Jamba Management Discusses Q2 2013 Results - Earnings Call Transcript

Aug. 5.13 | About: Jamba, Inc. (JMBA)

Jamba (NASDAQ:JMBA)

Q2 2013 Earnings Call

August 05, 2013 5:00 pm ET

Executives

Karen L. Luey - Chief Financial Officer, Principal Accounting Officer, Chief Administrative Officer, Executive Vice President and Secretary

James D. White - Chairman, Chief Executive Officer and President

Analysts

Scott Van Winkle - Canaccord Genuity, Research Division

Anton Brenner - Roth Capital Partners, LLC, Research Division

Gregory J. McKinley - Dougherty & Company LLC, Research Division

Conrad Lyon - B. Riley Caris, Research Division

Kurt M. Frederick - Wedbush Securities Inc., Research Division

Operator

Good day, ladies and gentlemen, and thank you for standing by. Welcome to the Jamba, Inc. Second Quarter 2013 Earnings Conference Call. [Operator Instructions] I would now like to turn the conference over to Karen Luey, Executive Vice President and Chief Financial Officer. Please go ahead.

Karen L. Luey

Thank you, operator, and good afternoon. With me on today's call is James C. White, our Chairman, President and CEO. During today's call, I will review our second quarter financial results. James will follow with an update on our BLEND Plan 3.0 initiative. We will then open up the call for questions.

I would like to remind all listeners that this call is being broadcast and recorded live over the Internet at jambajuice.com. The webcast is available on our website and a replay will be available via telephone until August 26, 2013.

This conference call will include forward-looking statements within the meanings of the securities law. These forward-looking statements will include things about the company's strategic priorities and certain statements of our expectation and plans. These forward-looking statements are subject to risks and uncertainties that could cause our actual results to differ materially from the forward-looking statements that are contained in the company's filings with the SEC, including the Risk Factors section in our Form 10-K. The company does not assume any obligation to publicly release any revisions to the forward-looking statements discussed during the call.

With that said, I would like to turn it over to James.

James D. White

Thank you, Karen, and welcome to our second quarter call. The solid start that Jamba experienced in Q1 continued during Q2 in the face of intensified competition and a challenging consumer environment. Q2 had several accomplishments that I will highlight briefly and cover later in more detail.

Importantly, increases in comparable store sales for the company-owned stores continued at a rate that outpaced many of our peers, up 2.2% for the quarter against a strong prior year period increase of 5.1%. Comparable store sales also were positive for our franchise stores, up 1.2% for the quarter as compared to 6.4% for the prior year period. Systemwide, we posted positive comparable store sales of 1.7%.

The net income after dividends for the quarter increased 51% to $6.2 million from $4.1 million for the prior year quarter. We continue to accelerate our marketing investments to attract increased numbers of light and lapsed users and broadly strengthen our brand franchise.

Our expansion of fresh juice, our unique whole food blending and juicing platform, and our store reimaging initiative also accelerated with installations at 23 locations. By year end, we plan to have at least 50 sites open.

Our new supply chain optimization initiative, which we started last month, will significantly lower cost, improve efficiency and enhance our ability to invest in growth programs. Along with our initiative on labor optimization, organization structure, and marketing and pricing, we have a clear pathway to grow our store margins and increase our income from operations.

Our turn to provide additional prospective on these accomplishments share more about the key initiatives that will drive our results for the balance of the year, but now I'll ask Karen to take us through the financials.

Karen L. Luey

Thank you, James. Our performance in the second quarter of fiscal 2013 was solid despite a challenging economic environment and weather challenges outside of California. For the quarter, our net income after dividends improved by 51% to $6.2 million or $0.36 diluted earnings per share compared to $4.1 million or $0.27 diluted earnings per share for the prior year same quarter.

Our income from operations, operating margin and store margin also showed improvement over the prior year quarter. We ended the quarter with over $32 million in cash and no debt on the balance sheet.

Total revenue for the second quarter increased by 1.9% or $1.2 million to $67.3 million, and company store revenue increased 0.4% year-over-year to $62.8 million. Systemwide, our same-store sales increased 1.7%, with company stores at an increase of 2.2%, and franchise stores increased by 1.2% for the quarter. This capped 2 full years of positive same-store sales for the system. Excluding the weather-challenged geographies in the Northeast and Midwest, our same-store sales of both company and franchise would've been 3.2%.

At the company store increase, average ticket was higher by 60 basis points and traffic by 160 basis points. All 4 dayparts for the company stores reflected positive same-store sales.

We continue to introduce relevant and habitual offerings to our menu, including our rollout of our whole food blending and premium juice platform that is currently offered in 23 locations in California. During the quarter, we continued to invest in our marketing strategy to target our light and lapsed users with compelling promotional offerings that focus on our Strawberries Gone Wild platform. Our attachment rate for the quarter was 20%.

A few words about our premium juice platform. While still in its early rollout, the stores that have premium juice are experiencing a 300 to 400 basis point increase in same-store sales, with juice mixing at approximately 12% of sales with a minimal amount of out-of-store marketing. We will begin our marketing strategy for this platform later in the third quarter.

Our franchise and other revenue for the second quarter increased by 27.2% to $4.5 million compared to $3.5 million from the same prior year quarter. This was attributable to the increase in CPG revenues to $1 million from $0.3 million in the second quarter of 2012, and royalties related to the increase in the number of global franchise stores opened since the third quarter of fiscal 2012.

Our store 4-wall margin in the second quarter was 24.4% as compared to 24.2% in the prior year. During the second quarter, the 4-wall margin improvement was as a result of fixed cost leverage related to occupancy and store operating expenses. This was offset by an increase in cost of sales of approximately 100 basis points related to the increased promotional investments due to drive our light and lapsed user strategy.

Now let me discuss general and administrative expenses for the quarter. G&A decreased by $0.6 million as a result of a reduction in performance-based compensation, partially offset by a slight increase in resources deployed against our growth initiative and in stock-based compensation. We deployed additional resources in the latter part of 2012 to capture the significant opportunities with our JambaGo platform, which grew to a total of 636 locations served by the end of the second quarter. We will have at least 1,500 locations served by the end of fiscal 2013.

The second quarter reflects tax expense of $0.2 million, and our projected effective tax rate for the full year is an expense of 1.7%. We continue to have a full valuation allowance against our deferred tax assets. Our cumulative federal net operating loss at the end of fiscal 2012 was approximately $112 million. We can and we will utilize our tax NOLs to offset federal and state income taxes, although we are forecasting to be in an alternative minimum tax position where full NOLs cannot be utilized.

Our share count includes the effect of the 5-for-1 reverse stock split that became effective during the second quarter. All prior year financial statements have been restated to reflect the stock split. During the quarter, the last remaining piece of the convertible preferred stock was converted into common shares. Preferred dividends recorded for the quarter was $0.1 million, and there will be no further dividend outlay related to the preferred stock.

Our balance sheet remains strong with over $32 million in cash and cash equivalent and no debt at the end of the quarter. Subsequent to the end of the quarter, Wells Fargo Bank has agreed to increase our revolving credit line to $15 million and extend the maturity date to 2016. We have not yet drawn on the credit line and we'll continue to use it to collateralize several letters of credit.

Our capital expenditures for the quarter were $5 million related to maintenance capital, investments made under our store refresh program and investments in our information technology platform. Our guidance for fiscal 2013 capital expenditure is a range of $10 million to $11 million and includes plans to open a fully remodeled up to 5 company stores, our refresh of up to 50 company store locations, maintenance capital and information technology investments.

With that said, I'd like to turn the call back to James.

James D. White

Thanks, Karen. As I said, Jamba had a quarter of solid accomplishments in the face of challenging environment where competition intensified and consumer confidence was dampened by the ongoing employment uncertainty, and discretionary spending was diminished by the resumption of payroll tax deductions. By increasing our marketing investment and highlighting value promotions, we invested to retain our market share and grow our user base by successfully targeting light users and lapsed users. The analytics we developed from these efforts also position us to improve our marketing impact in the future. And virtually all of the metrics for brand franchise strength, including awareness and affinity, were strengthened during the quarter.

Our record of more than 2 years of quarterly systemwide comparable store sales growth, 11 straight quarters, continued with increases that outpaced many of our peers. We continue to innovate with product, store formats, marketing initiatives and special promotions.

While our whole food blending and premium juicing platform is still new, the results in the early stages are very positive. We're now in 23 locations with fresh juices, and even though marketing hasn't started, sales are strong. And the excitement these installations generate is extraordinary.

Store reimaging also is proceeding at a rapid pace with 23 reimaged locations completed and another 27 planned for the balance of the year, for a total of 50. We have 2 waves of future summer offerings, the first phase highlighted a range of strawberry smoothies, our Strawberries Gone Wild offerings and a new fruit and vegetable tropical harvest smoothie. The second phase, which is just getting underway, features our exciting KonaWellness bowls, which are eaten with a spoon that -- Kona juice, soy milk, fruits, organic granola toppings and other fun nutritious ingredients make for a satisfying nutrition packed meal.

KonaRed is called a Hawaiian super fruit because of its naturally occurring antioxidants and natural energy. We'll also have a new Kona Berry Blast Smoothie and a number of new whole food boost, including Greek yogurt, chia seeds and whole grains.

Also featured for the end of the summer and back-to-school is our tie-in with the new animated Disney blockbuster movie called Planes. The promotion provides a great boost for new kid smoothies and meals. It includes a 1-day kids' smoothie giveaway and a set of collectible cups that will be offered throughout the promotion.

In a new effort focused on combating childhood obesity, Jamba's partnering with the nonprofit GENYOUth Foundation, a partnership between the NFL and the National Dairy Council. This initiative seeks to educate and raise awareness in more than 70,000 schools across the country on improving dietary choices and encouraging healthy activities.

Our marketing is multifaceted and in one important effort to boost traffic, trial and loyalty, we are teaming with Spendgo, a new loyalty concept provider. Jamba will be the lead retail participant for this innovative and engaging program that seeks to drive incremental visits and increase the average check of medium and heavy users, drive trial and awareness of light users and increase the brand engagement of all customers.

Jamba also had a good quarter for development of domestic and international franchises. In the U.S., we opened 11 new company and franchise stores and signed 9 developed -- 9 new development agreements for 57 locations in California. These are part of the accelerated growth plan for the state that will add up to 125 new units. With these deals in process, we are fully subscribed in California.

Internationally, we opened 3 new units and are close to adding a fifth major market outside of the U.S. Our partners in Canada, South Korea, Mexico and the Philippines plan to open 400 stores over the next decade. We've also identified several other promising markets that provide us with an excellent pipeline for future international agreements and make us confident that we will reach our target of 1,000 international stores.

As we plan our future, we also see JambaGo and our Smoothie Stations as strong growth drivers. The 600-plus current JambaGo installations will grow to over 1,500 by year end, with some exciting prospects lined up to meet or exceed our goal. Our limited menu Smoothie Stations make possible co-branding and other opportunities.

Another driver of future growth is our consumer products platform, which continues to perform well. Our new Green Fusion smoothie kit has secured distribution with Safeway, Walmart, Costco and several other major accounts. Jamba Energy Drinks are now being offered in more than 3,700 Rite Aide stores across the country, and both Jamba frozen novelties and Talbott Teas are gaining added distribution.

While growth is an important part of the Jamba story, so too is our focus on reducing costs and driving productivity enhancements. We plan to build our supply chain into a global competitive advantage, leveraging new and existing relationships to drive greater efficiencies and effectiveness in supply sourcing and distribution. To assist in that effort, we are now working with a major consulting firm. Based on our initial assessment, we believe significant savings can be realized and are now in process of firming up projected savings.

Given our Q1 and Q2 results, we see good progress towards meeting our targets for the year. Sales for the initial weeks of Q3 continue to reflect the challenging consumer and competitive environment in Q2. So to meet these challenges, we will continue to invest in our growth initiatives and maintain our heightened marketing initiatives to drive traffic and gain new users.

As I said, I'm pleased with Jamba's results and achievements. We are maintaining our heritage and are building Jamba as a leading globally-recognized healthy active lifestyle brand. Our talented management team and our winning business model will enable us to achieve accelerated growth.

Before I conclude, I'd like to welcome new partners in the U.S. and from around the world to the Jamba family. I would also like to thank the Jamba team members and franchise operators across the system for their continued efforts and commitment to build and transform the company and deliver outstanding service to our customers.

I will now turn the call back to the operator so that we can open up for questions.

Question-and-Answer Session

Operator

[Operator Instructions] Our first question is from Scott Van Winkle with Canaccord Genuity.

Scott Van Winkle - Canaccord Genuity, Research Division

The first question is, you've got juice, and it seems like it's rolling out slow relative to how impactful it is. And then the same question on international, given the incremental contribution, it seems like you'd want to pick up the pace. Is it -- am I thinking wrong there, or what's the thought?

James D. White

Yes. So 2 points. As it relates to our premium juice and whole food blending initiative, we want to make sure that we get it right. So we're very diligently working through the offering, the store environment and importantly, the supply chain. And you'll see us as we move to 2014 lay out a game plan to accelerate the rollout beyond the 50 locations or so contemplated in the short run. As it relates to international, we're actually really excited about where we sit today with full partners and a robust pipeline with those partners. We see several very promising new partners in some critical countries on the horizon, and I expect to be able announce 1 to 2 deals there. But we will start to accelerate as we move forward, but it's more important that we get the right partners as we think about international and we end up in the right markets before we accelerate too rapidly. But we're very pleased with the early collaboration on both of those initiatives.

Scott Van Winkle - Canaccord Genuity, Research Division

Yes, I guess patience is a virtue there. They're putting out good results so I just want to see them as fast as possible. And then, James, it seems like even in your call here and you see it in the stores, it seems like the menu is more on-trend and more kind of innovative and moving. You're talking about things like chia. Is there a real effort to kind of jump on the hotter food trends faster? I mean, is that what we're seeing in the stores?

James D. White

Yes. We've aggressively sped up, over the course of last 24 months, our innovation pipeline, and we think we will be on or ahead of critical trends. We've added chia to the boost lineup. We've added Greek yogurt. We announced the partnership with Quaker to add whole grains to the offering and, really, more to come. We are actually very pleased with where we sit. The premium juicing that we've worked on, the whole food blending, we put up against anybody in the industry and more to come as we scale some of those initiatives.

Operator

And our next question is from Tony Brenner with Roth Capital Partners.

Anton Brenner - Roth Capital Partners, LLC, Research Division

2 questions. I think Karen mentioned that marketing expenses were up in the quarter, yet as a percent of store sales, store operating expense percentage-wise was down pretty sharply. Could you explain that, Karen, discrepancy or disparity?

Karen L. Luey

Yes, Tony. In the store operating line, we -- there are fixed costs in there, especially with some of our more -- I would say, some of the variable operating cost, so we are able to get some leverage on the store operating expense line.

Anton Brenner - Roth Capital Partners, LLC, Research Division

Okay. So all that decline is basically positive sales leverage?

Karen L. Luey

That's correct.

Anton Brenner - Roth Capital Partners, LLC, Research Division

Okay. And second, I wonder if you could talk about what sort of margin change there is in your franchise and other revenue, given the changing sales mix. How is -- how are those profit margins changing year-over-year?

Karen L. Luey

Well, the profit margins and the franchise and other revenue line, Tony, will tend to increase over time. That's part of the asset light model that we're operating under, as both the CPG business and our franchise business will over time get to flow through about 60% to 70% through to the bottom line.

Anton Brenner - Roth Capital Partners, LLC, Research Division

How can your own CPG business have the same margins as your licensing business? And your -- and well, I mean, or even your franchise business? That seems unrealistic.

James D. White

Well, Tony, just to kind of back up in time and history, the CPG business, which would have originally been a licensed business, would have been 80% to 90% flow through. As we've added full P&L ownership of a couple of the businesses, that margin has come down to the 60% to 70% range. So -- but it mixes out at 60% to 70%. We've got very few fixed or G&A-related assets on that business.

Operator

And our next question is from Greg McKinley from Dougherty.

Gregory J. McKinley - Dougherty & Company LLC, Research Division

Could you give us a little more color on the types of promotions you're running to bring in, I guess, what you call sort of a low-frequency consumer? And how are you measuring their response to that? And then, Karen, where has that shown up in your P&L?

James D. White

We've had a range of what we would describe as value-oriented promotions from the buy 1, get 1 free offers that we've executed in the quarter. We've had several offers for $2 value smoothie promotions and then, a couple offers like the free kids day, would be the kinds of things that we're doing that are targeted at either a daypart or a consumer or a part of the menu. In this quarter, we would have also executed around or make it a meal in the beverage and a meal bundles, but they're all very surgically executed across the marketing mix. Karen, would you answer the second?

Karen L. Luey

Okay. They reflected as a reduction in company store sales.

Gregory J. McKinley - Dougherty & Company LLC, Research Division

Okay, so those -- I see, so these are just discounts that are showing up as net sales rather than separate advertising or marketing dollars?

Karen L. Luey

That's right.

James D. White

Exactly.

Gregory J. McKinley - Dougherty & Company LLC, Research Division

Okay. And then what, if anything, can you tell us on JambaGo so far? So, it sounds like a lot of units are out there. Are you able to share at any point now financially what's the impact of this? How can we start measuring your results with that?

James D. White

Yes. What we hope to be able to do is in 6 to about 8 weeks, I'd like to be able to lay out the 2014 early outlook. In that, we'll include JambaGo economics. I want to talk a lot more about international, which will start to really come in to a greater focus as we move forward. And I also want to talk about the cost savings initiative that we've hinted at, which we think holds great promise. But it will be, call it, late September, early October that we'd lay out our outlook and guidance for '14. Included in that will be more specificity around the JambaGo economics. And if everyone on the call would recall, what we said we'd do is sometime in Q3, we would start to unfold the JambaGo economics publicly.

Operator

And next is Conrad Lyon with B. Riley and Company.

Conrad Lyon - B. Riley Caris, Research Division

Question just about the same-store sales. I appreciate what you said about the economy and the weather, but just personally, given that the comparison got a lot better and even in the core market of California, temperatures were actually, at least in my area, were a lot warmer. I was actually surprised that, that growth wasn't greater. Is there any other insight you can provide, like was there some dynamic for the quarter? Or are you seeing something better now because it's certainly, the guidance now implicitly expects an increase in same-store sales, which clearly we should get the easier comparison. But I just want to know if there's something more organically going on?

James D. White

I guess the point that we would make in -- as much as we wouldn't like to admit this, we actually think we're moving into a new normal environment of just, really, the consumer is challenged. We continue to be impacted by out-of-pattern weather. And Karen alluded to the weather we experienced, really, most of the first half in key Eastern markets like Chicago and New York City. And really, where that has us is really focusing on improving every element of our business. At the center of that is the fresh juice platform and our whole food blending related to that is what we're going to do to look at our supply chain globally and our entire cost structure. But I think we're moving to a new place just in terms of the operating environment that we're all going to compete in. And versus putting our head in the sand, we actually think that's becoming more of the new normal and we're really sharpening everything that we do inside our company to make sure we can take full advantage of what we think is an advantaged categories. We think about the better-for-you space at an advantaged brand being Jamba. But the environment just continues to be a little bit choppy. And we actually believe that's going to be the environment we're going to be play in for the foreseeable future.

Conrad Lyon - B. Riley Caris, Research Division

Yes, I see that, and so that would be my other question. Starbucks had some great results and they've talked about their refreshers doing very, very well and then also talked about Evolution Fresh product going into wider distribution. Do you think that had any impact?

James D. White

Zero on this, I mean.

Operator

Next is Kurt Frederick with Wedbush Securities.

Kurt M. Frederick - Wedbush Securities Inc., Research Division

I just had a question on the store sales to the franchisees. Where was that? And then, are there plans to sell other company-owned stores?

James D. White

Yes. The stores that would've been sold to the franchisees would've been within our overall California plan, and there would have been a handful of stores that would've been packaged as we talk about the 9 development agreements that were announced and a little bit under 60 stores that will be developed as a part of that. So that it would have been all in the state of California.

Kurt M. Frederick - Wedbush Securities Inc., Research Division

And on JambaGo, you said basically, I mean, basically meeting or exceeding the 1,500. That means you're going to add, really, a lot here in the second half. I was wondering how that splits between the 2 quarters?

James D. White

It will be primarily be late -- middle Q3 and Q4.

Operator

And next, we have a follow-up from Scott Van Winkle.

Scott Van Winkle - Canaccord Genuity, Research Division

I'd like to touch on juice again. The strength you saw on the stores that added juice was a 300 to 400 basis point lift to sales, and it's now 12% of the mix. I believe that's double what juice is, if I'm not mistaken, in other stores. What do you think is behind this kind of the hot, on-trend juice? The other question asked about Evolution Fresh at Starbucks, is there something you think's going on with juice where it's just the hot flavor, so to speak?

James D. White

Yes, I guess the point that I'd make, I think, broader than juice is a delivery mechanism. There is a significant consumer move to more fruits and vegetables and more whole food fruits and vegetables in their diets, and juice is one of the easier ways to deliver higher nutrition that we think consumers are now rushing to find, to add to their diets as everybody is trying to lead healthier lifestyles. And we actually think we're in the process of building an advantaged platform to deliver against that trend in the highest order, which is fresh.

Scott Van Winkle - Canaccord Genuity, Research Division

Is it more daypart-specific by any chance?

James D. White

At least our early read would break it across dayparts. It's a far more habitual consumer. And it actually allows us to take away, we think, some of the seasonality of our business after we scale.

Operator

And we have another follow-up from Greg McKinley.

Gregory J. McKinley - Dougherty & Company LLC, Research Division

Karen, maybe just digging into expense structure a little bit, can you remind us how you would anticipate G&A costs behaving for the year? And I'm not quite sure why I've lost it in my notes here, but typically, there's a little bit of a catch-up accrual in Q4. Maybe just remind us how you expect G&A costs to come in for the fiscal year? And then on a cash tax basis, how should we think about '14 in terms of what kind of effective tax rate you'd be booking to?

Karen L. Luey

Yes, Greg. For G&A, for the total year or for the rest of the year, you're correct. Usually in Q2 and Q4, there's a little bit of an accrual for performance-based compensation. And so there was, if you recall in my prepared remarks, there was some performance-based compensation booked in Q2, although it was less than last year by about $600,000. And so what we would expect for the third quarter is sort of a normalized run rate for the quarter for G&A and then another spike in Q4 for a bonus accrual if certain performance metrics are met.

Gregory J. McKinley - Dougherty & Company LLC, Research Division

And can you give us any sense for what total G&A then would look like in dollars for the year?

Karen L. Luey

What we've said is that it would be flat for last year. So that was about, I think, $40,000 -- $40 million all in.

Gregory J. McKinley - Dougherty & Company LLC, Research Division

Yes, okay, good. And then, in terms of an effective tax rate we should be thinking of next year?

Karen L. Luey

So, it's a little early for us to tell but what we're using in our forecast today is something between 10% and 15%. We'll refine that number as we get to the third quarter call that James was alluding to. We'll have more visibility at that point in time.

Gregory J. McKinley - Dougherty & Company LLC, Research Division

And then -- and finally, if we were to visit one of these reimaged stores, what would be -- how would they look differently to the consumer just passing by the storefront? Is it visually much different? Is it -- does it catch the consumer's eye that this is now a blended whole foods offering from maybe differently, how they thought about Jamba Juice in the past?

James D. White

The most striking change for the consumer would be inside the store, more to come in terms of the visuals outside the store and our out-of-store marketing, which really hasn't started at this point. But inside the store, there would be visual cues, it would show the whole fruit and vegetables in a proprietarily-designed cube. Just the look and feel of the stores will be more contemporary and the ability to add products like chia, Greek yogurt, et cetera would all add to, we think, the change from the consumer looking for good-for-you, better-for-you product solutions that were whole blended or juiced.

Operator

And there are no further questions. So ladies and gentlemen, this concludes our conference for today. We thank you for your participation. You may now disconnect.

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: transcripts@seekingalpha.com. Thank you!