Q4 2023 National Health Investors Inc Earnings Call
Participants
Dana Hambly; Director of IR; National Health Investors, Inc
Eric Mendelsohn; President, CEO & Director; National Health Investors, Inc
Kevin Pascoe; Executive VP & CIO; National Health Investors, Inc
John Spaid; Executive VP of Finance, CFO & Treasure; National Health Investors, Inc
Richard Anderson; Analyst; Wedbush Securities Inc
Tayo Okusanya; Analyst; Deutsche Bank
Juan Sanabria; Analyst; BMO Capital Markets
Austin Wurschmidt; Analyst; KeyBanc Capital Markets Inc
Presentation
Operator
Greetings, and welcome to the NHI. Fourth Quarter 2023 earnings call. At the start of the presentation, all lines will be in a listen only mode. Afterwards, we will conduct a question and answer session at that time. If you have a question, please press the one followed by the four on your telephone. If at any time during the conference you need to reach an operator, please press star zero. As reminder, today's call is being recorded Wednesday, February 21st, 2024.
I would now like to turn the conference over to Dana Hambly. Please go ahead.
Dana Hambly
Thank you, and welcome to the National Health Investors conference call to review results for the fourth quarter of 2023. On the call today are Eric Mendelsohn, President and CEO, Kevin Pascoe, Chief Investment Officer, John spade, Chief Financial Officer, and David Travis, Chief Accounting Officer.
The results as well as notice of the accessibility of this conference call were released after the market closed yesterday in a press release. That's been covered by the financial media. Any statements in this conference call which are not historical facts are forward-looking. Nhi cautions investors that any forward-looking statements may involve risks or uncertainties and are not guarantees of future performance of forward looking statements represent NHI's judgment as of the date of this conference call. Investors are urged to carefully review various disclosures made by NHI and its periodic reports filed with the Securities and Exchange Commission, including the risk factors and other information disclosed in NHI's Form 10 K for the year ended December 31st, 2023. Copies of these filings are available on the SEC's website at SEC.gov or on NHI's website at NHI. Reed.com. In addition, certain terms used in this call are non-GAAP financial measures, reconciliations of which are provided in NHI's earnings release and related tables and schedules, which have been furnished on Form eight K with the SEC listeners are encouraged to review those reconciliations provided in the earnings release together with all other information provided in that release.
I'll now turn the call over to our CEO, Eric Mendelson.
Eric Mendelsohn
Hello, and thanks to everyone for joining us today. We had another good quarter, capping a strong finish to the year with fourth results exceeding our expectations for the full year. Our Navy FFO, normalized FFO and FAD were above the midpoint of both our original and improved November guidance. Similar to the third quarter results, we experienced stable cash collections over $2 million in deferral repayments and no unexpected rent concessions. The triple-net senior housing portfolio consistent continues to benefit from improved industry fundamentals as EBITDARM coverage has now increased for seven consecutive periods with notable improvement at Deptford and our other need-driven operators. The senior housing portfolio or SHOP also contributed to the better than expected quarterly results, with NOI increasing 48% over the fourth quarter of 2022 to and over 24% sequentially. While Sharp is still a relatively small piece of our overall business, we're excited by improving trends and continue to believe in the significant upside potential that can drive our organic growth file profile. Specifically, we expect sharp NOI. to grow in a range of 25% to 30% in 2024.
From a portfolio repositioning standpoint, there is much less to discuss. This quarter. We structured the discovery leases, which were in line with the negotiations described in our November press release and guidance. We're making good progress on the Bickford rent reset with an expected increase in cash rent this year, and our other cash-basis tenants are current on their monthly base rent. We believe our portfolio is in much better shape and positions NHI for strong organic growth in the foreseeable future. We're also positioned for external growth with our fortress-like balance sheet. Our leverage profile is one of the lowest in the health care reads and in the top quartile when measured against all reads, given this low leverage, we have over $150 million in capacity to deploy capital without the need to issue equity while staying at or below five times net debt to adjusted EBITDA.
I commented during our last call that seller and lender expectations were still 100 basis points behind the changes in everyone's cost of capital and that they should be more realistic about the higher for longer rate environment. Higher for longer certainly appears to be the prevailing environment and we're starting to see sellers and borrowers adjust to this reality. There is an obvious cost of capital disparity with some of our larger peers, but they cannot be the solution for all of the growing illiquidity in the senior housing industry. We continue to advise customers to carefully choose a partner that will work with them towards their success in the long run. We believe this is starting to resonate, which makes us more optimistic.
Now about the pipeline so we expect our investment activity to accelerate this year.
Turning to our guidance for 2024, the midpoint of our FAD guidance represents 2.6% growth over 2023 with less noise from dispositions and rent concessions as well as more experience with SHOP, we believe we have much better visibility this year compared to the last two also our guidance does not include any investments which we expect will improve as conservative as the pipeline for accretive deals grows.
Our guidance represents the 3rd year since the pandemic where we have provided full year guidance and the 2024 result represents the 2nd year in a row where our FAD. achieved the top end of our guidance.
Before turning the call over to Kevin, I'll conclude by saying that we accomplished a great deal in 2023, and we're now in a strong position as we return to growth in 2024. Our multi-pronged organic growth opportunity is as strong as ever be it shop deferral repayments, rent resets or elevated escalators due to higher inflation. The investment and lending environments are very favorable for well-capitalized, low levered capital providers like NHI and in industry supply, demand balance seems timely to be tilting in our favor.
In sum, NHI is poised to capitalize on opportunities and what we expect to be many years of exceptional growth. I'll now turn the call to Kevin to provide more details on our operations. Kevin?
Kevin Pascoe
Your I'll concentrate my comments on investment and disposition activity as well as performance of our major asset classes and operators on the investment pipeline. And as Eric noted, we're starting to see more actionable activity we're hopeful that we're seeing the tip of the iceberg as volume of new inquiries has significantly increased in the last several months.
We're looking at deals across the continuum of senior housing and skilled nursing and across multiple products which have included loan lease and joint venture opportunities.
Initial yields, depending on the product, are in the high single digits to low double digits. In the case of new loan investments, our philosophy has always been to find a path to future real estate ownership, and that view has not changed.
Turning to asset management as previously disclosed, we sold three buildings in the fourth quarter for net proceeds of $5.4 million and $1.6 million in seller financing.
We currently have just one property held for sale. We continue to evaluate opportunities to improve our portfolio, which may include future asset sales, but we have no further material dispositions included in our 2024 outlook. As Eric noted, our fourth quarter results were very strong and largely mimicked. Our solid third quarter performance viewing the need-driven operators.
The positive coverage trends continued with EBITDA arm at 1.31 times, representing the seventh straight period of sequential growth. The coverage increase was driven in large part by Bickford at 1.51 times on a trailing 12 month basis, Bickford occupancy trends have been excellent. Fourth quarter average occupancy improved 100 basis points sequentially from the third quarter to 85.2%. While we typically expect some seasonal weakness in the first quarter. January average occupancy increased 70 basis points from December to 85.7%. This occupancy improvement comes after a resident rent increase of 6% in November.
With this resident rent increase, coupled with the occupancy gains, we expect that Bickford coverage continues to move higher if we've repaid approximately $1 million of their deferral balance in the fourth quarter.
This was their highest quarterly repayments, which reflects the portfolio strong underlying operating results as repayments are tied to revenue thresholds. Total cash rent from Bickford, including repayments, was approximately $33 million during 2023. As Eric mentioned, we are close to reaching an agreement with Bickford on terms of their leases, which are scheduled for reset on April first. As the discussions are ongoing, we won't comment further other than to reiterate that we believe cash rent, including repayments will be higher in 2024 for our other new driven tenants. Operating 37 properties continue to show improvement. Reported coverage at 1.13 times is the highest since the second quarter of 2020 and the eight straight period of sequential improvement for operators repaid approximately $1 million in debt for deferrals during the fourth quarter.
Our discretionary senior housing portfolio primarily includes our entrance fee portfolio, which has performed well above our expectations since then since the pandemic began. And that continues to be the case, coverage improved sequentially to 1.41 times from 1.38 times, driven by a nice uptick at SLC, our largest tenant on another solid quarter of entrance fee sales. Discretionary coverages, excluding SLC., which largely reflects the performance of our other entrance fee communities declined to 1.38 times from 1.5 times. This was due to uneven entry-fee sales at one well-capitalized tenant, but we're happy to see stronger fourth quarter sales, which is not yet reflected in the calculation. Smith and specialty hospital portfolio reported solid coverage of 2.74 times, which is improved sequentially from 2.62 times.
Lastly, in our SHOP portfolio, momentum continues to build throughout the portfolio with our partners, discovery and Merrill Gardens. Fourth quarter NOI increased 48.2% year over year to $2.9 million. Resident fees increased by 9.8% year over year on a 740 basis point increase in occupancy to 83.2%. Operating expenses increased just 2.2%, leading to a 580 basis points year over year. Margin improvement to 22.3%. As noted in our 2024 guidance, we forecast SHOP NOI growth in a range of 25% to 30%.
While we do not give quarterly guidance. We do expect the NOI cadence to move higher throughout the year. January is off to a good start as occupancy averaged 84.7%, up 30 basis points from December. A longer term view on this portfolio that it can generate in OI dollars in the high 10s. Margins in the mid 30% range remains unchanged.
I'll now turn the call over to John to discuss our financial results and guidance. John?
John Spaid
Thank you, Kevin, and hello, everyone. For the year ended December 31st, 2023, our net income namely FFO and normalized FFO per diluted common share were $3.13, $4.39 and $4.33 per share, respectively, which represents year over year improvements of 112%, 24% and 1% respectively. For the year ended December 31, our FAD was $187.8 million, down 6.6% year over year, but recall that during 2022 to recognize significant prior year holiday related revenues as a result of our settlement with Welltower As Eric mentioned, we're pleased to report that each of our pro forma metrics came in at the high end of our guidance. Net income for the fourth quarter and year ended December 31st when compared to our guidance reflects the fact that we did not close as expected on the sale of our one property and assets held for sale that did not record the expected gain. Our fourth quarter 2023 FAD was $47.3 million, which is a 5.9% increase compared to the fourth quarter of 2022 sequentially compared to the third quarter in 2023, FAD was down $825,000, but recall the third quarter saw discrete payments from two cash-basis tenants for amounts previously owed for prior quarters, but which were not recurring to the Q4. Our Q4 2023 metrics when compared to Q4 2022, saw further improvements to FAD payout and net debt to adjusted EBITDA ratios of 82.5% and 4.4 times compared to 87.3% and 4.7 times, respectively. For Q4 also saw a milestone where for the first time, since Q2 2021, we did not record any impairments. As Eric mentioned, the fourth quarter was sequentially the second quarter without any unexpected tenant concessions. In 2023, we repaid or retired well retired approximately $415 million in debt using proceeds from a new term loan and our revolver. We saw proceeds from loan repayments and dispositions of approximately $70 million and made acquisitions and loan investments of approximately $74 million during 2023. We did not issue any equity under our $500 million ATM program, more buyback any stock under our $160 million stock repurchase authority.
Last night, we issued our full year guidance for 2024 for our 2024 guidance for normalized FFO is in the range of $187.2 million to 189.7 million or a range of $4.31 to $4.37 per share. We are forecasting FAB to be in the range of $191.3 million to 194.1 million, representing year-over-year growth of 2.6% at the midpoint and 3.4% at the high point. As Eric mentioned, our guidance includes SHOP NOI growth of up to 3% year over year and no incremental new investments. While we are telling you that our guidance includes the collection and deferrals. Remember that the majority of deferred rent that we collect is attributable to Bickford. As Eric and Kevin mentioned, we are close to finalizing the step-up rent negotiations with Bickford, which will have an impact on the additional deferred rent we will be able to collect in 2024, but not on our estimate for the different NOI., which is included in our guidance. Our balance sheet continues to be a source of strength for us. And this year, our focus will be on our weighted average debt maturities, variable interest rate, debt levels and liquidity. At the end of January, we had $273 million outstanding on our $700 million revolver and only a single debt maturity this year for $75 million at the end of September. Deserve mention our leverage ratio continues to trend favorable ending 2023 at 4.4 times net debt to adjusted EBITDA at the end of January, we have ample liquidity of over $425 million in cash and revolver availability from the full $500 million available under our ATM program. Looking towards 2025, we have an additional $326 million in debt, maturing $200 million of this maturing debt is our term loan, which does have at NHI's option, the ability to extend the loan for up to one year at December 31st, the percentage of variable interest rate to our total debt was just under 39% and the next two years will retire an additional $201 million in fixed rate debt. Our strategy for this year will be to look at our debt options for improving our average debt maturities and for keeping our variable interest rate risk at comfortable levels at current interest rates our long-term interest rates are only 40 to 50 basis points higher than our variable interest rates. So we don't expect any meaningful impact to our 2024 guidance as a result of any new significant debt facility.
As we announced last night, our Board of Directors declared a $0.9 per share dividend for shareholders of record March 28th, 2024 and payable on May third, 2020 for our Board also reauthorized our $160 million stock repurchase plan, which is effective for one year. That concludes our prepared remarks. So once again, thank you for joining our call today. With that, operator, please open the lines for questions.
Question and Answer Session
Operator
Thank you. And if you would like to register a question, please press the one four on your telephone. You will hear a three-tone prompt to acknowledge your request. If your question has been answered and you would like to withdraw your registration, please press the one followed by the three. One moment please, for the first question. Our first question comes from Richard Anderson with Wedbush. Please proceed.
Richard Anderson
Good morning, everyone. So John, just if you could confirm for me. I asked this question probably every quarter and then I forget the answer on the deferral repayments. Is there a doubling up in 2024 where you didn't record it when you offered the deferral, but that you're getting kind of full payment plus deferral in 2024. Does that happen with Bickford or anybody else in your guidance.
John Spaid
So Hey, Rich, I'm doubling up. That's not the right word. I think what you're what you're telling what you're asking me is are we putting on our balance sheet some of the deferrals through GAAP revenues. And the answer to that question is yes. And so we mentioned in our press release that we had $2 million of deferral repayments in the fourth quarter and $5.7 million for the year. And so how does that work?
Right? So some of those deferrals that we mentioned, we do pull into our GAAP revenues and because that's part of the 842 determination. And so we tried to collect those as soon as possible. And when we do collect them, it all flows down into and shows up in FAD. But because of the straight-line component, it may not move FFO or net income. And so in the fourth quarter, that number was $700,000 was already in net income. And for the year it was $2.6 million. That's our I would call it accrual-based deferral recognition.
Richard Anderson
Okay. So there's no like no double doubling up is obviously not the word this is yes or right of a couple of buckets.
John Spaid
Okay. And. Yes, yes, we're trying to we're trying to we're trying to do a better job in the future, you know, keep this straight, knowing that everybody wants to understand how these deferrals might affect FFO as opposed to FAD. And so you know, everything ends up in FAD., but because we're recognizing the collection of these deferrals through GAAP revenues or straight-line revenues, even if we collect them early, you know that's not going to move FFO or net income.
Richard Anderson
Okay, got you. Thanks, Eric. Obviously great results in the SHOP portfolio. I'm wondering how this informs you in terms of a pipeline of converting existing triple net senior housing assets into shop. If that's on your radar going from a 4.5% percent of your portfolio being shopped to what degree are you enticed by seeing that number go up substantially either organically within the portfolio or through acquisitions?
Eric Mendelsohn
Thanks, Rich, for the compliment, we are definitely gratified to see our SHOP portfolio perk up. We've been patient. As you know, it took us a long time to get our CapEx program finished, but now that it's done, the results are are encouraging. Some, but one quarter or two quarters does not a trend make. So I still feel and this is in our guidance. I still feel like this is a product that has more room to run. And I'm sure it's definitely catching our Board's attention, how well it's doing. So you're right, my goal and Kevin's goal is to add to the shop portfolio, either through acquisitions or conversions, and there's certainly a lot of opportunity there and a lot of people interested in that.
Richard Anderson
And last question for me, I think Johnny said the Bickford reset on April that will have an impact on deferral collections. Are you saying that the new rent have sort of you sort of the future deferrals that are still on that on the table will just become higher rent from Bickford and that's how you'll sort of account for that. Is that is that the right way to think about it?
John Spaid
Right. We're telling you that we're in negotiations with Bickford. And the strategy here is to continue to show improvement in Bickford NOI, which as they do allows us through either a stepped-up rent for the collection of deferrals or improve our NOINFAD., right. What I can't tell you yet is what the what the what the split is going to end up being just yet some and you can understand why, right? And so I can't really signal to you because the majority of our deferral collections in 2024 will be coming from Bickford. I can't really signal to you the component of that deferral, the component of our guidance for all of our IT. That's in our guidance right now.
Richard Anderson
I'm sorry, I assembled. And I would hopefully I mean, I would just call it, I would just caution against eating into that coverage improvement. I think the market probably values coverage more than they value rent growth in triple net. So but you probably know that already it's just the commentary from the cheap seats.
John Spaid
But yes, as you know, and one of the metrics that we present to you is our coverage ratio. That coverage ratio excludes the repayment of deferrals two by the way.
Richard Anderson
Right, thanks.
Operator
Our next question comes from Tayo Okusanya with Deutsche Bank. Please proceed.
Tayo Okusanya
Yes, good morning. Um, along the lines of rent resets, I believe there was also a rent reset or related to discovery in 2024. Could you could you talk a little bit about how's that is always not included in guidance.
Kevin Pascoe
Quartile is included in guidance. We went we talked a great deal about that in our November call and I think we mentioned in several places that the outcome of that renegotiation was in line with what we said. So we we said that there was a reduction of rent for two of the leases. So that hasn't changed. The amount is came out as expected and it is in our guidance. And so there's really nothing else to report.
Tayo Okusanya
Okay. That's helpful. And then, Eric, your comments just on acquisitions again, it really does sound like, you know, it could be a really big year in that regard. Could you talk a little bit about, you know, how much you're seeing in terms of what just the acquisition pipeline could look like? And could you give us a sense of how much of that is actual fee, simple transactions versus more kind of structured finance or mortgage loan transactions?
Eric Mendelsohn
Hey, Tayo, you're absolutely right. A lot of it is structured finance, which we're willing to do at the right price. And if we have line of sight to an acquisition, as I like to call it, loan to own, but we're seeing a very robust market right now. I think the message that banks are not lending deals are falling apart, sellers are getting more rational in their pricing expectations. And I think brokers are getting through to potential sellers that there's still a market, but it's not the market of 2020. So it's a different market now at a higher cap rate with more difficult financing options.
Tayo Okusanya
Got you. Okay. That's helpful. Thank you.
Operator
Our next question comes from Juan Sanabria with BMO Capital Markets. Please proceed.
Juan Sanabria
Hi, good morning. Tom, just hoping you could maybe talk a little bit about some of the piece parts in the SHOP guidance, whether it be occupancy, RevPAR or expense growth or margins underlying your same-store NOI of 25% to 30% growth, please.
Kevin Pascoe
For a one, Kevin, the headline for sure, is occupancy. As we've talked about before, we've been using incentives to make sure that we're getting the occupancy where we want. That's had a very positive effect over 2023. And that will continue to be the strategy for 2024.
Being mindful also is on the expense side, the operating partners have done a good job of holding those in line year over year, but we do expect some inflationary type increases. So again, the biggest piece is really just occupancy. Once we see occupancy, we'll see we would expect anyway in July to follow. But that typically is a little lag, which is also why I think you see And oh, I better in the fourth quarter than because of occupancy increased throughout the year. And that's kind of how we built our forecast for this year is continued usage of those incentives get the occupancy where we want to go and look at our business update, and you can see where we see the Knick map markets versus our our buildings. So there's still plenty of room to grow from an occupancy perspective. So again, I think that's absolutely number one, you'll see rate follow once we get occupancy where we wanted to be, but that's going to be a little bit it's kind of a Phase two.
Juan Sanabria
Okay, great. Thank you. And then just on your enthusiasm for the investment opportunities, it sounds like you have maybe some more loans opportunities, but just curious if the enthusiasm includes the opportunities to do more and shop in terms of new investments and if you do, in fact, have the green light from the border, Nana sounds like no, but just wanted to confirm and in, I guess, bigger picture, the market seems to have moved away from triple-net. I mean, how do you think about the investment pipeline going forwards and the opportunities and triple net versus shop is just the size of the opportunity set perhaps is the best way to talk about things.
Eric Mendelsohn
Hey, Juan, this is Eric. It's certainly noticed by our Board that shop has popped and we're getting a signal from the Board that they would be open to more shop or idea. So we're excited about that. The arm, as I was saying earlier, you know, the structured finance opportunities are really a result of the bank shutting down, so there's no shortage of that. But Kevin, likes his real estate and the best way to get to real estate is either doing a joint venture in a shop or doing a triple-net lease. And look, I would agree with you that triple-net leases are fewer and far between. But I would also say that it's really open the eyes of some customers that may be having a loan that's three to five years and term isn't the best thing when it comes due and you're not able to find a new loan to replace that you're kind of in a pickle and that that has driven people to the conclusion that maybe a 10 or 15 year lease isn't the worst thing in the world and they should consider it. So it's a funny market out there, but I think it's one that we can do a lot of business in.
Juan Sanabria
And just the last question on Discovery, I get the point that you've talked about at length on the last call, but I guess it is the restructuring. I don't think it is in the fourth quarter run rate or how should we adjust the fourth quarter run rate for the change in the discovery lease?
John Spaid
That's a good question. It is not in the fourth quarter run rate. The best I can do with you on that right now is just simply say it's properly reflected in guidance, you know them.
Yes. And let me let me think about where we can through our filings. Maybe give you a little more help on that.
Juan Sanabria
Thank you.
Operator
As a reminder, to register a question, please press the one four on your telephone. Our next question comes from Austin, where strip was Schmitt from KeyBanc Capital Markets. Please proceed.
Austin Wurschmidt
Great, thank you. And just going back to Dick for a moment, I believe you guys were entitled to an 8% yield on your original investment or around $4 million of incremental annual rent. So with $1 million of deferral repayments in the fourth quarter, you're kind of essentially there. But is it fair to say that the market rent reset could be less than 8%, but you'll be above that if you include the amount of deferrals on top of the market rent reset.
Kevin Pascoe
Payoffs yes, that I mean that's a fair assumption. When you cobbled the two together, it would be in excess forward isn't being mindful of is into what Richard mentioned earlier of what absolute coverages within the enterprise and really within our portfolio and then looking at the level of repayment, they can be able to have to maintain in addition to maintaining our buildings so we're just kind of making sure we're looking at all the pieces and make sure that they remain healthy. We've done a lot of work to get them to this point we don't want to mess that up. So again, it should be mindful, but I think you're right. When you look at repayments in addition to base rent, you should be in excess of that number, the 8% number.
Austin Wurschmidt
Got it. And then I guess just taking it a little bit further. I mean, some what's assumed in guidance around Bickford is the increase in deferrals just in totality versus 2023? Or is the increase versus the 4Q run rate? Because you referenced there some increase in deferrals that for a big component of that. I'm just trying to understand how significant of an increase in deferral repayments you're assuming in guidance.
John Spaid
Well, we are intentionally not tying up what's going on there because of the negotiation with Bickford. And Tom, what I would say is we do see future growth in the Bickford NOI for 2024. And so the prior quarter run rate we hope will you'll see over time will improve. And now the way that we divide the split between that NOI between repayment of deferrals and the step-up rent we have yet to tell you we'll probably be able to tell you that number with our first quarter conference call in May, which will give you a lot more guidance. But again, like I said, our guidance has or has our expectations already in it.
Austin Wurschmidt
Yes. Got it. Understood.
And just quickly on the SHOP portfolio, can you provide a little bit of detail or additional detail around the concessions you're offering on average to drive occupancy? And just curious how sticky those residents are. I've been at this.
Kevin Pascoe
Well, to the latter part of the question we've been monitoring length of stay. I would tell you it's down a little bit from where we saw when holiday operated the portfolio, but it's increased over the last few quarters. So we're we seen positive improvement on the length of stay in the portfolio. So happy with where it sits overall could be a little bit better, but it's it's within reason in terms of what we see with competitors in terms of concessions, usually at some form of discount on the first month's rent track. There is some pricing mechanism than the tool bucket that the operators have by and large, we're trying to make the concessions more upfront that we were taking a little bit of hit on move in, but the rents would then go to more of a market rate after the 1st month after a shorter period of time. So we generally see about two thirds of them giving very rough numbers, but policy you have two thirds of the incentive be front end loaded. And then in some cases, there's a little bit longer-term incentive where it would stick around in the net against our future income for a period of time, but it's again going to be more. We're looking for those stickier residents, ones that are we can get more of the market rate rents and just using those early dollars to begin to move in.
Austin Wurschmidt
That's helpful. Thanks for that.
Operator
Yes, are there questions at this?
Eric Mendelsohn
Thanks, everyone. We'll look forward to seeing you at Nedcor on our roadshow or conference.
Operator
That does conclude the conference call for today. We thank you for your participation and ask that you please disconnect your line. Have a great day, everyone.
