The Phoenix Companies' CEO Discusses Q1 2011 Results - Earnings Call Transcript

| About: The Phoenix (PNX)

The Phoenix Companies, Inc. (NYSE:PNX)

Q1 2011 Earnings Call

May 5, 2011 01:00 PM ET

Executives

Naomi Kleinman – Head, IR

James Wehr – President and CEO

Peter Hofmann – SVP and CFO

Christopher Wilkos – EVP and Chief Investment Officer

Edward Cassidy – EVP, Distribution

Analysts

Steven Schwartz – Raymond James

Operator

Welcome to The Phoenix First Quarter 2011 Earnings Conference Call. Thank you for standing by. All participants will be in a listen-only mode until the question-and-answer session. (Operator Instructions). Today’s call is being recorded. If you have any objections, you may disconnect at this time.

I will now turn the call over to the Head of Phoenix Investor Relations, Naomi Kleinman. You may begin.

Naomi Kleinman

Thank you. Good afternoon, and thank you for joining us. I’m going to start with the required disclosures and then turn it over to Jim Wehr, our President and CEO for an overview of the quarter.

With us today are Peter Hofmann, Chief Financial Officer; Chris Wilkos, Chief Investment Officer; Ed Cassidy EVP for Distribution, Phil Polkinghorn, Senior EVP for Business Development and Mike Hanrahan, Chief Accounting Officer. Our first quarter earnings release, our quarterly financial supplement, and the first quarter earnings review presentation are available on our website at phoenixwm.com.

Slide two of the presentation contains the important disclosures. We may make forward-looking statements on this call that are subject to certain risks and uncertainties. These risks and uncertainties are discussed in detail in our first quarter earnings release and our latest SEC filings. Our actual results may differ materially from such forward-looking statements.

In addition to Generally Accepted Accounting Principles, we use non-GAAP financial measures to evaluate our financial results. Reconciliations of these non-GAAP financial measures to the applicable GAAP measures are included in our press release and financial supplements.

Now, I’ll turn the call over to Jim.

James Wehr

Thanks, Naomi, and good afternoon to everyone. Today we are adding to our usual conference call line-up in order to provide some additional insight into Phoenix’s growth and distribution strategies. After Peter Hofmann takes you through the financial results and Chris Wilkos reviews our investment performance and strategy, Ed Cassidy, who heads up our distribution company, Saybrus Partners, to bringing up-to-date on annuity sales and Saybrus progress.

Phoenix continues to make steady progress on many fronts. We still have a lot of work to do but our improvement against the number of benchmarks including annuity sales growth, persistency, expense management and surplus growth is clear. Consistent with our recent trends and the strength of the financial markets we posted solid operating results offset by some volatility in our alternative investment income.

Net income was affected by declines in the value of hedges as the equity and credit markets improve. Overall, I would characterize the first quarter as another in a string of steady progress quarters. Annuity sales grew by $70 million from the fourth quarter to $205 million this quarter, driving positive annuity net flows for the second quarter in a row. We had further improvement in life persistency with our lowest surrender rates since the third quarter of 2008. Annuity persistency also remain stable contributing to the positive net flows.

Operating income improved modestly but we still have a lot of work to do to improve results meaningfully. This quarter’s results were tempered by lower returns from our alternative investment portfolio, which were down for a number of reasons that Chris will review. Aside from this anomaly, investment portfolio metrics continue to be favorable, with impairments of only $6 million, slightly higher unrealized gains and further reduction in our exposure to below investment grade bonds.

Expense management results across the board were solid. As you know, we took our aggressive action on expenses starting in 2009 and we are now realizing the results of those actions. We’ve downsized our infrastructure and we’re managing expenses on an ongoing basis much better. Although we anticipated Saybrus Partners would break even in the first quarter, we miss that goal by less than $1 million. This was a revenue shortfall versus our plan, but we’re confident we will make further progress in the coming quarters. You will hear more about Saybrus from Ed.

Our ongoing enterprise wide progress was validated earlier this spring, when S&P joined Moody’s and A.M. Best in revising their outlook on Phoenix to stable. S&P’s decision to assign a stable outlook was based on our improved capital position, stronger investment portfolio and lower surrenders. As you know, a stable outlook is the first step towards rating improvement and these rating actions make us a more attractive partner as we continue to pursue opportunities to accelerate growth.

Even with this progress, we will continue to experience headwinds from the low interest rate environment, the overall economy, which remains difficult and unpredictable. Our focus on the four strategic pillars, we established two years ago, continues to be the right path to navigate these challenges. Each color individually is fundamental to Phoenix’s health and future and taken together they are the foundation for growth. Let me explain.

Pillar one, balance sheet strength. Our progress here is demonstrated by improved asset quality and estimated RBC ratio of 308% and statutory surplus of nearly $800 million. Our second pillar is policyholder’s service, here we continue to succeed in improving our persistency rate, which is the ultimate measure of customer and producer satisfaction. Our progress on our third pillar, operational efficiencies was a clear contributor to earnings this quarter.

First-quarter core GAAP expenses before deferrals, were down 17% versus a year ago. Equally important to these number, is the cultural change that has occurred here at Phoenix. This change brings real discipline to how, when and where we deploy our resources. That ultimately, is the key to successful ongoing expense management and profitable growth, which brings to our fourth pillar, sustainable, profitable growth.

This is where our focus has sharpened in 2011 because our success with our first three pillars is enabling this growth.

We’ve already seen some demonstration of that. Two years ago, we set out to find ways, we could leverage our existing core skills and bring them to markets where we can be successful. And now we’ve attracted a number of strong distribution partners in our growing annuity sales at a healthy pace.

Our distribution consulting business is well established and approaching breakeven. And we are finding more receptive years to additional market opportunities that will ultimately diversify and broaden our range of revenue sources.

Before I turn it over to my colleagues, let me make sure to be clear about a few points. First, no one at Phoenix is running the victory flag up to flagpole. We know we still have a lot more work to do. But second, there is clear evidence on many fronts that our strategy is producing the results we have been striving for over the last two years. Third and finally, we are optimistic and enthusiastic about the future for Phoenix and remain committed to its success.

With that, let me ask Peter to take you through more detail on our results. Peter?

Peter Hofmann

Thanks, Jim. As Jim indicated, the things this quarter continue to generally reflect our progress managing the in force balance sheet and expenses of the company. At the same time some of our growth initiatives were not yet contributing to earnings or gaining further traction.

Highlights for the quarter are shown on slide three. GAAP operating earnings were 10.4 million or $0.09 per share excluding tax benefit. Insurance fundamentals in the quarter were good. Accounting margins were favorable and life persistency continue to improve.

On a sequential basis, we had lower net investment income. The fourth quarter had a combination of strong partnership results, prepayment premiums and mark-to-market changes, which did not repeat in the first quarter. The investment portfolios quality continues to improve with lower credit impairments at a lower percentage below investment credit funds.

On the statutory front, we continue to generate capital and reduce risk. Statutory surplus grew by $34 million to $797 million and our RBC ratio is estimated at 308% as of March 31. The statutory gain from operations for Phoenix Life was $29.6 million versus $4.3 million in the first quarter of 2010.

A more detailed earnings summary is shown on slide four. Open block revenues declined modestly from the fourth quarter driven primarily by lower net investment income. Benefits were higher than the fourth quarter and a year ago largely reflecting mortality reserve increases.

Operating expenses were $57.8 million, lower than last quarter and a year ago. The decrease from both periods was primarily due to lower compensation and employee related expenses. Also recall that there were unusual expenses relating to premium tax adjustments and severance in the first quarter of 2010. The regulatory closed block contributed $12.5 million, which is consistent with the glide path of the block established at the time of the demutualization and represents the expected quarterly level for the remainder of 2011.

Realized investment losses include a reduced level of credit impairments, modest derivative losses due to the rising equity market and an $8 million loss from the non-performance risk factor that is used to discount the GAAP liability, related to variable annuity living benefits. And economic basis, our variable annuity hedge program performed well in the quarter.

Slide five, highlights the trends in operating earnings and spiked out discreet items that affect operating income comparison. This quarter, we recorded a $4.4 million tax benefit. As we have indicated in prior calls, our operating earnings comparisons, we’re currently using a 0% effective tax rate. Packing out the tax benefit gives us an adjusted operating EPS of $0.09. Book value per share excluding AOCI is driven by $0.06 to $11.04 due to the GAAP net loss.

Net investment income which is shown on slide six, decrease sequentially by $31 million, there were several drivers of this decline, the most significant of which is reflected in other invested assets on this slide. Alternative asset returns particularly mezzanine funds were lower this quarter, following the fourth quarter would say a number of large realization events in this portfolio.

In addition, we had virtually no make whole premium income this quarter, again following meaning activity in the fourth quarter.

Finally, severance, since that exceed the (inaudible) investments for which we adopted fair value accounting had lower mark-to-market gains this quarter. Both (inaudible) and fair value option securities are reflected in a long-term debt category on the slide.

Turning to our insurance fundamentals, slide seven shows mortality cost ratios for the open and closed blocks. Open block experience particularly in universal life was favorable this quarter. After that offset the favorable open block mortality benefited pre-tax earnings by about $5 million.

Experience in the closed block was within our expectations for the quarter. As a reminder, because of the positive policyholder dividend obligation, gross block mortality Experience does not directly affect GAAP earnings.

Slide eight shows annualized aggregate life surrender rates based on contract value surrendered and our annuity net flow trend. Annualized life surrenders were at 7.2% and in the closed block, annualized surrenders were at 6.6%. Both numbers are at their lowest levels since the third quarter of 2008.

Note that these ratios do not include lapses in which policies expire with no value. As Jim mentioned earlier, annuity net flows are positive for the second quarter in the row. The improvement was driven by increased deposits primarily of fixed index annuities and stable surrender levels in the existing block of variable and fixed annuities.

We continue to focus on controlling expenses. Slide nine shows consolidated statutory and GAAP expenses adjusted for non-core items. The expense reductions we have taken over the last two years are clearly visible driven primarily by lower compensation-related costs. First quarter 2011 core statutory expenses were down 7% versus a year ago. And before deferrals, GAAP expenses were down 17%. Expenses over the remainder of the year, especially in the second half, are likely to be somewhat higher than the first quarter though not at the level of the fourth quarter both due to timing of some expenditures and due to some planned investments and operational efficiencies. We will provide greater detail on our second quarter call.

Let me spend a moment on our RBC ratio, which is shown on slide 10. As of March 31, total adjusted capital increased by 4% to $929 million. Risk based capital dropped 4% to $302 million, giving us an estimated RBC ratio of 308%. Core life insurance results were one of the key drivers of the improvement adding 13 percentage points.

Also contributing to the growth was a reduction in the percentage of below investment grade bonds as well as continued improvement in the markets, which lowered our market risk and improved RBC by 8 percentage points. We expect any additional improvements in the RBC ratio over the course of the year to be more modest.

Holding company liquidity was $50.7 million on cash and securities as of March 31. Recall that we have no debt maturities until 2032.

And with that, I’ll turn it over to Chris.

Christopher Wilkos

Thanks, Peter. The investment highlights for the quarter are summarized on slide 11. During the first quarter, the investment portfolio continued to experience the favorable trends that have been in place over the past year, including a sharp decrease in bond impairments, stronger credit quality, continued appreciation in portfolio values and a strong liquidity position.

Reflecting the favorable credit markets, bond impairments in the Phoenix portfolio declined to $5.7 million in the quarter, an improvement from the $10.8 million of impairments in the fourth quarter of 2010. This quarter’s impairments were at the lowest level since 2007. With stable credit markets, impairments have trended downward and should continue to be benign.

While treasury rates rose in the first quarter, credit spreads tightened and the Phoenix portfolio appreciated by nearly $50 million. The appreciation was consistent in all credit sectors. Portfolio quality also improved as the percentage of below investment grade bonds declined to 8.2% of total bonds from 8.7% in the fourth quarter due to sales of lower rated bonds and upgrades in credit quality.

We are in the middle of our stated policy range of 6% to 10% of the portfolio and below investment grade bonds and are comfortable with our credit profile. Liquidity also remained strong with a core position in short term securities and agency mortgage backed securities.

Peter has described the decrease in net investment income in the first quarter as largely resulting from reduced alternative asset performance. As we’ve described in the past, our alternative returns have historically been strong but can be lumpy or variable from quarter-to-quarter, depending on equity markets, realizations within specific funds, M&A activity and higher than normal investment income due to refinancings of mezzanine debt.

While our venture capital portfolio benefited from continued strong equity markets and produced steady returns, earnings in our mezzanine fund holdings swung to a slight loss after posting $9.9 million of income in the previous quarter. In the fourth quarter, improved credit markets and low interest rates were key factors driving refinancings in our mezz funds. And M&A activity led to several strong realizations of value. In contrast, in the first quarter we had very little activity.

Volatility in results is not unusual a reflective of any changes in the economic fundamentals in our funds and is compounded by the lack in partnership accounting. Returns do tend to smooth out over several quarters with a balance of about $180 million in mezz funds and a long-term return assumption of 12%. These funds should produce about $20 million per year in investment income.

Turning to slide 12, like all fixed income managers, we’ve been challenged by the low level of interest rates over the last few years. Available investment yields have declined especially given the spread tightening in credit sectors. In this environment, the search for yield has become critical. How does Phoenix changed its investments strategy to cope with lower yields? The answer is that we haven’t had to change our strategy at all.

Our strategy is designed to be flexible and responsive to changes in market conditions and portfolio objectives. We have used the multisector fixed income strategy successfully for many years, we emphasized diversification among all sectors of the bottom market.

Our strategy can identify opportunities as they shift the among sectors and we can take advantage by shifting our allocations. We diversify our credit exposure on a very granular basis, so as not that outsize the exposures and individual credit. We have a relative value orientation, which balances yield with total return potential.

And importantly, our disciplined asset liability management process keeps our interest rate exposure appropriate for our liabilities, no matter what the level of interest rates. Unquestionably it is more difficult to invest at lower rate levels, but we are remained true to our strategy, which will benefit our portfolio when rates moderate to higher levels.

As an example of our investing in a low rate environment, we have invested over $400 million in the last year to support our fixed index annuity product. As you heard from Jim, that product line has grown substantially over the last several quarters. We have invested across a number of bond market sectors, while keeping quality high and stressing diversification. Even so, we have been able to achieve favorable spreads and yields to support the product profitability.

Now I’ll turn the call over to Ed Cassidy, who will provide more detail on our annuity sales growth.

Edward Cassidy

Thank you, Chris. Today, my remarks on Saybrus Partners will cover three areas. First, I will give you a brief overview of Saybrus Partners model. Second, I will update you on Phoenix annuity and life sales. And finally, I will provide an update on our third party assisted sales business and results to date.

Let me begin with a brief background and description of Saybrus Partners. Please turn to slide 13. Saybrus was formed in the fourth quarter of 2009, leveraging Phoenix experienced wholesaling team to meet the changing needs of the marketplace. The unique Saybrus model has two distinct for complementary businesses as depicted on the slide. The diversity in our model is part of our core strategy to leverage our broad capabilities and flexibility to take advantage of opportunities as the markets presents them.

On the left, you’ll see that Saybrus provide wholesaling services in support of Phoenix life in the new annuity product portfolios. On the right is Saybrus assisted sales channel designed to help institutional partners serve their clients’ life insurance needs with third-party products.

Moving on to sales of Phoenix products, we saw a steady progress in annuities throughout 2010. Coming off of solid fourth quarter growth, sales increased further from $136 million to $205 million in the first quarter of this year. We can attribute these gains to a number of factors, primarily developing and executing our distribution strategy through independent marketing organizations, a compelling product offering from Phoenix and the formation of strategic distribution groups, including the AltiSure Group and Plan Right Partners. Together these advances have helped us reach sales heights that we believe can maintain a solid pipeline of annuity business and can continue to grow in the future.

Our primary distribution channel for Phoenix annuities is with independent marketing organizations or IMOs. Working with these firms offers us access and visibility with a very large producer audience who serve the middle market. With a heavy focus on recruiting producers, aggregating smaller firms and driving sales, the IMOs have a strong appetite for competitive products, exclusive distribution opportunities and sales and marketing support services.

In particular, Phoenix has delivered three suites of fixed index annuities targeted at the middle market to help the growing number of baby boomers facing serious concerns about being able to maintain their standard of living throughout retirement. These products all offer potential for asset growth, protection against market losses and flexibility to adjust for life changes. Phoenix has also developed very competitive optional riders for these index annuities that guarantee an income stream for life and each is designed to maximize the income according to whether the client plans to take income on day one or can wait a few years.

In addition, we relaunched Phoenix popular Plan Right Retire Right client program with a limited distribution group. The program includes formats for both group seminars and individual discussions between insurance professionals and their clients. We have seen strong sales growth through these partners and we continue to focus on this group to deliver a steady flow of business. With competitive products combined with strong sales support and diverse distribution, we are confident in the continued potential for Phoenix annuities.

For Phoenix life products, we still have a substantially reduced level of sales as we are continuing the process of rebuilding the product portfolio. As we look to the future, we plan to work with the IMOs to develop life products specifically suited for the middle market with the goal of bringing some of these products to market toward the end of the year. We have driven scale on Phoenix’s annuity business over for the past year and we’re looking to leverage that success with Phoenix life sales opportunities in the coming year.

Now, let me turn to third-party distribution business, where we deliver assisted sales support for select institutional partners. As you might recall, we created this business to use the assisted sales talent and expertise we had from our years working with state formed agents and their customers. Working with institutional firms, we provide life insurance consultation to help financial advisers enhance their value to their clients. We are pleased to represent top carriers such as John Hancock, Specific Light and other select companies. This multi carrier offering allows us to be product neutral as we help the adviser to find the right solution for client’s needs. Then identifying the appropriate type of product for that solution.

Our value proposition for this business centers on providing dedicated and knowledgeable local support taking a solution based approach and helping financial professionals to a proven process for building a successful life insurance business. We are continuing to build momentum in our third party business, as the relationships we’ve formed with financial advisers are bearing fruit and growing. In Edward Jones, where we are hearing our fifth quarter of business, we are seeing great momentum. We are the exclusive life distributor for John Hancock in specific life within Edward Jones.

Coming of a very strong fourth quarter in 2010, sales were up another 17% in the first quarter. We’ve just concluded our third quarter with Wells Fargo advisers, where we also seeing strong activity. In the first quarter, application counts were up 54% over the fourth quarter of 2010 and sales were on a strong trajectory, consistent with what would have expected this point in time from a new business.

We believe this metric signals that we have established relationships with financial advisers. And we expect to broad and deep in those relationships in 2011. We have good momentum in both Edward Jones and Wells Fargo and continue to execute our strategy to build a very successful business in these channels. We are paying close attention to our partner firms and their advisers to learn how we can best meet their needs and continued distinguishing ourselves from the competition.

In closing, we’re very pleased with Saybrus progress today. In just five quarters, we’ve established a solid foundation for our business and made significant progress towards our goals. While we fell short of our aim to break even in the first quarter of this year, our loss was less than $1 million EBITDA and we look forward to further improvement in the second quarter.

With that, I’ll turn it back to Jim.

James Wehr

Thanks, Ed. Hopefully, you’ve found today’s presentations helpful – particularly adds update on Saybrus. It should be clear that continued progress on our first three pillars has positioned us to focus more intently on profitable growth in 2011.

Now, we’ll open up the lines for questions.

Question-and-Answer Session

Operator

Thank you, sir. (Operator Instructions) Our first question comes from Steven Schwartz from Raymond James. Your line is open.

Steven Schwartz – Raymond James

Hey, good afternoon, everybody. Thank you. I have a few. First, I want to follow up on Saybrus, obviously, it sounded like your first quarter was great from the numbers that you were talking about and how you’re with Edward Jones and Wells Fargo. Yet in the release you state that it was – the reason for the slight shortfall from breakeven was lower than expected third-party revenue. I would take away from that you thought there was going to be a third company that you were going to be with. Is that accurate?

James Wehr

I’d ask Ed to respond to that. One of the reasons why we are focusing on Saybrus on this call is to give all of you folks an opportunity to drill into the Saybrus model and understand it a little better. So I’m going to let Ed ill respond to that.

Edward Cassidy

Sure. Thanks, Jim. Steven, the shortfall was not attributable to not having a third partner in the model. I think if you can appreciate with a start-up, forecasting is tricky. We’re trying to be as cautious as possible when setting expectations, but basically our shortfall was really attributable to a couple of factors in our assisted sales business. And as you mentioned, our business is up significantly quarter-over-quarter, but it is still relatively new. We had a little bit of seasonality affect our plan with regards to our newness.

It was a little greater than anticipated. And I guess lastly our submitted premium in both accounts have been – has been very strong. However, we saw lower paid premium than expected and we attribute this to both us and our product partners being relatively new in the system. So we’re adapting to our newness and we expect improvement in this area as we gain more experience in the system – we have that improvement already targeted in the second quarter.

Steven Schwartz – Raymond James

That second part is interesting, given your experience in the past, is the difference or the – did not paid, that much difference when it’s been in the past? I’m not asking this correctly, but obviously, that surprised you I guess. I guess if you got an idea why?

Edward Cassidy

Yeah, I – first of all, your question is very fair, Steven, is that, as we saw our businesses as an example in the past was state form, we do notice some differences in our business with Edward Jones and Wells Fargo. From an assistant sales prospective, I think, we could acknowledge the fact that all these institutional opportunities are a bit different. And as we sort of rub of that newness that I spoke to, we do see now more of a correlation between the types of institutional business we had in the past in this one, it’s just taken us some time in the start-up phase to get to where we started to where we are now.

Steven Schwartz – Raymond James

Okay. All right. That’s fair. If I may, I will move on. You said the – I forget which one it is – you had a $180 million in what case was that? Excuse me, I’m sorry. It was of $180 million in basically the other invested assets? Do you know how much AUM would be? Or how much caring in debenture capital?

Edward Cassidy

Yeah, bear with us for one second, Steven.

Steven Schwartz – Raymond James

Okay.

Edward Cassidy

We’ve got achieved investment officer and a CFO and achieved Chief Accounting Officer trying to get that response for you.

Steven Schwartz – Raymond James

Well, let’s give the CFO a break, I’ll ask him a question?

Edward Cassidy

Yeah, I think, he’s going to respond.

Steven Schwartz – Raymond James

Okay.

Christopher Wilkos

Steven, it’s Chris. The amount in debenture capital is about $225 million in AUM.

Steven Schwartz – Raymond James

So we’ve got $225 million in the VC, we’ve got a $180 million in the mezzanine funds JV’s and other alternative stuff. Is that correct?

Christopher Wilkos

That’s correct. There is an addition to those two categories, there are some other types of partnership assets that are not in those numbers.

Steven Schwartz – Raymond James

Okay.

Christopher Wilkos

If you look on page 9, of our investment supplement that describes the types of alternative assets that we have, they are listed by type, private equity mezzanine et cetera.

Steven Schwartz – Raymond James

Okay.

Edward Cassidy

– and they are sized.

Christopher Wilkos

They are sized. And that’s in our current first-quarter investor supplement.

Steven Schwartz – Raymond James

That’s on page 9?

Christopher Wilkos

Page 9.

Steven Schwartz – Raymond James

All right. (inaudible) page 9. But I assume it’s here somewhere?

Christopher Wilkos

It’s the detailed investment portfolio supplement that’s on the website.

Steven Schwartz – Raymond James

Oh, okay. All right. Okay, I’ll go get that. Okay, great. And then one more for you, Peter? Just as something, I think we are going to have to think about, as index annuities become a bigger part of your company?

Christopher Wilkos

Yeah.

Steven Schwartz – Raymond James

And that’s the accounting form, there the accounting is pretty funky. And I’m wondering how you’re going to deal with is that all the mismatch, the GAAP requires between the actual value of the index is going up?

Christopher Wilkos

Yeah.

Steven Schwartz – Raymond James

And what I guess is call the host, the 10 years that you have to assume that the – that you’re paying for the auctions?

Christopher Wilkos

That’s right. That’s – it’s not a material item as yet for us but it’s going to be within a quarter or two. So first of all, we are open to suggestions from the investment community in terms of (inaudible)

Steven Schwartz – Raymond James

Okay.

Christopher Wilkos

I’ll see you to understand it. But...

Edward Cassidy

What we will start to do is, give you clarity around what the realized gain component relative to the auctions is, so that you can see that we’ve not taken the additional effort China determined whether we should be amortizing a piece of that cost into earnings in some form. Currently the bias is just to provide transparency around the components.

Steven Schwartz – Raymond James

Okay. I’ll bug Naomi about it later in the quarter. All right, that’s what I have. Thank you, guys.

Edward Cassidy

All right, Steven. Thank you.

Operator

(Operator Instructions) At this time, I show no further questions gentlemen.

Edward Cassidy

Well, thanks, again to everyone for their time and attention today. We do appreciate that everyone is extremely busy and you’ve been on several calls prior to ours. So let you get back to work processing that information alongside ours. And we look forward to keeping you posted on further progress. Thank you.

Operator

At this time that will conclude today’s conference. You may disconnect. And thank you, for your attendance.

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