before turning the call over to Oliver and Pat for further details. Let me now turn the call over to Todd Kelsey. Todd?

Thank you, Shawn. Good morning everyone. Please advance to Slide 3. There were many positives during our fiscal first quarter. These included strong quarterly wins across our market sectors, totaling $261 million, including the addition of two new exciting healthcare life sciences logos. Robust expansion of our funnel of qualified manufacturing opportunities, which now exceeds $4 billion. When combined with a total available market exceeding $240 billion, this supports our expectation of continued industry leading revenue growth with a targeted CAGR of 9% to 12%. Ongoing advancement of our sustainable and responsible business practices, along with numerous efforts by our team members to help create a better world and positively impact our communities. Yet the quarter had its challenges, primarily associated with further demand softening in the Healthcare/Life Sciences sector and certain subsectors of the industrial market. The resulting revenue decline has created inefficiencies across our organization, which we are addressing as we remain focused on delivering 5.5% GAAP operating margin in fiscal 2025. These actions will be discussed in more detail later in the call. Please advance to Slide 4 for a review of our fiscal first quarter results. We delivered fiscal first quarter revenue of $983 million, GAAP operating margin of 4.6%, including 54 basis points of stock-based compensation expense, and GAAP EPS of $1.04, including $0.19 of stock-based compensation expense. These results met the updated guidance provided on January 16, 2024 and reflected the impact of significant negative operating leverage as demand weakened late during the fiscal first quarter, limiting our ability to appropriately adjust expenses. Please advance to Slide 5. Our go-to-market organization is leveraging the current environment to create significant opportunity for future growth. We won 30 new manufacturing programs worth $261 million annually when fully ramped into production, led by continued strength from our…

Thank you, Todd. Good morning. I will begin with a review of the fiscal first quarter performance of each of our market sectors, our expectations for each sector for the fiscal second quarter and some directional sector commentary for fiscal 2024. I will also review the annualized revenue contribution of our wins performance for each market sector in the region, and then provide an overview of our funnel of qualified manufacturing opportunities. Starting with the industrial sector on Slide 9, revenue increased 4% sequentially in the fiscal first quarter. This result was below our expectation of a high-single-digit increase. Softer end market demand across some market sub-sectors contributed to the weaker result. As we start the fiscal second quarter, we are experiencing forecast lightness as customers burned down inventory, most notably within the communications sub-sector offset in part by strength in green energy and an incremental increase in SemiCap. This will result in a low-single-digit decline for the industrial sector for the fiscal second quarter. Industrial market sector had strong wins in the fiscal first quarter of $125 million. Wins were balanced across our sub-sectors including SemiCap. New programs include a follow on commercial vehicle charging platform that will be produced in our Appleton, Wisconsin facility. We also expanded our portfolio with the newer SemiCap customer to include engagement from the Americas region with a complex mechanical assembly that will be produced in our Guadalajara, Mexico campus, we are now engaged with this customer from all three of our regions. One additional highlight from the quarter is an assessment that our engineering team is performing on a product that our customer is currently designing, called a lifecycle assessment, these high value add engagements examine and measure the environmental impact of a product throughout its lifecycle. By identifying improvement opportunities early…

Thank you, Oliver, and good morning, everyone. Our fiscal first quarter results, I summarized on Slide 14. With revenue below our original guidance, gross margin of 9% came in slightly lower than expected. Reduced fixed cost leverage and unfavorable mix led to the gross margin result. Selling and administrative expense of $43 million was within our guidance range. As a percentage of revenue, SG&A was 4.4%, which was slightly above expectations given the late quarter decline in demand. GAAP operating margin of 4.6% was below our original guidance due to the loss of leverage within gross margin and SG&A expenses. Non-operating expenses of $10.3 million were consistent with expectations. GAAP diluted EPS of $1.04 was below the original guidance due to the factors previously mentioned along with a slightly unfavorable tax rate. While we continue to measure our performance against GAAP metrics, next quarter we will begin sharing non-GAAP operating margin and EPS exclusive of stock-based compensation expense for easier comparability to peers. Turning to our cash flow and balance sheet on Slide 15. We used $3 million of cash to support our operations and spent $29 million on capital expenditures, resulting in negative free cash flow of $32 million for the fiscal Q1. This result was favorable to initial expectations as we intentionally delayed a portion of capital spending to more evenly spread-out cash payments throughout fiscal 2024. With the fiscal first quarter typically requiring investments within operations, we did not repurchase any of our stock under the existing authorization. However, as announced last week, our Board approved a new $50 million share repurchase authorization, bringing the total available amount to approximately $56 million. Starting next week, we plan to begin purchasing shares under these authorizations, while taking market conditions into consideration. We plan to fund investments in operations…

[Operator Instructions] And our first question coming from the line of David Williams with The Benchmark Company.

So a lot to get through here, but just I guess firstly, if you kind of think about the softness in the Industrial segment, which isn't really surprising. But can you kind of give us a sense of how your customers' tone has been and kind of partially maybe the inventory versus the demand side and how much of this is the burn down versus just more cautious outlook in the future quarters?

Yes. So, I think I will start David and talk a bit about our different markets and what we're seeing and then pass it off to the rest of the team to talk about inventory as it relates to demand. It's really interesting our markets. There's a bit of, I would call it a rolling progression across our markets post pandemic and stimulus as to when they've shown strength and when they've shown weakness. And so it varies a lot by sector. So, if you look at Aerospace and Defense, which I'd say is the furthest along, had lots of struggles post pandemic is very much in a boom cycle right now and performing incredibly well. As Oliver had mentioned, we're coming off a high-teens growth year and we expect to do better than that in fiscal '24. So, it's really strong growth supported by a strong funnel. If you transition over to industrial, there's a couple of different spaces within industrial that need to be considered, the first being SemiCap. And of course, we saw SemiCap drop precipitously a little over a year ago. It's hit the bottom in our Q4 of fiscal '23 and is on -- I would call it a climb upwards, although very modest at this point and a lot of it driven by share gain. So, we're seeing growth there, but some of the other markets in industrial are struggling right now, particularly the communications. And that's where we're seeing the biggest near-term headwind. Now we believe that to be a transitory situation as new technology is worked into the market. And then finally, there's Healthcare/Life Sciences. And I'd say again, we view this as transitory too, but we must say the down cycle has been a lot and that's right in the down cycle. Now, we would have to say that's a lot deeper than we've historically witnessed within our Healthcare/Life Sciences space. And there's a few reasons why that's occurring, one is that the inventory corrections as certain device making OEMs have overshot their demand. There is also the impact of components that were purchased last year at above market prices that are back to more normalized levels this year, that's having an impact as well. Also some delays in program ramps, as a result of customer design issues or supply chain, supplier issues, I would say on those components. It's very different by market, but right now, because of the near-term impact in both healthcare and communications that's having an outsized impact on our business. I will pass it over to…

Sure. I mean specific to the industrial sector, because I think that's where we started, right? We do see some general inventory burden down. But as Todd noted, it's really focused on the communications sub-sector and as we look across the rest of that sector, there is I think I'd say signs for optimism. I think we see some incremental improvement here ahead of us in test and measurement. We have got some nice tailwind in green energy, although admittedly that's coming off of a smaller base, but that provides a bit of a tailwind. And then Todd also mentioned our SemiCap sub-sector. One additional data point I will note there is, if we look at our F'24 outlook for SemiCap, that held flat quarter-over-quarter. So I think another data point that suggests signs for optimism in that sub-sector.

Great. Thanks for the color there. And then maybe secondly on the restructuring and you think about some of the reductions that you are making. How do you think about that in terms of the second half rebound? And just maybe, if you could walk through some of the changes or the restructurings that you are making, where those are and what we should expect in terms of demand, excuse me, of impact to the your capabilities? Thank you.

I mean, I want to start David by saying that, we don't take actions like this lightly, given the impact on our team members and the communities that we are a part of. But we do have and we have talked about having a playbook to protect our profitability. So we want to ensure that we are positioning ourselves for this 5.5% GAAP operating margin target that we have and we believe that's what we are doing. So what we're doing is, we are taking a look at areas where we can enable better scalability, create greater efficiencies, align our cost structures to position us for future investments. So that primarily involved, I'd call it, rightsizing capacity and mostly across our operations, it hit manufacturing, services and engineering. We talked about engineering being light due to healthcare, that's having a pretty substantial drag on our operating margin performance, given the ratio of cost the essence that, the cost within engineering is relatively fixed. So we think we are putting in place opportunities to better position our company for the future as we go forward on this. When we talked about, what it does to the second half and the second half rebound, as I mentioned in the prepared scripts, we look at it as being about a $20 million annualized cost savings or about $5 million per quarter. So you can think of it as, once we get these fully implemented and moving forward somewhere in the order of 50 basis point impact.

Our next question coming from the line of Melissa Fairbanks with Raymond James.

First of all, I just wanted to say, thanks for giving us a framework for the full year revenue -- segment revenue its super helpful. So, to start, I've got a quick one for Oliver. I pretty much ask the same question every quarter. Could we get an update on the lead times? Last quarter, I think you noted even though lead times were coming down, they were still running at about twice the normal range. Have we gotten any closer to normalization there?

Yes. Thanks, Melissa. Happy to answer that. So, similar to the message from last quarter, commodities are broadly showing stability. I think when we talked about this last quarter, we said that as you noted just over six months, we've moved from essentially 23 weeks to 22 weeks across our broader commodity base, so just an incremental improvement there. As I reflect on the whole dynamic for us, I'll say that our shortages and the challenge spots are less semiconductor focused. So, a couple of quarters ago that was really just in the semiconductor slice of our supply chain and now includes an element of passes as well. So, that I view that as a further step towards normalization. Within semiconductor, we came from 200 days down to 188 days. So, just running a bit over six months. And then within semiconductor, as we've talked about historically, still see and high-end semiconductor with lagging edge technology, we still see tight inventory and the occasional unexpected de commit and then generally no stock on the open market to help address that.

So, I just wanted to follow-up on the last question, about the restructuring actions you're taking. Maybe a little bit less delicately. So, Todd, I think you explained that there's some consolidation or optimization across from your facilities. Is there a factor or is there business you expected to win and had capacity dedicated to it, but now maybe that's no longer an opportunity so you're resizing some of those businesses?

No, there's really none of that Melissa. It's really more of a softening in markets that we're seeing. No, as we talked about in engineering, we're seeing some delays in decision-making and such, which is causing us to pause there. But when we look at manufacturing or services, it's just general market softening and it really relates primarily to our Healthcare/Life Sciences market sector.

And our next question coming from the line of Matt Sheerin with Stifel.

Just a few questions from me. One, just in terms of top-line and your expectations for sequential growth in the subsequent quarters in the back half of '24. I guess the question is, has your visibility improved or confidence improved given that looking at the last six quarters or so. I think there's at least three quarters where, there had been top-line issues or headwinds in the quarter for various reasons, right? So, I guess the question is, has that confidence or visibility improved and how?

Yes. So, Steve is going to take this question Matt.

I think as Todd talked about in terms of kind of seeing these rolling changes coming through the different sectors, I think it kind of follows that same philosophy where our confidence in the future forecast, it really kind of varies a bit by sector and sub-sector. So specifically like Aerospace and Defense, much more confident in what we're seeing from the Aerospace and Defense customers in terms of what their demand looks like as well as our confidence in supply chain. So as Oliver kind of gave a little bit of guidance there, I'd say, we have more comfort level there. And we see, as Todd highlighted in the industrial sector, stabilization in the SemiCap market. As we are starting to talk to customers about their back half 2024 forecasted into 2025, gaining confidence that those things will come to reality and basically working with them to make sure we can achieve that. A little bit of volatility like the communication sector, Todd talked about. We have seen a few surprises there, but more focused on technology changes and a little bit of shift there. Obviously, going through this Healthcare/Life Sciences challenge now again ultimate long-term look very confident. If you look at where the wins are at in the funnel, which is indicative of our customers are really kind of trying to reevaluate, what their sourcing strategies are. We did have a few customers come out and announce their plans to close facilities and consolidate for us. That's a good thing. We talked about our funnel increasing. Those larger increases are coming from opportunities like that. So there may be a little bit of volatility here in this quarter in terms of where we are seeing those forecast, but as we look to the future, we expect those inventory corrections kind of burn through real potential for those sub-sectors to take off.

Steve, in terms of that inventory burn at customers in those sectors you discussed, are you getting, do you have a sense from customers or how long that's going to take? And in terms of like forward orders, are you seeing signs, I don't know it's 8 to 12 weeks out that things are improving?

Yes. We are looking at it customer-by-customer and actually product-by-product and it does vary. Some products for example the things that supported COVID, some of the laboratory test equipment. Their inventory levels are a bit higher and will take a little bit longer to burn through. Other things more related to surgical platforms or other related elective procedures. We are feeling more confident those will rebound more quickly. We are going through the analysis kind of product-by-product and it does vary a bit. But again our confidence level, it will come back. It's not really a product issue, it's just really more of an inventory problem.

One of the things I'd add to Mike or Matt is, when we look at the at our outlook and outlook for the back half of the year, and we are taking it from a very conservative point of view, but we have a number of program ramps that are well underway that are going to continue to provide additional revenue in the back half of the year. We have got the supply chain improvement that Oliver talked about and that leads right into the unfulfilled demand that we still have out there. So looking at this conservatively, we have confidence that, we are going to see the sequential improvement that I talked about. One other revenue component -- related component that I just want to hit on quickly, as I want to correct a statement that I made in the prepared remarks. And when I talked about our growth rate, I talked about us having an 8% CAGR over our last five fiscal years, which is accurate, but that is a 250 basis point spread above the industry average, so not the '25 that I had mentioned earlier.

Just on the communication side, could you remind us, like what the sub-sectors or industries, because I know you don't play in mobile networks or base stations anymore, right? It's mostly in other areas.

Yes. It's really broad brand infrastructure that we are talking about there, Matt.

And that weakness are you seeing across, your vendor base or customer base?

Yes. I will note that, we are well-represented in that technology space. And so as there is an expected technology upgrade here in the future and so when that does manifest, we're going to enjoy the growth as part of that.

And just a couple of quick questions for Pat, if I can. One, Pat, in terms of your expectations for margin expansion in the back half of '24, and obviously, gross margins should expand. But in terms of SG&A, you talked about some near-term expenses, but does that go down in Q3 or because of IT costs and others, is that going to be at those elevated levels?

Yes, I think we will see improvement in the percentage as we get to the back half of the year. The dollars, I think we'll stay relatively consistent, Matt. So, from a percentage standpoint, what I'm guiding Q2 at is about 4.9% of revenue and that is up from Q1. There's really three main components to that. The seasonal compensation cost increases is about $1.5 million. We have got some higher stock-based compensation based on the roll-off of some prior awards. And then as I mentioned some IT system related investments and a host of things we're doing there around collaboration tools, cyber security, upgrade to manufacturing systems. So, that's driving the dollar increase and I do think that will stay pretty consistent throughout the rest of the year. But from a percentage standpoint, where we're targeting is around 4.5% of revenue. So, some leverage improvement as we see top-line growth in the back half of the year.

And our next question coming from the line of Anja Soderstrom with Sidoti.

First of all, Pat, did you mention that you expect the CapEx to come down for the year than your prior projected?

Yes. Previously we had $110 million to $130 million. So, we brought it down $10 million and some of that's just because of growth investments that are being delayed a bit. We're being really mindful and prudent about the capital spending this year.

And in terms of the funnel, have you mentioned larger opportunities there coming in? And can you talk about how they relate to previous opportunities?

Yes. So, we are still seeing a larger number of large opportunities in our funnel than we had seen historically.

So, does that impose bigger risk then in case you don't win this larger opportunities?

No, I think it actually creates more opportunity for us to have strong wins performance because of that.

It's Shawn. Just as maybe a little bit of clarification. When we go head-to-head on a program versus competitors, on average, we're winning two-thirds of the time. And so our win ratio when we go into this qualified funnel of opportunities is quite high, whether that's a small program or one of these larger programs.

And also lastly, the issues that had with some airplanes lately and Boeing having some issues. Is that any risk to you at all or?

Yes. So, the answer from a risk standpoint is no. We do supply Boeing and we have, I would call it a reasonable, we don't supply Boeing directly, but we do supply into Boeing and we do have content on the 737 and the 737 MAX. But – and I saw today that, the FAA announced that they're going to allow Boeing to go back into production at the rate that they have been at historically, so that would have minimal impact to us. But even if production had been shut down, it'd be of, I'd call it, a negligible impact to our overall revenue. So it's pretty insignificant to us.

Thank you. You also mentioned, communication seems to be a headwind for you now. But what are you hearing there in terms of the tone and when that could potentially come back?

Yes. I will offer this, as we went into a quarter ago, we thought that that technology upgrade and the bounce back there was going to be early to mid '24. So we are now taking a more conservative view as it being a little bit further out, but the exact timeframe, I hesitate to call the ball for that.

Our next question coming from the line of Jim Ricchiuti with Needham and Company.

Just wanted to go back to some of the commentary on the market sectors. If we look at where their biggest wildcards are in terms of the improvement that you are anticipating in the fiscal second half. Would you say, it's more on the Healthcare/Life Science portion of the business?

I would say, Jim, we are not looking at the markets improving to get the recovery or the growth in revenue that we're projecting. It's more based off of program ramps and activity that's already underway. So any market improvement, whether that come from healthcare or further increase in SemiCap demand would be upside to what our projections are.

And I guess, Todd, the way of thinking about it is, if there is some potential for negative surprises, where you don't necessarily see progress overall in the second half. Which sector might carry the biggest risk? That's why I was asking the question.

I mean, it would probably have to think about industrial as further degradation of healthcare, but it seems that, that's come down a pretty tremendous amount already that, it should be at a bottom are close to it.

On the A&D side, seemed to be suggesting that, even with there's been a little bit of it sounds like some program activity slipping on the defense space side, you still seem pretty confident that, that shows healthy growth for the year as a whole, with the continued growth that you are seeing in commercial air. Is that fair to say?

That is fair to say. Specifically to hit that defense and space headwinds that I mentioned that we are experiencing in Q2, that is a short-term headwind, so that's nothing systemic that we are talking about there. As an example, with one of the program ramps we are doing is actually a bit of a good story here. We were doing printed circuit board assemblies for a customer and we are performing so well on the ramp and say, ''We want you to do the whole higher level assembly. And so we took a pause where we could take over the rest of that business as well''. So temporary headwinds and we do not expect that to persist. Then, as we talked about previously, strong underlying commercial aerospace demand.

One of the things too I'd add, Jim, on our Aerospace and Defense sector, we break it down into four subsectors, Aerospace, Defense, Commercial Space and Security. And all of them are showing reasonable year-over-year growth in fiscal 2024.

And then finally, you talk about the 5.5% GAAP operating margin in fiscal '25 and that you're committed to protecting that. Does that require if we see in the past, you've talked about $5 billion of revenue? It sounds like you're suggesting, you get to those targets even with the restructuring and the cost actions you're doing, even if revenues are not at that level, is that, or am I misinterpreting what you said?

No, I don't think you are, Jim. I mean, what we'd like to get to the $5 billion in revenue, but obviously with current dynamics and the current results and guide that would take a pretty substantial market improvement to be able to do that. But we can control the operating performance and the operating margin. That's part of the reason for us looking at the restructuring actions as well as some other activities is we believe that that's a level of performance that we need to deliver.

But basically from the actions you're taking, you don't necessarily anticipate anything additional that you have to consider to get, given the current state of the businesses?

No, we don't believe so. I mean, obviously, we'll need to get some additional revenue growth, so we get leverage. It really comes down to the restructuring actions, better utilization within our engineering team and then some manufacturing leverage.

And I see we have a follow-up question from David Williams from Benchmark.

First, I missed this earlier, but I want to say congratulations to Pat on the CFO of the year, it's certainly well-deserved and I think we would all agree to that. So, congratulations there.

Thanks, David.

Yes, of course. And then secondly, just want to ask real quickly on the previous unverified list addition that you guys were [indiscernible] on. Was there any impact from that and anything longer term we should think about here, any further risk or just any color around that would be helpful I think?

Yes. So, we've been able to recover through, I'd call it a heroic efforts from our supply chain team and our APAC team in the region. So, we don't believe there'll be any impact to our fiscal Q2, although it wasn't easy. But what I would say is that the addition to the list wasn't merited, excuse me. It reflected more of a communications issue and a delay in a routine verification of a shipment to our Xiamen facility. The quick removal from the list, which I think was probably like record speed, reflects these facts. So, I would like to call out though the Bureau of Industry and Security within the Department of Commerce and their strong partnership on this to resolve this. So, was very happy with the response that we were able to get. And I'd just like to reiterate, we have a strong compliance program and we remain committed to all laws as well as a strong partnership with the BIAF. So, nothing additional and we're happy that this is behind us.

Nice work getting that clear quickly. And then just secondly, regionally, it looks like Americas was down quite a bit. Is there anything specific maybe to that area? Is it fair to assume that maybe the more heavily-leveraged to the healthcare industry or anything maybe just around Americas that drove the sequential and year-over-year decline?

Yes. And so I think you have already hit it there, David. I think as we look at the Americas region and the exposure relative to Healthcare/Life Sciences as well as the communication sub-sector is creating that result. And as those sectors come back, we will see the Americas region come back with that.

We have a follow-up from Matt Sheerin with Stifel.

Thank you. My follow-up is on the inventory situation. Pat, you talked about the total inventory days at 161. I know, but I didn't get the percentage or the number of days backed by customer deposits. Could you give us that number? And you also mentioned you expected those deposits to come down, as customers want their cash back, given lead times are getting back to more normal? So what does that percentage look like and how does that impact your cash flows over the next few quarters, as that percentage comes down?

Matt that's a really good point, because we do have to look at it on a net basis, because I expect significant reduction in gross inventory dollars year-over-year. It could be upwards of $100 million. But we will see a significant portion of the advance payments being returned as well as we burn down that inventory. So to give you just some examples of what happened from a day’s perspective, from Q4 to Q1 days of customer deposits came down too. We would expect that coming down quite a bit in the back half of this year. So when you look at it on a net-net basis, our cash cycle, we ended at 87 days in fiscal 2023. I expect improvement in '24, probably in the low-80s on a net-net basis. So much greater reduction in inventory, but also a reduction in the advance payments as well.

Got it. But as a percentage, do you expect those advance payments to come down?

As a percentage of gross revenue or inventory? Yes. Let me just do some...

Now it's what over 30%, right?

Right. It would be still probably similar to that by the end of fiscal 2024. Again our goal is to return those upon liquidating the inventory so it would probably be around that low 30% range.

It's not going to change. It's just the growth. The number is going to change, which is lower.

Both dollars will reduce.

Got it. Okay. That's it for me. Thank you.

Thank you. And that concludes our Q&A session. I will now turn the call back over to Mr. Todd Kelsey for any closing remarks.

All right. Thank you, Livia. I'd like to thank our shareholders, investors, analysts, as well as our Plexus team members that joined the call this morning. In closing, I want to say that, as I look forward, I remain very confident in our future. And it's our exceptional Plexus team that provides the basis for this view. They continue to differentiate Plexus in the market and with our customers where we're the leaders in the markets featuring highly complex products and demanding regulatory environments. When we look at this differentiated performance and couple it with the strategically aligned large available markets in which we participate in our commitment to delivering superior operating results, I'm optimistic that we'll continue to outgrow our industry and deliver the strong returns our shareholders expect. Thank you all, and have a great day.

Ladies and gentlemen, that does conclude conference for today. Thank you for your participation. You may now disconnect.