Nautilus [NLS] Conference call transcript for 2021 q2
2021-08-09 21:18:07
Fiscal: 2022 q1
Operator: Greetings and welcome to the Nautilus Incorporated First Quarter 2022 Earning Results Conference Call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. [Operator Instructions] As a reminder, this conference is being recorded. I would now like to turn the conference over to your host, Mr. John Mills with ICR. Thank you. You may begin.
John Mills: Thank you. Good afternoon, everyone. Welcome to Nautilus' first quarter fiscal 2022 conference call. As previously announced, Nautilus changed its fiscal year in the 12 months beginning January 1 and ending December 31 to the 12 months beginning April 1st and ending March 31st to include the primary fitness season for exercise equipment in the same fiscal year and to better align with the fiscal year-end of retail partners. Today, Nautilus is reporting financial results for its first quarter fiscal 2022 ending June 30, 2021. Participants on the call from Nautilus are Jim Barr, Chief Executive Officer; and Aina Konold, Chief Financial Officer. Please note this call is being webcast and will be available for replay for the next 14 days. We will be happy to take your questions at the conclusion of our prepared remarks. Our earnings press release was issued today at 1:05 P.M. Pacific Time and may be downloaded from our website at nautilusinc.com on the Investor Relations page. The earnings release includes a reconciliation of the non-GAAP financial measures mentioned in today's call to the most directly comparable GAAP measures. For today's call, we have a presentation accompanying the call that management will refer to during their prepared remarks. And on slide two is our full Safe Harbor statement, which we ask everyone to read. You can access the presentation now by going to nautilusinc.com and click on the Investors tab and then click on the Events and Webcast and the presentation will be right there for you. I'd like to remind everyone that during the conference call, Nautilus management will make certain forward-looking statements. These forward-looking statements are based on the beliefs of management and information currently available to us as of today. Such forward-looking statements are not guarantees of future performance and therefore, one should not place undue reliance on them. Our actual results will be affected by known and unknown risks, trends, uncertainties, and factors that are beyond our control and ability to predict. For additional information concerning these factors, please refer to the Safe Harbor statement and to our SEC filings, which can be found in the Investor Relations section of our website. And with that, it is my pleasure to turn the call over to the Nautilus' CEO, Mr. Jim Barr.
Jim Barr: Thank you, John, and thank you all for joining us today. I'm excited to speak to you today about our strong growth in earnings, driven by long-term secular trends towards home fitness and most importantly our team's strong execution. I'll then shift to an update on the notable progress we're making implementing our long-term strategy. I'll share some perspectives on my now two years at Nautilus and I'll finish by reiterating our commitment to invest for the long run. I'm incredibly proud of our team for achieving in both short-term results and progressing in our transformation, which will take Nautilus to a place that's never been before. In the first fiscal quarter, we produced strong growth and profitability exceeding our top line and operating margin guidance. This was driven by continued robust demand for at-home fitness across our portfolio of leading strength in cardio products, as well as across our customer touch points with our domestic and international retail partners and online direct segment. We leveraged our backlog, strategically built up our inventory for the upcoming fitness season and continued to manage a slew of unprecedented and temporary challenges and global supply chain and logistics to drive these results. This quarter, as a reminder, we are comping the first full quarter that benefited from COVID-related tailwinds. Against that backdrop, I'm delighted to report that net revenue was up 62% to $185 million, representing the highest June quarter and the fourth highest of any quarter in the company's 35-year history. Even more impressive, excluding Octane, revenue for the quarter was up 74% year-over-year. The Direct segment grew 26% in what is traditionally our seasonally lightest quarter, when consumers tend to be outside and not as focused on indoor exercise equipment. The retail segment continues to set records, generating its highest ever quarterly sales, achieving a record $120 million, as we began to load into retail partners earlier for the high season. This is an early indicator that our expanded stable of retail partners is betting on a robust fitness and holiday season. In addition, our international channel recorded its second highest quarterly sales, up 70% or 102% excluding Octane. Strong sales of our new connected fitness cardio machines, including our VeloCore bikes, combined with solid performance from many of our strength products, including the continued momentum of our SelectTech line, drove these better-than-expected results. The market reception to our new Connected Fitness offerings is an important driving force behind our continued growth. This past quarter, we introduced our brands to over 40,000 new customers via our website, bringing our new customer count to over 380,000 for the last 15 months. For context, our new customer count averaged about 100,000 a year pre-pandemic. The growth in direct customers and our expanding retail universe are fueling membership growth for connected product sales. JRNY membership growth accelerated after we introduced our first embedded screen product in September of 2020. And by the end of June, we had more than doubled the number of members versus the beginning of January. I'll provide additional detail on JRNY in a few moments. Our entire industry, along with countless others, continue to face unprecedented and temporary inflationary pressures in raw materials and logistics. Gross margins were affected by higher component costs, including chip shortages that are affecting many industries, as well as higher commodity prices, such as steel and continuingly elevated transportation costs. In addition, natural season channel mix shift to retail played a role. Direct was 34% of the business in this quarter versus 44% last year. I want to emphasize that we view these margin pressures to be temporary challenges as the world recovers from the disruptions caused by COVID-19. While this impact is significant in the short term, we believe these external margin pressures will normalize over time. Short-term margins do not change our view of the long-term value we are creating. Despite gross margin pressures, operating margins came in above the high end of our guidance at nearly 10%, driven by our strong topline results as well as our strategic decision to shift some North Star investment dollars from Q1 into Q2, including brand marketing for Tour de France and Olympic advertising. EBITDA was $20 million and we ended the quarter with $83 million of cash and short-term investments. As discussed at our Investor Day, and on our last earnings call, we operate in an attractive, expanding and very dynamic at-home fitness industry. Our addressable market has expanded rapidly, based on permanent changes in workout habits which favor home fitness. In the past 15 months, consumers saw that Connected Fitness could deliver on many of the elements that they used to get only at the gym, personal training, trainer-led classes, community and variety. As you know, we have continued to follow the sentiment of former gym goers for over a year now. 25% of former gym goers have consistently expressed that they have no plans to ever return to the gym and many others are changing how they balance the gym and at home based on an emerging hybrid work model. We are extremely well positioned for long-term growth with our top three market share, our strong brands, our portfolio of innovative products, our wide and expanding multi-channel distribution and an inspirational new vision and long-term connected fitness digitally driven growth strategy. We are transforming Nautilus from a product-led hardware company to a consumer-led digital company. Our strategy is rooted in five pillars, designed to position Nautilus to deliver long-term value. Our entire organization is focused on delivering these long-term goals by March of 2026: $1 billion of revenue; two million JRNY members; and sustainable operating margins of 15% with the opportunity to further expand as subscriptions become a larger portion of revenue. Achieving these goals requires investments and we intend to self-fund these investments via our pay-as-you-go philosophy. Using a long-term ROI lens, we'll invest a portion of our earnings in the following key areas: JRNY; marketing; innovation and technology; product costs to accelerate membership growth; people and capabilities; and partnerships and tuck-in acquisitions. Aina, will provide more detail on our planned North Star investments for the rest of the year. I'll now update you on some notable progress we've made, on our North Star strategy. First, on our efforts to adopt a consumer first mindset. In order to attract and retain lifelong customers, we're increasingly making decisions based on consumer insights and data. We have moved from early conceptual stages and have now implemented this approach in all areas of the company. Some examples include: we've instituted new category management capabilities and they are injecting consumer insights into our product road map; we're measuring baseline Net Promoter Scores and consumer effort scores at all key points of our customer journey. We are also closely monitoring JRNY usage and social media sentiment to make sure we prioritize the enhancements that matter most to our members. Our consumer-led approach has really transformed our marketing. As planned, we increased marketing spend during the quarter and will continue to do so throughout the year to support our expanding digital connected fitness and overall product offerings. We are targeting two specific consumer segments and continue to shift more of our spend to digital, in order to efficiently reach our target customers with newly refreshed marketing messaging. And our investment in brand marketing is paying off. Our share of voice is two times our market share and our new brand spots that we aired in the quarter are delivering traffic lists five to seven times higher than our typical direct media. We have more work to do in repositioning our brands and we plan on continuing these investments for the rest of the year. As mentioned previously, we are rapidly growing our new customer base, adding nearly 400,000 new customers in the last 15 months. The numbers tell only part of the story. We are reaching consumer segments that enjoy exercise more and for whom exercise is more of a priority. These new customers skew younger and more female. Our target consumer enjoys the flexibility of buying online or shopping at stores. I'm proud to say, we've continued to increase our points of retail distribution. We have added more than 3,000 new retail doors and greater online capabilities in retail over the last 15 months, including at Best Buy, Costco, Costco Canada, Sam's Club and Target. Internationally, we had an over 500% increase in our sales through Amazon. We now have broader and more diversified retail distribution and are functioning as a true omni-channel company with many more options for consumers to buy in-store and online. Second, transforming our supply chain. In the face of all of the challenges in global logistics, we have successfully added significant capabilities to our global supply chain. We have reduced our backlog to the lowest it's been in over a year, and expect to achieve our goal of no longer being factory capacity constrained by the end of the fiscal year. A great example of solving our supply chain problem is our wildly popular SelectTech dumbbells. This quarter, we shipped more than three times as many dumbbells, as the year ago COVID-driven quarter, and I'm happy to say, they are now available for immediate delivery on bowflex.com, and at leading retailers. This would not be possible without our suppliers and their ongoing support to help us meet the unprecedented demand for at-home fitness. We share our success with them and we thank them. Another new capability is our new distribution center in Southern California, which opened in July and is ramping up in time to receive the heightened inventory levels we have planned for the upcoming peak season. We've formed task forces focused on spot buying microchips, finding new ways to ship products across the ocean and implementing technology to allow us to expand our outbound freight partners. Because of improvements in the supply chain, we have been able to build our inventory position to be well prepared for the upcoming fitness season across all channels. Third, focusing our investments and growing our organizational capabilities. We have reduced lower margin SKUs in all areas. This improves efficiency throughout our organization, and enables all teams to be more laser-focused on our targeted offerings. Since fiscal year 2020, we have discontinued 22% of our product SKUs, and have tripled the revenue per product that we do carry. We continue to build out our organization adding executive talent like our new Chief Legal Officer, Alan Chan, a seasoned veteran with 16 years of experience leading global teams in M&A, commercial agreements, intellectual property and corporate governance. We're also building out our software development and user experience teams, category management, supply chain, social media engagement, learning and development and change management. Lastly, and perhaps most importantly, we continue to improve and grow JRNY our digital platform. Our members have told us that they want variety, highly personalized one-to-one adaptive workouts, immersive experiences, and fresh on-demand trainer-led content on and off equipment. We're meeting these needs through our innovative lineup of connected fitness products powered by our continually evolving digital platform JRNY. JRNY is now fully compatible with the wildly popular Bowflex C6 and Schwinn IC4 bikes via both iOS and Android devices. Our JRNY platform is constantly improving our artificial intelligence engine to create an infinite number of personalized workouts. The platform assesses the member's fitness level and recommends workouts based on their abilities, available time, mood and workout experiences they prefer. And continues to learn and adapt removing the guest work from achieving a productive and satisfying work out. Our members receive voice coached individualized workout similar to one-on-one personal training, trainer-led workouts and integration with other fitness apps. We continue to provide our members with the ability to stream entertainment, while working out and even while being coached. We have integrated Netflix, Hulu, Amazon Prime and Disney+ for use within our fitness experiences. Shortly, we'll be adding HBO Max. We are constantly serving up something fresh to our members be it new content or releases. This past quarter alone we added new adaptive AI-driven workouts, new Explore the World locations these immersive experiences now numbering over 100 locations are hugely popular with our members, especially on our treads. And we hear from our community that they are choosing Explore the World as a form of escapism during this time. New trainer-led videos. We continue to add more on machine workouts. And today, we announced a strategic partnership with FitOn, one of the fastest-growing premium fitness applications to bring hundreds of off-product workouts accessible for our JRNY members for no additional charge. This collaboration and integration is just one example of our commitment to creating unparalleled digital workout experiences for our growing JRNY membership base. Beginning this fall, JRNY members can seamlessly access and track FitOn workouts through their Bowflex connected equipment or the app. Users can search from a wide variety of FitOn's popular off-product workouts, including cardio, high-intensity interval training, yoga, stretch and pilates and choose various lengths ranging from three minutes to an hour at levels, as well as overlay JRNY radio to find a workout that matches their mood and location at any given moment. The first day our member gets their machine is not the best day and we will continue enhancing the platform in response to our members' feedback. It's important to acknowledge that while we're still in year one of our long-term transformation we've come a long way in a short period of time. I joined Nautilus almost exactly two years ago and I -- and as I reflect on those two years, I'm incredibly grateful and impressed by the work of our team, the turnaround we've achieved, and the profound growth we've driven. The old Nautilus was an equipment-only, ship it and forget it company supported by great brands, but had missed important trends, such as Connected Fitness had an aging and unfocused portfolio of products and marketing that badly needed refreshment. It also lacked clear strategy and proper investment back into the business and it started to become eclipsed by new entrants. And it suffered a multi-year revenue decline culminating in 2019's 22% drop in significant operating losses. Pre-pandemic, we instituted a number of operational improvements launched new Connected Fitness bikes with a strong value proposition and began to see significant change in our business trajectory. During COVID, we not only leveraged our at-home tailwinds to deliver five consecutive quarters of strong profitable growth. We expanded our supply chain to meet demand launched new connected cardio products, targeted new consumer segments with our products and marketing and relaunched JRNY. We also launched North Star, our long-term vision and strategic plan to give us the direction we needed. We've become more -- a more on-trend and more digitally focused connected fitness company that partners with our customers on an ongoing basis to achieve their goals. The new Nautilus is still that veteran fitness company backed by strong brands. But we now have a clear strategy in place and are taking the right steps to reinvest in our business to fund the long-term success, and ensure that we are a digitally focused, consumer-focused leader. As I close my remarks, I'm delighted, that we are further ahead on our long-term transformation than I could have dreamed, when I joined Nautilus. We've made a lot of progress and find ourselves in a much stronger foundation from which, to fulfill our vision. We are making deliberate and choicefull decisions to invest in the long-term vision. We will remain steadfast in our commitment to continue to build the new Nautilus, for the long-term one with more predictable growth and higher profitability that will generate attractive long-term returns. I'll now turn it over to Aina, who will give us more detail on our first quarter financials and our guidance for the rest of the year. Aina?
Aina Konold: Thanks Jim. Good afternoon everyone. A year ago we were reporting the results of the first full quarter that benefited from the COVID tailwind. And I remember, thinking, next year will be a tough comp. So I'm really pleased with, how we delivered against this quarter. I'll begin with total company P&L results for fiscal Q1 2022, which is the three months ending June, with comparisons to the same period last year. Net sales were $185 million up 62%, or up 74% excluding Octane. Gross profit, was $56 million up 17%. Gross margins were 30.1%, down from 41.5% last year. As Jim noted earlier, nearly all of the margin pressure is coming from temporary macro events that are affecting not just our industry, but many others as well. Let me now walk you through the drivers of the change in gross margins. Approximately six points of the decline are due to increased landed product costs. Spot buying of components, due to the global shortage, inflationary increases in commodities, elevated logistics costs and lastly FX, partially offset by price increases that we implemented in the quarter. Another three points are due to channel mix. Direct was, 34% of total sales this year versus 44% last year. Another point is due to outbound freight for our, Direct segment. Because of limitations imposed by FedEx, we had to shift some shipments to more expensive carriers. Another part of the decline is due to a write-off related to the strategic decision to discontinue certain SKUs. Given the global component shortage, we decided to accelerate the North Star plant to discontinue Nautilus-branded products and non-core Schwinn products. And we are focusing the limited chips we have in our larger screen-embedded products given strong consumer preference for these larger screens. The rest of the decline is driven by higher COGs, in JRNY. Turning now to operating expenses, as a reminder, last year we booked $29 million loss in disposal group related to Octane. The next few lines in the P&L have been adjusted to remove the impact of this charge. Please see our press release for a reconciliation of these non-GAAP numbers to our reported results. Adjusted operating expenses were $38 million or 20% of net sales, versus last year's $25 million or 22% of sales. Selling and marketing was $21 million or 12% of sales, compared to $12 million or 11% of sales last year, driven by increased media spend. Direct media spend was $8 million this year versus $2 million last year. And we invested an incremental $3 million in brand media, as part of our North Star strategy. G&A was $12 million and leveraged by two points to 6% of sales this year, compared to $9 million or 8% of sales last year. The increase was driven by greater investment in IT to support JRNY. R&D was $5 million or 3% of sales, compared to $4 million or 3% of sales last year, driven by increased development costs related to JRNY. Adjusted operating income was $18 million or 10% versus last year's $22 million or 19%. As planned, operating margins declined versus last year due to lower gross margins, the return to normalized levels of brand marketing and North Star investments. We came in better than the high end of our guidance due to stronger sales and the shift of some brand marketing from the first quarter ending June into the second quarter ending September. We want to give more visibility to the impact of North Star investments in our P&L and the continued strength of our underlying business. On slide 14 in the deck that accompanies our presentation of approving additional detail on how our investments in JRNY and in brand marketing affected this quarter's operating margins. While we are investing in the other three pillars, brand marketing and JRNY costs are discrete and the most significant. JRNY investments were about $5 million this quarter versus $1 million last year and brand marketing was about $3 million versus zero last year. Together these investments reduced our operating margins by about four percentage points. Adjusted income from continuing ops was $14 million or $0.43 per diluted share, compared to last year's income of $17 million or $0.56 per diluted share. Adjusted EBITDA from continuing ops was $21 million, compared to $26 million last year. I'll now turn to performance by segment. Direct sales were up $26 million to $63 million. We're really pleased that we were able to clear a lot of our backlog in the quarter. It's now only $3 million versus $27 million last quarter. Most of the backlog was in strength, which is why strength grew 559%, driven by our popular SelectTech weights and Bowflex home gyms. Cardio declined 31%, driven primarily by last year's sales of now discontinued products like the TreadClimber and non-connected Schwinn bikes. We're also selling less IC bikes on our direct channel as our retailers are now in stock. Strong growth in our new embedded screen products are partially offsetting these declines. When we exclude the revenue associated with the backlog, it appears that Direct is returning to more seasonal patterns. As a reminder the quarter ending June and the quarter ending September are typically the lower volume quarters for Direct. Gross profit was $25 million versus $28 million last year and gross margins were 39% compared to 55% last year. Segment contribution was $7 million versus last year's $17 million, driven by lower gross profit and the return to normalized advertising spend. Turning now to retail segment results. Net sales were $120 million, up 91% versus last year and up 121% excluding Octane. This was our retail segment's highest ever quarterly sales. International sales grew 70% or 102% excluding Octane. Strength was up 119% and cardio was up 83%. The retail's backlog at the end of the quarter was $142 million, compared to $179 million last quarter. We disclosed retail customers whose sales are greater than 10% of total company net sales. This quarter Amazon was 18% of total sales and Best Buy was 17%. Gross profit grew 59% to $30 million versus $19 million last year and gross margins were 25% versus 30% last year. Segment contribution was $22 million, an increase of $10 million versus last year. The improvement was primarily driven by higher gross profit and expense leverage. Turning now to the balance sheet as of June 30, 2021 with a comparison to balances as of March 31. Cash and investments were $83 million. Debt levels rated mostly flat at $13 million and we had $54 million available for borrowing on our credit line. Trade receivables were $98 million with the increase primarily due to the timing of customer payments on higher sales. Trade payables were $115 million with the increase primarily due to the timing of payments and higher inventory. Inventory was $111 million. More than 60% of our inventory as of 6/30 was in transit. Given the continued disruption in global logistics we made a strategic decision to bring inventory in earlier to be in a better position to meet upcoming peak fitness seasonal demand. At the end of the quarter we had $175 million of open POs compared to $216 million at 3/31. Turning now to our expectations for the second quarter of fiscal 2022. Our industry has experienced massive changes in the last 15 months. Our revenue for the next few quarters will be compared to record results due to the pandemic's effect on our net sales last year. To gauge continued progress against our expanded addressable market, we'll be measuring our business versus LY and versus LLY for the next few quarters. Demand growth for Direct in Q1 and in the first month of Q2 have been trending to more typical seasonality patterns. Now that we successfully cleared the backlog, we expect direct sales in Q2 to be lower than Q1. Thus we expect total company net sales for the second quarter of fiscal 2022 to be between $145 million and $155 million which equates to a two year CAGR of 53% to 59%. As mentioned earlier, similar to many companies we're experiencing unprecedented price increases in components, commodities and transportation with some costs up six times to seven times higher than last year. FX continues to be a headwind and regrettably we expect these macro pressures to worsen in Q2. Despite rising spot buy prices, we've been aggressive in securing the chips we need for our embedded screen products and are pulling all levers to overcome transportation challenges and ensure that we have access to the inventory we need to be competitive during the upcoming peak selling season. As we did in Q1, we'll work to deliver operational improvements to allow us to continue investing in North Star despite the hurdle of these temporary macro factors. We are in a period of investment and the preliminary results we've seen from our Q1 spend gives us confidence to move forward with our Q2 planned investments. We expect brand marketing to be between $5 million and $6 million versus $3 million last quarter and zero last year. We expect JRNY investment to be between $5.5 million to $6.5 million versus $5 million last quarter and $1 million last year. As our member count grows and more people interact with our platform, we're learning which features matter most and where we have room for improvement. Our investments in Q2 will further improve platform functionality, increasing the variety of adaptive workouts, improving the way members can manage their accounts and continuing to provide fresh content like the ones from our new partner FitOn. These North Star investments which are squarely aligned with achieving our year end goal of 250,000 JRNY members are expected to dilute operating margins by between seven percentage to eight percentage points. When coupled with external macro pressures on gross margin, we expect Q2 operating margins to be in the low single-digits. Turning now to our expectations for the back half of the year. We'll continue to optimize our base business to allow us to keep investing in North Star on a pay-as-we-go basis. While we would welcome some relief and supply chain costs we are assuming Q3 and Q4 margins will continue to be pressured by external factors. Though no one knows when the pressure will ease, it's reasonable to expect that over time these price increases will stabilize and eventually return to pre-pandemic levels. Until we see a reversal of the historical high input costs for our products and in the global transportation environment, we expect operating margins to be in the low to mid-single digits for the back half of the year. We are reiterating our full year CapEx guidance of between $12 million and $14 million, with the majority of the spend being focused on JRNY. We're also reiterating our expectation of reaching 250,000 JRNY members by the end of this fiscal year. Our conviction in pursuing our North Star strategy has never been stronger. The growth we're seeing in JRNY memberships and their increasing engagement with the platform confirm our expectations of generating outsized returns on our investments. We believe we must continue to stay the course in our transformation, as it will ultimately yield higher quality recurring revenue and long-term profitable growth. These near-term external pressures on gross margin are temporary and we believe that they are not impacting or delaying our expectations of achieving sustainable operating margins of 15% plus by year-end 2016, as we recognize the long-term benefits of our transformational investments. Now I'd like to turn the call back over to Jim for his final comments.
Jim Barr: Thank you, Aina. I'm pleased with our fiscal year results with our first fiscal quarter results and the progress we're making towards our North Star strategy. Our investments are on track. And even with our ramp-up of investments and inflationary costs, we delivered nearly 10% operating margins and our company is better positioned than it has ever been in its 35-year history of being a public company. Our entire team understands North Star is the driving force of building long-term shareholder value and is focused each day on executing against the five pillars of North Star. Our transition is underway and our strategy is working, evidenced by continued revenue growth, customer growth and our JRNY membership growth over the past few quarters, even as gyms had reopened. We are providing differentiated winning fitness experiences that are driven by consumer insights and combining equipment and digital experiences that make us partner with our members on their journey to achieving long-term success. In closing, let me again thank all of our incredible employees as well as our partners for delivering yet another record-breaking quarter and making such notable progress towards the new Nautilus. I'd now like to open it up for questions. Operator?
Operator: Thank you. At this time, we will conduct a question-and-answer session. [Operator Instructions] Our first question comes from Mike Swartz with Truist Securities. Please proceed.
Operator: Our next question comes from Steve Dyer with Craig-Hallum. Please proceed.
Operator: Our next question comes from Sharon Zackfia with William Blair. Please proceed.
Operator: [Operator Instructions] Our next question comes from Mark Smith with Lake Street Capital. Please proceed.
Operator: Our next question comes from George Kelly with ROTH Capital. Please proceed.
Operator: Thank you. At this time I would like to turn the call back over to Mr. Jim Barr for closing comments.
Jim Barr: Well, thank you everyone. I appreciate all your time today and I look forward to -- thanks for your support of Nautilus. We look forward to talking to you again in the second quarter of the fiscal year earnings call in November. I hope you have a great rest of the day onwards and upwards.
Operator: Thank you. This does conclude today's teleconference. You may disconnect your lines at this time and thank you for your participation and have a great day.
