Prepared remarks
Good afternoon, ladies and gentlemen. Thank you for standing by. Welcome to the LightPath Technologies First Quarter Fiscal 2025 Earnings Conference Call. During today’s presentation, all parties will be in a listen-only mode. Following the presentation, the conference will be opened for questions. This conference is being recorded today, November 7, 2024, and the earnings press release accompanying this conference call was issued after the market closed today. On our call today is LightPath's CEO, Sam Rubin; and CFO, Al Miranda. I'd like to remind you that during the course of this conference call, the company will be making forward-looking statements that are based on current expectations that involve various risks and uncertainties as discussed in its periodic SEC filings. Although the company believes that the assumptions underlying these statements are reasonable, any of them can prove to be inaccurate, and there could be no assurance that the projected results would be realized.
In addition, references may be made to certain financial measures that are not in accordance with generally accepted accounting principles or GAAP. We refer to these as non-GAAP financial measures. Please refer to our SEC reports in certain of our press releases, which include reconciliations of non-GAAP financial measures and associated disclaimers. Sam will begin today's call with an overview of the business and recent developments for the company. I will then review financial results for the quarter and the full year. Following our prepared remarks, there will be a formal question-and-answer session. I would now like to turn the conference over to Sam Rubin. Sam, the floor is yours.
Thank you, operator. Good afternoon, everyone, and welcome to LightPath Technologies' first quarter fiscal 2025 financial results conference call. The first quarter of 2025 demonstrated our continued transformation from a pure component supplier to a systems provider, delivering new products, contracts, and ongoing growth driven by these incremental product lines. Just over three years ago, we set a fresh course with a new strategic direction, taking us from being a pure component supplier to a solutions provider. Since we've laid out three pillars of growth, upon which our business is built. The first is our proprietary cameras and optics. Second, our solutions for government and defense; and the third on new commercial applications. For those not familiar with our history, I will provide a brief overview. Prior to this shift, LightPath was, for the greater part of 30 years, an optical component provider.
What many years ago was a unique technology, molded optics has now become a crowded marketplace going through classic transformation and commoditization. As a result, LightPath's core business was eroding, with unit prices decreasing, along with margins and profits. In 2021, we set a course on a new strategic direction, leveraging some of our key technologies to deliver subsystems and system-level solutions instead of simply components, which drive higher average selling prices and ultimately gross profit dollars. This transformation has been very successful for us, and in this quarter, we reported that 30% of our revenue came from those activities. This type of revenue was much less significant for us before we began this path. Through our investment in differentiated technology, we have positioned ourselves as a leader in the field of infrared optics with an exclusive license from the government to commercialize new materials developed at the Naval Research Lab, as well as our partnership with the Department of Defense, Defense Logistics Agency, with the goal of replacing germanium in DoD applications.
We are not only the go-to partner for anyone looking to phase out germanium, but we have also earned ourselves a seat at the table at some of the most important discussions and projects in today's defense world. Four years ago, we could only have dreamed of being in such a position. Naturally, since these are defense programs we're talking about, we're a bit limited in what we can share, but we will try to share as much as possible. Recently, the DoD, via Defense Logistics Agency, Strategic Materials, has awarded us Phase 2 funding to support the qualification of additional new Black Diamond chalcogenide glass as a substitute for germanium. Phase 1 was a significant success, resulting in the qualification of several new proprietary BlackDiamond materials. These materials are now designed into multiple programs of record and demonstrate significant additional value beyond simply replacing germanium.
In Phase 2, we'll continue working with DLA to qualify additional BlackDiamond glasses to be included in DoD systems. The validation this represents cannot be understated as it directly translates to new defense programs that rely on our glass, for which we are the exclusive supplier of record. During the quarter, we also received an initial development contract from a new European defense customer for the use of BlackDiamond glass in optical systems. Additionally, we received a follow-on order from a European defense customer for infrared assemblies for use in FPV, that is first-person view drone application. These orders are enabled by and validate our recent efforts to obtain a European defense license and build capabilities at our Latvia facility, as well as highlight our growing recognition as a trusted supplier within NATO-aligned regions. As a reminder, more than 30% of our sales come from defense, most of those in the U.S. But obtaining the European defense license now opens the door for us to grow our defense business in Europe as well.
And those two recent wins are leading indicators to the success of this strategy. We expect to see significant growth coming from the European defense market, as some customers may potentially turn into 10% customers. In addition to our investment in materials and differentiating technologies, we have also invested in the development of our camera technologies. Just over a year ago, we completed the acquisition of Visimid Technologies, integrating their expertise with our proprietary materials to develop advanced thermal cameras and imaging systems. We have built a portfolio of unique thermal cameras that have created a strong entry point for us in the system-level product and enable us to carve out a market share in a market estimated to be $9 billion of total addressable market and growing rapidly. Our efforts in the camera business, our first pillar of growth, are focused around LightPath's unique camera solutions.
This started with the introduction of MANTIS, an innovative broadband or multispectral infrared camera that is the first of its kind, enabled purely by our unique materials from MRF. MANTIS opened doors with several high-profile customers, establishing our reputation for producing cameras that are not only groundbreaking in design but also practical for applications in harsh and high-sensitivity environments. With a price tag of $30,000, we're positioned as industry leaders from a cost-to-performance perspective. This is significant for the future growth of the company as selling hundreds of cameras at $30,000 each has a completely different impact on our topline growth than selling just the lenses that go into those cameras, which can cost about as little as a cup of coffee, which used to be our business model prior to this transformation. In addition, we recently launched our new Optical Gas Imaging Camera platform to detect fugitive gas emissions for the oil and gas industry.
The new OGI camera is specialized technology using infrared cameras to detect and visualize gas emissions such as methane in industrial settings. OGI cameras can visualize gases that are invisible to the naked eye by detecting the infrared energy absorbed or emitted by those gases. This topic is of extreme importance to the oil and gas industry, both in the U.S. and Europe, following new regulations curbing those emissions and imposing high penalties on operators. LightPath's purpose-built OGI camera leverages a non-germanium lens to improve upon current technologies by offering a cost-effective, higher sensitivity, and ultimately more effective solution. This OGI technology applies to other sectors as well, where we see the opportunity to launch additional incremental products, leveraging our expertise all without incurring significant development expenses. On the government and defense side of the business, our second pillar, we've seen traction pick up significantly.
Similar to the materials technology differentiators that already landed us one program of record, our technology differentiators have landed us the Lockheed Martin Missile program. Under this program, we are developing a new camera system for Lockheed Martin that will be part of a missile system. Due to pressing needs from the U.S. Army, the customer, the program is now on a very accelerated timeline. Though it started only a year ago, we have already achieved airworthy qualification of our subsystem and can begin shipping units for flight tests, which the team is currently working on. The Lockheed Martin program is potentially transformative for LightPath. Not only is it exactly the type of business we were targeting in our new strategy, but the size of this opportunity can completely transform us. If Lockheed Martin wins against Raytheon, which they are competing against, we could expect to see revenues of between $50 million to $100 million a year once in full production.
Though we are still in development, the progress of this project is so rapid that Lockheed and the customer are already looking to start setting up for low-rate initial production next year, which is the last step before full production. For a company of our size with around $35 million in revenue, a contract like this could completely transform us. Although there is a possibility that Lockheed will not win against Raytheon, we know that the technology we've developed is so transformative and important that the same customer is already integrating it into at least two additional programs. I'll now turn to our third pillar of growth, which is new commercial applications such as automotive. As those who follow us know, LightPath has been working with several Tier 1 and Tier 2 automotive OEMs to develop and qualify thermal imaging solutions for use in Advanced Driver-Assistance Systems. As per a new mandate set by the National Highway Traffic Safety Administration by 2029, all new cars should include an emergency braking system that can identify pedestrians in pitch-dark conditions from a certain distance.
To achieve that, it appears that thermal imaging is going to be adopted into every new car, which means a significant addressable market opportunity. Ahead of those upcoming catalysts, we begin to strengthen our operational capabilities to support future growth. Subsequent to the quarter end, we welcomed Steve Garcia as General Manager of our Orlando manufacturing facility. Steve brings extensive operational experience in high-growth environments, and he will play a vital role in scaling our production processes to meet the increasing demand for our products, particularly for defense and industrial applications. His addition enhances our ability to support large mission-critical programs while maintaining our commitment to quality and innovation. Now I'd like to turn the call over to our CFO, Al Miranda, to talk about our first quarter fiscal financial results. Al, please go ahead.
Thank you, Sam. I will keep my review to a very succinct highlight of the financials this quarter. As a reminder, much of the information we're discussing during this call was also included in our press release issued earlier today and will be included in the 10-Q for the period. I encourage you to visit our website to access these documents. Revenue for the first quarter of fiscal 2025 increased 4% to $8.4 million as compared to $8.1 million in the same year-ago quarter. Sales of infrared components were $2.6 million, or 31% of the company's consolidated revenue. Revenue from visible components was $3.3 million, or 39%. Revenue from assemblies and modules were $1.1 million, or 13%, and revenue from engineering services was $1.4 million, or 17%. Gross profit increased 22% to $2.8 million, or 34% of total revenues in the first quarter of 2025, as compared to $2.3 million, or 29% of total revenues in the same year-ago quarter.
The increase in gross margin as a percentage of revenue was primarily driven by a more favorable product mix weighted towards visible component sales and assemblies and modules, which typically have higher gross margins than infrared components. Operating expenses increased 23% to $3.3 million for the first quarter of fiscal 2025, as compared to approximately $2.7 million in the same year-ago quarter. The increase in operating expenses was primarily due to an increase in legal and consulting fees related to business development initiatives, as well as increases in sales and marketing spend to promote new products. Net loss in the first quarter of fiscal 2025 totaled $1.6 million, or $0.04 per basic and diluted share, as compared to $1.3 million, or $0.04 per basic and diluted share in the same year-ago quarter. The increase in net loss was primarily attributable to higher legal and consulting expenses related to business development initiatives.
EBITDA loss, a non-GAAP term for the quarter ended September 30, 2024, was approximately $0.5 million compared to a loss of $0.4 million for the same period of the prior fiscal year. The decrease in EBITDA in the first quarter of fiscal 2025 was primarily attributable to the previously mentioned additional legal and consulting expenses related to business development initiatives. Cash and cash equivalents as of September 30, 2024, totaled $4.3 million as compared to $3.5 million as of June 30, 2024. As of September 30, 2024, total debt stood at $3.9 million and backlog totaled $21 million. In closing, I view our performance in Q1 as a strong indicator of the solid footing and growth trajectory of LightPath. Financial results underscore the progress of our strategic investments with positive impacts on revenue, margin improvements, and a steady pipeline. We remain focused on executing this strategy with discipline and delivering value to our shareholders as we scale and grow. With that, I will turn the call back to Sam for some closing remarks.
Thank you, everyone, for taking the time today to attend our call. Looking ahead, we will continue to drive the future of imaging as seen through our proprietary BlackDiamond Optics, leveraging our clear advantage and capabilities compared to legacy germanium-based solutions. We've defined catalysts in the automotive, defense, and camera solutions markets. I have never been more confident in our path ahead. As we move into 2025, our team firmly believes that we are well-positioned to continue our transformation and build sustainable value for our shareholders over the long term. With that, I'll turn the call over to the operator to begin the questions-and-answer session.
Questions and answers
Ladies and gentlemen, we will now start the question-and-answer session. The first question comes from Jaeson Schmidt with Lake Street. Please proceed.
Hi, guys. Thanks for taking my questions, and congrats on the strong results. I want to start with the European market because it sounds like you guys are seeing some pretty significant traction there. Sam, I just want to clarify your comments on some of these customers maybe eclipsing that 10% threshold. Did you provide a timeline on when that could occur?
Yes. Good to hear from you, and thanks for the question. I think the European defense market, unfortunately, has timelines similar to the U.S. defense market, sometimes a little bit faster. When we talk, for example, about large programs, it's pretty much the same cycle as in the U.S., initial development, prototypes, low-rate initial production, and then into production, which can often be two years or so. Most of the time, we report on it when we're already well into the program. So naturally, we don't report when we just get an inquiry or start working on it. I'd say in most cases, it's up to one year from the moment we report it until we start seeing some real production-level orders. The FPV drone might be the exception there, where it's something not one of those large defense programs that has to go through enormous qualification. It's more of those technologies where armies around the world are trying to move faster and adopt commercial solutions to get them in faster. So the FPV might turn into revenue or is turning into revenue much faster.
Okay. Great. And is the sales team and sales channel in that market fully built out? Or do you still need some work there?
I'd say we have a pretty strong sales team there. Maybe there are some sales channels where in the defense part in certain countries, we need local partners. Even though the EU is the EU and spending within the EU and our defense license covers the entire EU, certain countries prefer more localized purchasing or want you to have a local partner. So there could be countries where we'll be signing up distributors, which could be outside the EU, such as Turkey and the UK, where we will need distributors just due to the way things are there.
Okay. That makes sense. And last one for me, and I'll jump back in the queue. Any update on how you're thinking about the timeline for the Lockheed decision?
No significant changes on our side. I mean, as we said, we received the Airworthy requalification, which we're very proud of, and I'm immensely proud of the team in Texas for everything they've done there. We're building flight-worthy units right now. The timeline is fluidic, but we're still hoping to get some indications around the coming September, October timeframe.
Your next question comes from Glenn Mattson with Ladenburg. Please go ahead.
Hi. Thanks for taking the question, and congrats on the results. The topline was a little better than I expected. Curious, as it comes to the camera business, the assemblies, and modules. In my projections, I have kind of a strong back half built on the sales funnel having grown from all these new products and efforts you're making. Is that still reasonable? Do you still feel that funnel is building and that you're seeing a good response from the customer set there?
Yes, definitely. I'd say the camera business can generally move faster and translate into revenue. A lot of it is from the industrial commercial space, so furnaces and high-temperature process monitoring. It's more driven by their budget cycles. We're at the end of the year now; there's end-of-year spending, but we suspect most of it is going into next year's budgets, which means from January to June, we'll be seeing a lot of those orders and deliveries. On the defense side of cameras, it has a faster cycle than some large defense programs, with the exception of the Lockheed project, which is a very customized long-term project. Even when providing camera safety drones, the turnaround cycles are very fast. The DoD is making tremendous efforts to adopt commercial technologies or dual-use technologies faster, and we're benefiting from that.
Great. And maybe I missed it on multiple calls, but in the past, you've mentioned another defense program that you're working on, I believe it's an Apache helicopter application. Is there an update there that you could share?
We're working on the initial prototypes with some small delays, but nothing major. I'd say the team is doing very well there. Unfortunately, no significant update.
Yes. And then I believe in the second quarter in a row, you mentioned two additional programs with Lockheed. Is there any color you can give further in terms of timeline?
These programs, we don’t have much information about them. We don’t always know the full details of the programs. But we know, with the same groups at Lockheed of Missile and Fire Control, they're earlier stage than the large missile program, and they will not be as high a volume as that. But they're moving along, and we feel confident that Lockheed is viewing that as the ultimate solution for those programs.
Great. Thank you. And last one for me. I know this is not really a fair question. I know it's been two days, but with the changing political landscape, the new administration might be tough on China, but maybe a little more friendly with Russia. They are two sources of germanium. Can you just talk about if there are any initial thoughts as to what it all means for you guys?
I don't expect that to impact the germanium part significantly. I mean, Russia is still likely to be sanctioned, and China will still try to use germanium as leverage in trading. I don't foresee significant changes there. We've proactively reduced our exposure to germanium by canceling a few multimillion-dollar orders about 1.5 years ago. So we already took actions toward that. I think, if anything, the results of that election might increase some defense spending around the world, and defense is close to going to be 50% of our business at some point. So that's probably good for us.
Great. Okay, thanks, Sam.
Thank you.
Next question comes from Scott Buck with H.C. Wainwright. Please go ahead.
Hi. Good afternoon, guys. Thanks for taking my questions. I think I saw you reached a qualification milestone with Lockheed in the quarter. Is there a revenue attached to that, that was in the $8.4 million?
Not specific to the qualification milestone. We recognized Lockheed revenue throughout the quarter. Did we have that? Sorry, we did have some revenues there. That shows in the Engineering Services Group. Yes, it's in engineering services, Scott.
It doesn't sound like it was a huge number.
It was about $1 million.
Okay. Great. Appreciate that. And then second, on some of these larger potential wins, and I'm thinking Lockheed specifically, but we can broaden it out. How should we think about the gross margin on those opportunities versus kind of today's consolidated margin?
So those are government programs and there's government accounting associated. So the government dictates the gross margin pretty much as I think it's something like 25%. But the baseline of 25% includes management fees, SG&A, and so on. So it's probably a bit too early to translate it into what it would look like in our gross margins. But my rough guess, Al, is somewhere between 30% to 40%.
Absolutely, definitely between 30% and 40%.
Okay. Perfect. Well, that’s it for me, guys. I appreciate the time. Thank you.
Thank you.
The next question comes from Brian Kinstlinger with Alliance Global Partners. Please go ahead.
Great. Thanks. I got a couple of questions. Did I hear correctly now that you've got multiple cameras, you think adoption begins to pick up and orders begin to pick up about 12 to 18 months from now? Is that how I understood your response to one of those questions?
No. I meant that in January of this year, on the commercial industrial side, when new budgets for those power plants and utilities come into effect on January 1, we know for a fact that we have quite a few customers that have budgeted our cameras into their next year, meaning calendar 2025. We expect over the next seven to eight months to start seeing a pickup in that.
Is there any way to quantify what that – I mean, is that 10% of revenue, do you think 20% of revenue? I mean how do you think given those ticket sizes? Is there any way to quantify it?
Yes. I'd say, if we look at the product groups of assemblies and engineering services sort of bundled together, that has gone up to about 30% of our revenue in this quarter. I could definitely see that going up to as much as 50% over the next few quarters. This is our future and where the growth is coming from by far.
And maybe I'm drawing a blank, but that large customer that has gone away for you for now, are they still evaluating BlackDiamond materials? And if so, is there a reasonable timeframe to expect adoption?
No, you're absolutely right. We haven't spoken about it in a while. I was at that customer a couple of weeks ago, and we were working out a plan with them on both getting BlackDiamond into their systems to replace germanium. They have not yet done that, as well as a few other long-term strategic things we're working on together. I'm very hopeful that this customer will come back, and we will win them back. It's a significant potential. As a reminder, that customer used to be anywhere between $4 million to $6 million a year for us.
But from your comments, you're not quite that confident yet. You're still working on trying to get that done.
There's quite a bit that needs to be done on their side as well. We're working closely together. For us, that's the most important part: it's a very collaborative effort.
And then how long do you expect Phase 2 of the testing? I think it's with DLA. How long do you see that lasting? And then is the next phase moving into production?
Well, production starts every time we qualify our material. BDNL4 was qualified and is in production. BDNL6 and 8, we actually have not formally announced them as qualified. But realistically, they are already embedded in a couple of programs of record. We just haven't announced that officially. From DLA's point of view, that qualification has finished. The next six glasses DLA is paying for the qualification. The project is defined to last up to 24 months, but we suspect it could be sooner than that.
Okay. Now backlog is relatively flat year-over-year. However, I get the sense from your and Al's comments that you're confident that you're going to begin to grow revenue a little faster. Is that because some of these orders don't flow through backlog and we might not see them? Just reconcile the flat backlog with the accelerated pace of growth, please.
Yes, definitely. You're correct. A lot of the camera business is what we call book and turn. We have subassemblies of them ready. We have modules, and we can turn a camera around and ship it within two to three weeks. With unit prices of $10,000 to $30,000 for the cameras, that can be significant in some of the book and turn. We’re looking at the backlog being flat year-over-year. Up until about a year ago, we had our sports gun site companies renewing between $4 million and $6 million every November. So we're flat without what used to be a $4 million to $6 million customer. So it is indeed growth in all the other businesses outside that customer.
Can you remind me when that customer last made that order so we can take a look from that?
About a year ago. I think about a year ago is when we canceled and did not renew it. The order fell off around that time.
So the flat backlog doesn't reflect either side probably of that order.
There was probably $1.5 billion left in there.
My last question is, as you look at the backlog, could you share some information on how much generally gets recognized in 12 months?
Most of the backlog ages out in 12 to 15 months. We don't have a lot, Brian, that goes past 15 months on the backlog.
Great. And in terms of the mix?
The mix is more heavily weighted towards the visible components and some of the visible infrared components, the component business, and some of the simple assemblies like doublets. For the bigger things like Sam is talking about, the cameras we will get at best a three-month order.
Great. Thanks so much, guys.
Your next question comes from Orin Hirschman with AIGH Investment Partners. Please go ahead.
Hi. Congratulations on the progress. I just want to hear more about the go-to-market for the industrial cameras and the timing, and if you've seen any early traction even if they're not huge dollars, but multiple orders?
Yes, definitely. The go-to-market strategy has changed or evolved roughly half a year ago with Jason Messerschmidt, who came from FLIR, who was in charge of all North American sales at FLIR, which is a significant background in the world of cameras. He has really developed a go-to-market strategy and team here. This included recruiting a couple of people from FLIR and other industrial applications, people who know the oil, gas, and other industrial environments inside out. In fact, we just finished today a one-day session on the go-to-market strategy for the next few weeks. Traction, because of that, is much faster than what we were used to. When we announce a product like the methane detection cameras that we announced three weeks ago, that is already after our team had been at customer sites testing and validating it. By the time we announce a new product in oil and gas, it has usually some customers behind it already.
Most of the time, scaling it up is much easier because those customers are typically distributors or integrators that then cover specific geographies or areas. For example, the first furnace cameras we shipped out were to an integrator in the Southeast that we know has quite a number of orders coming right as soon as their customers' capital budgets go into effect on January 1. So we're very optimistic about that. We're able to move into substantial revenue much faster when it comes to those cameras once we've already validated them at a customer.
Great. Thanks so much.
Thank you.
Next question comes from Gene Inger with ingerletter.com. Please go ahead.
Hi, Sam and Al, keeping up the good work. And of course, we're all looking forward to what happens with Lockheed in the next year or so. May I ask you guys, I don't know if you can say specifically if you're involved with the sustainment $200 million contract for Project Longbow, but you probably know what that is related to the Apache or AH-64. But that's also with Northrop Grumman, not Lockheed. Does that involve you guys?
Yes. First of all, for many of those programs, there's one lead prime, but then there could be multiple other subprimes. I can't comment specifically on this prime or that prime. I would say that every time there's a project that talks about modernization of an existing platform like Apache, you can assume that a big part of the modernization is upgrading the electro-optic systems. If you look at the DoD budget, the modernization of the Apache actually has a line item mentioning electro-optic systems. I'd leave it at that.
Well, I know Poland is buying 70 of them, and the Netherlands has decided to have this new fire control target acquisition radar system. So I was wondering if that provides incremental additional business for you guys, I hope that it does. And whether it does for Latvia or if this would be just Orlando-made materials?
So two parts to that: First of all, it will, but it will be long-term. When foreign customers get upgrades like this, they will typically get them well after the U.S. Therefore, if we were working on such a program, I’d say we would be providing it for at least five years to U.S. helicopters before it makes its way to any of the foreign customers, as friendly as they are.
The reason without time to be nosy, I had. I’m sorry I interrupted you. You are not finished. I’m sorry.
No, please. Go ahead.
Okay. I brought up helicopters, and I'm concerned that as we go into laser warfare and especially intercepting drones, that's going to become increasingly something that companies are looking at, although I don't know how they can move lasers because the drones and incoming missiles can be maneuvered, and typically a laser shoots in a straight line. But with that said, a helicopter is not a great platform in terms of it has vulnerability. I'm wondering whether your lenses and your glass can be coated to deflect or reflect laser and provide a countermeasure against laser beams.
I can't comment on a specific technology like that. I would say if our lenses or anything could deflect the laser, they would also deflect other parts of the light spectrum and therefore, could potentially increase the visibility of the helicopter to the user. So I'm not sure if that would happen specifically. But I just want to circle back to your second part: if we provide any systems that go into Apache and then get upgraded for Europe, they will still go through the U.S. They would always be built in the U.S. and shipped out to customers. That does not play a role in this.
Apologies if I got too detailed. And my final question would be regarding space, which you haven't mentioned. I've seen developments focused on collision avoidance of debris or satellites or defensive measures if one of our satellites is targeted to disrupt communications. You've acknowledged that you're involved in space communications, whether it's Starlink or someone else. I'm wondering whether the new approach of LiDAR in space to give proximity and better manage space involves you guys.
I'm not aware of us being directly involved in that. It’s very possible that through one of our LiDAR customers, we are. We work with multiple different companies that focus on LiDAR for automotive and other applications. So we might be indirectly involved in it, but I'm not familiar with that.
Anyway, I look forward to hopefully a successful year. Sam, you and Al, you've done a tremendous job of changing the direction of the company, and I welcome that.
Thank you, Gene.
Thank you, Gene.
There are no further questions. Please continue.
Thank you, operator, and thank you again to each of you for joining us on today's earnings conference call. We look forward to continuing to update you on our progress and great results, and we strive to deliver value to our valued shareholders. Thank you, and goodbye.
Ladies and gentlemen, this concludes today's conference call. Thank you for your participation. You may now disconnect.