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add97c4e2e9e86c2cea4fa2ff0581eef | OK. All right. So if I subtract that out, I'd come up with ARR up about 3% Q-over-Q, cloud ARR up about 4% Q-over-Q, which is about the same rate as the prior quarter. But it does reflect an ongoing year-over-year detail of both the ARR and cloud ARR. That's because the year-ago Q-on-Q increases were larger. So the que... | Yeah, that's correct. | direct | [
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0662931af9a72f05935b7e9f5a997a74 | OK. All right. And so does the slower Q-o-Q growth relative to a year ago, continue to be driven by pandemic-induced job cuts? Or is it something else going on? | It's been exactly that. As we've seen, getting back to the 100% ARR growth is a great thing, and we're pleased with that momentum. If we think it talks to the power of the rotation, the cloud and our position, helping our partners take advantage of that. But the overall environment is not as strong as it was a year ago... | intermediate | [
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afede3c9c0bfd5c60db38d228ab5922e | Got it. OK. And then finally, you did talk about your net revenue retention rate. It did improve. It improved about 100 basis points Q-o-Q, correct? | That's right. | direct | [
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c8681d0f3b0d225144373eff2426c49d | OK. And can you just discuss what were the drivers of the improvement, the components of that between churn versus upsell, relative to the quarter ago? | Yeah. It was a combination of both, actually. So we're very pleased that churn, specifically around productivity, advanced threat protection, archiving and CloudAlly, the -- it continues to stay strong. As Dave mentioned on the call, a little bit higher churn on the encryption and on hosted exchange or specifically the... | direct | [
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0d5a67de7d420fb0f8bf077d977e1dc4 | So just kind of questions on Secure Cloud and now that we've seen a significant amount of the cloud ARR base kind of converted or in that product or suite, and it sounds like a lot of the new -- net new logos are directly flowing in there. Are we at a point where you can talk -- either one of the Davids, on Secure Clou... | Yeah. First of all, on the Secure Cloud rotation, what we were really successful with in 2020 was getting the new customers, 99%, coming on to Secure Cloud. 2021, to be clear, is the year where we'd be bringing over large cohorts of customers from the Zix Cloud and the Secure Cloud. That movement, as I discussed, start... | intermediate | [
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a9283e3209ed5bab7158f180d8ce3485 | OK. Are we on track with that and kind of how do you think about that? | Yeah, that business is out of the gates, really, really strong. The team is integrating and executing. One of the things that's working better than we thought is the Salesforce back up market. That -- there's a lot of really important data sets in Salesforce and they're increasingly pointing their customers to the need... | direct | [
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605b4cd71f32419035b2f8e82730ff60 | OK. And then maybe one last one. I think you commented on it a little bit on the previous question. But just what are your thoughts as we stand here today in 2021, just on the stability of net retention and churn relative to maybe kind of the end of the last year? Do you feel like things are improving? Or you have more... | No, the good thing is that relatively strong we've experienced since June, July has stayed in a pretty relatively strong position since then. We're looking forward to a much stronger second half when the vaccines around, people are really moving again. It's -- as you know, the overall macro is -- from the way we see it... | direct | [
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1c6d459ac71168e056aee74f590310c2 | I just wanted to start off maybe digging in on the top-line beat and kind of what you guys -- what products drove the strength in excess of your guidance? And then also, maybe if you could just touch on what you guys are assuming from a macro perspective, just curious if you're baking in any sort of economic recovery o... | OK. I'll take the front part of the question around the beat on the revenue side. Of course, we continue to see strength in the Office 365. So that provided a part of the beat for us. And then I would say end of Q3 and Q4, the attach of the Zix IP products onto the -- what was historic AppRiver platform, we saw that --... | intermediate | [
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190c21f6e5fca8f886562c982fd45522 | Got it. All right. That's helpful. And then as a follow-up on that, I mean, just touching on one of the initiatives that you mentioned for this year, migrating your legacy Zix customers over to the Secured Cloud, you mentioned higher churn rates in that customer base. I'm curious if there's any investments you think yo... | Well, a lot of it is execution. The hosted exchange is really the one that we're really focused on. We enjoy a higher gross margin on hosted exchange business than Office 365. But we know that the future of Microsoft and the future of productivity is in the cloud. And so to sit and watch that base go down is we don't t... | direct | [
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f1ee2de1c719442cbb6252c8c8616286 | Got it. That's really helpful. My last question was just on the international business. Obviously, seeing really strong growth there. I'm curious if you could provide some disclosure on what your international ARR growth rate has been or what it was in 2020 and kind of what you see that being in 2021? And maybe what th... | Yeah. It's growing really well. We have a really strong team there. And as they've grown from nascent two years ago, this year was a doubling. It's still sub -- meaningfully to sub-10% of ARR. But we could see them getting 10% of ARR in the next year, year and a half. Just the market there, the IT providers needing to ... | intermediate | [
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3cd7e1b7eb9074b0688e8a0a7822fa8e | So just over the course of the pandemic, we've seen a slowdown in your ability to add MSP partners as a result of the pandemic. Can you talk a little bit that impact from this last quarter? And then also what your expectations are for that going forward into 2021? | Yeah. So we should put the number out. This quarter was a little bit better than last quarter in terms of the number of MSPs added. So we're continuing to add MSP. It's just a little bit slower than, again, than the pre-pandemic pace. But the focus for this year is a laser focus on larger MSPs. And so we're building ou... | direct | [
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d42c055e181e4c08651a0ecf0dbaffff | Great. And then just last quarter, you guys announced the hiring of a new product officer, Ryan Allphin. Can you talk a little bit about what he's done in his first three months there? And how he fits into the larger strategic view of the company? | Well, yes, thank you for asking. He's a tremendous, really big add to leadership team. Ryan brings experience not only in building platforms, but looking carefully at the data sets and artificial intelligence, and how to think carefully about how we take the information that we have uniquely have for our partners and c... | intermediate | [
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6ec466e4339f8788f04befe49065c089 | Maybe let's start with the margin. I want to make sure I understand the message correctly. Should we think about the second half of this year, the margin increases beyond the balance sheet actions that were last quarter? And if so, can you just run through again what do you think drives that core margin expansion? | So, Terry, this is Rich. That transaction occurred late in May. So we really didn't see that entire impact obviously on the quarter numbers or even the six-month numbers. And I would expect through our modeling, if we said 17 basis points of growth in the margin for the -- over a 12-month period or annualized, we're lo... | intermediate | [
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68ec667db37b66695dd92e4de99dc575 | I guess, beyond the transaction that occurred in the math you just ran through, was there some -- were you implying that there's additional margin expansion above and beyond there as you reduce funding costs and those come down lower? | Well, certainly there's some room to bring the funding costs down. Don't forget about that kind of stimulus. I think the technical term is snafu. That will occur right at the beginning of the year. So we had 16 basis points of drag on our six-month margin for that. And that will continue to diminish as the year runs ou... | intermediate | [
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49816e77195b4c28966683ed454f8f86 | Thanks for clearing all that up. And then just as a follow-up, the outlook for mid-single-digit loan growth this year, it looks like the non-owner occupied CRE was really the bright spot in the second quarter. Do you think that's going to be the driver of growth in the back half of this year and maybe talk about just m... | Yeah. Terry, this is Chuck. Obviously we're -- that's our bread and butter in that non-owner occupied real estate. We have still really good demand. We've got really good pipelines right now. We've been a little softer on C&I really more so from a -- from just the amount of cash that companies have from all the governm... | direct | [
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d81c19378e9d0174b67d08f6c3e6b882 | In terms of accommodation deferrals, do you have a breakout of those hotels that are leveraged to business travel versus those that are more destination or vacation oriented? | Yeah, this is Paul Stark. Virtually all of the hotels are more leisure travel than business. We don't really finance too many of that are focused on business. That's not to say there's not some that are mixed. So -- and for the most part, a lot of those, I think, over half of our deferrals are on hotels. Almost -- of t... | direct | [
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a6a69398f9b4cf42031b5a204c638144 | Okay. And then with respect to swap fees, slow down relative to 2020 levels. I know they can be volatile, but are you expecting a pickup in this line item or staying at this level for the time being? | I would tell you, Nick -- this is Chuck. I would tell you it would probably be pretty close to the same level through the back half of the year unless we see some major change in the yield curve. Right now, it makes more sense for us to go a little longer on some in-house mortgages than to take that LIBOR plus 225, 250... | direct | [
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73764f83659f3c4edcd047f1cd329b67 | Okay. That's fair. And then lastly, the tax rate bumped down a little this quarter. What are you expecting on a go forward basis? | I'm not sure what is it bounced down to? But going forward, I think we got 13%. 13% is probably a good run rate going forward, Nick. | direct | [
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2e3453596943d1a804a19339fdb6786d | Hey. Good afternoon. This is Tim Switzer on for Mike Perito. You guys have pretty strong capital levels on right now, and there's still a good amount of buyback authorization from the Board, around $7.4 million. So I was wondering, do you guys expect to kind of keep a similar buyback pace for the rest of this year assu... | Well, yeah, I think from the capital level, we've kind of publicly stated from the TCE standpoint anyway we've been trying to manage the company here about a 9% level there or above that. So, I think we're about 9.5% or so. So we've been fairly aggressive and we think we're undervalued. And because of that, I think we ... | intermediate | [
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b7e4070fe620fe7d711458f3eb26cbd1 | Great. Thanks. And then, I had a quick follow-up on -- your adjusted expenses this quarter are pretty solid. You have good efficiency ratio of sub-60% despite some of your tech initiatives. So, do you think you can kind of maintain that efficiency ratio near the 60% level going into 2022? And I guess, just sort of what... | So, Tim, this is Rich. And the short answer is yes. But I think if you're -- as you get familiar with the bank, I mean, we were kind of front-end loaded with the tax money. So we've got maybe more revenue in the first and second quarters. So, the low point of our efficiency ratio for the year is the first and second qu... | direct | [
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7a66fe84e1ed53bade68338de50d525e | Great. Yeah. And do you have any targets you're willing to share on kind of how quickly you think you could accelerate your account growth at all related revenues? | We'll be working pretty hard on that, maybe the back half of this year. But really most of that effort right now, I mean we've got some really conservative efforts, but we'll spend a little bit more time on that at the back half of this year as we head into next year. So, maybe I will share some things later and maybe ... | intermediate | [
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1acbba0c9cb9c8088cb29f6ff7be3cdf | Just a few couple of follow-ups here. First on the loan growth, so second quarter, ex PPP, turned out as strong if not stronger than you guys were expecting. And so, just curious as to your thoughts for the back half of the year. Any potential for upside to that mid-single digit number and just what the loan growth dri... | Yeah. Russell, this is Chuck. We do -- I mean, we might have a little upside. One of the things I'm watching pretty close is we've got quite a few construction -- large construction projects that are coming to fruition and coming to an end. So, we're staring quite a bit of, what I would call, payoff money in that third... | direct | [
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f133375542040201082f62b5eea25d9c | Understood. I appreciate the color there. And then, just last one is a follow-up to the margin discussion. So, I think you guys mentioned an additional kind of 10 basis points from the balance sheet restructuring, talked about some other positive catalysts like funding costs, reduction and putting some of that excess l... | Well, I mean, I guess the math on the back of my sheet says that normalized, we need the PPP and whatnot, I guess that's the wildcard, Russell. PPP and how quick that prepays. So, I guess if you take that off the table, I mean, it could be a 3.7, 3.8 kind of number. It just depends on the PPP. | intermediate | [
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19f9bc79dc049267ef8199bcd0c6e9ab | I was hoping you guys could drill down a little bit more on the prior year development and tell us why should we expect reserves now to be adequate? And I guess more of a big picture question is, how is the strategy changing for 2020 in the context of this year shaping out to be a loss year? | Sure. This is John. I'll take that. So as we try to emphasize in our remarks, we are adopting a more conservative reserving strategy, especially as it relates to the cat events because these nonhurricane cat events especially have shown development patterns that differ from the historical record.
And we have 20 years'... | direct | [
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40fb7088dc78b5de5c78310e728830fd | OK. And I guess switching to premiums, and there's some healthy organic growth, and you guys singled that out in your remarks. But I'm looking at the assumed premium line. That's down 47% this quarter. Can you guys give us more color there? | Sure, this is Brad. I mentioned in my remarks that, that was down because of the -- we have three quota share agreements with three E&S carriers that participate in the AmRisc commercial E&S program. And one of those three quota shares went into runoff. | direct | [
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42fc86401e339d275df8d79dd9a2919e | OK. And I guess my final question would be, if you guys could just give us an update on AOB, and what you guys are seeing out there, if it's getting better? And anything you could tell us on the Journey, that would be great. | Sure. The AOB legislation was good legislation, but the AOB machine in Florida has not been deterred by that. We still see AOB lawsuits coming in at rates that are higher than they were in 2018. Again, for us, it's not a significant factor because it's mostly a tri-county phenomenon. We don't have a lot of business dow... | intermediate | [
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8b7c2e01927c1e717e63b23842e55e3e | So just firstly, on Hurricanes Michael and Irma, where did you see an increase in gross losses in either of those storms? And how much IBNR do you currently have remaining for each storm? | Yes. We've seen an increase in gross losses for both of those events, where we bumped our reserves on Irma by about 20% to up to about $1.2 billion. Brad has got to get the IBNR number. We have a significant amount of IBNR on that. And Michael, I think, went up by less than 10%, and Brad will have that number too in a ... | intermediate | [
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8d6fab7e57841e89fb6a7593d35b1d21 | OK. While Brad gets those numbers, I'll move on to the next question. So catastrophes come in at $50 million versus your $46 million preannouncement. So just wondering what drove that delta? | The delta was primarily our BlueLine affiliates, the commercial E&S business that we didn't have absolute clarity on. We went a little bit more conservative at the end of the day as well. So cat was a little higher than previewed. Reserve development was lower than previewed. Net-net, it was very, very close to the pre... | direct | [
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332bc71c74425bb5d5c8bd876d38ce27 | OK, great. And I know it's a little early to talk about the reinsurance renewal, but do you think the recent elevated Japanese typhoon activity could impact your upcoming renewal? | We would prefer not to speculate on that. As we mentioned, we have a strong panel of really good reinsurance partners that have been with us a long time. We have win-win relationships with them. We're always seeking to diversify and broaden our panel, and we expect to work collaboratively with our reinsurance partners ... | fully_evasive | [
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330ad8a71cebea5b1fecf5e455bb4be8 | OK. And then just following up on the earlier AOB question. So it sounds like you aren't seeing an impact on your financial results. So is it also correct to infer that AOB so-called benefits won't be impacting rate increases going forward since you've taken quite a lot of rate increases in Florida this year? | Right, and continue to take rate in Florida. It's not specifically related to AOB. It's just more related in Florida to the elevated level of nonhurricane cat losses because our noncat loss ratio in Florida continues to decline, not go up. So that's not driving our rate need. It's the cat events like the hailstorms and... | direct | [
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684ba585bb88dc57fb56d98ca2eb9dcb | Right. Then other than the rate increases, are you taking any other actions to improve underwriting results? | Yes, and we've talked about those extensively and included them in our investor presentations in the past, which I would encourage you to review. We've got a whole host of underwriting agency management initiatives that are under way that we're seeing good effect from. | intermediate | [
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cf84258d315d46e0bccdf1271096f6f6 | OK. And then just lastly, given all the rate changes that you've been taking, some of the expense movements, where do you currently see 2020 loss and expense ratios settling in at? | Right. We don't give forward-looking estimates for that kind of information. So we continue to see downward trends in our noncat loss ratios, and we're working hard to manage the cat loss stuff so that we have enough rate in our book of business to handle it. I think Brad might have the numbers you were looking for ear... | fully_evasive | [
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00b4616b3f3ec30b2d76ca95b6102e99 | Just a little bit more color. And I think you touched on this in your slide shows. But on the rate increases, what's the competitive market looking like in Florida? As you take these rates, are customers staying with you? Are you losing people? What's the net effect? | Our retention has stayed strong in Florida, Cliff. Even with these rate increases, the market has changed. The landscape has changed a lot, and there's a lot of companies out there that are paying losses on the same events that we're paying losses on, and it's a difficult operating environment. We happen to be relative... | direct | [
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5dc597f4857bcfa7c9b630ddc36c62d7 | Also, I was wondering this sort of happened in October, but we had these tornadoes come through Texas. Was that a geography you're exposed to? Or do you have any comment on that event? | Yes. That was a Q4 event, and we did have, as of yesterday, we had 37 claims on that, with incurred of about $1.5 million. | direct | [
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0ba470671edbb2f85e9cc6230846b56c | I just was hoping maybe you guys could give us a quick update on the Journey, and how you're leveraging the A.M. Best rating? And when should we expect to see that flowing through financials? | Journey is launched in Florida, currently writing commercial residential business focused on apartment buildings. We've gained momentum consistently on Journey throughout the year, just had our best month ever. And our partners at AmRisc are doing a great job on the marketing and distribution to help agents get comfort... | intermediate | [
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1db66ccf3f1dc1bfef60cc67d36bd906 | Roger, welcome. I want to get a sense of what have you learned in the first few months on the job that has got you excited or got you nervous? | Yeah. Well, I think the company has great products. We're in great markets. I've been really impressed by the team here. I think everyone's doing a great job. I'm very happy, particularly on the finance team. As you -- when you come as the new CFO, I think you're always concerned is everything buttoned up. And I think ... | intermediate | [
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1d94e73930dec2d1b75afc1ed92ad09b | And the guidance was maintained but it kind of says, assuming that early third quarter we get back to a more normal level of customer activity, we're sitting here on Cinco de Mayo, which means Q2 is almost halfway done. How should we think about the visibility of that customer returns activity by early Q3? | I think, overall, you know, it's looking better and better. I think that -- there have been a couple of months since we issued that statement originally and since then we've seen a great uptick in our demand for VSAT products, ARPUs are up, great response to our new product. So it seems like, you know, the markets are ... | intermediate | [
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99867e01df96c1eedffc861b43cb015a | The industry has gone through some interesting items, M&A, JVs, Orcan got an offer to go private, ViaSat did close its RigNet deal last Friday. How are you thinking about your balance sheet and what you see as far as opportunities in the space given joint ventures, M&A, or other items? | Yes, I think, you know, you're mentioning things that we internally think about a lot. And I think that the industry is consolidating a lot of our competitors, have gone out of business or gone bankrupt, or been acquired, and primarily, you know, they had too much debt but we've been growing market share, we're growing... | intermediate | [
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9a1d0a5832c7c38a7cae7a744d8e95bb | And finally for me is, obviously, some activist shareholders are starting to take a look as well. After I saw that I did see the board refresh announcement. Can you talk us a bit about what you think the pressure points are what you can do to address some of those? | Yeah. So primarily, today, I'd like to talk about the Q1 earnings and the great progress we're making there. You know, we did put out a press release announcing that we have two fantastic new directors. If you haven't seen it I'd encourage everyone to take a look at that really strong background in maritime as well as ... | fully_evasive | [
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5556f7323883dd7675074bdb23119428 | Martin, I want to follow up on a point that you made in terms of network costs and migration. I thought last quarter you had mentioned cost savings of $4 million to $5 million, and now you're saying $12 million. First of all, is that correct? | Yeah. So let me clarify that. So the total network costs that will be shedding around $12 million if every single one of those customers moves over to the HTS, we will be adding capacity on HTS in the order of -- let's call it half that. So the net savings, if there were no additional subscribers and if everything stay... | direct | [
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08233626a8b7a2ee7e63d2eeeb510557 | Got you. And so should we expect like a big bump in Q1 of next year in margins and then they kind of go down a little bit as you continue to add capacity onto the network? | No. I don't expect the margins to go down. I think the margins will go up next year and then they should go up every quarter. And they don't -- we don't anticipate any step-function increases in-network cost. It'll be incremental as subscribers grow. So we should see a nice bump in margins next year and that should tra... | direct | [
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1327f7597b662682151d18d56ef92314 | And again, it still sorts of longer-term trending toward the 40% level from what was it 34% this quarter? | Yes. Yep, that's still a good internal metric that we use. And the reason for that is that as we add subscribers, the cost per subscriber goes down for us in terms of whatever the fixed costs are. But also in terms of maintaining our competitive pricing in the marketplace, we probably won't see margin higher than 40%. ... | direct | [
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c8cae691bf79b6687b945b55cdce2891 | Understand. And sticking with the margin theme, product margins, overall, were up substantially and I guess most of that was product mix with the benefit of TACNAV sales. But more, generally, as you look across the product lines and certainly with the shift to the new PIC, should we see a sustained lift in margins acro... | Well, I'll let Roger add -- answer that in detail. But at the macro level, you know, we have fixed overhead and factory costs and factory utilization is a big part of our margin calculation. What we're seeing is increased demand both in our fiber optic facility as well as in our SatCom facility, so that fixed component... | intermediate | [
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c699efcf166b9d1f605fab053e6c75c0 | Understand. And you mentioned ARPU, I mean, typically, you haven't for at least but the last couple of years you mentioned ARPU. The fact that it was up this quarter, would you attribute that to just a lift in usage patterns or is it the type of service plans that individuals are signing up for? | Oh, we've seen a big increase in usage. So that's number one. Number two, we have some new rate plans that are intentionally designed to be more attractive as you go up in plans. Our HTS entry points are a little bit higher than the exiting old Arclight legacy network entry points. So I think that helps. So as I mentio... | direct | [
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a89c3504a71d88683f74da3b70775e9a | Great. Just a question on network capacity as you shift from mini-VSAT to the HTS network. There is somewhat limited global Ku-band HTS capacity, a handful of new satellites coming online over the several years. Any concerns around capacity constraints and any plans in the future to add a Ka-band-type network? | Well, we don't have any plans to do Ka network today. You know, we -- as you know, we also have a C-band network that we use as well as the Ku-band network for a dual-mode product like the V11. We have Ka-band products like our UHC-7 for the satellite television market. But where we are today, we've got a lot of capaci... | direct | [
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61d55f7778fd638b1ba3561f2bb5f6d2 | Great. And final question, TACNAV large orders pipeline, how is it shaping up this year? | It's -- I'd say, OK. We have about, I think, 70% of our annual forecast already in backlog, which is good. Still have some to book -- book and ship this year. So I think we're about where we expected to be but we're not done. | direct | [
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612129ac775c365f9e19639b9a4b8c8c | Any major program activity with the DOD or other foreign customers on track? | Yeah, there's a lot of different programs that we're pursuing. There's no single program that we have in our annual forecast or budget that we're counting on. So it's really a mix of smaller ones that would get us there. So you know, obviously, any large program would push us way over the top right. | intermediate | [
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6504b0d6a06ec9363706a51534d91ff2 | Eric, I first wanted to ask about your earnings profile. Here, you're making some incentive fee, an 8% NOI return, which you set out to do initially. So congrats on that. But the MVC assets will eventually move off, originations will come back to earth as you seem to say and I think there was some good repay fee income... | Yes. You're just trying to get to the sustainability question, I think Fin is that right? Yeah. So listen, I mean, I think the MVC assets, I think it's a mix, right? So you got the equity that's earning 0 from a current income perspective. And if you look at it, the second largest asset is one of those. Obviously, you ... | direct | [
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969b996081e7849f66e64179ed43e42a | I missed the pipeline number at the end with Jon, if you could give us that. But also perhaps for Ian as well, on the quality of the pipeline, we're hearing both that competition is fiercely back, but also that there's a lot of demand from sponsors for their M&A plans. So just some high level -- it sounds like there's ... | Hey, Fin. Maybe I'll start just with the market and then Jon can cover the pipeline for you. And just taking a step back, the fourth quarter was incredible, unlike anything I've ever seen in my career in terms of the volume of high-quality assets. And I think looking at the economy today, the monetary and fiscal suppor... | direct | [
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e07707307edb6e4e85bed2635713db47 | I wanted to dig into credit performance a bit. Obviously, it's been strong, no nonaccruals. But I just want to get your sense for kind of underlying trends in your portfolio companies in terms of revenue and EBITDA growth and your expectations for '21 as comps? And I guess the big question here is, are we really throug... | Yeah. So this is Ian. So I guess I would start by saying that just again with the monetary and fiscal support, the economy, obviously, is doing better. It's headed in the right direction. Have we fully recovered? No, we haven't. Is there a risk that we could derail somewhat? Yes, that's possible. But we're certainly wi... | intermediate | [
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cddc1904081c29a70d8d09478b970974 | And then just one follow-up on the MVC portfolio. I just want to make sure I understand the strategy there. Obviously, high-yield component to the fixed income assets and then -- but obviously, an equity, a high equity content there. Is there really just monetizing the equity and holding onto the fixed income assets as... | Thanks. I would say that the goal is to make sure that we're maximizing kind of profitability you'd find that over -- and that can come both on the appreciation side of things as well as the income side. Eric mentioned the stability of the earnings profile. And the stability of the earnings profile can come even as inv... | intermediate | [
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662215ff9aa40673d014738e868a9a6f | Hi, guys. And congratulations on another good quarter and getting into that incentive catch-up. First question, Jon, you actually pre-empted the first part of it. But on the CSA, your comments improved long-term outlook. Can you give us any color there? Is that a higher expectations long term for equity and may be neut... | Good question, Robert. I'd argue that if you look at the debt profile, just given the improvement of liquidity there just as general across-the-board improvement. And the equity values, if you think about how the CSA is longer term in nature and it's valued based on a series of outcomes, right? You'd find that equity v... | direct | [
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03c60f751ccca2f2eb891c9f767424da | On I think Page 12, I like this every quarter. On the middle-market segment, I mean, I see there spreads flat versus last quarter, leverage flat the last quarter. Average interest coverage down about half a turn. Is there anything, obviously, generally speaking, lower interest coverage is slightly worse than higher. Is... | Well, I'll start and then I'll kick it over to Eric and Jon, Robert. Just from a market perspective, in terms of the deals that we're doing comparing fourth quarter to first quarter, there's really not any change when you look at the key metrics of leverage and spreads and LTV. You'll know that has materially changed. ... | intermediate | [
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4a927a2ee77a950916bae507ce73310f | Looking at Slide 14. Obviously, the two largest positions in the portfolio are both from MVC. So I think it would be helpful if you could give us some color on those two companies, Custom Alloy and Security Holdings. And then secondly, if you could give us some definition as to the differentiation between the two JVs? ... | Casey, this is Bock. So we don't comment on individual portfolio company performance. We'll try to make sure that we give it to you a sense in aggregate, Casey, but we try to stay along the lines of at the end of the day, we look at things in context and are finding that the general performance of those loans is effect... | intermediate | [
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4bd43178fb44bc88d2d15632693f4e9e | My first question was actually similar to Fin. I'll just ask it a different way. I'm curious, is it your goal to, over time, increase earnings above the 8% hurdle? Or do you sort of consider -- or I guess is the goal to generate sort of earnings around that 8% hurdle and just a very stable fashion? | That's the last one. There you go, Bock. I'd say. Think of it this way and I hate to say it's a both and, but we've said all along that our strategy is kind of boring, predictable, highly diversified, making sure we consistently generate that 8-plus percent. And this first quarter, we've gotten there from -- after we b... | direct | [
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9b68e251074a1617ff4a135a5244bea6 | On the JV for Jocassee Partners, I don't believe, and you can correct me if I'm wrong, that you earned any income from the JV this quarter. I believe it's been retained. And I think that's been the same for the last few. Again, correct me if I'm wrong. But -- so are the plans there to eventually distribute earnings dow... | It's a good question. We'll kind of start with maybe just a higher-level concept where at times joint ventures in the BDC space became the tail that wags the dog. And there is a point when if you're overly reliant on and effectively over-leveraging credit spread asset to generate a higher return to maintain an improper... | intermediate | [
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195c19d830e4a44a48d889ad2c7d3575 | John, I just wanted to start by saying I think you missed the line in the guidance, no EPS guidance. And I'm just curious what the thinking is there, given there are so many moving parts, I guess that would have been helpful to have the EPS guidance in this particular quarter. I'm just wondering what your thought proce... | Yes, Brian, I think over the past few quarters, we've given the revenue range and then the qualitative information on the expense lines. And actually when I do my modeling that actually work so better because the revenue range really can swing that EPS range quite a bit, whereas our expense levels, particularly in the ... | direct | [
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957f3e4592d1374a79fad3a61cb8fc60 | When you look at the unique product developer count, I'm looking at the fourth quarter move sequentially, and in a normal year, seasonality has the developer count down about 3% sequentially in the fourth quarter and we saw that same seasonality this year. I'm wondering why it's not a more -- why that metric wasn't a l... | Yes. Brian, I think as you look at it, you got to look at the individual services and the performance related to it. And when you look at it from that perspective, they are correlated. So our CNC business has been hit the hardest as we look at it, and revenue is down the most in that service. And the average order size... | intermediate | [
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2b60b595f7e23c3a46d83a4d6f8c3c7a | With the roll out, it sounds like it went as you planned with Protolabs 2.0 in Europe. Are you seeing any bright spots there, in terms of like leading indicators that this will have a material impact on the level of customer interaction, customer retention, is it too late? I'm just wondering if there is anything that y... | Sure. This is Rob. Yes, we went live in Europe in November and we went live in the U.S., February 1st, so just a few weeks ago. The best initial indicators that we have is new customers and customer counts coming to the website and uploads and customer orders, all of which have been very good, very strong and we've got... | direct | [
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e043310e24de52a18cda9c732df722d5 | I had to jump off, just briefly. So, I heard you comment about flatness in January, February. and I'm just wondering -- it sounds like that's consistent with some of the normal seasonal patterns, but I'm just wondering is there any color that you can provide with respect to some potential recovery in some of your end m... | Yes, I can take that. So when you look at January it was pretty flat with December, that's pretty normal. January normally starts very slow as product developers emerge from the holidays and begin to get back to work and it picks up throughout the month, as it did normally this year. But in total that was pretty flat w... | intermediate | [
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2548cfe227d80dc37bf51925f7ad9416 | Again I apologize if you may have covered this. But as we think about '21 and the potential that you might have to do, you might be layering back some of the temporary cost actions or benefits that you saw in '20, just as it relates to COVID, whether it's travel related or trade show or anything like that. Is there any... | Yes, I think, I'm trying to provide the color for where our first quarter operating expense levels will be. And I think as you project forward, looking at those levels is probably the right place to start. We will be looking at where volume is coming in and what costs we can manage and adjust as we adjust to the volume... | intermediate | [
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bb1373c71f83b52387a4762edb387f23 | So my first question, I think it's related to 3D Hubs. Could you just talk about your expectations for kind of growth in that business and how that could impact revenue over the course of the year in terms of just -- whether that business is more geared toward prototyping and just kind of demand trends that you saw in ... | Yes. Kenny, I think it is a new business for us as well. We've done our diligence, we see the opportunity. As we were looking at it, we were acquiring the platform to build off of and really serve our customers in a broader manner. As we looked at it, I think we talked about 2020 revenue was about $25 million for that ... | intermediate | [
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c47b61abd210c82dfdf19bbd2acc99c9 | And then as a follow up, in terms of the end markets 3D Hubs is exposed to, is it kind of roughly similar to Proto Labs today? Is there anything you'd point out there in terms of -- the type of customer base that they are exposed to, will have any type of material impact on Proto Labs going forward? | Well. So as I said, the services to the types of parts that they produce are very highly aligned in terms of the four services we offer. They bring the benefit of -- again, as we talked about broader envelope of opportunities and a broader range of price points. So the customer overlap is actually relatively small in t... | direct | [
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b0af9caccb3721b9ac028378697316e3 | I have two questions. The first one has to do with losses. I understand that the calendar was unfavorable in the concession area, however, I would like to understand and maybe you could give us some color about it. How are you positioning ourselves as you are close to the target of the regulator, how are you positionin... | Thank you for the question. This has been exhaustively discussed with the regulators and now when the company is in the sector and there is a positive side to these talks and the idea is to preserve liquidity, not for the company alone, but for the whole sector. We believe there will be an increase in costs and -- the ... | intermediate | [
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32387d1f545613c41613186bf0b86e61 | Just to add to what you said, is ANEEL sensitive in terms of mitigating the impact during the pandemic, mitigating some situations of losses, do you see any goodwill on the part of ANEEL. | Well, as we said, the first impact was that and we have been discussing this with ANEEL and the losses as they are stable. We have already opened a discussion with ANEEL and we have already submitted this concern to ANEEL, not only our company, but all the companies in the sector, because some period you have no cut an... | intermediate | [
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a85215b8a551cb7d671d665470fd9a2c | I have two questions. The first one has to do with the decree that everybody is expecting with the package of adjustments and will be leaving open the economic side and I would like to know if the idea is to have something very clear that is to say, guaranteeing some financial measures and in this decree, do you think ... | As I said, for the decree, it's very much focused on the financial side. So it is basically a measure to anticipate cash or bring forward cash. So this discussion regarding equilibrium is under the responsibility of ANEEL and [Indecipherable] industry itself. So we expect a decree in this direction. Our expectation is ... | intermediate | [
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e793322d140b72fa39e17e78682af5d2 | Just wanted to follow up on guidance. So given your forecast of 2% to 3% same-store growth just wanted to -- wonder if you could walk us through how we get from there to only about 1% FFO growth at the midpoint. And so you've got your acquisitions and your disposition, so there is some level of dilution from capital re... | First of all, just to address the G&A. We're -- our guidance is assuming roughly $18.5 million to $19 million for G&A, so that's good for the year. As far as the non-cash revenue I think I mentioned in my prepared remark about we are seeing a drop of about $3 million in FAS 141 revenue in 2020 over 2019, which is bette... | direct | [
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549fa54ca9d4bf5cf667d475baf4f10b | So how much of that is -- in terms of pennies on this chair or are we thinking about it in terms of the impact of capital recycling and deleveraging? In terms of the timing expectations right? | Well, the timing of the equity is really -- obviously, we're not going to be doing equity while our stock is currently trading, but assuming that there is some momentum with the company in terms of stock price, we've modeled the equity, Mike, I think sort of throughout the year, right? So that's the equity side. On the... | intermediate | [
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253011839024d40ff51febc96a5737de | And on the acquisitions, funded with dispositions, I mean, are you thinking about the opportunity set there in terms of, sort of, relative to your cost of capital today? So kind of where your shares trade, how much is that a factor and thinking about the deals that you're going to do relative to sort of match funding w... | It's a great question and absolutely we are watching obviously, the cost of that equity as it relates to what we're buying and the yields that we're getting longer term. Obviously, also watching risk as it relates to what we're behind, given the overall retail climate. So when we're looking at acquiring and growing the... | direct | [
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d6107ed3f7373d5d75f9dfe78a7c11bf | Hey. So on that last topic, the push to deleverage this year, is this to prepare the balance sheet for densification and how much equity do you need for the Crossroads project? | It's preferred for densification. We know it isn't. We fully acknowledge our net debt to EBITDA is little bit elevated. So we're going to continue to try and drive that down. Financing on Phase 2 of Crossroads, we have pretty compelling interest rate on the credit line, but we'll always look to keep our balance sheet -... | intermediate | [
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29fc1e0c286524f119ebced5c1f3ed9d | Okay. And then you mentioned about the equity price being sensitive, the equity issuance being sensitive to the stock price, yet you still want to delever. If the equity is where it is, call it six months from now, would you guys look to potentially monetize the densification opportunities? | The answer is, yes, we would look at that as an alternative. | direct | [
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2ab8792caa07ac659914b80328a881ce | Okay. And then the last one, can you guys give an update on how you're looking at the tenant watchlist this year versus maybe last year? And then on the leasing, is there any regions that stand out for strong pricing power? | Sure. Obviously, we are -- keep a close eye on the names that are in the press in terms of retailers that are out there having issues. The good news is that we have very low exposure to those tenants. And then in terms of their overall portfolio, we watch it very closely looking for any weakness and trying to be proact... | direct | [
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cb8af69a4e590ab4c80b7c93eb1aaa09 | Couple of questions, I guess, first, for the acquisition you're looking at in Southern California that's about $40 million. What are the attributes to that center that are putting the cap rate close to 6 considering you said that the rents are below market. | Well, the grocers, number one and number two, in the respective market that we're buying in. So sales are very, very strong in terms of attributes along with one other [Phonetic] anchor tenant, which is one of the strongest what we would call value tenants in the country. Those are your anchor tenant, but the rest is r... | direct | [
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de1b446ae248abe038f776a1009e160d | Got it. Okay. And then on the entitlement side and the densification, besides the three that are kind of in process right now, is there a shadow pipeline of opportunities where we could see additional projects being titled, say, in 2021? | Yes. There are three more behind the -- what I would call the three or four that we've discussed. Those are moving through the process, but will take a bit longer because they're at the beginning stages of entitlements. We can probably start talking about those next year, but all three or four of those are really at th... | direct | [
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b22b84bb873e4ec845e7b6e089d5a6c1 | Hi. Good morning. Just back to the 2% to 3% same-store NOI growth forecast, it does reflect a slowdown from the 3.6% in '19 and you mentioned that there is 150 basis points of occupancy that you're proactively looking to recapture. How much of that slowdown or how much-- what's baked into the range in terms of disrupti... | Well, it's primarily from recapture. It's almost all of it from recapture, if I'm correct, Mike, in terms of the downtime and same-store. There was a number of components that are built into that as far as the guidance goes, which I don't have all the details here, but the property by property budgets, give us a certai... | direct | [
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d6fb10783794dad2737c68728b15f2ee | Well, so with regard to that so what kind of cushion I guess have you assumed for 2020 fallout or unexpected move-outs? And specifically, I know you have a bunch of 24 Hour Fitness is in the portfolio, what's the latest there? I realize they don't break into the top 10 tenant list, but how much exposure does this 24 Ho... | Hey, Todd. It's Mike. I'll let Rich and Stuart talk about 24 Fitness, but on the guidance side as far as assumptions for bad debt to be conservative, we're assuming 1% of total revenues in 2020. But you got to keep in mind our actual bad debt has always been below 1%. In fact, it was I think 0.7% in 2019, but we're alw... | direct | [
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817fc57dca52fd3626adbed4e8910fd3 | Okay. And just lastly, Mike, for the model the FAS 141, rental income, the decrease that's embedded in the guidance, I think you said $3 million year-over-year. That line was heavy in the first and second quarter of '19. I think as you recaptured some space there. In the 4Q run rate I guess would actually be low, headi... | In first quarter of '19, we did have the recapture of the Kmart lease. That was a big pop there. The fourth quarter is probably a better run rate. We're going to have another pop in Q1, which we can elaborate on the next call for tenants that we're expecting to have moved out by the end of March, which are large below ... | direct | [
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dd1236df45c63d7279132cc4495d5ea8 | What is ROICs read on the exposure to possible repeal of Prop 13 the 1978 amendment? | So, the way we look at it and obviously it's still a bit of time away in terms of looking at what might happen, but most of the assets that we've acquired has been over the last, let's call it seven or eight years. And usually, the assessor in California runs about two years behind in terms of reassessment. So most of ... | intermediate | [
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bf7de6842b214343ecbdcc3258ceed16 | Hey, guys. Just a quick follow-up on earlier questions related to what's embedded in the same-store guidance. On the Pier 1s that you guys have what's your -- what are you modeling for your same-store this year, or is there any more rent coming in or is it a slow burn? | Well, this is Rich, I mean, we only have three Pier 1s in the portfolio and they're all typically below market in terms of the rent. We don't have any word that they're officially closing at any of these locations. However, we believe, one in Seattle may be on that list. We've already been very proactive. Months ago, w... | intermediate | [
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44c20dcad1ef5da8d95ab20b3b2e3cfe | Where would you like to end the year from a leverage perspective? | I'd like to get my net debt to EBITDA down with a six handle on it. I'm clearly there. Our overall leverage is modest, if you get it down to total debt-to-market cap, let's say, in the low 30s, mid-30s, but net debt to EBITDA is the one metric that we obviously are very focused on and we'll continue to chip away at it. | direct | [
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bd13d302ee5bab4b7a78e4fd9a5ad1a9 | Jure, I wanted to see if you could delve a little bit deeper into the communications network segment. You had guided for revenues to be sequentially up, but obviously you had a quite a good quarter. So, maybe can you just talk about what you saw in the optical side as well as networking and wireless and how you're thin... | Yeah. As I mentioned, Ruplu, in my prepared statement, we have a diversified customer base in that segment. We are involved in all new systems and products. So, if I look at their optical side, that looks pretty good. And also, the part of the networking side IP routing that also looks good. And I mentioned also that o... | intermediate | [
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ef3450c50fa51492a7d0036df301b366 | Maybe for my second question, I want to ask you on the defense business, the SCI business. You're trying to unlock value and you've created this new structure where you're going to have a separate President for that business. In the long term, what's your thought or your view on that business? Is this something you wan... | Yeah, we -- if you just look at the Sanmina businesses today, especially now these -- as we go into these three focus groups and three strong managers to really grow this business for us, our goal is still be successful on this model and I think we're going to unlock a lot of value. Yes, we need economy to cooperate, b... | intermediate | [
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5408368ba17739df3b68d98e9946e2d0 | Maybe -- I also wanted to ask you on the industrial, medical, defense, automotive side, I mean, again, you had guided for sequential improvement, but I mean, that segment grew, I think, 19% sequentially. So you saw pretty strong growth. Was there anything that surprised you in that in that segment? I mean, I know there... | Well, first of all, with COVID-19, every day is a different day both for our customers and for us. I think we adopted and we created enough flexibility that we're able to to help our customer fill the orders as they needed. We really -- our management really did a terrific job last quarter helping our customers do that... | intermediate | [
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00b8a0f3d0fa7efc6a7f3a8dc7251d30 | The first is, on the results, it looks like the cloud was down year-over-year and I think you expected it to be kind of stable. Kind of what's going on there with the deferments of orders or deferments of deliveries or change in architectural systems or anything we can think about? Because your cloud has been quite str... | Jim, two good questions. So first, let me answer the one around cloud computing which for us includes enterprise computing. As I said on my prepared statement, Jim, I think we're down about 8%, 7.9% or something, approximately $20 million from last quarter. We had some push out with a couple of customers, which in this... | direct | [
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39fa43f4e742fd29e66e239ce0179616 | As we -- you talked about earlier a strong pipeline of new opportunities. Can you give us some color about where you guys are seeing new opportunities? Is that expansion with existing customers or is that new customers that are helping you? | With medical, I will say both. We got some really good customers that we opened up in last three years, four years, medical sometimes takes a little bit longer time. I see some -- with existing programs some solid demand. We also have a few customers that have a weak demand and what happened with COVID. But again, we h... | direct | [
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01ca724c96de56b7ddbd88c9b470a1e1 | And then, the strength that you guys called out in the 5G networks, is that predominantly from your historically large customers there or is that expanding out? Just can you give us any color about the type of applications and products and the number of customers that you're dealing with in that area? | Well, we have a -- just building out 5G networks here. We have multiple customers that are involved and -- but when it comes to few 5G radios and products of that, that's our existing customers. We're working on some newer customers on that. But overall, we expect that business to business to continue to grow. | intermediate | [
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25e8ad0e05b0ccaa79e29e76c15061da | Okay, great. And then my last question, again, it's two quarters in a row of extremely strong gross margins in a kind of a lack of visibility and challenging environment. I'm sure lots of changes intra-quarter with your customer base. Can you just remind us exactly how you've been able to do that and why that wouldn't ... | First of all, it's going to continue to be challenging because -- as I mentioned in my prepared statement, there's still a lot of uncertainties and it comes around the COVID things are changing. Again, I give a lot of credit to our people on the floor able to really put the systems in place where we -- these things hav... | intermediate | [
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3642ccde299559be1fcad7c85bcbf44f | Patrick, IMO 20 is -- 2020 is about six or seven months away here. What are you expecting now from a demand perspective? And are you prepared to scale the production? What's incremental margin on the sale of those sulfur additives? | Yes, Jon. Good question. We're just starting to see an uplift in sales in the IMO 2020 product. I think it's really started to take effect in the general markets that this is coming upon us very quick.
And it's hard to say what's going to look like, but those margins in that area are much higher than the fuel specialti... | intermediate | [
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56c2180ab3722b863cf0f09627c086ff | OK. Great. And maybe I missed it, but what's driving the strong margins in Fuel Additives this quarter? And can we extrapolate that going forward? | Some of it was product mix. Some of it was we're starting to see, like I said, the IMO 2020 product come through. But I would still stick with that 33% to 34% because you do get some variances upon quarter. But it was a nice quarter, and we'll continue to see how the markets mature in some of these areas that we're tal... | direct | [
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9f5f3401381bd5a5b6f876f45af31904 | OK. Great. And then, Ian, the operating loss in Octane, how should we model that going forward especially if we assume that the shipment coming later this year is going to be the last one? Does that fall off pretty quickly once you sunset that business? How do you roll that up? | Yes, Jon. Good question. In Q1, we've had zero sales and we've also slowed the manufacturing facility writedown to manage our inventory and working capital. Because of that, we've had to take some of those costs to the income statement rather than into inventory.
So this is very much a worst-case scenario of a flat bus... | direct | [
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10a755b0090fb013ed75197d9f8eadfc | OK. Great. And then, finally, just on the performance chemicals, just a little color on what's driving flat volumes in pricing in that segment. Do you expect that to change going forward? Is there a stronger competition or weaker end demand? Just a little more detail on what's going on in the end market will be appreci... | I think part of it is we had a really strong first quarter and we had a really strong fourth quarter of last year. I think it's just order pattern. We're not necessarily seeing a slowdown in the Americas. We did see a little slowdown in the apprehension in Europe.
But overall, we're still very confident with the number... | intermediate | [
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] | B |
86e5bdedc1ae8f1efef6a57c2ae34ecd | When you think about the volume growth in fuel specialties, you had a really good '18 and it looks like '19 is gaining even more momentum. Can you maybe walk through how much of that is new products, market growth? And then how do you think that growth kind of flows through in 2Q and the rest of the year? | I think it's a little bit of everything, Mike. I think we've had some customer growth, organic customer growth. We've also picked up some new business. I think it's probably just a volume as well going from one quarter to another.
And I think it's also, as we said, some new technologies that we brought to the market an... | intermediate | [
"direct",
"intermediate",
"fully_evasive"
] | B |
a62b5fdecfaf8118973581d9a6d38d99 | Got it. And then in oilfield services, clearly, that business is recovering. Where do you think profitability can continue to improve to as the year unfolds? | Yes. I mean, you saw that we increased our operating margins significantly and that was more about controlling costs. For now, the focus is now getting our gross margins up and introducing some of the new products that we have in the portfolio as well, which have higher margins. So you'll see that continued focus on th... | direct | [
"direct",
"intermediate",
"fully_evasive"
] | A |
6bcdcc2676a0d405a396d6ccfa90c812 | Got it. And then just one quick follow-up. Your balance sheet's still in pretty good shape. In terms of acquisitions or adding new technologies or businesses, how does the pipeline look? And is there opportunities for bigger deals out there? | It's interesting, Mike. In general, just the chemical sectors, in general, we've seen the market slow down quite significantly. In addition to that, you're seeing multiple start to back off, which is what we wanted. Obviously, we don't want to chase high-multiple businesses.
We do have things in the queue, from smaller... | direct | [
"direct",
"intermediate",
"fully_evasive"
] | A |
b07e52d0fef302b385d3fb99a8e464fb | I just jumped off another call so I apologize if some of these have been covered. But just on the octane additives, if there really is a final order coming up, do any of those costs move into the fuel specialties segment because of I know you're still supporting the aviation business there from that same plan. Is that ... | That's right, Chris, yes. fuel specialties carries the AvTel products. We don't expect any of the octane additives costs to transfer across. We might see a little bit of gross margin erosion in our AvTel products, but nothing that will be meaningful for the fuel specialties business. | direct | [
"direct",
"intermediate",
"fully_evasive"
] | A |
3574056a71db09b524fb4993861fb1a3 | And then for fuel specialties again, just how much -- was cold flow again a big impact in the first quarter because, again, it was very cold here in North America at point through 1Q. | No. We didn't see a real push in cold flow. I mean, it was pretty stagnant compared to where it was same time last year. So nothing that was really out of the ordinary on a single product growth.
It was really generally across the board. | direct | [
"direct",
"intermediate",
"fully_evasive"
] | A |
52d37e06f2a7c8c25ba7bca8d4f6aa1f | I wanted to start off on the split of sales by channel. I appreciate you laying it out in that detail. And it's clear you continue to see drive-thru, delivery and mobile ordering grow with counter sales down. And we listen to a lot of earnings calls in the last few weeks, it seems like more and more that delivery and m... | Sure. So I mean it varies a little bit by brand. I think we -- pre-COVID from an occasion perspective for Pollo, we had a very large lunch occasion dine-in mix and we believe that as consumers go back to their regular patterns of behavior, we believe that, ultimately that dine-in occasion is going to return and we're s... | intermediate | [
"direct",
"intermediate",
"fully_evasive"
] | B |
10604bc89a8b58c26fd051b2e396374b | On the Pollo restaurant-level margin and specifically on wages, first a clarification, I think your average hourly wage at Pollo was $9.60 the last update. Is that going to $10 per hour, which would be about a 4% increase by my math? Or is it the hourly wages across the board are going up by $1, which would be a larger... | Yes, good question. Good question for clarification. So we had some employees that were below $10 per hour. So we're moving those employees to $10. And then we're giving all employees another -- an extra $1 per hour.
And that extra $1 per hour is just for the time being to get us through this labor crunch.
No, no. Bu... | direct | [
"direct",
"intermediate",
"fully_evasive"
] | A |
c2ec8664325db5e4e49d2201387529e3 | And then there was a 3% price increase taken in April. Is that in addition to the 1.2% price that was already in place in the first quarter. So going forward, it's more like 4% or 4.2% price at Pollo? | That's correct.
And then a general level price increasing -- I was just going to add that the price increases that we just took, we believe will offset the cost of the changes that we've made to-date, even though some of those were short-term as Rich said. | direct | [
"direct",
"intermediate",
"fully_evasive"
] | A |
269ea2936f998dae5c622ce2b5e77367 | On commodities, did I hear correctly that you expect your commodity cost to be flat through the year because of locking in the prices across the board? | Correct. So for food, for key commodity categories we are locked in. We are now locked in, in some other categories that are less materials such as packaging. So we are seeing some pressure. I think like most other players in some of those areas, but on the commodity front, we expect stable costs. | direct | [
"direct",
"intermediate",
"fully_evasive"
] | A |
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