Welcome to Viasat's Fiscal Year 2022 Third Quarter Earnings Conference Call. Your host for today's call is Rick Baldridge, President and CEO. You may proceed, Mr. Baldridge.

Okay. Thanks for joining us today everybody. We released our Shareholder Letter earlier today before the market opened and we hope you’ve had a chance to take a look at that. Joining me today on the call is Mark Dankberg, our Executive Chairman; Shawn Duffy, our CFO; Robert Blair, our General Counsel; Paul Froelich, from Corporate Development; and Peter Lopez from Investor Relations. Today's call will consist of some -- just a couple of brief opening remarks and then we'll go into Q&A. First let's have Robert provide us some Safe Harbor.

Thanks Rick. As you know this discussion will contain forward-looking statements. This is a reminder that factors could cause actual results to differ materially. Additional information concerning these factors is contained in our SEC filings including our most recent reports on Forms 10-K and 10-Q. Copies are available from the SEC or from our website. With that, back to you, Rick.

Okay. Thanks Robert. First if you didn't have a chance to read the letter you can see our business continues to perform well on almost every front. So today we'll go into some of the details talk about the ViaSat-3 schedule and give you an update on the Inmarsat transaction. We've tried to answer a lot of the questions that we've been getting in the letter but also hope to answer any remaining questions here in a few minutes. With that, I'll start with a few of the important highlights of the quarter. Revenue grew by $144 million year-over-year to record $720 million, while adjusted EBITDA also reached a new record of $163 million, which continues the momentum over the last several quarters. We grew year-over-year in each of our segments as well. In Satellite Services, year-over-year revenue growth of 40% was driven mainly by the performance in our IFC business both aircraft return to service and new customers such as Delta coming online, as well as contributions from the RigNet and EBI acquisitions. Fixed broadband was reasonably flat as we continue to reallocate finite bandwidth resources to our growing mobility business. Overall, 37% of our Satellite Services revenue came from mobility in the quarter. International and other revenue underscoring the increasingly diversity of our businesses. Those businesses have the greatest growth opportunity and we anticipate we'll continue to diversify our Satellite Services portfolio as we go forward. Government Systems had good revenue performance with service revenues up 5% year-over-year and total revenue up 2% year-over-year. While we saw a strong performance from tactical SATCOM radio and tactical data link's products there have been longer than anticipated delays in processing certifications required prior to delivery of some of our security assurance product orders. In addition to the $956 million of…

[Operator Instructions] Our first question comes from the line of Ric Prentiss of Raymond James. Your line is open.

Hello. Hey, everybody.

Hi, Ric.

Happy New Year, I guess officially.

Happy New Year.

Yeah. A couple of questions for you guys. First, obviously ViaSat-3 is slipping a little bit 3B about six months till after the first 3A. How should we think about magnitude of costs that you need to put in for ground and other operating expenses before the revenues start generating and what kind of pacing there might be as far as cost or revenues in the satellite launches?

Hey, Rick. This is Shawn. So, we're starting to incur some of those as we speak but they're -- we've been trying to pace those somewhat with the launch. You can think of this quarter as maybe $5 million. As we get closer and closer to launch, like I said those will start to ramp up. So, maybe in the annual rate around 35 right, before we go into service is a good estimate.

$35 million on an annual basis?

Yes. So, kind of ramp up to that.

So, makes sense. And obviously, it's about a year from now that you get into service hopefully a little sooner. How are you guys feeling about maintaining flat revenue on the US consumer broadband side, given the demand from in-flight connectivity or should we expect some declines in the revenues on consumer broadband as we look into the future?

Hi Ric, it's Mark. Yes. So far, what we've seen is kind of the ARPU growth has maintained pretty much the same pace and actually in some cases a little bit better than the sub decline. And that -- I think that's also kind of consistent with what's going on in the industry. So, we think that's more or less kind of the trend that we'd expect between now and entering service in the US.

Okay. And we saw some announcements. It looks like on the competitive front space like Starlink is starting to pivot to some more business enterprise with $500 plans, $2500 CPE costs. How are you thinking about the competitive dynamics out there as far as your ability to grow with ViaSat-3 is in the air?

Well, a few things. One it's a very big market. We have seen so far sort of I'd say de minimis and immaterial impact in the overall markets, due to space to where you can see that they're out there. But one of the points that we've made, and I think that this is turning out to be true is that the better the services the more value you can offer as a function of price the bigger the market is. And so what's happening is you've seen the market. We're seeing the market grow, and I think we're still getting a share of that market that's sufficient for our growth targets. The other point I would say is, if you look at what we're doing on the enterprise side, we tend to be a lot more vertically integrated into each specific market where there's quite a bit of value add besides just providing a broadband pipe. And we think that's really a good fit for us. So the types of plans that they're describing will – they're sort of interesting, but we don't really see them having any impact on our forward-looking outlook?

Great. Thanks everyone. Stay well.

Thank you. Our next question comes from Landon Park of Morgan Stanley. Please go ahead.

Thank you. Hello, everyone. A couple of questions, so could you talk about, your conversations that you've had with The UK government over the last couple of weeks and maybe some of your takeaways from those? And what type of concessions or agreements you guys are thinking about as part of the deal?

Yeah. So when we announced the deal, we were actually ready to go a little earlier and they asked us to lay it. They had worked out what we call undertakings with the previous private equity group that had taken this thing private. And I'd say, the discussions we've had are fairly consistent with those types of things. There's not quite frankly, the plans that we have in The UK in my view are quite a bit more favorable to The UK than what's going on and we're more vertically integrated. We'll bring more R&D. I think the types of people we hired will be more technical people. So I think, we just have a really positive story. And you've read the things in the newspaper what they're worried about. And I just – I don't think we have that situation. Not every deal is the same. And so those have been the discussions just talking about what our plans are. And I think the discussions have gone really well. There were some articles that came out by the same three people that previously written about in a very negative way, and the new articles are much more balanced. So I think that we've got a good story. We've been in the UK for 10 years – over 10 years. We have data at rest – security products over there that, we provide today that actually provides most of the data at rest security products over there that we provide today that actually provides most of the data rest security across their MOD. We've previously announced a satellite operation center investment in the UK prior to this deal even getting signed. And so we have a very good story and they seem to be pretty receptive.

And is the deal going to be subject to the new national security oversight law that recently went into place?

It is yes. So we expect a full review across the board on all. That's what we expected going in.

So moving on to the broadband business. There's been some news that Facebook is going to be sort of winding down some of their – or I think most of their international Wi-Fi Express business. They had partnered with you in Mexico. Could you maybe just talk about any impacts that might have on you? And maybe just a broader update on that international Wi-Fi program you guys have been running? And what type of returns you've been able to see out of that business?

I'm sorry, I missed the very first sense that about the company that you mentioned.

Facebook.

Facebook.

Oh. Okay. Yeah. So our -- no, on the international front in terms of fixed services we have two sets of initiatives. One is, direct residential broadband that we're doing in several countries since acquired in Europe, the other part of the joint venture we have with Eutelsat. And the other part which is the part that -- I think you're referring to are the, what we call community Internet or shared Internet services. And we're doing that in a few different ways. The main common element is to bring bandwidth in by satellite to some central point and then distribute that bandwidth to end users. And we're doing that actually in multiple different ways. We're doing it via land. We're doing it via wireless. We're doing it by unlicensed Wi-Fi and each of those -- we think that each of those will have places under different circumstances. But right now all three modes of delivery are I think are growing and are attractive to under different circumstances. On the Facebook thing specifically, we're working with those guys right now on transitioning that, so we don't see any impact.

Yeah. And look, if you remember that the other part of it is …

Facebook.

…our -- what we're doing with Facebook was more about trying to understand where to deliver service and how effective that service was. And I think that that activity has been benefiting both companies.

Great. And the last one for me, just on the commercial network side can you talk about some of the managed services that you guys expect to ramp up in that business over the next couple of years? And maybe what that -- the margin profile looks like for some of that and the prospects to get that segment closer to breakeven?

Okay. So, on the communications network side, I'm going to unpack that a little bit. So from a managed services perspective the main thing that we've been doing there is in, what we call real-time earth. Is that where -- so that is a shared network services business primarily for Earth observation downlinks -- data downlinks. Is that what you're referring to?

Yeah, that is what I'm referring to.

Yeah. So that's still a relatively small business. But it's growing pretty steadily. And right now what we've been doing is working primarily with third-party partners versus we did one with indigenous people in Australia. We just recently did one in Ghana. And we have more opportunities for that. And then the other kind of really -- the two other really interesting elements of that what are the main businesses in our communication network, that's accounted for a lot of growth for us is building kind of the largest most capable full motion ground antenna systems. And the reason that's valuable is a very large antenna just a lot more efficient at getting high-speed data down. So, higher speed for the highest resolution sensor data. And then, the other one is that that makes them most effective for, this new generation of very, very small satellites. So you don't need a lot of power sophistication. From the space path you can focus most of your value on the sensing part. So those two things are really valuable. And then the other thing that we're working to integrate with that is I think it is LEO to GEO relay which is a very unique mission that ViaSat-3 constellation can do because of the global coverage in the high capacity. So right now they're small businesses. They're good margin businesses. And we think that is -- the variable costs are low. So, as they scale those margins will improve. On the overall issue of EBITDA -- turning that business EBITDA positive the main -- kind of the main thing that has been a drag on EBITDA is what we think is actually a benefit, which is we're doing our own payload designs for the Viasat satellite series. And we're also now extending some of those payload capabilities into third-party satellites like what area that's been good for us has been cross for satellites. And we have a number of government contracts. And now we have commercial contracts for cross-linking. We think that's a really attractive business. So the fact that we do that for both ourselves and others as opposed to just buying satellites like most other satellite operators do means that we expense the R&D as opposed to capitalizing the R&D that goes into these next-generation satellite designs. And that is the single biggest – I mean it's really the only factor in the negative EBITDA in that business.

Yes. Landon, this is Shawn. Just to add it right? We – most of our R&D, we centralize in that segment, right? It benefits across the segment which have most inflows there. So outside of that it's a nicely profitable segment for us.

No, I was just trying to understand if on a reported basis, if there was a path over the next three years or so to get it closer to breakeven?

Yes. I mean I think we're – I think we'll see improvements in that. We're going to continue to have good momentum in ISE and delivery of terminals there but we're going to continue to invest as well for NextGen and things that we think are very valuable in commercial applications as well as government.

And R&D at 5% of revenues is still a good quarter...

Yes. This quarter we were about 5.2%. So 5%, 5.5% somewhere between or a good estimate.

Great. Thanks, everyone for the call.

Thanks, Landon.

Thank you. Our next question comes from Mathieu Robillard of Barclays. Your line is open.

Hi. Good afternoon and thank you very much. I have three questions, please. The first one relates to the Inmarsat acquisition. You were mentioning in your scripted remarks that you've engaged with clients and clients are asking about what this could mean and what kind of services maybe you can provide. Could you give us a little bit more color in terms of what is their interest focused on in a combined Inmarsat Viasat proposition?

Sure. Yes. So the main things that we've been focused on – and these are I'd say these are common among a lot of the mobility businesses. Number one is, there's an issue about bandwidth density, which is how do you avoid congestion in your network so that our mobility customers get – had a reliable service even when they go into busy airports or hubs. And one of the things we showed, we thought was one of the most important slides in our presentation about the Inmarsat acquisition was just the density of demand for commercial air and commercial air is relatively easy to show because it's scheduled airlines. But similar situations occur in things like general aviation, maritime and other – and even in land mobile applications. So that – one of the things that's really been an important factor for Viasat's growth has been our ability to deal with that, especially in the US, which is the largest domestic market for air travel. And if you look at the large airlines that we serve in the large airport cities I think we've been able to demonstrate our ability to keep ahead of that issue. So that's one. The another one that I think people are really interested in and especially in maritime and in some of the intercontinental aviation is the hybrid services between Ku-band and L-Band and being able to provide that continuity of service even under the worst weather conditions, which is where when you think of airline safety or maritime safety, where a lot of the most stressful situations are associated with bad weather. So that's being able to bundle those things into attractive systems is a really good thing. And then the other, which has been kind of the main thing that airlines have been looking to ViaSat-4 that we believe Inmarsat really accelerates is redundant global coverage. And so we'll get there faster and we'll have multiple satellites and sort of those long haul international routes. I'd say, those are some of the main topics that customers have come to us to discuss first.

And is that -- if I can follow up is that also a discussion, you're having with governments that may require more capacity?

Well, yes, if you look at -- I mean one of the things that's also been a valuable business for us as well as for Inmarsat is in dealing with government applications. And the big thing with government applications is, they don't really know where their [Indiscernible] will be. They can anticipate but they can pop up anywhere in the world. And when they do, they also have this issue about very large amounts of demand concentrated in relatively small geographic areas. So being able to deal with those issues, and being able to deal with some of the unique things that we bring for instance with ViaSat-3 are potential to deliver uplink speeds from platforms that are exceptionally good, much better than even a lot of these new NGSO systems. So those are -- they are just the attractions of the combined resources and capabilities of the companies.

Thank you. If I continue on the government and specifically service revenues, which kind of links a bit to what we just discussed. I realize service revenues and bandwidth demand for you today in Government Services, is a small part of your revenues, but I was wondering if you see any increase in demand recently obviously, slightly more tense geopolitical situation? And whether in the past you've seen big increases in demand linked to any deterioration on that front?

Yes. So I mean, I think, all satellite operators tend to see increased demand for government bandwidth when there are conference in the world. So we're not -- if you have bandwidth in the places where it's needed then you're in a position to be able to help support that. I think more recently, there's threats of conflict. It doesn't come out -- turn out to be that way. So right now, we're just really seeing more, I'd say, inquiries about more around planning and contingency planning, what can be done. I think we're -- I think as we've grown, I think we're in a position to be able to deliver more support. In general though, some places demand has gone down and it will probably appear in new places if it does.

Overall satellites -- not satellites but services portion of our government revenue has been growing over the last few years.

Yes. I think we've talked about that being in the 20% to 25% range of total services Government Systems revenue.

Great. Thanks. And if I finish with one question on the US broadband market. So you do mention in your press release that the number of subscribers has come down a bit but that's kind of voluntary to some extent as you want to use more capacity in IFC. But I had a broader question concerning the market and the competition there, because some of the telecom players are pushing a lot more it seems FWA solutions, as a way to increase their revenues. And I was wondering, if you saw that as potentially, a new source of competition a reduction of your potential addressable market in the US? Thank you.

No, we don't -- it turns out fixed wireless has not really been a material factor in changing the market for satellite broadband in the US. There are other factors. I mean so cable edge-outs, fiber -- new fiber builds those are probably more of a factor. And then the other one, I think, kind of ebbs and flows depending on the economy demand and a couple of other factors is people just using their mobile service plan as their own broadband service. And that becomes a little more tenable for people when they have when they're going to the office and they have broadband resources that work or somewhere other than home. But those are the main factors. And that's how -- what we see probably shaping the market. Over the next few years we've done a pretty detailed micro analysis of that on a region-by-region basis. And we think it will eat into the market, but it's not going to eliminate the market. There's -- what we've expected over the next five years, we talked about this a few times it's kind of modest growth on a subscriber basis in the US between now and say 2025.

Great. Thank you very much.

Thank you.

Thank you. Our next question comes from Chris Quilty of Quilty Analytics. Your line is open.

Thanks. I had a question about the forgotten acquisition maybe with RigNet. We haven't talked about it in a lot of detail but can you give us maybe a status update now that you've had it a couple of quarters under your belt of what you're seeing in that business in terms of both business operations integration cost reductions and I guess putting Inmarsat aside for a moment because there's a lot of changes that could come. But like what plans do you have now for that business in terms of growing it and migrating it with the ViaSat-3 services?

Yes. So, the integration has gone very well between the two groups. There was some initial cost reductions that took place early on. We've been working on the integration the business areas have become our global operations have all been integrated under one group. So, that's gone well. We have started our initial first Ka-band deployment in some of the rigs where they were previously leasing capacity, but that's just at the very beginning. It's just started with some trials. That's obviously one of the big benefits here to both drive performance and helping the cost profile overtime. That will improve as we began to launch these ViaSat-3 satellites. That's where the real growth opportunity there is. And the Intelie part of that business has been a very positive surprise really strong team has a good platform. They continue to win new business and we're there's other applications across Viasat where that group can help. So, we're -- I'd say things are about as expected so far.

Got you. And a question on the Ka-band rollout on the rigs. There was probably some reason in the past why RigNet was hesitant to use Inmarsat as the backup but have you determined what the backup path will be there for those systems?

So, yes, one of the things we're not doing is disclosing our execution strategy to the competition. So, one of the things we're doing in these trials is demonstrating what's capable. And so our view is that you give a whole bunch of people a whole much more bandwidth and charge them a lot less is you create things that they would have done had they been able to do and work. And so we're able to do that in areas where we have a footprint right now which is limited. As those satellites roll out and then with Inmarsat, we won't be limited to that. And so we'll be able to do that across the board. So, the real opportunity here is growing the type of services we deliver to all these platforms.

Understand. Different question. Mark you mentioned cross-links. I assume you were referring to RF and not optical cross-links?

Yes. Correct.

Okay. Can you name any of the programs where you're targeting business because I'm not aware of any off hand at least unclassified?

Well, the largest commercial one that we had is Iridium. So, we did all of the onboard -- remember Iridium is our cross-linked system. So, we did all of the onboard cross-links for Iridium. We have mostly otherwise so far have been mostly government programs including -- I don't really want to name them, but some name brand new multi-satellite government programs we will be -- we've been funded. And I think we'll be in the production version of those satellites as well. And the crosslinks that we've been doing are generally Ka-band or much higher frequencies that have a lot more capacity. I think one of the most interesting ones where we are getting traction as well in both government and commercial programs is in the LEO to GEO crosslinks which is a pretty unique capability. But the big advantage there if you have a very high capacity global system like ViaSat-3, you can just insert the LEO crosslinks into the global coverage capability of ViaSat-3. So that's a really, really interesting opportunity and we're getting good traction on that on both government and commercial sides.

Got you. And the sort of high-profile government name is that perhaps a new effort with a generic sounding dumb name and very high volume where the primary focus is on optical?

No. There's certainly a place for optical propylene. The big advantage of RF crosslinks and let's say, RF is kind of interesting in the gigabit, up to the gigabit range and you may see optical crosslinks in the 10 or more gigabit range. But if gigabit is a worthwhile bandwidth, the big advantage of optical is much -- or much less power doesn't require the platform stability, you can network it so you can hop the links around a lot easier to make in great connections, build packet networks. So there's -- I know there's a lot of focus on laser crosslinks, but the optical one is a really interesting market and one that -- I think we are -- I mean sorry the RF is really interesting and it's one where I think we have a really good competitive position.

Because I didn't ask Shawn any questions, I'm going to follow up with one financial question which is, when you were mentioning with Rick earlier the ground equipment costs are those capitalized costs now, or are those costs that you are expanding?

Chris, what I was trying to capture for you guys is how the OpEx will ramp ahead of the service launch that's not the CapEx.

Okay. And you're not, again not able to capitalize any of the ground equipment R&D and build out until the satellite is operational?

No. It's part of the full project profile that we've given you guys which includes the satellite, the launch, the insurance, all the initial ground. That stuff is capitalized. It's just the operating when you line it up essentially that gets expense.

Equivalent power and fiber optics and rent and all of those types of expenses.

Great. And I know you haven't given out a specific number. But then do you use the term gateway or no? What the name you use for your...

Gateways.

Yes. Okay. What percent of those are installed now? And do you light them up and keep them lit up until ViaSat-3 is launched, or do you kind of light them up and turn them off just to test them?

So we probably have close to half of the initial set of sats in the US

Coming over the next few months.

Yes. Somewhere in that range is what will happen. One of the things Rick mentioned is that things are going well on space ground testing. We're able to test a lot of the integration using the new ground network in one of our existing satellites. We think that's a lot of functionality. So what we are doing is, we're lighting up some of them along the way to increase the scope of that testing. But the bulk of them will be activated very close to the launch or post launch.

And final question for Shawn. I think the last number you gave was $2.3 billion for the ViaSat-3 program just a clarification. Does that include capitalized interest or not?

That is without the capitalized interest about that range.

Okay. Perfect. Thank you.

Thanks Chris.

Thank you. Our next question comes from Louie DiPalma of William Blair. Your line is open.

Good afternoon, Rick, Mark and Shawn.

Good afternoon.

I was wondering, does the U.K. government have any interest in investing in the Viasat Inmarsat combination in the same way that they invested $500 million into OneWeb?

We haven't had that discussion. I think, OneWeb was having those discussions. I'd say that's the big difference is, they were looking for investors. I don't think the U.K. government is probably interested in investing in a public company.

Okay. That makes sense. And switching to ViaSat-3, I was wondering what is your degree of confidence that you will have ViaSat-3 services commencing for either consumer broadband or aviation this year?

I would say pretty good. I mean, we have a plan that does that, but there's uncertainties along the way. I wish we could be certain, but we can't be certain. I think, we have a plan. But if you look at sort of the main thing that caused the launch schedule, it was the lack of availability of specific people who have been able to forecast that three months ago things looked like COVID stuff was going away and life was coming back to normal. So I wish I could tell you we are certain that we have a plan. Generally, we've been pretty good at executing plans when the assumptions behind them hold true.

Okay. Thanks. Thanks, Mark. And for the customer premise equipment and the terminals associated with the ViaSat-3 system, how will the economics be different for new customers that want to use the ViaSat-3 system versus existing customers that are currently on ViaSat-1 or ViaSat-2 that are looking to upgrade? And the reason I'm asking is a lot has been made about how like SpaceX with Starlink takes a pretty hefty loss on their terminals. And I'm wondering, like how does that loss compared to the economics for your geostationary type terminals?

Okay. So one is the ViaSat-3, overall economics I think will be in line with what we've experienced since we did ViaSat-1, which is, think of it as customer lifetime value compared to customer acquisition cost, lifetime, it tends to be 3x somewhere in that range right about a lifetime value. And that's based on many, many years of good understanding of customer acquisition cost, churn statistics, ongoing customer support. And I think we have some initiatives that actually reduce cost and can improve that. So we'll see similar things with ViaSat-3. It's kind of what we expect. So the -- and the thing I would say that maybe doesn't get as much attention as it probably should, from investors to think about is, really there's kind of the biggest issue in running these businesses to deliver an attractive service into do it profitably is the amortized airtime costs. And so what -- if you think about it and this is kind of what we said in the past is there's kind of a rule of thumb of think of bandwidth and space is inventory and you're seeing that right now right? Whether -- it doesn't matter if it's GEO or LEO, if you don't have enough bandwidth and you add more customers or you're seeing customers use more bandwidth, speeds can drop and that's exactly what you're seeing. For instance, in the LEO world the speeds are dropping and you don't add more bandwidth and the customers you already have use more bandwidth, even if you don't add any new ones. So what we think about is, when we bring out these systems that have big improvements in the airtime economics well we tend to value the bandwidth on all of our systems at the lower of cost or market right? That's kind of the way that you tend to think about bandwidth. So we can offer -- we'll be able to offer a lot of the same services that we do on ViaSat-3 on the older satellites. They're capable of doing it. They don't -- you don't have to necessarily switch satellite or get new CPE to be able to get the new services. That's kind of what -- that's the payoff of that. And that helps us to preserve this kind of ratio of life time value to customer acquisition costs. Does that answer your question?

Yes. Great. Thanks, Mark. Thanks, Rick.

Sure.

That’s it.

Thanks, Louie.

Thank you. Our next question comes from Ryan Koontz of Needham & Company. Your line is open.

Thanks for question. On the Delta IFC business it sounds like that's really humming here. When do you expect that to peak on the commercial side as you kind of penetrate the fleet there? Any outlook on time line?

So we're a little over halfway through the build-out of the current backlog with Delta. And so we're still ramping there. And there are -- there's a lot of other activity I'd say in the commercial air marketplace.

So a fraction of our -- if you look at the number of new planes that we have on order that we described in the letter Delta is less than half that.

Well, under half. Yes. So -- and it's not it has been we don't expect it to stop. There's just a lot of new interest.

Got it. And just a housekeeping question here on the acquisition expense popping up in the quarter there. Do you expect that to stay pretty steady into the close of the deal and kind of ramp post integration of Inmarsat?

No. Right upfront was pretty heavy on the expense side. We are still running -- we're still spending money. There's definitely lawyers still working on regulatory filings and they can spend money for sure. But it's not at the rate it was in the December quarter.

Okay. That’s it.

Thanks, Ryan.

Okay. I think that's the last question. So I just want to say operator thank you and thanks to everybody together with Mark and kind of the rest of the team here we want to thank you guys for spending some time with us. Hopefully you found the letter informative and your continued feedback on that back to peak is helpful makes it -- continue to make it better for trying to answer your questions next time. Our operational momentum is still really positive. We're excited about the capabilities and opportunities that Inmarsat will bring. We think they have got a strong team and their performance has been excellent over the same period. But at the same time, we're focused on what we're doing. We're focused on our execution. Our leadership team and our employees are really focused on executing our plan. So again don't hesitate to reach out to Peter with input or other questions you've got. We look forward to following up with you guys. Thanks.

And this concludes today's conference call. Thank you for participating. You may now disconnect.