Staffing 360 Solutions' (STAF) CEO Brendan Flood on Q4 2017 Results - Earnings Call Transcript

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About: Staffing 360 Solutions, Inc. (STAF)
by: SA Transcripts

Staffing 360 Solutions, Inc. (NASDAQ:STAF) Q4 2017 Earnings Conference Call April 2, 2018 10:00 AM ET

Executives

Brendan Flood - Chairman and CEO

David Faiman - Chief Financial Officer

Analysts

William Gregozeski - Greenridge Global.

Bill Relyea - Midtown Partners

Michael Shaw - Wells Fargo

Operator

Greetings, ladies and gentlemen. And welcome to the Staffing 360 Solutions Fiscal Fourth Quarter and Full Year 2017 Earnings Conference Call. At this time, all participants are in a listen-only mode. A brief question-and-answer session will follow the formal presentation. [Operator Instructions] As a reminder, this conference is being recorded.

It is now my pleasure to introduce Brendan Flood, Chairman and Chief Executive Officer for Staffing 360 Solutions. Mr. Flood, you may begin.

Brendan Flood

Thank you, Operator. And thank you to everyone who has joined us for Staffing 360’s fiscal fourth quarter and full year 2017 earnings conference call. I’m joined today by David Faiman, our Chief Financial Officer.

I want to bring to your attention that a webcast and a replay of this conference call is available by following the link contained on the bottom of the press release announcing this call. And that this will also be available on Staffing 360’s website, www.staffing360solutions.com.

Before we get started, I’ll take a moment to read the Safe Harbor statement regarding today’s conference call. This conference call will contain forward-looking statements within the meaning of U.S. federal securities laws concerning Staffing 360 Solutions, Inc. The forward-looking statements are subject to a number of significant risks and uncertainties and our actual results may differ materially. Please refer to the Company’s filings with the SEC, which contain and identify important risks and other factors that may cause Staffing 360’s actual results to differ from those contained in our forward-looking statements.

All forward-looking statements are made as of today, April 2, 2018 and Staffing 360 Solutions expressly disclaims any obligation to revise or to update any forward-looking statement after the date of this conference call. During these prepared comments, we may make reference to certain non-GAAP measurements such as adjusted EBITDA, where applicable, we have provided reconciliations of these non-GAAP measures to the most directly comparable GAAP measures.

Now with that said, I’d like to take a bit of time to talk about our performance. When I have finished my introductory remarks, I’ll hand the call over to David Faiman to explain our financial statements.

After David brings us through the financials, I will discuss progress on our strategic aims and development before opening the call to Q&A. 2017 marked a major turning point in new solution of the company. We expanded our geographic presence both organically and by acquisitions, refinanced and streamline our balance sheet, positioned the company to generate positive cash flow beginning in 2018. And advance towards our goal of becoming a $500 million revenue company within the next two years.

More immediately, these initiatives allowed us to report record revenue, record gross profit and record adjusted EBITDA for the 2017 fourth quarter and full year. For the fourth quarter of 2017 as compared to same period of last year, our revenue grew by 29% to $59.5 million. Gross profit was up $4 million to $11.9 million. Gross margin strengthened to 20.0% and adjusted EBITDA increased by 134% to $2.8 million. The fourth quarter of 2017 is the first in which we see the full impact of the two acquisitions made in September, CBS Butler in UK and firstPRO 360 in the US. For the full year 2017 as compared to full year 2016, our revenues grew by 6% to $192.7 million. Gross profit increased by 16% to $36.7 million. Gross margin strengthened to 19.1% and adjusted EBITDA increased by $2.3 million to $7.4 million.

On a trailing 12- months basis including the two acquisitions made did their [Indescernible] for the entire fiscal year, we delivered adjusted EBITDA of $10.85 million. We also recorded certain one time charges which affected our profitability for the quarter and for the year as a whole which Dave will discuss later. Just prior to the fourth quarter of 2017, we completed a $40 million financing initiative and by renegotiating our asset back lending facilities in both US and the UK, albeit UK facility closed in early 2018, we've addressed an important issue that over the years put considerable strain on our cash availability and usage.

These initiatives and additional ones underway and which you will hear during this call have been pivotal in setting up 2018 and beyond for operational investment and growth. During the third quarter of 2017, we completed two accretive acquisitions which have added over $80 million in annualized revenue and doubled our trailing 12 -month adjusted EBITDA to approximately $11 million. Both of these acquisition transactions forward our disciplined approach in ensuring that all the required boxes were ticked. They were strong, strategic fits and earnings enhancing for shareholders. Additionally, during 2017 we continue to expand our geographic footprint. On January 1st, 2017, we're operation from five US states. Connecticut, Massachusetts, Rhode Island, New Hampshire and North Carolina, and one location in the UK, in the City of London.

By the end of 2017, we expanded our operations into three new states in the U.S., South Carolina, Georgia and New York which is also our headquarters and one further location in the UK in Greater London. We have expanded from 14 locations and six clients' on-site locations at the beginning of 2017 to 17 locations at the end of 2017 and nine clients on sites, with four of these listing locations increasing in size bringing the total internal headcount from approximately 185 people to 295 people. Furthermore, at the end of 2017, we realigned our management team to reflect the material changes in the company's condition and structure, and to drive further organic growth and integration. After you hear about the financial performance from Dave, I will discuss further what these initiatives may need for 2018 and beyond/

I will now hand the call over to David Faiman, our Chief Financial Officer

David Faiman

Thank you, Brendan, and good morning, everyone. Before I get into the details of the fourth quarter, I wanted to point out that on March 29; we filed a Form 8-K indicating our intention to amend and restate our Form 10-Q to the period ended September 30th. 2017. As such the numbers I'll discuss for the fourth quarter 2017 and included on the slide are shown as if the third quarter results have been restated. The adjustments to restate this Form 10-Q for September 30th, 2017 have no impact on our full-year results we filed in our Form 10-K and are all non-cash adjustments.

For the fourth quarter of 2017, revenue of $59.5 million was an increase of 29% against the prior year fourth quarter of $46.1 million. Revenue included $17.7 million from the two acquisitions we closed in September of 2017, while the base business declined $4.6 million from the prior year as we exited low-margin revenue and didn't see the seasonal uplift normally experienced in our commercial segment. Foreign currency impact was approximately$1.5 million unfavorable. Gross profit for the fourth quarter of $11.9 million was an increase of $4 million or 50% over the prior year. Stronger margins in the commercial segments, higher margin revenue from the two acquisitions, as well as lower working compensation costs were all contributing factors.

This had the impact of driving gross margin to 20% versus 17.2% over the prior year, a 280 point improvement. Operating expenses of $17.3 million was higher by $9.1 million against the prior year, including operating expenses of the two acquisitions, as well as $4.8 million impairment of goodwill related to our PeopleSERVE business, and a $780,000 restructuring charge associated with reorganizing the company into three segments and thus exiting the former CEO's contract. This performance translated into a loss from operations of $5.4 million and net loss of $7.5 million. However, adding back to non-cash adjustments and non-recurring cash costs underlying adjusted EBITDA grew to $2.8 million from $1.2 million in the prior year fourth quarter or an over 130% improvement.

That translates into 23.5% against our gross profit and 15% in the prior year. For the full year 2017, revenue of $192.7 million was an increase of 6% versus calendar 2016's revenue of $181.5 million. Within revenue for fiscal 2017 $24.4 million came from the two acquisitions, while the base business declined $13 million. Gross profit of $36.7 million increased $5.2 million or 16% driven by higher margin business, and lower workman's compensation insurance resulting in gross margin of 19.1% versus $17.4% in the prior year, a 170 basis point improvement.

Operating expenses of $42 million was higher by $7.6 million including operating expenses of the two acquisitions. The impairment of goodwill and restructuring charge I mentioned earlier, as well as non capitalizable acquisition and refinancing related costs associated with the transactions during the year. Our other expenses include higher interest on the higher debt, as well as losses of $6.2 million from the refinancing transactions we consummated during the year. This resulted in a loss from operations of $5.2 million and a net loss of $18.5 million. While our income statement of fiscal was burdened by a number of non cash accounting charges, the underlying performance of the business continued to improve, resulting in adjusted EBITDA for the year of $7.4 million versus $5.1 million in calendar 2016. Including the two acquisitions on a pro forma basis as if they had been owned for the entire year, our trailing 12-month adjusted EBITDA was $10.8 million.

Turning now to the balance sheet. The transactions during the year have grown and strengthened our financial position. Not only has our balance sheet now grown to $87 million, we have significantly reduced current debt obligations and ended the year with $3.1 million of cash on hand. Subsequent to December 2017, we successfully refinanced our UK borrowing facilities into a factoring arrangement with HSBC at overall more favorable economic terms. Finally turning to the statement of cash flows. Net cash used in operating activities was $7.2 million for the year, but includes $1.6 million to settle an arbitration loss. Costs of completing the two acquisitions and other non-recurring cash cost of approximately $2.1 million, as well as continued improvement in our working capital.

Investing cash flows are principally associated with consummating the two acquisitions and financing inflows are principally to fund the two acquisitions and refinance the company's capital structure.

At this point, I'll hand the call back to Brendan who provides an update on recent developments before we open the call for Q&A.

Brendan Flood

Thank you, David. As I mentioned during my opening remarks, following a strategic review of our operations in December, we realigned our business into three streams. Professional Staffing US, Commercial Staffing US and Professional Staffing UK. Each of these businesses will be led by a president responsible for organic growth, delivery cost management and integration of acquisitions made. At the moment, we appointed two of the three presidents, Commercial Staffing US from the Paul Polito and Professional Staffing UK on the Mark Darby. Mark's first day with the company will be tomorrow. The leaders of our smallest business stream, Professional Staffing US will continue to report directly to me until we make an acquisition large enough to justify the additional management.

As we've become larger over the past couple of years and specifically following the two acquisitions in September, it has become clear that we have now moved into a new phase of our organic growth program and that we need a greater degree of day-to-day focus on driving this organic growth. And on delivering on our intelligent integration program. As a team, we set certain internal goals based on several initiatives which are designed to drive strong gross margins, improved productivity of revenue and gross profit per employee, removes duplicated overheads across businesses, share clients and real estate for the benefit of the entire group, and to develop a stronger sense of unity across the group.

Already since the beginning of 2018, we have hired 15 additional people, all [power one] is revenue generating or revenue driving which amounts to a 5% increase in our headcount. In order to gain the greatest P&L impact on the year, hiring generally takes place in the first half so that the productivity levels of the new employees can have a positive impact before the end of the year. Almost without exception each of our business units has established new client relationships and signed new agreements. As a couple of examples, Lighthouse Placement Services has engaged 21 new clients in just the first eight weeks of the new year. And the commercial staffing business of Monroe Staffing Services has signed 40 new clients of which 24 are already billing.

While we continue to significantly expand the geographic footprint organically and via acquisitions, we have also taken steps to drive strong gross margins in our businesses, and have been very successful in this over the course of 2017 moving from 17.4% in 2016 to 19.1% in 2017 while exiting the year on 20.0%. We are seeing in the market that our clients are demanding more permanent placement or direct hire during this period of very low unemployment. While our firstPRO and UK businesses have strong permanent placement histories, some of the other business units have not tapped into this market and are starting to do so now.

This will not however be at the expense of our contracting or temporary hire business which provides us with greater visibility of revenue stream. As a management team, we're not against some contracts of lower gross margin if the delivery cost is also lower. And the EBITDA margin can be maintained or enhanced. I mentioned earlier that we exited 2017 in 17 Staffing 360 Solutions locations and nine client locations. We're constantly looking for opportunistic and strategic moves into additional markets. We have already added two new on-site programs with our clients in the US since the beginning of the new year, with a further two signed up to begin in across April and May.

We are currently serving as three additional markets in the US to expand the geographic footprint even further. More target markets will be evaluated and we expect that we will open a minimum of a further two new locations in the current year. The manner in which we enter a new market is to find an anchor tenant, the revenues from which our anchor client rather, the revenue from which will cover the cost of the new location so that we are at worst at breakeven scenario from day one. Our businesses are working more closely together and have started to share a client opportunities and best practices. The senior executives in both the US and their counterparts in the UK have had some very fruitful working sessions together since the beginning of January, but this is still at a very early stage.

Right now we have over 1,500 clients with little more than a handful being serviced by more than one of our brands. We have also identified opportunities for cross-border cooperation between the US and the UK that we are exploring. Currently, we have two locations. The City of London and Fort Mill South Carolina that has more than one of our brands. This gives us an opportunity to gain a geographical expansion without always requiring additional real estate and related costs.

In relation to our M&A program, we are in discussions with several parties but are in no rush to add to the brands in our portfolio, as we continue the positive work on integrating the existing businesses, and making the whole group stronger. That said our aim is to get to $500 million in annualized revenues so this will require further acquisitions in order to get there. Typically, we would expect additional acquisitions to be in the order of $50 million or more in annualized revenue. We will discuss this further on future calls. As for our stock valuation, nobody on this call is as disappointed in the performance of the stock as I am as the second-largest shareholder in the group. In addition to the rebalancing, refinancing and management realignment. we've engaged in IR IPO firm out of New York City, the Equity Group Inc in determining how to expand the institutional investor interest in our story. And how to get our message out more broadly into the market so that the changes that have been made over the past 12 months are more fully understood.

This will be a constant update point on these calls each quarter. In conclusion, we have materially transformed our business in 2017 and the opportunities that this has opened for us have generated a level of optimism in relation to 2018 and beyond. We remain committed to our goal of achieving sustainable, profitable, enterprise-wide growth beginning in 2018. It's all to me and to our management team to go on to execute on those opportunities.

Operator, at this point I would like to hand the call over to the Q&A session.

Question-and-Answer Session

Operator

[Operator Instructions]

Thank you. Our first questions come from the line of William Gregozeski with Greenridge Global. Please go ahead with your questions.

William Gregozeski

Hey, guys. In regards that low-margin people serve business, you guys are getting out of how much is left on that and when will that be completely off the books?

Brendan Flood

Bill, we don't typically go into that level of detail on individual business units. So it comes up for renewal every July. The last couple of years have been relatively positive in our favor except for the bids that we want to walk away from. But in reality, the vast majority of all remains could probably stay there forever.

William Gregozeski

Okay. So that'll be I mean what we're getting to the end of having to when you talked about organic growth we had this much organic growth, but we had to lose this or we got rid of this low margin business. I mean those days are coming to an end.

Brendan Flood

That's pretty much close. I mean that the vast majority is what we're signing up is typically coming at a higher margin than anything that we might be losing as contracts come to the end of their natural lives. It doesn't mean that that we won't find one or two pieces that we would probably rather not keep. And we're constantly evaluating what it is that we've gotten -- what we're going to do with it. There's nothing in there that's any material size. So you shouldn't expect any comments on any conference calls going forward about walking away from low-margin business.

William Gregozeski

Okay, great. And then it sounds like you have a lot of organic growth that you're seeing already in 2018. What are you guys expecting on the organic growth front for the year in total?

Brendan Flood

We said everybody a target of 10%. So we would expect that there's always a point of failure somewhere but we would expect as an average that we will achieve organic growth rates in the order of 10%.

William Gregozeski

Okay and how are you seeing gross margins for the year? Do you think they can stay around or grow on the 20%?

Brendan Flood

So some of it is down to mix as we do more permanent placement. And the margin hosting moves up. Our contract gross margins have continued to improve across last year and into the beginning of this year. There is a limit as to where it can go. So I don't think we will see the material growth in 2018 that we saw in 2017.

William Gregozeski

Okay. But do you think 20% as a number we could look forward to for the year?

Brendan Flood

I would expect, so yes.

William Gregozeski

Okay, great, all right that's all I have. I think you guys are doing a great job. And I mean at some point the markets going to recognize the work you guys are doing.

Operator

Our next question comes from the line of Bill Relyea with Midtown Partners. Please go ahead with your questions.

Bill Relyea

Good morning. Actually the other Bill answered -- ask most of my questions. So I wonder if you could just sort of review how the organic growth has been in the three business segments thus far this year. And whether you expect it to increase during the year quarterly or how do you see that?

Brendan Flood

So, Bill, we don't to this point issue guidance so but I will just reiterate what I just said to the other Bill is that our expectation is that our organic growth in 20178 will be in the order of 10%. How that splits across through business dreams, a bit too early to say.

Bill Relyea

Okay and I guess one question would be how do you see the potential in the in that region going from North Carolina down to Georgia? Are there -- that's something you've hit upon as having pretty high prospects and would you expect that to continue and maybe an area of potential additions.

Brendan Flood

So we mentioned on about probably two or three calls ago, certainly soon after we opened the Fort Mill office or trying maybe around the time we acquired firstPRO, we do recognize that South Carolina into Georgia is an incredibly fast growing economic area. So we would expect that it will be very fruitful for us.

Bill Relyea

Okay. And the only other question would be people have expressed a lot of fears about Brexit in the UK? Do you see that impacting the potential for your business there? Or are things going reasonably well?

Brendan Flood

So certainly soon after the vote came out which surprised most people I think. There was two or three month period where there was a huge amount of uncertainty. And then it got to the point where clients recognized that this was quite some way away. So they went back to normal and start growing again. Now the actual exit is just slow, just slightly less than 12 months away because it's March 31st next year. I think we're still at a point where people are expecting that the period of exit is still going to take several years. So if you're not in the financial services sector which we're not heavily into, it's less of a concern than its maybe if you're into banking stuff.

Operator

Our next questions come from the line of Michael saw with Wells Fargo. Please go ahead with your question.

Michael Shaw

Hi, Brendan, good morning. So I had a question for you. So today is April 2nd and so the first quarter is now over. I was wondering if you had any indications on how the quarter went. What -- on performance or profitability or EBITDA or anything of the sort, any type of like preliminary guidance.

Brendan Flood

So we are as you rightly say at April 2nd. Our various subsidiaries that are not expected to deliver the results for March -- for the month of March for probably another 8 or 9 days. So we don't really know. Typically, the way the year pans out is that there is a little seasonal downturn in the first quarter, partly driven by the weather. And anybody on this call who lives around Connecticut or Massachusetts will look in quite a bit of snow this year. Well really, it's a huge impact for us, certainly not what it was two years ago when we were --we probably lost an entire week of snow. Our expectation is that our first quarter is going to be pretty well in line with the plan that we have internally, but in order for you to find out exactly what that looks like, Michael, I would suggest that you dial into our conference call that we will hold in the middle of May. And we'll give you chapter and verse on it. But we certainly haven't seen anything to cause any alarm.

Michael Shaw

Right, it's not necessarily what I want, but what about on the outside. I mean have you been pleasantly surprised or anything in the last, in the last quarter because I know that you've been talking about some of this --some of the synergies, some of the operational improvements. I was wondering if that was pretty much in line or if that was ahead of expectations?

Brendan Flood

So there have been some very pleasant surprises like I mentioned the two examples in my script of Lighthouse Placement Services got 21 new clients in the first eight weeks of the year. It didn't get 21 new clients in the previous three years added together. So Eric Schwartz and Joshua had really, really did phenomenal job up there. And under Paul Polito's 0team, we've gained 40 new clients in the course of the first or 10 or 11weeks of the year with Monroe Staffing commercial staffing business. And 24 of those are already billing and we would expect the other 16 to be billing over the course of the next two to three months. So in terms of developing new client relationships, developing new prospects, I think there have been some very positive upsides.

Michael Shaw

Got it, okay. So I remember in last quarter's conference call also there was some indication or some guidance that positive income was going to be coming the next two quarters. And clearly last quarter wasn't necessarily positive. So I'm sorting then I mean are you backing off that guidance because I didn't hear anything about that coming from you guys this quarter at all?

Brendan Flood

Yes. We're looking partly because of these only non-cash US GAAP charges that we keep getting bashed with. If you ignore all the non-cash charges, we are quite seriously positive cash -- positive net income, but I think as far as that guidance is concerned it probably goes out of order.

Michael Shaw

Okay. So then what you're saying then is that the one offs are going to continue into the next couple quarters?

Brendan Flood

The non-cash one also will continue, yes.

Michael Shaw

Okay. I mean so I mean like something like PeopleSERVE for example is a kind of a good example where you said you went down this thing to zero and you said that was an acquisition that was before you take your time. I mean are you indicating or are you suggesting that there are other land mines like that are kind of looming?

Brendan Flood

No. With the $4.8 million write-down of the goodwill and PeopleSERVE that is the entirety of its remaining goodwill. So --

Michael Shaw

Right but what about other businesses though I mean seems like that there were -- I mean there were other businesses that were acquired over time and if you're suggesting that there are other non-cash write offs that are coming in the next couple months or quarters, I mean there aren't that many places it can come from? I mean it has to come from one of the businesses being written down or acquisition cost being --some type of --something related to the acquisitions I guess. And so I guess the question then is does this mean then that there are other companies that are going to get written down or that the acquisition cost haven't been fully-- that integration costs haven't been completely included or incorporated into forward looking guidance?

Brendan Flood

So we will have some integration costs as we remove duplicate costs between various subsidiaries that we have. We don't have any concerns about any further write-downs of goodwill. What we do have the standard amortization of intangibles that are relatively fast paced in nature. So we will still continue to see some of those hitting us in the first and second quarters. But we were not -- at the moment not intending to buy anything between now and the second quarter. Well at the end of the second quarter so we don't really expect to see much if anything in terms of transaction costs for any financing or for any acquisitions that we're going to make or has made.

Michael Shaw

Okay but in terms of non-cash, right but in terms of non-cash write-down or whatever that's just going to be essentially just a standard depreciation amortization of costs. There aren't any particularly new -- new one-off charges that we should be expecting?

Brendan Flood

That's correct.

Michael Shaw

Got it, okay. Then I guess then my one last line of questioning and it has to do with I mean this all kind of ties back into where the debt load is, because when I look at this it doesn't really seem like a secret that the company has a lot of debt on adjusted EBITDA. So I mean the company doesn't seem distressed but definitely need to be careful with its cash. So just kind of going through the numbers here where you have $6 million of interest expenses, another $3 million that's going to go out for prior acquisition. So it's total $9 million. And if adjusted EBITDA last year was $11 million and you think it's probably going to be higher, let's say $13 million, then I guess another question is at least kind of $4 million left over for unadjusted -- essentially adjusted EBITDA and I was wondering what are you going to do with it? Is it mostly going to go towards principal repayment to Jackson? Or is it going to go more towards fueling growth? I just kind of wanted to get a nice rough idea of where this is headed?

Brendan Flood

So I took part of that in and I'll pitch the debt part back over to Dave. As part of my remarks on M&A, I said that we're not in a hurry. We're not in a great hurry to go and buy new stuff while we continue the good, positive work that we're doing and integrating the business that we already have. But in order to get from $260 million of annualized revenue to $500 million, we still need to go and buy stuff. So our expectation is that in the second half of the current year, we will be back in the market buying stuff and racing towards our $500 million target.

Michael Shaw

I mean I don't just agree with that. I mean I guess the question though is you have this certain amount of free cash flow if you want to call it that or it's not really free but you have some amount of EBITDA that isn't going towards your interest expenses, it isn't going towards payments from prior acquisitions. And I'm curious as to from maybe this is David's question more likely it is, but where do you foresee any leftover cash going? Is it going towards principal repayment or is it going towards or is it going to go towards something else?

Brendan Flood

It's going to go towards buying more stuff. We certainly won't sit around watching $4 million gather dust in the bank accounts. That would be a situation that we've certainly never been familiar with. And we probably won't become familiar with it. We will make every dollar that we have do some work for us.

Michael Shaw

Right. I mean I guess my question though comes down to if you're -- I mean are you going to be paying down the debt first to Jackson? Or are you going to be spending more money on this? Because I guess the question then it comes down to be you have about two and a half years left of runway on this, on this loan and it's obviously its pretty high interest. So I mean is --it becomes a question of cash flow versus or operational cash flow versus financial cash flows? And I'm curious to understand in terms of where you're prioritizing that, those cash flows?

Brendan Flood

We won't all of any of our money to sit around gathering dust. We will make sure that every dollar we have does some work us. We do expect the 12% interest rate is a pretty high interest rate. So it is something that we look at, Dave and I look at probably every month and try to figure out what it is we're going to do about it. So $4 million of free cash assessment number you calculated doesn't eat into $40 million particularly well, but we will allow -- we want to make sure that we advise the markets as to exactly what it is that we're going to do with our spare money. Obviously telling Michael that I can't answer that question on this call.

Operator

Hey, as we have no further questions at this time. Are there any additional comments you like to make?

Brendan Flood

Okay. Thank you, Brenda. So as we continue to make adjustments to our operational performance to drive organic growth and to deliver on our promises, we will expand the messaging to the capital markets about our performance and opportunities in the expectation that our stock price will start to move to an acceptable and normal level in relation to our industry peers. As a management team, we remain committed to growth in revenue, to growth and earnings and to growth in shareholder value. Thank you all. And we look forward to speaking with you again in mid-May when we report our first quarter 2018 results. Thank you, operator.

Operator

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