Sadot Group - Q2 2024

Transcript

Operator (participant)

Welcome to the Sadot Group Inc. Q2 2024 Earnings Conference Call. Today's call is being recorded, and all participants will be in listen-only mode. After management's prepared remarks, we will take questions. At this time, for opening remarks and introductions, I would like to turn the call over to Frank Pogubila, Sadot Group Inc.'s investor relations contact.

Frank Pogubila (Head of Investor Relations)

Before we get started, we would like to state that this call may include forward-looking statements pursuant to the Safe Harbor Provisions of the US Private Securities Litigation Reform Act of 1995. To the extent that the information presented on this call discusses financial projections, information, or expectations about the business plans, results of operations, products or markets, or otherwise make statements about future events, such statements may be forward-looking. Such forward-looking statements can be identified by the use of words such as should, may, intends, anticipates, believes, estimates, projects, forecasts, expects, plans, and proposes. Although management believes that the expectations reflected in these forward-looking statements are based on reasonable assumptions, there are a number of risks and uncertainties that could cause actual results to differ materially from such forward-looking statements.

You are urged to carefully review and consider any cautionary statements and other disclosures, including the statements made under the heading Risk Factors in Sadot Group Inc.'s most recently filed Form 10-Q, and elsewhere in documents that Sadot Group Inc. files from time to time with the SEC. Forward-looking statements speak only as of the date of the document in which they are contained, and Sadot Group Inc. does not undertake any duty to update any forward-looking statements, except as may be required by law. For this call, all numbers disclosed have been rounded to the closest hundred thousand, unless under a million, and percentages have been rounded to the closest percent, unless otherwise noted.

All numbers disclosed in this report are the amounts attributable to Sadot Group Inc., and exclude the portion related to non-controlling interests. On this call, we will refer to Sadot Group Inc. as Sadot Group, Sadot, or the company. With me on the call today are Sadot Group's Chief Executive Officer, Michael Roper, and Chief Financial Officer, Jennifer Black. Michael and Jennifer will be presenting prepared remarks related to Sadot Group's financials filed on August thirteenth, 2024, and those documents may be found on the company's website, Newswire feeds, and on the SEC's website, linked from Sadot Group's website at www.sadotgroupinc.com under the Investor tab. At this point, I would like to turn it over to Sadot's CEO, Michael Roper. Michael?

Michael Roper (CEO)

Thanks, Frank. Good morning, everyone, and thank you for joining us today as we present the results of our second quarter. I'm extremely proud to announce that Sadot Group reported the best quarter and six-month year-to-date performance in our company's history, delivering significant positive net income and notable improvements in our financial position. This record-breaking performance underscores our resilience and commitment to operational excellence as we execute against our strategic vision. Importantly, we consider ourselves to be in the early stages of our growth strategy as an emerging entity in the almost $2 trillion agri-commodities market. As we focus on driving change in the company's business model and transitioning the company into a larger player in the global agri-commodities market, we believe we are starting to see these efforts reflected in our overall results.

For the second quarter, consolidated revenues increased 9% to $175 million, driven by Sadot Agri-Foods. Net income of $2.4 million exceeded the $190,000 we reported in Q2 2023. Additionally, our 2024 year-to-date cumulative net income is a positive $2 million, compared to a net loss of $876,000 for the same period in 2023. Jennifer will discuss the financials in further detail shortly. Overall market conditions in the agri-commodity sector started to improve in Q2, following a challenging Q1. Importantly, even though China demand remains a headwind as they focus on domestic production, the company was able to shift to other markets to drive growth, which helped drive the $76 million revenue increase from Q1. Combined with our corporate strategic growth initiatives and strong execution, this significantly contributed to our Q2 results.

In addition to the growth potential within the global agri-commodity market, we believe several powerful industry trends are converging to support Sadot Group's strategic initiatives and long-term success. First and foremost, the growing global demand for agricultural commodities is expected to be a crucial driver. Rising population, increased urbanization, and evolving dietary preferences are all contributing to heightened consumption of food and feed products worldwide. We believe this dynamic creates a favorable backdrop for companies like Sadot Group that are positioned to efficiently originate, trade, and distribute essential agri-commodities. Secondly, the heightened emphasis on food security and sustainability represents a substantial opportunity for Sadot Group. Governments and international organizations are prioritizing initiatives to ensure stable food supplies and mitigate supply chain risks, areas where our vertically integrated business model, featuring both trading and farming operations, provides distinct advantages.

And finally, the ongoing consolidation and diversification trends within the agri-commodity sector present exciting inorganic growth opportunities for Sadot Group. As industry players seek to expand their geographic reach, product offerings, and value chain integration, we believe we are well positioned to capitalize on strategic acquisitions and partnerships that can further strengthen our market position. By proactively aligning our business model and growth initiatives with these powerful industry drivers, Sadot Group is poised to pursue its position as a leading global player in the dynamic and essential agri-commodity market... To capture a greater share of this market opportunity, we are strategically expanding our operations into key supply chain verticals, including farming, origination, and trading. Longer term, we also see significant potential for expansion into other verticals such as shipping, logistics, processing, and distribution. The formation of Sadot Brasil, and more recently, Sadot Canada, are a direct reflection of this strategy.

Both of these new subsidiaries complement our existing operating centers in Miami, Singapore, Dubai, and Kyiv. We remain actively engaged in expanding our global platform and continue exploring further regional expansion opportunities. At the beginning of August, we announced the key leadership appointments for our newly formed Canadian operation. I'd like to take this opportunity to welcome both David Hanna as Executive Vice President, General Manager, and Jaime Rueda as Vice President, Head of Feed Ingredients for Sadot Canada to the Sadot team. Their extensive experience. I almost said expensive experience, but I guess that's accurate too. Their extensive experience and deep knowledge of the agri-commodity markets make them invaluable additions to the company. Their combined leadership, alongside the professional and dedicated management and team members in Miami, Brazil, and Dubai, will be instrumental in advancing Sadot's global growth agenda by working together to expand trade flows globally.

Next, let's discuss the farm operations. Our farm operations serve as an integral part of the total food supply chain operation. Importantly, from an agri-commodity trading perspective, the farm crop allows the company to trade year-round, with the underlying commodity as collateral in case the market turns negative, helping to insulate us from market fluctuations. Increasing our farming capabilities in strategic locations worldwide will continue to be an important focus point for the company, allowing us to expand our trading, food security, and community impact endeavors around these farms. Regarding our legacy restaurant business, as we've been actively pursuing the divestiture of these non-core assets to focus on our agri-commodity origination, trading, and shipping, and farming. The company is engaged with numerous potential buyers, resulting in the recently announced sale of Superfit Foods.

This transaction is the first of three restaurant concepts to be sold from our portfolio as the first step in our overall strategic plan to exit the restaurant business. We expect the divestiture of these non-core assets to drive operational savings and simplification. This will ensure our resources are firmly aligned around the company's highest potential opportunities in the agri-commodities market. Regarding Muscle Maker Grill restaurants, we have recently completed the process of converting corporate-owned and operated Muscle Maker Grill locations to franchise locations. We believe this concept is now positioned to potentially attract a wider base of interested parties. For Pokémoto, this likely will be the largest transaction of the three concepts, and we are in negotiations and detailed discussions with several groups for the sale of our Pokémoto concept, of which there is no guarantee.

As the sale of each concept occurs, we expect to reduce G&A expenses, potentially enhancing the bottom line while simultaneously generating cash flow into the business. Now I'd like to turn the call over to our CFO, Jennifer Black, to review more specifics of the financial performance of the company for the second quarter of 2024. Jennifer?

Jennifer Black (CFO)

Thank you, Mike. Before I begin, please note that our financial results for the quarter ending June 30, 2024, on Form 10-Q, were filed with the SEC yesterday, August 13, 2024, along with the press release on that same day. Our consolidated revenues increased 9% to $175 million in the second quarter of 2024, compared to $160.6 million for the same quarter in 2023. Our Sadot Agri-Foods segment accounted for the majority of our revenues, contributing $173.3 million in the second quarter, as we completed 21 transactions across 8 different countries. The farm completed its first full year of harvest, and in Q2, harvested over 2,500 metric tons of maize and 690 metric tons of soy.

Our legacy restaurant operations, which are classified as held-for-sale, had $1.7 million of revenue in Q2. SG&A expense of $2.4 million for the quarter increased by over $500,000 versus a year ago, mainly due to the upfront costs associated with the opening and expansion of our Sadot Agri-Foods trading offices, which are integral to our growth strategy. Net income of $2.4 million was a notable improvement from the $190,000 for Q2 2023. EBITDA was $3.2 million, compared to $656,000 in the second quarter of 2023. Now, looking at our balance sheet, the company had a cash balance of $10 million and a working capital surplus of $16.1 million, reflecting strengthened financial stability.

This compares to a cash balance of $1.2 million and working capital surplus of $13.2 million as of March 31, 2024. It is important to note that as a part of our ongoing strategy, we continually invest our cash back into the agri-food commodity trading business to increase our revenues or to add strategic assets. The company is exposed to market risk, primarily related to the volatility in the price of carbon offset units and food and feed commodities. To manage these risks, we entered into forward sales contracts and hedges from time to time. The forward sales contracts are initially measured at fair value, and any changes in fair value are recorded as gain or loss on the fair value of remeasurement. The mark-to-market gain on these derivative transactions resulted in income of approximately $3.3 million for the quarter.

We are proud to report our best three and six-month performance in the company's history. Significant positive change is occurring across our business, enabling us to deliver improved revenue streams and increased working capital surplus and higher cash balance. We are continuing to strengthen our balance sheet while also reducing expenses, as we divest to the restaurant concepts. With that, I'd like to return the call back over to Michael Roper.

Michael Roper (CEO)

Thanks for the financial overview, Jennifer. In closing, I wanna thank all of our investors and stakeholders for your time and continued support of Sadot Group. We're extremely proud of the progress we've made in positioning the company for sustainable long-term growth, and we remain firmly committed to executing our strategic vision. As I've outlined today, we believe the combination of our growth potential in the vast global agri-commodity market, our improved financial performance and strong balance sheet, our innovative risk management approach, and our experienced leadership team provide us a compelling case for Sadot Group. Supported by powerful industry trends and tailwinds, we believe in our ability to continue driving value for our shareholders. Looking ahead, we'll maintain our disciplined focus on expanding our trading operations, diversifying our geographic footprint, and further integrating our farm assets to create synergies across the supply chain.

At the same time, we will judiciously manage costs and capital allocation to enhance profitability and returns. Thank you again for your time, and we look forward to updating you on our continued progress in the months and years ahead. With that, please give us a few moments while we open up the lines for questions.

Speaker 6

Thank you, Michael. Before we get to questions from our selected analysts, I believe you have some questions to address, which you received from the stakeholders.

Michael Roper (CEO)

Yeah, I do, Alexa. Thanks. We know, everyone, we normally get questions that get submitted to our IR email address. We try to accumulate these and kind of come up with a common theme and address those questions before we open it up to the analysts to make sure that we're addressing a lot of the common questions that are out there. So the first question, we have four of them to go through. The first question I have is: Can you elaborate on the potential growth opportunities in the $1.9 trillion global agri-commodity market, and what is Sadot Group's strategy to capture a larger share of this market? So, the global agri-commodity market, it represents an opportunity for Sadot with an estimated annual value at nearly $2 trillion. It's a big market, right?

Our strategy to capture a greater share of this market involves actively expanding our trading operations through strategic initiatives, such as the formation of Sadot Brasil and Sadot Canada that we recently announced. These new entities complement our existing trading hubs, and they allow us to facilitate trade flows to and from key regions, such as North America, Africa, Black Sea, Indonesia, et cetera. By diversifying our geographic presence and expanding our trading capabilities, we aim to position Sadot as a larger player in the global agri-commodities market. Now, one of the things I wanna kind of talk to you is, you know, that's kind of the horizontal expansion, right? But we also plan on expanding vertically into additional aspects of the global agri-commodity supply chain. And we actually see the industry that's divided into, like, three segments or three components. Number one is the upstream segment.

That kind of represents the origins of the product, kind of like farming, that's in emerging markets. The second segment is really, you know, classified as midstream. I know I'm being very technical here. Midstream, which is really trading, logistics, and infrastructure. And then there's, like, downstream, right? Which is processing capacity and the ingredients and feed industries, through different geographies, okay, where we can contribute value. So those are, like, the three areas. Now, we're currently operating in the upstream and midstream segments of the markets, and there's ample room to expand there within those segments, right? But as we evolve and grow, our goal is to continue capturing additional capabilities that's gonna allow us to expand vertically and fully integrate our operations overall. So Jennifer, you wanna take the next one?

Jennifer Black (CFO)

Sure. The next question we have is: When will Brazil and Canada contribute to the top line revenue? And with that, you know, Brazil is a crucial geography for any company involved in the agri-food supply chain. Our expansion into Brazil through the formation of Sadot Brasil has been a key strategic, strategic, sorry, priority over the past year. The team is building important foundations to support our strategy and goals in this region. Since we reported our first Brazil trade in July, the team has been involved in several other transactions surrounding sesame and are heavily involved with our new Canadian subsidiary, as well as other regions lining up future trades. Building these foundations require a deep understanding and connection with the professionals on the ground.

The Sadot Brasil office is establishing relationships with local producers, intermediaries, and end users to grow the company's presence in Brazil, and in the future, allow us to leverage our global distribution network and risk management expertise. Sadot Canada is our most recent addition to our global trading team, led by David Hanna and Jaime Rueda. The team in Canada is currently focused on the Canadian pulses market, building out its origination capabilities, securing financing facilities, and finalizing strategic partnerships to ensure a smooth market entry. The Sadot Canada team is in the process of introducing the new entity to the local market, farmers, exporters, global trading counterparties. Although we cannot provide a specific guarantee, we anticipate that Sadot Canada will begin executing trades in Q4.

It's important to note that Sadot Canada model will focus on smaller container size trades, and these types of trades are usually more frequent and have higher margins. The next question we have is: What does July revenue look like, and are you anticipating revenues to remain in the $175 million-$200 million range for Q3? I'm pleased to report that our July 2024 revenue came in at approximately $61 million, continuing the positive momentum we saw in Q2, and an increase of roughly 15% from July 2023. Our team remains focused on executing our strategic growth initiatives, prudently managing our risk, and driving increased value for our shareholders. Mike, you wanna go to the next one?

Michael Roper (CEO)

Yep, I got another question here. Hold on a second. Let me make sure I got the right one. So the last question we have here before going live to the analyst is: Can I provide more details on the divestiture of the restaurant assets? What is the anticipated timeline and expected impact on the company's financials? So, as you guys know, we are actively pursuing the divestiture of our non-core restaurant assets, which is a key part to our strategic plan that allow us to focus on the agri commodity business, right? And that's our core business, so we wanna focus on that, instead of, you know, worrying about the restaurants.

We've already completed the sale of Superfit Foods meal prep service, which we announced a few weeks ago, and we are in the various stages of due diligence for the remaining concepts, the Muscle Maker Grill restaurants and Pokémoto. I think I mentioned earlier, we've actually got several groups that we're talking to, regarding Muscle Maker and Pokémoto and in different stages of those discussions. As we complete the sale of each restaurant concept, you know, we do expect to see a reduction in our G&A expenses, which should enhance our bottom line performance. Additionally, the divestitures will generate cash flow that we can reinvest in the Sadot Agri-Foods operations that will support our growth initiatives.

While the specific timeline for the remaining divestitures is still being finalized, we are working diligently to complete these transactions and further streamline our business model. Let me highlight really quick, the recent Superfit Foods transaction, along with the sale of the final company-owned Muscle Maker Grill restaurant, where we converted into a franchise location and the closing of an underperforming location, kind of lumping all those together. And these transactions all occurred in early Q3 of 2024. With these recent moves, we believe our expenses were reduced by an estimated $400,000+ per year on an annualized basis, as we eliminate the overhead associated with operating these locations. Importantly, the current and future cash proceeds are roughly about $400,000 as well, from these transactions will be reinvested back into the business.

So we believe Superfit Foods represents the smallest transaction of the three concepts, with Pokémoto likely to be the largest. And like I said earlier, we are in detailed discussions with multiple groups for both Muscle Maker Grill and Pokémoto. And we view the successful completion of Superfit Foods sales as an important milestone in the strategic transformation into a more streamlined and higher margin agri commodity company, right? Again, wanna get rid of the restaurants and take that money and redeploy it towards the Sadot Agri-Foods business. So with that, I think that answers all the questions that we kind of summarized here. So, Alexa, do you wanna take it over to the analysts on the line?

Speaker 6

Yeah. Thanks, Michael. I would like to open the call to Aaron Grey with A.G.P. for questions first, please.

Aaron Grey (Managing Director and Head of Consumer and Cannabis Research)

Hi, thank you for the questions and nice improvement in the quarter here. So first one for me, just in terms of the AgriFood business, commodity business, I know there can be some volatility there, you know, saw a nice pickup there, sequentially, in the quarter. So wanted to get a better line of sight in terms of whether or not you're seeing, you know, a more line of sight yourselves in terms of the trajectory of where sales can go. Do you believe there will still be some more volatility? I know you're getting more diversified entering new markets, so just some more color in terms of where you think the top line within that business can go from here. Thank you.

Michael Roper (CEO)

Okay, thanks, Aaron. So a couple of things, and then I'll let Jennifer jump in here as well. But I'd like to start off. You know, as Jennifer mentioned, you know, we saw July come in at a little over $61 million for the month, so that's a good start to the quarter. So we're continuing to see that, you know, build that momentum after the poor performance in Q1, right? Which was attributed to the China market more than anything. So China has become more stabilized. They are still focusing on their domestic production, but us, as a company, have been, you know, pretty resilient in being able to move a lot of the trades and business to other parts of the world.

And I think that's really key about the future of where we see kind of some of the revenues going is, as we continue to grow by adding Sadot Brasil and then adding, you know, Canada here recently, and, you know, obviously, hopefully some more as we move forward, you know, that just gives us more diversification and allows us to, you know, move around. So we can try to stabilize some of the fluctuations that you talked to and some of the variations that might happen that's out there. And I think we kind of proved that, you know, in Q2 and now beginning of Q3 as well. So, you know, so, so from a stability standpoint, I think that bodes kind of well for us, as we move forward.

But like you mentioned, there's always, you know, fluctuations that are out there, but I think we are nimble enough and have a wide enough footprint now or whatever, to really start being able to manage around some of those things.

Aaron Grey (Managing Director and Head of Consumer and Cannabis Research)

Okay, appreciate that color, Michael. And the second one for me, on the gross margin, nice improvement there as well. So on a similar level, are you already seeing some of the benefits of the trade financing that, you know, help with the gross margin? Or was that more so just the trades that were made during the quarter that really led to the improvement? So similar question I would ask before, but on the gross margin here, in terms of how we should think about the margin profile for the different, you know, trades you're making, either via products or geographies over the next couple quarters. Thank you.

Jennifer Black (CFO)

Thanks, Aaron. On this one, it truly was the trades that we did this quarter that generated those margins. It's we haven't really been able to dive deep into the trade finance part yet, and so this has all been done organically. When it comes to kind of how we're gonna manage it in the future, that's the whole reason we are diversifying. You know, we're looking at different, you know, different segments, like we said, with the opening of Brazil and Canada. And with those, entering those new markets, we're entering new areas. You know, like we said, with Brazil, we did the sesame. And then when we go into Canada, we're doing the pulses, which are the smaller containers. And like I said earlier, those smaller containers tend to generate higher growth margins.

When you have more options, you know, that lets us shift the money or shift the, you know, shift the resources onto where you're seeing they could help generate that better margins.

Michael Roper (CEO)

I think that just to reiterate, I think, you know, part of the key there as we move forward, as Jennifer mentioned, is, you know, the Canadian business model, as we bring that one online, that one really is more oriented towards container size orders versus entire cargo ship orders. And so there's a lot more frequency and a lot more, you know, transactions that happen through that. But those do tend to be higher margin items, you know, in general, than the container ships as well. So as we intermix that in there, that should help, you know, you know, address some of the the margin fluctuations that we see with some of the larger container ships, and then obviously going into different products as well. Like she's mentioned, we got into sesame now, right?

And so different products, different times of the year, et cetera, have different, you know, margins that are in there. So having a wider option base that's out there for us bodes well.

Jennifer Black (CFO)

And in addition to there, you know, with there always being volatility, we do hedge, you know, to mitigate that risk, which, you know, as always, it does kind of lower some of that, but it also is more secure and safer to hedge those risks.

Aaron Grey (Managing Director and Head of Consumer and Cannabis Research)

Understood. Thanks for that color there. I'll go and jump back in the queue.

Speaker 6

Great. Thanks, Aaron. I'd like to open the questions for Tom Kerr with Zacks.

Tom Kerr (Senior Equity Research Analyst)

Good morning. Can you hear me?

Speaker 6

Yes. Thank you.

Tom Kerr (Senior Equity Research Analyst)

Just a question on the operating cash flow, which is really strong, I think over $8 million in the quarter. You know, what were the working capital components that drive that? And do they cycle back and forth, where we may not see strong operating cash flow in the second half of the year? Give us the right color on how that works.

Jennifer Black (CFO)

Yeah, absolutely. All of these are going to come down to timing, Tom. You know, when payments are received and when they're redeployed. Our strategy has been, and will continue to be, to reinvest our cash into the company, to put that cash to work and generate margin. We don't want to sit on a bunch of cash. I know a lot, a lot of people like that, especially analysts. You like us to have cash on the books, but we want to use that cash and generate additional margin. So, you know, this quarter, yes, we did have a higher cash balance, and that was due to timing of the receipt of payments. You know, we're deploying those back out and trying to earn money and earn revenue on that cash.

Tom Kerr (Senior Equity Research Analyst)

Okay, that makes sense. And going back to the commodity gross margins, I think it was 1.1%, and you kind of discussed this a little bit, but that's not where we want to be, right? And maybe can you publicly talk about long-term goals for gross margin?

Michael Roper (CEO)

Yeah, I, I'm not sure. I mean, look, everybody wants a higher gross margin, right? There's no question about that. And we've talked in the past and, and continue to look, you know, as we move forward into ways to, you know, increase the overall, you know, profitability of the company, even beyond just trades, right? So everybody keeps focusing on trades, but as we, as we continue to move into, you know, the farming aspect and some of the other aspects that are there, and if we get into, you know, shipping or any other of the other areas, you know, those will help drive, you know, some of the margin numbers. As we mentioned about Canada, you know, those, those smaller trades tend to drive larger margins as well. So as they come online, that should help, you know, push that.

But reality is, it's you know, in this industry, it just kind of depends on seasonality, it depends on the products you have and the you know, the deals you make or whatever that are out there, what's you know, kind of happening in the market. So yes, we'd like to see higher margins. You know, we've had some higher margins in the past. We've had lower margins in the past, right? So I do think in that you know, that 1-3 range or whatever is where you know, we want to be you know, where we can you know, achieve you know, that's out there. But again, it just kind of depends on the timing of the year and the different products that are happening in the marketplace.

I know that doesn't give a distinct answer, you know, or whatever, but that's probably about as good as I can get, you know.

Tom Kerr (Senior Equity Research Analyst)

No, that's helpful.

Jennifer Black (CFO)

In addition to that, you know, once we get all these trade finance lines kicked in and going and optimized, it will provide better return on equity.

Tom Kerr (Senior Equity Research Analyst)

Yep, and two more quick ones for me. Back to the trade financing, you put a number on it last quarter. I think you had up to $26 million availability. Is it does that continue to increase or change or?

Michael Roper (CEO)

It's, it's still basically at that same point. We are working, though, we're getting closer, on multiple other, trade finance options that could be significantly larger if, you know, they come through. So we continue to work on that. I think what's really more important is, part of it is, you know, being able to deliver what we delivered with the trade finance lines that we do have, right? And so, you know, and it's bringing some of those more online, if you want to say, as we move forward, we just bode well, you know, for the future on it. But, you know, we have been able to accomplish what we have, so far just with what we have today.

Jennifer Black (CFO)

There's other options out there that we are utilizing that are not just trade finance line, and that we're looking into, like supplier credits, you know, insurances and other options that allow you to tap in there without actually having trade finance.

Tom Kerr (Senior Equity Research Analyst)

Got it. Okay, last one from me is, did I hear you say Superfit proceeds were $400,000?

Michael Roper (CEO)

No. So it was a combination between Superfit and converting the one Muscle Maker, the last Muscle Maker Grill location over to a franchise location. So the total proceeds of those two were kind of in that $400,000 range. You know, so again, nothing material coming out of those, but it's the first step in really, truly, you know, divesting these things and moving forward. The Muscle Maker Grill restaurants will be larger, you know, should be anyway, than Superfit Foods. And obviously, the big one that we're working on is Pokémoto. That's the larger of the three concepts that are going out there. Those are both still being worked on right now.

Jennifer Black (CFO)

Just to kind of add on to that, with that, those sales, we did not take a loss on those.

Michael Roper (CEO)

Great.

Tom Kerr (Senior Equity Research Analyst)

On those two items? Okay.

Jennifer Black (CFO)

Yes.

Tom Kerr (Senior Equity Research Analyst)

Got it. That's all I have for today. Thank you.

Speaker 6

Thanks, Tom. If there aren't any more questions, that concludes our Q&A portion of the call. Mr. Roper, any final comments?

Michael Roper (CEO)

I just want to thank everybody for being, you know, shareholders and, and going through this with us on this adventure, that we have as we grow this company. You know, a lot of good things in the future that are coming up, and as I think you've seen a lot of good things that have happened here in the recent past as well, that continues to, propel us and become a larger player in the industry. But, you know, again, just thanks for everybody for their patience and, appreciate all the questions and, and cooperation and, and comments and, and suggestions and everything that everybody makes, you know, whatever that's out there. So, doing our best and moving forward.