WildBrain Ltd. (NASDAQ:WLDBF) Q1 2021 Results Earnings Conference Call November 11, 2020 10:00 AM ET
Nancy Chan-Palmateer – Director of Investor Relations
Eric Ellenbogen – Chief Executive Officer, Vice Chair
Josh Scherba – President
Aaron Ames – Chief Financial Officer
Conference Call Participants
Deepak Kaushal – Stifel
Tim Casey – BMO
Drew McReynolds – RBC
Jeff Fan – Scotiabank
Good morning and welcome to the WildBrain’s fiscal 2021 first quarter earnings call. All lines have been placed on mute to prevent any background noise. After the speakers’ remarks, there will be a question-and-answer session. [Operator Instructions].
I would now like to turn the call over to Nancy Chan-Palmateer, Director, Investor Relations at WildBrain. You may begin your conference.
Thank you operator and thank you everyone for joining us today. Speaking on the call today are Eric Ellenbogen, our CEO and Aaron Ames, our CFO and Josh Scherba, our President. Also with us and available during question-and-answer session is Danielle Neath, our EVP of Finance and Chief Accounting Officer.
First, we have some standard cautionary statements. The matters discussed on this call include forward-looking statements under applicable securities laws with respect to WildBrain including, but not limited to, statements regarding future deals and investments by the company, the impacts of COVID-19 on the company and its business, the business strategies and operational activities of the company, the markets and industries in which the company operates and the future financial and operating performance of the company.
Such statements are based on information currently available and are subject to a number of risks and uncertainties. Actual results or events in the future could differ materially and adversely from those described in the forward-looking statements as a result of various important factors, including the risk factors set out in the company’s most recent MD&A and Annual Information Form.
Please note that all currency numbers are in Canadian Dollars. For the question-and-answer session that will follow, we ask that each analyst keep to one question with one follow-up so that everyone has a chance to ask questions. If you would like to ask an additional question, please rejoin the queue. Please note that we are all in separate locations for the call today, so we do appreciate your patience if we encounter any lumpiness as we steer through the Q&A.
I will now turn hand call over to our CEO, Eric Ellenbogen.
Thank you Nancy. Good morning or good afternoon to everyone and thank you for joining us today. It’s only been a few weeks since our year-end call us. So I am going to focus today on new developments since the close of the quarter.
The most important news since September is our expanded partnership with Apple TV+ for Peanuts, which was announced on October 19. This is the largest content deal in our company’s history making Apple TV+ the new home for all of Peanuts content. This multiyear worldwide deal expands our pre-existing partnership with Apple TV+. And under this new agreement, we will be making significantly more new content for the platform, well beyond what was ordered under our 2018 agreement. Apple TV+ has also licensed the full library of our classic Peanuts content. And needless to say, this is a tremendous deal for our company.
Let me walk you through what this means for WildBrain. First, let’s look back at the original Apple deal we did in December 2018. We really couldn’t say much at the time about that deal but I can share more details now. Included in that first agreement were orders for season one of Snoopy in Space which was delivered to Apple TV+ last fall and has been one of the most popular series on the platform, so much so that Apple TV+ has ordered a second season which is now in production.
That original deal also included season one of the Snoopy show which Apple unveiled to audiences in a sneak peek last month. We are also in production with that show too which is slated to debut worldwide on Apple’s platform in February 2021. And the original deal also included orders for multiple new family specials to mark Mother’s Day, Earth Day, New Year’s Eve and Back to School and all of these specials are now also in production at our studio.
Let’s take a look at the expanded partnership which was just announced. It includes, first, more new original Peanuts series, introducing a whole new generation to Snoopy, Woodstock, Charlie Brown and the gang. Second, a number of additional new family specials beyond those already in production. Third, a new 70th anniversary Peanuts documentary which we are co-producing with Ron Howard’s Imagine Documentaries. And finally, other new large projects as well over the term of this expanded agreement.
In addition to this extensive slate of new content, Apple TV+ has also licensed our full library of classic Peanuts content, including the beloved Halloween, Thanksgiving and Christmas specials. These specials are some of the most popular TV shows ever made. They have consistently enjoyed strong ratings for 50 years. And we are thrilled that Apple is making them available for free viewing to everyone during the holiday season.
All of our Peanuts content will be available on Apple TV + through apps and websites worldwide on just about any web-enabled device including Apple iPhones and iPads as well as devices from other manufacturers such as smart TVs, computers, tablets and smart phones. Through Apple TV+, audiences around the world including most who have actually never seen Peanuts content on TV will be able to immerse themselves in our new shows and the classic specials whenever and wherever they like on any device.
The anticipated reach of this global deal is well beyond anything previously achieved. This partnership will significantly amplify exposure to the Peanuts brand for many years to come, which we firmly believe will drive significant growth for our global consumer products business. Peanuts is a top 10 character brand at retail where it enjoys success across virtually every product category. The franchise is now celebrating its 70th anniversary and has secured dozens of new consumer products licenses driven by this milestone. Many of these agreements were brokered by our wholly-owned licensing agency, WildBrain CPLG, exemplifying the collaboration we are implementing across our company.
As we reach new audiences and new generations of kids through Apple TV+, not only do we expect the existing Peanuts licensing business to grow, we also expect it to expand in underdeveloped merchandising categories, particularly in the kids demographic. The importance of this partnership for WildBrain cannot be overstated. It reflects a long term commitment for new Peanuts content from a leading global media platform. It also elevates our creative profile to an entirely new level. It secures our production pipeline for years to come providing visibility on our future earnings and will drive meaningful growth in our consumer-products business. And that’s just Peanuts. As we activate more and more brands from our deep IP portfolio, there will be lots more news to come.
I would like to now invite Josh Scherba, our President, to provide some color on the shifts we are seeing in content demand and how premium content deals such as this one play out in our earnings. Josh?
Thank you Eric. As we have discussed in previous calls, a priority for our content business over the last few years has been rebuilding our creative pipeline to align with an industry shift towards global deals for premium content. Our Apple TV+ partnership on Peanuts is a perfect example. The growth we have seen in our content business over the past two quarters reflects this dynamic as bigger projects such as the Peanuts content from the first Apple deal ramped up to full run rate.
This has also been creative magnet unlike any other company has ever seen. The prospect of working on an iconic animation property like Peanuts attract top talent to our studio, thereby establishing a virtuous cycle which will reignite other key IP from our vast portfolio of famous brands.
As Eric noted, this is just Peanuts. As we look across the rest of our portfolio and continue to activate the significant IP we have, we expect to layer on more and more large deals to meet the rising demand for premium content. These deals often incorporate library titles. We saw this with the Apple deal and similarly, when Netflix recently ordered a new original Johnny Test series. They also licensed worldwide rights to the show’s full back catalog. So not only are we reigniting key IP through premium original productions, we are often also able to license our library content to the same platforms, thereby driving overall larger overall deal value.
To better reflect these shifts, we have decided as of this quarter to combine reporting of production and distribution into one revenue line in our financial results. This consolidation reflects industry trends that we are seeing. It’s how we are managing our IP and it reflects the consolidated nature of the transactions we are entering into with global SVODs and other distribution channels. This is also in line with the integrated management of our business and reflects industry practice.
Premium content deals are the way forward for WildBrain. They are a trigger for reactivating IP in our 360-degreee strategy. As you have seen over the last year or so, while we are making fewer content announcements than we have in the past, the announcements we do make are highly meaningful to our production, distribution and consumer products businesses and to growing our earnings base.
With that, I will hand call back to Eric.
Thanks Josh. Turning now to our AVOD business. WildBrain Spark continues to have one of the largest and most engaged global audiences in the kids and family space with 62.4 billion minutes of videos watched this quarter, which was up 14% versus Q1 2020. The duration of use is also increasing which is a key attribute for monetization. On average, the duration of use on Spark are 15% longer than the average on YouTube in the kid genre. Each view on our platform averaged six minutes in Q1, up 27% from Q1 2020.
While COVID-19 and changes on YouTube have negatively impacted advertising sales in the short term, we are encouraged by sequential growth in revenue for Q1, which is up 37% compared to Q4. In fact, we have seen improvement every month starting with July and continuing into October.
Overall, the trends we highlighted last quarter have continued and there are positive indicators across the advertising industry. The digital advertising market started to pick up in Q1, particularly as COVID lockdowns eased and we came out of the summer and started to run up to Christmas. In September, we saw encouraging uplift in advertising demand which is leading to gradual improvements in advertising rates.
On direct ad sales, we have been investing in building out our market presence, particularly in the U.S. with plans to build further. This has led to ad campaigns being sold and run on both sides of the Atlantic. Our premium brands and content had global scale with proprietary content solutions and data-led planning is resonating very well with ad buyers.
Finally, as you know, in Q4 last fiscal, we secured a CAD25 million growth fund to fund strategic accretive transactions across the company, with special focus on our AVOD business. Now we have an update. I can tell you that we have now earmarked substantially all of the initial funds for deals and investments that are currently under negotiation and we anticipate closing many of these transactions in the coming quarters.
And with that, I will hand the call over to Aaron.
Thank you Eric. During Q1, we continued to execute on our disciplined approach to content investments while managing working capital and controlling our costs. We also paid down CAD5 million on our revolving credit facility in the first quarter and the outstanding balance of CAD5 million in October, subsequent to quarter-end. While we expect our total net leverage ratio to increase moderately in Q2 20 21 due to timing, based on our current expectations of how the pandemic will play out coupled with the enhanced visibility we now have around our revenue, earnings and content pipeline over the next 18-plus months, we expect our total net leverage ratio to be comfortably in the midst four level or below by the end of fiscal 2022.
As Josh mentioned, we have and will continue locking in a content pipeline with premium projects that give us great visibility into future revenue and earnings. It’s important to also understand, however, that it takes time for this book business to appear in our results. For example, the expanded Apple deal will begin contributing to our EBITDA in 2022 when these new projects ramp up. Revenue from these shows are recognized on a percentage of completion basis over the life of the production. One other thing I wanted to highlight with respect to the Apple TV+ agreement is that the library deal for the classic Peanuts content was signed after quarter-end. So this recognized in our second quarter results.
To better reflect the characteristics of these premium deals and aligned with how we are monetizing our content, we have reclassified the financial reporting of our revenues as follows. For reporting purposes, our content business segment now comprises the following three revenue lines. First, production and distribution. Second, consumer products including WildBrain CPLG. Third, WildBrain Spark. Our Canadian linear TV business has been renamed Canadian Television Broadcasting and continues to be reported separately.
Turning now to our Q1 results. Revenue in Q1 was CAD95.5 million, compared with CAD112.3 million in Q1 last year. The decrease is primarily attributable to pressures on global advertising due to COVID-19 and policy changes on YouTube for Made For Kids content at WildBrain Spark, partially offset by stability in our other businesses. However, as noted by Eric, we are encouraged by the sequential revenue growth of WildBrain Spark revenue for Q1 which was up 37% compared to Q4.
In the quarter, we reported a net loss of CAD3.3 million versus a net loss of CAD16 million last year. This improvement was attributable to lower SG&A, lower reorganization and development cost and a higher non-cash foreign exchange gain in Q1 2021 compared to Q1 2020. We recorded positive operating cash flow in Q1 of CAD19.6 million compared to CAD29.9 million in Q1 2020 due to timing of settlement of working capital balances.
Free cash flow for Q1 2021 was negative CAD2.7 million compared to positive free cash flow of CAD7.7 million Q1 2020. This decrease was partly due to the timing of distributions to non-controlling interests in the current quarter as compared to no distributions in the prior year quarter.
Adjusted EBITDA was CAD17.5 million in Q1 2021 compared with CAD19.6 million in Q1 2020, principally related to the short term weakness in advertising revenues noted above.
Now I will turn the call back Eric.
Thank you Aaron. So in sum, we continue to execute against our long term strategies of, one, creating premium kids content, grow key brands. Two, monetizing our large audience on our AVOD network, WildBrain Spark. And three, improving our cash flow and balance sheet. And although there is still a lot of uncertainty out there, our business is demonstrating resilience as families take comfort in our entertainment content and brands. We are lining up more deals which will layer on to our current earnings base. So please stay tuned.
And now we would welcome some questions.
[Operator Instructions]. Your first question comes from the line of Deepak Kaushal of Stifel. Your line is open.
Hi. Thanks guys. Good morning and thanks for taking my question. Eric, Josh, I wanted ask you a bit more about the Apple deal. If you can kind of parse out the impacts on your production capacity and your balance sheet, particularly on the production side? Will this require an increase in production capacity? Or this factors in some from declines in other areas and that’s actually the same? And on the balance sheet side, what would be the impact to working capital and free cash flow over the next 12 to 18 months from now? Thanks.
Sure thing. Thank you Deepak. And I will certainly ask both Aaron and Josh to chime in on the multiple parts of your question. First, maybe I can describe a little bit about the magnitude of the Apple deal before we get into the production capacity issue. And certainly I wish I could tell you more details of the transaction, but I know you will appreciate that we are subject to a nondisclosure and telling you what we can.
One of the things I can highlight, by the way, is that on the library deal alone, in Q2 we are going to recognize net revenue that’s over 60% more than the last publicly reported transaction, which I believe was [indiscernible]
There has been an unexpected disconnection by that speaker. One moment, please.
At this point, let Josh try?
Yes, why don’t I jump in and pick up on the capacity question? I am happy to do that, Deepak.
So we have certainly been ramping up in the studio over the past year and we are now at the highest rate of capacity in Vancouver that we have ever been. And we expect to be able to carry on at this rate for the foreseeable future. This new Apple deal will add new productions over time and we will find ways to expand to make sure that we can accommodate and ensure that we can continue on executing on the highest quality that we have been which is really what led to the second half of the deal is how happy they have been with what we have delivered to-date.
And as far as balance sheet and cash flow, this deal is a very big positive for us on cash flow and the balance sheet. As you know, we recognize these types of deals on percentage of completion and we earn the revenue as we produce the show. And so for both balance sheets, there will be this typical production financing arrangements which are in place. But our earnings will be very positively impacted by this as well as our cash flow.
Okay. And just to be clear, in terms of the lag between revenue recognition and cash flow, the interim production financing will close that gap? Or is there going to be a certain big percentage coming from tax credit, as in the past?
There is a portion coming from tax credits. But because we recognize and get paid over the term, it’s a big positive to cash flow. We earn our producer fees and overheads during the course of production. So this is a big positive to us.
Okay. Thanks for taking my question.
Operator, do you want to introduce the next caller?
Yes. Your next alternate question comes from the line of Tim Casey of BMO. Your line is open.
Yes. A couple or three for me. I was wondering if, hopefully Eric’s back on the call, he was talking about reporting a big jump in revenues in Q2. Maybe if you could just finish that thought? And then [indiscernible] great. No problem. My two questions would be, I guess for Aaron, should we think about the profitability of the Apple arrangement as being consistent? Or will the various series and various special projects carry varying levels of profitability? Just how should we think about that over the course of the projects? And on WildBrain Spark, I appreciate there has been some sequential gains in the revenue profile. But maybe if you could talk prospectively going forward for the rest, maybe this fiscal, how you think the trend-lines that you are going to report in that business in the face of expanded viewership but an uneven ad market? How should we think about the revenue profile there? Thanks.
Thanks Tim. And again, sorry to our participants today for the disconnect. Thank you technology. So let me share this question with Aaron and first go back to your first question which was about the increase that we will be enjoying in Q2 with the recognition of net revenue. As you know, just in accounting policy, we will be aggregating the entire value of that license in Q2 which is a multiyear license. What we can say though is that it’s going to be on the order of 60% more than what was last publicly reported in the transaction between Iconix and ABC Television in 2014. That’s a matter of public record and that’s why we can share that with you today.
As to the specifics around margin and profitability of the various content that we are producing, let me have Aaron and Josh address that particular question as to what’s happening at our studio and that means our company.
Yes. So I will touch on first, Tim, your question on the production revenue. Yes, so this deal, it would be similar to the continuation of the types of projects we have been working on with Apple TV+ already. So we expect a similar profile with respect to the margin and revenue. So that’s your first question.
Your other question on Spark, we expect to continue to see a pretty significant improvement, sequential improvement quarter-over-quarter in this quarter. This quarter is a bigger quarter because it is the Christmas season. And so we will get benefits for that. But as we continue to get out there in direct ad sales which I know we have been discussing over the last quarter that we are making an investment in our direct ad sales, that also will help us continue to monetize against Spark and continue to see pretty significant improvements, sequential improvements.
Thanks for that. Eric, can you spare us all the effort of googling October 2014 and Iconix? What was the numbers they reported?
Yes. I can share that with you. They reported to $17 million. We googled it. That’s how we found out.
So we are looking at something a little north of CAD25 million on the revenue line in Q2?
That would be the math.
By the way, Tim, I will just modify that by saying, that’s U.S. dollars, not Canadian.
Eric, that’s Canadian.
No but the Iconix deal was U. S. dollars.
That’s okay. They kind of showed U.S. dollars, yes.
such as that that kind of does your dog Yes.
[Operator Instructions]. Your next question comes from the line of Drew McReynolds of RBC. Your line is open.
Thanks very much. Good morning. Two for me. Maybe for you, Eric, on the IP front. We saw with Entertainment One, for example, with Peppa Pig which I kind of view in the same category as Peanuts, just hit it out of the park and it looks like you are gaining equal success here with Peanuts. But then they took a couple of their other pieces of IP and over two or three or four year period really built those up. Wondering from your perspective when you look into your existing IP versus what is in development or maybe what you acquire, where does that stand? In other words, have you identified the piece of IP that could hit these same levels that you are doing with Peanuts currently?
Great. Thank you, Drew. So first, I appreciate the comparison to Peppa Pig. But I also wonder we will know about Peppa 70 years hence. Peanuts is frankly a bit of a unicorn in the character business, an incredible legacy, sort of sustained content production which paused many years ago and we are now accelerating to a brand-new level and always has had a remarkable consumer products business on a global basis. So I think in some ways, it defies comparison.
And I can’t say that we are going to be achieving legendary Iconix status with the balance of the IP portfolio, but that does not mean it isn’t incredibly robust and we are specifically concentrating now on a set of brands. For example, strawberry shortcake, which also has a great operating history and legacy of both immediate production and consumer product sales. And I think that that’s going to be one of the franchises coming forward.
We have been surprised, which I think I may have highlighted in our last call, by the incredible success on Netflix of Chip and Potato where a new season has been ordered and we see great consumer products potential around that franchise. We are reactivating on Teletubbies right now. We are in development on Inspector Gadget. I think you know we announced a development project around Green Hornet, an acquired property as opposed to one that resides in our library.
So I am loath to sort of predict levels of success and trying to compare them against Peanuts. What I do know is that the content pipeline has been — we have a lot of visibility on it right now and I am incredibly encouraged by what we are doing on the creative development side and how we are going to be rolling these properties out very carefully in order to achieve an evergreen status that Peanuts enjoys.
So I am happy to take a follow-up on that. But that’s generally how I would characterize it.
That is helpful and it’s good context. Thank you. Just a follow-up maybe for Aaron on the balance sheet target that you put out there? Can you just thematically talk about EBITDA growth versus free cash flow generation in arriving at that target? Thank you.
Yes, sure. I am happy to. So look, because of this deal and other deals that we have been working on, we have very good visibility on how the next eight quarters looks. And therefore, from a baseline perspective, we feel comfortable with that target that we were giving for the end our fiscal 2022. Of course, there are other things that we are working on that we expect to further improve it. But this is what we have with typically visibility into.
As far as cash flow, I think our cash flow profile will be improved as well, given that these types of deals, including the Peanuts deal, as I had mentioned before, are positive to us from a cash flow perspective and a balance sheet perspective.
Okay. So it’s kind of a combination of both free cash flow and EBITDA growth to kind of square up on that?
Yes. And Again, that doesn’t really keep other things that we are working on. I don’t know how the direct ad sales, how much of an improvement will be. We are investing in it. It’s a big focus of ours. It could do quite a bit better than what’s currently in our baseline model.
Great. Understood. Thank you.
[Operator Instructions]. Your next question comes from the line of Jeff Fan of Scotiabank. Your line is open.
Thank you. Good morning and thanks for taking my question. Just a couple. First, Eric, I think you talked about Sparks advertising rates improving. I am wondering if you can elaborate on that a little bit? And maybe also give us a little bit of an update on how direct sales was doing? And if there is anything to share regarding direct CPM versus some of your prior CPMs pre the YouTube policy change? And maybe even talk about what percentage of views, because your views are still growing very strongly. So just wondering, what percentage of your views you can monetize through the direct method? And the second question is related to your comment about the growth fund earmarked for investments. I wonder if you can just elaborate a little bit of the nature of some of these investments that we can expect to see? Thanks.
Good morning. Thanks, Jeff, for your question. So let me kind of give an overview of the shape of the recovery. So first, to those of you who have been focused on this, you will know that in the period between the Made for Kids policy change at YouTube and the COVID impacts and that was from like early January through middle of March, we saw ad rates beginning to recover significantly as advertisers adjusted their spend migration frankly between linear and digital. Our rapidly, vastly increasing audience during the COVID period, which has leveled out to more normal levels and how the YouTube ecosystem and algorithms were adjusted to the MFK changes.
So again, when COVID hit, we saw a big uplift in viewing but also a contraction in ad spend. But the studio factor of the digital ad commitments being the easiest to pull, but they also come back when consumer and advertising somewhat shifts. So since July, we have been seeing a couple of things, really a reversal in two ways. One, improving CPMs or advertising rates not really has a lot to do with that algorithm adjustment at YouTube which I referenced. And also we are enjoying new optimization for ad placement that we are on our networks and those are also contributing to results and also just seeing more ad placements.
So in a more general way and simply more macro economic factors, market sentiment is that a lot of the budgets that were pulled like travel and so forth have been reprioritized in the second-half to entertainment and toys. And we are seeing a pick up as well in those categories in the run-up to the holidays. So we have the ad dollar is coming back, that’s the good news. One of the things that I can more generally say is that the nature of ad placement on YouTube has changed meaningfully with Made for Kids.
Since targeting is no longer taking place, it really emphasizes the contextual sale and also selling directly by our own ad sales force which is one of the things that you asked about. And that effort is going pretty well. And so we are getting good visibility there, just in terms of the recovery of the market and presuming this trajectory and the compounded increases, I would say, we are pretty optimistic. And the audience continues to grow, watch time grow and while I can’t give a precise number, we will be the full beneficiary of those changes in particular with our data tools and direct ad sales and campaigns that we are doing. We have launched number of very successful digital-first campaigns for a toy company and we are sort of the leading edge of the change in market perception around we are at as expected.
Was there a second part of the question? Allow me to address that as well.
Yes .The other part, I think, that you have sort of addressed that it was really as you go through the more direct sales route, I am wondering if you think you can monetize through the direct channel all of the same view that you are monetizing before on a more under YouTube’s algo?
So I actually think we will be able to monetize much more effectively because in the auction process which was what we relied on previously before the MFK changes and launch of our own direct sales organization, we were kind of at the mercy of what came in and the varying CPMs. And we couldn’t offer really a bespoke program to advertisers, consumer product companies, et cetera.
One of the other things that we are seeing and benefiting by considerably is, believe it or not, the advent of smart TVs and penetration of those devices in the market. I am sure when you turn on your own smart TV, you will see the dozen titles come up at Netflix and Apple TV+ and HBO Max and one of those is YouTube. And so, what’s happening is the views are migrating from iPads and other display devices on to the big screen. And what that’s meant is co-viewing in almost every case. And that opens up the tremendous market of parent and caregiver demographics and consumer products.
So that’s really one of the things that I think we are going to benefit by and the advertisers are choosing to go direct. They want to get in front of our content specifically which is curated and safe. They are very sensitive to content and audience and the curation factor. They want to know where their ads are placed. And that really is drawing premium rates, which is getting to this targeted audience. So we are going to go back and tapping into that branded ad market.
Thanks Eric. And the other question was just about the growth fund and if you can just elaborate a little bit on the profile?
Sure, sure. So in the growth fund, I think when we originally talked about this, we indicated that it would be for these accretive investments. And I should just, at the risk of redundancy, remind everybody that financing structure has no impact whatsoever on our leverage ratio. So the current environment has offered us a lot of opportunities for IP investment and really to use our operating leverage to exploit that IP across various business areas. So a lot of the money we are using as an accelerator on WildBrain Spark. And as I noted in my initial comments, we really earmarked substantially all the initial fund and have transactions now under negotiation and closing. And so those really are focused on perfection of our rights ownership, not only in our existing catalog, but we have a lot of partnership deals at WildBrain Spark and we have used that for the benefit of those partnerships. So again, I can’t speak to the specific negotiations and deals but they are sort of in the same way as I indicated on past calls, please watch the space and we will be, as we can, disclosing some of those transactions.
Great. Thank you Eric.
There are no further questions over the phone lines at this time. I would turn the call back over to Nancy Chan-Palmateer.
Thank you operator and thank you everyone for joining us today. And stay well. We look forward to updating on more exciting news in the next quarter. Thank you. Have a good day.
This concludes today’s conference call. Thank you for participating. You may now disconnect.