Post by
Jimmy713 on Nov 11, 2021 8:27am
Q3 call transcript
In case you missed the call
Operator
Good morning and welcome to American Hotel Income Properties REIT LP’s Third Quarter Results Conference Call. At this time, all participants are in a listen-only mode. [Operator Instructions]
I will now turn the call over to Kelly Iwata, Director of Finance. You may begin your call.
Kelly Iwata
Thank you, Operator. Good morning, everyone, and thank you for joining us for our third quarter 2021 results conference call. Discussing AHIP’s performance today are Jonathan Korol, Chief Executive Officer; Bruce Pittet, Chief Operating Officer; and Travis Beatty, Chief Financial Officer.
The following discussion will include forward-looking statements as required by securities regulators in Canada. Comments that are not a statement of fact, including projections of future earnings, revenue, income, and FFO are considered forward-looking, and involve risks and uncertainties. The risks and uncertainties that could cause our actual financial and operating results to differ significantly from our forward-looking statements are detailed in our MD&A for the three and nine months ended September 30, 2021, our other Canadian securities filings available on SEDAR, and on our Web site at ahipreit.com.
AHIP does not undertake to update or revise any forward-looking statements to reflect new events or circumstances, except as required by law. Listeners are urged to review the full discussion of risk factors on AHIP’s annual information form dated March 15, 2021, which has been filed on SEDAR at www.sedar.com. Our third quarter results were made available yesterday afternoon. We encourage you to review our earnings release, MD&A and financial statements, which are available on our Web site as well as on SEDAR.
On this call, we will discuss certain non-IFRS financial measures, including NOI, hotel EBITDA, FFO, and AFFO. For the definition of these non-IFRS financial measures, the most directly comparable IFRS financial measure and a reconciliation between the two, please refer to our MD&A. References to prior year operating results are comparisons of AHIP’s current portfolio of 78 properties’ results in those periods versus today. All figures discussed on today's call are in U.S. dollars, unless otherwise indicated.
I'd like to remind everyone that this call is being recorded today, November 10, 2021, and a replay of this call will be available on our Web site. Jonathan will begin today's call with an overview of operational and financial highlights, followed by Bruce, who will provide an update on hotel operations. And lastly, Travis will highlight key financial results.
I'll now turn the call over to Jonathan Korol, Chief Executive Officer.
Jonathan Korol
Thank you, Kelly, and thank you, everyone for joining us today for our third quarter financial results conference call. For the third consecutive quarter, we're reporting rising top and bottom line results, accompanied by improvements to our balance sheet and liquidity position, this, despite an ever-changing hotel operating environment that presents unique challenges for our corporate team and hotel associates. In Q3, these challenges included the rise and fall of daily COVID case counts driven by the Delta variant. While national statistics painted a picture of declining air passenger counts and delayed return to work schedules, AHIP's portfolio of secondary market premium-branded select service hotels continue to narrow the gap to pre-COVID-19 demand levels.
Once again, Q3 cash flows improved versus the prior quarter on the back of rate-drive RevPAR gains, as well as operating margins that remain above pre-COVID levels. While we wait for broad-based demand from the business traveler, our premium-branded affiliated properties are drawing significant leisure demand. In the absence of complete certainty about when the majority of companies will send their employees back on the road or even when they'll return to the office, we're confident that the current demand environment will continue to propel the cash flow recovery in our business that has been underway since the beginning of the year.
The sustainability of operating margins remains a major focus for our team. Our margins have been helped by relaxed brand standards and operational efficiencies unlocked by our hotel manager working together with our asset management team. Management regularly discusses service standards with our brand partners, and expects that the level of complimentary food and beverage offerings as well as housekeeping frequency will remain below 2019 levels. We believe that there are many opportunities to further enhance our operating results beyond 2019 baseline levels.
First of all, and as mentioned earlier, the eventual sustained return of business travel will provide further demand compression and rate gains, as well as gains to the limited food and beverage offerings within our portfolio. Secondly, our five Embassy Suites properties, or 15% of our total key count, still lagged the rest of the portfolio recovery. We are seeing signs of this business coming back. Thirdly, the 12 assets that were purchased in late-2019 have benefited from our asset management oversight and dedicated revenue management, and should exceed 2019 results. In 2019, AHIP also renovated several properties. The benefits of these investment dollars did not have enough time to surface prior to the outbreak of the pandemic.
Taken together, these items paint an encouraging picture for the coming business cycle. Given the conviction around the sustainability of the recovery in our operations, we're pleased to announce the reinstatement of our monthly distribution, effective March, 2022. Distributions will recommence at an annual rate of $0.18 per common unit. In addition, we will be paying our deferred March 2020 distribution with payment to be made on December 31, 2021. March 2022 will mark two years since the suspension of our distribution, and we believe that we are one of the first North American hotel REITs to reinstate regular distributions.
We'd also like to announce that we will be deploying $30 million towards capital improvements to our properties in 2022. This is an effort to enhance the quality of our existing properties, and ensure that they capture returns on investment that we believe are available beyond those associated with organic post-COVID improvements to property cash flows.
I'll now turn the call over to Bruce, to discuss third quarter hotel operations. Travis will then highlight key third quarter financial metrics. Bruce?
Bruce Pittet
Thank you, Jonathan, and good morning, everyone. We were pleased to see the continued rebound, resilience, and growth of the AHIP portfolio in Q3. Top line was driven by strong ADR growth, which recovered to 2019 levels. This strong rate growth, coupled with continued focus on expenses and ongoing relaxed brand standards delivered strong portfolio margins and bottom line performance in the quarter. Despite top line revenue being down $12.3 million to 2019, NOI only declined by $2.4 million. The portfolio has seen sequential quarterly RevPAR growth since the beginning of 2021, with RevPAR growing 43% since Q1 of this year. Q3 2021 RevPAR is at 87% of the same period in 2019.
Total occupancy for our 78 hotels in the third quarter averaged 68.8%. On a monthly basis through the quarter, July occupancy was 73.1%; August, 67.5%; and September finished at 65.7%. From a seasonality perspective, our portfolio typically sees a decline in occupancy from July into August and September, as the summer vacation season draws to a close and schools go back in session. We experienced occupancy declines as anticipated, however the decline appear to be somewhat amplified due to the surge in COVID cases related to the Delta variant in the United States around the same time period. Although difficult to determine precisely, we believe the COVID spike impacted top line revenues in the range of $2 million this quarter, after comparing to prior Q3 seasonal occupancy declines.
Leisure demand continues to support strong weekend occupancies, which range between 78% and 84% in the quarter, while weekday occupancy was in the mid-60% to low-70% range. When we look at the three distinct segments of the AHIP portfolio, occupancy for the quarter was led by our 24 extended stay properties at 78.9%. The 49 select service hotel occupancy was 66.5%, and our five Embassy hotels had an occupancy of 57.8%. In Q3, average daily rate increased from Q2 by 7.7%, from $109.31 to $118.49. Specifically by month, ADR for the quarter was $120.34 in July, $118.20 in August, and $116.68 in September, with an aggregate ADR achievement for the quarter at 2019 levels.
Weekends continue to outpace midweek occupancy as a result of strong leisure segment demand. Friday and Saturday nights continue to be peak demand nights, with RevPAR achieving an approximate 20% premium over midweek room nights in Q3. As we move beyond Q3, October preliminary results have portfolio occupancy at 70.2%, ADR at $117.88, and RevPAR at $82.70. As a reminder, Q4 is a seasonally weaker quarter, and we anticipate seeing typical occupancy declines through Q4, as demand generally declines from U.S. Thanksgiving through New Year's. The leisure segment continues to be the dominant demand driver across our portfolio.
Corporate segment performance continues to significantly lag leisure demand. There had been some belief that after Labor Day there would be a significant return to office for many medium to large size corporations. With the spike in COVID cases in August and September, most larger corporations, which tend to have stricter travel policies, delayed their return to office plans until Q1, 2022. Although we are seeing some improvement in corporate demand, we believe the meaningful return of corporate travel will be tied to companies accomplishing their return to office plans.
Overall, we have seen business and occupancy recovery being quite balanced across our 78 hotels and 22 states. Geographically, we have five states report occupancy over 80% in the quarter. New Jersey, where AHIP has six hotels, ran 86.4% occupancies. Other states with occupancy over above 80% included New York, Michigan, Kansas, and Illinois. On the other end of the spectrum, Oklahoma occupancies continue to lag with Q3 occupancy at 47.9%, approximately 21 points below the portfolio average and down 29.9% to 2019 levels. Although, oil and gas prices have risen significantly over the last few months, we have seen no new room night demand from the oil and gas industry in Oklahoma. As our portfolio performance continues to improve, we are starting to see more hotels reach or exceed 2019 revenue metric levels. From an occupancy perspective although aggregate occupancy for Q3 was 13.2% below 2019, 15 hotels or 19% of our portfolio had occupancy above 2019 levels.
As mentioned previously, ADR has been the real catalyst in RevPAR growth. Overall Q3 ADR was flat to 2019 levels. However, 47 hotels are 60% of the portfolio recorded ADR this quarter at or above 2019 levels. Three states, Illinois at 16%, Iowa at 14.1%, and New Jersey at 1% reported RevPAR performance exceeding 2019 levels for the quarter. And notably six states had less than a 5% decline in RevPAR to 2019 levels, Florida, Georgia, Kansas, North Dakota, New York and Tennessee.
In Q3, our hotel manager continued strict cost management initiatives, which coupled with strengthening ADR, have continued to yield strong margins across the portfolio. In Q3, NOI margins were 38.6%, compared to 41.5% in Q2, and 32.1% in Q1 of this year. When compared to Q3 2019 NOI, margin has improved by 4.7 points from 33.9%. In Q3, we had a non-recurring linen write down of $1 million. This write down impacted NOI margins by 1.5 points in the quarter.
Similar to the first-half of 2021, several factors have contributed to the margin growth from 2019. Improving average daily rates, relaxed brand standards and ongoing cost containment initiatives. The greatest challenge to operating our hotels today is our hotel manager's ability to recruit and retain staff in the hotels. Currently, the portfolio is operating at 62% of 2019 in-house staffing levels. Staffing levels are being augmented with third-party labor where possible, management support of frontline positions and we're also seeing overtime costs increase as well.
Rooms labor CPOR in Q3 was $14.35, compared to Q2 of $11.78. In Q3 2019, room's labor was $16.13 as a comparative. Our hotels have seen increased supply chain disruptions in Q3. These disruptions include delivery delays, incomplete or reduce shipment sizes, product category substitutions, as well as issues around general availability of operating supplies and FF&E replacements.
Our manager continues to focus on this issue and support properties by sourcing alternative products and bulk purchases where possible. Our hotels have continued to operate with relaxed brand standards surrounding complementary services and housekeeping through Q3. Although, there have been some changes in service levels since the end of the prior quarter. Complementary services breakfast in particular have seen cost increases as a more complete hot breakfast offering has been restored, although streamlined to 2019 breakfast standards. As a complementary services comparative in the first-half of 2021, our comp services costs inclusive of labor was in the $2.17 CPOR range. In Q3 comp service CPOR was $3.26 and compared to 2019, when our comp services cost was at $4.98 CPOR.
From a housekeeping perspective, service levels have shifted to housekeeping by request and more of a light touch housekeeping program with properties continuing to see cost benefits with this service level compared to pre-pandemic costs. There continued to be many costs and service variables impacting our hotels today and it's too early in the recovery to provide specific margin guidance. As we've been saying for some time now, we do anticipate that some of the savings that we're currently seeing will become permanent providing for a leaner and more efficient operating model.
Through the first three quarters of 2021, our capital spend was focused on requests related to life safety and asset preservation. Year-to-date we have committed to $5 million in capital repairs and improvements with $2.2 million of that being committed in Q3. We have not undertaken any capital renovation projects to date. However, we are starting two small PIP projects in Amarillo, in Q4 that had been suspended at the onset of the pandemic. As the financial recovery of our business takes hold, we have been in discussions with our brand partners on our 2022 PIP program. Assuming stable or improving financial results, we are anticipating getting back to a renovation program similar in cost and scale to pre-pandemic levels.
And with that update on our hotel operations, I'll now turn the call over to Travis to highlight key financial and capital metrics for the quarter. Travis?
Travis Beatty
Thank you, Bruce. Good morning, everyone. We're pleased with the ongoing improvements and financial results. We have made meaningful improvements this year in our capital structure and liquidity that positions us for the ongoing recovery in the hospitality sector. In early 2021, the preferred equity issuance and amendments to our credit facility resulted in improvements to our liquidity position. The ongoing suspension of the distribution reduced capital expenditures and positive operating cash flow have all contributed to an increase in our liquidity. Cash flows from continuing operations was $9.6 million for the third quarter compared to $0.6 million for the same period last year.
At the end of the quarter, AHIP had $43.6 million in available liquidity comprised of unrestricted cash of $14.8 million and $28.8 million available to draw on our revolving credit facility. This is an improvement from $3.4 million -- of $3.4 million from the second quarter. In addition, we have $36.6 million in restricted cash. This amount is higher than normal due to reduced CapEx spending over the last 18 months. The biggest components are FF&E of $18.6 million [indiscernible] of nearly $8 million and a PIP reserve of nearly $7 million. We are well-positioned to fund FF&E programs on a large portion of our PIP program and we'll work to draw down this balance over 2022 and 2023.
Reported funds from operations, or FFO, were $26.4 million, or $0.32 per diluted unit prior to adjustments for two non-recurring items, other income and inventory loss. Recurring FFO was $12.8 million or $0.16 per unit adjusting for these two one-time items. Both FFO amounts with or without adjustments were the highest total and per unit FFO since Q3 of 2019. For the three months ended September 30, 2021 reported revenues increased to $68.4 million as compared to $46.3 million for the same period last year. Reported net income improved to $15.7 million compared to a loss of $12 million for the same quarter last year. The improvement is attributable to the other income and improved operating results.
In the last two quarters, we generated the EBITDA of $44 million and we expect EBITDA to exceed required outflows for principal and interest payments and capital in the fourth quarter. AHIP's portfolio has demonstrated as resilient and well positioned to address periods of potential future COVID demand disruption should there -- should they arise. Our hotels continue to achieve strong financial results in a challenging operating environment. With these improved results, AHIP is pleased to announce that its board of directors has approved the payment of the March 20 distribution with such payment to be made in December 31, 2021; and secondly, the adoption of a distribution policy providing for the payment of regular monthly distributions commencing in March 2022 at an annual rate of US$0.18 per common unit or a monthly rate of US$0.15 per unit in. The first regular monthly distribution is currently expected to be declared in mid-February with a record data at the end of February to be paid in March of 2022.
The declaration and payment of each distribution under this new policy remains subject to board approval. Debt-to-gross book value in the third quarter was 54%, compared to 55.4% in the second quarter, and 58% at the end of 2020. The decline is primarily due to a government guaranteed loan forgiveness and CMBS loan repayments during the quarter.
Further improvements to leverage are expected over time through a combination of improved operating results and sustainable distribution and selective equity issuance in support of growth transactions. In 2020, we were able to obtain relief on all 20 of our CMBS loans. The relief included a deferral for funding of FF&E reserves for six months, repayment of this deferral over 12 months and covenant waivers, $9.3 million out of $10 million of these deferrals have now been repaid, and most of the remaining portions will be repaid in the next 12 months.
AHIP has 20 CMBS loans in total, with eight loans not meeting the minimum debt service coverage ratio threshold this quarter compared to 16 loans in Q1. Of these eight loans, four do not have covenant waivers. Cash management is not expected with these four loans since AHIP is currently on all loan payments, and has had improving results in the past three quarters.
I will now turn the call back to Jonathan for some closing remarks.
Jonathan Korol
Thank you, Travis. In closing, I would like to express my enthusiasm about the improvements in our operating business and balance sheet over the last year. The strong performance of our properties during the historically difficult period has engendered the confidence required to make the announcements that we have made today, reinstating our distribution is a strong signal about the belief that our management team has in our business.
Our goal remains to drive total return for our unitholders through a sustainable distribution and unit price appreciation. We now have the framework to reinvest in our business through a robust 2022 capital plan and as well as be an opportunistic buyer of growth assets that are accretive to our portfolio. Finally, let me convey my appreciation to our teams at the property level for their continued dedication to providing a great guest experience, also the enduring support and hard work of our corporate team.
So with that overview of our third quarter, and recent initiatives, we will now open the call to questions from analysts. Operator?
Question-and-Answer Session
Operator
[Operator Instructions] Your first question comes from the line of Lorne Kalmar with TD Securities.
Lorne Kalmar
Thanks. Good morning, everybody. On the RevPAR trends, you guys are obviously trending towards 2019 levels. When do you guys think you'd get there? And would it be fair to say that the resumption of business travel would be the big catalyst for that?
Jonathan Korol
Yes, that's fair to say, Lorne. I think that's the missing piece to this equation. And you know, quite frankly, we're not so concerned about the win, because we're quite content with how we're performing while we wait for that. So, this is hard to pin down a month. Certainly we look at national data, and we read the headlines, and we read what companies are doing, but we suspect that we're going to continue to see improvements in corporate demand over the coming quarters.
Lorne Kalmar
And I guess just following on that, would it be fair to say that the group versus leisure demand is still 30:70?
Jonathan Korol
It may be more like, as you said, leisure 70 and group business 30, is that what you said?
Lorne Kalmar
Yes.
Jonathan Korol
Yes, I mean maybe it's 65:35 now, right? So, we are seeing some improvement on the corporate and group side, but nothing overly substantial.
Lorne Kalmar
Fair enough. I guess some improvement is better than no improvement. And then, maybe just lastly for me, you guys kind of mentioned acquisitions during the closing remarks, so what do you guys see, and how do you think about it, and yes, what's out there?
Jonathan Korol
Sure. There is a substantial amount of new products coming to market in Q2 and Q3. The bid ask spread closed somewhat in Q3, at the beginning of Q3, and we saw some large public and private transactions that occurred. There was a lot of product that came to market in August and September. Some of that didn't trade. But the ones that did trade are meaningfully increasing per key levels than what we've seen nine months ago. So, there's significant demand in the capital markets, and from both private equity and REITs for select service product. And we'll continue to mine for opportunities.
Lorne Kalmar
Yes. And then -- Sorry, just one last one, I guess, with the Condor acquisition, obviously some smart money going after your type of product. Have you guys had any inquiries on your front from anyone?
Jonathan Korol
No.
Lorne Kalmar
Okay. Thanks so much. I'll turn it back.
Operator
Your next question comes from the line of Joanne Chen with BMO Capital Markets.
Joanne Chen
Hi, good morning.
Jonathan Korol
Good morning.
Joanne Chen
Maybe just sticking with the acquisition side of things, have you -- given some of the recent transactions, are you starting to see really pricing, really getting more competitive, or it hasn't been kind of satisfied over the past year -- sorry, past quarter, sorry, time last two years just flew by so…
Jonathan Korol
Yes, yes. Do you mind just repeating the last two sentences there, Joanne?
Joanne Chen
Sorry, just in terms of on the pricing principle, what are the -- your targets of acquisition, are you starting to see competition really pick up for you guys?
Jonathan Korol
Sure. Yes, no, the competition has been there really throughout the last year. There's been -- it's not lost on the institutional investor, and the investors in the private equity space that have deep pockets that how well select service has performed as a segment within the broader hospitality industry. And so, there's a continued demand. We mentioned the -- you were asking -- for I think a proxy on per key, there's the Condor acquisition of course is north of a 160,000 a key, which really sets the bar for the -- in the public markets for where select service is trading.
Joanne Chen
Right, okay, that's helpful. And I guess are there particular markets that you guys are more focused on and continue to expand right now?
Jonathan Korol
Yes. We were focused on markets where we see good growth trajectory that meets or exceeds the growth trajectory that's in our existing portfolio. Those tend to be in the markets that where you have net population migration, but we're also mining for deals where maybe that's -- it's more of in the middle of the country where there's an opportunity to purchase below replacement cost and perhaps at a level below 2019, where there's still some built-in growth simply by the return of the corporate customer and the business traveler. So, we're not focused on one specific area, but of course, we really, really, really do like the select service business in the suburban markets.
Joanne Chen
Right, okay. And I guess shifting gears a little bit on the -- it's nice to see that the ongoing improvement in your NOI margins, but just kind of thinking over the near-term, how should we be thinking about what would a good one rate would be over the next couple of quarters?
Jonathan Korol
Yes. So, we have a paragraph in our MDA about this specific topic and one thing we're establishing goalposts, which is, we're not going back to 2019 levels, but we're probably not going to be at the levels that we've been at in the last in 12 months. So, that we believe that translates into a permanent 100 to 200 basis points improvement in GOP margins going forward.
Joanne Chen
Okay. No, that's good to hear. And you guys talked a little bit earlier about on the CapEx delay, but should we start to think that for the CapEx month of kind of pick up starting in -- maybe in Q4, or should we think about it later on in early 2022?
Jonathan Korol
Yes. We'll think about it in the latter half of 2022 in this, Bruce spoke a little bit about supply chain and really labor crunches in some of the markets. We think we can actually save money by delay and that -- and so we'll balance that with our -- the really in some cases some stellar ROIs that we can generate on these renovations.
Joanne Chen
Great, okay, that makes sense, just right through the inflationary period. Okay, that's it for me. Thanks very much. I will turn it back.
Jonathan Korol
Thank you.
Operator
[Operator Instructions] Your next question comes from the line of Matt Logan with RBC Capital Markets.
Matt Logan
Thank you, and good morning.
Jonathan Korol
Good morning, Matt.
Matt Logan
In terms of your distribution, can you talk a little bit about how you landed on what appears to be a very prudent and sustainable $0.18 level? And how you're thinking about the balance of growth and retain earnings going forward?
Travis Beatty
Yes, this is Travis. I can tackle that one. We've been guiding through the summer that we were going to come back with a distribution in 2022 that was something we viewed as sustainable for the long-term. So, on our numbers, the distribution that we've come out with is going to be sub 50% on our FFO. So, we think that that number offers our unit holders an attractive yield at our current unit price, but it still allows us to maintain financial flexibility and discipline on the balance sheet. With that payout ratio, we should be able to manage our leverage down modestly and we have some flexibility to pursue acquisitions in 2022, if they're modestly dilutive without putting too much pressure on that distribution. So, we think that number will be sustainable in the long-term and it reflects our confidence in our operating outlook. When we saw what happened to our earnings in Q3 due to the Delta variant, it was a relatively modest impact. And to the extent that there's future variant concerns, we think our operating cash flow will be able to support this in a long-term.
Matt Logan
And in terms of your 2022 CapEx program, can you talk about where you plan to deploy the capital and maybe what type of returns you're targeting?
Bruce Pittet
Yes. Hi, Matt, it's Bruce. So, we have some hotels in the Northeast that's -- that we're targeting for renovation next year. As Jonathan mentioned, we anticipate those renovations really be in the back half of the year or maybe even the back third of the year, just for what it's worth. Those properties have been actually fairly high performing, especially in New Jersey through the pandemic. And we think we've got an opportunity to make a strategic investment in those hotels and position them for further growth, especially on the rate side.
Jonathan Korol
So basically - on the ROI side, Matt, I think what we're underwriting on these PIPs is north of what we're seeing on yields coming in -- going in yields on acquisitions, so high single-digits, low double-digits.
Matt Logan
Good color. And maybe just changing gears to acquisitions. Like -- are there any like hotel segments in geographies that you're more focused on than others? And does the -- certainly the robust pricing environment change your view of whether you're focused on portfolios or individual assets or vice versa?
Jonathan Korol
Well, we're in the market for both portfolios and single asset deals. The -- in terms of segments that we're targeting, well, I'll break it down by hotel type and the hotel brand. Of course, we own Marriott, Hilton and IHG. We certainly are happy with our relationships with those brand partners and are seeking to expand them on the hotel types. If you look at the STR scale, we're in the upper mid-scale and upscale portions of the segmentation, we'd love to own a whole bunch more extended stay properties for sure. We're about 30% extended stay right now. Close to 48% of our room count is suite properties. We would like to maintain that balance, if not increase the extended stay portion. And geographies, like I mentioned earlier, we're very opportunistic and just because there is a tremendous amount of money flowing into the Sunbelt right now doesn't mean that we're going to ignore other areas of the country that may offer growth opportunities and a better return on investment.
Matt Logan
Last one for me, in terms of new supply over the next two years, do you see any markets that could have headwinds or did deposit in construction over the pandemic largely negate some of those concerns?
Jonathan Korol
Deals that were in the grounds before the pandemic got completed, so -- but the pipeline of deals that is, that are pursuing permits and going into the ground is dwindled dramatically. So, not to say that if pricing continues to head north that more developers won't get back into the game, but still there is going to be headwinds with respect to sourcing materials at an attractive level, sourcing labor, sourcing construction financing. So, we feel very strong that the next 24 to 36 months should provide a welcome respite to supply pipelines in most, if not all of our markets,
Matt Logan
I appreciate the color. I'll turn it back. Thank you.
Jonathan Korol
Thank you.
Operator
And there are no further questions in queue at this time. I'll turn the call back over to you, Jonathan, for closing remarks.
Jonathan Korol
Thank you again everyone for joining us on our call today. I look forward to speaking with you in March when we report our fourth quarter 2021 results. Have a good day.
Operator
This concludes today's conference call. Thank you for participating. You may now disconnect.