Joe Bartolacci - President and Chief Executive Officer Steve Nicola - Chief Financial Officer

Chris Moore - CJS Securities Liam Burke - Wunderlich Securities Scott Blumenthal - Emerald Advisors David Stratton - Great Lakes Review

Ladies and gentlemen, thank you for standing by and welcome to the Second Quarter Financial Results Conference Call. At this time, all participants are in a listen-mode. Later, we will conduct a question-and answer-session and instructions will be given at that time [Operator Instructions]. Also as a reminder, today's teleconference is being recorded. At this time, I would like to turn the conference over to your host Chief Financial Officer, Mr. Steve Nicola. Please go ahead sir.

Thank you, Tony. Good morning. I’m Steve Nicola, Chief Financial Officer of Matthews. Also on the call this morning is Joe Bartolacci, our Company’s President and CEO. Today’s conference call has been scheduled for one hour and will be available for replay later this morning. To access the replay, dial 1-320-365-3844, and enter the access code 421642. The replay will be available until 11:59 PM, May 12, 2017. We have posted on our Website, which is www.matw.com, the second quarter earnings release and financial information we will discuss this morning. The earnings release can be found on our home page for the quarterly financial data, on the top of our home page under the Investor tab, click on Investor News, then click on financial reports to access the information under the section Matthews International quarterly reports. Before beginning the discussion, at the advice of legal counsel, I have been advised to read the following disclaimer as it pertains to forward-looking statements. Any forward-looking statements in connection with this discussion are being made pursuant to the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements involve known and unknown risks and uncertainties that may cause the Company’s actual results in future periods to be materially different from management’s expectations. Although the Company believes that the expectations reflected in such forward-looking statements are reasonable, no assurance can be given that such expectations will prove correct. Factors that could cause the Company’s results to differ from those discussed today are set forth in the Company’s annual report on Form 10-K and other periodic filings with the SEC. To begin the conference I'll review the financial results for the quarter, Joe will then provide general comments on our operations. Following that, we will open the discussion for questions. For the quarter ended March 31, 2017 the Company reported earnings of $0.46 per share compared to $0.43 per share a year ago. On a non-GAAP adjusted basis, earnings per share for the fiscal 2017 second quarter were $0.84 compared to $0.75 a year ago representing an increase of 12%. The significant factors in the year over year improvement in earnings per share included the impact of higher sales of memorialization products including cemetery memorials, caskets and cremation equipment. Sales growth in our UK and Asia Pacific brand markets, continued synergy realization from the SGK and Aurora acquisitions and the benefits for ongoing productivity initiatives. For the six months ended March 31 2017 the Company reported earnings of $0.74 per share compared to $0.57 per share a year ago. On a non-GAAP adjusted basis year-to-date earnings per share at March 31, 2017 were $1.45 per share compared to $1.35 per share a year ago. The significant factors in the year-to-date improvement in earnings per share included an increase in sales of cemetery memorials and cremation equipment, higher sales in our UK and Asia Pacific brand markets continued synergy realization from the SGK and Aurora acquisitions, the benefits of ongoing productivity initiatives and with respect to GAAP earnings per share a reduction in acquisition integration costs. Year-to-date earnings also reflected a significant increase in stock compensation expense. As we noted last quarter, as several members of our management reached retirement eligible status, the accounting rules require accelerated expense recognition of awards versus an amortization over the stipulated vesting period. This change had an unfavorable impact of $0.07 on the fiscal 2017 first quarter compared to a year ago. Excluding this impact our year-to-date non-GAAP earnings per share increased 12.6%. Consolidated adjusted EBITDA for the quarter ended March 31 2017 was $58.3 million compared to $56.1 million a year ago, representing an increase of $2.2 million. Consolidated adjusted EBITDA for the six months ended March 31 2017, was $109 million compared to $103.1 million a year ago, representing an increase of $5.9 million. A reconciliation of non-GAAP earnings per share and adjusted EBITDA were provided in our press release yesterday which has been posted to our website. A significant portion of the non-GAAP adjustments continues to include costs and other charges in connection with the integrations of the acquisitions of SGK and Aurora, including our ERP integration and implementation. In addition, acquisition related costs included charges incurred related to our recent acquisitions including assets step up expense. Acquisitions completed during the fiscal 2017 second quarter including ANE Ongurt, JMBH, equator and BCG Group and our SGK Brand Solution segment and RAF Technology in our industrial technology segment. Consolidated sales for the quarter ended March 31 2017 were $380.9 million compared to $367.2 million a year ago, representing an increase of $13.7 million. The improvement reflected an increase in sales of memorialization products including cemetery memorials, caskets and cremation equipment, higher sales of marketing products for the industrial technology segment and the benefit of recent acquisitions. In addition SGK Brand Solution sales in the UK and Asia Pacific markets were higher for the recent quarter. Changes in foreign currency exchange rates had an unfavorable impact of $5.6 million on the Company's current quarter consolidated sales compared to a year ago. The Company's consolidated sales for the six months ended March 31 2017 were $729.9 million compared to $721.4 million a year ago. The growth in year-to-date consolidated sales results primarily from an increase in sales or cemetery memorial products, higher sales in the UK and Asia Pacific brand markets an increase in merchandising sales and the benefit of recent acquisitions. Changes in foreign currency exchange rates had an unfavorable impact of $10.8 million on the Company's current year-to-date consolidated sales compared to a year ago. Sales for the SGK Brand Solution segment were $190.1 million for the current quarter compared to $184.4 million for the same quarter a year ago, representing an increase of $5.7 million. The segment reported sales growth in its UK and Asia-Pacific markets and an increase in merchandising sales in the U.S. These increases were partially offset by lower brand sales in North America and Europe due to continued slow market conditions. Currency exchange rate changes had an unfavorable impact of $5.1 million on the segment sales for the quarter compared to a year ago. Sales for the SGK Brand Solution segment for the first six months of fiscal 2017, were $365.9 million compared to $362.7 million a year ago, representing an increase of $3.2 million. Currency exchange rate had an unfavorable impact of $9.9 million on the segment sales for the current six month period compared to a year ago. The SGK Brand Solution segment reported operating profit of $4.4 million for the current quarter, compared to $5.5 million for the same quarter a year ago. Charges related primarily to the acquisitions and acquisition integration activity were $6.9 million for the current quarter compared to $7.6 million last year. Unfavorable changes in product mix and currency rates were the primary factors in the year-over-year reduction in operating profit for the quarter. These changes were partially offset by the realization of acquisition synergies and other cost reductions. For the six months ended March 31, 2017 the SGK Brand Solution segment reported operating profit of $8.6 million compared to $8.3 million a year ago. Charges related primarily to the acquisitions including assets step up expense, and acquisition integration activity were $13.1 million for the current year compared to $14.9 million last year. Memorialization segment sales for the fiscal 2017 second quarter were $162.1 million compared to a $157.4 million for the same quarter a year ago. The segment reported higher sales volume of cemetery memorial products, caskets cremation equipment in the current quarter. For the six months ended March 31, 2017 Memorialization segment sales were $307.7 million, compared to $305 million a year ago. The segment reported higher sales of cemetery Memorialization products and cremation equipment which were partially offset by lower caskets sales reflecting an estimated decline in U.S. caskets a desk during the six month period. Operating profit for the Memorialization segment for the fiscal 2017 second quarter was $22.9 million, compared to $19.5 million for the same quarter a year ago. The increase reflected the impact of higher sales and the benefits of acquisition synergies and ongoing productivity initiatives. In addition charges primarily in connection with the Aurora acquisition integration and ERP integration and implementations were $2.6 million for the current quarter compared to $685,000 last year. Operating profit the Memorialization segment for the six months ended March 31, 2017 was $37.3 million, compared to $27.2 million a year ago. The increase reflected the impact of higher sales and the benefits of acquisition synergies and ongoing productivity initiatives. Charges primarily in connection with the Aurora acquisition, integration and ERP integration and implementation were $4.7 million for the current year compared to $7.9 million last year. The prior year also included the impact of inventory step up expense. The industrial technology segment reported sales of $28.7 million for the quarter ended March 31, 2017 compared to $25.4 million for the same quarter last year. The current quarter reflected higher sales of marketing products and the benefit of recent acquisitions offset partially by lower sales of fulfillment systems. For the six months ended March 31, 2017 the industrial technology segment reported sales of $56.3 million, compared to $53.7 million last year. The industrial technology segment reported an operating loss of $471,000 for the current quarter, compared to operating profit of $1.5 million for the same quarter last year. For the first six months of the current fiscal year, the segment recorded operating profit of 35,000 compared to $3.1 million last year. The benefit of higher sales for the current year were offset by the impact of an unfavorable change in product mix and higher product development cost. Product mix was impacted by the delay of a significant fulfillment project originally scheduled for the fiscal 2017 second quarter. In addition the segment incurred acquisition related charges of 142,000 and 444,000 respectively for the current quarter and six months periods. Consolidated adjusted EBITDA as a percent of sales was 15.3% for the fiscal 2017 and fiscal 2016 second quarter. Consolidated adjusted EBITDA as a percent of sales was 14.9% for the first six months of fiscal 2017, compared to 14.3% last year. The year-to-date adjusted EBITDA margin improvement primarily reflected the impact of acquisitions synergies and other cost reduction initiatives. A summary of operating results by segment, including non-GAAP adjustments for the quarter and six months periods are posted on our website for your reference. Gross margin for the quarter ended March 31, 2017 was 36.3% of sales compared to 37.5% a year ago, primarily reflecting the impact of acquisition assets step-up expense for the current quarter. Gross margin for the six months ended March 31, 2017 was relatively consistent at 36.4% of sales compared to 36.6% a year ago. Selling and administrative expense for the current quarter was 29.3% of sales compared to 30.3% for the same quarter last year. Year-to-date selling and administrative expense for fiscal 2017 was 30.1% of sales compared to 31.3% last year. The decline primarily resulted from synergy realization and a reduction in acquisition integration costs. Investment income for the fiscal 2017 second quarter was $780,000 compared to $235,000 a year ago. Investment income for the first six months of fiscal 2017 was $1.1 million compared to $936,000 a year ago. The year-over-year change represents investment performance on assets held in trust for certain of the Company’s benefit plans. Interest expense for the current quarter was $6.6 million compared to $6 million for the same quarter last year. Interest expense for the six months ended March 31, 2017 was $12.8 million compared to $11.9 million last year. The increase resulted primarily from higher average interest rates this year and additional borrowings as a result of the recent acquisitions. Other deductions net for the fiscal 2017 second quarter were $153,000 compared to $192,000 a year ago. For the six months ended March 31, 2017 other deductions net were $708,000 compared to $1.1 million a year ago. Other income and deductions generally include among other items, banking related fees and the impact of currency gains or losses on certain inter Company debt. The Company’s effective income tax rate for the six month ended March 31, 2017 was 28.9% of pretax income. This rate reflects certain favorable tax benefits and utilization of certain tax attributes specific to the current year. The effective tax rate was 30.5% for the fiscal year ended September 30, 2016. At March 31, 2017, the Company's consolidated cash was $43.6 million compared to $55.7 million at September 30, 2016. The decrease primarily resulted from cash used for the Company's recent acquisitions. Accounts receivable at the end of the current quarter approximated $303 million compared to $295 million at September 30, 2016. Consolidated inventories at March 31, 2017 were $175 million compared to $162 million at September 30, 2016. Long-term debt at the end of the current quarter, including the current portion approximated $947 million compared to $873 million at September 30, 2016. The increase primarily resulted from additional borrowings for the Company's recent acquisitions. Outstanding borrowings on the Company's domestic credit facility at March 31, 2017 were approximately $885 million. Total borrowing capacity on this facility was increased to $1.15 billion in fiscal 2016, $250 million of which was in the form of an amortizing term loan. The facility has a maturity date in April 2021. Additionally, as we previously disclosed, we received a claim in September 2014, seeking a drop on a letter of credit issued by the Company of £8.6 million with respect to a performance guarantee on a project for a customer in Saudi Arabia. We assessed the customers' claim to be without merit and accordingly initiated an action with the court. Pursuant to this action a court order was issued in January 2015 requiring that, on received by the customer the funds were to be remitted by the customer to the court pending resolution of the dispute between the parties. As a result, the Company made payment on the draw up to the financial institution for the letter of credit and the funds were ultimately received by the customer. The customer did not remit the funds to the court has ordered. On June 14, 2006, the court ruled completely in favor of Matthews, following a trial on the Merits. However, the customer has not yet honored this court order and remitted the funds. It is possible the resolution of this matter could have an unfavorable impact on results of operations. The Company had approximately 32.2 million shares outstanding at March 31, 2017. Year-to-date, the Company purchased 135,147 shares under its share repurchase program at a cost of $9.2 million. At March 31, 2017, approximately 1.9 million shares remained under the current share repurchase authorization. Depreciation and amortization expense for the current quarter was $17.1 million compared to $16.4 million a year ago. Year-to-date depreciation and amortization expense was $32.3 million for the current year compared to $32.2 million a year ago. Capital expenditures for the quarter ended March 31, 2017 were $8.2 million compared to $9.2 million a year ago. For the six months ended March 31, 2017 capital expenditures were $13.3 million compared to $23.9 million a year ago. Finally, the board last week declared a dividend of $0.17 per share on the Company’s common stock. The dividend is payable May 15, 2017, to stockholders of record May 1, 2017. This concludes the financial review, and Joe will now comment on our operations.

Thank you, Steve. Good morning. Our second quarter was another good quarter for our businesses. Strong performance from our memorialization segment where each of businesses delivered revenue and operating profit improvement, good synergy capture in peer home products and continued revenue improvement from SGK in the U.K and Asia and our merchandizing division help offset slowness in other parts of our business. During the quarter, we continue to deliver strong synergy capture and improved our cost structure in many of our businesses further positioning us to meet our expectation. Our automations business struggled to delivers expectations largely due to the deferral of a large project that we had anticipated with end of the quarter and the segment. But the other portion of the businesses contributed nicely to offset that challenge. Regarding our two acquisition we are approaching the end of our initiatives on SGK and we expect integration expense to be substantially complete in the next quarter or two. Aurora on the other hand is expected to continue to incur integration cost through early 2018. Both integrations continues to go well, on-track both in terms of integration cost and synergies and we expect the remaining synergies to be in the range of $15 million to $20 million. With regard to our brand business, we are in the process of implementing our final phase of the ERP solution, which continues to go well and is expected a little over the remaining piece of our synergy estimates. Our North American business has finally starting to see some ordering of new labeling requirement projects of packaging innovation has been wide and marketing dollars remains constrain by zero based budgeting focus in our clients, which has dampened our North American revenue. We expect this trend to challenge our traditional packaging business in the near-term as our clients look for ways to meet changing consumer demand, but should be mitigated by the labeling requirement going forward. More over we continue to expand our product and service offering by adding marketing communications, design adaptation and internet marketing solutions to the SGK portfolio, where you have seen growth in some of our markets. Also during the quarter, we acquired several small businesses, each of which should have a positive upside to our business. Although each is small relative to our overall business we expect these acquisitions to be very positive to our overall strategies in the longer term. As we look at our businesses we continue to see strong cash flow performance with depreciation and amortization exceeding our capital expenditures by almost $20 million on a year-to-date basis. Similarly our EBITDA margins in each of our segments on a pre-corporate allocation basis continue to be in the mid to high teens or better, showing the strength of our operating performance throughout the businesses. We believe we see a path to continue to improve those margins and advance our business as our ERP implementation is completed. As mentioned above, our industrial technologies business had a difficult quarter but saw strong equipment and ink sales reflecting the innovation and product developments to the past of this business. The overall performance of the group as discussed above was challenged by a $7.5 million project in our automation division, which is deferred and $1.6 million of R&D spending for a new product which we can and need to have great promise. The new development remains on-track both in terms of timing and total investment which we expect to be around $7 million this year. We expect to have the new product in the market by 2018 and should see, begin to see the benefits of that in early 2018 and 2019. Looking at the balance of 2017, we remain confident of our ability to achieve our goals to deliver our non-GAAP EPS in line with our expectations. We remain cautious however given the uncertainty around death rate which have been sharply of late and continues sluggishly in North America and European brand market. Nonetheless we remain pleased with the direction of all of our businesses as the investment, and the investments that we have made. With that, let's open it up to questions. A - Steve Nicola: For those of you who will be asking questions we request that you limit them to one question and a follow up question until all those who wish to participate in the Q&A session have had an opportunity to do so. Tony.

Thank you very much, [Operator Instructions] Our first question will come from Dan Moore with CJS, please go ahead.

Hey good morning, it's actually Chris Moore for Dan. The memorialization revenue was up across the board, can you give us a sense of the relative organic growth rates, for memorials versus caskets.

Sure, we also have the environmental businesses, those are cremation equipment principally and that had a very strong quarter as well. So we are seeing better backlog ordering in that business and continue to see strength in both North America and elsewhere in the world. When it comes to the memorialization business on the cemetery product side, we had good revenue on that business largely driven by some COP which is certified ownership program on pre-need basis on some of our larger accounts. As well on the funeral home side, you heard me mention some choppiness in the death rate. We saw a very, very strong month of March and slower months ended January and February. So there is still some choppiness in there, I would tell you that the relative growth in the two businesses was about the same. Some price and some organic, but at the end of the day we were real pleased with the direction on that business.

Got you, and just one more before I get back. How much of an impact did rising copper prices have on margins in memorialization?

For this quarter just because of our purchasing patterns and the fact that we were bought out to some degree really didn't have a significant impact this quarter.

Terrific, I'll jump back in line. Thanks guys.

Thank you, the next question will come from Liam Burke with Wunderlich, please go ahead.

Yes good morning Joe, good morning Steve.

Hi Liam.

Morning Liam.

Joe when you are looking at expense -- synergy expense realization on the SGK side of the business, I know you have an objective for 2017, looking at the first half of the year, how much has been realized or were you looking at something that's more backend loaded.

For the year alone we probably have realized on a year over year basis somewhere around $5 million in the first half of the year relative to the prior year another $5 million or so coming out of the balance of the year, on a year-over-year basis. We don't have a lot left in that tank as it relates to synergies to be driven from SGK. We are pretty much in line with what we had expected coming up, I would say by the end of 2018 we will have realized everything.

Okay, great and just quickly staying with SGK, there has been an articles discussing the CPGs revenue are down about 3.5% first quarter, I mean obviously when you are managing the business you have got the Fair Labeling Marketing Act coming to help partially offset that. But do you have to manage business any different than you first anticipated?

Oh absolutely, there was a recent article in the paper that talked about the impact of certain CPGs I mean for better or worse, we do work with all of those with our clients. And we are seeing revenue challenge in each of them, nothing that we have done just less marketing dollars and innovation being spent. As a result of that what has traditionally been a more reprographic service function, you saw us pull couple of small acquisition one that which we are very, very positive about that would take us further into the adaptive art meaning going upstream not to the initial creation to the package as much, but further into the adapt creation and more importantly going into the private label sectors especially as it relates to retailers specifically. So we are managing to move the business in other directions all in the digital content management side. But at the end of the day, we are going to have to expand our product and services to continue to grow that business.

Great. Thank you Joe.

[Operator Instructions] Next in queue is Scott Blumenthal with Emerald Advisors. Please go ahead.

Good morning Joe, good morning Steve. Joe it looks like the next couple of quarters are setting up to be pretty nice for the business overall. Since 60% of the business is now kind of project based SGK and your industrial technologies business. Maybe you can give us some insight into the outlook with for each one of those? Particularly on the SGK side as it refers to what you talked about with the Food Labeling Act coming through.

There I can give you a perspective one of our recent acquisitions a little Company by the name of Equator which has been great add is a business who does principally work through private label for retailers around the world. Names that you would be recognizing is walk down the street very clearly here and in Europe. All the services that they perform for those retailers who require FDA labeling in North America, so as it relate to that business sometime over the next 18 months we expect that business to do substantially better than it already has prior of the acquisition. I would tell you FDA labeling requirements right now are expected to be implement about the end of July of 2018, unless we see some deferrals on that there is a lot of work yet to come. We probably do about 15% to 20% of our business at least, in the food business in North America. So we would expect to see volumes start to grow as we go forward in the next 18 months or so. A couple of that we are seeing less new packaging innovation in general as those CPGs start looking for ways to address the change in consumer demand, reformulating product, repackaging product will be something that I think we will come back to this business overtime. But as we go through this turbulent time of addressing consumer demand we are going to see a little bit challenges on the marketing side.

And with regard to industrial technology, maybe some inside into what your outlook is there, obviously you mentioned you had the fulfillment project that got pushed out a little bit. Should we expect some of that in the current quarter of Q3, and maybe the outlook for that business maybe you can at least give us some comparison to maybe where we were last year with regard to project pipeline and those type of things?

We are real comfortable with the space in which we operate of the automation side, it’s the fulfillment side of the business where we had the challenge from the revenue standpoint and really focuses on e-commerce which all of us would agree is where we need to be focusing on as we move into that part of the business. Unfortunately, those projects are bigger and just case $7.5 million project on a business that might do $30 million to $40 million worth of revenue and in annual basis will be impact it in any given quarter. Our backlog today would tell us that that particular project is not going to hit until later part of the fourth maybe into the first quarter of 2018 they pushed it out, but nevertheless we continue to sell. I would tell you relative to prior year we are tight, but we expect that team and we will continue to move forward, a couple of nice little additions to the business will continue to grow with the offerings. So we are comfortable that we are in the right space and that will meet our year pretty close to it next year in that business.

Okay, super. Thank you. I'll get back into queue.

Thank you. [Operator Instructions] And a follow up from Scott Blumenthal. Please go ahead.

Joe or Steve are you feeling any impacts at this point rising commodity cost particularly steel and the cascade business or maybe your industrial technologies business. And then maybe some talk about some discussion on what is going on in the bronze side of the business too.

So we are feeling the impact particularly on the steel side. As you might expect as we have grown our funeral home products business, we sell a lot more steel than we do bronze, and steel has grown significantly in its grown to our P&L at this point in time. So the results you are seeing are being impacted by that, we have been successful in both reducing our cost and trying pass through those cost through our customers and got a little of extra volume as well. That's a positive note. On the memorialization side, we have mentioned in the past that we were going after and recovering some of the past customers we had lost in cemetery product side and we are seeing the benefit of that, we are seeing a more aggressive stance from some of our larger accounts as they focus more on pre-need sales. Those pre-need sales ultimately end up in early order of markers for us. And frankly our stone business, as we told you in the past albeit small at this point in time has significantly improved year-over-year on the year-to-date basis and we think that continues to be an opportunity for us to grow. We don’t call that out separately, part of cemetery products, but we are seeing good, good performance in all of those segment and environmental as well.

I know that years ago when Matthews was the little of bit of a different business, we started to experience some price sensitivity particularly as related to bronze memorials, are you seeing your customer as price sensitive these days or is some of that elevating and may be getting that business back to the type of growth rates that we had seen may be a decade ago.

So what we are seeing Scott, a decade ago when I took over the seat where copper was about £0.75 to £0.80 today almost $3.1, $2.83. What you saw in the early part of that decade was rapid increases in copper prices, we are not seeing that kind of rapid increase, and therefore we are not having to pass that kind of pricing through to try to recover. Secondly, I would tell you that business has done a great job of becoming far more efficient in their delivery of product and servicing. We are having to respond in different way that we did in the past and it’s a different business today that it was in the past. Regarding growth it's a different world than 10 years ago, cremation rates are substantially higher than they were back then, I would tell you that we continue to hold firm on our customer base and we will see whether or not our response which is to add the stone part of the business is able to offset any kind of fluctuation either way. So far that business has been a nice add for us despite some early challenges.

Okay, great. Congratulation on a very nice quarter. Thank you.

Thank you.

Thank you. [Operator Instructions] And next in queue is David Stratton with Great Lakes Review. Please go ahead.

Good morning and thank you for taking the question. I just wanted to kind of piggy back on Scott's question and when we look at price increases in pass through, what is your lag time approximately is that something that can be realized immediately or does it take a while for that to kind peculate to the system.

We generally raise our prices , unlike in the past, we have learned our lesson by alienating a few customers early on, we go out with price increases once a year, generally our round beginning of either the fiscal or the calendar year. So what you are seeing right now is the impact of the commodity increases and the benefit of the price increases that we made at the early part of the year.

Okay and then actually duck tails into my follow up and what does the comparative landscape look like in regard to price increases, are you seeing everybody in the industry trying to make those moves upward or is anybody holding back trying to gain share.

We are pretty much all on the same platform at this point in time there, the markets have gotten a little tighter in terms of suppliers, there is plenty of capacity in the marketplace, but price competition is always going to be a factor, but I would tell it's not as aggressive as it might have been 10 years ago.

Alright. Thank you.

Thank you. At this time, I'll turn the conference back over to our presenters for any closing comments.

Alright Tony, thank you. Well we would like to thank everyone for participating in our call this morning. And we look forward to our third quarter earnings release and conference call in July. Thank you and have a great day.

Thank you ladies and gentlemen; this conference will be available for replay after 11:00 AM Eastern time today running through May 12 at mid night. You may access the AT&T Executive Playback Service at any time by dialing 320-365-3844 and using the access of 421-642. Once again that phone number is 320-365-3844 using the access code of 421-642. That does conclude your conference call for today. We do thank you for your participation and choosing the AT&T Executive Teleconference. You may now disconnect.