Integrated Silicon Solution, Inc. F1Q10 (Qtr End 12/31/09) Earnings Call Transcript

| About: Integrated Silicon (ISSI)
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Integrated Silicon Solution, Inc. (NASDAQ:ISSI) F1Q10 (Qtr End 12/31/09) Earnings Call Transcript January 28, 2010 4:30 PM ET


Scott Howarth – President and CEO

John Cobb – VP, Finance & Administration and CFO


Edwin Mok – Needham & Co.

Mike Crawford – B. Riley & Co.


Good day everyone and welcome to the ISSI fiscal first quarter 2010 quarterly earnings conference call. As a reminder, today’s conference is being recorded. At this time, I would like to turn the proceedings over to Mr. Scott Howarth, Chief Executive Officer. Please go ahead, sir.

Scott Howarth

Good afternoon and welcome to ISSI’s conference call for the quarter ended December 31, 2009. I am Scott Howarth, President and Chief Executive Officer, and with me is John Cobb our Chief Financial Officer. Before we proceed, I have asked John to comment on the nature of this call and any forward-looking comments that may be made.

John Cobb

Thanks Scott and good afternoon. During the course of this conference call we will provide financial guidance, make projections, comments and other forward-looking statements regarding future market development, the future financial performance of the company, new products or other matters. We wish to caution you that such statements are just predictions or opinions, and that actual events or results may differ materially due to fluctuations in the marketplace, delays in developing new products, changes in demand or supply, or adverse developments in the global economy.

We refer you to the documents ISSI files from time to time with the SEC, specifically our most recent Form 10-K filed in December 2009. These documents contain and identify important factors that could cause our actual future results to differ materially from those contained in our financial guidance, projections, comments or forward-looking statements.

Scott Howarth

Thank you, John. We are very pleased with our results in the December quarter. The recovery in demand we saw during the June and September quarter continued into the December quarter, resulting in 8.9% revenue growth quarter-to-quarter. The demand recovery was strongest in the United States and Europe, but we saw growth in all our markets and geographies.

Overall end market demand remains below the peak levels prior to the worldwide recession, but the demand for memory continues to improve. DRAM pricing continue to improve during the quarter in our target markets as we saw increases of approximately 10% for some products in various market segments.

This pricing recovery shows a growing demand for DRAM, and also a much healthier balance between market supply and demand. Our product mix also shifted to higher margins products and market segments, such as automotive, which helped to grow our margin this quarter.

Also as a result of the improved supply and demand condition and our improved mix, we achieved one of the highest gross margins in our history and the highest quarterly gross margin since 1996 when we were selling mostly SRAM.

Looking forward, we think much of this momentum will continue to the March quarter. We enter into March quarter with very strong backlog, and also strong backlog for the June quarter. So far, our bookings this quarter have also been very good. Our employees worked hard to do everything we could to improve the company, grow our business and support our customers, and these results show their hard work.

In addition, we had a strong quarter of design-wins and continue to see a high level of customer design activity as our customers continue to face shortages and seek stable DRAM and SRAM supply, and long-term support from ISSI.

Our revenue for the December quarter was $50.6 million. This compares to $46.4 million in the September quarter and $37.7 million in December 2008 quarter. Our gross margins were a highlight of the quarter as we achieved a gross margin of 39.8% in the December quarter. This margin includes a 7.7 percentage point net benefit from selling previously reserved inventory.

This compares to the 36.5% gross margin in the September quarter, which included a 10.8% percentage point benefit from sales of previously reserved inventory. Excluding the inventory reserve benefits, our margins increased significantly this quarter as we saw the benefits of improved mix, the cumulative effect of better pricing in certain target markets, cost reductions and better inventory management, all contribute to this increase. Going forward we do expect these factors will hardly benefit our gross margins.

With our higher revenue, much improved gross margin and overall cost control we were able to achieve a net income of $7.2 million in the December quarter. This was the best financial performance we have achieved in nine years. We are very proud of the fact we have enabled to come out of the recession so strong and demonstrate many of the positive results that we made during the recession for this profitability.

Looking ahead, visibility is improving but we still see uncertainty in some of our end markets given today's continued uncertain economic conditions. Still we believe that our strategy is sound, we have the right products for our key markets, a very strong customer base, and we remain focused on long-term revenue and profit growth.

When we ended this recession we set two goals, to be cash flow positive and to strengthen the company. We clearly exceeded our first goal of positive cash flow and now have delivered two consecutive quarters of profitability.

In addition, we have added two new engineering teams to our company, which will focus on new and advance memory products, such as the one gigabit DDR2 DRAM that we just announced this week. We also improved productivity and strengthened our position with key customers. We are very optimistic about our long-term growth prospects and will continue to work hard to keep building a stronger company.

ISSI is a leader in high quality memory products, and our goal is to continue to extend our products into new applications and markets that require high quality and long-term support.

In the past few years, we have transitioned our business to be a supplier of high-value specialty memory and in doing so has steadily improved our gross margins despite very difficult memory markets. We continue to manage our business carefully, control the areas we can, and reduce our exposure to a risky commodity memory market. Our financial results show clear evidence of the success of our strategic direction and hard work of our employees. We believe we have established an excellent foundation to continue to drive our strategy and penetration into our markets.

Now, I will turn to our key markets and products. The DRAM market continues to strengthen in the December quarter. Demand was the strongest we have seen since 2008 and the pricing was the best we have seen in several years. As a result, our total DRAM revenue increased more than 13% on a sequential basis. DRAM represented 54% of our total revenue in the December quarter. Our focused DRAM business represented 47% of total revenue, while the commodity DRAM business represented 7%.

We began the March quarter with the strongest backlog in over a year and December orders have also been strong. Many of our customers are experiencing shortages from other suppliers in SDRAM and DDR and we’ve been actively supporting these customers in gaining many new design wins. We expect this trend to continue and to gain share in our DRAM market segments. For the March quarter we expect that overall DRAM revenue will be relatively flat to slightly up sequentially. Normally in this quarter, we would expect revenue to be down slightly due to seasonality.

During the December quarter, demand for our focused DRAM strengthened in all of our markets. We also had a very strong quarter in design wins. For example, we had several large DRAM design wins for automotive infotainment systems, mobile internet devices, industrial measurement equipment, computer servers and several other designs for automotive and networking applications. We also achieved numerous key design wins in the automotive, telecommunications and consumer markets in both Y-16 and Y-32 configurations. In addition, we announced the introduction of two new DRAMs, the 512 megabit DDR2 and 1 gigabit DDR2 to a broad product portfolio targeted at our key markets. We expect both of these new devices to contribute to our revenue growth in the coming quarters. Overall, we continue to see many opportunities for us to expand our market share and grow our revenue.

Our strategic focus is to continue to drive key applications in markets that can provide sustainable revenue and profit growth. Our strategy leverages, are strengths and target those markets where we believe we can add value through engineering, quality, service and long-term support. Our broad product portfolio, customer service, long-term support and high-quality products provide a competitive solution that we believe will help further our growth in our focused market segments.

The key markets that we are focused on include automotive, networking, telecommunications, industrial and specific consumer and peripheral markets. Our goal is to use our strength to further penetrate these markets and to also expand our addressable markets for new products.

For example, one of our key market is the automotive market requires a much broader temperature range to support the high temperatures in vehicles to as high as 125°C in a highest quality memory with a goal of zero defects. We have developed extensive product and process design expertise and knowledge to meet these stringent requirements. We’ve been focused on this important market for several years and have leveraged our engineering expertise to develop specific products to serve this market opportunity.

Overall automotive demand has dropped worldwide, but we saw continued growth during the December quarter in a number of new design wins. As a percentage of our revenue, automotive revenue reached the highest level in our history at 20%. Our telecom and networking customers also require both high quality memory and long-term support in our important markets that we target for SRAM and DRAM memories.

Additionally, our strong presence in Asia provides critical technical resources, closer access to ours customers and exit leverage to our business model. We intend to increase our market share to superior execution and high quality product support. Overall, we feel that our combination of focus on strategic markets, breadth of product offering, long-term support and a low-cost model will drive our continuous success in our focused DRAM markets.

For commodity DRAMs, demand and pricing for 16-megabit to 128-megabit SDRAMs increased 10% to 15% from December quarter. Demand for commodity DRAM exceeded our supply this quarter as we supported our focus customers instead. While we continue to support some key customers in commodity markets, we intend to gradually reduce our commodity DRAM revenue as a percentage of total revenue.

As previously stated, the commodity DRAM revenue was approximately 7% of our total revenue in the December quarter compared to 9% in the September quarter, and 7% of our revenue in the December 2008 quarter. We expect commodity DRAM shipments to continue to decline as a percentage of DRAM revenue as it plays greater emphasis on our focus DRAM.

Let me now turn to our SRAM business. SRAM ASPs were generally flat to slightly down this quarter due to competition. Demand in all end markets and geographies improved from the September quarter and was particularly strong in China. Our SRAM revenue increased 10% from the September quarter and was approximately 34% of our total revenue. We saw strength in our async and also synchronous SRAMs.

During the quarter we won several major design wins in our key markets for various densities of our products. For example, we had large design wins with our 4 megabit, 8 megabit and 16 megabit asynchronous product, mainly in automotive and industrial applications. We also had other large design wins for networking equipment, industrial and automotive applications.

This quarter we made progress on new product development as we taped out two new 65 nanometer SRAMs. With our continued investment in SRAM, competitive SRAM solutions and long-term support, we’re confident that we will continue our long-term growth in the SRAM market. We expect the SRAM revenue in the March quarter to be relatively flat sequentially.

Our overall ASSP business declined 7% from the September quarter and represented 12% of total revenue in the December quarter. The December quarter demand is usually seasonally weaker than the September quarter. ASPs for serial EEPROM and Smartcard products declined slightly.

We secured several large EEPROM design wins for wireless networking and LCD panels, and had several large design wins for Smartcard in public transportation and security application in China and India. We currently expect ASSP revenue in the March quarter to be down slightly from the December quarter.

As we announced last month – excuse me, earlier this month we have formed a new business unit call Giantec Semiconductor, focus on our ASSP business that will include EEPROM, SmartCard and analog power management products.

As part of this formation, Shanghai Zhang Jiang Science & Technology Corporation invested $3.75 million into Giantec. This new ventures strengthens our business opportunity in the all important Chinese electronics market. Since ISSI still owns more than 50% of Giantec, the financials of Giantec will be consolidated in to ISSI financials.

Let me now turn to our manufacturing operations during the quarter. Wafer supply particularly DRAM has been very tight in the last few months, as foundry utilization has increased. We have experienced longer lead times in foundry and assembly in test, and did have some small supply constrained in December quarter. With DRAM capacity, fabric [ph] capacity so tight, we have entered in to a long-term supply guarantee with one of our key foundries. And it also placed long-term purchase orders with others to help insure we have the wafers to grow our business and support our customers.

This quarter we increased our inventory levels to better support a growing business. We experienced some constraints on assembly and test capacity and have made selective investments to show we have the capacity to support our business in the future.

Looking forward to the March quarter, we do not expect wafer or backend supply constraints to have a significant impact on our business. And we’ll continue to make strategic investments to ensure supply of our products.

We continue to make progress in product costs reduction programs and improvements in operation efficiency effectiveness. I’ll make some closing remarks in a moment but first let me ask John to discuss the numbers.

John Cobb

Thank you, Scott. As Scott mentioned, our revenue for the December quarter was $50.6 million which is an 8.9% increase from the $46.4 million in the September quarter and a 34.2% increase over the $37.7 million recorded in the December 2008 quarter.

Gross margin was 39.8% in the December quarter which includes a 7.7 percentage point net benefit from sales of previously reserved inventory. This compares to 36.5% in the September quarter which included a 10.8% net benefit from sales of previously reserved inventory and 20.5% gross margin in the year ago quarter.

Our gross margin in the December quarter was the highest since 1996 and reflects the significant improvement in end market conditions and our product mix shift to higher margin business.

Operating expenses were $4.6 million in the December quarter which was within our guidance range. This compares to $12.2 million in the September quarter and $12.5 million in the year ago quarter. We achieved operating income of $7.5 million in the December quarter compared to operating income of $4.7 million in the September quarter and an operating loss of $4.8 million in the December quarter a year ago.

Interest and other income in the December quarter was $300,000. We had no sales or investment during the quarter. However, we did have a $600,000 provision for income taxes in the December quarter primarily related to alternative minimum tax in Taiwan.

Net income for the quarter was $7.2 million or $0.28 per share. This compares to net income of $4.8 million or $0.19 per share in the September quarter and a net loss of $4.1 million or $0.16 per share in the December 2008 quarter.

Moving to the balance sheet, we ended the quarter with $85.2 million in cash and short-term investments, compared to $83.5 million at the end of September. We generated $2.5 million in cash flow from operations in the December quarter.

During the quarter we repurchased 244,000 shares of our stock for an aggregate purchase price of $1.1 million. Our inventories increased by $8.3 million from September 30. Our inventory turns were 4.4 turns in the December quarter compared to 6.1 turns in the September quarter as we intentionally increased our inventory level to support our growth. Our accounts receivable increased during the quarter by $2.4 million to $28.9 million, and the days sales outstanding were 53 days, the same as the end of the September quarter. Overall, our balance sheet continues to remain very strong. At the end of December, we have $3.42 per share in cash and short-term investments and at book value per share of $5.33.

Let me turn to our guidance for the March quarter. All of our comments in this conference call regarding future numbers are forward-looking comments and subject to a number of risks and uncertainties. As previously stated, we saw strength in our end markets in the December quarter, which has continued into the current quarter. However, we expect that our March quarter revenue will be relatively flat sequentially, which is better than our normal seasonal decline. In total, we expect revenue for the March quarter to be in a range from 48 to $52 million.

We expect DRAM pricing to remain flat or increase modestly, and SRAM and ASSP pricing to be flat to slightly down. Gross margins will be in the 28 to 32% range. Operating expenses should be relatively flat in the 12.4 to $13 million range. We expect about $200,000 from interests and other income.

So taking all of this into account, we expect to achieve net income in the range from two million to $3 million for the March quarter or net income of $0.08 to $0.12 per diluted share.

Now back to Scott for final comments.

Scott Howarth

Thanks John. Overall, calendar 2009 was a very challenging year for all businesses, especially for memory suppliers, as we saw some competitors exit the business and several older fabs either closed or converted to non-memory use. Demand in pricing dropped dramatically in the first half of 2009 as a result of the worldwide economic crisis.

However, the worldwide memory demand has now strongly recovered and currently DRAM demand is exceeding supply for some devices and markets. In addition, we have taken many steps to strengthen our company, even though our revenue remains below peak 2008 levels. In the December quarter, we achieved our highest level of operating profit in nine years. Despite the recent recovery, we remain cautious and are working hard to develop products for the future, support our customers, and generate profit from operations.

For our results we clearly seek success with our long-term strategy as a specialty memory provider. We are pleased that we have been able to achieve this level of success despite a very difficult economy.

In the months ahead, we will continue to focus on our five key objectives, which are, number one, to grow our customer base and the number of designing. Number two, increase our product portfolio, while maintaining long-term support in our target markets. Number three, to identify and extend our reach and to under-serve in growing markets. Number four, to serve our customers as strategic partners, and number five, to remain focused on profitable growth and efficient use of our resources.

In the past few years, the memory markets have been very difficult, yet ISSI has continuously improved its gross margin and generated cash. We believe that if we continue to successfully execute on our objectives, we’ll also continue to build a stronger business. We remain committed to achieving that goal.

We'll now take your questions.

Question-and-Answer Session


(Operator instructions) We'll begin our question and answer session with the line of Edwin Mok. Please go ahead, your line is open.

Edwin Mok – Needham & Co.

Hi, thanks for taking my question. Scott, [ph] you first saw on your gross margin guidance, does that include assumption of some previously written down inventory?

Scott Howarth

In the March quarter, we don’t expect to get much of benefit from that. Thanks but we have a large benefit in the September quarter and the December quarter, and most of the inventory that was written down and then sold, so we don’t expect much of that going forward.

Edwin Mok – Needham & Co.

I see. So if I back out that 7.7% on the December quarter and compare that to your guidance range, basically adjust that on your margins as your guidance is, is it just a little bit of conservatism there because if I back that out you get to almost for 18% on your gross margin on the December quarter?

John Cobb

Hi, Edwin, this is John. A little bit of that is product mix. We did see a surge in automotive, which as you know is our highest margin business. As we look going forward we think that maybe a little bit flatter while we start to see other segments continue to grow. So mix is having a little bit of play in there as well.

Edwin Mok – Needham & Co.

I see. So just is mix the only driver or you guys do expect price to be relatively stable, how that will count?

Scott Howarth

Overall, we think price is going to be relatively stable. In the SRAM markets, we are seeing a more competitive pricing sales due to competition whereas DRAM we expect it will be flat to maybe slightly up.

Edwin Mok – Needham & Co.

I see. Great. That’s a great segue so, on the DRAM it looks you guys pretty much are working down your commodity line of business which obviously helped your margin and helped your business, right? Is it possible that you might get to a point where you pretty much don’t do all these commodity business?

And second a fab question regarding that also was, you guys purchased this company Enable, right, I was just wondering if you can give us an update on that (inaudible) and it's that piece of business also seem good growth there?

Scott Howarth

Let me answer of those new orders you asked, Edwin, so first regarding commodity. We believe we’ll always stay above the level of commodity business that we are in. Now, even though we describe it as commodity, there are different segments. This is not kind of the lowest in commodity business that we see in China, which is lot of times DVD type of business. We’re actually supporting a lot of more homenetworking and other type of business in Taiwan with it in more kind of a tier two, tier three market segments.

So we get some benefit from supporting these customers, also we get lower cost by it, and it give us the flexibility to be able to test that inventory and be able to use it in some of our focused areas. So it does give us some flexibility. Also by supporting these customers with some of this particular – these devices, lower margin devices, it does help keep us more competitive in their particular design. So we don’t want to just walk away completely and that somebody come in. So right now we think we’ll probably stay about the dollar level we are plus or minus a little bit and ideally grow the rest of the business so we'll that percentage decline.

Now your second question regarding Enable, so we had expected Enable by the December quarter to be accretive, and we haven’t quite reached that goal yet. We are growing our overall KGD business but we haven’t been able to hit the high end of the goal, basically we had kind of a low and a high range. We have been still turning to the lower range of that revenue number that we were expecting. But we do think that that we’ll clearly grow longer term. What we are finding within the KGD business is there is a much longer design cycle than we initially expected. These designs effectively are fairly custom type of design. Once you get in you stay within that particular design or application for quite a long time, but getting in is, it takes longer than we had it initially expected.

Edwin Mok – Needham & Co.

I see, great, that was very good update. And then just on the SRAM side, John, looking through this year or this calendar year and maybe towards next year, is there any plans for having new SRAM product so when we compare this it always is talked about but nothing you’d stuck there.

Scott Howarth

Well, we are constantly designing new devices, as we mentioned, we did take out two new 65 nanometer devices. We are expanding or continue to expand our product lying in the sync area. We had a 72 meg that we have been promoting now for the last six to nine months is the 72 meg quad data rate device. We also have a 36 meg that we have been promoting, we’re designing additional devices, additional tape-outs will be coming in the 65 nanometer arena. We are also working in also ultra low power markets, so we can increase our product portfolio and be competitive in some of those markets as well.

Edwin Mok – Needham & Co.

Great and then I guess one follow-up question on the balance sheet side, it looks like your working capital have extended, I guess due to good business (inaudible) right? Anyway you can help us in terms of looking at that and what is the – how do you feel was a – as a normal level for these metrics or do you think you are kind of right level inventory and maybe right level for your receivable also?

John Cobb

I think the receivables where we are in terms of days outstanding and it's pretty typical of what we would expect. The inventories were at 4.4 turns. We try to increase our turns, so as we anticipate revenue growth we've grown our inventory. So from a turn standpoint, the inventory hopefully will go up, in terms of absolute dollars the inventory could increase a bit from where it is. And the other items I think are pretty typical of what we’d expect.

Edwin Mok – Needham & Co.

Great, okay, that’s helpful. And, so we (inaudible) your current expense level is a reasonable level, is that how you see your business, is that what it sounds like? And finally just on the cash, you obviously have good cash and have been generating cash. And what's the plan for that over a longer period of time, are you guys looking to do more, (inaudible) up your product portfolio, how do you look at that?

John Cobb

So in the past we have been buying back shares, we have made some small acquisition. So we have seen this year, we also are making some selective investments both in back end and front end, so we can maintain the supply wafer that we need for the year. So those are just some (inaudible) operational investments, but we do continue to look for ways of expanding and acquiring additional technologies or even company that would be – we think we would be a good fit and strategically accretive to ISSI. So we continue to look at all options with it. Principally when I just make certain we can sustain the growth of our business and be able to have the cash it will help us grow long-term.

Edwin Mok – Needham & Co.

Great. Maybe I missed it. Do you guys talked about your CapEx for the quarter and also what's your CapEx spend for coming year?

John Cobb

In the December quarter we spent about $600,000 for capital equipment and I think that would be fairly typical what we would expect for the remainder of the year that relative spending.

Edwin Mok – Needham & Co.

Great. That's all I have. Thank you.

John Cobb

Thank you.

Scott Howarth

Thanks, Edwin.


(Operator instructions) And we will take our next question from the line of Mike Crawford with B. Riley & Company. Your line is open. Sir, go ahead please.

Mike Crawford – B. Riley & Co.

Thanks. Couple of questions. One, on the price competition in the SRAM side, so that's a little surprising given kind of the perception that Samsung is getting out of this market and there is going to be kind of the vacuum created as a fully access, is this just a function of people trying to capture that share or what do you think is going on?

Scott Howarth

Different segments of the market segments. So the area that Samsung is vacating is really more of the higher and async markets. For ISSI that is an area that we are less competitive in. We continue to introduce new devices there, but we’re not as strong competitively in that particular market segment. So, Samsung pulled out we are not seeing a direct benefit to us to the same level as others. We are seeing more competition across somebody older either legacy ultra low power asynchronous markets still and there still continuous to be more price competitive.

Mike Crawford – B. Riley & Co.

Okay. Thanks and then as far as long-term wafer supply and purchase commitments, so what kind of pump up are you seeing and the price you have to pay for wafer banks?

Scott Howarth

So far we have been able to maintain fairly stable wafer pricing. In some cases we have seen small increases and in some cases we have seen small decreases. As I mentioned, we have entered in to contract of guarantee, long-term wafer supply. We have also done almost full year wafer purchases. So we've been able to maintain pricing then also get guaranteed supply throughout the rest of the year. In some cases we’ll even be buying wafers and banking them in the first half of the year, so we will see a little bit of increase in our inventory as we carry some extra wafers.

Mike Crawford – B. Riley & Co.

Okay, and then, I mean this is what you have to do in this type of environment. Now in the past when the industry was much more – I don’t know variable, this is the type of stuff that got companies in trouble but – hopefully that’s the whole industry is matured in the past ten years. But what, is there like a minimum revenue level you would expect required for you not to end up with some kind of excess or obsolete or stuff that might later get charged off, I mean, if your business was continued at this level may be that could be a risk but you are expecting to see increase like 10% or 20% so what is the – is there any math like that we can work out?

Scott Howarth

No, I think if we look at – you might go back a few years and I have design wins, the majority or big percentage of our revenue was targeting more than commodity revenue. Then you would see prices decreased dramatically and suddenly we would be stocked with significant inventory reserves.

At this point, we are not building up inventory in the commodity area, or instead building up inventory into our focus market segments such as telecommunications and automotive where pricing is a lot more stable typically is more contractually based either six or 12 month out. So, we won't see the same type of pricing environment. So the only major risk I would see is that if we were to hit another economic downturn life we just went through then we would be in the situation where demand was no longer there to be able to pull through what we are buying. But beyond that we don’t see the same type of environment as you are describing in risk from an inventory standpoints that we have in the past.

Mike Crawford – B. Riley & Co.

Okay, great, thanks. And then final question is if you could just maybe characterize what you would expect to be normal seasonality for ISSI, now that the strategy is more refined to it's focus products and less commodity, so a typical seasonal down quarter would be March or it might be down 5% to 10% maybe that’s – what is there typical seasonality so you can comment on for the other quarters.

Scott Howarth

Normally, we’ll see the March quarter would be down about 5% to 10% so that's pretty typical from a seasonality perspective. Then seasonality in the past few years, we would see kind of flattish for the June quarter and then growth in the second half.

Mike Crawford – B. Riley & Co.

And you don't think that's changed very much since your strategy is change a little bit.

Scott Howarth

Overall, I still think that's fairly consistent as we have seen at least last couple of years. Now, last year obviously was impossible to see. This year I think that's changing as we are seeing the economic growth starting to oversee some of the seasonal swing as well. So this year, I don’t believe is going to be a normal year, so we just have to kind of wait and see how it actually works out.

Mike Crawford – B. Riley & Co.

Okay, great. Thanks.

Scott Howarth

Sure. Thanks Mike.


Thank you very much. And it appears that there are no further questions in the queue.

Scott Howarth

Okay. Well, thank you all for participating in this call and have a good evening.


That does conclude today's teleconference. You may hang up your lines at any time and have a wonderful evening.

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