LendingClub - Earnings Call - Q4 2020

Transcript

Operator (participant)

Good afternoon and welcome to the LendingClub Fourth Quarter and Full Year 2020 Earnings Call. All participants will be in listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star, then one, on your touch-tone phone. To withdraw your question, please press star, then two. Please note this event is being recorded. I would now like to turn the conference over to Sameer Gokhale, Head of Investor Relations. Please go ahead.

Sameer Gokhale (Head of Investor Relations)

Thank you and good afternoon. Welcome to LendingClub's fourth quarter and full year 2020 earnings conference call. Joining me today to talk about our results and recent events are Scott Sanborn, CEO, and Tom Casey, CFO. Please note that in addition to the presentation we usually provide with our quarterly results, we are also sharing a LendingClub Bank presentation that provides information about our business, including our new banking capabilities. You can find both presentations accompanying our earnings release on the Investor Relations section of our website. Our remarks today will include forward-looking statements that are based on our current expectations and forecasts and involve risks and uncertainties. These statements include whether or not the business is to grow, future products and services, the effectiveness of certain strategy initiatives, anticipated financial results, and the impact and benefits of the latest acquisition and resulting bank charter on our business.

Our actual results may differ materially from those contemplated by these forward-looking statements. Factors that could cause these results to differ materially are described in today's press release and our most recent Forms 10-K and 10-Q, each as filed with the SEC, as well as our subsequent filings made with the Securities and Exchange Commission, including our upcoming Form 10-K. Any forward-looking statements that we make on this call are based on assumptions as of today, and we undertake no obligation to update these statements as a result of new information or future events. Also, during this call, we will present and discuss both GAAP and non-GAAP financial measures. The description of non-GAAP measures and reconciliation to GAAP measures are included in today's earnings release and related slide presentations. The press release and accompanying presentations are available through the Investor Relations section of our website at ir.lendingclub.com.

I'd like to turn the call over to Scott.

Scott Sanborn (CEO)

Thank you, Sameer. Good afternoon, everybody, and thank you for joining us today. We are very excited to share the update on our business now that the acquisitio n of Radius is complete. We have worked long and hard to get to this point, and we are very bullish about how we are positioned to add value to our customers and deliver consistent and sustained multi-year earnings growth for our shareholders. It is really hard to imagine a better time to be launching a digital bank. We have got a lot of information to share today, and the financial expression of our business will be changing considerably. Tom and I are going to split this up.

I will focus my time on how the addition of the bank enhances our business and enables us to deliver on our strategy, and I'll let Tom provide the details on last quarter's results and how the acquisition informs our financial outlook for the year. When we launched back in 2007, LendingClub's vision was to leverage technology, data, and our marketplace model to transform the banking industry. We began by bringing a traditional credit product, the installment loan, into the digital age, moving it online, broadening access, lowering costs, and delivering a fast and frictionless experience.

We redefined the category, and by 2019, personal loans were the fastest-growing segment of consumer finance, and we became the largest personal loan company in America, generating more than $1 billion in loan volume per month and helping more than 3 million customers lower their cost of credit and get on the path to eliminating their credit card debt. Getting out of debt is, in fact, our members' number one goal, and they love us for what we're doing for them. Our NPS score is approaching a truly outstanding 80. That is well above many leading brands and traditional banks. The pandemic has demonstrated that they prioritize our loans above many of their other debt obligations, including even credit cards.

Half of them returned to us again within five years, providing us a virtually free source of loan volume, which we reward with a further simplified process and even lower rates compared to their first loan. Easy access to responsible, low-cost, unsecured credit is a primary pain point for our members, and it represents a huge, immediately addressable market that's expected to grow at more than 20% annually over the coming years. It is not the only pain point, and our mission to empower our members on their path to financial health does not end here. Of note, our customers are not the underbanked or those shut out of the financial system. These are high-income, highly credit-worthy individuals who are already fully utilizing bank services. In fact, they are some of retail banking's most profitable customers. It is just working out better for the banks than it is for them.

That's because, together with their higher-than-average income, they also have higher-than-average debt, including credit card, auto, and student loans. They want to put this debt behind them, and they are highly motivated and willing to take action to get there. As a digital marketplace bank, they can now do so much more to help. Our members tell us they are ready and eager for us to do so. In a recent survey, 83% said they're interested in more products and services from LendingClub. With the digital bank acquisition closed, we can take the next step. First up, we'll be building on Radius's multi-award-winning online and mobile deposit offering to make it very easy for our customers to manage their lending, spending, and savings in a holistic fashion.

Because we're vertically integrated, we can capture more value both from lending and from spending and can use this together with the behavioral data we'll be collecting to offer powerful benefits and value to our customers. This sets LendingClub apart from the neo-bank and fintech competition. What's even more exciting is that the bank is being added to an already formidable platform with two sizable benefits. First, as you can see on slide nine of the LendingClub Bank presentation, we have incredible data superiority. We have 14 years of history on $60 billion in loans to millions of customers informed by rigorous testing, resulting in 140 billion data cells added to our proprietary database. Access to this vast amount of data gives us a significant competitive advantage.

Our team of more than 130 data analysts and scientists mine this historical data with leading-edge machine learning and AI analytic techniques to continuously refine our dozens of proprietary models to optimize fraud risk, repayment risk, loan exposure, and loan pricing. It is working. Our experience shows that our proprietary scoring system is 20 times more effective than traditional credit scores such as FICO at predicting default. As a result, we can approve more borrowers, offer significantly lower interest rates, and price competitively for attractive risk-adjusted returns across the credit spectrum. Benchmarking data from one of the leading online aggregators shows that our loan offers are priced very competitively and are very likely to be ranked as best in class. Several independent studies, including those conducted by the Philadelphia Federal Reserve researchers, confirm our ability to make credit more affordable than traditional alternatives.

Coming out of the pandemic, the strength of our underwriting has now also been cycle-tested. Losses on loans issued pre-COVID are in line with our pre-pandemic expectations, and loans issued since the pandemic are some of our best-performing loans in recent years. We have not just collected a wealth of data; we are leveraging it, and it is clearly giving us an edge. Another key differentiator is our technology infrastructure. Our tech team encompasses nearly 400 LendingClubbers. We build proprietary software and systems that enable us to deliver seamless, highly automated access to credit and deliver a fantastic customer experience. We have issued 13 patents and have 27 pending. It would take others many years and a significant capital outlay to try and replicate the competitive moat that we have created.

With the acquisition of Radius, we're adding to our competitive advantages by evolving to a unique and powerful new business model: a marketplace bank. As you can see on slide 10, this model wins against both traditional banks and against fintech marketplaces. Versus banks, we expect to grow more rapidly, fueled by the combination of interest income from our high-earning assets together with significant fee-based income from our capital-light marketplace. We'll be even more efficient at customer acquisition, supported by our national footprint and our ecosystem of funding partners that allow us to serve a broader range of customers than a typical bank. We will be highly adaptable at a lower operating cost as a digital-first entity unencumbered by legacy tech infrastructure or high-cost branches. We also have advantages over pure fintech marketplaces, the limitations of which we understand better than anybody, and that's why we've evolved our business model.

Versus fintech marketplaces, our marketplace bank will be more resilient, with access to stable functions, a recurring and sustained revenue stream, and a clear and established regulatory framework. We will be able to reach higher profitability given our lower funding costs and higher earnings per loan. All of these advantages position us well to capitalize on a clear trend that has been accelerated due to COVID: the move to digital banking. Bank is no longer a place you go; it is a thing you do, increasingly from your mobile phone, and consumers are now more than ever weighing the importance of that experience versus proximity to a bank branch. With one of the best mobile experiences in the industry, we are starting from a good place here.

I've been with LendingClub for more than 10 years, and I have never been more excited about the combination of capabilities and market conditions for us to achieve our ambitions and transform the industry. Our marketplace bank begins today with industry-leading loan and deposit products, a strong brand and loyal customer base, considerable technology and data advantages, and a differentiated offering that allows us to better serve an expanded total addressable market, which will allow us to drive sustained earnings growth. Near-term, personal loans will be our primary economic driver, and we plan to grow originations by 45% and revenue by 55% this year. As Tom will lay out for you in a minute, the growth and earnings power of LendingClub will become quite clear after we absorb the costs and accounting implications of operational integration.

As a team, we are very committed to executing on our strategy and building long-term value for our shareholders. Together with our core unsecured lending capabilities, our digital bank gives us a highly differentiated offering that positions us well to compete while providing cost-effective financial solutions for our customers. It is our intention to stay disciplined, execute, and deliver in the near term, while investing for the future to achieve our broader ambition and redefine banking for our customers. Okay. With that, I will pass it over to you, Tom.

Tom Casey (CFO)

Thank you, Scott. As you just heard, we are tremendously excited about the future with the addition of our new banking capabilities. I'll spend my time going deeper into some of the areas that Scott touched on, but we'll start off covering highlights from Q4 earnings. We're very encouraged by our positive business trajectory in Q4. We increased originations to $912 million, exceeding the high end of our guidance range and reflecting growth of 56% from the third quarter. We ended the year with $525 million of cash, reflecting the sale of $450 million of loans in the second half of 2020 as we prepared to capitalize the bank with cash to support strong growth. By maintaining such a high level of cash that alone we experienced a temporary and anticipated reduction in net interest income.

For the fourth quarter, the impact was about $20 million in revenue compared to Q4 of 2019 and $8 million compared to the third quarter of 2020. Our results for the quarter also did not include one-time benefits related to loan sales and loan and asset revaluations that occurred in the third quarter. The story for the quarter was pretty straightforward. Transaction fees up 77% from Q3 on the back of 56% origination growth, offset by lower net interest income reflecting prior loan sales and non-recurring asset revaluation benefits in Q3. With that, let's get into some of the financial benefits of our marketplace bank that Scott referenced and how this sets us up for 2021 and beyond. As seen on slide 11 in the LC Bank presentation, the economics of owning a bank are truly compelling, with substantial and readily achievable benefits.

With a vertically integrated digital platform, we capture the best of the marketplace and the bank, creating a self-sustaining, high-growth, and highly profitable business with structural advantages. Let me outline some of these benefits. First, with access to banking capabilities, we have significantly enhanced the resiliency of our business, enabling us to better serve our members. Deposits are much more stable compared to warehouse funding used by other fintech marketplace. Second, access to low-cost deposits also reduces our borrowing costs dramatically, allowing us to generate a new and growing stream of recurring earnings. This will help drive strong and sustainable profitability. Third, as a bank, we become vertically integrated, reducing our dependency on others and eliminating the fees we paid to third-party issuing banks for originating the loans on our behalf.

To put this into some perspective, over the last two years, our partner banks received approximately $20 million per year for originating our loans. Fourth, we intend to hold prime loans comprising 15% to 25% of our total originations while selling the rest through the marketplace. This leverages the unique capabilities of our platform and aligns our interests with investors. Together, we can balance a recurring and durable bank revenue stream with the capital-light marketplace fee-based revenue stream. Fifth, our marketplace is fueled by a diverse investor base that allows us to continue serving borrowers across the credit spectrum. This has enabled us to create a hugely efficient marketing engine while building a more inclusive brand that aligns with our mission to empower members on their path to financial health. Now let's talk about how some of these benefits translate into enhanced financial performance. We'll start with deposits.

As you can see on slide 12, the benefits of deposit funding are very clear. Compared to pre-pandemic levels, our borrowing costs have declined by approximately 90%. Yes, 90%. In 2020, the average cost of warehouse lines was 3.3% compared to our bank's deposit cost today of about 35 basis points. To put this into perspective, for every $1 billion in assets we hold, we will now save approximately $30 million per year in interest expenses. As I mentioned earlier, deposit funding is more stable than warehouse funding, which can dry up when market volatility increases. There is less funding availability when you need it. Adding deposits and replacing these other funding vehicles is transformative to both the economics and the resiliency of our company and will enable us to drive a new stream of recurring revenue.

Our bank also has an award-winning platform that brings $2 billion in deposits, which will help support our future growth. In addition to lowering our funding costs with deposits, our new marketplace bank will capture significant financial benefits from being a bank and having a marketplace. As you can see on the right-hand side of slide 14, for every $100 million in loans we originate, we generate about $4 million through an origination and servicing fee when we sell the loans via the marketplace. The vast majority of this fee-based revenue is realized immediately and without requiring a significant amount of capital. However, it is highly dependent on origination costs. We can now bolster this revenue stream with bank revenue generated by loans held for investment on our balance sheet.

As you can see on the left side of the page, every $100 million of loans we hold on the balance sheet generates our additional marginal profitability of approximately $12 million. When you compare that to the $4 million in the marketplace, that's three times more. This is recurring revenue and it's not dependent on originations in any given quarter. However, from the standpoint of GAAP profitability, loans held for investment have accounting requirements such as CECL allowance for credit losses and the deferral of origination fees, which results in a loss at the time of origination. CECL provisions are often an issue when loan balances are flat or growing at a low level. In contrast, we expect to grow loans at a relatively rapid pace. Therefore, the cumulative layering of expected credit loss upfront will pressure short-term GAAP income.

As we continue to grow this portfolio, we'll establish an ongoing annuity of future earnings. Now, I want to underscore that even though GAAP accounting results in a front-loading of expenses relative to revenue, the cash economics of retaining loans are very attractive. As growth normalizes and the impact of upfront expenses recognition becomes less pronounced, GAAP and economic profitability of loans held on the balance sheet will converge. The combination of revenue streams from the bank and the marketplace should enable us to grow faster and better navigate through challenging periods. In addition to the power of the marketplace-based model, we benefit from being a leader in a very attractive asset class. Slide 15 shows that even after adjusting for credit losses, LendingClub's direct-to-consumer personal loans generate risk-adjusted margins of approximately 7.5%, representing more than two times the margins for traditional banks.

As we increase the proportion of consumer loans over time, we'll generate a highly profitable earnings stream at industry-leading margins. With that overview of the financial drivers of our new business model, let me provide some context and details behind our near-term outlook. I note our guidance excludes any potential impact from the FTC, which we hope to get resolved by the end of the year. 2020 was a year of repositioning as we navigated the pandemic, reduced our fixed costs by 30%, and prepared for the acquisition of Radius. 2021 will be the year in which we prime the pump as we begin to build our consumer loan portfolio, integrate the bank, and accelerate our origination growth. All this will set the company up to generate strong multi-year earnings growth.

A reminder, with our new model, there is no longer an immediate one-to-one connection between origination volumes and revenue. That is because the loans we hold, both origination fees and net interest income, will be recognized over time rather than at origination. You can see the dynamics layout as follows. For Q1, we expect originations to grow faster than revenues because of the deferral of origination fees. We expect originations to grow 30% to 40% versus last quarter, while revenues will be growing at 15% to 25%. However, when you look at the full year, you see the opposite, where revenues outpace originations, driven by growth of interest income. For the year, we expect origination growth of about 45% and revenue growth at 55%.

You can see a similar dynamic of timing differences play out in our net income, which is impacted not only by the deferral of revenue at origination, but also by the upfront CECL-driven recording of charge-offs that occur over the life of the loans. Accordingly, we expect to report a GAAP net loss in Q1 ranging between $75-$85 million. For the year, we expect a net loss of $175-$200 million. Now, note, this loss is almost entirely due to the change in accounting convention for loans held at the bank due to adopting CECL accounting and origination fee deferrals. I want to note that we also included roughly $20 million of one-time costs related to the acquisition of Radius. These investments will prime the pump for recurring high-margin earnings for years to come.

We expect to earn more than two times the amount of the CECL provision over the life of the loan. Our outlook is consistent with the financial plan we submitted to the regulators for the bank acquisition. Over time, we anticipate that our GAAP earnings will drive industry-leading ROEs and catch up to our high-growth cash earnings. I also wanted to provide you with two additional details. We used approximately $140 million of our $525 million cash position for the purchase of Radius. We also capitalized the bank with an additional $250 million of cash, bringing the LC Bank equity to approximately $440 million. Staying on the theme of capital, at the end of 2020, we had a valuation allowance of $211 million against our entire deferred tax asset.

Over time, as we generate GAAP earnings, we expect to reverse this valuation allowance, which will substantially increase our tangible book value and generate substantial savings on cash taxes. I know we went through a lot of information today, and I appreciate your interest in the company. Before we get into questions, let me leave you with three key takeaways. First, we have a cycle-tested and differentiated business model with data and technology advantages. Second, our unique business model allows us to leverage the benefits of both our capital-light marketplace and our bank, enabling us to further disrupt the banking industry. Third, we are a leader in a large and growing market with substantial growth ahead.

With about $440 million of capital and a business that will generate earnings to support future growth, we are very excited about the road ahead and how well positioned we are to create significant shareholder value. Now, let me open it up for questions.

Operator (participant)

We will now begin the question and answer session. To ask a question, you may press star, then one on your touch-tone phone. If you are using a speakerphone, please pick up your handset before pressing the keys. To withdraw your question, please press star, then two. Our first question today will come from Steven Kwok with KBW.

Steven Kwok (Analyst)

Great. Thanks for taking my questions. Congratulations on the closing of the Radius acquisition. I guess the question I have was just around pro forma tangible book value post-Radius acquisition. If you could provide a bit of.

You guys have given us highlights around the impact of the acquisition. Are those terms still the same around the beneficiaries and stuff as we think about it?

Scott Sanborn (CEO)

Yeah. Let me answer your first question and then just clarify your second one. On the tangible book value at the bank, as I mentioned in my comments, it's about $440 million. We ended the year—excuse me, yeah, at the end of the year, we were at total equity was about $750 million. We still have additional capital as a parent. Inside the bank, we've got about $440 million of tangible book value. The second question you had, Steven, just if you clarify that you mentioned something about the benefits.

Steven Kwok (Analyst)

Yeah. At the time of the Radius acquisition, you had given us in terms of what the benefits were from the Radius Bank.

Are those still largely intact around funding, investments, and banking economics?

Scott Sanborn (CEO)

Yeah. They are. Overall, we've continued to feel very good about the acquisition. Things have changed a little bit. Obviously, rates are much, much lower than they were. And Radius has delivered a lot more deposits than we originally modeled. Clearly, that's a much bigger benefit. We still get all the benefits that we talked about as far as issuing bank fees and obviously the lower cost of funding that I mentioned in my prepared remarks are very significant. Obviously, the interest income is quite larger than we expected, again, because of where the deposit costs are right now. Feel very good about the acquisition and the profile that Radius has as we get started integrating them into this quarter.

Steven Kwok (Analyst)

Got it.

If I could just take one last one in just around the GAAP consolidated net income, understanding that this year you have the one-time acquisition cost along with the CECL impact and stuff. When should we expect on a GAAP basis for you guys to become profitable as we continue this acquisition along with the loan growth?

Tom Casey (CFO)

Yeah. We have not given long-term guidance. Stephen, obviously, lots of things to work through this year. We obviously just closed the transaction. We gave you quite a bit of information on the new model and some of the key drivers of our profits and revenue. Just to highlight a couple of things to help you navigate. As we have tried to show you is that the deferral of the origination fee and the provision obviously put pressure on our reported results.

I'd refer you back to page 14 to show how fast the earnings recover. You can see that pretty significantly those two deferrals come back pretty quickly within the first nine months or so. We're not saying when we're going to be GAAP profitable. I did say in my prepared remarks that most of the—almost all of the GAAP loss this year is really the CECL accounting provisions that require losses to be recognized upfront and the deferral of fees. Just some quick math for you. If you were to take those two items, that's about $165 million of the loss right there, just those two items alone. Then you add the additional $20 million of integration-related expenses that creates right to about the midpoint of our guide.

Scott Sanborn (CEO)

Yeah. I just add, Tom.

I mean, Steven, our goal here is to build a high-growth, high-profit machine that is driving really sustainable growth over a multi-year period. Getting to GAAP profitability soon would actually be pretty straightforward based on the numbers Tom said. We are making a conscious decision to add the loans to our portfolio because we are going to drive, as you can see in the numbers, overall, as an enterprise, for every given dollar of loan origination, we can drive 30 to 40% more in earnings than in our historical model. This is really just a timing difference. Part of the timing of GAAP profitability is going to be based on our growth rate. Our plan is to continue growing.

Steven Kwok (Analyst)

Got it. Great. Thanks for taking my question.

Operator (participant)

Our next question will come from John Rowan with Janney.

John Rowan (Analyst)

Good afternoon, guys.

Just to be clear, there's a lot of talk about CECL. Radius has already adopted CECL, correct? So there's not a one-day catch-up on the allowances you adjusted for higher lifetime losses. Is that correct?

Scott Sanborn (CEO)

Yeah. John, no. They were not subject to CECL. So we've adopted CECL as part of the acquisition. I didn't leave that complexity out of my narrative. Yes, they will have a conversion amount. We're working through the purchase accounting now. There will be a conversion amount to establish a new provision. We'll recognize that in the first quarter. That's included in my guidance.

John Rowan (Analyst)

Okay. The day-one CECL adjustment for the allowance for Radius Bank is included in the GAAP loss figure for Q1 and for 2021, correct? Just to make sure I have this right. That's correct.

Scott Sanborn (CEO)

That is one of the reasons why you see that loss so large in the first quarter as part of it.

John Rowan (Analyst)

I mean, how much do you bring into the allowance? Why is the day-one CECL adjustment here not just a charge to equity as it was on day-one 2020?

Scott Sanborn (CEO)

Yeah. We did not own them on day-one 2020, and they did not adopt CECL. As part of the acquisition, since we had already adopted CECL in our own books, we adopt CECL for them through purchase accounting. That is the piece I was just referring to. There is a day-one charge as part of our purchase accounting. I will break it out for you 1Q. It is in our guidance, though. We will finalize the number. We are in the process of finalizing that number. It is all in my guide right now.

John Rowan (Analyst)

Okay.

Just last question. You guided us to how loans held through the bank are three times more profitable versus the traditional marketplace model. Has there been any change in the guidance that you provided that 10% of the loans are going to be funded? 10% of the LendingClub loans are going to be funded through Radius? Or is there an update to that guidance figure?

Scott Sanborn (CEO)

Yeah. I gave in my prepared remarks that we're targeting about 15 to 25% depending on the final volumes for the year. We think that's a good range to, again, build a new recurring revenue stream that accelerates our earnings growth. At the same time, it maintains plenty of volume for our partners on the investor side to buy our loans.

Tom Casey (CFO)

I just want to make sure everybody's tracking when we say funding through Radius.

What we're referring to, to make sure that's the answer to your question, is what % of loans are we holding? That's 15 to 25%. What percent of loans are being sold through the marketplace? That's 75 to 85%. That's it. Okay. Thank you. Thanks, John.

Operator (participant)

Our next question comes from Henry Coffey with Wedbush.

Sameer Gokhale (Head of Investor Relations)

Henry, I think you might be on mute.

Operator (participant)

We'll go ahead and go to our next question from Bill Ryan with Compass Point.

Bill Ryan (Analyst)

Thanks. Good afternoon. A couple of questions. First off, in the discussion with the regulators, and I know it's probably baked into your guidance, did they put limitations on, if you will, sort of the retention of loans going forward?

Because I know a lot of—thinking back to some of the companies I followed that converted to banks—they were limited in the amount of growth on any possible restrictions. The second thing on the CECL side of the equation, I had in my notes sort of a 6%. Is that still the right number? When will kind of charge-offs follow behind it over what kind of time period?

Scott Sanborn (CEO)

Yeah. The first one on the restrictions, all the information we provided you is what we've used for our regulatory approval. These are the guidance we gave you reflects that. Obviously, with any approval process, there are business plans that we lay out. Our profile that we're showing you today is consistent with that.

We do not see any of the agreements we made with regulators causing any concerns on any of the things we laid out for you today. We feel that this is a very, very good profile. The accelerated growth that I had talked about is consistent with that. With regard to CECL, your 6% to 7% is what I would call on a nominal basis. The five I showed you was on a discounted basis. The recognition of the actual charge-offs, these have a duration typically on our three-year loans of about one and a half years. Your peak losses are going to come in maybe in the 12-month time frame. They will come in over the life of the loan as opposed to, as you know, the CECL charges upfront.

Bill Ryan (Analyst)

Right. I just questioned you. You said the discount.

You approached or you're taking the discounted valuation approach to CECL?

Scott Sanborn (CEO)

That's right. It takes about a point off of it, Bill. I showed you five on day one. The numbers I showed you on page 14 are net of any additional CECL increases over time, if any.

Bill Ryan (Analyst)

Okay.

Operator (participant)

If there are any further questions, plese press star one one to join our queue. Seeing no further questions, I'd like to turn the call back over to Scott Sanborn for any closing remarks.

Scott Sanborn (CEO)

I hope you could hear in our prepared remarks. Myself and the rest of the team are very excited to take this combined business forward. We thank everybody for their patience. We were a little delayed in getting this out to you. We look forward to talking to many of you offline.

Operator (participant)

This session is now concluded.

Thank you for attending today's presentation. You may now disconnect.