Logo of jester cap with thought bubble.

Image source: The Motley Fool.

Hospitality Properties Trust  (SVC 0.81%)
Q4 2018 Earnings Conference Call
Feb. 27, 2019, 10:00 a.m. ET


Prepared Remarks:


Good morning, and welcome to the Hospitality Properties Trust Fourth Quarter 2018 Financial Results Conference Call. All participants will be in listen-only mode. (Operator Instructions) After today's presentation, there will be an opportunity to ask questions. (Operator Instructions) Please note, this event is being recorded.

I would now like to turn the conference over to Katie Strohacker. Please go ahead.

Katie Strohacker -- Senior Director, Investor Relations

Good morning. Joining me on today's call are John Murray, President; and Brian Donley, Chief Financial Officer. Today's call includes a presentation by management followed by a question-and-answer session with analysts. Please note that the recording, retransmission and transcription of today's conference call is prohibited without the prior written consent of HPT.

I'd like to point out that today's conference call contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and other securities laws. These forward-looking statements are based on HPT's present beliefs and expectations as of today, February 27, 2019. The Company undertakes no obligation to revise or publicly release the results of any revision to the forward-looking statements made in today's conference call, other than through filings with the Securities and Exchange Commission or SEC.

In addition, this call may contain non-GAAP financial measures, including normalized funds from operations or normalized FFO. A reconciliation of normalized FFO and adjusted EBITDA to net income as well as components to calculate AFFO are available in our supplemental package found in the Investor Relations section of the Company's website. Actual results may differ materially from those projected in these forward-looking statements. Additional information concerning factors that could cause those differences is contained in our Form 10-K to be filed later today with the SEC. And once again, in our supplemental operating and financial data found on our website at www.hptreit.com, investors are cautioned not to place undue reliance upon any forward-looking statements.

And with that, I'll turn the call over to you, John.

John G. Murray -- President and Chief Executive Officer

Thank you, Katie, and good morning. This morning, we reported fourth quarter normalized FFO of $0.61 per share, an increase of 13% compared to the $0.54 reported in the fourth quarter of 2017, primarily due to lower incentive fees, which decreased by $20.9 million or $0.13 per share, offset by weaker hotel performance in 2018 versus 2017.

Starting with performance in HPT's hotels, fourth quarter 2018 comparable RevPAR decreased by 1.7% versus the 2017 quarter, driven by a 1.7 percentage point decline in occupancy, partially offset by 0.8% increase in rate. HPT's comparable RevPAR performance lagged industry results this quarter for several reasons, including ongoing hotel renovations, non-repeat business due to hurricane activity and increased room supply in various markets.

Adjusting for hotel renovations and non-recurring hurricane activity, HPT's adjusted comparable RevPAR increased 2%. Among the factors that positively impacted fourth quarter results was lift associated with the 35 hotels that were renovated in 2018 through the third quarter. Particularly, those hotels are Hyatt and Marriott No. 234 portfolios. Overall, the group of recently renovated hotels increased RevPaR by 9.6%. On Marriott 1 portfolios, RevPAR was up modestly this quarter as a 2.1% increase in rate was offset by 1.2 percentage point decline in occupancy.

We had 15 hotels in this portfolio undergoing renovations during the quarter. Offsetting the negative impact from renovations was increased demand associated with the Massachusetts gas explosion, which boosted revenue at five of our suburban Boston Hotels. Non-repeat business from Hurricane Irma in Florida had a negative impact in our Courtyards in Atlanta Midtown, Miami Lakes and (inaudible). Coverage of our minimum returns remained strong in this portfolio at 1.2 times for the year ended December 31, 2018. Marriott 234 portfolio had flat RevPAR this quarter with a 1.1% increase in rate, partially offset by a 0.7 percentage point decline in occupancy.

There were six hotels in this portfolio undergoing renovations during the quarter. Offsetting the negative impact from renovations was increased FEMA business related to Hurricane Florence in North Carolina. RevPAR at our comparable IHG portfolio decreased by 3%, caused by 1.4% rate decline and 1.2 percentage point decline in occupancy. This portfolio was materially impacted by the closure of the Crowne Plaza Ravinia Hotel, which is undergoing renovations, and seven hotels impacted by non-repeat hurricane business. RevPAR growth for comparable hotels excluding these eight hotels was 2.2%.

Our comparable Sonesta portfolio grew RevPAR 0.8% this quarter, led by a 0.8 percentage point increase in occupancy, offset by a 50 basis point decrease in rates. This portfolio had five hotels undergoing renovations during the quarter. Portfolio occupancy was supported by growth in transit demand, driven by increases in corporate negotiated business. Sonesta's comparable extended-stay hotels led the portfolio's performance of 3.7% with strong gains at our legacy hotels and the 14 hotels we've acquired in late 2017 and renovated earlier in 2018. This was offset somewhat by the full service RevPAR decline of 0.6% due to renovations and softer performance in Houston and San Francisco.

Our Royal Sonesta Houston experienced non-repeat hurricane demand, and it's still combating supply headwinds and weak energy sector. Our (inaudible) Royal Sonesta Hotel experienced reduced demand from the non-repeat sales force convention last year and was also negatively impacted by the California wildfires.

Our Wyndham portfolio RevPAR decreased by 12.%, driven by an 8.4 percentage point decline in occupancy. Portfolio results were heavily impacted by non-repeat, FEMA business in Houston and Florida following hurricanes Harvey and Irma, supply growth in Chicago and Dallas and non-repeat Citywide groups in Atlanta. Wyndham continue to pay HPT 85% of the returns due under the management agreement, approximately $1 million less from the contractual amounts due for the fourth quarter.

HPT's hired portfolio RevPAR declined by 4.5%, primarily due to occupancy declines, high supply growth and OTA reductions, driven by efforts to drive more business through brand direct channels negatively impacted the portfolio. Our comparable Radisson Hotel Group portfolio RevPAR decreased by 5.9% due to renovations at six comparable hotels. Despite the renovation activity, coverage of our total Radisson renewal returns, was 1.1 times for the quarter ended 2018.

Turning to our hotel investment activities, in October, HPT acquired the Gainey Suites Hotel located in Scottsdale, Arizona for a purchase price of $35.9 million, an additive to our management agreement with Sonesta. All of the 164 suites have full kitchen. The hotel completed a full renovation in 2017 and accordingly will not require initial capital investment. The going-in cap rate at the time was approximately 8% based on last 12 months EBITDA through mid-2018.

In February, HPT acquired 335-room Kimpton Hotel Palomar located in Washington DC for a purchase price of $141.5 million. The Hotel Palomar marks HPT's first hotel in the district and IHG will provide credit support for this hotel in the form of an increase to our security deposit of $5 million. This hotel is well located in the Embassy Row DuPont Circle area of Washington and our going-in cap rate was approximately 8%.

Looking ahead to 2019, renovation disruption will continue, particularly in the first quarter. However, there will be fewer hotels under renovation in progress for the full year. We expect to have 43 hotels under renovation in 2019 compared to 72 in 2018. In addition, we are expecting to see positive lift this year from the 50 hotels that completed renovations in 2018.

HPT's asset management continues to be proactive with our operators to collaborate on various sales, revenue management and marketing strategies to be deployed pre and post renovation in response to concerns that higher supply levels might be a post-renovation result. With a positive economic outlook for 2019 and continued low unemployment, industry expectations are the growth this year will again be led by average daily rate improvement with occupancy levels that are flat to slightly down, such that RevPAR will grow approximately 2.5% compared to last year.

HPT's managers project that for 2019, we will experience RevPAR growth through rate and occupancy improvement, such that comparable RevPAR will increase between 2% and 3%. GOP margin is expected to be flat given continued pressure on wages and benefits. The combination of active asset management, strong brands, good locations and continued regular capital investment give us confidence that despite current headwinds, our operators will meet their projections.

Turning to performance in HPT's travel centers, total margin increased by $23.6 million or 8.1% in the fourth quarter due to a $19.1 million or 32.5% increase in fuel margin due to higher per-gallon fuel margins and flat fuel gallons sold in the 2018 fourth quarter, and a $4.5 million or 1.9% increase in non-fuel margin. Property level rent coverage for the quarter was 1.59 times, up 8.9% from prior year coverage.

In January, HPT amended its leases with TA and completed the sale of 20 travel centers in 15 states to TA for a total purchase price of $308.2 million, representing a 5.7% cap rate on property level EBITDA. We expect to record a gain of approximately $160 million from these sales in the first quarter of 2019. The aggregate annual minimum rents due from TA for the remaining 179 travel centers HPT leases to TA was $246.1 million upon completion of the sale. TA's percentage of HPT's total rents and returns decreased from 33% to 29% as a result of this transaction. Brian will provide more details on the impact to HPT's consolidated results going forward as it relates to this transaction during his remarks.

I'll now turn the call over to Brian.

Brian Donley -- Treasurer and Chief Financial Officer

Thanks, John. Starting with operating results at our 323 comparable hotels this quarter, RevPAR decreased 1.7%, GOP margin percentage decreased by 200 basis points and cash flow available to pay HPT's minimum returns and rents decreased by 13.6%, reflecting the negative impact of renovations, supply growth, difficult hurricane comparisons versus last year and increased operating costs.

The 1.7% decrease in RevPAR this quarter resulted from a 1.7 percentage point decrease in occupancy, partially offset by a 0.8% increase in ADR. Our comparable Wyndham and Radisson portfolios had the weakest RevPAR performance with declines of 12.5% and 5.9% respectively versus the prior year quarter. Our Wyndham portfolio was heavily impacted by non-repeat hurricane-related business in 2017 and soft market conditions. Our Radisson portfolio had six out of nine hotels under renovation during the quarter.

The portfolio with the highest RevPAR growth this quarter was our comparable Sonesta portfolio with an increase of 0.8% versus the prior year quarter. GOP margin percentage for our comparable hotels decreased by 200 basis points from the 2017 quarter to 36% and gross operating profit decreased approximately $10.6 million or 5.8% from the 2017 fourth quarter. Three of our portfolios are the primary drivers of this decrease. GOP margin at comparable IHG portfolio decreased 327 basis points to 37.5%, resulting in a $6.3 million decrease in gross operating profit, driven by the closure of the Crowne Plaza Ravinia Hotel, non-repeat hurricane business and wage and benefit expense increases. Our comparable Sonesta portfolio experienced a 280 basis point decrease in GOP margin, resulting in a $2.2 million decrease in gross operating profit, primarily driven by wage and benefit expense increases.

Our Wyndham portfolio experienced the 558 basis point decrease in GOP margin, resulting in a $2.1 million decrease to gross operating profit, driven by soft market conditions and non-repeat hurricane business. Below the GOP, line costs increased by $6.6 million or 11.4%, mainly due to a $5.6 million increase in real estate taxes and insurance-related costs. The decline in GOP margins along with the increase in fixed costs resulted in a decrease in cash flow available to pay our minimum returns and rents of $17 million or 13.3%. The two portfolios with the largest percentage decline to cash flow were our Wyndham and IHG hotels with decreases of 42% and 23% respectively. Cash flow coverage of our minimum returns and rents for our 323 comparable hotels decreased to 0.77 times for the 2018 quarter compared to 0.91 times for the prior year quarter.

Coverage for the 2018 year was 0.97 times for the consolidated portfolio and was above 1 times in all but two of our portfolios. Our available security deposits and guarantees increased by $16.7 million during the year, bringing the aggregate balance of available security deposits and guarantees at quarter-end to $228 million. At year-end, the guarantee under our Wyndham agreement remain depleted, and as John mentioned, Wyndham continues to pay us 85% of the returns due under the management agreement. On an annualized basis, the shortfall represents $4.2 million or less than 0.5 per percent of our total annual minimum returns and rents.

Turning to the performance of our travel center investments for the quarter, fuel gross margin increased by $19.1 million or 32.5%, primarily as a result of a $0.45 cent or 32.5% increase in per gallon gross margin in the 2018 fourth quarter. The increase in per gallon gross margin is primarily as a result of a more favorable purchasing environment in the 2018 period, while few volumes sold over the prior year was flat.

Non-fuel travel center revenue increased 1.8% versus the prior year, due primarily to growth of quick service restaurant revenues and store revenues, which increased 5.7% and 3.3% respectively. Non-fuel gross margin percentage was flat compared to the prior year at 61%. As a result, our travel centers grew non-fuel gross margin $4.5 million or 1.9% versus the 2017 quarter to $238.4 million. Non-fuel sales generated approximately 75% of the total gross margin dollars at our travel centers in the quarter.

Site level operating expenses increased $11.7 million or 6.2% from the prior year, primarily driven by increased labor costs, maintenance and property tax expense. Fourth quarter property level EBITDA of our travel centers increased by approximately $11.9 million or 11.5% compared to the fourth quarter of 2017, and annual minimum rent coverage under our leases was 1.59 times compared to 1.46 times last year.

As John mentioned a moment ago, in January, we sold 20 travel centers to TA for $308.2 million and amended our leases with TA. As a result of these transactions, cash minimum rents decreased by an aggregate of $10.8 million per quarter. Beginning in April 2019, TA will pay HPT $4.4 million per quarter over 16 instalments to satisfy previously deferred rent obligations. Under Generally Accepted Accounting Principles, we are required to recognize the deferred rent payments on a straight-line basis over the terms of leases.

The amended payment terms of the deferred rent will result in a change from noncash rental income of $2.5 million per quarter to a non-cash reduction to rental income of $3.8 million per quarter over the period we collect the deferred rent payments. Considering these changes, the aggregate reductions to normalize the FFO and adjusted EBITDA will be $12.7 million or $0.08 per share per quarter before any reinvestment of the $308.2 million of proceeds from the property sales.

Assuming reinvestment of the proceeds into new hotel investments, we expect our transactions with TA to be neutral to AFFO. On a pro forma basis, assuming the property sales occurred on January 1, 2018, annual minimum coverage of our leases would have been 1.83 times for the 2018 year.

Turning to HPT's consolidated financial results, normalized FFO was $100 million in the 2018 fourth quarter compared to $87.9 million in the 2017 quarter, an increase of $0.07 per share. We recognized $53.6 million or $0.33 per share business management incentive fee expense in the fourth quarter and full year 2018. We recognized $73.6 million or $0.45 per share in the fourth quarter and full year 2017.

Adjusted EBITDA was $149.8 million in the 2018 fourth quarter, a 10.7% increase from the 2017 quarter. Our adjusted EBITDA with the interest coverage ratio was 3 times for the quarter and debt to annualized adjusted EBITDA was 7.1 times at quarter-end. Excluding the impact of the incentive fees, these ratios would have been 4.1 times and 5.2 times respectively.

Turning to our capital improvement funding commitments, we funded $69.4 million of hotel improvements and $11.7 million of travel center improvements in the fourth quarter. In 2019, we expect to fund $260 million of hotel improvements and $30 million of travel center improvements. The majority of these improvements are expected to be funded from operating cash flow. We expect to have 20 hotels under renovation for all or part of the 2019 first quarter compared 23 hotels last year.

Turning to our balance sheet, as of quarter-end, debt was 41.6% of total gross assets, and we had $76 million of cash, including $50 million of cash escrowed for future improvements to our hotels. As of today, we have $161 million outstanding on our revolving credit facility and no term debt maturities until February 2021.

Operator, that concludes our prepared remarks. We're ready to open up for questions.

Questions and Answers:


Thank you. (Operator Instructions) Our first question comes from Michael Bellisario with Baird. Please go ahead.

Michael Bellisario -- Baird -- Analyst

Good morning, everyone.

John G. Murray -- President and Chief Executive Officer

Good morning.

Michael Bellisario -- Baird -- Analyst

John, just on the TA transaction, can you maybe give us your high level and strategic view on trading TA rental income for more volatile hotel income at this point in the cycle?

John G. Murray -- President and Chief Executive Officer

Sure. We think it's a good transaction for HPT for a number of reasons. Really since we entered into the transactions with TA and acquired TA years ago, we've had investors concerned about rent coverage for travel centers, even though the coverage of the travel centers was higher than our hotel leases, and this gets TA up into the 1 -- above the 1.8 level. And I think if you look at other similar businesses that are owned by publicly traded REITs, their coverage ranges tend to be in the 1.8 to 2.25 range. So we think that, that should provide more comfort to investors as we potentially head into a -- at some point in the next couple of years into a weaker economy. We think that investors -- the majority of investors in HPT are more focused on hotels and travel centers, and reducing our exposure to travel centers, we think, is also something that will be well received by investors, notwithstanding the different volatility dynamics. This transaction, the sale of the 20 locations represents the weaker performing 20 hotels in the portfolio. So we think that, that depositive (ph) results in a significant gain of $160-ish million, which is also a positive.

So we think taken all those considerations into account and giving -- given where our leverage levels, whereas the ability to dispose of some weaker performing travel centers and take in $300 million of capital for investment in hotels assuming that we can invest in them at roughly an 8% return is a good transaction for HPT.

Michael Bellisario -- Baird -- Analyst

Do you see an opportunity to do more with TA to further enlighten the exposure there going forward?

John G. Murray -- President and Chief Executive Officer

We are not currently considering similar transactions. This was somewhat opportunistic because TA made a strategic decision to exit the convenience store business, and we happen to be their most expensive form of debt, and so their planned use of proceeds was to reduce leverage. And so -- I don't think that they have any other strategic initiatives that's going to result in that type of proceeds and ability to just try to buy down our leases. So I think this is just a one-time event.

Michael Bellisario -- Baird -- Analyst

Got it. And then just on the CapEx front for 2019, I don't think you provided any round numbers for the portfolios, but could you maybe provide some guidance to your spending expectations for this year?

Brian Donley -- Treasurer and Chief Financial Officer

Yes. For 2019, $260 million is the estimate for the hotels and $30 million for the travel centers.

Michael Bellisario -- Baird -- Analyst

Thank you. That's all from me.

John G. Murray -- President and Chief Executive Officer

Thank you.


Our next question comes from Bryan Maher with B. Riley FBR. Please go ahead.

Bryan Maher -- B. Riley FBR -- Analyst

Good morning, John. Quick question on your outlook on the acquisition front. You've kind of been going back and forth between select serve and full served hotel acquisitions at kind of a moderate pace, maybe even arguably a slow pace more recently, particularly versus 2017. How are you thinking about 2019 skewing more toward select service or full service, and do you expect that activity to ramp up at all with renovation activity slowing somewhat versus last year?

John G. Murray -- President and Chief Executive Officer

Yes. I think that 80%-ish, 85% of our portfolio of select service are extended stay. And so -- and then the balance is full service hotels. So we really look at all offerings of hotels that we've become aware of, and we're open to buying either. We really -- we prefer to buy select service hotels or extended-stay hotels in portfolio transactions, not so much on a one-off basis. Since the Hotel Conference in Los Angeles back in -- at the end of January, we've seen pickup in full service hotel offerings, a more modest volume of select service activities.

So -- but I think it's -- I don't know that I would give a particular waiting, maybe I would go slightly more toward -- we're seeing more full service hotel opportunities. So maybe it's more likely that we'll buy more full service hotels than select service hotels. But we don't have a particular target. What's important to us is that we have geographic diversity, that we have portfolio transaction. So like, for instance, when we bought the Palomar in Washington DC, that was a hotel that could be added to our portfolio of 100 other hotels that we have with IHG. So we wouldn't have bought it on a stand-alone basis. But -- so as long as we can identify opportunities that -- where the yield is acceptable to us and one of our major operators is willing to add it to their portfolio, then I think probably we'll do a little bit more full service than select service.

Bryan Maher -- B. Riley FBR -- Analyst

I was just curious when you do acquire properties, it seems like there's been a little bit of a skewing toward the Sonesto brand more recently. Can you tell us how that decision is made internally or with the board as to how that property is going to be branded?

John G. Murray -- President and Chief Executive Officer

Yes. We have, first of all, just a policy that if there is a hotel available in the marketplace and one of the hotel operators that we do business with emailed us or call us and says, have you seen that XYZ hotel is available in the marketplace, we'd love to add that to our portfolio, then that's what we do. We focus on that acquisition opportunity with that operator because it was that operator and that relationship that first contacted us about it and brought to our attention. If we become aware of a transaction through our own networks with sellers that we've done business with previously or through the brokerage community, then we evaluate what it could be rebranded as. Oftentimes, the major brands will already have a very significant presence in certain markets and the ability to get the type of secure transaction that we typically seek wouldn't probably be available with those other operators. And in those circumstances, if the opportunity is unencumbered by brand and management, we consider Sonesta as a viable opportunity because they wouldn't be a brand that's over-represented in the market and the fact that we may not get -- that we don't get credit support from Sonesta, it wouldn't be sort of a disadvantage versus what we would have been able to get from any of the other operators in those markets.

So -- and then we presented to the independent trustees. Any time we do a transaction with the related party, the managing trustees recuse themselves from the decision-making on the investment we presented to the independent trustees. We present the alternatives of what else maybe the hotel could have been in terms of branding and then the independent trustees make a determination whether to go with Sonesta or not.

Bryan Maher -- B. Riley FBR -- Analyst

Hey, thanks. And then kind of going back to Michael's questioning on TAs, with the rollout of the TA Express brand in 2019, do you think HPT would be agreeable to assuming TA found a potential seller of a handful or a dozen or so smaller truck stop travel centers to maybe team up with TA to acquire TA Expresses and put those into the portfolio, or is that not something you're considering?

John G. Murray -- President and Chief Executive Officer

Well, it's not something we're currently considering. We never say never here at HPT, but we believe and we -- and I think that TA believes that the TA Express format is really a franchise product, not -- it's not a type of travel center that TA intends to become a big lessee on, and so I don't think that they would come to us with that type of portfolio. I think that they will be more likely to reach out to smaller travel center operators and existing franchisees to see if maybe they would be interested in operating those. But -- we think the competitive advantage that we have with our travel centers is that they are large format, they do have substantial parking, which tracks the professional truck driver as well as regular motorists. It gives them a place to be during the 13 hours that they're supposed to be off-road and allows them to shop in our stores and eat in our restaurants and get their truck repaired, and that's what makes up 75% of the bottom line that we see from our travel centers, and so we prefer to stick with that model.

Bryan Maher -- B. Riley FBR -- Analyst

And just kind of lastly, kind of maybe thinking a little bit out loud here, but given the size of the travel centers that you own and the number still 179, as you look toward growing the select service portfolio over time, do you guys ever give any thought to actually developing or having somebody develop select service hotels on an acre or two of those large parcels kind of across the country to kind of grow out the portfolio on the hotel side even more?

John G. Murray -- President and Chief Executive Officer

That is something that, from time to time, we consider. We've been approached by a couple of our operators about doing exactly that and you know what we've -- we haven't gone forward with this for a variety of reasons. One is because there's a lot of traffic moving around those travel centers and we want to be able to provide -- if we had a hotel on the site, we want to be able to make sure that they were safe, for example, walking from the hotel over to the restaurant, sort of the quick-serve restaurants, and that just makes us a little bit nervous given the amount of activity that goes on at these locations.

Another factor is that -- our feeling is that the motorists in cars popping in to get fuel or to get a bite to eat, but generally, they are in transit between locations, whereas the professional truck driver will park the car for a long period of time overnight or for whatever period to comply with safety regulations, but oftentimes to have -- to get insurance on whatever cargo they're transporting, the insurance carriers require that they stay with their cargo, that they have to sleep in their cabs, and as a result, the hotels don't generally get as much business from the truck drivers as you might think they would.

And so we actually -- when we first bought TA, a number of our locations had hotel rooms in the upstairs area of the travel centers, and we've gotten rid of those over time. So it's something that we continue to take a look at. I would tell you that we've -- because our (inaudible) involved in a number of different types of real estate in some of the travel centers where we do have a fair amount of excess land, we have evaluated other potential uses for -- for example, there may be opportunities to develop industrial buildings near these travel centers on the excess land. So that's -- again, that's not something that is going to happen near-term, but it's something along with hotels that we can -- we will continue to periodically analyze and may do down the road.

Bryan Maher -- B. Riley FBR -- Analyst

Okay. Thanks. That's all from me.


This concludes our question-and-answer session. I would like to turn the conference back over to John Murray for any closing remarks.

John G. Murray -- President and Chief Executive Officer

Thank you all very much for joining us today.


The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.

Duration: 37 minutes

Call participants:

Katie Strohacker -- Senior Director, Investor Relations

John G. Murray -- President and Chief Executive Officer

Brian Donley -- Treasurer and Chief Financial Officer

Michael Bellisario -- Baird -- Analyst

Bryan Maher -- B. Riley FBR -- Analyst

More HPT analysis

Transcript powered by AlphaStreet

This article is a transcript of this conference call produced for The Motley Fool. While we strive for our Foolish Best, there may be errors, omissions, or inaccuracies in this transcript. As with all our articles, The Motley Fool does not assume any responsibility for your use of this content, and we strongly encourage you to do your own research, including listening to the call yourself and reading the company's SEC filings. Please see our Terms and Conditions for additional details, including our Obligatory Capitalized Disclaimers of Liability.