Seeking Alpha
We cover over 5K calls/quarter
Profile| Send Message|
( followers)

Meadowbrook Insurance Group, Inc. (NYSE:MIG)

Q3 2010 Earnings Conference Call

November 2, 2010 9:00 AM ET

Executives

Karen Spaun – CFO

Bob Cubbin – President and CEO

Analysts

Beth Malone – Wunderlich Securities

Ken Billingsley – BGB Securities

Scott Heleniak – RBC Capital

Tom Spiro – Spiro Capital Management

Bijan Moazami – FBR Capital Markets

Operator

Greetings and welcome to the Meadowbrook Insurance Group Incorporated Q3 2010 Conference Call. At this time, all participants are in a listen-only mode. A brief question-and-answer session will follow the formal presentation. (Operator Instructions). As a reminder, this conference is being recorded.

It is now my pleasure to introduce your host, Ms. Karen Spaun, CFO for Meadowbrook Insurance Group Incorporated. Thank you.

Ms. Spaun, you may now begin.

Karen Spaun

Thank you, and welcome to Meadowbrook Insurance Group’s third quarter 2010 earnings conference call. I will lead off today’s call with a review of our financial results. Bob Cubbin, our President and CEO will then follow with a review of our financial outlook and current market conditions. The call will conclude with a question-and-answer session.

During this call, we may make certain statements relating to the future results and expectations. These statements constitute forward-looking statements as defined under the Private Securities Litigation Reform Act of 1995. We, therefore, must state that actual results may differ materially from those projected and may involve risk and uncertainties that are outlined in our Forms 10-K and 10-Q that are filed with the SEC. Please note Meadowbrook undertakes no obligation to update or revise any forward-looking statement.

If you have not received a copy of our earnings release, it is currently available on our website meadowbrook.com, or you may give me a call and I will be happy to email a copy to you.

Before reviewing our results, I will take a moment to discuss some changes we made to the presentation of the expense line items on our income statement. In 2010, we completed an in-depth cost allocation study and made refinements to our process to track these costs on a functional basis. The purpose of the study was to align our internal expenses with those activities they support such as underwriting and related policy administration, claims administration or otherwise referred to us ULAE, general, selling and administration costs associated with the production and management of net commission and fee revenue, and general corporate expenses.

Upon completion of the study, we have the information to better define our intercompany fees and treat these fees as intercompany cost reimbursements for financial reporting purposes. This enabled us to align the consolidated results with the underlying nature or function of the internal expenses. Previously, we used estimations based upon an overall cost study that focused on intercompany fees in total and the reasonableness of the split between claims administration and policy administration costs.

These reclasses were made to enable the user of the financial statements to calculate the GAAP combined ratio directly from the consolidated statement of income. As a result, the consolidated statement of income for the three months ended September 30th, 2009 has been reclassified to conform to this presentation. These reclassifications do not change total expenses or consolidated net income as originally reported for the three months ended September 30th, 2009. Please refer to our Forms 8-K filed on May 3rd, 2010 for further details.

For the three months ended September 30th, 2010 this refinement resulted a in 2.3 percentage point increase in the expense ratio, a 1 percentage point decrease in the loss and LAE ratio, and a decrease of $2 million in general, selling and administrative costs.

Now, with the results. We are pleased with the third quarter results as we continue to achieve profitable growth in a competitive environment.

Net operating income increased 25% to $14.6 million from $11.7 million in the third quarter 2009. This equates to an increase in operating income per share of 35% to $0.27 per share, compared to $0.20 per share in 2009.

Net income increased 36.5% to $15 million compared to $11 million for the third quarter of 2009. This equates to an increase in net income per share of 47.4% to $0.28 per share compared to $0.19 per share in 2009.

Revenues increased $35.6 million or 22.2% from a $160.2 million in the third quarter of 2009 to a $195.7 million in 2010. This increase reflects growth in net earned premiums from the business that we implemented in the second half of 2009.

Our 2010 third quarter GAAP combined ratio was 95.9%, which is comparable to the third quarter of 2009. Our expense ratio increased 2.9 percentage points to 34.3% for the three months ended September 30th, 2010 from 31.4% for the same period in 2009. After adjusting for the previously mentioned reclassification the expense ratio would have just increased 0.6 percentage points. This reflects an increase in external costs primarily relating to net commission expense relating to new business added in the second half of 2009 where the agent performed and is paid for certain policy issuance functions.

The third quarter of 2010 loss and loss adjustment expense ratio was 61.6% compared to 64.5% for 2009. The 2010 results include 4.2 percentage points, a favorable development as compared to the 2009 results which include 4.5 percentage points of favorable development. The accident year loss and LAE ratio was 65.9% compared to 69% in 2009. The improvement in the current accident year loss and LAE ratio reflects a decline in storm related losses and a single fire loss totaling $5.7 million that occurred in 2009.

As previously mentioned, Bob will be discussing the pricing environment during his prepared remarks.

General, selling and administrative expenses decreased $2.4 million from $8.3 million in 2009 to $5.9 million in 2010. The decrease reflects our ability to leverage fixed cost. During the third quarter 2010, net investment income increased by $900,000 to $13.7 million, compared to $12.8 million for the third quarter 2009. The increase is primarily due to a higher average invested assets and continued positive cash flows from operations.

The pre-tax book yield was 4.5% at September 30, 2010, compared to 4.7% at September 30, 2009. The effective duration of our fixed income portfolio is 4.8 years compared to 4.7 years in the prior year. The duration of our reserves is 3.2 years. In 2009, we made a 28.5% minority investment in an insurance company related agency. For the third quarter of 2010, the after-tax equity earnings on this investment were $425,000 or $0.01 per share.

Book value per share at September 30, 2010, increased 15.7% to about $10.48 per share, compared to $9.06 per share at December 31, 2009. Book value per share, excluding unrealized gains, increased $0.77 per share to $9.36 per share at September 30, 2010 from $8.59 per share at December 31, 2009.

At September 30, 2010, our combined statutory surplus was $374.6 million, compared to $351.8 million at December 31, 2009. At September 30, 2010, our trailing 12-month gross written premium to surplus ratio was 2.1 to 1 and net written premiums to surplus was 1.8 to 1. As a reference point, our targets for gross written premiums to surplus and net written premiums to surplus are 2.75 to 1 and 2.25 to 1 respectively.

Our capital position remains strong as we continue to generate profits and are able to fund dividends, share repurchases and debt serviced from our earnings. During the quarter, we increased our quarterly dividend by 33.3% to $0.04 per share. We also repurchased 323,000 shares at an average cost of $8.46 per share. These repurchases increased book value by $0.01 per share.

Tangible book value per share which excludes goodwill and other intangible assets increased by 22.2% to $7.54 per share compared to $6.17 per share at December 31, 2009. Please refer to the earnings release for further details on a line by line analysis of the third quarter consolidated income statement.

With that I will turn the call over to Bob Cubbin, our President and Chief Executive Officer, Bob?

Bob Cubbin

Thanks Karen, and good morning everyone. We have continued to deliver strong results through 2010. The third quarter revenue is up 25%, our combined ratio at 95.9 and net operating income at $0.27 per share. We remain focused on underwriting discipline in an ongoing competitive environment and are writing profitable business at adequate price levels.

Over the years, we have built our business to create both geographic and product diversification. We believe this approach has enabled us to deliver strong performance through the current prolonged soft market and positions us to leverage our platform more fully when the market shifts.

Growth during the third quarter was primarily the result of new initiatives that were launched in the second half of 2009. This additional premium is complementary to our overall book of business and adds to our prospects for future growth.

While we continue to increase revenue, our primary focus remains disciplined underwriting and pricing adequacy. The majority of our new business has been from the rollover of existing book to business that have a proven history of profitability. In many cases, including our California workers compensation initiative, we have been able to increase rates in addition to what was previously charged. While most of our programs and admitted business continue to grow, the market for excess and surplus lines insurance has remained competitive. However, we are encouraged by the most recent signs as rates were stable and our year-over-year premium buying has increased modestly.

Overall non-E&S rates increased modestly in the first nine months of 2010. Our workers’ comp rate overall were up 4.8%; and on the roll-over business in California, rates were up 19%, and we anticipate additional rate increases in the near future in California. In lines other than workers’ comp, rates increased by 1%.

We continue to look at acquisitions that will complement our business, but so far we have not found any that meet both our strategic and valuation objective.

Based on our third quarter results, our expectations for the fourth quarter and considering the impact of our share repurchase plan, we are increasing our full-year 2010 guidance. We have increased the range for expected net operating income from $56 million to $57.5 million or $1.03 to $1.05 per share. We expect full year combined ratio will be between 94.5 and 95.5.

Looking ahead to next year, we believe that 2011 will prove to be another strong year for the company. We will continue to focus on price adequacy, disciplined underwriting, efficient client handling and geographic and product diversification. This strategy has proved us well despite a prolonged period of low-interest rate as well as the competitive pricing environment which we believe will continue into 2011. Because we operate in a dynamic and changing market, we are setting expectations for 2011 within a range of results.

We expect gross written premium to grow to be between $830 million and $850 million. The combined ratio should be in the 96% to 97% range, resulting in net operating income of $53 million to $58.5 million or a net operating income per share of $1 to $1.10 per share. As always, these goals include only those opportunities that we have identified for 2011 and do not contemplate any favorable or unfavorable prior year development.

In general, we are assuming a stable market for next year, not unlike the market we are currently operating in, to the extent the pricing environment improves or we find ourselves able to execute on new and identified opportunities, that may enhance our performance.

Thanks for your continued interest in Meadowbrook, and we will now open the call to questions. Operator?

Question-and-Answer Session

Operator

Thank you. We will now be conducting a question-and-answer session. (Operator instructions). One moment please, while we pool for questions. Our first question comes from Beth Malone with Wunderlich Securities. Please proceed with your question.

Beth Malone – Wunderlich Securities

Okay, thank you. Good morning, and congratulations on the quarter.

Bob Cubbin

Thank you.

Beth Malone – Wunderlich Securities

I have a question about, you know, the topline growth that you all have achieved. It’s really somewhat unique in the marketplace today for this whole year. Most other insurers are talking about declines, and that’s due to pricing pressures and competition. And you all seem to be bucking that trend. And I am just curious to know what – is it about your strategy? Or what are you offering these maybe program agents that they are not getting from whomever they are writing the business with today?

Bob Cubbin

Well, thanks for the question Beth. You know, we – the growth on a year-to-date basis is a little under 19%, and that’s almost exclusively from the two initiatives that we discussed in our – you know, Western workers’ comp and Midwestern workers’ comp. And so, you know, we do have a good, solid position to grow from. But basically that’s just rolling over the business that was previously written by another carrier, and really what caused that business to move to us was our ability to protect the franchise value of the program underwriter that we are working with. You know, we don’t appoint, you know, 50 agents in a given jurisdiction. We offer, obviously, competitive commission and appropriate pricing. And then I think the other thing that really differentiates us is our long (inaudible) commitment to this program business. So, you know, we are very well known for speaking with our partners and I think that makes the difference. Also, you know, the Internet initiatives and ease of doing business, both obviously are competitive, imperative in this (day and age).

Beth Malone – Wunderlich Securities

Okay, thank you.

Operator

Our next question comes from Ken Billingsley with BGB Securities. Please proceed with your question.

Ken Billingsley – BGB Securities

Good morning.

Bob Cubbin

Good morning Ken.

Ken Billingsley – BGB Securities

Congratulations again as well on the quarter. I have a couple of questions regarding your workers comp that you talked sort of initiatives in the Western and Midwestern states. I understand that you’re rolling over the business, so the impact maybe a little different. But the other information regarding the prior book and how much is actually rolling over from expectations and the reason I’m asking the question is that a broker announced that they were having some trouble with some renewal business as some businesses were shutting down or merging with other people.

Bob Cubbin

Yes, that’s a very good question. The rollover has been going very well and actually is slightly better than we anticipated. And I think largely that because the displacement in the market has been fairly dramatic. Almost everybody in California has, who had been writing the business for a number of years has increased rates. And the other thing Ken, as you know we kind of focus more on the small average premium side that in the rural and suburban areas. So it’s really more of an underserved segment of the market.

We’re dealing with small retail agents through our GA, who don’t have a lot of markets. So we’ve been very successful at rolling that business over because again there has been a long standing relationship with the general agents and they don’t have a lot of other markets. So we’ve been very successful of rolling that over.

Ken Billingsley – BGB Securities

Excellent. And two more questions on the workers comp side. What do you guys seeing from an exposure units? Have you started to flattening at least from an exposure standpoint, but there is not a decline or maybe an uptick?

Bob Cubbin

Yes that really varies by states. As you know some states have been harder hit by the unemployment, Nevada for example, that’s certainly down more than a lot of places, and in a number of other states we had started to see more of a flattening out. We haven’t seen an acceleration in the decline, if you will in payroll. So there is more stability there than there was there at this time of last year, but we haven’t really seen an uptick yet.

Ken Billingsley – BGB Securities

With no output [ph] but a better stability that much you had last year?

Bob Cubbin

Yes sir.

Ken Billingsley – BGB Securities

And the – on auto premiums are – has there been a change or shift in auto premiums?

Bob Cubbin

No, not really. We have heard from a lot of people that they’ve seen a lot of written premiums and our book – we really haven’t experienced that. Again I think because it tends to be the smaller average premium size, you don’t tend to see the same kind of fluctuation in the auto premiums that you do and it’s a very cyclical business like manufacturing or contracting which are not big parts of the business for us.

Ken Billingsley – BGB Securities

Okay, just two more questions. The reserve releases, can you say where those are coming from?

Bob Cubbin

Yes, pretty much across the board, we’re seeing benefits in the general liability, auto liability. The workers comp is probably not as much as it has been in the past. Accident years, the older accident years continue to perform very well. The 2008 accident year has turned out to be a very good year and we have seen reserve releases in the ‘08 year. Obviously, 2009 and 2010 are still little bit greener and so we really haven’t taken any actions there relative to reserve positions. But it hasn’t done any one side of the business – it’s been pretty much all of them.

Ken Billingsley – BGB Securities

That’s interesting because some of the peers out there have actually started reliving from ‘09 already.

Bob Cubbin

Yes.

Ken Billingsley – BGB Securities

Last question I have is on the – on your 2011 guidance. I know you said that you do not include reserve releases in that estimate with remaining share repurchase program plan that you have in place. Does your ‘011 estimate account for share buybacks through 2011 as well?

Bob Cubbin

No we did not include any estimates for that. We have about $2.5 million shares less than the authorization, and we did not pro forma that into next year, because we’re not certain what’s going to happen to our stock price which is an influence over whether or not we’re going to aggressively or maybe more conservatively repurchase shares.

Ken Billingsley – BGB Securities

Thank you. Thanks for taking my questions and congratulations on the quarter.

Bob Cubbin

Thanks Ken.

Operator

(Operator Instructions) Our next question comes from Scott Heleniak with RBC Capital Markets. Please proceed with your question.

Scott Heleniak – RBC Capital

Hi good morning.

Bob Cubbin

Good morning Scott.

Scott Heleniak – RBC Capital

First question I just had was, what is your outlook and expectation for new program business that you have sort of in the pipeline for 2011, I know you had lot of interactions over the past year, so but if you can give any kind of any update on as to what you might be rolling out next year?

Bob Cubbin

Yes, we do expect as I said premium growth to $830 million to $850 million for next year and that includes initiatives that we have identified and started this year that we then expect to see a full year up in 2011. The pipeline for new business is actually pretty good considering everything. But as has been our practice, we have to decline a lot of business because it isn’t adequately priced or it may not meet our expectations or our estimates of what the combined ratio needs to be to create the kind of profitability that we required.

But we have looked at a lot of things and there are a number of items that are in the pipeline that we would expect to start to execute on in 2011, but we don’t build those into the 2011 budget because they have not started to rollover yet or we haven’t entered into an agreement to roll it over. So the pipeline is still pretty good despite the soft markets. But again we’re being very cautious and careful about what we add.

Scott Heleniak – RBC Capital

Okay, and then coming along those lines, obviously your growth has been pretty strong. I was just wondering if I know you just put a comment on this but can you talk about where your customer renewal retention rates are – I would assume they have to be strong and probably improving, but can you give any detail on that?

Bob Cubbin

Yes, I mean in general the business that is not in the excess and surplus lines here the programs and the kind of traditional net operating [ph] business. The renewal retentions are quite high on an account-by-account basis. We haven’t seen a lot as I mentioned of deterioration in the exposure updates for most of our small business. And so that remains pretty strong and again, the distribution system that we utilized which it may not been exclusive with somebody but it certainly has some franchise value. We try to protect those relationships and align the financial districts of our partners with our own.

So that really does give us a much higher retention. But you have to really look at it, program-by-program, state-by-state because they do differ quite dramatically. But I would say in general, we’re very happy with our retention rates.

Scott Heleniak – RBC Capital

Okay and then just to clarify again on the guidance. You did say the $1.00 to $1.10 excludes reserve releases because I mean you guys have been running at four to five points a year, so you’re saying you can do $1.00 to $1.10 without that?

Bob Cubbin

Yes sir.

Scott Heleniak – RBC Capital

This is pretty big improvement. Okay.

Bob Cubbin

We’re on track to deliver that.

Scott Heleniak – RBC Capital

Okay, and just one last question. Just on the since you guys have bought ProCentury couple of years ago, I know ProCentury is pretty slow in premium accounts. Can you talk about where your premium size is now, average premium account size versus where it was a couple of years ago, have you seen much of a change?

Bob Cubbin

Well actually we have written more in our excess range which tend to be larger accounts, with large retentions. So if you exclude that we really haven’t seen a major shift in that. A lot of the E&S business is small, average premium size that’s definitely true. So if you look at our overall profile, it’s probably excluding excess lines, I would say it’s probably down a little bit but not a lot.

And again it does vary by program and by states. But if you look at kind of the more generic business if you will, it’s probably between $3,500 and $5,500 average premiums for the most part.

Scott Heleniak – RBC Capital

All right, thanks a lot.

Bob Cubbin

Thank you Scott.

Operator

Our next question comes from Tom Spiro [ph] with Spiro Capital Management. Please proceed with your question.

Tom Spiro – Spiro Capital Management

Good morning.

Bob Cubbin

Good morning Tom.

Tom Spiro – Spiro Capital Management

Bob and Karen, the question one, what interest rate are we earning on our new investments?

Karen Spaun

It’s about 3.5%.

Tom Spiro – Spiro Capital Management

And what do we got?

Karen Spaun

Primarily corporate – investment grade corporate.

Tom Spiro – Spiro Capital Management

You think you’re going to keep the duration of the portfolio about where it is?

Karen Spaun

Yes, about where it is. I mean it may go up a little bit, but really hovering around between 4.5 years and 5 years.

Tom Spiro – Spiro Capital Management

When you – we’re thinking about 2011, did you assume the interest rate environment of today is sustained for the 2011?

Karen Spaun

Yes. So new investments would be at the new investment, reinvestment rate.

Tom Spiro – Spiro Capital Management

Okay.

Karen Spaun

The new tax is invested less, so the actual overall yield will come down in 2011.

Tom Spiro – Spiro Capital Management

Hi Bob, how does the reinsurance markets look compared to the primary markets?

Bob Cubbin

I think they’re actually probably for the most part more stable than the primary market. Pricing environment for reinsurance I think has remained fairly flat and I think that is for good reason, because the prices are at a relatively low level. But results has been very good, so obviously reinsurers who want to protect their relationships are competitive with their renewals, I don’t know how much new business they’re writing, but certainly on the renewals they’ve been without partners.

Tom Spiro – Spiro Capital Management

Do you see more opportunities to acquire some more fee-based business?

Bob Cubbin

We do look at acquisitions as I mentioned, but so far we haven’t been able to execute on any of that net our overall financial objectives. It’s still a I think a difficult market for M&A, although it does seems to be picking up more. I think sellers are maybe more realistic on their pricing expectations, which should help facilitate more transaction.

Now the fee – the fee business is up. And so I think most people that are in the fee business, if they’re going to – if they’re able to survive through the next couple of years and hopefully see a change in the market, they would expect to see margins improve.

So I think sellers are trying to hold on for a better market multiple and a better market condition to sell in. But we have looked at a few and we’ll continue to do that, and hopefully, we’ll find some of that that fits our culture and our financial expectations.

Tom Spiro – Spiro Capital Management

Well thanks a lot. Good luck.

Bob Cubbin

Thanks Tom.

Operator

(Operator Instructions). Our next question comes from Bijan Moazami with FBR Capital Markets. Please proceed with your question. Bijan, you line is live.

Bijan Moazami – FBR Capital Markets

Do you hear me?

Bob Cubbin

Now we can.

Bijan Moazami – FBR Capital Markets

Okay, perfect. There has been some court cases in California that has been weakening the 2004 reforms in California. I know that these two new programs that you have is relatively new, but have you seen any kind of pickup in losses compared to the data that you have from previous years?

Bob Cubbin

Well, that’s a very good question. As we entered the California market, we had already considered those changes, and embedded those in our expectations. And so that really forms part of the basis for the rates increases that have been taken there. So in general I would say that frequency is meeting our expectations as a result of having or seen those impacts.

Bijan Moazami – FBR Capital Markets

And in terms of reserve releases that you have, which is mostly workers’ comp and one particular accident years they were coming from?

Bob Cubbin

Workers’ comp has really not been the driver off late of our reserve releases, it’s been more in the general liability and auto liability, professional liability areas. And I would say more than half of that has come from the 2007 and prior accident years.

And then, addition – as I mentioned 2008, we had initially reserved that at about a 98 combined and that has come down from that, from that level over the last years. So 2009, we really haven’t seen a lot of sustainable evidence to support bringing that accident year down yet. But we’re mindful of that and looking carefully as we go forward.

Bijan Moazami – FBR Capital Markets

Okay. And then, finally, are you guys contemplating to change any of your reinsurance contracts, maybe increasing the retention or decreasing it as a matter of fact.

Bob Cubbin

No, we tried to maintain stability in our reinsurance relationships. They really provide us the capital that we need to write the limits that we have to write and to protect the volatility in excess losses. So we tried very hard to create and maintain long-term relationships with our reinsurers for all the very business reasons.

In terms of retention, after we merged with Century and combined the balance sheets, we did adjust a few of our retentions upwards to reflect our larger capital base. But in general we’re comfortable with where we’re at on reinsurance.

Bijan Moazami – FBR Capital Markets

Thank you.

Operator

There are no further questions in queue at this time. I would like to turn the call back over to management for closing comments.

Bob Cubbin

Okay, thank you very much. Karen and I will be here if anybody has any further questions, and we look forward to seeing you all soon. Thank you.

Operator

This concludes today’s teleconference. You may disconnect your lines at this time. Thank you for your participation.

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!

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!

This Transcript
All Transcripts