Petro-Canada 2009 Guidance Call Transcript

Petro-Canada (PCZ)

2009 Guidance Call

December 11, 2008 9:00 am ET

Executives

Ken Hall – Senior Director, Investor Relations

Ron Brenneman – President, CEO

Harry Roberts – Executive Vice President, CFO

Analysts

Robert Kessler – Simmons & Company

Terry Peters – Cannacord Adams

Ryan Todd – Duetsche Bank

Andrew Fairbanks – Merrill Lynch

Brian Dutton – Credit Suisse

Mark Polak – Scotia Capital

Mark Gilman – Benchmark Company

Andrew Potter – UBS Securities

Presentation

Operator

Welcome to Petro-Canada's 2009 outlook conference call. Please note today's comments contain forward-looking information so actual results may differ materially from expected results because of various risk factors. These factors are described in Petro-Canada's quarterly release and annual filings which are available on CDAR, EGAR, and the company's web site. I would now like to turn the meeting over to Mr. Ken Hall, Senior Director of Investor Relations.

Ken Hall

Good morning everyone and thanks for joining us. On the call this morning are our President and Chief Executive Officer Ron Brenneman and our Executive Vice President and Chief Financial Officer Harry Roberts. The format for our call will be that Ron and Harry will provide their perspectives and then we'll open up the lines for questions first to analysts and then the media. With that, I'll turn it over to Ron.

Ron Brenneman

Good morning. While this call is all about moving forward into 2009, I don't want to sell short the stellar results we achieved in 2008. We ran our operations well. We took advantage of a strong business environment and we advanced our growth projects. We'll continue to run our operations well in 2009 but the business environment is too volatile to count on with any degree of certainty.

As you can imagine, it's been very challenging to put together a capital budget that recognizes that uncertainty in the markets. The only prudent way to do that is to stay as flexible as possible until the situation becomes a little clearer for both the commodity and the financial markets. You'll see that's essentially what we've done and because we have the financial capacity to do so, we're well positioned to weather this storm.

We set our initial capital program at $4 billion for next year which is much lower than 2008 and down significantly from the $6 billion to $7 billion range that we were looking at for 2009 a year ago. I want to emphasize that this is our initial going in budget. We intend to monitor the situation very closely as the year progresses and adjust our CapEx accordingly. We have the flexibility to do that.

So let me explain what's behind our thinking here. First, you'll see that we're reducing spending across all of our businesses but we're doing this without losing opportunities or compromising on safety, reliability or short term production.

Second, we're pacing our growth projects to match our financial capacity. Instead of focusing on project schedules, we're taking advantage of the soft environment to reduce project cost. This is particularly the case on our three unsanctioned projects, Fort Hills, the MacKay River expansion and the Montreal Coker.

Starting with Fort Hills, as you know we announced last month that we're putting the up grader on hold and deferring a decision on the mine into 2009. Next year, we'll slow down our spending rate to about $350 million. That will allow us to bring the up grader engineering to a point where it can be put on the shelf for a possible restart sometime later. That's about $100 million of the $350 million.

It also allows us to direct our effort on the mine to getting the cost down before we make a final investment decision, and we're continuing to discuss the tenure of our mine lease with the province.

We're taking the same cost focus approach at the MacKay River expansion project. Although we still have a way to go, we're starting to see the engineering and construction tenders reflect the softening environment, so this will help us improve the project economics. This work, along with reliable operations that we're now seeing at MacKay River will provide the basis for a sanction decision early next year. If we get through sanction, we could see the first steam injection in 2011 and production in 2012.

The third unsanctioned project is the Coker at Montreal. The economics of the Coker still look attractive even with our outlook for narrower light-heavy spreads, but we think we can lower costs and improve them further, so once again, we're using this economic slowdown to rebid on supplies and contracts. Although it's still early in the process, we're seeing a good response.

The timing of this project will depend on settling the current labor dispute at the refinery and on how financial markets develop.

Our third course of action for our 2009 capital program is to use the liquidity and financial capacity we built up earlier in 2008. We'll target to cover most of our capital program with cash flow and be prepared to draw on our ample liquidity if need be. We intend to follow the business environment and financial markets through the year and adjust our spending as necessary. This is so we can comfortably see our way through the current volatility and uncertainty using our existing liquidity.

We have a strong balance sheet so we can take on debt if there are attractive opportunities when the markets open up. As always, we intend to remain financially conservative, but at the same time, keep building shareholder value.

Moving to upstream production, we expect production for this year to end up near the high end of our guidance of 400,000 to 420,000 barrels a day which is a great outcome in the $100 plus per barrel world that we enjoyed. For 2009, we expect volumes to be down 9% to 10%. This lower guidance is due to lower natural declines and shutdowns in our international and offshore business.

We're planning significant turnarounds at our three east coast platforms as well as at Buzzard. We're doing these scheduled turnarounds so we can maintain reliable operations and tie in facilities to higher production levels in the future. These turnarounds at our four largest facilities have an annualized impact of 15,000 barrels a day of deferred production. These volumes will come back on stream in last 2009 and will mean that we should exit the year closer to the high end of our guidance range.

As well, we expect to see additional production in 2010 from the North Amethyst extension at White Rose and Syria natural gas project. These projects should offset underlying declines across the company.

The other thing to remember is that while upstream production might be lower next year, the Edmonton Refinery conversion is in the process of starting up and should generate cash flow that will pretty much offset the lower production impact. This shows the advantage of our diverse assets and the staging of our major projects.

So overall, you can see that we're well positioned financially and will continue to manage our capital spend very carefully in response to how commodity prices and financial markets develop.

Now I'll pass it over to Harry to say a little more about the financial aspects of our plan.

Harry Roberts

You will recall that Petro-Canada's approach to allocating cash is to first invest in growth projects and then to use cash to pay dividends and buy back shares. We continue to receive very diverse and strong views on this approach. Some investors believe we should buy back shares right now, while others tell us to preserve our cash. Given these opposing views, I'd like to clarify our thinking here.

Let me start with Petro-Canada's value proposition, which is to create sustainable and long term value for shareholders. This is why we invest in large long-life projects that create cash flow and earnings for many years. Dividends are a way that give sustainable and growing cash directly to the shareholders, a long term commitment that must be preserved.

In contrast to dividends, share buy backs are a short term option that is exercised when we have more free cash than our growth projects require. Share buy backs are an activity where we find it difficult to determine the long term value created in terms of increasing share price. In my mind, share buy backs are definitely questionable in the current financial markets.

We don't want to leverage up our balance sheet or use valuable cash for what could be short term and somewhat indeterminate gains. We must preserve our financial flexibility as a way to manage commodity price uncertainty during this downturn.

While many of you will continue to share different views on this issue, during my career, I've experienced first hand the heavy toll that leveraging your balance sheet could have on a company. That's why we're in such great shape today. Our cash and liquidity position lead those of our Canadian peers.

At the end of the third quarter, our debt to debt plus equity ratio was 20.4% and our debt to cash flow ratio was .9 times, well below our targeted ranges. This is the ideal position to be in today. I firmly believe Petro-Canada's financially conservative and gradual view to creating shareholder value has positioned us well, not only during this downturn in this market but for when the market inevitably recovers.

Ron Brenneman

Our 2009 capital plan applies to prudence needed for the times. We're reducing our capital spend while making sure our operations continue to run safely and reliably. We'll pace our growth projects to take advantage of the soft market to improve project economics and we will maintain a strong balance sheet and use our liquidity to our advantage.

Petro-Canada is well positioned to weather this economic downturn and to continue delivering value to shareholders long into the future.

Ken Hall

We'd now be pleased to answer any investor questions. When these are done we will take questions from the media.

Question-and-Answer Session

Operator

(Operator Instructions) Your first question comes from Robert Kessler – Simmons & Company.

Robert Kessler – Simmons & Company

Ron, in your point about having some flexibility in the program, I was wondering if you might put a few scenarios around the $4 billion number and the flexibility there. If I run the cash flows through our model at least, it looks as though cash flows in and out balance at about $50 a barrel. Does that sound like about the right number? And around that, can you suggest what would happen to your CapEx program if crude prices either increase or decrease by $10 or $20 a barrel around that? So say if for whatever reason oil prices were at $70 on average for '09, what would your CapEx look like then, and then counter to that may $30 to $40 a barrel?

Ron Brenneman

I think you're pretty close to our assessment on the base case. The way we would look at it is that with the kind of flexibility that we have in our capital program, we would see being able to have minimal to no draw on our cash or liquidity in that $50 to $60 a barrel range, so I think you're pretty close on that assessment.

If prices drop below the $50 range, we would have to look carefully at whether we would pare our capital program back further or choose to draw on some of our cash or liquidity because as I indicated at the $4 billion range, we are not impacting things like short term production or the loss of opportunities to any great extent.

We could probably go a few hundred million below that and still maintain that same principle but when we start to think about trading off short term cash flow for CapEx, we might think about using some of our liquidity depending on how long we think the lower price scenario might last.

We're not at this point trying to make any prediction of at this price we'll spend this, and at this price we'll spend that. We're just kind of riding this through the year and adjust accordingly.

Robert Kessler – Simmons & Company

And that residual few hundred million flexibility, any suggestion as to what portfolio that resides in?

Ron Brenneman

It would be pretty much across the piece. It would be some drilling in western Canada and the U.S. It could be allowing some of our larger unsanctioned projects to slip a little bit. So there's lots of levers that we can pull within that number. We would just make a decision at the time depending on the circumstances.

Operator

Your next question comes from Terry Peters – Cannacord Adams.

Terry Peters – Cannacord Adams

My question is relating to your planned maintenance and turnarounds off the east coast. I wonder if you could indicate the timing of that work during the year as to when it would come, in which quarters. And also, you mentioned 15,000 barrels a day impact. That's not an average annual impact or could you just clarify what was meant by that?

Ron Brenneman

To confirm, the 15,000 barrels a day is the annualized impact of all of those four major shutdowns, and we've got a little table here that maybe Ken could take you through that indicates how many days for each quarter, or if you'd rather do that off line, Terry that might be more productive.

Terry Peters – Cannacord Adams

I can do that offline, but is most of it in the second and third quarter?

Ron Brenneman

I'm just looking down the list here, it's Q3, Q1, summer Q3, so it's through the first to third quarters. Ken can actually give you the days and the platforms.

Operator

Your next question comes from Ryan Todd – Duetsche Bank.

Ryan Todd – Duetsche Bank

I was wondering if you could give us any more granularity on the growth CapEx in terms of general chunks where most of that growth CapEx spend is focused.

Ron Brenneman

You're talking about the growth CapEx?

Ryan Todd – Duetsche Bank

Yes, the $2.1 billion in growth CapEx for the 2009 budget.

Ron Brenneman

It includes, the projects that you would be familiar with so the Syria natural gas project, the Libya developments, MacKay River expansion, the $350 million that I talked about on the Ford Hills project, the Montreal Coker, moving that along a little bit and then some spending in the gas business. But most of it would be on those major projects.

Ryan Todd – Duetsche Bank

How much do you anticipate spending in Libya for the year?

Harry Roberts

About $200 million next year.

Ryan Todd – Duetsche Bank

In general, the time line of the capital in Libya? I know you put in that you're spending $4.5 billion there, is there kind of a general time line and what time frame or how that plays out as a time frame, or is that kind of spread over the next decade and it's tough to do?

Ron Brenneman

What we've said is that that would be coincident with our doubling of production in the next five to seven year. It would tend to be back end loaded so we're getting off to a slower start than what you might think the ratable number might be if you just took that and divided it by five or seven, simply because we're doing some seismic work and some technical studies up front and just now getting drilling rigs lined up and into the field.

So we have two rigs operating there now starting on the exploration program and we're looking at bringing in a third rig toward the end of the year.

Ken Hall

You can assume $200 million for 2009/2010 and probably starting in 2011 after we plan to have the field development program accrued to get up to about the $500 million a year range after that.

Ryan Todd – Duetsche Bank

You're credit facility availability right now, is that $3.5 million or $4 million? Can you remind me what it is?

Harry Roberts

The credit facilities are about $4 billion that are undrawn at this point.

Operator

Your next question comes from Andrew Fairbanks – Merrill Lynch.

Andrew Fairbanks – Merrill Lynch

I wondered if you had any thoughts on how reserve replacement is shaking up this year. You indicated at the analyst meeting that international looked pretty good but on a corporate wide basis, do you have a sense for how that's shaping up as we go into the end of the year? Either for yourselves or the industry, do you think there would be any areas where we're going to be seeing any kind of accounting asset write down given oil prices as we go into the later days of the year?

Ron Brenneman

I don't anticipate any accounting write downs but we really need to go through the exercise. I don't want to speak for the auditors, but I certainly don't expect any.

On your other question on reserves, I'm always hesitant to predict but I think we're going to come out pretty well at the end of the year for a couple of reasons. One is that we will be booking some pretty significant 2P reserves associated with the expansion of the Libya concessions. I think we've indicated previously that's in the order of 160 million barrels.

We target about 50% to 60% reserve replacement in Western Canada, so we'll have to see how that shakes out. I don't know if you're thinking whether we're going to be 100% or less, I think we're going to come out pretty well.

Operator

Your next question comes from Brian Dutton – Credit Suisse.

Brian Dutton – Credit Suisse

I was wondering two things. First could you split out for our your North American natural gas production, western Canada versus the U.S. in your guidance, and second give us some insight please in terms of the thoughts behind your North American gas CapEx program for 2009.

Ken Hall

For the total 98,000 barrels a day for North American natural gas, about 80,000 is western Canada and 18,000 is U.S.

Brian Dutton – Credit Suisse

That's on the total BOE's? I was thinking on the natural gas itself.

Ken Hall

I have that number in my office. I can call you after.

Ron Brenneman

Your other question was our thinking about the CapEx and the level, is that what you're asking?

Brian Dutton – Credit Suisse

Yes, your philosophy thinking behind how you put together your capital program for your North American natural gas business.

Ron Brenneman

We're actually quite disciplined about that. We start with the expectation that this business is in the portfolio to generate at least a modest amount of free cash flow, so we're looking for $100 million to $150 million of free cash flow. We set that at an expectation for next year I think at $7.00 per mcf.

And then we basically back down through the opportunities we have and say we would expect to replace about 60% of our production, and when you work that back through the program we end up with the capital allocation that we're talking about.

We start with the purpose of the business, and then we back it down. It's not quite mechanical but it's pretty disciplined in the way we do that.

Operator

Your next question comes from Mark Polak – Scotia Capital.

Mark Polak – Scotia Capital

During the turnaround at Terra Nova you will be looking at swapping out the water injection swivel or is that still holding together well and you'll wait and see how it holds out?

Ron Brenneman

No, we're not planning on that Mark. Actually the swivel continues to operate well within tolerance limits. As we've indicated before, we have a contingency plan in place if we do see some deterioration in that and it's kind of a two step program.

The first step would be actually swapping out within that turret service between gas injection and water injection, and that would carry us to a point where we could actually do a planned replacement on an orderly basis. We have ordered the turret. We have the turret in hand so we could actually replace it on a planned basis if we had to, but so far it's performing quite well.

Mark Polak – Scotia Capital

One other question on Fort Hill, you mentioned that the investment decision on the mine sometime in 2009. Would you expect that to more likely be the second half of the year?

Ron Brenneman

It's kind of a two step process. Sometime in the first quarter we're hoping to get some of the outstanding issues clarified. As I've indicated before, there's really three things that need to come together for us.

I would say first and foremost is some agreement with the province on the tenure of the lease which gives us the flexibility to manage the project on a non critical time basis. The second one is to try to get the cost down and so we're working as I've indicated before on rebidding and retendering and even looking at some of the scope around the margin of the project itself to see if we can reduce the cost. That's an economically driven motive. And the third one is to really see if we're going to get some more certainty around the partnership issue.

Mark Polak – Scotia Capital

And the negotiations with the province are they centered mainly around timing or would you like to see the volume thresh hold brought down to give you the flexibility of maybe just doing one train?

Ron Brenneman

We could do one train with the higher thresh hold, so it's all about the timing mark.

Operator

Your next question comes from Mark Gilman – Benchmark Company.

Mark Gilman – Benchmark Company

How, if at all would either the mix or the total dollar capital program for '09 change if you were to come to a positive sanction decision on Montreal as well as the MacKay expansion?

Ron Brenneman

The assumption in the number is that the MacKay expansion would go ahead with the sanction sometime in the first quarter, so that's included in the number. The Coker, we've actually put some place holding money in there in case, but if we did choose next year to go ahead, we'd probably have to add some capital depending on the schedule that we looked at. Did you have another one you were asking about/

Mark Gilman – Benchmark Company

No, I was just trying to understand. You said place holding capital for the Coker, does that mean that if you go ahead it would be at the increment capital would be at the expense of other segments of the budget or an increment versus the $4 billion level?

Ron Brenneman

I think we'd have to see that the business environment had improved enough and the financial markets encouraging enough for us to look at spending more than the $4 billion. So right now, it's as I said, we've got a place holder in there to continue with some of the engineering but not to actually start the field work, if you're talking about the Coker.

Mark Gilman – Benchmark Company

Yes. The exploratory drilling number, if I'm interpreting the numbers correctly is down very sharply '09 versus '08 and it would appear furthermore in looking through the other tables that there's essentially no drilling at all planned for Trinidad in '09. Can you give me your thinking on this matter? Is my interpretation correct and should I draw any conclusion from the fact that this low activity level was planned for Trinidad specifically in '09?

Ron Brenneman

Well first of all the reason for the drop in dollar numbers is actually Trinidad because that was, I don't know how many wells we actually completed, or six last year, but certainly the four deep water offshore wells were quite costly.

So the fact that we're no longer drilling in Trinidad is the main reason for the drop because we are continuing with the program. Three wells in Alaska, there's three or four wells in Libya, there's three or four wells in the North Sea and there's one on the east coast. We're still fairly active. I think we're talking about up to 12 wells there. Last year was maybe 17 or something.

But the reason we're not drilling in Trinidad, we're basically taking this year to assess the commerciality of the project and look at some different options. I think at the investor day you were at, we talked about different possibilities for the offshore and needing to negotiate some commercial terms in the domestic market for the near shore discoveries that we have.

So I wouldn't read anything into it other than it's time to basically look at the commercial aspects and we would need to obviously line up a rig before we start doing any appraisal and delineation work, but before we do that, we want to know where we're going from a commercial aspect.

Mark Gilman – Benchmark Company

With respect to Ebla, do you have, and I believe it's in the investor day presentation, characterized a working interest contingent resource number of 850 days. Is that on top of the 450 that underlies the phase one if I'm interpreting it correctly and what is the contingency specifically related to?

Ron Brenneman

I'll have to get Ken to come back and confirm this with you. I believe that the 850 is total including the 450, but it may be added. I need to check that. The category of contingent is simply an SEC based definition of how you categorize resources.

But from a practical point of view if this is what you're asking, there's a belief that in addition to the 450 bcf that the project is based on, we've always said that we think there could be as much as double that in total and it's contingent on being able to demonstrate that through some appraisal drilling that we will do once we get the development drilling done for the main project.

Mark Gilman – Benchmark Company

My understanding of contingent resource per the SEC is standard definition as such is that it's discovered by there's some typically economic contingency, not a sub surface uncertainty.

Ron Brenneman

It can be either/or. I'm not steep in the legalese of this, but the way I normally think of it is that it can be contingent either on some economics, needing to demonstrate some economic or even some practical feasibility. This is a resource that we believe to be there but hasn't been demonstrated to be commercial through flow rates.

We're dealing with wells here that were drilled 10 or 15 years ago really were not properly tested and appraised at the time so we need to go back in and confirm that.

Operator

Your next question comes from Andrew Potter – UBS Securities.

Andrew Potter – UBS Securities

Can you talk for a second about what the possibility or potential is of time for Fort Hills and the Montreal Coker?

Ron Brenneman

It's something that we've started to look at and it would depend first of all on the reversal of line nine so you could actually get that there. There seems to be some initiative under way. We're not involved in that because we're not shippers on the line, so we're just observing at this point.

But from our perspective the Montreal Coker and the economics associated with it are based on running foreign heavies which we do some of now. It's basically justified on a stand alone basis running foreign heavies.

If line nine were reversed, we could certainly run some dill bit in Montreal and the early indications are that it would actually improve the economics because you've got a wider light-heavy differential from western crude than you do from foreign crude.

And actually the other thing we've looked at is if we were to make a further investment in replacing the atmospheric and vacuum unit, to basically put the kind of metallurgy in that you need to run dill bit, we could actually run a very substantial amount of dill bit in Montreal. So that's one of the options that we've been looking at.

Andrew Potter – UBS Securities

Can you talk a little bit about your potential in the [Motney] and [Musquale] Shale? Is there any activity planned for '09 or is it still a longer term initiative.

Ron Brenneman

We actually have two projects under way. One is in the Kolbs area which is in the [Motney] trend which is a two horizontal well and maybe a vertical well, I can't recall all the details now, but it's actually just finishing up now. The well is just being completed and we're just in the process of starting to flow it back.

And then we have another project up in the Horn River area that is similar in size and scope that we're going to do this winter. So as we've indicated before, we've got a pretty substantial acreage position in those two project areas and our objective this winter is to do some pilot work to really demonstrate the overall viability of the project just through flow rates and initial testing.

Andrew Potter – UBS Securities

Can you talk a little bit about what the cycle time would be on the Alaska Foot Hills? Is this a five year kind of time or is it a ten year?

Ron Brenneman

There's two possibilities to commercialize gas up there. One of them is of course the big Alaska Gas Pipeline which is too far off in our view to be of much interest. But one that's more interesting for us is the local Alaska market which is in the order of 300 million to 350 million a day.

But essentially, it's local consumption as well as L&G export and the supply for that which comes out of the [Coquinlet] basically is on a pretty steep decline and so there's an opportunity through what's being termed a bullet pipeline to basically connect up this Foot Hills area trend that we're working to the domestic Alaska market. And that's the one that's of more interest to us, and obviously shorter term in nature.

Operator

Your next question comes from Brian Dutton – Credit Suisse.

Brian Dutton – Credit Suisse

If you could give us some insight as to what you're seeing in the down stream business, particularly how you're seeing the refining margins at this point as well as the retail margins.

Ron Brenneman

Refining margins are pretty dismal right now and that's a continuation of a trend that we've seen for the last quarter or so. It doesn't seem to have improved much. Marketing margins are holding up pretty well and so far our marketing results look to be pretty much consistent with what we saw through the course of 2008.

Of course the other thing that's going to drive our economics for 2009 more than it has before is the light-heavy spread and that seems to be holding up pretty well too because that's driving the economics for our refinery conversion project.

Brian Dutton – Credit Suisse

What about your convenience store sales? How are they holding up in this environment?

Ron Brenneman

Pretty flat. Normally we would be reporting same store sales up anywhere from 5% to 8%. Right now same store sales are pretty flat. The exception to that is our Neighbor stores which we have 17 or 18 now mostly in the Toronto area, in the GTA and they seem to be outperforming the rest of the network which is a good sign because that's sort of our new offering that we're moving to.

So for us, it kind of confirms the value of that offering and the fact that we're on the right track.

But I think what we're seeing obviously is a tendency for people to forego convenience in favor of economics. If you follow these retail trends you'll see that sales at Costco are up and obviously people are going in and buying bulk packages and breaking them down instead of buying them one at a time at the convenience store. And that's just my general take on what's happening out there.

Operator

Your next question comes from Mark Gilman – Benchmark Company.

Mark Gilman – Benchmark Company

I was looking at the major sanction project table. I noticed the project expenditures for the White Rose extension of $700 million. Is that just north Amethyst and west White Rose?

Ron Brenneman

That's only north Amethyst. Ken is saying it includes White Rose as well, so it's the first two of the extension developments.

Mark Gilman – Benchmark Company

Is that a lower number than you were thinking about previously for that?

Ron Brenneman

I think you may be thinking back to $1 billion that we had in there at one time.

Mark Gilman – Benchmark Company

Exactly.

Ron Brenneman

That turned out to be a definitional difference from the way that we normally report offshore projects and normally we report the capital up to first production, and that's the $700 million. The $1 billion was sort of the full development including drilling post start up. So both numbers are right, they're just a different definition.

Operator

There are no further questions. I'd now like to turn the meeting back over to Mr. Hall.

Ken Hall

Any further investor questions can be forwarded to me or my colleague Lisa McMann. Media are welcome to contact us, and once again, we're glad you could join us and thank you for your interest in Petro-Canada.

Copyright policy: All transcripts on this site are the copyright of Seeking Alpha. However, we view them as an important resource for bloggers and journalists, and are excited to contribute to the democratization of financial information on the Internet. (Until now investors have had to pay thousands of dollars in subscription fees for transcripts.) So our reproduction policy is as follows: You may quote up to 400 words of any transcript on the condition that you attribute the transcript to Seeking Alpha and either link to the original transcript or to www.SeekingAlpha.com. All other use is prohibited.

THE INFORMATION CONTAINED HERE IS A TEXTUAL REPRESENTATION OF THE APPLICABLE COMPANY'S CONFERENCE CALL, CONFERENCE PRESENTATION OR OTHER AUDIO PRESENTATION, AND WHILE EFFORTS ARE MADE TO PROVIDE AN ACCURATE TRANSCRIPTION, THERE MAY BE MATERIAL ERRORS, OMISSIONS, OR INACCURACIES IN THE REPORTING OF THE SUBSTANCE OF THE AUDIO PRESENTATIONS. IN NO WAY DOES SEEKING ALPHA ASSUME ANY RESPONSIBILITY FOR ANY INVESTMENT OR OTHER DECISIONS MADE BASED UPON THE INFORMATION PROVIDED ON THIS WEB SITE OR IN ANY TRANSCRIPT. USERS ARE ADVISED TO REVIEW THE APPLICABLE COMPANY'S AUDIO PRESENTATION ITSELF AND THE APPLICABLE COMPANY'S SEC FILINGS BEFORE MAKING ANY INVESTMENT OR OTHER DECISIONS.

If you have any additional questions about our online transcripts, please contact us at: [e-mail]. Thank you!