BCP Investment Corporation - Q4 2022

Transcript

Operator (participant)

Welcome to Portman Ridge Finance Corporation's fourth quarter and full year 2022 earnings conference call. An earnings press release was distributed yesterday, March 9th, after market close. A copy of the release, along with an earnings presentation, is available on the company's website at www.portmanridge.com in the Investor Relations section, and should be reviewed in conjunction with the company's Form 10-K filed with the SEC. As a reminder, this conference call is being recorded for replay purposes. Please note that today's conference call may contain forward-looking statements, which are not guarantees of future performance or results and involve a number of risks and uncertainties. Actual results may differ materially from those in the forward-looking statements as a result of a number of factors, including those described in the company's filings with the SEC.

Portman Ridge Finance Corporation assumes no obligation to update any such forward-looking statements unless required by law. Speaking on today's call will be Ted Goldthorpe, Chief Executive Officer, President, and Director of Portman Ridge Finance Corporation, Jason Roos, Chief Financial Officer, and Patrick Schafer, Chief Investment Officer. With that, I would now like to turn the call over to Ted Goldthorpe, Chief Executive Officer of Portman Ridge.

Ted Goldthorpe (CEO, President, and Director)

Good morning. Thanks, everyone, for joining our fourth quarter and full year 2022 earnings call. I'm joined today by our Chief Financial Officer, Jason Roos, and our Chief Investment Officer, Patrick Schafer. I'll provide brief highlights on the company's performance and activities for full year 2022. Patrick will provide commentary on our investment portfolio and our markets, and Jason will discuss our operating results and financial condition in greater detail. Yesterday, Portman Ridge announced its fourth quarter and full year 2022 results, and we are pleased with the solid earnings power of the company despite operating under difficult market conditions, a challenging economic environment, rising interest rates, and market volatility.

Our core investment income in 2022 increased by $800,000 to $64.2 million in comparison to $63.4 million seen in 2021 as we continue to see the impact that rising rates have in generating incremental revenue from our sourced investments. Our amended and extended credit facility with JPMorgan Chase has reduced our cost of capital, helping further reduce our expenses relative to our asset base. Our performance both this quarter and earnings momentum from the timing lag and a realization of rising benchmarks has allowed us to raise our dividend for the second straight quarter to $0.68 per share. We believe that we were situated to continuing delivering attractive returns to our shareholders in 2023.

Regarding our primary market as a whole, despite the continued volatility in the syndicated markets and an uncertain macro backdrop, we remain bullish on new investment opportunities and the ability to rotate our portfolio at reduced risk and incremental returns. For new opportunities, spreads have widened by approximately 150-200 basis points as compared to the beginning of the year, and upfront fees are an incremental 100-200 basis points. Additionally, we continue to see strong equity contributions from sponsors and reduced leverage levels. To illustrate this, the weighted average total leverage of deals we completed in the fourth quarter was 4.8x as compared to 5x in Q3 and 5.5x for all of 2022.

Turning the focus back to the company, we continue to believe in the valuation of Portman Ridge as we continued repurchasing shares under our renewed stock repurchase program. In 2022 alone, we repurchased a total of 167,017 shares at an approximate cost of approximately $3.8 million, more than double the amount of shares we repurchased in 2021 at 75,377 shares. We expect this trend of repurchasing Portman shares to continue into 2023 as we're able to do so. On this call, Patrick will also walk through the potential upside cases for net asset value. Our portfolio is largely in first lien debt and is now valued at a significant discount to par.

If we experience normalized defaults or even elevated default rates versus history, we believe there is embedded net asset value upside in the portfolio. This adds to our earnings momentum, driven by wider spreads on new originations and rising short-term interest rates to derive both potential NAV and earnings upside. With that, I will turn the call over to Patrick Schafer, our Chief Investment Officer, for a review of our investment activity.

Patrick Schafer (Chief Investment Officer)

Thanks, Ted. Turning to slide five of our presentation and the sensitivity of our earnings to interest rates. As of December 31, 2022, approximately 90% of our debt securities portfolio were either floating rate with a spread to an interest index such as LIBOR, SOFR, or Prime, with 67% of these still being linked to LIBOR. As you can see from the chart, the underlying benchmark rate of our assets during the quarter lagged the prevailing market rates and still remain significantly below the LIBOR and SOFR rates as of February 28, 2023. We would expect this to normalize over time as the underlying one-, three-, and six-month contracts reset.

For illustrative purposes, if all our assets were to reset to either a three-month LIBOR or SOFR rate respectively, we would expect to generate an incremental $2 million of quarterly income. While our liability cost will also rise relative to their Q4 levels, we still expect a net positive benefit of approximately $0.10 per share, assuming all of our assets and liabilities are utilizing the same three-month benchmark rates for an entire quarter. Skipping down to slide 11. Both investment activity and originations for the fourth quarter were lower than the prior quarter, resulting in net deployment of approximately $6.3 million, excluding regularly scheduled quarterly amortization payments and fundings under previously committed facilities, including our Great Lakes joint venture. Net deployment consisted of new fundings of approximately $23.8 million, offset by approximately $16.5 million of repayments.

These new investments are expected to yield a spread to SOFR of 704 basis points on the par balance. The investments were purchased at a cost of approximately 95.5% of par, which will generate incremental income in addition to the stated spread. As mentioned in our press release, we drew $14.3 million under our 2018-2 Secured Notes at a rate of LIBOR plus 158 basis points to fund these assets, yielding SOFR plus 704 basis points, resulting in a very attractive return on equity. During the quarter, we funded $13.7 million into our Great Lakes joint venture and have had additional funding so far this year that have in aggregate taken us close to being fully funded under that commitment.

Similar to our experience with new assets on the balance sheet, incremental investments in our Great Lakes joint venture have come at increasing spreads and widening OID, which should result in higher returns going forward. Our investment securities portfolio at the end of the fourth quarter remained highly diversified, with investments spread across 31 different industries and 119 different entities, all while maintaining an average par balance per entity of approximately $3.3 million. Turning to slide 12. We had one incremental investment on non-accrual as compared to September 30, 2022, which is a subordinated note in prior holdings, which is valued at zero. In aggregate, investments on non-accrual status remained relatively low at four investments in the fourth quarter of 2022, as compared to seven investments on non-accrual status as of December 31, 2021.

These four investments on non-accrual at the end of 2022 represent 0.0% and 0.6% of the company's investment portfolio at fair value and amortized cost, respectively. On slide 13, as Ted mentioned in his opening remarks, if we focus on the top three rows of the table, we have an aggregate debt securities fair value of $475.3 million, which represents a blended price of 91.66% of par value and is 84% comprised of first lien loans at par value. Assuming a par recovery, our December 31st, 2022 fair values reflect a potential of $43.2 million of incremental NAV value or $4.51 per share.

For illustrative purposes, if you were to assume a 10% default rate and a 70% recovery rate on this debt portfolio, there would still be an incremental $2.89 per share of NAV value over time as the portfolio matures and is repaid. This default rate is above anything the market is expecting or has experienced historically. Turning finally to slide 14. If you aggregate these three portfolios over the last threeyears, we have purchased a combined $434.8 million of investments, have realized over 2/3 of these positions at a combined realized and unrealized mark of 103% of fair value at the time of closing the respective mergers.

We're able to achieve those results despite the global pandemic in 2020 and most of 2021 and a weak market for almost all asset classes in 2022. In a similar vein as the previous slide, as of December 31, 2022, there remains an incremental $13.7 million of value as compared to the par in these portfolios, or $9.3 million when applying a similar 10% default rate and 70% recovery rate analysis. I'll now turn the call over to Jason to further discuss our financial results for the period.

Jason Roos (CFO)

Thanks, Patrick. As both Ted and Patrick previously mentioned, despite operating under a challenging economic environment, our results for both the fourth quarter and for the full year 2022 reflect strong financial performance. Total investment income for the full year 2022 was $69.6 million, of which $55.8 million was attributable to interest income from the debt securities portfolio. This compares to total investment income for the full year 2021 of $80.1 million, of which $65 million was attributable to interest income from the debt securities portfolio. The decrease was largely due to lower purchase price accretion reflected in 2022, as well as reduced repayments along with lower fee income.

Excluding the impact of purchase price accounting, our core investment income for the year was $64.2 million, an increase of $800,000 as compared to core investment income of $63.4 million in 2021. Our net investment income for the full year 2022 was $28.9 million or $3 per share, which compares to $42 million or $4.92 per share for the full year 2021. The year-over-year decrease was largely due to the aforementioned impact of reduced purchase accretion, lower repayment activity and reduced fee income. As of December 31, 2022 and December 31, 2021, the weighted average contractual interest rate on our interest-earning debt securities was approximately 11.1% and 8.1%, respectively.

We believe the portfolio remains well positioned in a rising rate environment to generate incremental revenue in future quarters. Total expenses for the year ended December 31, 2022 were $40.7 million compared to total expenses of $38.1 million seen in the full year 2021. This was predominantly driven by rising costs associated with the interest expense on our debt. One item to note is that we continue to see reduced expenses related to administrative services and other general and administrative costs, a trend we are looking to maintain in 2023.

Our net asset value for the fourth quarter 2022 was $232.1 million or $24.23 per share, as compared to $251.6 million or $26.18 per share in the third quarter of 2022. The decline due to our debt and equity securities was driven primarily by mark-to-market movements within our portfolio. On the liability side of the balance sheet, as of December 31, 2022, we had a total of $378.2 million par value of borrowings outstanding, comprised of $92 million in borrowings under our revolving credit facility, $108 million of [4.875]% notes due 2026, and $178.2 million in secured notes due 2029.

This balance represents a quarter-over-quarter increase of $9.2 million relating to a draw on our secured notes of $14.3 million, offset by a $5.1 million repayment on our revolving credit facility. As of the end of the quarter, we had $28.9 million of available borrowing capacity under the senior secured revolving facility and no remaining borrowing capacity under the 2018-2 revolving credit facility as the reinvestment period ended shortly after our draw on November 20, 2022.

Additionally, as pointed out in our previous earnings calls, we successfully refinanced our senior secured revolving credit facility in April, which changed the benchmark interest rate to three-month SOFR, reduced the rate of interest margin to 2.8% per annum from 2.85% per annum, and extended the maturity of the facility to April 29, 2026. As of December 31, 2022, our debt-to-equity ratio was 1.6x on a gross basis and 1.5x on a net basis. From a regulatory perspective, our asset coverage ratio at quarter end was 160%.

This is at the high end of our target range, driven by the drawing of the remaining capacity under the 2018-2 revolver in advance of its expiration in the fourth quarter of 2022. Lastly, as announced yesterday, a quarterly distribution of $0.68 per share, which represents an increase of $0.01 from prior quarter levels and an increase of $0.05 from levels seen in the first quarter of 2022, was approved by the board and declared payable on March 31, 2023 to stockholders of record at the close of business on March 20, 2023. The latest increase of $0.68 also represents two consecutive quarters of stockholder distribution increases and the fourth stockholder distribution increase over the last six quarters.

This increased quarterly distribution is supported by the fourth quarter strong financial performance and our expectations for similar financial performance to continue in future quarters. With that, I will turn the call back over to Ted.

Ted Goldthorpe (CEO, President, and Director)

Thank you. Ahead of questions, I'd like to reemphasize that we believe we are well-positioned to take advantage of the current market. Through our prudent yet selective investment strategy, coupled with our emphasis on cost management, we anticipate that we will be able to generate strong returns for our shareholders in 2023. Thank you once again to all our shareholders for your ongoing support. This concludes our prepared remarks, and I'll now turn the call over to the operator with any questions.

Operator (participant)

At this time, if you'd like to ask a question, simply press star one on your telephone keypad. Our first question will come from the line of Christopher Nolan with Ladenburg Thalmann. Please go ahead.

Christopher Nolan (Senior VP and Managing Director of Equity Research)

Hey, guys. The leverage ratio is high. What's the anticipation going forward in terms of maintaining that level or bringing it down? What's the current target leverage range?

Patrick Schafer (Chief Investment Officer)

Hey, Chris. It's Patrick Schafer. I think our target leverage range kind of remains what we stated before, which is 1.25-1.4. We're a little bit above that at 1.5. I think, again, as mentioned, we intentionally drew up our revolver, which brought us a little bit above our leverage range given that it was terming out and it's a particularly attractive financing at LIBOR plus 158. We would expect over the course of this year to have leverage decline back into kind of what we would think of our target range is, kind of something below 1.4x net.

Christopher Nolan (Senior VP and Managing Director of Equity Research)

Okay. Thanks, Patrick. As a follow-up question, Silicon Valley Bank is in the news today. I know it's a quickly evolving situation, but, you know. Are you guys trying to figure out in terms of any of your portfolio companies have or their sponsors may have, exposure to Silicon Valley in terms of significant deposits there? I know it's early days and it's a fast-moving situation, but, you know, any perspective would be welcomed.

Ted Goldthorpe (CEO, President, and Director)

Yeah. Anytime something like this happens, you know, we're always very focused on the knock-on effects. You know, we called and spoke to a number of our portfolio companies both last night and this morning. I think it's a little too early to assess. Obviously, you know, there will be some flow-through effects on certain tech businesses given they're a big lender there as well as a hold a lot of the cash. We're looking at other knock-on effects too in terms of, you know, if they're having to sell securities at big discounts, you know, how does that ripple through the rest of the financial markets?

I would say if you look at our portfolio, we think, again, we don't think this is gonna... As of right now, we don't think this is gonna have really any material impact on our portfolio, unless there's, you know, other unforeseen things that happen because of it.

Christopher Nolan (Senior VP and Managing Director of Equity Research)

Okay. That's it for me. Thanks, guys.

Operator (participant)

Again, for any questions, please press star one. Your next question will come from the line of Ryan Lynch with KBW. Please go ahead.

Ryan Lynch (Managing Director of Equity Research)

Hey, good morning. First I just wanted to hop into kind of what happened quarter-over-quarter regarding interest income as well as investment income as well as interest expense. If I look at core investment income, it only increased about $100,000 from $17.6 million to $17.7 million. Meanwhile, and also looking at your slide as far as, like, accelerated fees, I know those were a little bit lower in the quarter, but I think that was only maybe a couple of hundred thousand dollars lower versus Q3. That was only a few hundred thousand dollar headwind. Meanwhile, interest expense went up by over $1 million.

I was just wondering if it's... I understand that there's a lag from the positive impact of rising rates. That same lag impacted third quarter numbers, effectively, where we are, we're always on a lag. Quarter-over-quarter, it feels like we should be moving up the, you know, the generally the same amount. I was just curious on why the lack of movement in investment income this quarter relative to where rates went, where rates really moved in the third quarter, which would have then mostly impacted your fourth quarter numbers?

Patrick Schafer (Chief Investment Officer)

Yeah. Hey, Ryan. Let me just start quick. This is Patrick. Let me start quickly on the timing. Particularly for Portman, our CLO, which is not the bulk, but is over 50% of our floating rate liabilities, resets in the middle of the quarter, specifically reset at the end of November. We are on a bit of a different cadence where the majority of our liabilities on a floating rate reset during the quarter. Depending on when the actual Fed rate hikes are over the course of a period of time, we can get a bit of a mismatch there because of the timing of that reset.

Again, when you kind of roll it forward and we discussed, and we show in our presentation kind of the $0.10 on a run rate basis, there's not a significant amount of further increase in our liabilities because of where they were reset to during the fourth quarter. That's why we specifically highlighted some of the timing differences. I'll turn it over to Jason to kind of go through some of the income numbers themselves. I just wanted to throw that out there on the timing. We have a bit of a unique situation because of when a big chunk of our floating rate liabilities reset.

Ryan Lynch (Managing Director of Equity Research)

Okay. Yeah.

Jason Roos (CFO)

Yeah. There's some netting impacts happening there. If you look at quarter-over-quarter, you know, you see purchase accretion kind of running off at a clip of about $500,000. That's a piece of income that has to be offset with the interest raised throughout the quarter. If you look at pure interest, we're up well over, you know, $1.2+ million quarter-over-quarter on the interest alone. That's offset a little bit by that accretion I was mentioning. Fees quarter-over-quarter, slightly down, call it $200,000 to closer to $270,000 for the quarter. CLO income was down. We can talk more about that. Those are some of the drivers, really just offsetting, to get to a net, increase quarter-over-quarter on that investment income.

Ryan Lynch (Managing Director of Equity Research)

Yeah. Why was CLO income down so much quarter-over-quarter? Is that a good quarter run rate? Is that a good run rate to expect going forward?

Jason Roos (CFO)

Yeah. Yeah. The CLOs, you know, are on a the accounting model for that is a beneficial interest method. As you reset your basis in the assets and you calculate your IRR over the life of the future cash flows, as those cash flows move around, your IRR will change, which drives your yield. That's what drives your interest income on those CLOs. As a result of the embedded cash flows, that future cash flow expected stream decreasing, just given the market environment we're in, that yield is coming down, which is what's driving the reduction in that yield.

Patrick Schafer (Chief Investment Officer)

Yeah. The shorthand there is the actual price of the CLOs that are marked at has an impact on what we recognize from a revenue perspective. The marks on CLOs being down quarter-over-quarter lead to less revenue being recognized. It's not necessarily a cash flow from the securities being down necessarily. In theory, if we were to mark up the CLOs next quarter, you would see a increase in the revenue, roughly speaking, because of that. It's a little bit more of a revenue recognition as opposed to underlying cash flows of the CLOs.

Ted Goldthorpe (CEO, President, and Director)

Yeah, I think it's, I think it's fair to say, and the same thing happened in 2020 and other periods of time, but I think the third party, valuation firms changed their methodology around how they account for CLOs in terms of, you know, how they view defaults and future defaults. And so they, you know, they made a change in the fourth quarter, which obviously had an impact not only on income but also on valuations.

Ryan Lynch (Managing Director of Equity Research)

Okay. Gotcha. The other question comes to, you talked a little bit about them in your prepared remarks, just the net portfolio losses that were recorded in this quarter and really the last couple quarters, you know, driving kind of the decline in NAV. I know last quarter you talked about. It sounds like a lot of it is mark-to-market, but they've certainly been outsized relative to other BDC marks. I know you can't comment on how other BDCs are marking their portfolios. I also can understand that when I look at non-accrual specifically, they haven't increased significantly. That is one indicator that credit, you know, at least from a non-accrual default standpoint, hasn't increased meaningfully.

Still, the declines in your portfolio, the markdowns have been well outside the normal range for what we've seen in BDC. It feels like there's something more going on besides mark-to-market. Can you talk about that and why have those markdowns been so large, and what you're expecting? I mean, if it is just mark-to-market, those will eventually theoretically recover, depending on how, you know, market conditions play out over time. It's just they're really outside relative to other BDCs.

Ted Goldthorpe (CEO, President, and Director)

I mean, it's obviously something that we, you know, if you think about just take a huge step back, right? If you think about what happened with markets last year and where comparable indices were last year and were levered, you know, we're not really a big outlier vis-à-vis the overall markets. We are an outlier vis-à-vis the BDC sector. I can't speak to other people's policies but, you know, 84%— we are not seeing a market increase or decrease in credit quality. Our average, you know, as Patrick mentioned his remarks, you know, 84% of our debt is first lien debt, and our average debt mark is at 91, 91.6.

You know, we, you know. I hear what you're saying. By the way, we obviously look in the mirror every single day. By the way, we look at our peers' earnings as well. Again, if you look at where our valuations are vis-à-vis market indices, I would say, you know, we feel that the— Like, you know, you can shock our portfolio in lots of different ways. You can add a very elevated default rate to this. There still should be a pretty big upside to our NAV. Again, I'm not gonna comment on broad valuation policies. I would say we believe our NAV declines are largely temporary and mark-to-market in nature. I mean, obviously, there's always credit-specific stuff. You know, our non-accruals today at fair value are zero.

I would say our, I hear what you're saying, actually, and I, you know, it's something that obviously we talk a lot about internally here. Obviously, we always wanna be conservative on valuations and adhere to our valuation policies.

Patrick Schafer (Chief Investment Officer)

Yeah. Ryan, the two other minor small points I would add is, perhaps unlike some other BDCs, we do have a little bit of a chunk of a liquid portfolio that has a lot more true kind of mark-to-market as opposed to, like, third-party valuation type of marks. Obviously, the volatility in the syndicated markets and kind of where that market is has had, you know, perhaps a slightly disproportionate impact on kind of our fair value relative to perhaps another BDC that really doesn't have any level two assets.

Then the second thing I would say is, again, not to get into general people's investment, sorry, valuation policies, you know, we do have a decent reliance on the actual liquid benchmarks and the yields of those benchmarks. again, perhaps that does lead to a little bit more volatility on mark-to-market perhaps relative to others if they're not using kind of, you know, CS Leveraged Loan Indices from a yield perspective.

Ryan Lynch (Managing Director of Equity Research)

Yeah. I mean, I guess I'm just looking at, you know, versus the Credit Suisse, I'm looking at, you know, LCDs, you know, the average flow name bid is at 97. You know, I certainly appreciate the potential conservatism in your book if you guys have your first lien marked at 91. I would also ask, I guess, why is it marked down that low to that level of conservatism when I don't see that in broad liquid indices, in leveraged loan indices, and I don't see other BDCs marking it down at that level? What drives that level of potential? You know, we'll find out over time if that's just conservatism in that overall mark.

Ted Goldthorpe (CEO, President, and Director)

Yeah. I mean, I think that 97 number is a today figure. Again, these are 12/31 marks. When you look at our liquid industry benchmarks, and again, post SVB, we'll see if this changes. You know, obviously, we've had a pretty big rally in credit for the first three months of this year. If you look at the benchmarks we use to value our portfolio, they're tighter today, meaning the spreads are tighter, meaning prices are higher than they were at 12/31. You've had a pretty big rally in credit, and you've definitely had a big rally in floating rate debt because obviously this higher for longer has put a real floor under loan valuations.

Obviously, you know, the vast majority of our portfolio is floating rate loans. The number you're using... Like, again, like, if we were gonna value our book today and use the indices today, you know, obviously the NAV would look different.

Patrick Schafer (Chief Investment Officer)

Yeah. Ryan, the only thing I'd say, again, happy to follow up offline. I mean, we use a again, part of what we use is a broad Credit Suisse Leveraged Loan Index that I'm literally pulled up and looking at right now. As of year-end, the average price in that index was 91.9, not 97. Like I said, I'd be happy to sync up afterwards. It's a publicly available industry that is part of what makes up our valuation process. The 97, again, I'm not sure that's or that's apples to apples.

Ted Goldthorpe (CEO, President, and Director)

The last thing I'd say, again, we don't want to get all high and mighty about our valuation policies because, you know, everybody can speak for themselves. The other back testing we do for our Board is we look at every single realization and where it was valued beforehand and where it was realized. I think across. It's basically like a 100% hit rate for the last couple of quarters on our realizations are at higher values than we were valued. I mean, it just shows. It's for us to provide comfort to the Board that our valuations are, generally speaking, conservative.

Ryan Lynch (Managing Director of Equity Research)

Yeah. I guess, you know, what we're trying to do as outsiders looking in is just figure out. You know, if something is just conservative, then that's fine. I guess, you know, from an outsider looking in, we're trying to figure out these outsized moves in your portfolio's NAV or, you know, and the portfolio decline as well as the NAV decline. Is that credit or is that mark-to-market? There's probably a combination of both of them, given what's going on in the market today with just broadly deteriorating credit quality across this. I think that's the biggest focus right now for investors, particularly the sort of the outsized move to NAV, just trying to navigate that. I appreciate, you know.

Ted Goldthorpe (CEO, President, and Director)

No, I honestly, I agree with everything you're saying. Yeah, I read your note last night too. Like, I agree with all that. As it's frustrating because we feel like our business is doing really well, and we feel like we're really not seeing— I mean, I'm not saying— We will have credit issues, as will everybody.

We have an incredibly diverse portfolio. You know, we've got— Like, so there's not, like, one name that can really have a huge impact on our business. You know, again, non-accruals are basically zero. You know, I just look at the broad loan indices last year and see BDCs reporting flat to flat NAV. I, just to me, I mean, I won't comment on others, but I would just say I don't think our numbers are wildly off where, you know, benchmarks are. I can't— You know, that's— What you're saying is the same question, you know, we ask ourselves as well. You know, 'cause I would be— If I was a shareholder, I'd be asking the same question.

I mean, the counter to all that is, you know, obviously we're buying back our stock. We raised our dividend for the fourth time. You know, my guess is we'll have continuing dividend increases as this timing and lag issues normalize. You know, again, we're pretty optimistic for earnings this year.

Ryan Lynch (Managing Director of Equity Research)

Okay. I got you. Thanks for the dialogue. That's all for me today. I'll hop back in the queue.

Operator (participant)

Once again, for any questions, press star one on your telephone keypad. We have no further questions at this time. I'll hand the conference back over to management.

Ted Goldthorpe (CEO, President, and Director)

Great. Thank you, everyone, for joining us today, and we look forward to speaking to you all in early May when we'll be announcing our first quarter 2023 results. Thank you very much.

Operator (participant)

Ladies and gentlemen, that will conclude today's meeting. Thank you all for joining. You may now disconnect.