Stewart Information Services Q1 2023 Earnings Call Transcript

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Provided by Quartr
April 27, 2023

Key Takeaways

  • Stewart reported a Q1 net loss of $8 million (or $0.30 per share), with adjusted net loss of $7 million, on total revenues of $524 million down 37% year-over-year due to the lowest closed order volumes in over 20 years.
  • The company executed significant cost-management actions in late 2022 and Q1 2023 while preserving about $18–20 million of discretionary investments in technology, integrations and customer experience to drive long-term efficiency and margin gains.
  • Title segment pretax income swung from an $81 million gain (11% margin) in Q1 2022 to a pretax loss of $1 million (1% margin), with domestic commercial revenues down 42% (fee per file from $12.7 K to $8.3 K) and residential revenues down 32% despite a 30% increase in fee per file.
  • Open orders declined 37% and closed orders 45% in Q1, driven by high mortgage rates, low inventory and affordability headwinds; modest improvement is expected in Q2 but the challenging real estate environment is likely to persist into H2 2023.
  • Stewart reaffirmed its long-term goal of achieving high single to low double-digit margins over the cycle by scaling in attractive markets, expanding its agency technology platform, opportunistic acquisitions and improving escrow interest income yields.
AI Generated. May Contain Errors.
Earnings Conference Call
Stewart Information Services Q1 2023
00:00 / 00:00

There are 6 speakers on the call.

Operator

Hello, and thank you for joining the Stewart Information Services First Quarter 2023 Earnings Call. At this time, all participants are in a listen only mode. Later, you will have the opportunity to ask questions during the question and answer session. Instructions will be given at that time. Please note, today's call is being recorded.

Operator

It is now my pleasure to turn today's call over to your Brian Glaze, Chief Accounting Officer. Please go ahead.

Speaker 1

Thank you for joining us today for Stewart's Q1 2023 earnings conference call. We will be discussing results that were released Joining me today are CEO, Fred Eppinger and CFO, David Heisey. To listen online, please go to the stuart.com website Access belief for this conference call. This conference call may contain forward looking statements that involve a number of risks and uncertainties. Please refer to the company's press release and other filings with the SEC for a discussion of the risks and uncertainties that could cause our actual results to differ materially.

Speaker 1

During our call, we will discuss some non GAAP measures. For a reconciliation of these non GAAP measures, please refer to the appendix in today's earnings release, which is available on our website at stuart.com. Let me now turn the call over to Bruce Krause.

Speaker 2

Thank you for joining us Today for Stewart's Q1 2023 earnings conference call. David will review the quarterly financial results in a minute, but before that, I would operating performance to better position ourselves on our journey to becoming the premier title services company. The long term goal remains to Create a strong and resilient business that can thrive through all real estate cycles and economic conditions. We focus on improving margins, growth and resiliency by improving our In challenging markets like we are currently in, It is often difficult to advance long term goals. However, I am pleased with our progress towards improving our long term performance as we balance investments with the need to manage expense As we discussed before, we anticipated the Q1 to be our most challenging.

Speaker 2

We took significant actions to manage costs during the second half of twenty twenty two and again in the Q1 of twenty twenty three. We have been careful not to take actions that we felt would threaten our competitive position in long term value creating opportunities. We believe this is a And the right answer to get us through this period is to continue to invest in our people and remain focused on long term improvement plan And managed through a couple of challenging quarters, which is what we are doing. Early in the Q1, interest rates ticked Down fairly significantly, which resulted in an increase in open orders. However, order volumes slowed again when rates quickly reversed again in February, peaking in mid March.

Speaker 2

These challenging market dynamics, along with the impact of seasonality, led us to our lowest quarter closed order volumes in over 20 years and resulted in an overall loss for the quarter. As we moved into the 2nd quarter, interest rates moderated slightly but remained elevated. We expect this difficult environment will modestly improve in the 2nd quarter, but the challenging environment will continue into the second half of 'twenty three, And we will continue to manage our business with a careful balance of cost discipline and investments in skills and capabilities that we expect will be the best position for us for the long term. Although interest rates have declined in the early second quarter, interest Great, cloned inventory and housing affordability remain hindgences to any quick return to a normal real estate market. We remain focused on our long term strategies, enhancing our operating model, investments in technology, enhanced customer experience and improved efficiency of our operations in building scale in targeted areas.

Speaker 2

While we took additional expense actions this quarter, we recognize that these strategic investments This will cause our cost ratios to remain elevated in this market. We believe that the long term investments coupled with the thoughtful near term expense management We'll improve our structure and financial performance in the long term. In our direct operations, we are making progress on our strategy to grow scale in attractive markets. Even during this challenging market, we have continued to evaluate a select number of opportunities to increase our scale and footprint. Given the market uncertainty, we will make Very thoughtful decisions around deployment of capital.

Speaker 2

Positioning our commercial operations for growth across all We believe our focus will create long term growth in the commercial markets, although we recognize changing financial markets may create headwinds in the In our agency business, we have made excellent progress on our deployment of technology provide greater connectivity, ease of use and risk reduction for our agent partners. As we move through 'twenty three, our platform of services for agents is as Stronger as ever been, and we've begun to see meaningful share growth in our target markets. On the topic of technology, we continue to invest significantly in We've already made significant progress improving customer experience across all channels and rolling out our agency technology platform which significantly In addition, we have made significant progress integrating completed acquisitions into our production of other systems, which improves our customer experience as well as the overall operating efficiencies that we've been building on for the past several years. The remaining integrations will be an important focus We continue our current strong financial position while investing opportunistically during this market remains a top Financially, our long term goals remain to generate high single, low double digit margins over the cycle. We plan to building an improved competitive position and being more efficient and having a disciplined operating model that functions well through all real estate cycles.

Speaker 2

We have exercised growing scale in attractive markets across all business and we have made significant progress in improving the customer experience in all channels. While we are encouraged by our improvements in all our 4 critical fronts, talent, technology, customer experience In our financial model, we recognize work remains and our journey is not complete. However, we have seen Investments with a practical balance between an operating discipline to the current short term market challenges and strengthening Steward for the long term growth and performance. The Shaw Financial Planning team best positioned us to take advantage of the opportunities that this cycle will provide. I also would like to restate my positive long Our retail market has the ability to become the premier title services company.

Speaker 2

A tremendous thank you to our associates and all their hard work And to our customers for their continued loyalty and support. David will now update everyone on our results. Good morning, everyone, and thank you, Fred. First, I would also like to thank our associates for their amazing service and our customers As Fred noted, the Q1 saw a continuation of a difficult real estate market and poor consumer sentiment. Low residential inventory, high mortgage rates, lower commercial real estate activity and tough economic conditions All contributed to this situation.

Speaker 2

Yesterday, Stewart reported a net loss of $8,000,000 or $0.30 per diluted share On total revenues of $524,000,000 After adjusting for net realized and unrealized gains and losses, the adjusted first quarter Net loss was $7,000,000 or $0.25 per diluted share compared to a net income of $56,000,000 in the Q1 of 2022. The lower results for the Q1 were primarily driven by significantly lower revenues caused by volume decline by lower Home sales and refinances. Total title revenues in the Q1 decreased 265,000,000 37%, resulting in the title segment's pretax loss of approximately 1,000,000 And other items as an independent say of our press release, the segment's pretax income was $4,000,000 or 1% margin compared to $81,000,000 or 11% margin in 2022. In our direct title business, Domestic commercial revenues decreased $24,000,000 or 42%, primarily due to lower transaction volume and size. Average commercial fee per file was approximately $8,300 for the Q1 compared to $12,700 for the prior year quarter.

Speaker 2

Domestic residential revenues were down $70,000,000 or 32% as a result of significantly lower purchase and refinancing transactions. However, residential fee per file was approximately 3,400, which was 30% higher from last year due to higher purchase mix. Total international revenues decreased $16,000,000 or 40%, primarily due to lower transaction volumes in our Canadian operations. Total open and closed orders declined by 30 7% and 45%, respectively, in the Q1 compared to last year. In line with our direct Auto revenues, 1st quarter revenues from our agency operations decreased $155,000,000 or 38% compared to last year.

Speaker 2

The average agency remittance rate decreased to 17.4% compared to 18.1% primarily as a result of geographic In regard to title losses, total title loss expense in the Q1 decreased $12,000,000 or 40%, primarily driven by lower title revenues. As a percentage of title revenues, the title loss expense was 3.9 of title revenues. For the Real Estate Solutions segment, pre tax income decreased to $1,400,000 For the Q1 from $7,000,000 last year, primarily as a result of 30% lower revenues driven by lower transaction volume. 1st quarter pre tax margin was 2.2% compared to 7.6% last year After adjusting for purchase intangible amortization, the adjusted pretax margin was 11.5% compared to 14.8% last year. The segment's total operating expenses in the quarter decreased 26%, primarily due to lower costs related to revenues and lower incentive compensation.

Speaker 2

Consolidated employee costs as a percentage of Operating revenues increased to 33% compared to 24% in last year's quarter, primarily due to lower operating revenues in 2023. Other operating expenses as a percent of operating revenues were 23%, which was comparable to last year. On other matters, our financial position remains strong to support our customers, employees and the real estate market. At March 31, 2023, our total cash and investments were approximately $340,000,000 Total stockholders' equity attributable to Steward at the end of the quarter was approximately $1,350,000,000 and our book value per share was $50 Lastly, cash used in operations was $51,000,000 compared to net Cash provided by operations of $35,000,000 last year, primarily driven by the first quarter's net loss. We are always grateful for our customers and associates.

Speaker 2

We advocate for our labor and safety and prosperity, remain confident in our support of real estate markets. I'll now turn the call back over to the operator for questions.

Operator

Thank you. We will take our first question from Bose George with KBW. Please go ahead.

Speaker 2

Good morning, Bose. Hey, guys.

Speaker 3

Good morning. Actually, I wanted to ask about the margin. It might be a tough question, but just given the tough The challenging backdrop on both residential and commercial and assuming that persists for much of this year, what can we think about in terms of the margins the business can generate?

Speaker 2

Yes. I'm still convinced that as we look out in the next 6 to 8 quarters we're going up averaging kind of that high single digit double digit. I do think the question is kind of how it evolves this year. And I think we all have a view that it's going to improve material into the second half of the year. I think if you think about it now, I would say over the last 6 weeks, I think it's going to be a more moderate improvement in the second What's interesting for us is that closures were down 50% in January, 40 I think in February and then 4 in March, we made money in March.

Speaker 2

And so I think we're a much better company. I think we can manage And I think margins will improve dramatically to the year. I just think there'll be one moderate improvement in the 2nd quarter than maybe we thought 6 weeks ago because of the volumes. But again, if you look at last year, when we had a tough Q4, we ended at the 8%. I think we'll be a little less than that This year, if the back half improves, but I think it's got we have a lot of leverage here.

Speaker 2

But one of the things is we have Capacity in the system. And so as the volume comes in, we will be adding a lot of resource, right? So we have a lot of leverage where we are and the portfolio is a lot better. And because I look at it historically, we're kind of where we are, and I think we're bouncing off the bottom now and we're poised to do all that as for the rest

Speaker 3

Okay, that's great. That's very helpful. Thanks. And then just on the Real Estate Solutions segment, what's a good way to think about the run rate there? How much of that is transaction dependent versus not?

Speaker 2

Yes. Hey, Buzz, it's David. It's pretty transaction dependent. If you think about the mix of businesses, we've got the PropStream business versus the subscription business. So that's Not as transaction dependent, although people come in and out of that business depending on what's happening in the market.

Speaker 2

So that's less transaction dependent. But the other businesses, appraisal credit, those are transaction Action dependent. And so that was what you really saw in this quarter in some of those businesses transactions hit pretty hard. We have had some pretty good success in the credit business with differentiating in the market. And I think in general that business is doing well relative to the market.

Speaker 2

We're participating in the Appraisal Monetization Program, 1 of the 10 or so folks that were selected for that. So those are the kinds of things that will really help that business So it will be durable and better than some as the market improves. That's a way to maybe think about the puts and takes. So I'd say a good amount, over half is transaction dependent. And then you've got some stuff that's less transaction dependent.

Speaker 3

Okay. That's helpful. And then just the increase in that segment over last quarter, was that just sort of some of the acquisitions kicking in?

Speaker 2

Well, we did have the small account check acquisition in the Q1. We had a nominal benefit from that, but we did also have some Customer wins and so I think it was a combination of those. Yes. We've had some good momentum in a couple of those businesses around That actually helps lenders save money in the mortgage process and so we're actually get a little bit of growth Happening in a couple of those businesses right now.

Speaker 3

Okay, great. Thanks a lot.

Operator

And we will take our next question from John Campbell with Stephens Inc. Please go ahead.

Speaker 4

Hey, guys. Good morning. Good morning. Good morning, John. Hey, going back to the question and this is for Fred or maybe David here.

Speaker 4

But Fred, do you talk to the leverage the model or you don't think you need to add much additional expense as the revenue rebuilds. Just trying to get a Better grip on those incrementals. It would be helpful if you guys maybe provide the all in fixed cost level as it stands right now or Maybe just talk broadly to the mix of fixed first variable cost now and maybe how you expect that to shift from here?

Speaker 2

Yes, Jim. Well, obviously, we have strict fixed costs, right, that are in the 20% Yes, sort of 20% to 36%, then you've got sort of the infamous sort of 40% to 50%, 70% variable And then we have the 30 to 40 of true variable and the challenge is always managing the study variable. Exactly. So what I would say, John, is that personnel wise, right, if you're not 50% or you can't cut 50% of your resource personnel, right? And So you're going to be really careful about how you're managing your resource and protect the capabilities of the institution.

Speaker 2

So what I would say is that we've been very We've done a lot of actions. But the way I think about it is we have excess capacity in that semi variable component That we've retained to take advantage of the market as it comes back. And so therefore, what you see is and Notorious in this business, right? And on the way up, your margin is higher, right? Because you're managing Kind of that semi variable, to Dave's point, in a fixed way, and that will increase.

Speaker 2

And then at some point, you hit in overtime what we did in 'twenty one. And if you don't have resources, It really gets exaggerated as far as your margin. So again, the way I look at it is that we're bouncing off the bottom You've done a very good job. I really applaud our team for being creative across the board and being thoughtful about expenses in every dimension. And as we look forward, that incremental revenue helps us tremendously on margin.

Speaker 2

I just think it's going to be a tad slower than we thought before. In the 2nd quarter, what you're seeing is, while the tenure is down, that's spread widened and the darn inventory has been a little bit It's kind of unfreeze over time. I'm still pretty encouraged By the end of the year, like especially in the next quarter, it was a transition period. And again, I'll reiterate what I said. We were down 40% In order count in March, and we made some money, right?

Speaker 2

This company historically would have never been able to do that. This company for 100 years, we never made money in the first So we have been fortunate enough to do that in the last 3 years. And you look at our portfolio and how we manage ourselves, I think we have a lot of leverage on the way out here. We just got to keep managing ourselves carefully, right? It's a challenge market.

Speaker 4

Makes sense. That's really good color. I appreciate that. And then on commercial, obviously, a lot of uncertainty out there. I think investor attention is really shifting towards commercial, obviously.

Speaker 4

If you guys can maybe talk to the order pipeline, what you guys are seeing, I saw March, the open order is down 40%, Kind of what you're seeing if you've got any insights into April? And then if you could just talk broadly to the mix in the fee per file, maybe what you're expecting around fee per file, there's going to be continued pressure there You close out in 2Q?

Speaker 2

Go ahead, David. Yes, John. I mean, it's I think what you're seeing is not inconsistent in our Look, it's not inconsistent with what you're seeing in the market generally. You've got offices obviously challenged, although some markets not Challenges, I think the major metro offices tend to the major metros tend to be a little more challenged primarily because they have still more work from home. And so we haven't seen like in New York and places like that, the Vabra transactions come back and you're seeing that in the lower fee per I think as you get into some of the smaller markets, it's not as bad of a story on office, although they are there.

Speaker 2

You have You don't see what's going to happen with all the regional banks because they've been a big credit provider of that sector. We saw a lot of Energy deals at the end of the year, I think there's still a lot of activity there and we'll probably see some of those maturely important to you over the And then it's sort of a mixed bag. I mean you're seeing decent stuff in retail, Multifamily had been really strong. It's slipping a little bit, but generally stronger than the rest. And Yes, industrial is back off a little bit, right, because it just isn't as much activity as it was during the pandemic, but still generally strong.

Speaker 2

So I think it's the combination of those things and then what's happening in the capital markets and then people trying to adjust The cap rate changes in the life and valuation that's causing that slowing. The one that there is a One of the positive things, deals are mainly getting pushed not canceled. And so we just have to see how that all develops. And so hopefully As there's more clarity on valuation and capital and financing, those will actually close, right? And that will maybe There's not been a better outcome, but should that situation not change, that is what we'll consider to be challenged.

Speaker 2

Yes. So I think we're I don't think It's like the red market. I think it's again, we're planning on it being down a little bit. We were fortunate enough to gain Last year in commercial, we've done some good progress. Our energy practice is as busy as it's ever been.

Speaker 2

It's a little bit choppy and lumpy because of when the closings are. So one of the interesting things we have is we have probably A higher portfolio in our centralized commercial of smaller deals. And I think the uncertainty around regional banks is a little bit of pause In some of that market, and so there is a little bit, I think, kicking out of some of that. So we kind of think we're going to have this downturn is going to be We're here for a while and we'll see I think the back half of the year some better results, but it's interesting for us. We are really busy in a couple of these segments As busy as we've ever been.

Speaker 2

And so it's interesting to me, I feel pretty good about the business by the end of the year and towards the end of the year. But it is kind of a very uncertain, all the stuff coming on with the banks that we see this week is a it makes all that stuff a little bit uncertain. But you also, John, after thinking about it in the dimensions, it's not only sector specific, but it's type of activity. So new developments, Sales and then refinances, right? And you do have that $1,400,000,000,000 maturity ladder mainly this year and next year.

Speaker 2

That's going to provide some support to commercial. And then it's just a question of what happens With that, right, you have a lot of restructures, you have some defaults. As it looks like now with all the REITs that everybody reporting, Even though people might be increasing reserves, a lot of those loans are still for 4x, Which could be positive because it might mean you can actually refinance those and have to restructure the fall.

Speaker 4

Yes, that's super helpful. That's great insights. I appreciate that guys. Last one for me, just kind of a housekeeping question. But David, on the other orders, I know M and A is certainly influencing that, but you've had a pretty big step up there.

Speaker 4

If you could maybe talk To the seasonality of those other orders as well as what that kind of average fee profile is?

Speaker 2

Well, others primarily are reverse On basis through FMC. And yes, I mean that's going to approximate more, not exactly because the transactions are a It's a little bit smaller, but it's going to be closer to a purchase transaction than a refinance transaction.

Speaker 4

Okay. And then and that's from a fee per file standpoint and seasonality standpoint?

Speaker 2

Well, it's not as seasonal, right, because it's You can do that if you have equity in your home, it's more a function of getting a hold of a customer and closing the loan. So it's not as seasonal. In markets like this where you have a lot of built in equity is actually a good market. It's just that market has been changing a lot with some of the Originators being sold, repositioned, that kind of thing. You've also got new originators coming in.

Speaker 2

So I think it's more a function on the volume side of what's Happening with the originators that it is the opportunity from an equity and an age perspective. Okay, makes sense. Thanks guys. Thanks,

Operator

We will take our next question from Geoffrey Dunn with Dowling and Partners. Please go ahead.

Speaker 4

Good morning, Jeff. Thanks. Good morning.

Speaker 5

So I'm not sure if I'm going to ask this right, but from a commercial market, obviously, we're going through A big downturn cycle here. But with what's going on with office space, do you have concerns that there's any kind of secular shift happening? And I ask that more because of your mention about investing in commercial talent. Is your commercial talent, for example, focused on certain sectors and you could have made an investment And then some of you specialize in office and now that's not necessarily the right investment. Is that something we have to worry about if office doesn't come back or is your Talent more flexible across the various sectors that you cite?

Speaker 2

It's a good question because it is actually more flexible. And for us, it's very geographically. Jeff, one of the things that this company was historically is we were very skewed to New York on a commercial side, and we didn't have the breadth geographically. And so it actually is diversifying away from office in some ways or office like developments. And so I feel really good about it.

Speaker 2

In fact, we did some energy focused acquisition because it's kind of one of our Underwriting capabilities, it's obviously because of what's happening. There's some opportunity there. But it's been very much geographic. And obviously, there's some obvious places, Whether it's industrial or the warehouse or the data center stuff, there's some natural places that we focused on given what the trends were. And so I feel pretty good about what we've done.

Speaker 2

I would say the way I think about it, we primarily were very weak in certain geographies And our coverage, and growth markets that were important to cover. And that's how we thought about it. So I actually think we're pretty darn well The hardest thing since the pandemic, everybody expected it. I mean, again, this isn't something new. The other thing, the secondary city versus Primary City, in my view was also something that kind of you kind of knew when you anticipated as you thought about staffing One of the interesting things about us is we've always had a great reputation from an underlying point of view.

Speaker 2

The issue is because of our uncertainty of being for 3 years ago and the notion of our capital we had a lot less capital back then. We weren't a relevant third player. We were relevant, That's one way to say it. We're now very relevant. The question is, do we have the right capabilities in the right markets To tax the business.

Speaker 2

And by the way, I will also say that's true in the direct offices at the low end of commercial, where we didn't have as many people dedicated to that Segment as we need to have and will have going forward because that's going to be a vibrant segment for most look at all of our secondary cities, It's still the most powerful thing. So again, I think we've been thoughtful about this, I mean, I'm not worried about necessarily the office The retail has been held up a little bit more than expected. Retail was the other one that I think everybody anticipated was you weren't going to log into retail. And so we were pretty thoughtful about how we thought about adding resources.

Speaker 5

Right. And then you've mentioned a few times balancing expense Management with longer term investments, but how long can you sustain that balance? You could paint a scenario that maybe mortgage rates start loosening up, but if the consumer starts running into economic pressure, The estimates for originations this year, next year could still prove optimistic and it looks like the spring selling season is starting off soft. At what point do you have to start cutting muscle? Or do you just kind of bear down and endure it?

Speaker 2

Yes. I feel again, I do feel like we're bouncing off the bottom. It's a great question. So what a couple of things I'll refer to, I have about $18,000,000 to $20,000,000 that I identify As discretionary investments in long term stuff for the year. It's about 5 quarters.

Speaker 2

So I could have made a little bit of money this We're close. And we've got this part of kind of the data management stuff we're doing. We're doing some we kind of Work on kind of centralization and we've got some stuff we're doing on balancing where we do our search work and the cost of delivery of search work. And if I look at those initiatives, it will give you probably a couple, I believe, a couple of hundred basis points of improvement And margin over the next 18 to 24 months. And they're discretionary.

Speaker 2

And but we were relevant to them. I think the right thing to do. In In case you could characterize them as we're catching up to our competition, and that's what I was referring to both discretionary. There's another way to think about it, which is we have taken we've taken as much action as anybody that we compete against. The issue is my view is that I don't think there's a lot of great alternatives to go further.

Speaker 2

So I think there's always good hygiene gas and as things shift and Commercial gets weaker than that. There's some things we could do on a targeted basis. But we've done kind of what I feel is And it would be muffled. So I think we went a lot further down. Again, the market is going to be down 50% Continuously, you got to rethink that.

Speaker 2

The whole industry is going to have to think that. So I don't again, we're a little weak because of the seasonality of us More so than others. But we I think we've managed our expenses well. I think we're in a good place to actually have increasing margin through the rest of the year. So I feel okay with that.

Speaker 2

The other point I would make is, I mentioned in the last call, one place I feel like we just haven't done enough yet Is our interest income on escrow. And when we first started the journey, we looked at getting a bank And as we go short, money was like a quarter point. So nobody was interested in deposits. We are working hard at creating partnerships with a couple of banks To make sure that we're strapping on our couple $1,000,000,000 of escrow some interest return, which again Changes our margin at this level of volume. And so I think we can do get that done by the end of the year and it kind of helps our profile Relatively materially.

Speaker 2

And so that's the one lever kind of I believe we need Aggressively active that we have. As far as the portfolio stuff, one of the other questions today was our data business has been growing And that's a more stable earnings at a low volume like this. And so I think we're doing some things on the offensive It will enhance our margins if the market stayed at this level. So I actually think in most all scenarios, we're going to enhance margins So I don't I feel pretty good about where we are. But again, it's something we work at pretty hard.

Speaker 2

And I wanted to mention the 'twenty because It's an explicit decision to be made. I think it's the right decision made at the IRR Act is going to be tremendous because if you approve it, I think somebody asked that on the previous call, the problem with that improvement is we don't have volume. We don't get the full benefit of those improvements in efficiency, We'll get to a level of volume soon here that those will be more transparent. So I feel like they're worth making.

Speaker 5

All right. Thanks. That's really good color.

Speaker 2

Thank you.

Operator

And it appears that there are no further questions at this time. I'll turn the call back over to the management for closing remarks.

Speaker 2

I want to thank everybody for joining us for this quarter's call. Thank you so much for your attention.

Operator

Thank you for your participation. You may disconnect at any time.

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