TheStreet, Inc. (NASDAQ:TST)
Q2 2016 Earnings Conference Call
August 1, 2016, 16:30 ET
Eric Lundberg - CFO
Larry Kramer - Chairman
David Callaway - President & CEO
Kara Anderson - B. Riley & Co.
William Gibson - ROTH Capital Partners
Welcome to TheStreet's Second Quarter 2016 Financial Results Conference Call. The date of this call is August 1, 2016. This call is being webcast live on the investor relations section of TheStreet's website at www.TheStreet.com. This call is the property of TheStreet and any recording, reproduction or transmission of this call without the expressed written consent of TheStreet is strictly prohibited.
As a reminder, today's call is being recorded. You may listen to the webcast replay of this call by going to the investor relations section of TheStreet's website.
I would now like to turn the call over to Mr. Eric Lundberg. Please go ahead, sir.
Thank you, Tom. Good afternoon, all and thank you for joining us to discuss TheStreet's financial and operating results for the second quarter of 2016. With me today is Larry Kramer, Chairman of our Board and David Callaway, President and CEO, who officially joined the Company on July 6.
Today, we will review our first quarter results and discuss industry and market dynamics. First, I need to provide our legal disclaimer. All statements made on this call, other than statements of historical facts, are deemed to be forward-looking statements as that term is defined in the Private Securities Litigation Reform Act of 1995. Such forward-looking statements are subject to risks and uncertainties, including those described in the Company's filings with the SEC, that could cause actual results to differ materially from those reflected in the forward-looking statements.
Although the Company believes the expectations reflected in the forward-looking statements are reasonable, the Company cannot guarantee future results or occurrences. The Company disclaims any obligation to update these forward-looking statements, whether as a result of new information, future developments or otherwise. You may obtain copies of the Company's filings with the SEC at the Commission's website at www.SEC.gov. For more information relating to the risks and uncertainties involved in our forward-looking statements and the Company generally, please refer to the risk factors and forward-looking statements section of our recent filings with the SEC, including our latest Form 10-K and 10-Q.
I would now like to turn the call over to Larry.
Okay, thanks, Eric and welcome, everybody. Since our last call, we continue to move forward to position the Company for growth. I'm excited to say that on July 6 Dave Callaway officially joined the Company, assuming the role of CEO. Dave is just the right person at the right time to help build out TheStreet as a profitable, growing company.
Make no mistake, we brought him in to double down on what we believe will be the key to our success, quality content. Content is at the heart of all of our businesses across the board. Dave has built quality content everywhere he has been, from Bloomberg News, where he was European Markets Editor in London, to MarketWatch, where over a dozen years he built the most successful purely digital news start-up in history, to U.S.A Today, where he served as editor of the largest newspaper in America and in four years built it into a digital content powerhouse with more than 100 million monthly unique users and over 1 billion page views a month.
With stronger content at all of our products, the efforts we're also making to improve our technology and distribution of that content should guarantee improved results. Dave's expertise goes beyond markets reporting and includes coverage of financial institutions in the U.S. and abroad, particular Europe. He is already bringing a new excitement and passion to TheStreet.com, to The Deal and to the premium products in our consumer business. He is working on ambitious plans to add more content creation to our existing databases, too, BoardEx and RateWatch which will enhance the value of those extremely important databases and broaden their appeal to new and larger audiences.
Our new CEO is off to a fast start, working with his new editor, Tara Murphy, to accelerate the changes we started to make last quarter as we built our one-newsroom concept across all of our products. And he is working with the new President of TheStreet.com, Margaret de Luna, on major changes to our premium consumer products and overall product development strategy.
He is also working with Michael Crosby, the President of The Deal and our B2B products, on new revenue streams for BoardEx and The Deal, where we have launched our own blue-chip studio to build content for our partner companies and leverage our expertise as storytellers and experts at content and context to help them communicate to their own constituencies.
So you can see we're moving quickly to get this Company where we want it. We're combining our strategy of improving our content offerings with a complete overhaul of business operations to make them much more sophisticated and to take advantage of new technologies and data management services and improve our efficiency in marketing and selling to our existing and new audiences. It's an ambitious series of initiatives we believe will result in better products reaching more customers who are more satisfied and even delighted with what we're giving them.
Now let me first introduce Dave Callaway.
Thanks, Larry and hello, everybody. I am just a few weeks in, but already I have spotted pools of talent across our businesses here that can be used to rapidly push us forward. As Larry described, my background in financial news and information has been strong on both the retail and the institutional side to the businesses.
TheStreet's brand recognition in both of these areas is strong as well and I see opportunities in content and, importantly, new technologies to grow each of them. I'm particularly struck by our powerful list of institutional clients. I am already developing plans to serve this client base better wherever and whenever it needs and to expand more broadly into other institutional markets. The key to growing this market is the proper meld of data and quality content. Data journalism these days is one of the hottest buzz phrases and yet one of the most misunderstood concepts in the media world. We're sitting on vast troves of data, whose capabilities to help our clients and readers we have only started to imagine.
Most of our competitors are looking for data to work with; we already have it, a huge plus. At the same time, I've already begun working with the news team here in New York to improve the reach and breadth of our daily markets and investing content, with a continued rapid move into mobile, our top priority. Over the coming weeks, I plan to visit every one of TheStreet's major offices on three continents and size up how best to leverage the talent, technology and data assets we have so we can make the most of the second half of this investing year.
At this point, I would let Eric give you an overview of the second quarter and then Larry and I will share with you our plans and strategies for this year and beyond.
Thanks, Dave. Let me first start by reviewing our second quarter results. In the second quarter of 2016, our total revenue was $16.3 million, a decrease of $800,000 or 5% compared to the prior period. Our total business-to-business revenue which includes subscriptions, licenses and fees and events for our three B2B main products which are The Deal, BoardEx and RateWatch and our growing institutional conference businesses, totaled $7.5 million, an increase of $300,000 or 4% compared to the second quarter of 2015.
The Deal revenue grew 10%, primarily from higher media income and from the strong performance of the corporate governance event held during the second quarter of this year. In addition, BoardEx revenue grew 3% for the quarter, even with the exchange rate negative impact between the U.S. dollar and the British pound causing a decline of $200,000 this quarter over the same period last year.
Without any FX loss, the organic growth for the quarter for BoardEx was 10%. This was partially offset by a decline in RateWatch income of $95,000 or 5% versus the same quarter last year which resulted from a decrease in the average number of subscribers and a flat average rate per unit. The decline in activity is primarily due to the prolonged stagnation of Fed rates over the last several years.
Our total business-to-consumer revenue was $8.8 million, a decline of $1.1 million or 11% compared to the second quarter of 2015. B2C subscription revenue for the second quarter of this year was $5.8 million, a decrease of $1.2 million or 17% from $6.9 million in the second quarter of last year. This decrease was primarily related to a 14% decline in the weighted average number of subscriptions, combined with a 3% decrease in the average revenue per subscription. B2C media revenue in the second quarter was $2.8 million, an increase of $100,000 or 4% compared to Q2 last year. The increasing quarter resulted from the attraction of non-repeat advertiser placements in our websites.
As a result, in the second quarter of 2016, 54% of our total revenue was from our consumer-facing businesses and 46% of our total revenue was from B2B services revenue. Looking at a further breakdown, total subscription revenue represents 78% of our revenue and of that, 55% was B2B and 45% was consumer.
Operating expenses which includes cost of services, sales and marketing, G&A, depreciation and amortization and restructuring and other charges, for the second quarter of 2016 were $17.1 million, a decrease of $300,000 or 2% from $17.5 million in the prior-year period. The decrease in operating expenses during Q2, compared to the same period last year, resulted from lower cost of services, sales and marketing and D&A, partially offset by higher G&A and restructuring costs. Savings and cost of services of $400,000 resulted from lower consulting, data, recruiting, hosting and Internet access costs and the move to a centralized editorial newsroom. This was partially offset by costs incurred from the corporate governance event held during the period which generated $300,000 in revenue.
Declines in sales and marketing expense during the quarter over the same quarter last year resulted from savings in statistical services, promotion cost and credit card processing expense, partially offset from higher costs associated with the annual shareholders' meeting and higher online advertising to attract subscribers.
The D&A decrease was the result of increased expense in the second quarter of last year, resulting from the accelerating and fully depreciating the remaining book value of fixed assets acquired from The Deal. Partially offsetting these declines was the increase in G&A expense during Q2 of this year which increased $200,000 or 5% compared to last year. Higher professional fees resulted during the second quarter of this year, compared to the same period last year, from increased reliance on outside counsel during this period as we had turnover in our internal General Counsel position, as well as accounting fees related to the ongoing sales tax cleanup. This increase was partially offset by decreased compensation and related fees, primarily resulting from the resignation in February of the Company's CEO and the vacancy in the GC department.
Recruitment costs related to the resignation of the Company's President and Chief Executive Officer were incurred in the second quarter of this year and recorded in restructuring and other charges. The Company reported a net loss attributable to common stockholders of $1.2 million, compared to a net loss of $800,000 last year. Again, excluding the restructuring and other charges, the net loss was $1 million. Adjusted EBITDA was $700,000 in the second quarter, down $400,000 compared to the same quarter last year.
Turning now to June 30 year-to-date results, revenue totaled $32.4 million or $1.7 million or 5% under the same period last year. Business-to-business revenue of $14.7 million for the six months ended June 30 of this year increased $300,000 or 2%, while business-to-consumer revenue of $17.7 million declined $1.9 million or 10% year to date as compared to the same period last year.
Year-to-date growth in the B2B revenue line resulted primarily from strong media revenue which increased $200,000 or 39% over the prior period. Strong response to The Deal's corporate governance event held during the second quarter was the main driver to the growth in this category. In addition, higher subscription revenue in both The Deal and BoardEx also contributed to the year-over-year revenue increase. Although BoardEx revenue had revenue growth of 1% year to date, it was negatively impacted by the foreign exchange between the U.S. dollar and the British pound. Without the foreign-exchange losses, BoardEx revenue grew 7% year to date.
This was partially offset by lower RateWatch revenue which totaled $3.6 million, a decline of $100,000 or 2% over the prior period. This decline primarily resulted from fewer subscriptions and a flat average rate per unit as compared to the prior year.
B2C revenue year to date through June of this year totaled $17.7 million, as compared to $19.6 million last year. Lower subscription revenue of $2.3 million was partially offset by higher media income of $400,000 during the year-to-date period. The decline in subscription revenue was primarily the result of lower subscription counts. We have identified this in prior quarters and have been proactive in stemming the decline with the addition of a new head of TheStreet.com and we have implemented strategies to turn this trend in the coming quarters.
Operating expenses which includes cost of services, sales and marketing, G&A, depreciation and amortization and restructuring and other charges, year to date through June of this year were $36.4 million, an increase of $1.3 million or 4% from $35.1 million in the prior period. The increase includes a $1.4 million charge related to the departure of the former CEO, as well as $1.4 million in accrued sales tax expenses. Excluding both these one-time charges, operating expenses were $33.5 million, an improvement of $1.6 million or 4% compared to the prior year. The Company reported a net loss attributable to common stockholders of $4.7 million, compared to a net loss of $1.8 million in the prior period.
Again, excluding the one-time charges, the net loss was $1.7 million, a decline of $100,000 or 1% compared to the prior year. Adjusted EBITDA year to date through June was $1.4 million, as compared to $1.7 million during the same period last year, a decline of $200,000 or 14%. The Company generated $700,000 in operating cash flow through the second quarter of 2016, compared to $800,000 for the prior-year period. The slight decline resulted primarily from the increased net loss for the period, partially offset by the change in balance of accrued expenses over the period.
Turning to the balance sheet, the Company ended the quarter with cash and cash equivalents of $27.2 million, down $1.3 million from $28.4 million in the prior year. The decrease in cash and cash equivalents was primarily the result of an increase in net cash provided by operating activities of $700,000, offset by CapEx of $1.6 million and the effect of the decline in the U.S. dollar relative to the British pound in the quarter of $400,000. For 2016, no cash dividend payments were recorded.
I would now like to turn the call back over to Larry.
Thanks, Eric. I think you can see that we have done what we have had to do to stabilize the business, all our businesses and to begin to rebuild them in ways that reflect the new realities of our marketplace. We're excited and extremely optimistic with what we're seeing so far.
We have begun to develop new business and revenue opportunities across the full range of our products. On the B2B side, we're seeing those businesses start to grow new revenues for the first time. In June, we hosted the Corporate Governance Conference that Eric referenced here in New York that was both a critical and financial success, bringing major players in governance and activism together to help define best practices for companies dealing with entirely new levels of shareholder involvement. Besides generating $320,000 in revenues, we have extended its reach to new markets by the creation and publication of a fabulous multimedia e-book which captured the lessons that the conference taught us about what is really going on out there.
We're convinced that this is the first of many conferences on this topic which we're uniquely qualified to present because of both our editorial expertise in these areas at The Deal and TheStreet and because of the depth of data we bring to the table from BoardEx and Deal databases. We're following up in September with our first European-based governance conference in London. On the B2C side of our business, we're also beginning to innovate and target content to our unique audiences. At TheStreet.com, we have seen an explosion of interest for our content on mobile devices.
With the launch of our new responsive website, we have also created a much better mobile experience, with our audience up 134% on mobile platforms in just one year. We have similarly created additional advertising and sponsorship opportunities on that platform. We're getting closer to the launch of a new app platform which we're developing with Apple's help, for all of our consumer products, including both advertising-based and subscription products. The new platform will closely reflect the demands of our real-time customers for more timely alerts and content and more personalized products that give users more of each of what they want.
On both sides of our business, we're expanding our capabilities to help our business customers, both advertisers on the consumer side and partners on the B2B side and we're going to help them take advantage of new opportunities to reach their constituencies. From the growing business of native advertising, where companies are choosing to be more sophisticated and direct their messaging, to our new Blue Chip studios which help us create more content for our B2B clients to communicate in more sophisticated ways to their many audiences, we're responding to the changing marketplaces and the need for new and greater storytelling devices.
We have a long way to go in these areas, but we will be addressing them aggressively over the next several months. Our consumer subscription business is getting a total overhaul. We're re-examining and upgrading our product offerings, installing new technology to help us maintain closer and better relationships with our customers and build much more personalized products. We're building a business that we believe will help us build a much closer and deeper relationship with all of our subscribers. In our institutional businesses, we're integrating our deep and more valuable exclusive databases with sophisticated journalism that helps make that data even more valuable by detecting trends and revealing insights from the data. Both M&A data from The Deal and relationship mapping data from BoardEx are being used to give our customers unprecedented access to valuable information about corporate actions.
In the phones businesses, we're reaching out with more personal contact to our customers through everything from monthly conference calls between Jim Cramer and Jack Mohr and their consumers and customers for their products to very powerful events featuring industry-leading speakers and many of our own experts exploring the biggest issues facing our institutional partners. So there's a lot going on. We're working hard to make all these improvements as quickly as possible. Please be patient with us as we install and launch all these new features. As we said a few months ago, we hope to be able to show you a much improved and more profitable set of products by the end of the year and we're getting excited to do just that.
Let me turn this over to Dave again to make some additional comments before I close.
Thank you for all your interest as we continue this investing here. We have great assets here and are each week continuing to identify new ones that can help us grow when prudently incorporated. When I meet many of you over the coming months and speak next quarter, I expect to have a more defined strategy on how we can leverage our businesses for 2017 and beyond.
With that, Operator, we would like to open the call for questions.
[Operator Instructions]. And we do have a question coming through from Kara Anderson, B. Riley & Co.
Just looking at RateWatch, I think last quarter it was up and that actually surprised me. What was the difference between Q1 and this quarter?
Kara, it's Eric. Last quarter, in the first quarter, we had more one-time product sales than we had in Q2 this year, so what we have been seeing in RateWatch is a very slow and minor decline in the number of subscribers and reports, as that business is contingent upon rate changes and there have been, what, one rate change in the last eight years or so. So, the level of activity has been declining there. Last quarter, we sold more one-off revenues. There is roughly about 8% to 9% of the total revenues at RateWatch are one-off product sales and Q2 is normally a little bit slower and this Q2 was even a little slower than that. We expect one-offs to come back a bit next quarter.
And then for BoardEx, can you talk about the impact from currency that we might expect for the remainder of the year?
Talk about the effect of currency?. We have been hammered so far, as I said. Year to date, we have had a couple of hundred thousand dollars which has affected us over 4 percentage points in terms of growth. That business is up almost 7%, 8% year on year. We're seeing new business strong, but we're getting negatively impacted as we have to convert our U.S. dollars into pounds and then back to dollars. I would expect Q3 to be even worse because the exchange rate has dropped even further.
And then on The Deal, you mentioned some new revenue streams. Wondering if you can elaborate on that and what you have in the pipeline or if that is mainly the event business and e-book you discussed?
Sure, a couple things we could talk about. One is the new governance conference in London and some other conferences we're looking at doing. Another is the Blue Chip studios, where we're sitting down with all of our regular customers for BoardEx, particularly for BoardEx, but also for The Deal, who get enormous amount of content from us and working with them to turn some of that content into specialized publications for them to share with their users or their customers or their employees or whoever they feel it helps.
So, for example, a recruiting firm in London could use us to build -- to take data out of BoardEx that talks about directors and gives you a deep background about the trends in directorships and who is getting them and how many directors are women, how many directors are new, what's the average age of directors, things like that and create a publication, send it out to their customers as a way of showing that they are a thought leader in that space, that they are knowledgeable about the positions of directors which makes them appear to be a more attractive partner for a business that is looking to hire directors.
We have so much great information that helping our customers understand how to use it is one of the best things we can do, not just selling it to them, but really helping them understand how it is best used and how it can improve their business. And in today's world, with companies having to spend more and more time communicating with each of their constituencies because in this digital world, every company is a media company. Every company has to communicate now. We can help them do that. So that's another form of the business.
And finally, we just added all this coverage in Europe of the M&A businesses out there as an expansion of our Deal newsroom. European M&A coverage is actually a new category for The Deal. So we think that's a new area that could help us gain European Deal clients because we weren't previously covering their own developments. So those are just examples in that world and I think you would have said the same for native advertising in the consumer business a few years ago which we and everyone else are doing now.
And then, just speaking about the B2C subscription revenue business, you mentioned you are addressing the decline. It seems a lot of what you're doing will take time to pay off and I'm just wondering if there are any short term triggers you plan to pull in order to slow the decline in paid subscriptions in that business.
So there is the obvious restructuring of the underlying technology that runs that business which will help us identify better customers for each product and more likely customers and people who will pay perhaps more for certain information than we have traditionally understood. But on the product side, we're looking at the kinds of products that would be more appealing to audiences in today's world, so more retirement, with the growth of baby boomers hitting retirement age, more retirement products, more wealth preservation products. That hasn't been our forte, so we're looking at that.
We're also looking at changing the relationship with a lot of our customers to be more like a membership or club relationship where we actually impose ourselves a little bit more into their lives and not just sending them information, but bringing them together with each other, bringing them together with speakers and with interesting people. We think in today's social media world, that's become much more important. The contact you have with your customers, the ongoing contact and the relationship you build with them has to be more than just we send you information. There is a more conversational thing.
So we're working on products that do that right away and we have seen great pick-up on the personalized stuff where Jim Cramer and Jack Mohr, for instance, go on these conference calls. They engage hundreds, even thousands, of their customers on a fairly regular basis, monthly basis, talking about what's behind their decisions, why they do them, taking questions, getting more specific with them. It's a higher level of service. I think an improved customer support and service operation there will probably help us in the short term, too and that's one of the areas where we're spending some money on.
We're spending a lot of time working through that side of the business. The key, as Larry said, is I think taking advantage of mobile and social to tweak our marketing and our distribution efforts on that business. We hope that will begin to yield some sharp turnarounds quickly, so we're putting together a definite new marketing plan.
I'm speaking at The MoneyShow in San Francisco in a couple weeks. We're going to have some stuff, along some of the consumer subscription products tied into that. So, you will be hearing a lot more about that side of the business from us in coming weeks.
And then just a follow-up question on this, you mentioned Jim Cramer's involvement on his product. Can you speak and maybe you can't, about the performance of Action Alerts PLUS versus the other subscription newsletter products?
Actually, it is performing pretty well. In the last few months, it seems to have picked up to be maybe our best performing product. I think Action Alerts PLUS maybe. Actually, RealMoney has performed well throughout. That is the one product that has been steady, that never really suffered major declines and Action Alerts PLUS which they put a lot of time into, shows a highly engaged audience and the recent, I would say, two months has shown a much more solidified base and people -- a much higher engagement on the part of its users.
And I think those two which, again, there is a big effort that goes into those. Jim has a good staff there and we have really worked hard to bring the personalization. We have tried a lot of the ideas of the conference calls and stuff like that, first with some of his products and he is so popular that you have a better chance of making that stuff work when you're using Jim and so, it has worked.
So I think we're quite pleased with his products and his devotion to them because he has worked tirelessly to really do whatever he has to do to make those products what his customers want. And he knows it is a changing world. It is hard to do. So we test lots of things, but clearly paying off in his case. So, we have seen significant help there.
[Operator Instructions]. We will go next to William Gibson with ROTH Capital Partners.
A couple of questions, please. Do acquisitions play a role in your business model here?
Well, what we said a quarter or two ago is that we really wanted to focus on building the business this year. I think one of the problems we have had in prior years was we may have spent too much time on acquisitions or on thinking acquisitions would solve issues in the Company. We have made a bunch of acquisitions. We have only just begun to absorb them. In some ways, I think these were good -- in a lot of ways, they were great acquisitions. I think we were -- because we weren't working as hard on operations as we should have, I don't think we made the best use of some of these acquisitions or benefited from them as much as we could have.
So, we have to do that better. We have to -- and we said and we're, we have taken the money that was on the dividend and we have reinvested it in building those companies, particularly up in technology, sales and key areas that I think they were being starved in. So, we've really got to make the acquisitions we bought work. That said, we haven't closed the door to anything and we always are on the look for fairly easy to do tuck-in acquisitions that won't drain us, that won't hurt us, but can go right into a business and help it right away, that can be accretive quickly. We're always looking at those.
And there are some of those that are probably out there and we talk to them. And if, depending on the climate, the price may get right on some of those and we will look at them. We're sitting on a reasonable amount of cash. We're not having cash flow problems. We have got a lot of cash and so I think that was the plan. We're careful about how we're reinvesting and at the same time we've invested a lot of new money into the Company, we have actually saved a lot of costs in our operations. You have seen operationally our costs are down and I think that will continue. We have absorbed -- besides the one-time costs that Eric mentioned that were far or much larger than the increase we had, we have had significant legal costs this year.
We went without a General Counsel for many months and thankfully, she is here now, sitting right next to me. Heather Mars is here. But up to this point, we have had to spend a lot in legal fees and that are extraordinary to what we've had to do. So, we're in good shape to make an acquisition if we want to and we do get approached by people who are looking at partnerships or roll-ups and things like that. So we're looking at them. But our plan was to take a year and take a breath and improve the business, so that by the end of this year you are looking at a healthier business with better margins that is profitable and then build on that and hopefully get our stock up a little and which would allow us to use perhaps some of our stock as currency, too, in some of these acquisitions.
So we're looking around and we're talking to people. We don't shut the door on anybody who wants to come and talk about that. We're just not out aggressively looking which I think was more the MO in previous years.
And just one follow-up, looking out a year and just what you talked about what you are working on, it seems like B2B may pass consumer.
We watch deferred revenue which is an important internal metric for us and over the course of the last year, BoardEx has had an 11% increase in its deferred revenue number. That's the bet right number we want. That's the number we want to grow. By the end of this year, I hope to be saying -- giving you good news about deferred revenue across the board on all of our products, maybe a little tougher on the consumer subscription products, but we're working on it. But I think on our B2B products, certainly BoardEx and possibly The Deal and RateWatch could all turn around and give us more deferred revenue going ahead and that would show a healthier business and what we're hoping for.
But the BoardEx numbers have over recent months really started to show. In fact, I think last month we signed more contracts -- it was in June, so it would be -- we signed 16 new contracts, with the biggest -- largest deferred revenue number we have ever had in a month. It was a seven-figure number. It was really a good number.
So we're signing the contracts and as I said at the beginning of the year, you don't really see the revenue in those things in GAAP for a little while because you have to get them started, then they are broken down over the life of the contracts, but you do see them in the deferred revenue number. So, we're very happy to start to see numbers there. But we will hopefully by the end of the year be giving you a bigger insight into that number and into the core of the business and how it is changing.
That's all the questions we have in the queue at this time. Mr. Kramer, I would like to turn the call back over to you for any closing remarks.
Yes, just a brief one. First of all, thank you all for your interest in TheStreet and I hope you can see how excited we're about building the Company that we're building and the potential great returns for all of us. Now that I've returned to my position as an independent chairman of the Company, I want you to know that I'm continuing to buy more stock on my own, as soon as I'm allowed to, this week, because I personally believe in everything we're doing here and what the team is doing.
And I want to also say many of you may have noticed that we have already teed up proposals to adopt best practices in our governance, including changes in voting practices and the proposed annual election for all of our directors, both very shareholder-friendly moves on our part because we think that's the direction we will be moving in on a continuing basis.
So, I want to thank the shareholders who have been very kind to us over the past many and bore with us over the past many months and I am hoping will continue to do so for the rest of the year as we continue to turn the Company. We intend to reward you as best we can and for what it's worth, I want to tell you it's become a lot more fun working here. So we get to know some of the new people here again over the next few months. I think you're going to like what you see.
So thanks very much and we look forward to seeing you next quarter.
Ladies and gentlemen, this does conclude today's conference. We appreciate your participation.
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