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Executives

Peter C. Broadbent - Vice President of Investor Relations & Marketing

Constantine S. Macricostas - Chairman and Chief Executive Officer

Peter S. Kirlin - President

Sean T. Smith - Chief Financial Officer, Principal Accounting Officer and Senior Vice President

Christopher J. Progler - Chief Technology Officer and Vice President

Analysts

Y. Edwin Mok - Needham & Company, LLC, Research Division

Patrick J. Ho - Stifel, Nicolaus & Co., Inc., Research Division

Thomas Diffely - D.A. Davidson & Co., Research Division

Photronics (PLAB) Q4 2013 Earnings Call December 11, 2013 8:30 AM ET

Operator

Ladies and gentlemen, thank you for standing by. Welcome to the Photronics Fourth Quarter Earnings Call. [Operator Instructions] As a reminder, this conference is being recorded Wednesday, December 11, 2013.

I would now like to turn the conference over to Pete Broadbent, Vice President, Investor Relations and Marketing. Please go ahead, Mr. Broadbent. You may begin.

Peter C. Broadbent

Thank you, and good morning, everyone. I'd like to thank you for joining our fourth quarter 2013 conference call.

Before we begin, I'd like to remind all participants about the Safe Harbor provision under the Private Securities Litigation Reform Act of 1995. And thus, any statement we make during this call, except for historical events, may be considered forward-looking and may be subject to certain risks and uncertainties that could cause actual events to differ materially from those projected, including uncertainties that may affect the company's operations, market, pricing, competition, procurement, manufacturing efficiencies and other risks detailed from time to time in the company's SEC reports. These statements will contain words such as believe, anticipate, expect or similar expressions. This call will be archived on our website until we report our first quarter 2014 results.

Joining us on the call today are Constantine Deno Macricostas, Chairman and Chief Executive Officer; Dr. Peter Kirlin, President; Sean T. Smith, Senior Vice President and Chief Financial Officer; Dr. Christopher Progler, Vice President, Chief Technology Officer and Strategic Planning. Also joining us on the call today is Dr. Frank Lee, President of PSMC.

During our remarks this morning, we will be referring to slides posted on our website under the Investor Relations link.

And now, I'd like to turn the call over to Deno Macricostas. Deno?

Constantine S. Macricostas

Thank you, Pete, and good morning, everyone. I would like to begin by highlighting a few of our major accomplishments here and then I will turn the call over to Peter Kirlin, who is promoted to the position of President during the quarter. Peter will speak to our results in the fourth quarter and the trends we see in the market.

Since the beginning of 2013 through today, we completed a number of strategic moves that position us for future growth. We successfully completed our tender offer for the outstanding shares of PSMC. We entered into a JV agreement with the DNP in Taiwan, which will give us access to high-end logic technology, a faster growth and higher revenues. The JV immediately strengthens our network for serving key customers in the region, including Micron and affiliates, UMC, SMIC and GLOBALFOUNDRIES.

The restructured loan agreement will give us more financial flexibility while reducing expenses. We successfully deployed additional capital equipment to serve our high-end customers globally.

The result is our footprint now represent the largest installed base of 14-nanometer cable equipment of all dimensions. We have invested more at this stage than our 3 largest competitors combined. And we're investing in line with our customer roadmaps, while maintaining a strong net cash position and balance sheet.

While fiscal 2013 was a growth year, we expect a -- we took significant strategic actions that position us well for future growth. So from that perspective, it was an excellent year for Photronics. Reticles were up operationally and performed well on the bottom line. We'll continue to use our cash strategically while reducing our debt and building our working capital. Importantly, we put the key pieces of our strategic plan in place this year to capitalize on the expected ramp in the high-end next year.

In summary, we are very optimistic about 2014. We have established strong partnership with key customers. Our JV will bring opportunities for accelerated high-end growth, we have a favorable banking arrangement, and we are very well positioned in the marketplace by investing in high-end. As a result, I'm very excited about the opportunities ahead for the company.

And now, I would like to turn the call over to Peter. Peter?

Peter S. Kirlin

Thank you, Deno, and good morning everyone. Please turn to Slide 3 in our slide presentation. In Q4, we achieved sales of $106 million, at the top of our revised guidance. Sean will provide a detailed breakdown of our financials but first, a few highlights and some comments on the trends in our business.

The general trends in the semiconductor [indiscernible] and photomask markets, are positive. During the quarter, we had solid momentum in our FPD and mainstream IC businesses. FPD sales of $26.2 million were up 3% sequentially, with 11% growth in the high-end. IC mainstream sales grew $3 million or 5% sequentially, which is a solid quarter for us. The $64.2 million of mainstream sales represent the highest quarter for us in 2 years.

Our challenge in Q4 was the high-end IC sales and reflects the transition we continue to face with 2 key customers. As we have discussed previously, in memory, the volume in reticle demand linked to new designs for next-generation devices was light because the wafer fabs have been running essentially flat out with existing chip designs. In addition, we have yet to receive the boost from new demand that we expect from one of our largest customer's recent acquisitions. Both of these factors contributed to this short-term delay in, but not a loss of, some high-end photomask sales.

On the foundry side, we had expected to start seeing revenues resulting from the qualification of one of our largest customers at the 28-nanometer node. We did not complete this qualification on schedule. As of today, we expect to qualify during the current quarter.

Our relationship with this customer remains solid and we have started to qualify at the 14-nanometer node. We expect to see sound demand in 28 nanometers as soon as the qualification is complete and at 14-nanometer when this customer initiates that node migration. The high-end opportunities that these and other customers give us reason to be enthusiastic about our future.

On the operations side of the business, our management team is relentless on controlling costs. Even with the top line decrease, we were profitable in generating cash. We delivered gross and operating margins of 25.2% and 7%, respectively. We generated non-GAAP earnings of $0.09 per share, which exceeded our revised guidance. Non-GAAP EBITDA was $27 million and we improved our net cash position by $18 million, sequentially.

So despite a softer-than-expected quarter, we continue to generate profits and improve our cash position. Also, with our deployment of capital in strategic markets and our agreement to form a joint venture in Taiwan with DNP, we strengthened our position in the marketplace and are poised for growth.

In the near term, the team is laser-focused on executing on a number of customer qualifications. We have significant opportunities in front of us with our key customers, and we are working intensely to capitalize on them. We will continue to execute our strategy in mainstream IC and FPD to extend our share gains. And we will maintain our vigilance in controlling expenses.

Looking forward, we expect 2014 to be a strong year for us. As Deno mentioned, we've achieved key milestones in our strategic plan, our customers are making progress in node transitions and we are focused on delivering growth and value for our shareholders.

I will -- and now, I would turn the call over to Sean.

Sean T. Smith

Thanks, Peter, and good morning, everyone. I'll provide a brief analysis of our financial results for the fourth quarter, review our balance sheet and cash flows, discuss our forecast and also provide additional information on the recently announced Taiwan JV.

Please refer to Slide 4 for our GAAP to non-GAAP net income and EPS reconciliation as we review the fourth quarter. For purposes of our discussions, I will be primarily comparing our non-GAAP operating results to the revised fourth quarter guidance we published in our November 13 press release.

Slides 5, 6 and 7 show our sequential quarterly and year-to-date IC and FPD revenue performance. Fourth quarter revenue decreased by 3.3% sequentially to $106 million for the reasons Peter discussed. Revenues for IC photomask were $79.8 million, down $4.3 million sequentially for the fourth quarter, while FPD photomask revenue increased 700k sequentially to $26.2 million.

Breaking out sales geographically, 62% of total sales were from Asia, 27% from North America and 11% from Europe. High-end global IC sales were $15.6 million or 20% of total IC sales for the quarter. This represents a sequential decrease of $7.3 million. Global mainstream sales increased sequentially by $2.9 million or 5%.

Advanced FPD sales increased by $1.8 million to $18.5 million or 71% of total FPD sales. As a reminder, high-end IC revenues consist of revenue derived from semi-designed at and below 45-nanometer, and high-end FPD revenues consist of revenue at and above G8 as well as AMOLED-based products.

Now let's continue through the income statement. Gross margin for the fourth quarter was 25.2%, up 50 basis points sequentially. The increase was primarily related to certain manufacturing costs reallocated to R&D as a result of the increased qualification activity.

Selling, general and administrative expenses for the fourth quarter were $12.9 million, up sequentially by $900,000, primarily as a result of approximately $800,000 of expenses directly related to the JV.

R&D expenses, which consist principally of continued development for our global advanced process technologies and qualifications at advanced nodes, were $6.4 million, up $1.4 million sequentially, primarily as a result of increased qualification activity, including the Asian foundry qual that Peter discussed.

During the quarter, we generated operating income of $7.4 million or 7% of sales. Excluding the costs related to the JV, operating income was $8.2 million or 7.7% of sales. Sequentially, operating margin was down 50% of the decreased sales for the quarter.

Please turn to Slide 8. EBITDA, as defined in our credit agreement, for the quarter was $26.6 million and for the year was $110 million. Also for the year, free cash flow was $46 million, which is EBITDA of $110 million less our non-financed cash CapEx of $64 million.

Other income and expense for the fourth quarter was expense of $1.4 million, up $400,000, sequentially. And during the fourth quarter, we recorded a tax provision of $1.1 million.

GAAP net income was $4.8 million or $0.08 per diluted share and non-GAAP net income, excluding the JV transaction expenses, was $5.6 million or $0.09 per diluted share, higher than our revised guidance of $0.06 to $0.07 per share.

At the end of the fourth quarter, we have 1,300 full time employees, which was essentially flat with the end of 2012. This equates to revenue per employee of $326,000 on an annualized basis.

Now turning to the balance sheet. Despite missing our initial guidance and decreased sequential operating results, our balance sheet actually improved sequentially. Cash and cash equivalents at year-end amounted to $216 million and our net cash, which is cash less debt, was $22 million or up $18 million sequentially.

Our working capital at the end of the quarter was $214 million, which was up $22 million sequentially compared to Q3. And accounts payable and accrued current liabilities at year-end amounted to $93 million. And at the end of the quarter, $90 million of CapEx was accrued for, down $11 million from the third quarter of 2013.

Please turn to Slide 9 as we review our capitalization. As Deno mentioned, on December 5, we announced we entered into a 5-year $50 million revolving credit facility and the repayment of a $21 million term loan, which was previously due in 2017. The new credit facility provides for increased financial flexibility, reduced interest rates and relaxed financial covenants.

Total debt at the end of the year was $194 million, of which $21 million was paid on December 5 as part of the new revolving agreement. The principal components of outstanding pro forma debt include: $22 million of a 5.5% senior unsecured convertible note due in October of 2014; $115 million, 3.25% senior unsecured note due in April 2016; approximately $11 million for capital lease obligation; and approximately $25 million related to a capital lease for an e-beam tool. As of today, we do not have any borrowings outstanding on our new 5-year $50 million credit agreement.

Taking a look at our cash flows. Cash provided by operations for the fourth quarter was approximately $32 million. Depreciation and amortization was $17.9 million for the quarter. And for fiscal 2013, cash provided by operations was $99 million.

Cash flow used in investing activities during 2013 amounted to $16 million and $66 million for 2013. In fiscal 2013, cash used in investing activities includes $64 million of cash CapEx.

Net cash used by financing activities during the quarter, amounted to $4 million and $40 million for fiscal 2013, of which $32 million related to the PSMC take-private transaction that Deno discussed and $8 million related to repayments of debt.

Please refer to Slide 10 and 11. On November 20, we announced the formation of a noncash joint venture with DNP in Taiwan. In essence, DNP will be merged with DNP's -- PSMC will be merged with DNP's Taiwan subsidiary, DPTT. The joint venture is subject to regulatory approvals and closing conditions and is projected to be finalized in the first half of fiscal 2014.

Let me highlight some of the key provisions of the JV. Photronics will own 50.01% and consolidate the JV in our financial statements. Photronics will manage and control the JV. This is absolutely critical to our ability to be successful with our high-end strategy. We estimate that our top line will grow by at least $80 million annually, with the vast majority of revenue being comprised of high-end IC products. The JV will have a well-capitalized balance sheet and should be self-sufficient. During the quarter, we did incur approximately $800,000 in expenses related to the transaction. And we expect to incur $1 million to $2 million in additional expenses related to the JV prior to the closure.

We do expect to extract annual cash synergies of at least $5 million to $7 million beginning within 2 quarters of the JV formation, and we expect the JV to have an accretive impact to the bottom line and EBITDA in fiscal year 2015, if not sooner.

Please turn to Slide 12 as we take a look ahead. We expect our cash CapEx needs for 2014 to be in the range of $70 million to $90 million. We do, however, have the flexibility to accelerate or decelerate our spend depending on market conditions.

We expect to continue to generate free cash flow once again in 2014. And our 2014 investments will principally be geared towards high-end leading-edge products for IC and FPD applications.

Our visibility, as always, continues to be limited as our backlog is typically 1 to 2 weeks. For Q1 2014, we do expect to experience some reduced orders related to the typical year-end holiday seasonality. So taking this all into consideration, we are projecting revenue for the first quarter of 2014 to be in the range of $103 million to $107 million.

During 2014, our tax rate will be affected by the flow of income from jurisdictions for which we may have tax credits and upon our limited ability to recognize tax benefits in the areas in which we are taxable. For the first quarter of fiscal 2014, this will equate to a range of $1 million to $2.5 million. For fiscal 2014, we estimate total taxes will range from $12 million to $15 million.

As a result, based upon our current operating model, we estimate earnings per share, exclusive of any JV transaction costs for the first quarter of 2014, to be in the range of $0.06 to $0.10 per diluted share.

In summary, I'll leave you with a few key thoughts. First, we expect the top and bottom line improvement in 2014 and to continue to expect to generate free cash flow. Second, we are confident about our business model and our ability to grow market share at the high-end. We see continued opportunities in our customers' businesses and node migration plans, and we have a strong financial position and excellent technology to capitalize on those plans.

And finally, we expect to continue to build on the momentum that we have established over the past few years as a leader in advanced photomask technology.

Now I'd like to turn the call over to the operator for questions and answers.

Question-and-Answer Session

Operator

[Operator Instructions] And the first question is from Edwin Mok of Needham & Company.

Y. Edwin Mok - Needham & Company, LLC, Research Division

So Sean, first question actually I have for you is, how do we kind of think about -- given that you guys will be considering a joint venture following the -- maybe in the April quarter according to your commentary, right, how do you kind of think about what impact or benefit do you expect to gain from the joint venture in terms of effect on your gross margin and operating expenses?

Sean T. Smith

I think initially, Edwin, depending upon when the JV closes, certainly, the top line will grow immediately. And then, as we extract synergies, we would expect our operating gross and operating margins to improve. So the timing of the closure of the JV will have an impact on 2014.

Y. Edwin Mok - Needham & Company, LLC, Research Division

Right, I understand. Maybe a different way to think -- ask that is if I look at the back half '14 when you expect to have the joint venture closed, right, do we expect gross margin to be at a higher level than where we're at right now, and also operating margins?

Sean T. Smith

We expect, on a standalone basis, our gross and operating margins to be higher year-over-year, certainly in 2014. To the extent the JV closes earlier in the year, we would expect them to be higher as well for 2014. It's all in the timing of the closure of the JV.

Y. Edwin Mok - Needham & Company, LLC, Research Division

I see. Okay, that's helpful. And then I guess a question on the marketplace. So for the quarter, you guys have come light at high-end and you mentioned that memory was a contributing factor beyond the qualification into a customer, right? And January is seasonally a slow quarter. How do you kind of think about memories spending on photomask as we go beyond the January quarter? And specifically on the high-end, do we expect that to come back and contribute and bring your high-end revenue -- excluding the JVs, bring your high-end revenue back to $20 million-plus range that you have reported previously?

Sean T. Smith

Yes, Edwin, we expect, as we enter the new calendar year, to start to see our memory business benefit from a significant node transition. So towards the end of the first quarter and then moving forward in the year, the memory business, we expect to improve sequentially. And by the time we get into the third quarter, it should be quite strong.

Y. Edwin Mok - Needham & Company, LLC, Research Division

Is that largely due to one, your joint venture customer is to come, doing this node transition, in the DRAM side or is it some other factors that you guys have looked in?

Sean T. Smith

I think you understand it correctly.

Y. Edwin Mok - Needham & Company, LLC, Research Division

Okay, that's helpful. And then lastly, any kind of additional update you can provide in terms of qualification of the customer on -- the logic customers that you guys have talked about? Do you guys -- is the equipment installed? Are you still going through the qualification? When do you kind of expect that to be completed? Is any timing of customer investment or spending could -- would that have an impact on kind of when you expect January revenue after you had qualified?

Sean T. Smith

Yes. I think in the past what we have demonstrated is, once we get qualified, we ramp quite quickly on a node regardless of the customer. And in this particular case, there is no customer issues that would, in any way, impact our ability to do that. So once the qual completes, we expect to ramp business with them immediately.

Y. Edwin Mok - Needham & Company, LLC, Research Division

In terms of timing of qualifications, do you have any kind of target for that?

Sean T. Smith

Yes. What we said is it didn't occur this quarter as we had expected. What we didn't say is we understand why it didn't work. We fixed it and we're expecting that the qual is going to conclude by the end of the quarter.

Operator

And our next question comes from the line of Patrick Ho of Stifel, Nicolaus.

Patrick J. Ho - Stifel, Nicolaus & Co., Inc., Research Division

Maybe just going back to the foundry qualification situation. As you move from 28 nanometers to 14 nanometers, are there any additional "tool sets" or any additional changes that need to be made there that could change the dynamics of that qualification process going forward?

Sean T. Smith

At the 14-nanometer node, we have customers in various stages of, what I would describe as, maturity on their way for process flow. So for example, our most leading customer, their tool set is fully stable and we're far beyond the midway point on that particular qual. In that case, it's basically locked down, bulletproof, don't expect any changes. We have other customers that are -- where we're early in, some haven't started. The ones that haven't started, obviously, are tools set not solidified. The ones that are really in could still change. So right now, the 14-nanometer logic node is bulletproof in some cases, fluid in others.

Patrick J. Ho - Stifel, Nicolaus & Co., Inc., Research Division

Okay, great. Maybe a question for Chris in terms of the technology and, especially, as we look at 2014 on the NAND Flash side of things. As the industry begins to transition to 3D NAND and you're hearing more chatter from not only the first player involved but others now potentially bringing on their capabilities as 2014 progresses, what are some of the mask implications of that transition given that there's going to be an increase of layers as you basically flip them over? And maybe if could just give me a little bit in terms of both, I guess, the technology process and what some of the potential opportunities are going forward.

Christopher J. Progler

Sure. Thanks, Patrick. We are qualifying and actually qualified for some of the vertical NAND devices already, the so-called 3D NAND. So we know those flows very well. There are more mask layers per device, generally, more non-critical layers as well. There are some specifications for the mask that actually get a little tighter than the previous floating gate planar NAND and then some of them relax as well. We've analyzed it pretty closely and, in total, there's not that much of a difference from a total mask perspective between scaling with standard planar floating gate NAND and 3D NAND. We should see more layers, but some of the layers will be a little easier to manufacture. So in total, we don't see big differences between these. The most important thing is the roadmap continues to scale, the node transitions continue to happen in NAND, which we believe will -- is occurring and on, also, a pretty aggressive basis. So I would say it's kind of business as usual for the most part for masks and perhaps some upside from the part of units as the 3D transition unfolds in 2014.

Patrick J. Ho - Stifel, Nicolaus & Co., Inc., Research Division

Great. And final question for me in terms of your high-end opportunity, primarily on the IC side of things. Given that this joint venture allows you to get even greater penetration on the high-end, have you seen any changes on the competitive landscape because of your increasing share at the high-end or have things kind of been pretty, I guess, rational at this point?

Sean T. Smith

The marketplace is, to use your words, rational. The opportunities that we have seen -- the fact that we are starting to separate ourselves is now becoming very clear. So in the business opportunities that we're actively engaged in, what we really see is more willingness of the customers to work with us to accelerate what we're currently doing because they see that now, even more than before, as time well spent.

Christopher J. Progler

Yes. One thing I might add Patrick, on the competitive side. As Deno mentioned in his comments, from an investment point of view, when you look at the high-end 14 nanometers, as far as the capacity and the technology to service that node, for sure, we're best positioned. So there's always competition and that won't change. But on the other hand, we have a very strong position in our infrastructure and the JV adds to that. So we're fairly confident we're well positioned there.

Operator

[Operator Instructions] And the next question is from Tom Diffely of D.A. Davidson.

Thomas Diffely - D.A. Davidson & Co., Research Division

So first, Sean, a question on your capital spending, the $70 million to $90 million, is that earmarked initially for high-end IC like it has in the last couple of years?

Sean T. Smith

I think what we stated in the past that the revenue differential between IC and FPD is sometimes 75%, 25%. So we generally, I believe, stated that our CapEx spend is roughly about that split. Certainly, we do expect to see some significant growth on the high-end IC side. We've actually invested, as you most people are well aware, on some leading-edge lithography and inspection tools that were installed in 2013 that we expect to benefit from a revenue ramp in 2014.

Thomas Diffely - D.A. Davidson & Co., Research Division

Okay. So as revenue ramps over the next few quarters, what is the capacity that's currently in place for the type of revenue that's making that support?

Sean T. Smith

Certainly, well in excess of what we ended the quarter and we have high goals without giving specific guidance for the full year, but we do expect to see substantial growth as we move out into Q2, Q3. I think Peter mentioned that in his remarks.

Thomas Diffely - D.A. Davidson & Co., Research Division

And as far as the growth that you're seeing for 2014, is that already accounted for with your capital in place or do you need to spend more to get that capacity in place? I guess, what I'm again asking, is the $70 million to $90 million for this year capacity or is it out-year capacity?

Sean T. Smith

It's a combination of both.

Thomas Diffely - D.A. Davidson & Co., Research Division

Okay. And also, this morning you talked about some strength, relative strength, in the mainstream business. Do you think that's sustainable going forward or what are the dynamics there?

Sean T. Smith

The strength in the mainstream business is, I think, a bright spot for us year-over-year. We actually saw a slight increase in revenues in a market where the units are clearly decreasing. So we're picking up market share there. And our objective is to continue to do that. Having said that, as everyone on the phone knows, our business really sings when we execute on all cylinders and that's our focus in the coming year, not 1 or 2, but all. Like in the [indiscernible] on mainstream side, the improvements, certainly in the balance sheet or the cash flow generation, is driven quite a bit by the mainstream business, which is a cash cow and allows us to invest for leading-edge capacity.

Thomas Diffely - D.A. Davidson & Co., Research Division

Okay. I guess, on those slides, too, what does 2014 look like from a flat panel business point of view, both mainstream and high-end flat panel?

Christopher J. Progler

Yes. This is Chris, I can make a few comments on the high-end part of it. 2013 was a strong year for flat panel, high-end in particular, and that includes the AMOLED work. Our largest customer there seems to be very intensely working on new designs for AMOLED. Still mostly in the mobile space, but a lot of new design work on tablets, some new curve display things coming out that are based off AMOLED technology. So to the extent all of those things go into mass production, then it should be also, 2014, quite a strong year on the high-end display side. On mainstream side, Sean, maybe has some comments.

Sean T. Smith

Yes. Where we saw the growth this year was, as Chris alluded to, is on the high-end side, particularly centered with our 2 Korean-based customers. Mainstream business is primarily centered in Taiwan and, to a lesser extent, Korea. And that's a little bit more, as we talked about in the past, competitive and commodity type pricing.

Thomas Diffely - D.A. Davidson & Co., Research Division

Okay. And last question, Sean, does the joint venture impact long-term tax -- having long-term tax implications?

Sean T. Smith

Actually, we expect the JV to have some preferential tax benefits when it closes, so it should only improve the overall effective rate.

Operator

[Operator Instructions] And the next question comes from Edwin Mok of Needham & Company.

Y. Edwin Mok - Needham & Company, LLC, Research Division

Sean, I have a question about the R&D. What happened last quarter? How come it went up so much?

Sean T. Smith

We had some increased qualification activity that caused it to increase.

Y. Edwin Mok - Needham & Company, LLC, Research Division

I see. Is this something that you expect to moderate? I mean, obviously, excluding the effect on foundry, is it something that you expect to moderate after the qualifications are completed?

Sean T. Smith

I would expect it to go back to the levels that it had previously. But to the extent that it stays where it's at and it's with other new applications, it bodes well for our future as well.

Peter S. Kirlin

Yes. But to add to Sean's commentary, there was a great effort to fix the problem that we had. And to some extent, the spend reflects that.

Operator

Ladies and gentlemen, there are no further questions at this time. I'll turn the call back over to Mr. Macricostas for closing remarks.

Constantine S. Macricostas

Thank you for participating in this morning call, and I would like to thank Photronics employees for their dedication and hard work this past year. I'd like to wish everyone happy holidays and a prosperous new year. Thank you.

Operator

Ladies and gentlemen, that does conclude our conference call for today. We thank you for your participation, and we ask that you please disconnect your line at this time.

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