APi Group Corporation (CARR) Earnings Call Transcript & Summary

Good morning, ladies and gentlemen, and welcome to the APi Group acquisition of Chubb and fire security business (sic) [ Chubb fire and security business ] call. [Operator Instructions] Please note this call is being recorded. [Operator Instructions] I will now turn the call over to Olivia Walton, Vice President of Investor Relations at APi Group. Please go ahead.

Thank you. Good morning, everyone, and thank you for taking the time to join our call this morning to discuss our acquisition of Chubb fire and security business. We're excited to tell you about the opportunity. Joining me on the call today are: Sir Martin Franklin and Jim Lillie, our Board Co-Chairs; and Russ Becker, our President and CEO. As a reminder, we've posted a presentation detailing the acquisition opportunity on the Investor Relations page of our website. I will now turn it over to Russ.

Thank you, Olivia, and good morning, everybody. We appreciate you taking the time to join the call. I'd like to apologize upfront to everyone. We know that today, especially, is a busy time with a number of other earnings calls happening simultaneously. This was a competitive process, and the timing wasn't necessarily 100% in our control. However, we are super excited to share the details of this transaction with all of you. As Olivia mentioned, joining me on the call today are APi's co-Chairmen, Sir Martin Franklin and Jim Lillie. And to kick us off, I'll pass it over to Martin, who will walk through the executive summary and the transaction overview. Martin?

Thank you, Russ, and good morning, everyone. We're delighted to announce that we have entered into a definitive agreement to acquire Chubb fire and security group from Carrier Global Corporation for approximately $3.1 billion: $2.9 billion in cash; and approximately $200 million of assumed liabilities and other adjustments. This transformative acquisition takes APi from a U.S.-centric leader in its niche to the global leader in life safety services. The addition of Chubb to our portfolio effectively doubles the size of our existing life safety business and further builds on the competitive moat we recognized in APi when we acquired the business in 2019. This transaction enhances our recurring revenue profile in statutorily-mandated services and further increases the group's overall service mix. Chubb is the market leader in its markets, including France, U.K., Australia, Canada, Hong Kong and Benelux. We believe that these new regions perfectly complement our portfolio and extend the reach of APi's platform. Now to Slide 7. We expect this transaction to be funded with a mix of cash on hand, new equity and debt financing as well as a perpetual convertible preferred investment of $800 million by our partners at Blackstone Group and Viking Global. We have received fully committed financing and are targeting net leverage at closing of approximately 4.25x, which we expect to delever rather quickly given the cash flow nature of the business. The transaction is expected to be immediately accretive to earnings before synergies, which we anticipate to be greater than $20 million, excluding any revenue synergies. Carrier is completing an internal restructuring to carve out the Chubb business from its existing operation, and this, along with customary regulatory filings will determine the closing date for the transaction, which we expect to be around year-end. We have already started planning our integration plan to take advantage of the best that both APi and Chubb have to offer. We look forward to providing more details on this once the transaction has closed. On Slide 8. As I alluded to my -- in my opening remarks, the strategic rationale here is fairly straightforward. We are acquiring an internationally-recognized brand that has achieved enormous success over a long period of time. The transaction transforms APi into the world's leading life safety business. The combined entity will be asset-light, maintain low CapEx and exhibit high free cash flow conversion. We are enhancing our service business mix while capitalizing on cross-selling opportunities and synergies. In our work, we recognized an attractive opportunity to amplify our organic growth and achieve meaningful margin expansion over the long term. This transaction is highly accretive and a unique opportunity to combine our independent successful businesses into a truly global leader -- market leader. When we acquired APi, we were clear in our strategic rationale. It fit the acquisition model that we embraced at Jarden and manifested in our acquisition of Chubb. The business is a leader in their top geographies, generates significant free cash flow has experienced -- and has an experienced management team, strong recurring revenue profile and is value accretive to APi. I'll now hand the call back to Russ.

Great. Thank you, Martin. On Slide 11, please. I'm going to walk you through the Chubb business, which we have been following for quite some time. and believe that it adds material strategic value to our operating platform. This transaction transforms our business into the world's leading global safety services provider. This is the beginning of what is going to be an exciting next chapter for APi and the combined Chubb team. We are excited for this challenge. Now let me walk you through the Chubb business and what got us so excited about their company. Chubb has a 200-plus-year history of working with a premier and diverse set of customers. They are a full service provider of life safety and security services. The company operates in 17 countries, serves over 1.5 million customer sites and has over 13,000 employees. Chubb is the market leader in the primary geographies that they serve. Their top 6 markets comprised of 90% of their revenue. We know that our most important assets go home every night, and we are excited to welcome all leaders in the Chubb family into the APi organization. Moving to Slide 12. Chubb offers similar operations to us. Their primary business is in their security services and life safety operations. Chubb offers a best-in-breed end-to-end service with installation, monitoring and service components. They are a product-agnostic platform that leverages best-in-class technology in order to meet their customers' needs. Their integrated security solutions along with their fire protection and detection and alarm systems make up an impressive portfolio of solutions that we are excited to build upon. That's a nice segue to our next slide discussing the predictable revenue stream that derives from Chubb's end-to-end business model. So on Slide 13. Chubb's business centers around design and installation, service and maintenance and monitoring. This suite of solution comprises their best-in-class end-to-end business model. They leverage experienced technicians to lock in multiyear service contracts, ultimately providing a best-in-breed solution to their customers. This provides a high degree of revenue visibility to the business. Now I will turn it over to Jim to walk through the business combination. Jim?

Thanks, Russ. Good morning, everyone. We are excited to be speaking with you all today to share this strategic opportunity. This transformative deal creates a leading global safety services platform. When we initially invested in APi, this is exactly what we had hoped to find. I want to emphasize the global aspect of this opportunity. APi has consistently demonstrated their ability to execute domestically, and Chubb's complementary international commercial operations provide meaningful cross-selling opportunities in the combined business. We're so fortunate to find an organization like Chubb to help accelerate our expansion into key international geographies. Slide 16. I'd like to call out the mix shift in APi's pro forma business. Through this transaction, we are diversifying the end markets that we serve, the geographies in which we operate, expanding our exciting safety services business as well as amplifying our focus in the services business. We will have over 25,000 combined employees with an incredibly exciting pipeline to execute on. We're ready for this challenge, and are excited for the opportunity. Slide 17. Here I'll focus on the organic growth potential that this business combination offers. Through our diligence, we identified numerous ways in which we believe we can add value to Chubb and learn from Chubb's historic success. Most importantly, we identified functions that we believe we can collectively benefit from. Expanding their margins, cross-selling existing products volume and pricing increases and more represents just a subset of the identified opportunities that we believe we can capitalize on through this transaction. These will ultimately lead to meaningful increases in both our top and bottom line performances. Slide 18, please. In summary, this transaction presents exciting opportunities that support our compelling investment thesis. This transaction marks APi's transformation into a truly global enterprise with leading services capabilities. As we did with Jarden, we are acquiring market-leading businesses in niche markets and believe there is significant opportunity for improvements. The organic growth and margin opportunity is very clear. We are enhancing our services business mix and expanding on our recurring revenue-based business model. This highly accretive transaction creates a pro forma business with very attractive cash flow generation and very low CapEx. On Slide 19, beyond our key investment criteria, we've identified several additional value levers we believe will create significant value in the long term. First, we are excited to embrace Chubb's corporate values and believe APi's focus on its most important assets, its employees, will create an exciting best-in-breed values-driven company. We're enthusiastic to invest behind the Chubb team and support their operations and supplement them with our existing operations. In addition, we're excited to add Blackstone as a partner. As many of you know, Blackstone has a significant global property portfolio, which we expect to provide the buying company the opportunity to open new customer opportunities in multiple markets. Blackstone's real estate total commercial portfolio is comprised of over 1.2 billion square feet of real estate globally, and we're excited to compete for their business. Lastly, our near-term focus will be on deleveraging. As Martin mentioned, both businesses generate significant free cash flow. We believe that the low CapEx, high cash flow generative business will be helpful in that initiative. In sum, the opportunity provides meaningful commercial opportunity, and we're grateful to be partnering with such an impressive company. Chubb is a historic, internationally-recognized brand that is trusted by its customers, and we're excited to learn and share in the combination of our 2 businesses. Thank you all for again attending this meeting on short notice. We do have some time, so we will open it up for questions, if anybody would like to line up in the queue.

[Operator Instructions] And our first question comes from Kathryn Thompson from Thompson Research.

Just in terms of leverage, maybe give an update where we are. And then also importantly, if you could focus on your free cash flow metrics conversion and how does that stair step into your deleveraging trajectory?

Russ, do you want me to...

No, I can do it. So Kathryn, we're -- right now, we're sitting like 1.8 from a leverage perspective. And as Martin said in his remarks, on the closing of the transaction, we expect to be right around 4.25x. Their cash flow conversion is roughly 90% if you look at adjusted EBITDA less CapEx divided by adjusted EBITDA. So their cash flow conversion is very, very similar to ours. And we see -- in our models, we see the business very, very quickly delevering over the course of the next couple of years to 3 and below. So we feel really good about the cash generation capabilities of this business. It's very, very similar to APi and to what we would expect to see in the everyday course of our company.

Okay. And then following up just on the core business. Maybe give some thoughts in terms of what their EBITDA growth had been. But understanding though, it appears that this has been a bit of an orphan asset at least from my perspective. And within Carrier, where are their core margins today? And I know that there's -- I said that there's upside, but what are the categories? What does upside look like, both from a number standpoint, but practically, how do you get there? What are the levers you can turn?

Yes. Again, I go back to -- this is very, very similar to us. So there their core margins right now are sitting just below 10% on an adjusted basis. And when we look at their business, number one, we saw a tremendous amount of upside from a margin expansion perspective. And there's a lot of -- a lot of the levers are very similar, like taking advantage of scale and standing up a true procurement department. That's something that we're going to be able to leverage the combined entity with now, continuing to improve their mix. They have -- roughly 52% of their revenue, maybe 53% of their revenue is considered service. They've got 9% that's monitoring and roughly 38% is installation, but continuing to improve their mix is another area of opportunity for us. There's opportunity to improve the overall performance in a number of different regions in their business as it relates to potentially consolidating real estate and other opportunities that we've identified within the context of the business. So there's -- many of the levers, Kathryn, that we'll be pulling, so to speak, in APi's core business are going to be the same levers that we're going to continue to be looking to pull in their business. And we really truly do believe that their margin expansion opportunities line up very well with the margin expansion opportunities that we've identified to the investment community. So do we think that 13% by 2025 is realistic? We do.

Kathryn, it's Jim. I would also add -- because there's probably Chubb employees listening to this call. I just want to point out that we bought the business to grow it. We intend to invest it as permanent owners, people who view this business as core to our business. We know that -- and this isn't meant to be a negative, but when part of UTC and then part of Carrier, Carrier sold the business because it wasn't strategic to their core. It's strategic to our core. And so we see a lot of opportunities for cross-selling, adding their products into our mix of products, just like we did when we acquired SK about a year ago. If you recall, SK had a defibrillator servicing business, which we didn't have in North America, and so we saw opportunities there. So we're really excited. We think the margin expansion opportunity comes through cross-selling, pricing expansion into new geographies and other areas. And so we couldn't be happier with the opportunity in welcoming the Chubb family to the APi family.

And our next question comes from Andy Wittmann from Baird.

I have a few questions here. I guess maybe I want to start out with just a little bit more context. I mean we've got historical filings from Carrier to give us a little bit of detail here, but this is a little bit of a carve-out. I guess I'd be curious to understand at the EBITDA and revenues were for the part of the business that you're buying in 2019 pre-COVID? I guess it's just -- the question comes in the context of -- that you're paying a 13.3% trailing multiple after synergies, obviously well above the target range for the smaller deals that you guys talked about. And so I want to understand how much of the elevated multiple versus some of the multiple ranges that you've targeted in the past is just from a COVID LTM versus what you think the underlying real earnings power might be in a more normalized world?

Well, Andy, the revenue and EBITDA for this business has been relatively flat over the course of the last 3 years. Actually, it probably peaked in 2018. And so as we look at this, we're looking at it more from a strategic purpose. And really, this acquisition establishes us as a global player. This is not a transaction you were going to get accomplished at, say, the traditional tuck-in level that APi has continued to execute at. So when we look at this and we look at it over the course of the next couple of years as we continue to drive growth in the business and improvements in the business, we see the average multiple for the fleet continuing to be much more reasonable from that perspective.

Got it. Okay. And then just in terms of -- you touched on it there, Russ, a little bit, the growth rate. I guess, first question is, you've had all these targets about your growth rate kind of organically a 12% margin by 23, 13% by 25. You already kind of said that you still believe you can achieve those. Do you think that the growth rate in this business with the opportunities that you look like can keep you with your -- does your targeted growth rate change as a result of this business that you're acquiring? I guess that's the question. Or any of those other long-term targets. Just want to hear your kind of comments on that so we're on the same page.

Well, in our modeling, right now, we've been really conservative in how we're looking at the top, say, the top line growth inside Chubb, if you will. And they've got their own models, and they've got their own margin expansion goals that they've been working on that are 100% in line with what our margin expansion goals are. So when we talk about 13% by 2025, their internal goals and hurdles have already been established and are 100% in alignment with us. And that's one of the reasons that we have really great confidence that this is going to really be accretive. If you look through some of the information, you'll see that from an EPS perspective, this is like $0.35 accretion and additive to where APi is at today, if you look at it on our 2020 numbers. So we look at this as a great opportunity to complement our business. And like when I first started digging into this transaction, I really truly feel like this is a 1 plus 1 equals 3 scenario, and as we continue to go to work, it would only be my hope that we can continue to improve on the expectations that we've laid out.

Great. And then just final...

Andy, it's Jim. If I could just supplement this. The other parallel between the Chubb business and the APi business, and you've heard us talk about this. At APi in our life safety businesses, we have we have businesses that are doing certain things that are driving 20% plus EBITDA margins, which means we also have businesses that are doing below the fleet average. The same is true at Chubb. Russ talked about the immediate accretion, and there's lots of regions of the world that are contributing significantly. This is probably 26%, 27% accretive out of the box. And -- but the business had lacked investment opportunities as UTC has reshuffled its assets and Carrier is focusing on its core manufacturing business. And so we want to make sure that we're putting investment dollars in the regions that have the higher margins and that we go in and look at what we can do to improve the businesses from our margin expansion where they're below fleet average. And it's no different than how we're looking at APi today. I'd like to say not all your kids are healthy on a given day. Someone has to take out the garbage even when it's not their turn, but ultimately, everybody is taking out the garbage. And so we're going to focus on the opportunities to make those that aren't as healthy healthier, and we're going to rely on those that are doing well to do even better.

Got it. That's helpful. And just kind of a technical question to finish up here for me, at least. The $800 million perpetual preferred equity. Could you give us some detail on the dividend rate that's associated with that? I guess you say it's perpetual, so it's not callable or putable, I would imagine. But any detail around that piece of the capital structure would be helpful as well as maybe a little comment on the assumed liabilities. Is that mostly pension, I guess, would be the question there. Is that an unfunded pension liability? Or what is that $200 million?

Yes, so our other co-chain will answer that since he spent a lot of [indiscernible].

I -- yes, I'll take that. This is Martin. So on the perpetual preferred, yes, it's an equity instrument. The dividend on it is 5.5% annually. It's a pick, but we -- the company has the right to pay it in cash if it chooses to. It's convertible at a 20% premium to the 15-day view up until the day from when we announced this transaction. And we have a force conversion rate at basically a 50% premium to the conversion price from that. So we think it's a very attractive piece of paper from our perspective, and it's obviously a good investment, we think, for Blackstone and for Viking. As you know, Viking are already our largest shareholders and we're very happy to be -- to participate along with it. But the history of this is Blackstone. It's no great secret that Blackstone had looked at Chubb themselves. They saw the value and the opportunity. And that ended up with us, if you like, teaming up a bit to look at this transaction together because between their opportunities to bring their real estate portfolio to become a customer in a number of additional properties, we saw that as a real synergy opportunity, which obviously is not in any of our numbers at this point. It was a win-win. And I think that Blackstone have a team of professionals, as you know, who could be very helpful. They've looked at this company for many, many months, saw the same opportunities to increase margins as we did. So that's their involvement. Your second question, remind me, was which?

Just on the detail on the $200 million of assumed liabilities. I was wondering if that's a pension liability or something else?

It's most -- the largest piece is pension. The pension is fully funded, but there are assumptions of -- on, if you like, transition costs related to that over time, but it's really a bucket of a number of things. The largest single one was pension -- but from our perspective, it's a headline price of $3.1 billion, but our real cash outlay for this transaction is actually $2.9 billion.

And our next question comes from Markus Mittermaier from UBS.

I joined a bit later. Forgive me if you already commented on that. Just thinking through sort of the different geographies. You previously sort of were, Russ, primarily sort of a U.S.-based company in the nose of the great margin accretion track record that you had there. Now if you think about the European business and the Asian business that you're taking on, is there anything different structurally in these markets that sort of would make it harder or easier to get to that 13% that you've mentioned earlier? And then maybe a brief follow-up as a second question to what Jim earlier said around investment retirement. How should we think about that over the next couple of years? So are there specific numbers that you have in mind already? Or any context there would be helpful.

Well, Markus, thanks for jumping on. I would start by saying that, again, reiterating the fact that the recipe is essentially the same, and when we look at the margins that they're achieving, say, on their installation work versus their service work versus their monitoring work, there's great alignment with APi's current business model. So I think there's just a lot of the same blocking and tackling is needed to -- in order -- for us to be successful in this business. Anthony Brennan, the current leader of the business, I think he really -- he sees the world through a very similar lens that we do as they try to continue to push the ownership down to the branch level and having -- bringing that entrepreneurial spirit back to the branch level. And that's very much the way we've built our life safety business at API. And so there's the -- when -- if you sat in the meetings and you listen to the dialogue about how we're going to improve the business, it's a very, very similar recipe. And -- the biggest difference is, obviously, is France is different than the U.S. and making sure that we have the right leadership in each of those key markets is going to be the biggest key to our long-term success. Does that make sense?

Yes, that's helpful. And then on the investments, any early thoughts there? I get that it's early days, though.

I don't know that I necessarily understand where you're coming from, Markus.

Jim mentioned in his remarks earlier, around investments in certain geographies, I guess, doubling down where margins are maybe a bit better. Any sort of more color there that you can share?

Well, what I was referring to is there are certain aspects of the business that could use some incremental IT spending. If you look at Hong Kong, a very successful region, can we accelerate growth by investing in incremental sales, talent and taking advantage of the momentum that business has? And so typically, when you have an asset that has held for sale, things kind of get paused a little bit. It's not a function of CapEx. They've spent the CapEx they needed to spend. But I think there's opportunities to invest in people, in geographies, in incremental product line and training associated with that. And so that was what I was referring to with regard to investments.

And our next question comes from Julian Mitchell from Barclays.

This is Trish on for Julian. So just maybe following up on certain liabilities. I was just wondering, I think that, that business that Carrier had historically had some AFFF kind of PFAS-type liabilities. Is that in any of those liabilities that you guys are assuming?

Martin, do you want to respond to that? Or the buckets that we've put things in?

I'm sorry, can you repeat the question?

Yes. I just think historically that business under Carrier and UTC had some AFFF kind of environmental liabilities with PFAS. I was just wondering if that's in any of the $200 million that you guys are assuming.

Yes, that is correct. And we've obviously analyzed all of that [indiscernible] the cost relating to it.

Okay. Great. And then I know you guys mentioned kind of improving the mix. But right now, are there any areas or regions or product lines, I don't know if you can talk through, but that might be non-core this business that you might think about perhaps being [indiscernible] best to reach your targets?

No, no, not at this stage of the game, Trish. I mean we like the business. We like the geographies and the markets they're in. And obviously, we still have a tremendous amount of work to do to really get to know the broader Chubb team. We've had exposure to, obviously, their leadership group and a number of the managing directors from a country level. But the work really starts now as we try to integrate the 2 families of employees and really start to get to know each other.

Just, Trish, to reiterate, we bought it to grow it. And so there's no thought process as we were moving through the acquisition and talking to the Carrier team and the Chubb teams about this asset. That hasn't happened. We're embracing the entire organization. We see a lot of opportunity with focused leadership, focused investment and cross-selling opportunities. And so that's our outlook. Obviously, at APi, we divested a couple of businesses a year or so ago. But I think if you look at this business and you look at the world of COVID, you see how the business has performed on a trailing 12 basis with about $215 million or so of EBITDA. I would say for most global businesses, COVID was the bottom. And so I think it's a baseline from which we can build on. And we know how the business -- like, we know how APi performed during COVID. And so my perception is with APi and with Chubb, you've seen kind of what the maximum headwinds can be and you go from there. So we're really excited about Anthony, the team, the various leaders across the business and all 13,000 employees of Chubb and bringing them in and welcoming and fostering their growth.

Great. And then just one last one for me. Do you guys have any target ROIC on this deal? Is kind of high single digit in year 5 a reasonable assumption?

Targeted what? I'm sorry.

The ROIC, return on invested capital on this deal?

I don't think we've discussed target ROIC.

[Operator Instructions] Our next question comes from Jon Tanwanteng from CJS Securities.

Congratulations on the agreement. My first one. Could you just talk a little bit more about the Blackstone partnership? Do you get preferential treatment across their portfolio? Or is this simply an introduction in a pure competitive process? Is there a lot of low-hanging fruit there to get business for both your companies?

Well, I mean, I'll let Martin supplement my response, Jon, to the question. But the way I look at it is that we have to earn their business. And I think that the way that I will move into this, as I communicate to our teams is that Blackstone will open the door and create opportunity for us, but we need to earn every opportunity that we get, and we need to work our tail end off to make sure that we deliver a superior result to them, just like we need to work our tail off to deliver a superior result to our customer. So Martin?

Yes. No, I completely agree with that. And -- but at the end of the day, on a jump ball, I'm sure things will -- the relationship, obviously, will make a difference. One of the things I wanted to go back to was a question that was asked earlier on PFAS. I think it's kind of important to explain. When UTC did their carve out from -- with a spin-off with Chubb, a lot of that liability stayed behind because we're not taking on any of the manufacturing operations. And so the assets that we're buying are largely to do with the service business. So any exposure to PFAS from our perspective is de minimis. So I just want to make sure that nobody thinks that we're taking on some open-ended liability as part of the transaction.

Got it. And then my second one. Can you just talk about your ability to drive further consolidation in the near term, especially leverage going above 4x? How aggressive will you be in pursuing tuck-ins with leverage at that level in the next year or so?

Well, I think, Jon, just to respond to that, obviously, we are going to make sure that we -- if we put our credit facility and we looked at our capital structure, we've made sure that we have adequate gunpowder for the right levels of tuck-in acquisitions as we continue to move forward. So we've made those considerations. We need to continue to be smart as we always are, as we continue to look at the companies that we're going to continue to look and acquire. Chubb has had very, very little M&A activity over the course of the last number of years. And obviously, we need to get to the point where -- kind of where we've stabilized and we're moving forward and things are functioning properly, but we -- just like when we acquired SK, they had a very strong bolt-on M&A strategy, and we think that we can continue to complement that strategy with Chubb. But we want to make sure that we have brought the right level of stability to the business and everybody is settled in, and we're moving forward together.

Got it. Russ, can you finally just talk a little bit more about the cultural fit and how you merge your distinct passion for [indiscernible] business -- excuse me, business and leadership training into the Chubb? I think you talked about pushing ownership down to the branch level. Is there a lot more work to do beyond that? And maybe is there anything that Chubb brings you from a best practice perspective?

So that pushing the ownership to the branch level -- I mean, now that's the way we've built our business at APi. And -- but that's also one of the first things that Anthony said and shared with us was one of the key tenets of his operational approach when he took over at Chubb. He's only been in the seat for 1.5 years. And they've had a lot of churn from a leadership perspective, and I think Anthony is bringing some stability to that current leadership. And if you -- if I go back to some of our initial conversations with Anthony and his team, they really had 4 kind of pillars that they were driving their strategy around. And one of those pillars is people and culture. And so that lines up really well with our focus and our growth around leadership development, and we think that there's a number of things that we're going to be able to bring to them that are -- that's going to allow them to start to invest in their people and help their people grow as individuals and leaders in their business. And so I mean, I think that when you look at it, and we're such a people-centered business, they're a people-centered business. And I don't care if you're from France, Canada, the U.S., you have -- people have a desire to be invested in. And I think that's something that we can bring to them because we've got a well-established leadership development program. We've been on our journey since 2003, and we've shared with you how that's helped us improve our results. And we believe that we're going to be able to relatively quickly start to stand that up in their business and help them.

Russ, I think that was the last question. Do you want to...

Great. Yes, I'd be happy to. And I just want to start by welcoming the Chubb family into the APi family. And we truly are very excited to have each and every one of you join our team. And I really believe that this is just the first step in a very, very exciting journey. I'm very excited for what we can accomplish together and the value that we're going to be able to deliver to our shareholders. Thank you to each and every one of you for not only joining the call this morning, but having the interest that you have in the company. And we really do appreciate that, and we're excited to show you what the future will hold. So I hope everybody has a great day today. Thank you.

Thanks, everybody.

Thanks, everyone.

This does conclude today's program. Thank you for your participation. You may disconnect at any time.