Good morning, and welcome to the Tenet Healthcare First quarter 2023 Earnings Conference Call. After the speaker’s remarks, there will be a question-and-answer session for industry analysts. [Operator Instructions] I’ll now turn the call over to your host, Mr. Will McDowell, Vice President, Investor Relations. Mr. McDowell, you may begin.

Good morning, everyone, and thank you for joining today’s call. I am Will McDowell, Vice President of Investor Relations. We’re pleased to have you join us for a discussion of Tenet’s first quarter 2023 results, as well as a discussion of our financial outlook. Tenet senior management participating in today’s call will be Dr. Saum Sutaria, Chief Executive Officer; and Dan Cancelmi, Executive Vice President and Chief Financial Officer. Our webcast this morning includes a slide presentation, which has been posted to the Investor Relations section of our website tenethealth.com. Listeners to this call are advised that certain statements made during our discussion today are forward-looking and represents management’s expectations based on currently available information. Actual results and plans could differ materially. Tenet is under no obligation to update any forward-looking statements based on subsequent information. Investors should take note of the cautionary statement slide included in today’s presentation, as well as the risk factors discussed in our most recent Form 10-K and other filings with the Securities and Exchange Commission. With that, I’ll turn the call over to Saum.

Thank you, Will, and good morning, everyone. We’re off to a nice start for 2023. Strong volumes support good results in all three business units. USPI’s performance continues to accelerate given our focus on organic growth and is ahead of our expectations so far. In the first quarter, we delivered net operating revenues of $5 billion and consolidated adjusted EBITDA of $832 million, which translates into an attractive 16.6% margin. As a result of our strong performance in the first quarter, we are now raising our full year guidance, which demonstrates the confidence we have in our operations. Across our businesses, a post-pandemic environment is taking shape, COVID admissions are down, a wider range of acuity is returning to the hospitals, deferred GI procedures are returning and our workforce is starting to stabilize. We have anticipated this for some time, and our strategy, operating efficiency and capital discipline enable us to deliver attractive performance in this environment. We had a great quarter at USPI with $340 million in adjusted EBITDA, which represents 21% growth over first quarter 2022. Same-facility cases grew 7.9% and adjusted EBITDA margins were strong at 37.6%. As I’ve said before, the continued migration of procedural services into the ambulatory setting is a sustained and significant tailwind for our business. Growth in our active physician population as well as higher acuity service line expansion, especially GI, urology, ENT and orthopedic cases, drove the first quarter volume strength. We are pleased to have our organic growth initiatives gaining traction and bearing fruit. Our USPI development pipeline remains active and healthy. We added three new centers in the quarter. We completed two additional post-transaction buy-ups in the quarter at multiples unchanged from prior buy-ups. Progress continues in this area. As previously discussed, USPI’s M&A engine under the Tenet umbrella…

Thanks, Saum, and good morning, everyone. Our financial results in the first quarter were strong with our USPI and Hospital’s adjusted EBITDA and same-store volumes and revenues well above our expectations. In the quarter, we generated consolidated adjusted EBITDA of $832 million above the high end of our first quarter guidance range. Our results were driven by strong same-store revenues and volumes, continued high patient acuity for non-COVID patients, and effective cost control. Now, I’d like to highlight a few key items for each of our segments. Let’s start with USPI, which delivered strong growth and continue to provide high quality care to our patients. In the quarter, USPI produced a 7.9% increase in same facility surgical cases compared to last year, with strong growth in GI, urology, ENT and orthopedic cases. Surgical cases were 107% of pre-pandemic levels in the quarter. USPI’s adjusted EBITDA grew 21% compared to the first quarter of 2022 and its margins continue to be very strong at 37.6%. We are pleased with USPI’s excellent start to the year. This strong performance is a testament to the attractiveness of the portfolio and value that we provide to our stakeholders. Turning to our acute care hospital business, first quarter same-hospital adjusted admissions increased 6.7% compared to the first quarter of last year and total same hospital inpatient admissions increased 4.3%, while non-COVID admissions increased 14%. Our labor management continues to be very effective despite the cost pressures, especially temporary contract nurse staffing costs. On a consolidated basis, contract labor costs were 6% of SW&B, a significant decline from 7.3% in the fourth quarter 2022. Total hospital costs were well managed in the quarter, as these costs were 2.7% lower than first quarter 2022 on a per adjusted admission basis. When you exclude the impact in the…

Thank you. We’ll now be conducting a question-and-answer session. [Operator Instructions] Our first question today is coming from Brian Tanquilut from Jefferies. Your line is now live.

Hey, good morning, guys, and congrats to the good quarter. I guess my question is just how much improvement do you think you have left to bring down temp labor? I know you’re reinvesting some of that in wages for your permanent employees. But as we think about temp labor and maybe SLB [ph] as a whole, what do you think is the remaining opportunity for that embedded in your guidance and even as we look into next year? Thanks.

Hey, Brian, it’s Saum. Good morning. We do expect some additional moderation in our contract labor spend as we move through the year. The operators have done a really phenomenal job, managing this, obviously a very difficult environment. Our recruiting and retention measures have been improving, which is helping to mitigate some of the incremental costs associated with contract labor. So we are expecting some additional moderation as we move through the year. But as we’ve said when we released our guidance in February for this year, we are not expecting our contract labor to get back to pre-pandemic levels certainly that won’t happen this year.

Thank you. Next question is coming from Pito Chickering from Deutsche Bank. Your line is now live.

Yeah, good morning, guys. Thanks for taking my questions. A great quarter. For guidance, you beat the midpoint of the first quarter guidance by $57 million. You raised 2Q by $50 million above The Street, but only raised the full year by about $50 million. So, just curious, should we read sort of into the implied back half of the year guidance reduction? Is this conservatism something that The Street was missing or simply did The Street misunderstand the seasonality for the back half year versus the first half year?

Hey, Pete, it’s Dan. Good morning. Now, you shouldn’t read it into anything of that. Listen, we off to a good start to the year. We beat by $57 million, and we’ve raised our guidance by $50 million. So we’re optimistic and we’re encouraged by the trends that we’ve seen and that shouldn’t read anything into it.

Great. Thanks so much.

Thank you. Next question is coming from Justin Lake from Wolfe Research. Your line is now live.

Hey, guys, thanks for the question. This is Austin [ph] on for Justin really strong core on the volume side, both in USPI and the Hospital. Just curious, you guys had kind of talked previously some service line flexing in the hospitals and then some COVID driven interruptions in USPI. Were any of those still present in the 1Q here or are we kind of at a clean comp going forward? Thanks.

Hey, it’s Saum. On the Hospital side, as Dan was just talking about with one of the prior questions, as the contract labor rates come down, and I indicated a little bit in my comments, it opens up the ability to improve access for services. We know the demand has been there, it’s always been a bit about whether that demand at scale was serviceable with very high contract labor costs. And, I think, in particular, as the contract labor rates come down, it makes it easier to make decisions about utilizing contract labor versus the full time labor from the perspective of opening up that hospital capacity to take in more volume. And, obviously, imperative in that is that we to have discipline in our overall cost structure, productivity, length of stay, things that we’ve talked about for the past few years during the pandemic. Continuing to remain focused on that so that we can generate strong margins as we open up the capacity, even if some of the work that returns is lower acuity. On the USPI side, I’m really pleased with the volume strength. This is not – we’ve talked over the last couple of three quarters about things that were going on in the business, certain types of low acuity business that we were strategically and otherwise having reductions in that affected it. This quarter demonstrated growth in the services that we want to grow. Strong return of GI services, orthopedic strength was strong. And in particular, I’ve commented about pain before, the volume strength is not coming from pain that business was flat year-over-year. So this isn’t a volume recovery based upon kind of, so to speak, engineering certain service lines that we were dampening our interest in, but it is actual strength in many of the areas. And I think most importantly, breaking through significantly the pre-pandemic volume levels is a really important marker for USPI and the ASC industry, because it suggests that there will be strength going forward.

Thank you. Next question is coming from Calvin Sternick from JPMorgan. Your line is now live.

Yeah. Hi, good morning. I wanted to ask about some of the SCD II centers and how the integration is progressing there? I know you talked about the slower position bias last year and the ramping of some of the de novo in developing centers. So just curious how that’s trended so far just to sort of understand some of the progress.

Thanks. Yeah, no, good question. Good update. As I indicated, the buy-ups continue the progress and the buy-ups continue at multiples that are not changed from any of the prior multiples. So that’s good. And the centers that were in-development, as I kind of described them somewhere from the point of having broken ground to just having opened. We expect all of them from that original transaction number two to be opened up this year, and that’s a good thing. Those partnerships are still strong and intact. So, I think, we’ll see positive movement. Like I said a last time, we were about a year behind the original plan, but the original plan is still the original plan.

Thank you. Next question is coming from Kevin Fischbeck from Bank of America. Your line is now live.

Great. Thanks. Just wanted to ask about your views about the volumes in the quarter. It sounds like the volumes were stronger than we were looking for. It sounds like maybe they were even stronger than you guys were looking for. Is there something that you would point to as to why all of a sudden 2023 is the beginning of this volume rebound? And maybe to go back to that earlier question about the guidance, because it is kind of you raised for the beat, it sounds like it’s conservatism, but is there any reason to believe, either based upon how volumes progressed through Q1 or so far in Q2, that these higher volume numbers wouldn’t persist?

Yeah, this is Saum. So a couple of things, I think, the volume strength at this point, we really have our information and what we’ve read publicly about HCA’s information. I think there is some industry recovery going on as we kind of enter this post-COVID, post-pandemic anyway environment, where people are getting more comfortable returning to healthcare. We know that from our physicians’ offices. They’re now all pretty. The ones that we employ and run are now all running at full throughput in the outpatient environment. Obviously, that helps to create demand. I think that we’ve in our case gotten much more effective and efficient with our ER throughput and operations across the board. That was a big focus area last year that we didn’t talk much about. But with the staffing shortages, having adequate throughput, having fast track setups in our ERs and things to improve that throughput is important to be able to service the demand. And then for us, in particular, I think that as we get into this post-pandemic environment, hospitals are going to naturally be able to hold onto and deliver when they have put in the right infrastructure, doctors and technology for higher acuity services that don’t have a substitute location to go to. And for us, that’s an important piece of the recovery puzzle across the board. Look, the other thing from a Tenet portfolio perspective, as we indicated, our portfolio has a pretty broad range of exposure to markets that handled states, that handled COVID differently. And we always had a little bit more recovery to go in some of the states that were more locked down. And I’m pleased to see that we’re seeing some volume strength in those markets as well. At USPI, I think, there’s a couple of things, one is we put a lot of focus and reengineered some of our processes, incentives as well as service line priorities in the third quarter and fourth quarter of last year, going into this year to focus a bit more on. Some of the things that we wanted to grow rather than just some of the things that we were trying to optimize out as a low acuity service. And I think getting that balance right has helped create some momentum at USPI with respect to organic growth. There’s really no reason that I see looking forward at this point that that should change. And I’ll just add my commentary to the guidance. Look, we’re pleased to have delivered a good quarter, and we’re pleased to have raised our guidance at this point in time. We’re optimistic about the future, and we’ll revisit as we look forward, depending on what the results look like.

Thank you. Next question is coming from A.J. Rice from Credit Suisse. Your line is now live.

Hi, everybody. I wanted to just ask about two other areas that haven’t been touched on. As you’ve done your analysis on redeterminations, we’re getting sort of different views as to as people roll off of Medicaid, get picked up on public exchanges, or hopefully on the commercial rolls, whether that’s a neutral event for you guys or a positive. However, you factored that into guidance, and then any update generally on your managed care contracting, I know this year you got a little help. It seemed like from labor rates and labor pressures rather. Is that following through in your discussions for 2024? Do you think you’ll get some help on the labor side there in rates for 2024?

Hey, A.J. It’s Dan. Let me try to address those in terms of the Medicaid redetermination, I would say, at this point we haven’t seen anything, any substantive impact from the redeterminations, which really just began. But I would tell you that we have Conifer in our hospitals, we have dedicated resources to address this as the redeterminations occur state by state. We have communications across the enterprise through all levels of Conifer in the hospitals. We’re doing other types of communications like webpage banners with links to state enrollment websites. We’ve been going through and revising our screening scripts and reenrollment questions, updating various resource documents, messaging at registration point of entry and in broader messaging campaigns across our facilities. And also working with community members, non-Tenet community members on the community and working with them and tracking some of those statistics. So far, nothing significant, but we think we’re on top of it and we’re monitoring it closely. In terms of your question, in terms of the guidance for the year, as we said in February, we haven’t assumed any significant upside or downside from the redeterminations. We think it’s premature at this point. Obviously, the exchange enrollment statistics were very encouraging in terms of the growth. So some of the individuals who may transition off of Medicaid rolls, you would expect that many of those would potentially reach out and try to obtain exchange coverage. But again, we haven’t factored anything significant into our guidance this year. In terms of the commercial contracting, I would say consistent with our previous messages on this. We think we’re very well positioned from a contracting perspective. We’re essentially 95% contracted this year, and around 85% next year and even 25 fair amount of our business is already contracted. Listen, the terms been clear, it’s not like we’ve been getting CPI type of increases in every contract negotiations, but what we have seen, obviously, the levels of inflation are top of mind, they always have been, but certainly more pronounced now. And the conversations obviously are being held with the plans. And I would say some of our more recent negotiations, it’s a little bit better than what maybe we historically would have negotiated.

Okay. Thanks a lot.

Thank you. Next question is coming from Josh Raskin from Nephron Research. Your line is now live.

Hi, thanks. Good morning. I just wanted to get back to USPI and that 9% plus same-store revenue growth number. I was wondering if you give us some more color on maybe perhaps geographies and whether these were legacy centers or some of the newer ones that are ramping up. And then did you give a number for the buy-ups for the second SCD transaction? And then lastly, I hate to keep harping on this guidance, but the guidance for USPI specifically, sort of implies a lower growth rate for EBITDA over the next three quarters than what you saw in the first quarter. Any changes to seasonality, anything about that, or just sort of consistent with the overall message on guidance?

Hey, Josh, it’s Dan. Let me start. Now, in terms of the guidance, obviously, USPI is off to a great start to the year. We increased the guidance $20 million for EBITDA. Strong volumes – we also increased our volume guidance assumptions from 2% to 3% to 3% to 4%. So we’re obviously encouraged. Again, as I mentioned, another question, there’s nothing to read into this. It’s early in the year and we like what we’re seeing and we’ll continue to obviously reevaluate where things stand at the end of the second quarter and make any guidance changes if appropriate. At that point in time, the USPI business continues to generate incredible margins, so we’re very pleased with the start to the year.

Thank you. Next question is coming from Ann Hynes from Mizuho Securities. Your line is now live.

Hi, thanks. I just want to talk about the no surprise billing act. Is that having a negative impact on surgery volume at USPI? Some data that I’ve seen and check suggests that maybe anesthesiologists aren’t making as much money, so they’re gravitating more towards inpatient or outpatient departments given the reimbursements higher. So I guess is this having an impact? And if so, what do you think it is on the dragon [ph] volumes?

Just a couple of comments there. I’m not sure I could credibly answer that question with data. It’s an interesting question and something that we’ll look into to see if we can identify any trends there. But what I would say is that the pressures that we’ve talked about before in the staffing arena for hospital-based or ASC-based physicians, in particular, in anesthesia is certainly an area that’s requiring a lot of work. Your commentary about the activity and revenue intensity for anesthesiologists in hospitals versus ASCs is certainly true. But again, remember, our payer mix in the ASCs is significantly better, and that creates a draw to the ASC environment, in particular in RASCs [ph], the way they’re set up. So while there’s some pressure there, we’re managing through it. And again, I would have to say that we’d have to take a look at the data more carefully to answer your question in any kind of statistically relevant manner, but it hasn’t bubbled up as a major driver of the volume issues that we saw in particular last year in the third quarter.

All right, perfect. And then, Dan, I know you up free cash flow guidance, which is good. And can you remind us, do you have any share repurchase or incremental debt repayment and guidance at this point?

No additional share repurchases are assumed in the guidance, and that was consistent with how we started the year with our guidance.

Okay, great. Thank you.

Sure.

Thank you. Next question is coming from John Ransom from Raymond James. Your line is now live.

Hey, there. Kind of an end of the weeds [ph] question because all the good ones have been asked. If we look at the rest of the year on USPI and you look specifically at revenue per procedure, what’s going on there in terms of rate versus just mix? I mean, we assume there’s some natural lift as you get more ortho and less pain, but if you could kind of help us understand what’s going on in that line item? That’d be great. Thank you.

Yeah. No, John, I appreciate it. And that is still a good question, so appreciate it. Listen, I think there’s a couple of things, as I indicated, and I think we’ve talked about this a bit before, but maybe not as specifically. There are certain areas of healthcare services that were deferred or more actively deferred and I think in our ASC business in particular, we saw a dampened utilization of procedures that might have preventative value and in particular in the Medicare population. For us in general, that’s a good sign that it’s coming back, even if there’s some impact on the net revenue per case. Because ultimately as the ASCs become fuller, we’ll get benefit from capacity utilization. And we had prepared for this a bit, we weren’t sure when it was going to come back, to be honest, but we had prepared for this a bit by looking like we would in an acute care hospital environment for efficiencies within our ASCs that would help to maintain our margins. So we’ve been focused on knowing that this business is going to come back, knowing that some of the mix would be a little bit more challenging and doing the preparatory work to ensure that we maintain our margins by finding efficiencies in advance of it coming back. And it happened to come back a bit this quarter and, again, I think that’s a good sign. Our independent physician partners’ offices running at full throughput, similar to what we’re seeing with our employed physician practices, if that happens across the board, I think, that’ll be a nice tailwind. It’ll give them the confidence sometime this year to maybe recruit new partners to their practice and continue to grow their own businesses, which again will represent some long-term tailwind in our partnerships with them at USPI. So I think this is a good cycle to be in, even if some of the mix and other things in the short-term will be a bit more challenging. We’ll stay focused on the margin performance.

I take from that as a big colonoscopy quarter, is what I’m hearing from you. Is that what you think about it?

Thank you. Next question is coming from Sarah James from Cantor Fitzgerald. Your line is now live.

Thank you. I was hoping you could walk us through how you think about margin evolving as we start to come out off of the peak of labor shortage. So how much margin leverage can you really get from scale as you’re able to staff up? And then how do you think about some of the payer rate increases possibly flowing through to margins?

Hey, Sarah, it’s Dan. Good morning. Listen, obviously, we’ve strengthened our margin significantly over the past several years, not only through USPI, but the hospital margins as well. And we’re very mindful of that and as additional volumes are treated and cared for given the efficiency of our hospital platform, we think there’s opportunities for margin expansion. And, obviously, the USPI’s margins are phenomenal anywhere depending on the quarter from the [high-30s to 40%] [ph] territory. But yeah, certainly, adding additional volumes can help in terms of given at least on the hospital side, there are certain fixed costs and so we can take on additional volumes and be profitable with it and have a nice margin associated with it. The operators, they’ve done really just a phenomenal job during the past several years in driving efficiencies and incredibly highly inflationary and challenging environment. And you see it in our cost statistics clearly. In terms of commercial pricing, as I mentioned earlier, we feel very good where we’re at from a contracting perspective and more recent negotiations, we’ve been able to negotiate rates with annual escalators that are a little bit higher than historically we may have negotiated. So we feel good about where we’re at from a contracting perspective.

Thank you.

Thank you. Next question is coming from Ben Hendrix from RBC Capital Markets. Your line is now live.

Hi, thank you very much. Certainly, appreciate the sequential color on improvement in agency cost in SW&B. But could you talk a little bit about how that impacted inpatient capacity constraints, specifically, your peer HCA noted decline in rate of admission, declines as a percentage of inpatient volume? And I hope you can give us an idea of how that has trended for the acute segment, how you see that progressing this year given your labor strategy? Thank you.

This is Saum. As I indicated before, I think probably the most important marker that we look at is the contract labor rate. I mean, we’re building up our workforce. We’ve been focused on that for over a year. It has been slow going. It’s improving quarter-over-quarter-over-quarter, which is a good thing in terms of recruiting and retention. But ultimately, the structural shortages in the market from a labor perspective haven’t just disappeared as we move from 2022 to 2023. And so contract labor is still an important resource, but as those contract labor rates begin to normalize, you can use that contract labor more freely to open up capacity. For us, the math equation, if you will, on where we open up capacity and how varies a bit, because our markets are in different stages of recovery, different kind of cost structures, even different contract labor rates that we face in different markets. And so we kind of take that market by market. I think part of the volume strength that you saw in Q1 reflected the fact that, as we indicated, opened up access to some of our services a bit more than we had in the past. And that’s good, because it’s not only testing whether the demand is there, but it’s also our ability to service it at healthy margins. And that ended up being a good test for this quarter. And so we’ll keep pushing on that. But we are also very focused on trying to drive contract labor unit rates back towards pre-pandemic levels. And though they won’t get all the way there, perhaps, we’re driving in that direct action this year.

Thank you.

Thank you. Next question is coming from Andrew Mok from UBS. Your line is now live.

Hi. Good morning. Adjusted admits were up 6.7% in the quarter and outpaced inpatient admissions by about 240 basis points. Can you help us understand what’s driving that spread? There weren’t any obvious drivers in the outpatient stats that would blend adjusted admits higher. Thanks.

Yeah. Hey, Andrew, it’s Dan. It’s just a mix of the intensity of the outpatient volume, the gross revenue in relation to the inpatient side. That’s the primary driver there. Obviously, our volume strength in the quarter was very strong. We’re pleased with what we saw and it was consistent throughout the quarter, which was encouraging, too.

Got it. So mix and acuity on the outpatient side was a driver of the strength there.

Yeah, that’s a contributor to. And as I said, what was encouraging not only on the hospital side, but also on the USPI side, the volumes were generally speaking strong throughout the quarter.

Got it. Thank you.

Thank you. Next question today is coming from Jason Cassorla from Citigroup. Your line is now live.

Great, thanks. Just wanted to ask about uncompensated care trends, it looks like bad debt in the quarter was up pretty decently year-over-year that could be a comp issue, but any color on what drove that bad debt expense higher and just overall uncompensated care of 12% year-over-year in 1Q? I think that uncompensated care stat was up about 10% back in fourth quarter too. So just any color on uncompensated care trends would be helpful. Thanks.

Yeah. Hey, Jason. It’s Dan. Listen, I would say the year-over-year comp is probably more last year in seeing some lower levels. I would tell you overall the uncompensated care, we think, it’s been manageable. We spend a lot of time with our Conifer team and hospital resources doing everything possible for when someone who does not have an insurance, we assist them and we do an incredible job of finding other forms of insurance through our eligibility enrollment program. So I wouldn’t say you’re never concerned about uncompensated care, but the trends are essentially in line with what our expectations were so far this year.

Okay. Got it. Thank you.

Thank you. Our final question today is coming from Stephen Baxter from Wells Fargo. Your line is now live.

Yeah. Hey, thanks for the question. I want to ask another one on the Ambulatory side. It’s a little bit of a longer-term question. I was hoping you could talk a little bit more about the outlook for ortho procedure growth and the opportunity here over the next couple of years. We’ve had this massive shift of ortho procedures from the inpatient hospital setting to the outpatient hospital setting compared to where we were pre-COVID. I guess for the ASCs, do you think about this shift as having pulled forward the opportunity there in a meaningful way? And then second, what do you need to do strategically to help migrate these procedures into your ASCs? Thanks.

Yeah. Hey, it’s Saum. I think a couple of things. First of all, you’re right that a lot of what used to be done inpatient with a multiday stay, even if it was a short stay, is turning into hospital based outpatient surgery. And I would say the moment you have something that turns into hospital based outpatient surgery, there’s going to be a subset of patients that will qualify in an ambulatory surgery setting. Over time, it’ll be more the comorbidities that patients have that determine the site of care rather than the technical nature of the potential procedure and what that recovery will look like from the standpoint of being able to ambulate and get home on a same day basis. So that’s really, I think, what will end up determining what the ultimate mix of inpatient hospital based outpatient, especially when there’s certain comorbidities that one needs to be careful with versus a fully ambulatory ASC outpatient setting. I would tell you that our belief in the ASC setting in this area for much more runway comes from the fact that we continue to see growth in the ASC setting. We continue to see new patients, including Medicare senior patients that are older, being effectively treated in the ASC setting along with expanding the commercial market. And we continue to see physicians coming to USPI wanting to initiate their first orthopedics de novo work in our centers either through new center development or joining existing centers. So I think there’s still demand in runway to go for ASC based orthopedics. Longer term, what we’re focused on is looking at areas within orthopedics or even spine work that today are very much done in the acute care hospital and developing clinical algorithms to figure out how to safely do those types of procedures more actively in the ASC setting. So in orthopedics, an example of that would be shoulder surgery and as I indicated, spine surgery, and I think we’ll see a migration in those areas in a few years as well.

Thank you. We’ve reached the end of our question-and-answer session. And ladies and gentlemen, that does conclude today’s teleconference and webcast. You may disconnect your lines at this time and have a wonderful day. We thank you for your participation today.