Teekay LNG Partners LP.'s (TGP) CEO Peter Evensen on Q2 2014 Results - Earnings Call Transcript

Aug. 8.14 | About: Teekay LNG (TGP)

Teekay LNG Partners LP. (NYSE:TGP)

Q2 2014 Earnings Call

August 08, 2014 11:00 am ET

Executives

Peter Evensen - Chief Executive Officer of Teekay GP LLC, Chief Financial Officer of Teekay GP LLC, Principal Accounting Officer of Teekay GP LLC and Director of Teekay GP LLC

Analysts

Sameer Panjwani

Michael Webber - Wells Fargo Securities, LLC, Research Division

Fotis Giannakoulis - Morgan Stanley, Research Division

Operator

Welcome to Teekay LNG Partners Second Quarter 2014 Earnings Results Conference Call. [Operator Instructions] As a reminder, this call is being recorded. Now for opening remarks and introductions, I would like to turn the call over to Mr. Peter Evensen, Teekay LNG Partners Chief Executive Officer. Please go ahead, Mr. Evensen.

Unknown Executive

Before Mr. Evensen begins, I'd like to direct all participants to our website at www.teekaylng.com, where you'll find a copy of the second quarter 2014 earnings presentation. Mr. Evensen will review this presentation during today's conference call.

Please allow me to remind you that our discussion today contains forward-looking statements. Actual results may differ materially from results projected by those forward-looking statements. Additional information concerning factors that could cause actual results to materially differ from those in the forward-looking statements is contained in the second quarter 2014 earnings release and earnings presentation available on our website.

I'll now turn the call over to Mr. Evensen to begin.

Peter Evensen

Good morning, everyone, and thank you for joining us on our Second Quarter Investor Conference call. I'm joined today by Teekay Corporation CFO, Vince Lok; Chief Strategy Officer, Kenneth Hvid; and MLP Controller, David Wong.

During our call today, I'll be walking through the earnings presentation, which can be found on our website.

Turning to Slide #3 of the presentation, I'll review some recent highlights. For the second quarter of 2014, the partnership generated distributable cash flow of $61.5 million, up 11% from the same quarter of the prior year. The year-over-year increase is mainly due to the acquisition and fixed rate charter back of 2 LNG carriers from Awilco LNG in late 2013 and higher earnings from the partnership's Exmar LPG joint venture, partially offset by the sale of 2 2000-built conventional tankers in December 2013 and February 2014, respectively. For the second quarter of 2014, the partnership declared and paid a cash distribution of $0.6918 per unit, consistent with the prior quarter.

In June and July, the partnership finalized 2 significant transactions that will contribute to the partnership's future distributable cash flow growth. In early July, Teekay LNG, through our new 50-50 joint venture with China LNG Shipping, finalized agreements to provide 6 icebreaker LNG carriers for the Yamal LNG project. Through our new joint venture, Teekay LNG will invest just over $1 billion to construct these newbuilding LNG carriers.

Prior to this, in late June, the partnership acquired from BG Group ownership interests in 4 174,000-cubic meter LNG carrier newbuildings, which will each operate under long-term charters with BG.

Through this acquisition, Teekay LNG will invest approximately $250 million to construct these newbuilding LNG carriers.

Marking a milestone in the partnership's LPG fleet renewal and growth strategy, in April and June, Exmar LPG joint venture took delivery of the first 2 of 12 midsize LPG carrier newbuildings delivering into the fleet over the next 4 years. The joint venture also sold 2 of its older LPG carriers and recorded a $9.8 million gain on the sale based on Teekay LNG's 50% interest, which is not included in our distributable cash flow.

Turning to Slide #4, I'll take a moment to provide some details on the recent finalized agreement to provide 6 LNG carriers for the Yamal LNG project located in Northern Russia. The ownership of these newbuilding vessels will be through our new 50-50 joint venture between Teekay LNG Partners and China LNG shipping. The Yamal LNG project is an international joint venture, consisting of Novatek, Total and China National Petroleum Corporation.

The project, which is scheduled to start up in early 2018, will consist of 3 LNG trains capable of generating a combined 16.5 million metric tons of LNG per annum. LNG from the new liquefaction facilities will be transported primarily to Europe and Asia, and nearly all of the expected LNG production has already been agreed to be purchased by affiliates of the Yamal LNG project sponsors and other third parties. The project is expected to have a low break-even gas price, making it more competitive relative to other global liquefaction projects.

Our joint venture will provide 6 172,000-cubic meter ARC7 ice-class LNG carrier newbuildings, which will be constructed by Daewoo Shipbuilding in South Korea for a fully built-up cost of approximately $2.1 billion. Teekay LNG's 50% portion of this investment would be just over $1 billion. The vessels are scheduled to deliver between the first quarter of 2018 and the first quarter of 2020 and each will operate under charter contracts until December 31, 2045, not including extension options, following their respective deliveries.

The shipbuilding contracts included tail-heavy payment profile with a majority of the funds due upon delivery. The partnership has already funded its equity portion of the first installment payments of $95 million with proceeds from the recent $141 million equity offering, which we completed in July 2014. And the next shipyard installment payments won't occur until 2016 on the first newbuilding and later for the next newbuildings.

The Yamal LNG project will also require a number of conventional LNG carriers, which we will also have the opportunity to bid on later this year in a new tender.

Turning to Slide #5. I'll provide further details on our recent acquisition of ownership interests in the 4 LNG carrier newbuildings from BG Group.

Almost 2 years ago, our sponsor, Teekay Corporation, secured a contract with BG to provide construction supervision and technical management services for these 4 LNG carrier newbuildings. Subsequently, in late June 2014, the partnership agreed to acquire BG Group's ownership interest in these 4 newbuildings.

Through this transaction, Teekay LNG acquired 30% interest in the first 2 LNG carrier newbuildings and a 20% ownership interest in the second 2 LNG carrier newbuildings. The vessels will be constructed by Hudong Shipbuilding in China for an aggregate fully built-up cost of approximately $1 billion for which Teekay LNG's investment for its net 25% ownership interest is expected to total approximately $250 million. The vessels are scheduled to deliver between September 2017 and January 2019 and each will operate under 20-year contracts, not including extension options with BG.

With this acquisition and the Yamal LNG project, we have further broadened our diversified LNG customer base with 2 new and important customers in the LNG space. We're particularly pleased to leverage the Teekay Group's existing relationship with BG in the offshore business to now add BG as a strategic customer in our LNG business.

Finally, through both transactions, Teekay LNG has developed new strategic relationships with China-based partners, which has been a strategic focus for a number of years.

On Slide #6, we've updated our forward fixed-rate revenue projections to include our recent growth projects. This slide has been a hallmark of Teekay LNG since the partnership first went public in 2005 and I'm pleased to report that it keeps getting stronger.

Regardless of the type of vessel, all of our charter revenues are fee-based in nature and we have no commodity price or volume exposure.

As the table indicates, our LNG franchise is, by far, the greatest contributor to Teekay LNG's forward revenue portfolio with approximately $10.1 billion of forward revenues with an average remaining contact term of 14 years. This figure is expected to increase when we secure fixed-rate charters for our 3 currently uncommitted MEGI LNG newbuildings.

Our LPG carrier segment has also been growing, primarily through our investment in our 50% LPG joint venture with Exmar.

Lastly, our Conventional Tanker segment is expected to contribute an additional $300 million of fixed-rate revenues over the next several years, providing complementary fixed-rate cash flows in addition to our core gas suite. With approximately $11 billion of forward fixed-rate revenues, the partnership's existing portfolio of long-term fixed-rate contracts will provide our unitholders with a strong foundation of stable cash flows for many years to come.

Turning to Slide #7, I'll focus for a moment on our LPG business and how the partnership's Exmar LPG joint venture is looking to capitalize on the positive fundamentals in the LPG shipping market.

LPG shipping demand typically increases in the summer months when importers restock inventories in advance of the colder fall and winter months. However, LPG shipping rates are particularly strong right now relative to previous periods for all vessel segments of the market.

In addition to seasonal demand, the main factors for stronger rates in the second quarter were steady Middle East to Asia trade and increasing U.S. exports, driven by the arbitrage between U.S. and Asian LPG prices.

Driven by higher activity levels in the Atlantic Basin and supported by steady shipments to India, rates for medium-sized gas carriers, or MGCs, increased to an average of $890,000 per month or $29,300 per day in the second quarter, which are the highest average quarterly MGC rates since the first quarter of 2008.

Even with the recent increase, you can see from the graph at the top of the slide that MGC rates -- that we've experienced far less volatility compared to the Very Large Gas Carriers or VLGCs. This plays well to -- for Teekay LNG as it means our large fleet with jointly owned MGC should continue to deliver stable cash flows. VLGC spot rates were also at record-high levels in the second quarter of 2014 and have increased further in July partly as a result of the increasing LPG exports from the United States.

To capitalize on the future growth opportunity in the LPG trade, our joint venture with Exmar continues to grow and renew its fleet with modern times. During the second quarter, the Exmar LPG joint venture took delivery of 2 MGC newbuildings and also sold 2 older LPG carriers, realizing a capital gain of $19.5 million of which Teekay LNG's portion was $9.8 million.

Over the next 4 years, the Exmar LPG joint venture will add 10 more MGC newbuildings to its fleet.

Some of these vessels will replace older tonnage, which is consistent with the joint venture's strategy of continuing to provide it's customer base with a modern and competitive fleet.

Turning to Slide #8 now, I will discuss the LNG shipping demand, which is expected to benefit from the development of LNG export projects in the United States. As shown in the table at the top left, there are several U.S.-based projects which have already or are expected to achieve FID in the future. The projects shown in the table here have a combined export capacity of 78 million metric tons per annum, which, based on Clarksons' estimate of vessel requirements, will require over 80 LNG carriers based on the expected total export volume and distances. 2 projects have made a positive final investment decision, including the first 4 trains at Sabine Pass, which are already under construction, and the Cameron LNG project, which took FID earlier this week. All remaining projects are anticipating an FID decision later in 2014 or 2015.

In addition, the Freeport project has recently received its final approval from FERC. This demonstrates the ongoing progression of U.S. LNG export projects, which we believe will create significant demand for our current and future fleet of LNG carriers. In particular, our MEGI LNG newbuildings are especially attractive to U.S. LNG export projects, given their industry-leading fuel efficiency, large capacity and ability to transit the expanded Panama Canal.

We expect to take delivery of 2 of our MEGI newbuildings in 2016 and 3 more in 2017. Given our confidence in the MEGI design, we anticipate opportunities to add further MEGI vessels to support our fleet growth.

As a reminder, we continue to hold in the money options with DSME to order up to an additional 3 MEGI LNG vessels.

In addition to the U.S. projects shown here, we also see future demand for our vessels outside of the U.S. from export projects in Russia, Australia, Canada, and ultimately, East Africa.

On Slide #9, I'll review our consolidated results for the quarter compared to the adjusted income statements for the second quarter to the adjusted income statement for the first quarter, which excludes the items listed in Appendix A of our earnings release.

Starting at the top of the income statement. Net voyage revenues were comparable to the first quarter as a result of higher dry docking activity last quarter and one vessel being off-hire in the first quarter for repairs, partially offset by the sale of the Algeciras Spirit Suezmax tanker in February and lower revenues earned on the Hamilton and Bermuda Spirit as a result of lower second quarter Suezmax spot tanker rates.

Looking ahead to the third quarter, we're expecting a total of 43 off-hire days for the scheduled dry docking of 1 Suezmax tanker and 1 LNG carrier.

Vessel operating expenses were consistent with the prior quarter.

Depreciation expense decreased by $600,000, primarily due to the sale of the Suezmax tanker in February 2014.

In Q3, the Huelva Spirit Suezmax tanker is expected to be sold during August.

General and administrative expenses were consistent with the prior quarter.

Equity income increased by $1.7 million, primarily due to higher VLGC rates earned by the Exmar LPG joint venture in the second quarter, partially offset by scheduled dry dockings in the Malt LNG joint venture, also in the second quarter.

Net interest expense increased by $900,000, which was primarily related to a new debt facility related to the acquisition of the second Awilco LNG carrier.

Other income and income tax expense was consistent with the prior quarter.

I won't walk through all of Slide #10, which was included in our recent earnings release, however, I will note a coverage ratio of 1.0x for the second quarter. This decrease from the first quarter coverage of 1.02x is primarily due to an increase in our aggregate quarterly distributions as a result of the issuance of approximately 3.1 million common units from the July 2014 public offering. Excluding the impact of the new units, the coverage ratio would have increased to 1.04x.

On Slide #10 (sic) [ #11 ], we've provided an updated snapshot of the partnership's growth pipeline of over $2.5 billion, which now includes the interest in the 6 icebreaker LNG newbuildings for Yamal and the 4 LNG carrier newbuildings under long-term charters to BG. These projects further complement our existing pipeline of growth projects, which are scheduled to deliver between 2014 and 2018.

In addition to future potential projects, which may result from exercising the remaining 3 options on our MEGIs and bids for new LNG and FSRU contracts. Based on the strong long-term fundamentals in LNG and LPG shipping, we believe that our newbuilding order book shown on this slide will provide an attractive pipeline of distributable cash flow growth over the next several years.

Before I open up call to questions, I'd like to turn your attention to Slide #11 (sic) [ #12 ] where we have provided some details on Teekay Group's 2014 Investor Day, which is scheduled for the morning of Tuesday, September 30. The event will take place at the St. Regis Hotel in New York where we will provide a detailed presentation for Teekay LNG, covering our strategy, financial position and market outlook. The event will be webcast live for all interested investors. We encourage everyone to mark this date in their calendars, and we look forward to presenting and meeting with all current and prospective investors at that time.

Operator, I'm now available to take question.

Question-and-Answer Session

Operator

[Operator Instructions] And our first question comes from Sameer Panjwani of Raymond James.

Sameer Panjwani

So I think you mentioned this a little earlier in your presentation about the arbitrage opportunity for LPG between the U.S. Gulf Coast, Northwest Europe and even Southeast Asia. So I'm kind of wondering what's your capacity to add additional LPG vessels, and specifically, ethane carriers given the potential export capacity coming online in the U.S. Gulf Coast?

Peter Evensen

Right. So we have 2 -- so we're talking about 2 different exports. We're talking about exports of propane and we're talking about exports of ethane. The conventional LPG carriers, including ours, cannot take ethane. That would be taken in smaller ships, which are traditionally ethylene carriers, but they aren't the right size for these longer-haul distances. So there's going to have to be a new class of ships built for ethane projects. And some, for example, Reliance ordered 6 for their own account just a few weeks ago from Samsung. We're competing on several tenders, but we haven't been successful, and we're competing through our Exmar LPG joint venture. And we expect the low prices of exports relative to what you have in Europe and Asia to continue to increase those exports and that is a great feedstock for petrochemical plants. And so it will probably steal market share from that some.

Sameer Panjwani

Okay, great. So could you provide any guidance on maybe how long it would take to build these vessels for ethane, specifically?

Peter Evensen

It'll take about 2 years.

Sameer Panjwani

Okay. And then kind of turning to the Exmar JV, you mentioned that it sold a few vessels during the quarter and kind of, given your comments on the strategy to maintain an updated fleet, are there any more vessels that the Exmar JV can sell, at the same time while receiving the vessels that are already in the pipeline for it?

Peter Evensen

Yes, we have a plan to sell our older ships and we're realizing good values on those with the increase in rates, given the fact that we ordered about 2 years ago at that time, lower rates. So all of our newbuildings are in the money and we're doing very well by selling our older ships. Even though they're making good money right now, you have to sell into the strength, as we like to say. So that's why we're recording gains and we anticipate selling a few more ships over the next couple of years.

Sameer Panjwani

Okay, great. And then turning to the LNG side, do you think there's any variation between the timing and magnitude of liquefaction capacity coming online and the timing of LNG vessel additions based on recent FSRU announcements by competitors?

Peter Evensen

Well, in general, I would say the answer is yes. But for Teekay LNG, we're sold out on all of our ships until 2017, on our newbuildings, so we've already fixed our 2016. So I think that's more of a situation for competitors. For example, of the 117 vessels that are on order, about 30 of them don't have contracts. And so that's something that people are having a problem with in '14 and '15 and '16. What we anticipate is that when the export projects come on, it'll soak up that capacity. But until that time, we anticipate low charter rates. The same thing is true on the FSRU side. A lot of people have ordered FSRUs without contracts and so that puts them in a difficult position. We're -- the way we're looking at FSRUs is we're working it on a build-to-suit basis. In other words, we will only order an FSRU with the additional equipment if we have a contract.

Operator

We will move to our next question from Michael Webber of Wells Fargo.

Michael Webber - Wells Fargo Securities, LLC, Research Division

Peter, wanted to touch briefly on your MOL and I'm sure this is something -- a question you guys have prepped for, but can you help us think about your involvement within this projects and the kind of evolving geopolitical risk associated with Russia right now? And maybe you can kind of lay out the capital outlays for those assets. I know they're not going into service for several years, but just how we should think about that capital outlay and then how would you think about the geopolitical risk associated with that project?

Peter Evensen

Yes. Well, first of all, there is a risk with it, obviously. We have the situation in which the sanctions that have been put against Russia are only oil -- on the oil side. Gas was specifically excluded. And in addition, the equipment for the project has already been ordered. And so what we have observed is that the sanctions are on equipment, as well as projects going forward, rather than projects that are already, if you will, in the are hopper or taking place. I think the biggest risk is the financing of the project -- of both the project, and for us, our ability to finance the vessels. For us, as I said in my comments, we've already raised the money for the initial installment. We don't have any more money that is due until 2016, 2017 and I think we'll get a better idea of the timeline of the project at that time. So the biggest question for us is, can the project come up with the financing? And what we have seen and I was around -- and we've been around talking to the banks is between Russia, Chinese and Korean financing institutions, they have already secured the, I would say, probably the bulk of the financing that's available. So the western banks, which I would say are hesitant to lend to anything that has -- that extends to Russia, there isn't very much reliance on them. But that's something that we'll see over the next few months. The other thing that we like about our 6 ships is they're coming later in the project rather than earlier in the project. And so we aren't -- if the project is delayed by a year, it doesn't have a huge effect upon our 6 newbuildings.

Michael Webber - Wells Fargo Securities, LLC, Research Division

Sure. And I guess, when we think about that entire project you guys and MOL [indiscernible] participating in the riskier end of that project with those icebreaking assets and there's [indiscernible]?

Peter Evensen

Well, the project is going ahead. First of all, the sponsors have already spent $5 billion. So the project is going ahead and we really like the project because, when it comes onstream, it'll be low-priced gas and they need the vessels. So the vessels are absolutely critical to the whole project. And so -- and what they liked about Teekay was our ability to train up crews and operate in the ice conditions that you have several months of the year there. So we're confident that the -- that this is the beginning of Yamal and it isn't just the first 3 LNG trains. And it's also critical that we've seen, for example, government-to-government agreements between Russia and China as it relates to this project. So it's part of a bigger geopolitical question, but you have to look at it, not just from a U.S. point of view, you have to look at it from a European point of view and you also have to look at from an Asian point of view. And from an Asian point of view, in particular, they want this gas. And so that's what I saw having been -- having worked on this project for over 2 years, that there's a real keen sense in Asia that -- and especially in China, that they want to diversify their source of gas. And that's why you're finding Korean, Japanese, Chinese interests teaming together with Russian interests and now with Teekay in order to make this project happen.

Operator

And we'll move to our next question from Fotis Giannakoulis of Morgan Stanley.

Fotis Giannakoulis - Morgan Stanley, Research Division

Peter, you mentioned, I think, earlier that you have contracted all your capacity, your LNG capacity, for 2016. I thought that you had a couple of Maersk vessels that they were coming off in 2015 and '16. I'm talking about the Methane Spirit and the Magellan Spirit. Have you found a new contract for these vessels?

Peter Evensen

Sorry, I added the word newbuildings. Our newbuildings that are coming in 2016 have been contracted. You are right. We are sold out right now, but we have one contract, one LNG contract, of which we have 50% that's rolling in 2015. And we have another contract in 2016 of which we have 50% rolling. So you can say we have one open vessel between 2015 and 2016.

Fotis Giannakoulis - Morgan Stanley, Research Division

Can you give us an update of how the discussions are going, if there is any interest right now for chartering these vessels and how is the situation in the LNG chartering market? And when do you expect this situation to change towards the better?

Peter Evensen

Well, we are out having discussions with charters about short-term charters. We're also trying to team those charters together with some of our MEGI projects and putting them together. But I have to be honest with you that short-term rates have been declining for 2 years and they're at or near $60,000 a day. And with the level of uncommitted ships coming in, we think the best case is that you'll get about $60,000 a day for them and that's really because there isn't a lot of new gas coming on, certainly not this year and you've had a few setbacks like Angola. And until we start to see much more gas coming up that soaks up the capacity, I don't think you'll see a turnaround in the charter rates. But that's all right because given the price that we bought our Maersk -- the vessels from Maersk, we're comfortable having -- being able to charter them at around $60,000 a day.

Fotis Giannakoulis - Morgan Stanley, Research Division

And I see that you have 3 more undeclared options for your MEGI newbuildings. Can you tell us when these options expire and if you are considering exercising these options as we move closer to the delivery of the first couple of vessels.

Peter Evensen

Yes, so we have steadily extended those options. I was just out in Korea a month ago and so we're working to extend those options so we can continue the discussions we have with charters on taking delivery of them with contracts. We know that they are at a preferential rate, but our partnership generally likes not to have too many uncommitted vessels. So hopefully, we'll find employment for them in the next few months and then we can declare those options. But right now, we have 3 open ones and we don't want to have too many open ships, although the delivery window at which we would get them, 2017, 2018, is very favorable. But that's something that we're -- so we're extending the date by which we have to declare those options.

Fotis Giannakoulis - Morgan Stanley, Research Division

Okay. Can you give us some guidance about the expenses of the Yamal vessels? I understand that the returns will be very similar to all these long-term deals, but in order to model it, given the fact that these are special vessels, at what levels will the expense going to be?

Peter Evensen

We'll be giving more detail on Yamal economics at our Investor Day, but the returns are better than what you see in the conventional market.

Fotis Giannakoulis - Morgan Stanley, Research Division

Okay, that's very helpful. And one last question about the LPG market. The market we see is booming at this point, especially for the larger vessels. Shall we expect any considerable difference in the LPG revenue both on absolute basis, but also on a daily basis from the LPG fleet?

Peter Evensen

Well, we've been recording much better, certainly, than our acquisition model. And as I said in my prepared remarks, we're very happy with that. But we're also cognizant of the fact that a lot of VLGCs have been ordered, so we're looking to sell some of our older tonnage into that strength, given how many VLGCs have been ordered. People are really bullish on it, and of course, when the rates are as high as they are at present, but when you're not getting your ship till 2016, 2017, it could be a different market. So really, what we see is the LPG market is the mere opposite of LNG's. In LPG's, we see very strong short-term markets, but ultimately we think those markets come down, given that the order book is 50% in a lot of classes, whereas, on the LNG side, we see short-term weakness, but long-term strength, as we see a lot more demand coming on in the LNG side in 2017 and beyond.

Fotis Giannakoulis - Morgan Stanley, Research Division

So -- and about the near term, the next couple of quarters, shall we expect any significant change in the income from the partnerships from the equity-accounted vessels, given this strength of the LPG market?

Peter Evensen

Yes, well -- I think we'll continue to get strength. We're working on fixing some of our newbuildings that are coming. And I'm hopeful that we'll announce more term contracts there. And you'll probably see us sell a couple of older ships as well. So net-net, we ordered our newbuildings at a really favorable time, so they're very profitable. And we're selling our older, depreciated ships and racking up nice gains.

Operator

There are no further questions at this time. Please continue.

Peter Evensen

All right. Thank you, all, very much, and we look forward to you tuning in for Investor Day.

Operator

Thank you. Ladies and gentlemen, this does conclude your conference call for today. We thank you for your participation. You may now disconnect your lines, and have a great day.

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!