Humacyte, Inc. (HUMA) Q3 2026 Earnings Call Transcript

Operator: Good morning, ladies and gentlemen, and welcome to the Humacyte Third Quarter 26 Earnings Conference Call. Currently, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session and instructions will follow at that time. As a reminder, this conference call is being recorded. I will now turn the call over to Tom Johnson with LifeSci Advisors. Please go ahead.

Thomas Johnson: Thank you, operator. Before we proceed with the call, I would like to remind everyone that certain statements made during this call are forward looking statements under U. S. Federal securities laws. These statements are subject to risks and uncertainties that could cause actual results to differ materially from historical experience and present expectations. Additional information concerning factors that could cause actual results to differ from statements made on this call is contained in our periodic reports with the SEC. The forward-looking statements made during this call speak only as of the date hereof, and the company undertakes no obligation to update or revise the forward looking statements except as required by law. Information presented on this call is contained in the press release we issued this morning and in our Form 10 Q, which after filing may be accessed from the investor page of the Humacyte website. Joining me on today's call from Hemocyte are Dr. Laura Niklason, President and Chief Executive Officer Jim Mercadante, Chief Commercial Officer; and Dale A. Sander, Chief Financial Officer and Chief Corporate Development Officer. Dr. Niklason will provide a summary of the company's progress for the third quarter and recent weeks. Then we will provide an update of the commercial transformation and progress with the Symvess market launch. And Dale Sander will review this company's financial results for the quarter ended September 30, 26. I will now turn the call over to Dr. Niklason. Laura?

Laura E. Niklason: Thank you, Tom, and good morning, everyone. and I want to thank you for joining us for our third quarter financial results and business update call. I could not be more excited to share the progress that we are making at Humacyte. What we are doing at Humacyte is exceptionally challenging, and we have created a first in biologic solution that addresses some very significant and broad based health problems. We have built a team of incredibly talented scientists and other professionals, and an outstanding manufacturing facility. I wish that you all had the opportunity to come down and take a tour of our facility even representatives from much larger medical device and pharma organizations walk away in awe of what we have built. I believe that the momentum that we have demonstrated this quarter along with the upcoming filings and clinical trials, have set the stage for a very significant value creation story in the months and years ahead. it is taken a lot of work to get to this point, and my sincere hope is that we will all look back on today's call as an inflection point for the company. On today's call, after my overview, we will begin with Jim's review of our commercial progress for Symvess. As you know, Jim, was appointed as our chief commercial officer in May and he is already making a considerable and demonstrable impact on the execution of our commercial strategy. I will then review progress across our development programs before turning it over to Dale for a review of our financial results for the third quarter. We will then be happy to open up the call to take your questions. Let's begin. As we have mentioned previously, our focus for 2026 has been on advancing 3 main goals. Transforming and advancing our commercial programs for Symvess, preparation and submission of our supplemental biologics license application or sBLA with the FDA, for our ATEV product in the dialysis access indication. And commencement of a human study of our coronary tissue engineered vessels or CTEVs, in coronary artery bypass grafting. I am pleased to report that we have made substantial progress on all 3 of these goals. Commercial adoption of Symvess accelerated during the third quarter. With sales increasing 151% over the second quarter. To slightly over $1 million. Our supplemental biologics license application or sBLA is on track for submission later this month. And we are pleased to announce that we have initiated our first human Phase 2a clinical study of CTEV in coronary artery bypass grafting, or CABG, and we are now open and screening patients. I will now turn the call over to Jim for his review of our commercial results before I recap the progress on our pipeline programss.

Jim Mercadante: Thank you, Laura, and good morning, everyone. it is a pleasure to be speaking with all of you. As I mentioned on the last call, when I joined Humacyte, my immediate focus was to rebuild and reinvigorate our commercial effort for Symvess. I was captivated by the potential to capture meaningful market share in an area where patient outcomes can improve materially. At a baseline level, our Revitalize program was designed to drive adoption of the products by hospitals, expand utilization of Symvess, and establish a path to sustain growth for Symvess. To accomplish this, we completely remodeled the commercial team with a focus on ensuring our professionals had critical long term relationships in the vascular surgery space. Our team is already demonstrating the impact of deep industry relationships and the trust they have built across the market. We also refined our introductory pricing and incentive programs and approach to peer to peer professional education and our focus on hospital adoption. These initiatives were designed to ensure each element worked together to help create a scalable engine that converts interest in our first in class product into approvals, utilization, and ultimately sustained revenue growth. I am pleased to report that during our third quarter, the result of this approach is absolutely delivering immediate impact. As Laura mentioned, Symvess sales revenue for that period was $1 million Our revenue more than doubled from the second quarter and we achieved our internal goal that we set for the quarter. Hospital adoption also expanded significantly with the number of hospitals ordering Symvess increasing by 44% from 34 hospitals at the end of second quarter to 49 hospitals at the end of September 30th. For those of you that understand the challenges of becoming approved as a new provider to a hospital, you can appreciate how excited we are about these results. As momentum has continued into fourth quarter, with October sales now reaching $800,000. With the current levels of hospital adoptions and physician agreement, we are seeing an expect fourth quarter sales to at least double our Q3 results. By the end of the year, we anticipate at least 20 new hospitals to be able to order through our network. Our strategy is delivering results. Our commercial momentum is building. And we believe Symvess is now well positioned to continue accelerating adoption and driving meaningful, sustainable growth. Like Laura, I am incredibly excited about the outlook for our business. With that, I will turn it back to Laura. To review our pipeline.

Laura E. Niklason: Thank you, Jim. So I will start with ATEV in dialysis access. Following discussions with the FDA, our plan is to file a supplemental BLA for the ATEV in dialysis access later this month. This sBLA will be supported by results from 3 Phase 3 clinical studies. Publication of the V007 phase 3 results in The Lancet Digital Health was very recent in the last few months. And we also recently presented the results of our V012 Phase 3 study in a late breaking session at the American Society of Nephrology Kidney Week just a few weeks ago. These presentations have given the vascular surgery in nephrology communities an overview of the data that form the basis of our sBLA filing. The phase 3 results, on V012 were presented by Dr. Prabir Roy-Chaudhury of the University of North Carolina of Chapel Hill and also a former president of the ASN. In the V012 Phase 3 trial, women on dialysis treated with the ATEV achieved functional access and use for dialysis more than 3 months sooner and spent significantly more time free from dialysis catheters over the first year, than did women who received an AV fistula, which is the current standard of care for hemodialysis access. These results also support our belief that the ATEV could represent the first major advance in dialysis access in decades. Offering surgeons and patients an alternative option for patients whose risk factors for AV fistula maturation make AV fistula maturation more difficult. As many of you know, we appointed doctor Prabir Roy-Chaudhury and Doctor Robert Kossmann as advisers to Humacyte. These are leading nephrologists who will help us prepare for the planned commercialization of the ATEV in dialysis access. After it is approved by the FDA. They will also contribute to the development of health economic reimbursement and market access strategies. As well as provide important peer to peer scientific support as they already have, and medical education. Let me turn next to another meaningful opportunity for Humacyte. The CTEV in coronary artery bypass grafting or CABG. The FDA accepted our investigational new drug application for a first in human clinical study of the CTEV in CABG. And we initiated a Phase 2a study of the CTEV in CABG patients this month. Also, just this past weekend, 3 scientific presentations related to CTEV were made at the American Heart Association Scientific Sessions Medical Conference. Dr. John Alexander, Professor of Medicine and Cardiology at the Duke Clinical Research Institute, and Dr. Alan Kypson, a cardiothoracic surgeon from UNC Rex Hospital. Presented an overview of the Phase 2a clinical trial protocol for our study. And researchers from Humacyte also presented preclinical results supporting the progression of the CTEV into the first in human study based on extensive large animal results and work. No new off the shelf conduits have been introduced for study in CABG in The US in the past 40 years. And our preclinical results suggest that CTEV may be a promising off the shelf alternative to saphenous vein grafts. To support this study, we have already completed the first large scale manufacturing lot of our CTEV product in our commercial scale manufacturing facility. And with that, it is my pleasure to hand the call over to Dale now for a review of our third quarter financial results. Dale?

Dale A. Sander: Thank you, Laura. Commercial sales of Symvess increased to $1 million for the third quarter of 26. Compared to $400,000 in the second quarter of 26, and $700,000 in the third quarter of 25. Sequential quarter sales growth and growth compared to the prior year quarter resulted from the commercialization initiatives implemented during the first half of 26 that Jim described and an increase in the number of hospitals ordering Symvess during the most recent quarter. For the 9 months ended 09/30/2026, commercial sales of Symvess were $1.9 million, compared to $1 million for the 9 months ended 09/30/2025. Contract revenue was minimal during the third quarter, for 2026 and 2025 and for the 9 months ended 09/30/2026, due to the completion of a research project and was $600,000 for the 9 months ended 09/30/2025. Cost of goods sold was $1.4 million for the third quarter of 26 compared to $300,000 for the third quarter of 25. In the third quarter of 26, $600,000 of Cost of Goods Sold related to the cost of units recorded as sales revenuess during the period and $800,000 was primarily comprised of overhead related to unused production capacity. Cost of goods sold was $4.7 million for the 9 months ended 09/30/2026. Compared to $600,000 for the 9 months ended 09/30/2025 In the 9 months ended 09/30/2026, $1.2 million of Cost of Goods Sold related to the cost of units recorded as sales revenuess during the period, $2.3 million related to inventory reserves, and $1.2 million was primarily comprised of overhead related to unused production capacity. Research and development expenses were $14.1 million and $51.7 million for the 3 and 9 months ended 09/30/2026, respectively, compared to $17.3 million and $54.7 million for the same periods in 25. The decrease in research and development expenses during the third quarter of 26 and during the 9 months ended 09/30/2026. Compared to the prior year periods, was primarily due to a reduction in noncommercial manufacturing runs and the wind down of certain programs. Research and development expenses have declined sequentially each quarter in 2026, and the $14.1 million incurred in the third quarter of 26 was $4 million less than the $18.1 million incurred in the second quarter of 26. General and administrative expenses were $9 million and $25 million for the 3 and 9 months ended 09/30/2026, respectively. Compared to $7.6 million and $23.6 million for the same periods in 2025. The current year increase in general and administrative expenses was primarily related to $600,000 in net expense related to a reserve for settlement of shareholder litigation and legal costs related to the litigation. Other net income was $8 million and $500,000 for the 3 and 9 months ended 09/30/2026, respectively. Compared to other net income of $6.9 million and $61.3 million for the same periods in 2025. Other net income for all periods resulted primarily from the noncash program remeasurement of the contingent earn out liability and other derivative liabilities. Net loss was $15.5 million and $70 million for the 3 and 9 months ended 09/30/2026, respectively, compared to a net loss of $17.5 million and $16 million for the same periods in 2025. The decrease in net loss for the third quarter of 26 was primarily related to the decrease in research and development expenses. The increase in net loss for the 9 months ended 09/30/2026, was primarily due to the noncash remeasurement of the contingent earn out liability described earlier. We had cash, cash equivalents, and restricted cash of $64.9 million as of 09/30/2026. During the quarter, the cost reduction measures that we put in place earlier in the year certainly flowed through and our net cash used in operations has declined substantially. Total net cash used in operating activities was $15 million and $62.1 million for the 3 and 9 months ended 09/30/2026, respectively, compared to $23.9 million and $78.9 million for the same periods in 2025. Cash used in operations decreased in 2026 primarily due to lower inventory production costs and the cost reduction measures that were put in place earlier this year. With that, I will turn the call back to Laura.

Laura E. Niklason: Thank you, Dale. So we are very pleased with the progress that we have made this past quarter. And with our remodeled commercial team and our excellent progress in our pipeline programs. With our outstanding and dedicated team, we remain committed to delivering truly transformative regenerative medicine solutions that improve patient outcomes. And save limbs and saves lives. We are positioned for growth and value generation for the balance of 2026 and beyond. I want to thank you for your interest in Humacyte, And operator, we are now ready to take questions.

Operator: Thank you. We will now be conducting a question and answer session. If you would like to ask a question, please press star, 1 on your telephone keypad. A confirmation tone will indicate that your line is in the question queue. You may press star, 2 if you would like to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. 1 moment, please, while we poll for questions. Our first question comes from Ryan with U. S. Bancorp BTIG. Please go ahead.

Ryan Zimmerman: Good morning, and congrats on all the progress. it is exciting to see the momentum, Laura, Dale, and Jim. Maybe for Jim, just you know, to understand more about kind of what you changed, you know, how you think about the durability of adoption this quarter, particularly with all these new sites. You mentioned a little bit about, you know, incentive pricing. I think, to get hospitals on board. Maybe you could just give us some more color on some of these dynamics, Jim. I think that would be very helpful. Thank you.

Jim Mercadante: Sure. Happy to do so, and thanks for the question. You know, first and foremost, I think 1 of the biggest impact that we had, we were hiring the right, leadership team. And specifically, those that have those vascular surgery, experiences and relationships across The United States. That was 1 key element that we executed on all throughout Q2 that impacted and into Q3 that impacted Q3 and now impacting Q4. that is first. The second is we did redevelop and retool our marketing, our messaging and our training at the same time. Again, doing this all throughout Q2 and partially Q3. And what it relates to pricing? it is no question that sometimes you have to, when you are launching a particular health care system, and they wanna try out the product, And, of course, outcomes and patient care is of utmost, you want to give some type of introductory price before you get them going and get them started. So I think the combination of all that has allowed us to take off commercially. And you can see that not only in Q3, but you see that with the takeoff in Q4, as I said a little earlier. We expect to double from Q3 to Q4 continuing that trend. So we are very excited about the progress we made. The progress will continue. And I think there is no question in our minds we have got the right product now we have the right people and programs in place to get this off commercially. Hope that answers your question.

Ryan Zimmerman: Very helpful. And, Laura, just turning to you on the pipeline. You are, you know, a couple weeks away here of getting that supplemental BLA in. How are you feeling about, you know, dialysis access as an approved indication? Can you give us a sense for timing of when you expect you know, we should think about commercial activity beginning? And just any other, you know, thoughts around the build out of the dialysis access program from a commercial perspective? For taking the questions.

Laura E. Niklason: Yeah. Well, on the commercial part of that question, I might toss it back over to Jim. But in general, the sBLA is coming together very well. As I mentioned on the call, we have 3 Phase 3 trials, supporting this indication. Our target indication, not yet approved, of course, but our target indication will be in all women and in men who have certain risk factors for fistula nonmaturation. I can tell you that looking at our clinical trial data across phase 3 trials, our outcomes in women are remarkably consistent. And remarkably good. And this is some really strong data that we are continuing to push very hard. We also, as we have said before, we have filed an MAA application in Israel, and that is marching along. So that is under active review right now, and we are also looking at other opportunities in the Middle East. You know, I believe that the uptake in vascular injury is going to continue to grow as we are at different sites. As I have mentioned before, on previous calls, occasionally, when a surgeon is using our vessel for the first time, he does not wanna be using it at 2:00 in the morning when somebody's bleeding to death. that is not the first time he wants to try our vessel. So the pattern that we are seeing is that surgeons are using it in more cases in the daylight that are somewhat more planned. Getting some experience there, and then moving over and using it more in trauma. that is just sort of an organic progression that is naturally occurring in hospitals. So we are gonna continue to push that because everywhere that we seed everywhere that we seed in a hospital that takes care of trauma patients, that is also gonna be a hospital that once we are approved in dialysis is taking care of dialysis patients.

Ryan Zimmerman: Excellent. And then know, it is encouraging that I think in the press release earlier in the quarter, the team commented on physicians submitting real world SIMVEST patient case studies presentation. I was hoping to just get any flavor in terms of some case highlights, real world case highlights that you can share. And then also, will some of these, case studies that will be presented occur at Veth and will they include any off label utilization including in a really challenging AV fistula like redos, infected EPDF, EPDF E graft, etcetera. Multi tiered question, but thanks for taking the questions, and congrats again.

Laura E. Niklason: Jim, do you wanna take that, or you want me to take that?

Jim Mercadante: Sure. No. Laura, I am happy to take it. Yeah. So let me just. Let me start with that part of the question. So these will be an exciting time for us. I mean, it is the largest vascular surgery meeting in the world that takes place in New York City, and we have really geared up this year and changed a lot of things. And specifically marketing strategies for this year as we So we are real excited about it. Put that aside and say, yes, there will be multiple case presentations given by physicians We tend to not get into that because those are physician presentations. You can always find some of physicians comments, especially lately on LinkedIn or some other social media, we are certainly seeing more and more adoption of our product across the country. We have. We open up new accounts each month, and certain physicians have put out press releases already about their experience and their adoption of it. And certain ones are waiting to present at least to give their feedback and opinion. But we are getting lots of positive feedback. And really successful cases in the United States, and we are excited about that. Laura, you probably have a follow-up.

Laura E. Niklason: I am sure. Yeah. The other thing that I would mention is that you know, along with onboarding Jim in April, we also onboarded Todd E. Rasmussen, our chief surgical officer. And he is. He and his, medical science liaisons have just been outstanding. On the sort of the proactive education front. Really connecting with surgeons at individual new locations and really teaching them about the most effective way and the most compliant way to use CymVest in their patients. Having a surgeon on the Humacyte team who has done more implants than maybe any other surgeon in the U.S. of our vessel, has been just, an outstanding tool for us because it makes surgeons out in the field who have never used the product before, it makes them more comfortable. And, also, because they are better educated, their outcomes are better. And so it is a virtuous cycle.

Ryan Zimmerman: Thanks for that, and good luck down the home stretch of the supplemental BLA filing.

Operator: Our next question comes from Chris Pasquale with Barclays. Please go ahead.

Chris Pasquale: Thanks. You talked about refining your introductory pricing strategy. So you could give us some color on where your ASP came in for Q3, or if you want to talk about sort of the other way,, what the $1 million in revenue translated to from a volume perspective.

Jim Mercadante: Well, I mean, you know, we tend not to talk about particular pricing on this call because, you know, a lot of our hospital administrators are listening. But what I could tell you is our average price for Symvess are around our list price is about $17,000 a unit. But again, when we are starting a particular health care system out, there could be introductory pricing. There could be evaluation pricing. So a lot of things go into that. And sometimes, when you are doing that calculation, it kind of dilutes it. But I could tell you moving forward and as each quarter goes on, the ASP tends to get stronger and stronger with the adoption of the product. So I cannot give you very specific information, and there is a reason for that. But hopefully, that answers your question, gives you an idea of where we are and where we are headed.

Chris Pasquale: Okay. And then as we see revenue stepping up here, it should improve the ability to absorb some of the overhead costs that are flowing through COGS. So do you expect to have a positive gross margin in the fourth quarter given where the commercial adoption is trending? How should we think about that?

Dale A. Sander: Yeah. The biggest. This is Dale. Hey, Chris, the biggest impact on COGS in terms of unused production capacity is whether we are actually in production at a particular point in time. We had really great success with our production as we closed out 2025. I think at some point in time, we had close to 9 or 10 lots in a row that passed without failure, and because of that, we have been able to run limited production runs in 2026, which means that we have had this unused overhead flowing into Cost of Goods Sold, which likely will continue for the fourth quarter too. Yeah. Based on how sales are ramping, we have a very robust production schedule plan for 2027. And so as we move into 2027, you should not see the unused production capacity flowing. Continuing to flow into Cost of Goods Sold.

Chris Pasquale: Okay. Thank you.

Operator: Our next question comes from Henry Ware with H. C. Wainwright. Please go ahead.

Henry Ware: Hi. This is Henry on for RK. And, just going back to dialysis, as you are preparing for the potential launch, how much can you build on the existing hospital relationships and the experience established through trauma? And with the 2 new nephrology advisers, I guess, what additional work are you guys doing on reimbursement and education that could help with adoption. If approved. Thank you.

Jim Mercadante: Laura, you want me to take the first part?

Laura E. Niklason: Or both?

Jim Mercadante: Yep. And I will take the second.

Laura E. Niklason: You got it.

Jim Mercadante: So, great question. We believe that the adoption obviously continues throughout Q4 and 2027 of our current indication. And, yes, it will directly in a positive manner, impact our launch when we do get approval for dialysis. And the reason is because the same vascular surgeons that are using for the most part, 8 out of 10 times, the same vascular surgeons that are using our product today also do dialysis access. And so it transforms beautifully when a physician is already experienced with implanting our product. To be able to do that in dialysis, it is not seamless. but there is a real familiarity with it. And it allows us for a much quicker adoption cycle than it would just coming in fresh.

Laura E. Niklason: Yeah. And with respect to Doctors, Roy-Chaudhury and Kossmann, These are outstandingly experienced nephrologists, 1 from the private sector. Rob Kossmann is the former Chief Medical Officer for Fresenius. And he actually ran all of their dialysis centers in the U.S. for many years. Then Prabir Roy-Chaudhury is also very involved with the academic, leadership in nephrology and past President of the ASN. So both of these gentlemen have been advising us for probably about the last 6 months. And they have really helped us hone in on, some of the some of the things that are gonna be important both to Medicare, but also to value based care organizations that are functioning under the Kidney Care Choices model that is supported by CMS. So, in terms of in terms of the amount of risk that certain value based care organizations take on, Some of these organizations take on 100% of the risk of cost of total cost of care for their dialysis patients. And so these organizations are extremely focused on improving outcomes so that patients have fewer complications and fewer hospitalizations. And drive down total cost of care. But these organizations are also very focused on certain metrics like optimal start, which is a scenario whereby a patient can start newly on hemodialysis and avoid a catheter altogether. So there are. We are already partnering closely with leaders, chief medical officers, and CEOs of various value-based care organizations to understand what their pain points are and to really create a robust financial model that will help them understand how our vessel can both help their patients and get better outcomes but also help them meet some of their metrics and drive down total cost of care. Frankly, a lot of these interactions have been facilitated from the advice of Doctor Roy-Chaudhury and Doctor Kossmann. We are also speaking with them about CMS reimbursement and other topics. So they are not our only advisers in this area, but they have been profoundly helpful.

Henry Ware: Thank you. And then regarding the V012 study presented at ASN, I guess as follow-up continues, are you collecting any additional data? And do you plan to share any of that publicly?

Laura E. Niklason: Yeah. So we stopped enrolling the V012 study when we met our primary interim analysis endpoint So, we had targeted 150 patients total. We had enrolled 120 by the time we completed our interim analysis. So we have got 120 patients enrolled. We had pre specified with the FDA that we would follow all of those patients through year 2, and we are doing that. So the first year data has actually been written up, and it is being submitted to a major vascular surgery journal as we speak. We also. As I mentioned before, we have published the 1 year results in the V007 study, and we are looking at publishing additional long term results in the V007 study, which also compared our vessel to fistula as well in men and women. So I see a number of publications coming out even in advance of FDA approval. I see a number of publications coming out relevant to dialysis access. In phase 3 trials.

Henry Ware: Thank you. Thanks. that is helpful.

Operator: Our next question comes from Bruce Jackson with Stonex. Please go ahead.

Bruce Jackson: Hi, good morning and thanks for taking my questions. I apologize if I missed this, but what is the status of the bio vascular pancreas? And are there gonna be any public data points coming up here in the future?

Laura E. Niklason: So the biovascular pancreas is still certainly a pipeline project for Humacyte. We actually have a publication that is in press right now on some of our primate work that we have done showing long term islet survival. In an allogeneic primate model. I would say that right now, this quarter and next quarter, we are focused pretty tightly on manufacturing and the sales ramp. So we. We are continuing to work at a bench top level on the biovascular pancreas. But, you know, as a company, I think we are focused most of our energy on growing the commercial story making product and making sure that we do not stock out because Jim is selling so much. Do not wanna run out, so we are gonna make a lot more. And that is really the primary focus for us right now. The biovascular pancreas project is something that I think will put more resources into, probably next year when we have a little bit more daylight around cash flow. But that is where we are. So we are continuing we have a publication, and we are continuing benchtop work. As of right now.

Bruce Jackson: Okay. Great. Got it. Thank you.

Operator: We have reached the end of our question and answer session. I would now like to turn the floor back over to Laura E. Niklason for closing comments.

Laura E. Niklason: Yes. Thank you, operator. You know, this has been such a journey, and I am just so grateful to the employees at Humacyte and also our investors who have been with us on this long and sometimes arduous journey. I want to emphasize that I believe this is a turning point for Humacyte. The revamped commercial structure has already had an amazingly positive impact in an amazingly short period of time. I think this would not be true if we did not have a good product. That works and that physicians like and that saves limbs and saves lives. And I believe that is all true. And I. Our commercial execution now is much better, I think, than it was previously, and we are seeing the dividends of that. So, I always say I am excited on these calls, but I am really excited this quarter. And I think that next quarter and then 2027 are going to have a lot more growth. So stay tuned.

Operator: This concludes today's teleconference. You may disconnect your lines at this time. Thank you for your participation.