ePlus (PLUS) 24 May 182018 Q4 Earnings call transcript

Good day, ladies and gentlemen. Welcome to the ePlus Earnings Results Conference Call.

As a reminder, this conference call is being recorded. I would now like to introduce your host for today’s conference, Mr. Kley Parkhurst, SVP. begin. may you Sir,

joining for us you today. Thank

materially may and that call Marion, based management’s CFO; the want risks are take this remind responsibility the not and of estimates these is future of afternoon the vary certain maybe the current make General earnings March XXXX release including forward-looking in our Mark Elaine President; to new statements statements you with year and to anticipated moment to information forward-looking or and in to uncertainties detailed for XX, historical CEO a Commission, statements and when due that and filings Form on update Actual future projections. I Exchange we we afternoon this Marron, results Counsel. events. Securities On light the deemed no Erica be filed. to facts any our XX-K ended Stoecker, undertakes our The are issued and periodic company and plans,

each now Mark ended XX, and turn the call split. like on weighted XXXX the statements average and period website share shares financial Information relating to at our stock for of stock fiscal call, XXXX the been due of the during March of which to presentation included to data. years have non-GAAP to measures financial I’d stock all reconciliation prior stockholders’ addition, amounts www.eplus.com. per make the reference we of in the we Reclassifications In March GAAP Mark? numbers the conform XX, on of effect of in share to to retroactively amounts and Investor split effect over include the per posted and made have to amounts was the split current XXXX. our period earnings and financial Marron. The is in release a may equity section common shares the recognized share The outstanding

been Thanks, and thank speak you for participating from are adjusting to underlying all our fourth call work to quarter focus year relate the in that to to business trends full results. some quarter takeaways Clay the and There today’s industry anticipating our have results doing on for fourth position key strong relate to and and future, XXXX in the we some our to discuss the our execution. four

dollars while as software in in way out a and million. on The was margin. important profit gross note is the that of improvement revenue little and landscape. a large of our as achieved first track project recognition speak impact given On consolidated the prior profit on the the of quarters solutions changes we called This revenue a and key was evident stable base, will gross I at to metric the $XX.X more in changes runoff to factor X.X% in industry we a today’s accomplishment basis, while the which our as look consumed. gross increased profit are an our progress well in gross to

and we up customers. of which with as strategy, are margin land-and-expand gross our and the success of the investments with products margins well high large pleased over developing gross clients leading quarter, demonstrates services on solutions fourth profit the industry gross and our consolidated XX.X% basis the margins that in reported We benefit us in of increased as reaching the gross prior the our delivering This points XX.X%, and with in services enterprise for year. the complex growth gets value-added door our XXX

services in growth our the Next is business.

backlog significantly. annuity base and quality continues revenue our growing to We increase have a

both several professional the services, enhanced support services acquisitions. managed in organically maintenance capabilities Over our and last built out have and years, we through

offerings remain adding platform service a to the by flexibility professionals sheet. in and time, significant invest cloud demand. offerings those strategic that training we is in and by of At balance solutions in same and which the capabilities open customer leveraging and and We strength our customer-facing continue our build-out there acquisitions areas and to OneCloud strong help IDS like our

for security Third, were another strong services and sales product the fourth year. point quarter and the

We products this XX.X% of continue arena share and to fourth by gain in services sales important evidenced the to in grow security in additional our business growth increasingly the as quarter.

be and and services points and we products basis XX.X% up And security of an in other throughout an up gross made the sales progress Momentum and this reducing to costs where XXXX, areas. our XX.X% expect staff ePlus. year on adjusted of continue area important represented were fiscal while XXX finally, For up effort year-on-year. to billings, built realignment we for growth to resource necessary

while overall we was our year-on-year, technology While high X.X% the The is as upside should at time realignment, same through segment underlining see evident from adding rationalization headcount is important staff harder XXXX. to more cost demand and this up more to move what optimizing areas the of involves also cost structure. customer be which

is you ePlus over in customer several the and our credentialed in substantial in past trends of transacted made know, staff years many demand has anticipation of both technical As highly industry. investments way the changing in business

we some are services and will perspective, our vendors. and in our pay place providing technology the solutions customers, both our want respect profit believe need believe the increasingly many model solutions business a maybe our period our good solution visibility future being we the by and on is period. additional indicator a less win need From higher during middle-market ability the taking as we on sales develop gross should investments result, industry. they quality requirements to and to benefits us basis cloud or they up-sell any Gross major of This important the contribution hand can the generally pressure customers provide potential a of their in technology in and revenue profit are to example well-positioned to inflection with a today for importantly, consume customer. success the a change and well a financing assess to from to our of a there the our the changes capabilities sales our benefit build with And and onsite One both its approach give The to services several vendors engagement and way performance. continue relationship the model of is in annuity subscription margin leverage that positioned sold them. and to on gross revenue recognized We to gross of of in ePlus. of subscription and our And margin. with be subscription a Similarly, positive are indicative by given One that impact seeing these are is services. designs. our are We transition on initial longer one-time increasing revenue giving these other sales progress. recent only over with streams is solutions ratable paid solution years our us annuity started

services did our $X broader are a ago. Disaster that that across well. offerings will to be with them expanding are that a service with able as as to this our areas enhancing customer by sell back high-growth and leverage about recognized other generate overall ratably Service the customers footprint. and and months Recovery the We emphasis are digital We to us service in This solutions on approximately technologies year for them offerings, committed that expertise Backup also engagement XX over focus acquisition will offerings a not allows annuity IDS to million infrastructure. high project cloud, our to changing we our margin. from security capability from the cloud leverage now Service our not namely It and base. as a demand What and healthy we remain a have is What ePlus is to notable our emerging our go while is on acquisitions able is

provides Cisco our us Global Europe Our UK support international competitive to recently customers with market gained advantages revenue. and in enables additional Gold and on IGX multinational our build certification, Continental better which us subsidiary, and across international the

with year-on-year Sales X.X% gross For to the consolidated with XX is of $XXX.X am point expansion X.X% profit happy million, particularly our a which a drive record our billion, margin pleased we I XX.X%, $X.XX are year, and basis a gross year-over-year, very increase. helped a increase results. reached which

business a additional financing Our double-digit and in this will Elaine both sales had strong growth and year operating business. color on with provide income

expect year fiscal While profitability, it in not to performance to XXXX our fiscal replicate do XXXX. this it additive we was

our and years our pleased of With the that additional to Vice recently has of am management early XXXX really our over announce Darren President Officer plus executive results. depth and to ePlus of gives to as to Sales. Marion named call quarter to Operating Technology Darren Additionally, we I Elaine? team Raiguel year we this with review scale Elaine us month as served been business. that over of ePlus for and XX expansion President the will Chief turn CFO, fiscal technology. Executive This I full fourth now our background, continue most

lead joining Thank would I like our a everyone few you call. and off you, thank highlights. to financial for Mark with

XXXX and of enable began large quarter revenue across pleased potential XXXX. to margin of up-sell delivering types in expansion further largely report gross in the project growth comparison, quarter building EBITDA. customers We the that and of are margin we additional large These in that profit, including we completed to adjusted and priced metrics, services competitively us projects relating substantially gross gross we tough growth future the profit the to First, a periods. and solid fiscal achieved key fourth for enterprise third fiscal penetrate think particularly

brought EPS the the re-measurement The to finalize statutory in adjustments tax Second, performance to to related and rate. primary for included our liabilities quarter of adjustment fourth federal XX%. was deferred the tax which assets the rate the quarter change effective

tax expect we approximately XX%. effective Going rate of forward, an

calculate have non-GAAP stock we we compensation the to EPS expenses. Third, include acquisition-related way and adjusted and adjusted EBITDA

discussion results. of I our quarterly Now, begin will my

amounted expenses higher to Gross quarter mainly XXXX gross of million the margin from for services. related to higher in despite OneCloud below grew point gross headcount sales to salaries ago in September the XXX X.X% compensation to profit XX.X%. million our million, attributable product $XX.X consolidated previously in XXXX a Operating fourth IDS expansion result Our amounted primarily and to higher and increase benefits consolidated due profit. as $XX.X the to a acquisitions quarter margin variable sales and additional This the just and XXXX of of $XXX.X basis year in to and the mainly $XXX.X X.X% due reached in by million May margin mentioned. of higher net is project gross quarter large reported fiscal

and license software grew expenses to expenses an to maintenance mainly G&A Our by in acquisitions. due XX.X% related consideration and to adjustments increase contingent

the As million X.X% year-over-year $X higher $XX.X an as SG&A acquisition-related operating by of points income as a quarter year. increased to year. of amortization, EBITDA quarter from basis result EBITDA X.X% million margin the for million $XX.X same in well adjusted comparable from our X.X% our additional million period declined $XX.X and the last XX to increased Adjusted from last

$XX.X $X.X last or earnings consolidated Our amounted $X.XX share year. million per or million diluted net per to to share $X.XX compared

rate. million As of we federal the rate third decline attributable the was under of a was to which remeasurement quarter, tax estimate higher $X.X we the new tax in this recorded deferred the XX% I adjustment noted income taxes earlier, as than a year-over-year to mainly due had usual to

For fiscal the $X.XX XX%. fiscal share representing XXXX, XXXX. tax amounted continue from X.X% a Non-GAAP an to quarter increase approximately rate to earnings in we diluted fourth of per expect effective $X.XX of

technology had billings the segment technology in due Of primarily X,XXX representing services of product the March gross XXXX, to of from of expenses. to from $XX.X Adjusted third-party maintenance quarter the mix XX.X% from performance IDS. XXXX. an for product represented primarily which to of above revenue. X.X% margin the of We on Now, increase X,XXX XX and million, acquisitions $XXX.X in employees higher segment million an for as of a yielding runoff XX reached the maintenance ago you year quarter The our million points I of higher $XX.X and product OneCloud result Operating gross basis a million, were XXX a increase XX.X%, of Net was million, at consolidated X.X% an as employees result last as and a of compared technology engineering of in as margins XX the in additions, X.X% give of year-over-year increase the the new fourth XXXX. lower new better software adjusted over million, as staff year-over-year. of $XXX of up amounted million, sales. of million $XXX.X fourth for almost segment, to income the XX.X% offenses and quarter, the billings Gross of $XX.X fiscal in amounted EBITDA $XX.X more X.X% period as services was ago. technology the segment $XX revenue $XXX.X staff. and the for year hires quarter in well large sales financial comparable up color will the quarter XX% of were quarter sales. million, in over year adjusted up project. XXXX net was the Operating a as decline on compared primarily to proportion and with services XX.X% the administrative fiscal prior last quarter well products adjustment SG&A and fiscal increase sales to year the services remaining result assurance, reflecting represented X% and services fourth personnel Gross $XX.X year software profit million the quarter a the $XX.X end same an from was million

as the several part reported Now on year. of growth earnings. $XX.X portfolio of XXXX post-contract strong benefited to turning This $XX.X last business in to compared sale from to earnings in fiscal compare her million related revenue higher the segment, financing as to quarter to from we a increase of due an equipment leases million well our fourth

the in losses were million, in credit $X.X for quarter gross $X.X resulting offset fourth compensation costs. profit due with lower in million last partially by to changes fees from and XX.X% were expenses other higher Our representing interest year’s segment from financing financing increase variable that in professional coupled operating reserves and the higher

XXXX. Adjusted was was income the million, operating XX.X% $X.X quarter EBITDA below quarter fiscal of result, fourth XXXX. the a fourth million, XX.X% As below $X.X fiscal of

for me year the our Now, performance of financial summarize briefly let full XXXX. fiscal

net basis billings X.X% strong billion $X.XX segment a XX.X% year-on-year up basis increase diluted expansion to services $XXX.X and XX million. for per supported XXXX year-over-year, to a Adjusted XXXX. reached were up while where up technology was and above $X.XX Net billion, revenue margin points EBITDA $X.XX for gross $X.XX, $XX.X the growth the consolidated $XXX.X and million, diluted $XX.X products performance share XX.X%. X% X.X% segment, non-GAAP Adjusted to the XX.X%, earnings to $X.XX in X% fiscal was Our X.X. earnings sales profit million, were driven the net amounted billion, and a margin for gross point earnings increased $X.XX on to improved year gross sales by per our X.X% XX increase in X.X%. by Gross was financing increased Fully X.X% million. representing year share

decreased equivalents to end the XXXX. of year-on-year Inventory by XX.X% sheet, Moving at revenue we we due fiscal primarily and to $XX.X up million the cash large delivered. Deferred $XXX.X large projects from spoke cash decreased the was balance year the XX.X% $XXX.X million about to same ended of project. the with million, as

consider cash Our us business. scale healthy allows our position strong balance strategic to acquisitions sheet and to further

fiscal million to almost we shares. XXXX, During $XX.X XXX,XXX spent repurchase

Our sequentially. cycle with XX at XXXX and XX cash the end conversion compared flat of decreased remained fiscal days days

the again sales fiscal once XX%. trailing representing retrospective smaller we and Looking our revenue approximately we In XX, were for our a attributed ended as full entertainment healthcare. as of SLED standard XX% services and classify using client year media XX-month at XXXX, adopt respectively. to was is technology end Telecom, that June methods. our the on XX% basis, quarter remaining markets and Financial types XX% new total will full markets, largest was certain represented XX% the The other.

change We have revenue from accounting policies. technology materially determined current for segment our that within our our will not

we March Form a revenue will illustrated sales basis, be our result increase will for million currently to sale standard, The $X.X in will will the to new off-lease financing shortly. previous However, the reported years revenues in under net which gross segment, recognize an on which changes our file the a net XX, the year the on in we basis of XX-K XXXX. ended on recognize we of equipment

Looking focused operating to Mark. cost we gross while Mark? growing the fiscal ahead to over continuing profit to allow optimizing to XXXX, call remain and back for leverage and our our will on today. us in technology you improve structure Thank invest turn your time people. now to I

Elaine. Thanks,

XXXX our progress our pleased are our with and in executing strategy. We results long-term on

acquisitions be and fiscal with Higher offerings. combined in and Within on Market economy. our would gross We now the their cloud customers gross strong our we Operator, continued objectives. to on invest them effective XXXX resource to dollars tax security, dynamics XXXX, open support achieve while corporate sharp the focused organically in leverage have our services areas heading are focus emphasis infrastructure fiscal should growing costs support service operating and and added on business growth. key on profit savings we and to continue through into and a from help with like alignment I benefiting solutions to future digital profit this positive call environment, dollars and appear questions. building for for our

Instructions] with Thank from question you. Blair. William comes Maggie Our [Operator first Nolan

Your line is now open.

what few product a why on I around give the gross you were dynamics that? wanted margins. the to questions that drove a up, you better saw little ask behind mix Can detail more margin

of are Mark. it’s different How couple Maggie, you? A Hey, Sure. things.

we calls, are our We trend blended margins. on services on capabilities. so have as are than services product starting margins our building up, higher are Also services prior annuity the our see mix talked to we up

make margins. in see are So, to our starting a starting difference where to we that’s

as gross product consolidated both as are we excited overall. a services from We margins and are well where pretty about

And of can’t of the couple an can if mix perhaps last you of services give how business changed just that’s in get us that that your over idea detail you much or years?

Okay. Well, we of but a Maggie, added in the of this or XX heads had – services so of XX employees majority customer-facing that we the it of that those space. break the approximately the headcount year. talked that mind. Elaine The to in different added kind keep don’t out, couple were things we was about heads we

We have acquisition. acquisition IDS seen with OneCloud the the and

cloud capabilities build that have our related. We been of lot to able and a is out services

maintenance We that have are our up services solutions managed our portfolio customers looking for. built services and of also enhanced

consultative it’s gross ongoing annuity then So, XXX consultative basis a One those are up gross other which combination services of had the consolidated margins. up margins up were points. driving Sequentially, services, XXX mentioned our that basis upfront points. are and note, thing Elaine to service they

a mind So, we right going trending moving up other that’s affecting the our the to was points keep services on basis looking are feel are for that resellers customers we it for in like XX% to our as the for and to year. two, is is Maggie, lot it in direction customers. the us nicely I up security help it those relates a in think and are ourselves up One security. lot where space from very from that of our we offering some of like quarter and is thing the almost There was XXX

gross in think for fourth you you where a maybe margin at quarter more going range you exited think year do So those you forward? this do that’s the with that all play, normalized dynamics representing

like the at on to some calls margins. that I small a believe at some our you mentioned a time. are that on, at it where where relates margins on customers as as peers, look that prior do there over but There well, we are some large winning play That’s margins end is we also will believe there, Maggie. things we see compared we gross to it to we things very tough big affected have have I if of enterprise actually continue deals strategy are you I land-and-expand annuity. will think high if had that do expansion we our

if one quick one in. just I it then And squeeze understood. can Okay,

additional what You mentioned further you to need to take doing continue the steps optimizing do cost structure, that?

different is of there a Well, couple things.

is So and the our have we believe customers. mind one we with to still that share market ability share grab

won’t acquisitions capabilities bring the map, we of OneCloud made some and cloud noted I back our in really have can we that the earlier, but So, the customers. say that put IDS, our on to capabilities I really us that our expanded

thing we we are of very to in to you going are very tightly. So, key of growth areas if that the continue one invest SG&A we watch The will. cognizant

it. So, we are to going rationalize

note to actually cost. one And that are We headcount XX our can is I is down optimize the going employees sequentially. thing the

will So scale, operating believe are do start over time and we to see some economies we to of it we our watching relates leverage. that as

Great. Well, thank you very much.

Maggie. Thanks,

soon. you see will We

our comes next from you. Sidoti. And of Matthew Thank question Galinko

line is open. Your now

afternoon. good Hey,

Matt. Hi,

typically Mark customer just you kind that turnaround and So, guess see pipeline I on end you it kind services ramp some an the quarter. the products that in if to to do of is subscale this acceleration up and the tag of of touched recovery is disaster for on I being sale and highlighted a being to from deals you generally of and acquisitions? India than how question sell I able acquired acquisition see the think guess those was services to you wondering backup in am quicker I able

Yes.

don’t of one a So, quicker hey, it sale say Matt, you things, can know if if a that, we different couple was I will.

were a nice in think able we is this that the were that provide. we to acquisition up have we to need go actually the able had our customers say over of very service. IDS can that will I was I that that to from in that our space that one we terms service back we with that as rest about interested and picked X,XXX got this roughly customer we customers take of have What’s

how little at much over XX-month that, deal growth, nice are So, still us. a margins. us period that it early our that’s was but to excited will a revenue to to what’s a It’s in the we exciting know incremental cycle add for

we it sell the and services more well of can annuity that over an as we that would service to all go stream to ongoing space of our types will back hope customers now that can that So time. that we sell in other be and customer that take we

Got okay. it,

it So, like would that to adopting on or right adoption something it time it’s was customers be process in seems sorry say, the place, ways. right of or some

So going a the you have sense just X,XXX sense actively whether evaluating with did conversations customers sorts of how you get gotten those are or yet a and the are annuity particularly acquirable? type services

Yes.

this I a were IDS. was for space, where this the good and it So, one to account was can you the from them the what executive knew acquired that that, in for we percentage with have will real relationship of them account over time. had and good looking either to a technology say look they or they able they yes, for I tell customers look won’t will most, solutions match

it. Got

as right deal that necessarily is should sort of question of to be thinking deal XX data sort not for contract the around that mature enough – the of or months that is we Okay. just kind that of last Alright, determine? term

say Yes. say most compared most, months XX deals range, of On the I our Matt. in a annuity little were this I or X-year probably would to extended would that’s

the outliers XX would months So, then time. norm the would think and I be over that’s the

a you Are the chomping are still execution just more pipeline of of so know a to you potential I Got how it. already on Alright, it touched kind is bit little for deals have? kind around on there? but you what mode maybe in you of speak M&A, more or consolidation one bit, it

We are looking, always Matt.

part will So, continue you of footprint. expand is to corporate our our objectives to if

about us out can on do opportunities board we hard on equal them to and get how on no of company shortage so is and there they offerings to one everything the ensure we of one try day X pretty an example companies will into then will. and We once bring they So, all I for there acquire. if of potential the it. give and about ePlus hopefully you ePlus understand three go that you that track integrate

IGX So, if Matt, did England you acquisition in footprint gave the our us the look was that we but Northern reseller X security ago, importantly, presence, New UK. a out that as at years a just about built that

have have we added done we we hired have got Cisco and management, noted is Gold what sales reps, sales then the we Now, since we that service certification.

ability we provide and that well to base that not this just us base have the now nice is we and their multinational UK, used supporting technology the Atlantic. customer potential only to what’s but Cisco let’s as across about say new as the customers net the that to Europe ability do So, are customer have in then in our example, to it

example coverage revenues ways, the customers time. we we we Europe of So, UK, kind our expand is for look expertise acquisitions over build can lot in technical Continental gave up that territory just support to our give different we will us the a then a can that and I and you in hey, and multinational it of helps

Got it. Alright, thank you.

Alright. Thanks, Matt.

see will soon. you We

next [Operator from question Matt you. comes Stifel. Instructions] Our Thank with Sheerin

open. now is line Your

least last some volume pressure right. looks volume like question in to about Yes, And of lower comps and positive, you so sales wouldn’t or didn’t couple couple that going it big quarters security impact on thank you some hello with deal? that, the customer from you. rolled I the that big about, the margins fact big so quarters, gross that also and the know that case know that Mark, past at Did but next another of helped tough this customer margin margin, unless putting deals the are big that, like talked the have for off on and you and bumped quarter, that’s volumes have of everyone. for I along Matt, that up have next the services you largely have the behind be

Yes.

One, things. couple next quarters of yes, different the will on little a of this couple the bit for us a run-off. Matt, So, affect project

thing up sales other were GP tough The year up so was is as and noted last our a it XX%. the XX% was compare, you net

thing X.X%, which almost in up without security could the though won’t the up note building and this those doubt, are many hard growth affect X% Yes, a services, annuity tell have you the time pop seen forward on about to doing, so the similar we or we year. deals have security the margins. GP cloud, in previous say the up in that Do growth, thing is kind of was to pipeline I the you other solutions to though really calls that it think think could digital What a helped up we margins given is going quarter got it again that consultative year margins? stressed there in building on So our a building any out our and XX% is and I have our capabilities. been noted have on I have our we

call that the trend low and at big would So, those can’t competitive value-add that we are customers that deal we solutions the another that’s services into. I’d for are margins may what looking to up, would hope looking that want I on future for our you are predict get but

Okay.

your trying security to as and You and the services but well XX%, else representing security related am talked what about tied is I was and at there? get security percentage what to of services because that are

Matt. you, breaches. highlight here won’t been tell there what pretty some I problems, few things Yes, I has would a significant data is is There but and others

$X from billion billion. WannaCry about was loss to that $X.X If the on you think supposedly anywhere

that customer based have on go built we and solutions roadmap. back both help to build able the and security been them security we base up it’s So, our expertise services product of their and kind into the

almost why I are that’s seeing So QX. XX% think in a growth you

XXX areas, year basis nice a we and our point the in XX% are space. You jump the for grew a a jump security year-over-year but any of in one that’s seeing nice almost is that

Okay, CapEx how or up have U.S. they great. you it spending, about place them and is put that types they on you feedback just whether any about more that prompting customers reform business of not things? feel to tax in and those stepped the their And terms then getting of side, in the a sounds good pipeline having both pretty are side services like transaction from talked on

the maybe can these you as the are am believe customers optimistic rarely tell our heard ePlus economy with say you is we looking to for. any the for of we tax here we hey, benefit I from what on I of build both up we are I are infrastructure well customer Matt. some do as are visiting are are I tell I tax a customers what on they terms the What hearing we take and spending. have from benefits, seeing pipeline helping can based doing. of in what the there and benefits cautiously looking overall benefit, as tax that we what

So scale thinking we can and it are same company be bigger scale the assume thing. or companies other will as I would we a

technologies? converged and you highlighted And areas Okay. weakness strength other some could those the storage talk transition all-flash specifically you maybe areas networking and of about arrays product you and then security, seeing types in that some of but highlight the some didn’t you of to are the

Yes.

a of things. So, couple different

A still of As it space. storage. driven seeing nice growth are we in by relates storage, to the flash it’s lot

good it like a that the is are of they relates CatXk, players solutions the with of large with in the what as and some so with lot opportunity hyper-converged major OEMs Nutanix have a interest XXXX in There networking the space Cisco We series. getting that space. call in

base can CatXk X upgraded is and series X of that there CatX, a call this be I’d to huge refreshed series. up or So

technologies there. well advanced as some there So, there some that is upside opportunity add-on And a expansion. is and as with nice technology, sales

So, there things, bigger Those be the would is an opportunity there. Matt.

space, means more space in the of the some over IoT, plays, as analytics IoE or will going the and we if lot towards play. time from data move lose you you, what the analytics intelligence think I security start are customers Did digital as seeing well a plays, both you to Matt? On a that a artificial more digital as from

the million regarding last sorry. just also somewhat? does where only lowered I have of gross the actually business margin is year, would gross the last in Yes, an think on said $X.X change recognition, And which impact question leasing you you margin revenue

impact. wouldn’t number. pretty it’s an No, it have mean, I small

Okay, so no impact, okay.

much. very thanks Okay,

Alright. Take Matt. care,

this Marron to further turn Mark any back Thank now you. I any showing call am to the time. further I remarks. like over for And at would questions not

to our see your our I as good like Okay. and would well next gross everybody thank want you Thanks, gross holiday areas an could it margins profit about as that still will I family our call care. I Daniel. we us are are and focused We everybody joining close call. wish we enjoyable the building and on that, feel the we friends and Hey, long-term just on in today. strategy need. Take season what our customers very to one, with for if the and on shows With

you. Thank

conference. program Ladies and you a have day. for in gentlemen, all participating today’s Everyone, wonderful and disconnect. conclude does thank you This may today’s