Ark Restaurants (NASDAQ:ARKR) Q4 2020 Earnings Call

0:00 Greetings. Welcome to the Arc Restaurant's fourth quarter 2020 resource conference call. At this time, all participants are on a listening only mode. A question and answer session will follow the call. Anyone who requires operators during the conference, please press star zero on your telephone keypad. Please note, this conference is being recorded. I will now turn the conference over to your host, Sonal Shah. Thank you, operator. Good morning and thank you for joining us on our conference call for the fourth fiscal quarter ended October 3rd, 2020. My name is Sonal Shah and I'm general counsel of our freshmen. With me on the call today is Michael Weinstein, our chairman and CEO, Vinnie Pascal, our chief operating officer, and Anthony Sirica, our chief financial officer.

0:51 For those of you who have not yet obtained a copy of our press release, It was issued over the news wires yesterday and is available on our website. To review the full text of that press release, along with the associated financial tables, please go to our homepage at www.arcrestaurant.com. Before we begin, however, I'd like to read the Safe Harbor Statement. I need to remind everyone that part of our discussion this morning will include forward-looking statements and that these statements are not guarantees of future performance. and therefore undue reliance should not be placed on them. We refer everyone to our filings with the Securities and Exchange Commission for a more detailed discussion of the risks that may have a direct bearing on our operating results, performance and financial conditions. I'll now turn the call over to Michael.

1:46 Hi, everybody. So to discuss revenue by portfolio, each part of the country. Florida has been pretty much consistently open from June when they allowed us to reopen. Some restrictions are in place, but revenue coming from Florida, even though the restrictions included at various times, shortened hours, and still include 50% occupancy, most of our Restaurants are in Broward County, so it's 50% occupancy indoors, social spacing, outdoors, but we are experiencing pretty good volume levels given the pandemic, and I would take a guess that in any given week, if you took all these Florida properties together, we're probably down 20% as a whole from pre-COVID conditions. So Florida's been quite good in generating cash flow.

2:59 The only thing that we are a little disappointed in is the volumes of JB's, which is a spectacular beach location, but JB's tends to have a significant portion of its business to be an older clientele, and we think they've just abandoned the idea of eating out, even if it's in outdoor cafes. Alabama has been very good. Again, once they lifted restrictions, we're still operating under 50% guidelines for indoor dining. But both of our restaurants in Alabama have done curbside pickup, and they're busy. I would say to you that during the summer when Gulf Shores was in – We were exceeding buy-ins that we had prior year, somewhat because of curbside delivery, but just people looking for things to do, and restaurants in Alabama seem to be that alternative, which replaces any other social activity.

4:13 Las Vegas, we were doing well until recently. We're right now in... The slowest part of our season in Vegas, historically. But Vegas has put a 25% cap on indoor dining and on the number of rooms that casinos can have available. So our business has been hurt dramatically there. It's half of what it was three or four weeks ago. But again, it's a slow season. I'm not so sure there's demand for more things. Very much more demand than 25% of room capacity right in this period. Once Christmas Day comes and buying picks up, we used to have million-dollar weeks in that period. We're not going to achieve that again, especially with these restrictions. So Vegas, which went from some cash flow, is now negative cash flow a little bit, not terrible.

5:18 I'm sure it will improve once we get out of this three-week period, which is the slowest part of our year there. Washington, D.C., we were doing well throughout the summer. In Sequoia, we had 600 outdoor seats. They were doing well. We were generating some decent revenue. But as of a couple of days ago, indoor dining has been closed. at Sequoia will be fully closed at the end of this week. We had some mild weather. We tried to keep the outdoor open this week, but economically it doesn't work. And we'll be closing the whole thing temporarily until the restrictions are lifted.

6:07 The goal of the mayor is to lift the restrictions January 15th. New York... New York was losing money. Every single restaurant we had throughout the summer, even with Brian Park's outdoor cafe seats, we just can't get payroll and rent to a place that the equation makes sense. Volume at Brian Park literally was 10% of what it used to be, even throughout the summer. Over this whole thing with our bigger restaurants, Sequoia, Brian Park, Robert in New York. You know, there are no events. Social distancing makes it impossible to load up on customers and revenue. So New York was especially hard hit. Brian Park, again, did 10% of what it used to do.

7:07 Robert, 10% of what it used to do. There are no outdoor seats at Robert with 25%. Occupancy allowed throughout the period before outdoor dining was closed last week. You know, we were doing 10% of what we used to do. Clyde's, same story, no outdoor seats, indoor seating restricted to 25%, 10% of what we used to do. El Rio Grande, we have outdoor seating. It did fairly well during the summer. Thank you for joining us. With one exception in New York, which is Bryant Park, we're out of business right now. We're out of business in Washington, D.C.

8:18 We're restricted dramatically in revenue in Las Vegas. Florida and Alabama are okay. You may ask the question, why are we open at Bryant Park at all? Well, we have a landlord and a lease that requires us to be open. were trying to renegotiate the rent. There was some abatement of rent during the period up until now through December 31st. Obviously, January, February, and March, we're going to need help, and we're going to go back to the landlord. We have a call scheduled. So the best I can say in terms of revenue and cash flow is is that we had some, our corporate overhead is down from $11 million to $7.5 million.

9:16 What does cash flow mean at the restaurants? If we're positive cash flow, it's sort of on the backs of landlords who have given us breaks in rent and managers and staff that have taken less of a salary than they should. You know, there was a period of time, not that we want pats on the back, it was necessary, where the most anybody could make in the whole company, you know, 2,300 people, you know, of which 40% is management salary employees. The most anybody was allowed to make from the March period when everything was closed down to June when we started a staggered reopening of restaurants.

10:04 restaurants was $1,000 a week. So you have salaries that went down 95% in some cases, and in most cases by far more than 50%. As the restaurants opened, we started to be more aggressive about giving people back part of what they used to earn, but most people are on 65%, 70%. I think that's well explained in the press release. So we've done everything we can do to limit expenses in payroll. We've reduced rents at the restaurants. We reduced our office rent. We abated all capital improvements with the exception of one at Rustic Inn in Florida where we had a new barge that we were putting out on the canal that was mostly complete when this whole thing started.

11:02 So we chose to finish it and replace the old barge. So it's hard. That's all we can say. It's hard. Do we have optimism going forward? Yes. We feel that and we projected that we'd be positive cash flow the June quarter. We think as the vaccine rolls out, as people began to realize that they can start to slowly recover their lives. We think our restaurants are well positioned. They're good assets.

11:47 The rents are reasonable even when we're paying full rents in relation to the volume that these restaurants used to do. We'll work with landlords to try to phase in full rents as volumes pick up. We'll do the same with payrolls. But we're sort of optimistic about our future. Our balance sheet is good. I'm going to turn the call over to Anthony for a few seconds to explain the new legislation that was just proposed by Congress with regard to what it means to us with our PPP money. So, Anthony, why don't you go into that and talk about, please, our balance sheet and where we think we are in terms of being able to sustain this effort. Sure.

12:43 Okay. The someone on the lines has a lot of background noise. If they could mute their phone, it's a little difficult to hear on the phone. So, a couple of things. As of year end, we had $16.8 million of cash. We currently have about $13 million in change of cash. The reduction has to do with we acquired a restaurant in Florida called Blue Moon Fish Company, and purchase price there was about $1.7 million of cash with a balance of $1 million in notes, payable over four years, 5% interest. We made principal payments on our debt facilities and our notes for another $700,000.

13:28 We had some CapEx to get the barge installed and operational, and obviously we had some losses. Our debt is $45 million, which includes $30 million to our lender, which consists of a revolving credit facility of $10 million and $20 million in term notes related to purchases of restaurants over the last four or five years. The other $15 million is the PPP loans. as we discussed in prior filings. We have received approximately $15 million. We expect to start the forgiveness process at the beginning of the new year on a bunch of the loans. We are looking at the current legislation that came out yesterday that was approved by Congress last night that's waiting for Trump's signature.

14:20 It's 5,600 pages. I've managed to narrow it down to a couple hundred pages. that impact us. The biggest takeaway right now is the Congress has overridden the IRS in its effort to make the forgiveness of the PPP loans taxable. So if I could just go back when the CARES Act was what came out as law in March, the PPP loan forgiveness was intended to not be taxable. meaning that the expenses would be deductible and when the loans were forgiven, you would not have to pick up that income. So, it was essentially a double dip. The IRS came out with a ruling in November on doing that and saying that the company could not deduct the DPP expenses that were paid with loans that were forgiven.

15:17 We took the position that at that point in our year-end financial statements, that we were still going to record deferred tax assets for the amounts of the losses related to these expenses. And then last night, Congress approved the bill, which again overturns this. So long story short, the expenses that the money was paid with are deductible and the forgiveness of the loans will not be income, which in our case creates a will have a operating loss on our tax returns for the September year end, which we will then carry back the prior years and recapture taxes that we paid at 35% rates when we're currently paying 21%. So we expect to have, you know, an NOL carryback claim of approximately $2.5 to $3.5 million that we'll file in the next three or four months.

16:18 A couple other things in the new legislation that appears, and again, we haven't finished reviewing it, but it appears that there are other expenses that are going to be eligible to use PPP funds for things like cost of goods sold purchases and items of that nature. And we're also looking into if any of this stimulus will be available to a company like ARC to apply for additional loans. But that we're still trying to determine what the legislation means. It's voluminous and we only had a couple of hours to look at it. Michael, back to you. All right. Thank you, Anthony. I think that's a good explanation.

17:07 So we think our balance sheet is in good shape now with the NLO carryback, you know, and that $3 million, which is our expectation, putting back on our balance sheet the granting of the PPP money. What Anthony said, there are other things in there. We're not sure of this, but it seems to be something – That could be tangible for us. The original PPP loans were meant for payroll and rent. This bill seems to expand it to include cost of goods sold. So to the extent that we had cost of goods sold that can be included...

18:04 As part of the grant, our expectation of some $10 million in grants may go up by a few million dollars, which means the $5 million, we took in $15 million all told in PPP money. Is that right, Michael? Yeah, sure. Yeah, so the point there is that the way the law was constructed, you had to spend the PPP money within 24 weeks of the money hitting your bank account. For the New York restaurants and BC, the majority of the money came in in early May. So we essentially had until mid-October to spend the money on payroll and rents and utilities. That was very difficult considering, number one, the restaurants didn't open until the end of June or the end of July. They opened initially in New York just with outdoor dining. Indoor dining was limited to 25%, so we could not We didn't have the volumes in order to have the payroll to use all of the money by the end of the covered period. I think what this legislation is saying that, you know, so we were saying, okay, if we were able to use 30, 40% of the money on payroll and rent, the other 70 or 60%, we either will return the money or we'll keep it as a loan.

19:27 What Michael's saying is, that percentage may go up based on our current reading of the new legislation. It appears that those old inventory, perishable inventory purchases are now included in the eligible expenses that had to be expended during the covered period. Thank you for the better explanation, Anthony. All that being said, I'm happy to take questions. And at this time, we will be conducting a question and answer session. If you would like to ask a question, please press star 1 on your cell phone keypad. A confirmation tone will indicate your line is in the question queue.

20:13 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 start keys. One moment, please, while we pull for questions. Our first question is from Leland Meath with Value Investment Principles. Please proceed with your question. Good morning. I would just like to know if the acquisition that was announced in December, will it be EPF-creative and SPF-positive? All right, so we bought a restaurant that... That historically has thrown off 15 to 20% of its revenues in positive cash flow.

21:06 Revenues used to be $6 million. So the 2.7 purchase price, 1.7 down and $1 million over four years in equal installments. If you were buying that million dollars in cash flow, you would think that was a very cheap purchase. The restaurant is in Fort Lauderdale on one of the canals. We validated what the sales of other similar restaurants are in the area who are situated also on the canals. This was, by the way, churning out $6 million a year for Some 20 years pre-pandemic.

21:59 For whatever reason, we were able to reach this price with the sellers, two good guys, fishermen who established the restaurant 26 years ago. They didn't want to do it anymore. The revenues are obviously down for no other reason than the restrictions that are imposed on the restaurant. Thank you very much. So I would tell you, until we get in there and really take a look at payroll and what influence we can have on cost of goods sold, we don't know that we're, as of yet, throwing off any cash, positive cash flow.

23:14 I think we are, but it's not empirical yet, and there's work to be done. But I can tell you that we're very happy with the sales at this point. In two weeks, they're probably down 20%, 22% from their historic sales. So that's in line with everything else we're doing. So we think we made a very good purchase that as the pandemic lifts and people restore to their old habits, I think we've got something that could be significantly beneficial to us. Okay. Thank you very much. My pleasure. Thank you. And our next question is from Roger Lipton with Lipton Financial Services.

24:06 Please proceed with your question. Yeah, hi, Michael. Hi, Rauscher. How are you? We're all good. I hope you're the same. Just dealing with it still day to day as we all are. Good summary. The PPP loan, so the cost of goods possibility, well, that is to hope that that would allow you to use up the entire $15 million. Yeah, I don't know if it'll be the entire $15 million, but it will definitely be higher than what we were estimating. We were figuring about $10-11 would be forgiven. You know, that will go up if I'm reading this right. Again, I want to go through it a couple more times and consult with our external auditors and a couple other firms that are probably studying this as we speak.

24:55 But yeah, I mean, we'll definitely get closer to the $15 million. And going forward, again, it's early and you're studying it, so what's your hope? I was a little confused with the old bill versus the new bill and it changes. So the hope in terms of the new bill is what? Well, the new bill, it adds in the food purchases. Okay. But it adds it in. It appears it adds it in retroactively back to when the CARES Act was passed. Okay. That's what I meant by that. and then there are additional loan opportunities. There's another $300 billion of loans available and I want to see having gotten to the part in the law yet who's eligible for those loans if ARC is eligible and then how you determine the amounts if you have prior PPP loans. I would assume there's caps and calculations and things of that nature so haven't gotten to all that yet, but we will figure that out over the next couple of weeks.

26:03 Right. So you don't know yet to what extent, if at all, you'll be able to access the new money? No, we don't know. Okay. We don't know yet. Okay. That's helpful. And, of course, obviously $15 million reduction of debt off your balance sheet, 11 to 15, is okay, right? Yeah, yeah. What about, Michael, you didn't refer to the – The online betting situation. Anything at all? almost five years ago, I guess. We have about five and a half, six million dollars involved in that, Anthony, between equity and loans.

27:07 We took that position because we thought the situation in Atlantic City was eroding dramatically and that the state would have to at some point issue a casino license in the northern part of New Jersey. The density being significant and and what we were looking at was New York State saying at that time, five years ago, that in seven years they were going to have downstate gaming, which caused MGM to buy Yonkers and Aqueduct is active as a partial casino right now, mostly slots.

27:53 So we thought Jersey would have to respond. The partners in Meadowlands were annually fulfilling a cash call because, you know, the thing was losing money. We were operating the food pro bono. We weren't making money on it. We weren't losing money on it. That still exists today. and then came sports betting and Jersey was the first one to approve sports betting and went to the Supreme Court and the Supreme Court allowed it and our life changed dramatically and it's I think the largest grossing sports betting venue in the United States right now.

28:42 There are days where we do $10 million in handle and So it's throwing off cash, significant cash, pre-pandemic and even during the pandemic. We don't see that cash. It's not distributed. So, Anthony, am I right on the accounting? We don't show any revenue or K-1 income from that, correct? Correct. This is a cost method investment. We show, to the extent we get cash, we would show it as a dividend. Right. So that's been, we've had some interest paid on our notes, but not significant.

29:29 So what we're hoping is that New York accelerates because of New York's budget deficit with the pandemic. We're hoping that New York accelerates downstate gaming from 2023 to 2021. There's some indication for him. I may do that. We believe the minute he does that, New Jersey will have to respond. And the Meadowlands is actually closer from downtown New York than either Aqueduct or Yonkers in terms of the time it takes to get there.

30:14 So we're very hopeful. Hard Rock is one of our partners. and they would be the operator of the casino. Initially, it was thought that we would have to have a partner that operated Atlantic City Casino, somebody that was licensed as our partner at the Meadowlands. Hard Rock has since, in sort of defense of their ability to be the operator, bought the old Taj Mahal and operates as a hard rock in Atlantic City, an investment I'm sure they're not happy with right now. But it did put them in a position to be the operator of the casino in the Meadowlands if that should occur. So that's basically what's going on there.

31:04 The New Meadowlands LLC is operating at a positive cash flow right now, so there are no cash calls on us. And to some degree, we're getting interest on our Outstanding loan to the facility. Okay. So we're just waiting on Cuomo, and then presumably that would – I mean, everybody's desperate for money, so presumably – Yeah, we think it triggers it, and, you know, we also think we're by far the best site available in northern New Jersey for a casino. Got it. Okay, good. Thank you, Mike, and I hope to see you soon.

31:49 You're welcome. Same. And as a reminder, if anyone has any questions, you may press star 1 on your telephone keypad to join in the Q&A. And our next question is from Bruce Jeller from Jeller Ventures. Please proceed with your question. Hey, good morning, guys. Good morning. Thank you for your efforts through this unprecedented difficult period. I'd like to go back to the deal that you announced.

32:34 The economics of that sound quite attractive particularly as the world gets back to normal. Do you see other opportunities like this right now? I know there's so many restaurants that are Just barely hanging on. While this probably isn't the best time to go out and spend a lot of money, at the same time, there's probably some opportunities that are priced at levels that you may never see again. I'm just curious if there's other opportunities like that that you could take advantage of right now if you wanted to. If so, what are your plans in terms of How aggressive you get in doing that, and then how do you address the capital needs of doing that?

33:24 Because, again, while it's a tough time to make big bets, it does seem like there could be a positive stair-step function for the company here to take advantage of some of these situations and betting on the world getting back to normal next year. So, Bruce, let me take it from the micro, this one deal. As you know, our preference has become to buy restaurants that own the property on which they sit. We did that in Alabama. We did it with Rustic. We did it with Strucker's.

34:10 JBs, we have an option on the property. I don't know that we'll ever be able to get it at the price that we think we would pay. But it did come with a very cheap 25-year lease. So for intensive purposes, we feel like we own that. Blue Moon also comes with a very strong 26-year lease. The first 15 years are basically a 6% rent. and then it sort of accelerates in the last 11 years. But the first 15 years are, you know, more than a reasonable rent. And it's a property we can never own. In truth, it's a restaurant that none of the principals of ARC have seen.

34:55 We were shown this by a broker who we knew. We have management down in Rustic and JB's. who were nearby, who, you know, we relied on. We also have friends that live there that, you know, that go to that restaurant, Blue Moon, and everybody praised it as, you know, it's really a great location, great spot, great decor, great food. That's all we kept hearing. And the problem was how to buy it because the price we felt was a bargain. We were able to extend this one time with our bank to allow us to use existing credit line to make this kind of purchase.

35:50 But that's gone. We have a conservative bank, and I think you would agree that most banks aren't lending to restaurant companies, period. you know it's impossible to figure out how or it was impossible to figure out how to go forward and make other acquisitions for like type of situations and in the last two weeks I've gotten two calls and I'm not going to divulge who they're from but they're They're extremely wealthy groups. One, a family office with some $4 billion in it.

36:41 And another one, a corporate, I guess, group not involved in the restaurant business. but seize the opportunity as you just described. And both of them said that they would like to partner up with us if we saw anything that was attractive. I didn't go into the details of partnering up, what that meant. I know one of the group has gaming interests and sort of would like to buy ARK stock and either a convertible preferred or something that converts into off-stock because they're not only looking at the capability of us to acquire other restaurants but they really got their eye on the Meadowlands to own a piece of that through us.

37:43 So I think there's ways to do joint ventures with others We did that once before in Florida at the Hard Rocks when we did the food markets in the Hard Rocks some 11, 12 years ago. I think that possibility exists. We're not seeing deals. The flow is not that attractive anymore. We are seeing deals, but we're seeing them at six, seven times EBITDA. We're buyers at three times EBITDA, three and a half times EBITDA. We may be too conservative, and therefore we'll not see anything, you know, other than Blue Moon.

38:34 But, you know, we're sitting here with a lot still unknown of how this recovery is going to take place and why... My inclination is pent-up demand and things will go back to normal. I can't be sure of that. And what we're trying to do is protect our balance sheet and not leverage ourselves up with debt. If we find something, we've got to find an equity partner. And just because I have an equity partner, it doesn't mean I'm going to overpay or pay what everybody else is going to pay. So I don't think you can, the expectation should not be that you're going to see a rash of deals or two or three or four deals, whatever, a rash or less than that.

39:27 From us, I think we're going to stay here. We've got three or four months to try to see how, you know, the vaccine impacts, you know, the country and, you know, restaurant sales and I'd rather pay a little bit more knowing things are all right than take a shot right now even with somebody else's money. The attractiveness with Blue Moon is we were paying less than three times historical earnings for it. Well, you know, it's hard to say no to that. And I think we're going to be proven very right. Those deals aren't going to come frequently. Sure, that all makes sense.

40:15 I read somewhere recently, I don't know if this is true or what your view is, but something like 17% of all restaurants in the U.S. have closed during the pandemic. If that's a true number, is there the potential that even if the world doesn't fully come back to normal, that business could actually be better managed Really better than expectations just because supply has gone down so much. Well, it depends upon the venue. I would tell you that in New York City, which we know pretty well, the number of highly recognizable names that have gone out of business permanently is astounding to me.

41:10 But when you think about it, logically, you know, a lot of those names were one-off for an owner, an independent restaurateur who owned one or two restaurants. And their business has been decimated. Nobody understands, other than people in our business, I believe, What this has done to the employees, you know, being out of business for three months, coming back, now having to go back on unemployment again. A lot of the base that we draw from has moved back to other areas of the country where they came from.

42:02 They came to New York for, you know, a particular reason and, you know, school culture and The arts, whatever it is, and they were employed by us as waiters, waitresses, barbacks, bartenders, whatever. Well, now they're living in an expensive city. The reasons for coming are gone. They went back home. Even with outdoor cafes, we had difficulty finding waiters and waitresses to work in. We have a lot of Hispanic population in our kitchens. A lot of them have gone into construction. Construction industry has been very strong in New York. And, you know, we had two sous chefs at Robert's who left and they're working in construction.

42:49 They ain't coming back. The restaurant industry doesn't provide them with consistent, you know, salary. So everybody's sort of on edge. And so there are two things I could tell you about New York. The controller's office in Manhattan fully expects 50% of all restaurants to go permanently out of business in New York City. That's what they're saying. Do I think it's that bad? No, but if you said to me 30%, I would say, Jesus, thank God it's only 30%. If you're a single restaurant owner owning one location, you're screwed. And what has happened just prior to this, I mean, the industry economically wasn't doing well before the pandemic because of the increase in minimum wage to tipped employees. Our tipped employees went from, you know, because it used to be a $10 minimum wage, we were allowed a $5 credit toward minimum wage. Then it became a $15 minimum wage, but they didn't increase the tip credit.

44:05 stayed at $5. So over a three-year period, all our ticked employees, which 60% of our employees went from a $5 net pay to a $10 net pay. So 60% of our employees over three years got a 100% raise. Who can live with that? You know, rents, which are now negotiable, were completely out of joint in terms of any economic equation for restaurants. But we also have the problems with insurance premiums, which are skyrocketing, you know, in terms of our health care, major medical premiums, insurance premiums in every area are going up dramatically. So the equation was bad before the pandemic. So if you own a restaurant and now you close for three months, then you got to put in, in order to open, you have to put in new ventilation, germ-killing systems. I mean, at Bryant Park, that cost us $50,000. I have no, you know, I forgot the exact number.

45:16 You know, our restaurants are, I mean... Pumping out the purest air you can pump out, given technology. We were able to make that investment, but go talk to a guy who owns a 60-, 70-seat restaurant. Go talk to the woman who ran Prune in the East Village, which is a notable restaurant, and she couldn't make a living before the pandemic, and there's no decision for her. Close it. So... So I fully expect 30% of the restaurants in New York City to close. Now, is that beneficial to the restaurants that remain open? I would imagine it is. Unfortunately, you know, I've said this for 40 years.

46:05 When a restaurant closes in New York, it doesn't become a furniture store. Eventually, it becomes another restaurant. So, you know, once his confidence is back, those empty spaces will not be repurposed to other retail. They'll become restaurants again because there's a passion that people have for owning a restaurant. They can, in the past, pick up investors to help them out. So it will be, you know, a short-term benefit to have all these restaurants closed, but I think in the long term, you know, it'll go back – to the same number of seats we've always had. Thank you. That's very helpful. Welcome. Stay safe, Bruce. You too.

46:54 And we have reached the end of the question and answer session. And I'll now turn the call over to Michael Weinstein for closing remarks. All right. Thank you, everybody. Obviously, we're out of the office. So, We have somebody there every day to mail, but nobody's picking up the phones. If anybody has a question, I'm happy to try to answer it. My cell number is 646-322-9197. So feel free to call during business hours on that number. I'm happy to take calls. I wish you all well for the holiday season and stay well physically and emotionally.

47:44 It's been a tough grind for everybody. I hope your families are all well and we'll speak to you in the next quarter. Thanks again for attending this. And this concludes today's conference and you may disconnect your lines at this time. Thank you for your participation.