Spark Networks, Inc. (NYSEMKT:LOV)
Q1 2014 Earnings Conference Call
May 12, 2014 16:30 ET
Greg Liberman - Chairman, President, Chief Executive Officer
Brett Zane - Chief Financial Officer
Michael Graham - Canaccord
Ralph Schackart - William Blair
George Askew - Stifel
Greetings, and welcome to the Spark Networks First Quarter 2014 Earnings Conference Call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. (Operator Instructions) As a reminder, this conference is being recorded.
I'd now like to turn the conference over to Mr. Brett Zane, Chief Financial Officer for Spark Networks. Thank you, Mr. Zane, you may begin.
Thank you for joining us today. I'm Brett Zane, Chief Financial Officer for Spark Networks. On today's call with me is Greg Liberman, our Chairman and Chief Executive Officer. Before we begin, there are a few items I need to cover with you. Today, we issued a press release announcing our first quarter financial results. It is available on our company's Web site at www.spark.net in both the Investor Relations and Media Center sections.
In the press release and in our prepared remarks on this call, we refer to adjusted EBITDA, which we define as earnings before interest, taxes, depreciation, amortization, stock-based compensation, asset impairments, non-cash currency translation adjustments for intercompany loans and the income recognized from non-cash assets received in connection with a legal judgment.
Although adjusted EBITDA is a non-GAAP financial measure, we believe it may be useful to investors when evaluating the company's current financial performance. However, investors should not consider adjusted EBITDA as an alternative to net income, cash flow from operations or any other measure for determining the company's operating performance calculated in accordance with GAAP.
In addition, because adjusted EBITDA is not calculated in accordance with GAAP, it may not be comparable to similarly titled measures employed by other companies. A reconciliation of EBITDA and adjusted EBITDA to net income can be found in the consolidated statements of operations included in our earnings release.
I would like to remind everyone listening today that any comments made on this call may contain forward-looking information within the meaning of the Safe Harbor provision of the Private Securities Litigation Reform Act of 1995. Such information is subject to the risks and uncertainties described in the company's news releases and securities filings. The information on this call shall not constitute an offer to sell or the solicitation of an offer to buy our securities. This call is being recorded.
At this time, I will turn the call over to Greg.
Thanks, Brett, and good afternoon everyone. We appreciate your participation as we review our first quarter results and update you on our progress executing our strategic plan. I'm pleased to report that we continue to make meaningful inroads on the profitability side and remain extremely focused on realizing the operating leverage inherent in our business and on driving long-term sustainable cash flow.
On our last call, I said that the growth of our win back and renewal paying subscriber bases, strategic reduction and reallocation of marketing spend and price optimization work should produce improvements in Christian Networks contribution. And despite the headwinds caused by the isolated one-time issues I noted on the last call, our efforts are starting to have a visible impact and contribution meaningfully improved in the first quarter.
Total company contribution grew for the third consecutive quarter to hit its highest level since the third quarter of 2011 and Christian Networks contribution improved more than 80% to register its best performance since the third quarter of 2010. Notably February and March were the first two consecutive months in which we delivered positive contribution for the Christian Networks segment since September 2010, the timing of our Christian Networks subscriber base was only 1/10th as big as it is today.
On our last call, we discussed two issues we believe are now largely behind us. First, let me give you an update on our email affiliate situation. On our last call, I told you that a number of email affiliates have gotten overly aggressive in their practices and several had violated the terms and conditions of our contract since then. Those violations not only let to a clause action lawsuit but also negatively affected our business and brand.
During the first quarter, we continued to work closely with the key consumer email services and our expert third party email marketing service provider, which to be clear, we had also previously been doing to conduct an extensive review of our email affiliate partners and the impacts of their practices on our business and brands. As a result of that work, we learned that email affiliates were having an even more significant negative impact than we had originally thought.
In fact, in addition to creating negative brand perception the third party email affiliates who are also making a materially more difficult for us to get our own first party opt-in email messages into our members inboxes. Examples of the types of emails, we have trouble delivering were notifications that a member had received an email message on JDate or ChristianMingle, alerts that someone had used their profile or secretly admired them through our patented click feature as well as other key engagement and subscription driving emails.
As a result of our rigorous analysis and review, we reallocated our marketing dollars elsewhere and reduced our email affiliate channel even more aggressively than we have originally planned to the point where we currently do not work with any email affiliates on JDate and with only a select few under very restrictive and controlled terms on ChristianMingle.
As a result of those changes, which we implemented in March, we almost immediately saw a dramatic improvement in our own email experience with our members. Today open rates for our email messages on both JDate and ChristianMingle or more than double what they were for the first two months of the year and our open rates are even better than they were before the situation began.
Unfortunately, the email affiliate channels behavior did put the pressure on first quarter registrations, subscriber growth, and revenue which we had anticipated and communicated to you on our last earnings call. But we are confident that those email affiliate related issues are now behind us and most importantly our lines of communication with our members and subscribers are even more open than they were before the problems began.
The second one-time issue we discussed on the last call was a near time impact to renewals that we expected to see as a result of the fourth quarter target data breach that impacted more than $70 million people in the United States. As you are now aware, this issue affected many other companies as well including some of the larger businesses in our industry.
We told you that we believe the issue would be a temporary one primarily affecting Q4 and Q1 and then it would waive. We are seeing that dynamic play out as we anticipate it. And the impact is becoming less and less noticeable.
But in a testament to the growing strength of our Christian Networks business despite the target issue, ChristianMingle renewal rates actually continued to improve on both the sequential and year-over-year basis in Q1. This improvement in part highlights the growing power of our network and subscriber base.
Over the past several quarters, we had spoken with you more and more about the relative proportion of our Christian Networks subscriber base that is composed of first time subscribers, win backs and renewals.
We believe those metrics are and will continue to be valuable and as a result, in today's earnings release, we chose to give our investors a deeper view of those metrics. As you can see from the numbers, Christian Networks renewal and win back subscribers for whom we do not expend incremental marketing dollars now comprise a greater percentage of our total subscriber base growing from 25.2% and 18% respectively in Q1 2013, it's a 31.6% and 19.3% at the end of Q1 of this year.
Separately, we continued to build up on the important marketing attribution work we have discussed on the past several calls to make sure, we leveraged the best tools available for attribution, optimization and allocation purposes. As a result of those efforts, we had seen a meaningful improvement in returns on our marketing investments within the Christian Networks segment.
Before I leave the discussion of our attribution work, I feel it is important to clarify one-related point that seems to have been purposefully mischaracterized by certain members of the investment community. Our third party marketing attribution work is incremental to all of the complex internal tools we have leveraged and continued to use to measure the return on our marketing spend. Those tools, some of which we have built ourselves, some of which we have collaborated on with partners, and some of which are publicly available give us a meaningful competitive advantage and have been critical in helping us allocate capital in the manner we believe is most likely to further our ChristianMingle strategy. In other words, build brand and scale, create community network effect and drive long-term profitable growth.
We are also continue to make progress in our monetization efforts, which are centered on increasing ARPU renewal rate and life time value and are incremental to the work we are doing on the acquisition front. In mid-Q1, we leveraged our dynamic pricing engine to launch a 20-progoned price test. And while we are still in the relatively early stages, we are encouraged by the initial results.
Without delving too far into the details, what is immediately apparent from our testing and our ongoing analysis is that there was additional potential upside from where we are today. We have already implemented some of the new learnings from the test and look forward to talking with you about the results as times goes on.
Over the long-term, we are confident that our pricing optimization works combined with the stabilization of our plan mix and increasing renewal base will combine to drive ARPU improvement. And to that end, another of the additional metrics we began disclosing today was plan mix. So you will be able to monitor our new subscription purchase mix over time as well.
Brett will talk in more detail about the trends and our key metrics in a moment. However, I want to highlight that we intend to provide these new metrics on an ongoing basis. We believe they would be helpful to the financial community and allowing you to benchmark out progress against our strategic plan and aid you in your own internal model. It is also our intention to continue disclose additional relevant metrics over time as we deemed them both valuable too and in the best interest of our stockholders.
In addition to our subscription revenue streams, we remain very excited about and focused on the third leg of our stool, namely, our media and commerce opportunity. With two of the best faith-based distribution platforms online, we have the potential to strengthen communities and drive revenue in areas beyond subscription based dating.
Our Gospel Media Group family of sites is already becoming a powerful engine for marketers who want to reach the Christian community. To that end, overall advertising revenue grew 20% in the first quarter to $737,000 driven by a 28% increase in Christian Networks advertising revenue.
That increase in revenue was driven by improvements in CMPs especially on the programmatic advertising front as well as an increase in traffic to several sites. Notably, during the quarter, faith.com become the second site in our Christian Networks segment to register more than 1 million monthly unique visitors and averaged 1.1 million for the quarter.
If you sum up the gains, we have made on the marketing investment front, continuing renewal rate improvement, progress on our price optimization efforts and our burgeoning media business, you can understand our excitement as we look ahead. Our expectation for long-term revenue and profit growth within the Christian Networks segment is founded upon those pillars.
If our renewal rates continue to improve, fewer subscribers will last, which will provide a solid foundation upon which to grow our subscriber base over time. Additionally, ARPU gains from a more seasoned renewal base, price optimization effort and incremental revenue streams have the potential to drive further top-line growth. And more efficient marketing investments would yield even more gains in contribution and adjusted EBITDA in 2015 and beyond.
Before turning the call over to Brett, I want to touch for a moment on another of our top-five priorities and that is mobile. In Q1, the percentage of log-ins from mobile devices grew year-over-year by 69% and 29% for JDate and ChristianMingle respectively.
And notably in Q1, ChristianMingle hit what our friends at Google call the Mo Moment as the majority of the log-ins to ChristianMingle came via mobile devices. This week, we will launch our brand new mobile optimized site for JDate. And on the heels of JDate revamp mobile Web offering our mobile development calls primary focus will shift back to new native applications that we are developing for both JDate and ChristianMingle on the iOS and Android platforms.
In addition to containing more features than our initial native applications, we will also leverage the new applications as foundations upon which to launch new mobile only features and revenue [streak] (ph). We look forward to announcing those as well as additional exciting investments on the mobile front in the quarters to come.
With that, I will pass the baton to Brett to discuss our Q1 performance at a more granular level.
Revenue was $16.6 million a 4% decrease year-over-year, the decline was primarily attributable to lower subscription revenue from our Jewish and other network segments.
Christian Networks revenue was down 1% year-over-year reflecting a 4% decrease in ARPU offset by 1% increase in average paying subscribers. The lower year-over-year ARPU reflects the shift in subscription sold from one month plans to longer term 3 and 6 months plan starting in the second quarter of 2013. However, we should note that ARPU has sequentially increased for the second consecutive quarter reaching $16.19 up from $16.14 in the first quarter of 2013 and $16.07 in the third quarter of 2013.
The ARPU gains virtually reflect our growing renewal subscriber base and the associated higher APRU that these subscribers generate. As we have mentioned in prior earnings calls, many of our new subscribers purchase longer term plans at promotional pricing. However, when they renew, renewal typically occur at [a lap] (ph) rates which carry higher APRU.
Jewish networks revenue was $6.1 million, a 5% decrease year-over-year. The lower revenue was driven by a 6% decrease in year-over-year average paying subscribers. As Greg mentioned, this decrease was primarily driven by the email deliverability challenges that we experienced during the majority of the first quarter and were a result of aggressive and inappropriate practices at several of our former email affiliates.
Communicating to our members via first party opting emails directly from our company and not affiliates is one of the major drivers for non-paying member to become paying subscribers. It is not only a key tool use to convert new registrants into first time subscribers, but also a significant catalyst for win back activity and engagement.
Since putting this problem behind us, our email open rates are up significantly and we subsequently seen an uplift in our first time subscriber and win back conversion rates. Specifically in March, we experienced 11% and 20% increase in first time subscriber and win back conversion rates respectively compared to the first two months of the year.
Other networks revenue was $610,000, a 25% year-over-year decrease. The lower revenue can be attributed to a 30% decrease in the average paying subscriber base as a result of a 29% reduction in direct marketing spend for this segment.
Total contribution was $5.2 million, a 15% year-over-year increase and a 83% improvement in Christina Networks year-over-year contribution for the growth in total company contribution. The improvement in Christian Networks contribution reflects $1.6 million reduction in marketing spend, coupled with a greater proportion of our paying subscriber base being comprised of win back and renewing subscribers.
As Greg mentioned, we unveiled some additional operating metrics in today's release including the composition of our paying subscriber base. In the first quarter 2013, win back and renewing subscribers represented approximately 44% of our Christian Networks paying subscriber base. By the first quarter of this year, that number had increased 16% to 51%. As the Christian Networks business continues to evolve, we expect that number to move even higher which is reflective of what we have experienced in the Jewish Networks business over time.
We believe the revenue stream associated with win back and renewal subscribers carries little to normal marketing expense.
Jewish Networks contribution was $5 million, a decrease of 12% year-over-year. The decline is directly attributable to the revenue impact from now resolved email deliverability issue as well as non-recurring brand marketing investments for several properties in our Jewish Networks segment.
In the middle of the quarter, we launched our first JDate.com rebranding campaign of 17 years, the Get Chosen campaign. We invested approximately $100,000 and one-time brand related media and creative expense associated with the campaign, which we believe will have a long-term benefit. However, since we do not amortize any of our marketing expense over its useful life, but instead recognize 100% of it in the period it was incurred; investments of this nature by definition disproportionately reduce contribution in a period in which we make them.
In spite of spike in brand marketing investments, our JDate.com properties still generated more than 90% contribution margin in the first quarter. And cross upon, we also made brand related investments in both Israel and France in connection with JDate.co.il and JDate.fr respectively. Those investments increased direct marketing cost by approximately $280,000 year-over-year add some of those non-recurring brand marketing investments Jewish Networks overall contribution would have been $5.4 million or 88% contribution margin. And with the campaigning now launched, we anticipate our Jewish Networks direct marketing spend for the remainder of the year to more closely resemble our 2013 spending levels.
Costs and expenses totaled $19.4 million, down 4% year-over-year. This was largely driven by $1.3 million decrease in cost of revenue partially offset by an increased sales marketing expense. The decline in cost of revenue reflects a planned reduction and reallocation of Christian Networks marketing spend. Christian Networks marketing spend was $10.1 million, a decrease of 14% year-over-year. As we mentioned earlier, the low direct marketing expense plus a reduction in certain online and offline marketing investments, reflecting our focus on driving greater efficiencies and profitability from this segment.
Sales and marketing expenses were $1.6 million, a 24% increase year-over-year. The growth in this line item reflects an increase in compensation expense of $111,000, an increase in consulting fees of $149,000 and an increase in public relations expense of $45,000. The higher compensation expense reflects the expansion of our product, customer acquisition and Christian media business teams in the second half of 2013. The growth in our consulting fees reflects our efforts to build out the Christian media business and services provided by our third-party media attribution consulting firm.
The increase in our public relations expense reflects several JDate and ChristianMingle related branding initiatives including launching our Gift Children campaign and releasing our Annual State of Dating in America Report and participating in several events. We do not expect a similar increase in public relations expense for the remaining quarters of 2014.
General and administrative expenses were $3 million, 8.8% year-over-year increase reflecting higher legal fees associated with our ongoing proxy content. Adjusted EBITDA was a loss of $2.1 million compared to a loss of $2.2 million in the first quarter of 2013. Net loss totaled $2.9 million or a loss of $0.12 per share compared to a net loss of $2.9 million or $0.14 per share in the first quarter of 2013. For the quarter, weighted average shares outstanding totaled $23.9 million compared to $21 million in the first quarter of 2013.
Shifting to our share buyback plans, in the first quarter we repurchased approximately 271,000 shares of common stock at an average purchase price of $5.50 per share totaling $1.5 million. As a reminder, our Board of Directors authorized a $5 million share repurchase plan during the fourth quarter of 2013.
Now, I will turn the call back to Greg for some closing remarks.
Thanks Brett. While I do not believe that our earnings call is a forum to discuss this in greater detail, and we will not take questions on the topic during today's call. I want to briefly address Osmium Partners.
As you know, without offering a controlled premium Osmium has nominated four candidates to take control of Spark's Board of Directors at our upcoming annual meeting on June 18. We take input from all of our stockholders very seriously and are always committed to engaging in a dialog and ways to improve our company. We are also committed to the strategic plan, we have articulated over the past several years. It is already demonstrating clear results for our members and delivering stockholder value.
I was CEO in 2011, I can proudly say that this company has transformed itself and moved aggressively to leverage its strength in niche focus dating to grow ChristianMingle into a power house. It is an authentic brand as a critical mass of subscribers and based upon third-party research, we believe as become far in a way a leading religious dating site with unmatched awareness in its category.
We are just now beginning to drive efficiencies and profitability for the brand, as you have seen demonstrated in today's results. We expect to leverage this success to drive growth across all of our businesses including our more nascent ones, such as the rest of the Gospel Media Group family of sites. As a result of completing the first phase of our strategic plan, we now have a balanced portfolio of niche brands.
During the past three years, we have clearly and consistently articulated our go forward strategies. Strategies that has revitalized the company and taking it in a new direction that has delivered improved results as to speak for themselves. Ultimately, we believe that our efforts will be even more successful and result in even greater stockholder return.
I look forward to continuing to discuss this plan and our strong faith and ability to generate value for our stockholders in my conversations with all of you, including at an upcoming Investor Day, we are beginning to plan for Q3 of this year.
We will both continue to articulate our vision for Spark Networks over the longer term and connect the dots to the present so you can measure our progress towards accelerated and diversified growth in the years to come.
Thank you all for your time to today. That concludes our prepared remarks. Operator, please open up the call for questions.
Thank you. We will now be conducting a question-and-answer session. (Operator Instructions) Our first question is from Ralph Schackart of William Blair. Please go ahead.
Ralph Schackart - William Blair
Good afternoon, and thanks for the additional disclosure, it's really helpful. Two questions, if I could. First, just sort of a little bit of a housekeeping question. On the JDate side, you talked about kind of a one-time brand investment, is that something you have done sort of throughout the years, sort of just to maintain the strong brand, strong affinity or is there something sort of unique to this one-time investment?
We have – so with the Get Chosen campaign, first of all, thanks Ralph. The Get Chosen campaign is the first real rebrand, we have done in 17 years, so we have done brand investment over time for sure. But, the creative and media costs associated with our rebrand are one-time in nature because we haven't done one for 17 years. So I wouldn't expect us to doing another one in the near future, we will leverage that campaign for a long time.
Ralph Schackart - William Blair
Great. And then just kind of looking at some of the newly reported metrics are disclosed, on the Christian Networks side obviously a nice sort of trend and there were no subscribers growing through time. Just curious, is there anything inherently different about this sub-base versus the JDate network where wouldn't expect sort of that trend line to continue over time. And do you get sort of like it was color longer time, do you think that renewal subscriber metric reported tonight could trend near the JDate levels? Thank you.
Ralph, this is Brett. I think that – the original thing that we are seeing that and it's hard because we are in different life cycles between JDate and the Christian Networks. What we have consistently see – have seen and expect to see is, continued improvement in our renewal rates and we think over time what's going to happen is the composition of the paying subscriber base will mimic more the JDate composition as well. So it may take a few years before it gets there, it's not going to happen overnight.
So right now based up on the progress that we have been seeing on the renewal side, we don't see any reason why it wouldn't shift that way.
Ralph Schackart - William Blair
Okay. Thanks again on the incremental disclosure.
Very welcome. Thank you.
Thank you. The next question is from Michael Graham of Canaccord. Please go ahead.
Michael Graham - Canaccord
Made a lot of progress this quarter so congrats on that. Just, I have two questions, one is, can you, I'm just having trouble picturing Greg your comment about how the affiliate emails were making it harder for you guys to speak to sort of win back in renewals, I mean, I could see where the affiliate practices may be a problem when reaching out to sort of new subscribers. But, maybe give an example of how the affiliate emails were making it harder for you to communicate with your win back subs.
And then, just has a follow-up, I just wonder based on sort of what you know about how the email channels are working. Do you have any updated thought about whether the Christian subscriber base should grow or not this year? Thanks.
I will take the first one. So the answer is, we communicate with our own members through email a lot and that typically consists of alert messages like email alerts when someone views you profile, alerts when someone secretly admired you, all of this are engagement driving emails as well as promotional emails. So we have a special promotion going on, we reach out to our members. We also send the match mail things like that.
But what's happening, we learned after working very closely, and again, we were working closely with the email service providers as well as our email marketing service provider very closely even before we fit – ultimately believe in the crust of the problem. But that affiliates behaviors so the fact that affiliates were sending emails on our behalf many of whom again were not following our rules. We are actually impeding our own ability to get our own emails into people's inboxes.
So in other words, certain large consumer email services were basically punishing us for the behavior of our affiliates and therefore blocking some of our emails from getting into people's inboxes. So that's why that affected our ability to communicate with our members which is usually important (indiscernible) we think the magnitude was on the JDate site during the quarter.
But hopefully that answers that piece of your question Mike?
Michael Graham - Canaccord
Could I just follow up on that, could be great. So does mean that your domain like gets put in the penalty box for a while and you have to go through the process with ISPs of getting it sort of unpenalized and like have you already accomplished that or does it take a while to do that?
It happened sort of and not exactly and then it happens very quickly. So when we resolved the problem within three days. Our open rates kicked up dramatically.
And then, so yes, the problem has been rectified, but it will take a little time for us to get there.
The other piece I have to point out to you, just in case you have question about email on – email issues that we are having before as well as that clause action lawsuit. You reach a settlement with everyone involved. So in addition to solving this problem that problem solved. So in fact we don't use email affiliates anymore on JDate. We don't think email affiliates are going to continue to call this a problem. And Brett can talk a little bit about that like I said the magnitude of what we think that meant from a revenue perspective.
We took a look Mike, how it had affected both our conversion rates on first time subscribers and win backs. And we believe the magnitude on JDate loan was about $260,000 in revenue for the quarter that was related to that deliverability issue.
Michael Graham - Canaccord
Okay. That's helpful. And then how about the thought about Christian growing or not growing this year, Brett?
I think we are going to probably stick to the game plan that we discussed on our Q4 earnings call. There will probably contraction on the paying subscriber base there. We are pulling back on our marketing spend. I think we said on our Q4 call that it was going to be between 10% and 20% in our marketing spend and so that's going to have an effect on a little bit of a contraction in our paying subscriber base on Christian. The marketing spend probably will be down somewhere between 15% to 20% would be my guess right now based up on what we did in Q1. And what we are seeing out there.
Michael Graham - Canaccord
Okay. All right. Thank you very much guys.
Thank you. The next question is from George Askew of Stifel. Please go ahead.
George Askew - Stifel
Yes. Thank you and appreciation for the increased transparency here. Of the one month, three months and six months plans which are the most likely become a win back or renewal?
I don't think – our experience typically is that, you get your highest renewal rate half of someone buy the1 month plan. However, the person that buys the six month plan and renews, renews for another six months so you are having for a longer period of time.
So it's kind of difficult to answer that question without understanding some of the dynamics like go along with it. What we have experienced though is that, the LTVs that we get from the three and six month purchasers are higher than the one-month purchasers.
George Askew - Stifel
Okay. Okay. And over the last four quarters are so, you reduced the mix of ChristianMingle first time subs by almost 7 percentage points, as we look forward the next four quarters and beyond, I mean that kind of a reasonable pace to expect as you sort of start to move universal subscribers to a little bit more like JDate for example?
I know, it's not necessarily linear, but I think that trend is going to continue there maybe an up and down from time to time George just stays upon when long-term plans are coming up for expiration and renewing. But I think that the trend that you are seeing is historically is going to continue on throughout 2014.
George Askew - Stifel
Okay. And then one last one, just on ARPU, you had a nice obviously increase in the mix of win backs and renewals at Christian in the last two quarters yet APRU increased just very modestly, did you see any impact from pricing optimization in the quarter or the tests you mentioned the only – the only one real activity that you had there and should we be seeing a bigger ARPU lift from the win backs and renewals which of course you mentioned are usually renewed at the rack rate?
I will tackle a couple of these items. And Greg will jump in. Typically, George, first of all, the ARPU that usually comes from the renewals base not the win back base. Secondly, I think that the price testing that we have done has been very encouraging. And we have done a lot of different slices on it. And so it's been to limited populations and so based upon our learnings, we are now introducing it to larger populations to make sure that our planning's are actually are valid over a large universe of people. And so that takes a little time for to get push through the system. But our expectation is, as we roll this out to broader part of the population, we should see an uplift in our ARPU but that probably happened more towards the second half of the year.
I think the other piece of this key relative to ARPU is the stabilization of the plan mix. So as more people have shifted into longer term plans even though those people when they renew how higher ARPUs when they purchase, people who buy a six month plan have a lower ARPU than people who buy a one month plan. So that make shift as meaningful and stabilizes and the renewal based on seasons. Then you will see more of that.
George Askew - Stifel
Okay. Great. Thank you very much.
Thank you. We have no further questions at this time. Ladies and gentlemen, this does conclude today's teleconference. You may disconnect your lines at this time. And thank you for your participation.
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