POWW (2022 - Q3)

Good day ladies and gentlemen. Thank you for standing by. Welcome to today’s Conference Call to discuss AMMO, Inc.’s Financial Results for the Third Fiscal Quarter of 2022. At this time all, participants are in a listen-only mode. Following the formal remarks, we will conduct a question-and-answer session. Instructions will be provided at that time for you to queue up. Hosting today’s conference will be Reed Anderson with ICR. As a reminder, today’s conference is being recorded. And now I would like to turn the conference over to Mr. Anderson. Please go ahead, sir. Reed And

Thank you. Good afternoon and welcome to AMMO, Inc.’s conference call to discuss results for the third quarter of fiscal 2022. On the call today from AMMO, Inc. with prepared remarks are Fred Wagenhals, Chairman and Chief Executive Officer; Rob Goodmanson, President; and Rob Wiley, Chief Financial Officer. By now, everyone should have access to the earnings release, which went out this afternoon at approximately 4:05 P.M. Eastern Time. If you have not received the release, it is available on the Investor Relations portion of AMMO, Inc.’s website at www.ammoinc.com. This call is being webcast and a replay will be available on the company’s website as well. Before we begin, we would like to remind everyone that our prepared remarks contain forward-looking statements and management may make additional forward-looking statements in response to your questions. These statements do not guarantee future performance and therefore, undue reliance should not be placed upon them. These statements are based on current expectations of the company’s management and involve inherent risks and uncertainties, including those identified in the Risk Factors section of AMMO Inc.’s most recently filed Forms 10-K and 10-Q. Please note that during today’s call, we will discuss non-GAAP financial measures, including results on an adjusted basis. Management believes these financial measures can facilitate a more complete analysis and greater transparency into AMMO Inc.’s ongoing results of operations, particularly when comparing underlying operating results from period-to-period. We have included a reconciliation of these non-GAAP measures with today’s release. This call also contains time-sensitive information that is accurate only as of the date of this live broadcast, February 14, 2022. AMMO Inc. assumes no obligation to update any forward-looking projections that maybe made in today’s release or call. Now, I will turn the call over to Fred Wagenhals, Chairman and Chief Executive Officer of AMMO Inc.

Thanks Reed. Good afternoon and thank you all for joining us today. Q3 was another record setting quarter for our company and our strategy and our amazing team's work ethics is driving record results. We have again reached another record-breaking quarter sales and set new records for EBITDA, making our ninth straight quarter of record financial performance. AMMO's year-to-date revenues growth rate of 344% was driven from a revenue base that grew by approximately 287% in comparison to a year-over-year quarterly comparison. These results were fueled by continuing high demand for our key products across our portfolio, coupled with organic growth as a result of our new innovation and continue scaling and efficiencies of operation at the Ammunition and GunBroker.com marketplace operational levels. As we continue to integrate and leverage the GunBroker.com marketplace, it posted an impressive quarter of performance, especially when you consider the post-COVID market the industry has been operating in since April 2020. These impressive results are truly a testament to our team effort. I would like to bring you up-to-date and answer most of the questions I get hit with daily from investors. Stock repurchase. The Board of Directors recently authorized a share repurchase program for up to $30 million of its outstanding common stock. This repurchase of up to $30 million of stock represents our commitment to increasing shareholder value and gives us flexibility to deploy some of our cash flow into our future. Our strong balance sheet and rapidly growing revenues, we believe it is appropriate to have the option to repurchase stock if it makes sense as the best investment at that time. Capacity, as we noted in our recent revenue guidance for a full year of fiscal 2022 of $250 million, we see no slowdown in demand for our ammunition. At our current production levels, our entire production is completely sold out for 2022. We are increasing production monthly and look forward to the completion of our new state-of-the-art manufacturing facility. This facility will allow us to ramp up capacity quickly to meet customers' demand. We continue to invest in people and manufacturing equipment as we prepare to launch our new facility. We are well-positioned to execute and drive shareholder value at this time. GunBroker.com. Growth in our GunBroker.com marketplace continues at double-digit rates. We continue to work diligently to meet the growth demand for all our products and service on this site. We are bringing new products to sell on GunBroker.com as well as improving the overall customer experience in 2022. New facility. As shareholders know we are building a new 160,000 square foot state-of-the-art facility. It is on time and currently expected to open in the summer of 2022 with capacity approaching 1 billion rounds annually. This will allow us to keep up with the strong demand we continue to see in the ammunition market. With that, I will turn it over to Rob Goodmanson, our President.

Thank you, Fred and welcome everyone. Its pleasure to speak with you today. We are proud of the incredible team that Fred has put together and grateful for everyone's ongoing efforts that have led to another strong quarterly sales and earnings growth. The 289% increase in total revenues to a record $64.7 million continue to reflect broad based growth across our business. Gross margins improved to 34.8% in the third quarter compared to 20.1% a year ago, driven by this powerful dynamics of our marketplace platform. We also delivered significant operating expenses leverage, reflecting the benefits of our growing scale. However, we did have a slight decrease in margins versus last quarter, due primarily to the additional hiring in Manitowoc. For many of these positions require three to six months of training, we felt it was prudent to get a jumpstart on the staffing prior to our facility opening. As Fred mentioned, the underlying demand for ammunition remains very strong and we expect this continue -- this to continue well beyond 2022. Moreover, AMMO has many unique products incorporating proprietary technologies that put us in an even stronger position to capitalize on industry tailwinds and continue gaining market share. Our marketplace business is the other key point of differentiation for AMMO is driving our significant growth and profitability. Let me share some details about this business to give you a better understanding of the results and significant long-term potential. We've shown that we're a superior manufacturing and our sales growth and earnings prove that out. With a new facility coming online this summer, we've turned our focus to GunBroker.com. Having acquired the largest marketplace business in the industry, gives us the opportunity to grow and leverage this incredible business. We are adding significant value-added services to the platform, such as credit cards, loyalty programs for both buyers and sellers, gift cards, letters of credit to our 6.8 million registered users at the same time. We're updating our technology on the platform to give our customers a great experience that is seamless and easy to navigate. Finally, here's some stats for GunBroker for the third quarter. We averaged 55,000 new users per month. We had a 33.4% increase in the average number of auctions. Our average take rate was 5.4% for the quarter versus 4.6% a year ago. Our loyalty program increased 8.8% from the prior year. Before turning the call over to Rob Wiley, I want to add that we have come a long way in a relatively short period of time, building a solid foundation for driving profitability and focus growth. We're proud of our accomplishments in third quarter and remain well-positioned for significant growth in the future. Our unique proprietary ammunition business continues benefiting from strong industry demand, coupled with our efforts to aggressively expand capacity. Our marketplace business remains transformational factor that is in the very early innings, amplifying revenue growth and dramatically reshaping our profitability profile. With that, I'd like to turn this over to our CFO, Rob Wiley. Rob?

Thank you, Rob. Welcome everyone. Let me walk you through our third quarter financials in more detail. Total net revenues for our third fiscal quarter of 2022 were $64.7 million, up 289% from $16.6 million in the year earlier period. Ammunition sales increased 243% to $44.1 million and our marketplace segment had revenue of $17.5 million versus nothing a year earlier, reflecting the acquisition of GunBroker.com at the end of April 2021. Gross profit of $22.5 million in the third quarter compared to $3.3 million in the year earlier period reflected the significant growth in the total revenue. We delivered another quarter of significant gross margin improvement due to the addition of marketplace revenue. For the third quarter, gross margin was 34.8% compared to 20.1% a year earlier. As we prepare for our new facility and planned capacity increases coming online in the second quarter of our next fiscal year, we've added additional labor and overhead expenses in this reporting quarter and in order to make for a safe transition. This is contributed to a temporary compression in our ammunition segment margin from our previous quarter, which we expect to benefit from in our next fiscal year. Third quarter operating expenses totaled $11.9 million, up to $3.8 million from a year ago. The year-over-year increase in operating expenses was largely driven by the addition of GunBroker.com including $3.3 million incremental non-cash depreciation and amortization. As a percentage of net sales, operating expenses declined by 18.8% year-over-year to 18.4% in the third quarter of fiscal 2022 from 22.7% in the year earlier period, due to the mix of higher margin marketplace revenues plus operating efficiencies related to our increased scale. Operating income was $10.6 million in the third quarter compared to an operating loss of $0.4 million in the year earlier period. As a percentage of net revenues, operating income was 16.4% compared to a negative 2.6% a year earlier, a 731% increase. Net income available to common shareholders for the third quarter of fiscal 2022 was $8.3 million or $0.07 per diluted share compared to a net loss of $1.9 million or $0.04 per diluted share in the third quarter of fiscal 2021. Adjusted net income per diluted share was $0.14 versus adjusted net income per share of $0.02 in the year earlier period. Adjusted EBITDA was $20.1 million compared to adjusted EBITDA of $2.4 million in the year earlier period. The significant improvement in adjusted EBITDA was due to increased sales and improved gross margins, reflecting growth in our core ammunition segments, plus the addition of a higher margin marketplace segment. Please note that adjusted EBITDA is a non-GAAP measure and you should refer to the reconciliation of our GAAP to non-GAAP results in today's press release for additional details. our balance sheet remains strong with $27 million of cash equivalents and essentially no outstanding debt. 100% of our production for 2022 has been sold until our new facility comes online in the summer of 2022, which will add significant capacity increases. As Fred mentioned in his remarks, our Board of Directors recently authorized the purchase of up to $30 million of stock. We are maintaining fiscal 2022 guidance and continue to expect net revenues of approximately $250 million, adjusted EBITDA of at least $80 million for the year ending March 31st, 2022. This concludes our prepared remarks. We're now ready to take questions. So, I'll pass it back to our moderator. Thank you.

Thank you. At this time, we will be conducting a question-and-answer session. [Operator Instructions] Our first question is from Matthew Koranda of ROTH Capital. Please proceed to your question.

Hey guys, good afternoon. Just wanted to start off with the guidance for fiscal 2022 and just the implied guide for the fourth quarter, it seems like pretty confident that we can do the $80 million that would be required to kind of get to the $250 million for the full year. Any help in terms of just breaking that out maybe in the fourth quarter between the marketplace segments and the core ammo business. And just -- I was just kind of doing high level math, but assuming GunBroker kind of sustains at that $17 million run rate that it's been at, I guess the core ammo segment is going to take a pretty big step-up in terms of revenue production in the fourth quarter. So, is that the right way to think about how the fourth quarter trends? And then maybe if you could just put a finer point on what you mean when you say sold out for the rest of the year in the ammo segments sort of what that means in terms of the capacity to produce? And where are you in terms of utilization that'd be great?

Hey, Matt, this is Rob Wiley, thank you for the question. I think your thought process about our guidance setting into our final fiscal quarter of this year is spot on, we really look at the breakdown between our ammunition segment and our marketplace segment. Kind of around a high to mid -- mid to high 70 split for the ammunition segment and a low to mid-20 split for the marketplace segment.

Okay, great. And then just on capacity, any help on that front just and it felt like Q3, kind of -- maybe we were a bit capacity constrained within the quarter. So, just maybe help us understand sort of the equipment installation, labor that's in place to kind of take that step up in terms of production in the fourth quarter here for the core ammo segment.

Yes, we'll continue to add capacity heading into the end of this year, until we move into our new facility. But the bulk of the capacity increase that you'll see later on down the road is when we do move on to the new facility and able to bring on even more equipment online to increase our production capacity.

Okay, great. And then you guys didn't share backlog, but you said sold out for the rest of the year. Could you maybe just clarify if you could sort of what that means in terms of where are we in terms of our capacity to produce for the fourth quarter? And then how far -- I assume you mean sold out for the rest of this fiscal year, but maybe if you could just kind of touch on that as well it'd be super helpful?

The fiscal year -- we're sold out for the fiscal year.

Okay--

But I think -- what we're trying to is that, as we mentioned our backlog is sold out for the remainder of the fiscal year. So, we're trying to give confidence in the guidance and our set -- that we set in our ability to meet it.

Got you. Okay, fair enough. And then just two quick other ones for me. So, on the gross margin side, if I sort of strip out GunBroker, which is a relatively high margin business, just trying to get at sort of what we saw in the core ammo segment in terms of gross margins. I know you guys alluded to sort of, you know, wanting to be ready to produce and that's a lot when that opens up, so you're willing to incur a little bit of extra labor in the near-term, to sort of make sure that that ramps smoothly. But anyway, you could just kind of help us understand the movement in gross margin on a quarter-over-quarter basis. Was it all just the labor, the incremental labor that they hired, any other kind of puts in takes the can provide around sort of the movements and maybe raw costs and other elements that drove gross margin in the third quarter, relative to the second?

Yes, I think the biggest change in our margin comparing quarter-over-quarter is really the investment that we're making currently into our future by hiring additional employees currently, adding additional overhead expenses as well. This is something that you're seeing -- our margin has compressed a little bit from the prior quarter, but something that we have fully expect to be benefit from heading into our next fiscal years as soon as our new facility opens up.

Okay, great. And then just last one on the marketplace business, I mean, take rate looks phenomenally good. Just curious, if you could maybe speak to GMP at GunBroker and sort of the trends you're seeing there, it sounds like volume is up quite a bit on a year-over-year basis; take rate is up nicely, on a year-over-year basis. Anything you could say on AOVs or other elements to the GunBroker business that would help us kind of get a little bit more clarity on that?

I think if you look revenues were $17.6 million. You're correct, we're up just under 20% on our auction fees. If you look at the number of auctions, that increased by over 33%, loyalty program was up, and we're still pulling in 55,000 new users on a monthly basis. Would we anticipate the GMP to increase? Yes. And with the other additional things that are just coming online, I think we can maintain and continue to grow this fairly healthy pace.

Excellent. I'll turn it over to others here. Thanks for all the clarity, guys. Appreciate it.

Thank you, Matt.

Our next question is from Mark Smith of Lake Street Capital Markets. Please proceed with your question.

Good afternoon, guys. A couple from the first high level at we've got a couple quarters of GunBroker behind us now talk about kind of where that business is relative to your expectations, and maybe where you are in rollout of new initiatives within GunBroker? And what else there is still to do. All we still have a little bit to do with GunBroker, we have been rolling out -- there's different programs or credit cards or financials or loyalty, it's adding additional products on to the program. It's taken me a little bit longer than we anticipated because of the system changes that we need to do, which just have to get done to make that streamlined and more beneficial. And that is coming on; that area of our business, Mark, is growing up nicely. We've got great people in place, and they're making very good headway. We only been doing this really about a month and a half. We've already put aside the capital that we said we would put toward that venture. Not all of its used at once, obviously, but a number of products are moving through and there's a few more additional pieces which will be coming online shortly, which should just help that also increase dramatically.

Perfect. And if we look through just another question on the gross profit margin, within kind of the Ammo and case-in sales business, can you walk through what you're seeing on the commodity and input costs, any headwinds that you're seeing and maybe any update on supply chain costs as well?

I don't really think there's been any significant change as far as cost goes and our materials, but I think we said this pretty much on every call, you know, I know he said it last earnings call that we continue to push on any increases to our customers. So -- but staying relatively stable overall.

Okay, perfect. And then maybe just on pricing as we look at ammunition, you just said you're able to take price and kind of pass through -- do you feel like you're still in a pretty good position on taking incremental price, or over the last year plus of price increases, do you feel like you're getting closer to a ceiling?

Well, every time you think you're getting closer to a ceiling, we always seem to have just raise their prices again, which they just did, I believe today. And then we're going to continue to pass it on. There's a few SKUs that have come backward a little bit, still trading at a relative high. But not a ridiculous amount, like the 9 million, $3.3 million [ph], the commodity type round. We answer that by retooling our machines, going more to the higher profitability rounds. That really not enough people are making today. So it'll allow us to gain some more shelf space as well. That's part of our plan.

Excellent. Thank you guys.

Our next question is from Eddie Reilly of EF Hutton. Please proceed with your question.

Hey guys, looks like you're really beginning to hit your stride here. Wondering if you can talk about the industry landscape a little bit. Are you seeing any meaningful expansion of industry-wide capacity at all many of your competitors?

I think EFC [ph] adding that the capacity is still not caught up to the demand that is not slowed for sure. We're not seeing that to the addition of all the new shooters over the last number of years. We're still the razor blade and we're not -- I know you probably saw a report from Smith & Wesson, that they were -- their inventories were up. But we are not in the gun business, we're in the ammunition business. We're just not seeing the slowing yet.

And I guess from the time new Manitowoc facility is up and running, could you take us to the timeline of how quickly that -- how quickly you guys to ramp up production in that facility?

I think the ramp will not be as long as people will anticipate because we'll start moving machines and possibly won't be hooked up exactly, right away. And the new building is about two blocks from the previous building, very short. And we anticipate we've got two other warehouses, Eddie that have our holding machines that we have no space for. So, those can go in right away. We're not losing production. And so as we move some of the stuff over, we'll start producing there and keep producing in our existing facility until everything's over. And by that time, we should be running a significantly higher rate. And another note, I don't think anybody understands what we've went through to make the numbers that we just posted. I mean, we're a company right now that's running three different buildings, traveling 10 miles from one building to the other. We've got two shipping docks versus eight when we get on our new building. We've got trucks lined up to receive merchandise, we got trucks waiting to take merchandise out. So, our people have done one hell of a job in accomplishing this goal under the circumstances that we now work under? So, I mean, if you went to our plant now there, it's people standing on top of people making product. So, it's -- we can't wait to get in this new building. We got machinery and equipment, it's going to cut costs. We got automation equipment that we built that will cut costs. And we've got we've got space, space that we don't have today. So, it throw on top of that we -- this quarter, we had 14 people in our Scottsdale office out with COVID. We got people in Manitowoc with COVID. You go to hire 100 people, you better take 300 or 400 applications to get 100. So, it's -- our HR department has done a hell of a job. So, I give our people a lot of credit for doing what they've done under the circumstances that we worked under this quarter.

Really appreciate the color there. And just as we head into summer 2022, what type of utilization rates would be expect on demand facility, just I guess maybe in that first quarter--

I think that's going to be kind of something that we look to gearing up to. And we'll have a better idea of the closer we get there. And as far as when, as far as mapping out the move, and kind of the strategy in place of how we move the pieces of equipment and when we move it to maximize our capacity. So, that's something that we're currently working on to this day.

Okay. Fine. Thanks guys. That’s all for me.

Our next question is from Andy Johnson of Royal Capital. Please proceed with your question.

Good afternoon. Last quarter, I think Fred indicated in the new facility with already a purchased -- already purchased equipment, you could save a penny a bullet on street game edition that I wanted to try to get some additional color on that like, how much of the ammunition that's produced now is street ammunition. Is that likely to go up percentage-wise in the new facility? Final question is do you--

[indiscernible]?

Yes?

Go ahead and finish your question.

Finally, what appetite do you see the military having for ammunition? And if you do -- when you do get a military contract, do you give military contracts priority? Thank you.

Okay, as far as the equipment I spoke to you before, which was an annealing machine, that will save us a $0.01 to $0.015 depending on the caliber on our brass casings, and we won't have to send the product out to have to annealed. That equipment, we've owned it now for about a year and a half. It's been sitting in a warehouse for a year and a half and we have no space to put it up until we get in our new building. So, it probably will not be say August, September before that equipment is up and running, account for that saving. As far as the military goes -- as far as the military go, John Flynn has been working for probably three years on the project. And I just heard an update today, so from Mark Hanish, is co-partner in this project. So, John, you want to do in some flavor on?

Sure. Thanks Fred. We have we have from a capacity and capability standpoint, the plan all along is able to service continue to service the commercial needs, while tooling up with the lines of machinery required to support the military programs that we're working under. We have two contracts in place right now in the developmental side that are going well. And we have the capacity to satisfy those contracts now and in the future with the CapEx that we expended over the past couple of years to make sure we were prepared to perform.

Andy, are you still there?

Yes, I guess my last part of the question was, what percentage of the ammunition that is manufactured is street ammunition? And again, do you anticipate that staying the same or going up?

We anticipate it going up and it's probably about 30% right now.

Thank you.

And we've just put some new systems in place that will increase that production.

Yes, our streak production this fiscal year hasn't been the same percentage overall, out of our total sales as it has been in prior years. And this is us -- due to us moving our streak line from place in Arizona to Manitowoc, Wisconsin. During this time as well we also improve the manufacturing process of our street production and have actually increased the capacity through that as well. So, increases coming to that production -- that product line in the future.

Thank you, gentlemen.

Our next question is from Brandon Beylo of Metro [ph]. Please proceed with your question.

Hey, guys. Macro Ops not Metro, but great quarter again. Just wanted to get some thoughts on the share buyback program. I think it was important for shareholders to kind of see that, especially as the stocks down, , 60% or so this year, so seems like an opportune time to kind of do something like that. I want to get insight into how you thought about that share repurchase program because with the business that's growing, whether it's your core ammunition business, whether it's the marketplace business, there's a lot of areas that you could probably allocate capital to generate high returns. And so to me, seeing that you've segmented $30 million to a share buyback, kind of, comes as a realization that you guys think the shares are pretty undervalued. So, walk us through, if you can, the internal dialogue on -- okay, how much do we do in the buyback? Do we do the buyback versus reinvest in the business, just to kind of get a sense of how you guys think about capital allocation?

Through the discussions that we've had, I think you're spot on that the stock is undervalued and should be purchased at this point. We have very strong balance sheet, which is not -- which will not stop us from increasing additional products, machinery, with the ammunition or putting in the changes we're putting in for the GunBroker.com division. But when it's down like this, I think it was the best move for the shareholders. I think it's the one of the best moves for us.

Got it. And then just another comment, gentlemen, in the same vein, last few years, you guys have issued a lot of stock and most of this is kind of justifiable, whether it's to use this currency to kind of fund your growth. And then to buy Gunbroker.com, again, pretty accretive acquisition, how do you then think about share issuance over the next three to five years? I mean, given your balance sheet and the fact that you guys are now not only on an adjusted basis profitable, but on a GAAP -- net income based profitable. Doesn't seem like there should be a reason to issue more shares. So, is it reasonable to assume that we shouldn't necessarily see any more dilution going forward barring any sort of special one off acquisition where it may be would make sense to, to kind of pay for some of that in stock.

At this point, we have no plans to issue any more stock. That doesn't mean it couldn't happen for, let's say, another acquisition. GunBroker, like -- type. But this is one of the also one of the reasons why we do the share buyback, to get fewer shares out there and make the value there. And we think will make -- that was a solid decision to make, just because of where it was trading, and what we think the actual value of the shares are.

Got it. And then I've got one more for Fred and Rob Wiley. A lots gone right from your guy's business, the growth is pretty incredible. But what I want to know is for both Fred and Rob, what are some things that kind of keep you guys up at night about the business, might be things that are improving, but not at the rate that you want? Or just maybe competitive, dynamic pressures that you guys are kind of trying to battle? So, I know that there's so much that's gone, right? But what are some things that that do keep you up at night, if anything?

People -- number one, getting people to come to work every day. And number two would be since I'm 80 years old, I guess keeps me up is stock price. I'd like to see it higher. But I learned a long time ago, it's just a matter of keeping blinders on and focusing on your business and keep making money and keep making earnings. And don't do anything stupid and make accretive acquisitions if we got to make one and eventually the stock price will be what it should be.

That was very well Fred said. I don't know if I have much to add on to that. My response would be very similar. So, I'll leave it at that.

There's got to be something Rob, come on. There's got to be -- there's got to be something different than Fred's.

I mean, people -- yes, people is a tough problem. But we've done a really good job. We have a great team here in the Scottsdale office and also in Manitowoc, Wisconsin. So, people is always a tough problem. It's a problem with any company. But I think we've done a really good job of managing it and we have a great team here with us at MOE [ph].

But I think one more thing is, John, just happens to be in here, but John and Mark have worked very hard on these two military orders that we're working on. And as you know -- or probably know, it's not easy dealing with the United States government. So, nothing comes fast and nothing comes easy. And I've got signs all over this building that people don't really think I have much patience. For me, what keeps me up at night is I have no patience. So, I want to do things faster than what probably our plant manager in Manitowoc wants to do them and people working on military want to do, but we got a great group of people that we meet every morning at 8 o'clock, and we focus on the numbers, and we focus on building this company. And it's -- you look at the chart, going from $2 million to $250 million is a big deal in five years. So, yes, there's still a lot to do and I think we're confident that we can build a $400 million, $500 million company.

Yes, no, I mean, I was -- I remember when you guys were -- I think it was [indiscernible] Vista, or that show business that bought ammo a few years ago. So, I've been here for a while and I hope you guys keep executing. And now that the prices are at attractive levels, would be -- it'd be great to see some open market purchasing from the company. And also from some of the insiders, if you guys have the available discretionary income. So, again, great quarter, I'm going to log off and kind of go back and listen mode, but keep up the good work, guys.

Thank you very much.

Thank you very much.

We have reached the end of the question-and-answer session. I will now turn the call back over to Fred Wagenhals for closing remarks.

I just want to thank all the shareholders that have stuck with us and have watched us grow from $2 million to going over $200 million right now. So, just stick in there with us and watch us grow to $0.5 billion company.

This concludes today's conference. You may disconnect your lines at this time. Thank you for your participation and have a great day.