Good afternoon, and welcome to the Sonoma Fiscal Third Quarter 2018 Conference Call. My name is Amanda, and I'll be your coordinator for today's call. At this time, all participants are in a listen-only mode. At the end of the call, we will be holding a question-and-answer session with company management. As a reminder, this call is being recorded for replay purposes. I will now turn the call over to Mr. Jim Schutz. Please proceed, sir.

Thank you, Amanda, and good afternoon, everyone. With me on the call today are Bob Miller, Sonoma's Chief Financial Officer; and Marc Umscheid, our Chief Strategy and Growth Officer. Dan McFadden, our Vice President of Animal Health and Investor Relations, who is normally with us on these calls, is travelling. And apologies for the scratchy throat, I've been a bug for the last several days. For today's call I'll review the key financials from our quarter ending December 31, 2017; spend a few minutes on our fastest selling product this last quarter, Ceramax; and then finally look ahead to several upcoming milestones. Bob will follow with a thorough discussion of our financial results for the quarter and our three-year track record in the prescription dermatology market. We'll then open the call up for Q&A. Before we start, let me remind you that today's discussion contains forward-looking statements within the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 that involve risks and uncertainties that could cause our actual results to differ materially from those discussed in today's call, including risks inherent in the development and commercialization of potential products; our ability to become profitable; the progress and timing of our development programs and the regulatory approvals for our products; the benefits and effectiveness of our products; the ability of our products to meet existing or future regulatory standards; our expectations related to the use of our cash reserves; our future capital needs and our ability to obtain additional funding; and other risks detailed from time to time in our filings with the Securities and Exchange Commission, including our annual and quarterly reports. These forward-looking statements are identified by use of such words such as expect, to expand, would and anticipate, among others. Identified product applications and/or uses…

Okay. Thank you, Jim. Over the next 10-plus minutes, I will discuss the financial results of the quarter ended December 31, 2017 compared to the same period last year and last quarter, and our three-year financial track record in dermatology updated for the recent December quarter. Looking at the financial results, I will cover the high-level results for the key financial metrics for the quarter ended December 31, which includes the revenue, cash operating expenses, EBITDA and cash position. More details of these results are discussed in the press release and the upcoming 10-Q. Even though we will mention the results for the overall company, we will focus on the results and the growth of the dermatology prescription business, since this is a business which will be driving - driving us to profitability. As Jim mentioned earlier, we have distributed a PowerPoint presentation in PDF form as a supplement to the earnings call. Looking on Slide 7, there is a table showing the results of the key metrics of the December quarter 2017, compared to not only December quarter last year, but also the September 30, 2017 quarter. Some of these key metrics are the following, some of which Jim already discussed. Total product net revenue for the December quarter was $4.6 million, up $1.5 million or 47% from the same period last year and up 12% compared to the September quarter. This growth was driven mostly by strong increases in the revenue in Latin America and the United States, partially offset by a decline in Asia and the Middle East. However, this is our highest product revenue in the history of Sonoma and Oculus. U.S. product net revenue was $2.9 million, up $1.2 million or 73% from the same period last year, representing 62% of our total product revenue…

Thank you. [Operator Instructions] And your first question is from the line of Jason Kolbert of Maxim. Your line is open.

Hi, guys. Congratulations. Really, I can see the intrinsic growth. What I really like is the sequential comparison to revenues that you reported in 2Q 2018, $4.3 million versus current quarter at $4.8 million. The one area that I'd like to focus on and you almost answered the question in your remarks, you talked about margin. And I really want to understand how margins are going to change going forward. It seems to me that margin is going to be one of the keys towards breakeven. And very specifically - listen, I agree with the idea of adding sales reps as long as they're accretive, but you also had a pretty high SG&A number this quarter at $5.2 million. How should we be thinking about SG&A going forward? How should we be thinking about margins going forward? And then, help us understand kind of the margins as we look at the product profiles from Alevicyn, Celacyn, Mondoxyne, Ceramax, SebuDerm, Loyon. But, how should we be looking at that product mix in order to kind of figure out how the margins may shift in the quarters ahead? Thank you.

Okay. That's quite a few number of questions. Let me see - let me handle the operating expense number first. We should - as I mentioned, we should be in the range. And I'm talking about cash operating expenses, which is operating expenses, mostly deducting the cash compensation expense. And we should be ranging in the $4.3 million to $4.6 million, other than the June quarter which we - where we have our accounting charge, which is another 200,000 or 300,000. And that's, now, we were a little above that this quarter. We had some onetime expenses that actually got moved from one quarter of the other that increased the size of this quarter and was - we don't think that - we think it should be dropping back into $4.3 million, $4.6 million level range. So that's the operating expenses. In terms of gross margin, it's - we have an interesting mix of businesses that have - with very wide range of gross margins. We have our Mexico business, where we only have a 6% profitability number, because it's a business we sold to them. And we agreed to make product to them until they can make it for themselves for a very tiny margin. We also have other international businesses, which tend to be in the 30% to 50% gross margin range, and then we have the U.S. businesses. Most of them are in the 80%-plus. Some of them are a little bit less, but 80% mostly, in acute care and the prescription business. So what's going to happen over time is that 6% margin is going to disappear sometime next year as we mentioned, we think probably later in the fiscal year. And that will pop up the overall margins. And we think that the clear growth that we've seen from this business, as I mentioned, the 80% gross margins are without a doubt going to be - represent the highest growth. So we expect and I think we've communicated this in the past that, when we get to the breakeven level, we should be in the low-70%s margins. And now you've got a third question relating to the businesses, the product lines themselves. And let me - it's fair to say that there we've got between Alevicyn and Celacyn, our - reasonably the same in size, reasonable similar margins. The Mondoxyne quite frankly is a little bit larger margin. But most of them are relatively similar in terms of margins. We would expect to see them grow to be somewhat similar sizes. Maybe SebuDerm would be a little bit smaller than the other markets. Did I miss one of your questions Jason?

No, you really did answer my question. So let me - and thank you, that's very helpful. At what point are you going to consolidate with the current sales-force versus continuing to add sales reps going forward? So help me understand with just under $10 million on the balance sheet in cash and burning between, we'll call it, $2.5 million and $3 million a quarter, it's very clear that adding sales reps translates into top-line revenues. How do you continue to build the sales-force as you push towards kind of that magic positive cash flow?

Yeah, we expect that we can get to our profitability level, which is our target right now with something in the 30 to 34. Currently, we have 30 full-time equivalents, but some in the range of 30 to 34. So we don't need a lot of additional sales people. That's why that cash operating expense should probably still be falling close to that range that I gave you before, to get to that point. We loaded a fair number in as - when we sold the Latin America business. We increased our sales-force by about 70% then.

Okay. It makes perfect sense. So my one last question would be, with this kind of sales-force you become very attractive to pick up additional products for them to put in their bag. So are you currently opportunistically looking for product acquisitions that would be complementary to the existing franchise?

We are actively looking for product acquisitions. And, Jim, do you want to say something about that, because I know you…?

Yeah, Jason, good to hear your voice. Bob has a funny saying. He's from Cincinnati. He's never been the pretty girl to dance before and all the sudden with this growing sales-force we are. So we're starting to see more and more European and Asian companies asking with our FDA expertise and growing sales-forces if we can evaluate their product. So exciting stuff and the sales-force is hungry to sell more products.

All right, guys. Thanks. Congratulations on the great quarter. And by the way, I really appreciate the very tight, very meaningful slide deck you've provided. It's a very clear, very concise, concise call, very well done. Thank you.

Yeah, thank you, Jason.

Thanks, Jason.

Thank you. Our next question is from the line of Laura Engle of Stonegate Capital. Your line is open.

Good afternoon. Congratulations on the quarter.

Thank you, Laura.

Just to follow-up, so related to the Invekra deal and how that's affecting margins, is there a contractual limit on that, as far as you said well into 2019, but is there an end date set?

There is an end date, and the end date is October of this year. And - but it's not…

So the two-year anniversary?

Yeah.

Okay.

Yeah, exactly. And what it means is though is we still may - they may still ask us to manufacture, but at that point in time we're no longer obliged to manufacture with a 6% margin.

Right, okay. Great.

So I will be the first in line to…

Ratchet that up, right.

But I think that's good motivation for them to switch over too so.

Right. Okay, great. And then, touching again on cash current levels versus burn, what do you see for that coming year as far as any funding needs versus reaching positive cash flow and profitability?

Well, obviously, as we get closer to that breakeven point, we would expect that our - obviously, our burn is going to go down to zero. We're hoping over the next couple of quarters to hopefully reduce that burn pretty significantly. But no forecast, no guarantees. And especially, when you look at the June quarters and the September quarters are probably our best quarters. So we would hope to see some continued growth in that arena and reduction of our burn. Does that answer your question?

Yeah, yeah, yeah. Thank you. Okay. And then, just one last one with the - related to the recent approvals in the UAE, looks like those I think are all Microcyn based products. Why - will those at any point be, will you be looking for U.S. approval? Some of them are in different areas and - or more look kind of over-the-counter type products. Is it just cost prohibitive or what are your thoughts on that?

Bob, do you want me to take that one?

Yeah, it'd be great.

And thanks for paying so close attention on that. That's you obviously spent some time looking at those products. We would love to get FDA approval for similar indications here in the States, but none of us are holding our breath. We have the benefit of a really strong safety profile in the UAE with that notified body. And they've come to understand and give us relatively broad approval. So we would love to get the same in the U.S., Laura, but it's probably not going to happen.

Okay, okay, well, I will get back in the queue. Thanks for taking my questions and congrats again on the quarter.

Yeah, thank you.

Thank you.

Thank you. Our next question is from the line of Raymond Myers with Benchmark. Your line is open.

Thank you for taking the questions and congratulations on the quarter. Let me ask you about the sales-force and the ramping productivity of it. As you look at the productivity of the new sales reps you hired last year, as they gain tenure, what visibility does that give you to how much additional productivity you would expect after they get through, say, 12 months, 18 months when they reach full productivity?

So I would - if you look at the just on a percentage basis, and you start with the 10 salespeople that we had, and let's say, we added 20 that's 200% increase. And taking from that same time point, when we had 10 salespeople and went then to 17 to then 13 more, if you go back and look at the prescription growth that's been about 150%. So we still have flexibility to grow, and but at the probably another - they're still in their faster growth pattern at this point, the 13 that we hired. But probably in the six months or so they'll probably start to level out a little bit that point. And as we mentioned, we may add two or three or four more, but - and the other thing that we're looking at is filling in with the support telephone people, and the white spaces, in particular, where we don't have sales people. We think that's a really great way to grow our revenue by using the telephone salespeople that we actually have that we're using for and part on our acute care area. So that, that we think is a good way to continue our growth.

Sounds good. The U.S. dermatology revenue per prescription was very strong in the September quarter. How did you achieve that and what does that tell us about trends for the future?

The dermatology revenue per…

Prescription.

Okay. So you mean in terms of the dollars amount?

Yeah. The prescription - the dollars recognized per prescription were quite high.

Yeah, yeah. So the - our pricing is not - is below on a per gram basis below most of our competitors, but we are able to increase prices. And we have been able to increase prices, just because we are in a lower - we've been in a lower base, and especially a per - a lower per gram in our pricing. And that's probably one of the reasons that you see that.

Okay. That's great. Do you expect that type of trend to continue, where you'd be able to hold this rate of dollars per prescription in the future?

I have to go back and look at that to answer that question to see what the exact rate is and what it looks like. And I'm not sure I could do it right off the top of my head.

Okay. I didn't mean to put you on the spot.

That's an interesting question though and I'll remember it for the next time.

Thanks. Well, it's a nice metric, you are doing well on it. On the SG&A expense, it was a bit high in the quarter could you give a bit more detail around, why it was high in the quarter? And then the guidance that it goes to $4.3 million to $4.6 million - no, did I have that right? Yeah, yeah, quarterly expense forecast. Does that include R&D expense? Or is that total OpEx?

That's total OpEx, but that's a cash operating expense taking out the - is the noncash items, especially the stock comp chart. And we were about $300,000 higher than our high, if you will, and that that came from one-time - some one-time marketing expenses, and some one-time compensation expenses that would not continue. That would not - we would not see our - hopefully see our expenses go above - the cash operating expenses go above $4.6 million other than the June quarter.

Excellent. Okay. Good. And you teased us a little bit at the beginning about potential new products. Can you tell us anything more about - for example, this Brazil partnership and what that might look like? What might contribute? And what this new product might be the spring?

Marc, you want to take the Brazil question?

Yeah. And we've been saying this now and I said in the last quarter, we're pretty advanced negotiations and discussions with a very strong partner down there. We're not at liberty to full disclose yet, but it's looking great. It would be in dermatological spaces similar to those in the U.S. So we hope to have news shortly on that.

Great. And…

And next step the approval rate, I think our regulatory guru is telling us March, April we just broadened it out to the spring, sometimes he surprises us earlier, sometimes later. But stay tuned for that and we'll share as soon as we get it.

Very good. And then last question was about the expansion to the psoriasis label. Can you talk about what impact that would have?

Yeah. The risk of repetition, we in-licensed that terrific product from a German pharma company - their brand, and now ours in the U.S. is Loyon, L-O-Y-O-N. In Europe, it's currently being sold in Germany and the UK for broader indication than we've got in the U.S. to start. They have a psoriasis indication in Germany and the UK. We took their clinical data got back into the FDA queue, and it is very, very compelling clinical data. So we have our fingers crossed that we'll get that. Bob, are we saying within the next 12 months, what's our official line on timing?

Yeah. That's all we've been saying, subject, obvious, to the FDA assay [ph].

Yeah, exactly. But it's on the market currently being sold with terrific clinicals to that indication in Europe. We hope to follow those big footsteps in the U.S. within the next 12 months.

Very good. Thank you.

Thank you, Ray.

Thank you. Our next question is from the line of Jason Kolbert of Maxim. Your line is open.

Hi, guys. I just wanted to follow-up a little bit on guidance. And just to kind of go through with you what I heard to expect kind of lower mid-single-digits on the ex-U.S. business and a more robust growth rate on the U.S. derma business. Help me understand, what you were saying, when you were talking about the annualized run rate approaching $26 million? And the reason why I'm asking you to qualify that is, because ultimately we see a run rate not stopping at $26 million going much larger? And when were you kind of thinking that you're going to be at an annualized run rate of $26 million. If you could provide a little bit more clarity on kind of the timing of that, and did I get what you were saying about the U.S. versus rest of world, correct?

Yeah, you did about the U.S. versus rest of world. That is correct. In terms of our $26 - first of all, our $19 million, just taken 4.8 and multiply it times four, which I know, you know. The $26 million is a general guidance that we provided to say that is about the range plus or minus some dollars. That's about the range that we would be at breakeven. That is…

Okay.

That's not our limit in terms of where we could end up in X years…

Of course, not.

Yeah. That's about where we would and you could divide that by four to get sort of a quarterly run rate…

Sure. No, I can figure that out. So let me just change the question to given kind of where the growth rate is now and putting a higher percentage on the U.S. I can do my calculations in terms of what kind of growth I might see for this year and for next year. As you work towards breakeven, which is now kind of in-sight, is that fair?

Yes. So, it's, well, still - you really have to go through and look at, and then you can do - the math that you're doing take our international…

I'm a former pilot, I have really good vision, right?

I know, you're a former Marine pilot, which even makes it better. So - but anyway and I - but anyway the - going back to the win, I think it really comes down if you take the - let's to say that we've got 50% of the business just to make it simple. It's growing at 5% to 10% or single-digit year-over-year. And then you've got another 50% of business it's going at a quarter-over-quarter growth rates, which are showing in, let's just pick out the graph that we showed on Page 8, and you can see we're looking then at a range of quarter-over-quarter growth rate, December was 5%, but that tends to be a lower quarter as does March and September and June. So it's something probably in the range of quarter-over-quarter in the range of 5% to even 10%, if you want to do it. But these are numbers that you can probably you're better guessing than me over time. Given…

Yeah, but I mean, what I can see as long as the fundamentals that are driving growth and sequential growth that we saw from the last quarter to this quarter. As long as those fundamentals are intact, it's just a matter of time and effort. And the thing that I wonder about is that you start to get more brand recognition among physician prescribers. Do we reach a tipping point of critical math, where the numbers could really move higher? And you're not forecasting that? You're not saying that? But at some point awareness is going to - should translate into momentum, and that's how you really win, in terms of as a company and as a shareholder.

We agree, we would love to see the expansion of the brands. We think, there a whole number of additional applications with our current Alevicyn brand. Celacyn brand has a big market, already the scar treatment market. And even into non-derm areas, we're seeing it being prescribed, because only two on the market - two prescription scar products on the market. So yes, we expect to see the brands expand, but it's coming back to a key reason for this growth historically, the additional salespeople. So there are two things that will be a little bit have a - basically indicate that maybe the growth would be a little bit slower than what we've had at this point. And that is we're going to not increase the number of sales people very much. And two, as the numbers get larger the growth rates are more difficult to achieve. So…

So one thought though is that I understand being nervous about adding more salespeople, but it's pretty clear this is a huge market and as long as they are accretive, why not keep adding them?

Yeah, we actually think the bigger return for the money is, we will add some more salespeople. But the bigger return for the money is some of the telephonic sales and covering the white spaces, and also working with the current feet on the street and supporting them in dermatology. We think that can, because you can have somebody, this is not nearly as costly as the salesperson and the expenses are nearly as high that can give us a really high return and help grow these markets.

Okay. Sounds good. Thanks for allowing me to ask all the questions. I appreciate it.

Thank you, Jason.

Thank you, Jason.

Thank you. Our next question is from the line of Eric Panzig, [ph] a private investor. Your line is open.

Good afternoon, gentlemen. Thanks for a good quarter. Two, general questions; and one, technical question. So the most important thing to me is investor interest, supply and demand. When I got into the name, I guess, it may have been 18 months ago, maybe two years ago. Then you announced a deal - you announced a deal, where you're getting cash more than the stock was trading at, a capitalization as a goal [ph] or something wrong there. So we got a whole lot of cash. And then you targeted use and you certainly had been successful in garnering sales and quarter-after-quarter the vision seems to be materializing. I saw that you went to run and perhaps to - I guess it was to investor conferences. But the daily trading volume, and I call that dollar volume. It was only a couple of hundred thousand dollars a couple years ago or whatever 18 months ago. And that's already kind of anemic, but at least to have some liquidity. Recently it is in the tens of thousands is that on a daily basis, which shows a lack of interest, and honestly, a loss of interest. And since we rollout the story and all the execution on the story, people have lost interest and sort of gain interest. So how we're going to both get the word out and attract people to the name.

You want me to clarify it?

Sure, you can do it, yeah.

Yeah. We - Eric, we have a terrific investor in Denver, who gave us some sage advices about 12 months ago that says, keep your head down, execute and Wall Street will find you. We're certainly trying to do that. We do attend the conferences that you just referenced, the investor conferences. We do have a terrific IR firm. We are somewhat active with on the investor relations side. But I'll tell you, most pleasing is to hit these numbers and then to talk to guys like you about that.

Okay, fair enough. I'm sorry. Go ahead.

Let me just - let me add that we do hit most of the key. We were just at Noble. We were at Dawson James. We go to Rodman. We were at Sidoti. We've done the microcaps, even went to the [Fire West] [ph] down in LA. We hit most of the key microcap conferences if you will or the small company conferences. And we're pretty active in that arena. We like telling our story. And our liquidity is not terrible, but yes, it's something that we would want to increase and have more people interested. So we're open to ideas on how you do that.

Yeah, I think that attending those road shows, issuing press releases when you can, when they're material, and materiality, of course, is objective. And sometimes companies choose to release press on their sales before they get to an earnings call. So there is yet another press release out there that people can feel good about or at least notice. So there are things, I guess, as a couple of day's trading volume couldn't support the number of shares if I wanted to sell. So at this point, I'm in. There's no way I can get out. But the - I think we all are educated enough to understand that if the stock is, I don't want to call undervalued, but it isn't reflecting the potential. And cash runs out and you have to go to the market and raise money. It's going to be raised at lower price, mean dilution at a greater rate for folks like me. So, yeah, I'm concerned about it. And I think that other folks would be concerned about it. And I would just end that topic by saying that there are certain people who won't invest in our companies just because of the number of shares that trade on a daily basis. So it's a shame, it's a shame. So anything you can do would be helpful. On that note, I noticed - I knew you can just give some color on that. So you mentioned something about an institutional investor, $1 million. And I noticed the number of shares quarter after quarter, on the quarter book 2%, 3%, 4%. And what's going on there, I'm sorry?

Well, we do have restricted stock programs. We do have stock option programs. That type of thing that may be going up. But we - is that your question, why does it go up 2% or 3%?

Yeah, well, I certainly see the 8-Ks regarding - I'm sorry, the 4, whatever they are, 4 something, regarding the insider transactions. But I thought you had mentioned on the call that there was a particular investor, an institutional investor that there was a $1 million transaction this quarter [indiscernible].

Yeah, yeah, yeah, okay. That was one of our better shareholders came to us and indicated that they like to put money in - they'd like to put some additional money into us. And they did it through the ATM, at the market. And they are - they do that because they're using their tax ruling 1202. So they - if they hold it for five years, they don't have to pay - there is a - they get an improved tax benefit from that. And we are somebody that - we thought that was a good deal for us.

Okay, okay, so that explains and I appreciate that. Lastly, and you'll have to excuse the - I'm a finance guy to the technical needs…

That's okay, I am too.

I know but, Bob, you're going to kill me here. Okay. Revenues, we're talking FY or the current FY, revenues Q1 up 45% year-over-year; Q2 up 55% year-over-year; Q3 up 44% year-over-year. Those are yippee numbers in all cases. Margins, up the - as a percentage of revenues Q1 80%, as a percentage of revenues in Q2 78%, as a percentage of revenues in Q3 39%. So went from 80% to 78% to 39%. I heard your dialog on the 6% Mexico deal. But if I throw my Excel spreadsheet, the difference in margins from Q2 to Q3 in dollar terms, that's $520,000 in margin. If I divide that by 0.94 to get to the revenue portion of what a Mexico impact might be if a 100% of the margin increases Mexico, then I come out to a number, $553,000. That's actually bigger than your revenue increase.

A lot of the prior comparisons that I can't respond to each one of each of the quarters, I'd have to go back and double check.

Sure, right. Go ahead.

I'm trying to - when you change - when we sold Latin America we had to undertake discontinued accounting for that particular asset and the revenue in that. And we had to make a number of assumptions relating to how we divided that up and what expenses we take out, and what we include into COGS in Mexico and take out. It's a complex, but pretty regimented rules that you need to follow. And that did have produced some changes that may not be - may not seem rational to the normal analyst. But I'd have to go back and double-check each one of those to really respond to your question. I'd…

Okay, and I won't - I won't put you on the spot.

And I'd be happy to do that. Yeah, I'd be happy to do that…

No, I won't put you on the spot. I apologize, Bob. I guess, my question would be generally - I look at all your presentations. But generally, the revenue from Q2 to Q3 actually did increase is the question outside of the Mexico deal or [is it] [ph]?

Oh, yeah, from Q2 to Q3 is all the Mexico accounting took place. All of it disappeared. Most of the discrepancies occur in the comparison to look the prior year. And especially, when you're talking about a prior year, when we were looking at 2017 compared to fiscal year 2016 for instance, where we had to go back and modify the in effect the P&L excluding a lot of the revenue and expenses in Mexico, then that's where it makes a difficult comparison in discontinued accounting.

Okay. Well…

Now, the change from Q2 to Q3, and it, I believe the margins were not that much different in Q2 to Q3 in terms of our COGS. But maybe at this point, it's probably worth taking this offline. And confirming your numbers and my - and I'll take a look at it and I'd be happy to talk to you - without taking everybody else's time.

Great, great. Well, thank you so much, Bob. I appreciate your patience with my questions. I'll - well, thank you again. Bye-bye.

Bye.

Thanks. Thank you, Eric.

Thank you. I'm showing no further questions at this time. I'd like to turn the conference Bob Miller for closing remarks.

Yes. First of all, thank you everybody for joining our call. We are particularly proud of the results of the Sonoma team for this quarter. And for - we thank you for your continuing support. We feel that Sonoma is in the best shape that we've ever been in for several reasons. One is Sonoma has effectively executed a turnaround strategy in a very attractive dermatology market, with a strong experience and effective sales team, a robust unique non-steroidal, non-antibiotic product portfolio and growing product pipeline. Over the last three years, as we've spent a lot of time on, we have demonstrated a strong track record of quarter over quarter growth in the prescription dermatology market. Our commercial EBITDA profitability plan, which is very simple, is an extension of a three-year track record. It includes revenue growth with the efforts of our 30 sales reps, the launching of new products and the continued growth of current products and through price increases consistent with comparable products. We believe we have a foundation and all the building blocks in place to achieve our EBITDA profitability. With that, we thank you for the call. And at this point, we look forward to sharing with you our progress on our next quarter. Thank you.

Ladies and gentlemen, thank you for your participation in today's conference. This does conclude the program. You may now disconnect. Everyone, have a great day.