Navigator Holdings Ltd. (NYSE:NVGS) Q4 2022 Earnings Call Transcript

Navigator Holdings Ltd. (NYSE:NVGS) Q4 2022 Earnings Call Transcript March 21, 2023

Randy Giveans: Welcome to the Fourth Quarter Financial Results for 2022. We have with us Mads Peter Zacho, Chief Executive Officer; Mr. Niall Nolan, Chief Financial Officer; Mr. Oeyvind Lindeman, Chief Commercial Officer; and myself Randall Giveans, Executive Vice President of Investor Relations and Business Development in North America. I must advise you that this conference is being recorded today. As we conduct today’s presentation, we’ll be making various forward-looking statements. These statements include but are not limited to, the future expectations, plans and prospects from both the financial and operational perspective and are based on management assumptions, forecasts and expectations as of today’s date and are as subject to material risks and uncertainties.

Actual results may differ significantly from our forward-looking information and financial forecast. Additional information about these factors and assumptions are included in our annual and quarterly reports filed with the Securities and Exchange Commission. With that, I now pass the floor to Mads Peter Zacho, the company’s Chief Executive Officer. Please go ahead, Mads.

Mads Peter Zacho: Thank you, Randy and good morning and thank you for listening in. Please go Slide number 3. Our fourth quarter came in substantially stronger than the previous quarter with revenues of $123 million EBITDA, just below $60 million and net income of $10 million. Our balance sheet is robust with cash of $153 million plus $20 million of undrawn facilities at year-end. The delivering of our balance sheet continued net debt reaching just over $700 million by year-end. This is despite us buying back shares since mid-December. We finalized our refinancing efforts for now, actually just yesterday. And currently, we have our next maturities only from 2025 and onwards. So our next discussions with our banks will certainly be around growth projects.

Commercially, our utilization came in just over 94% in Q4 compared to our guidance of above 90% and above the 91% reached in Q4 2021. Terminal throughput was 263,000 tonnes in Q1 that ran above the nameplate capacity which, as you may recall, for now is about 1 million tonnes per year. Seaborne ammonia transport was strong and we had 10 vessels transporting ammonia during the quarter. Fortunately, we’ll grow our vessel capacity through the acquisition of 5 secondhand vessels, vessels that we know really well because we have commercially managed them over the past few years. We expect to take over all 5 a bit faster than what we had previously announced, most likely will be done by April. And that’s great, of course, in the current market which is pretty robust.

Our joint venture with Enterprise successfully continues to develop. We continue to run at capacity and we have great plans for expanding the terminal and Randy will talk to that in a little bit. The outlook seems right for now, Q1 is almost over and we’ve seen height utilization above 95% so far this quarter. The terminal throughput in Q1 is expected to be strong again at around 260,000 tonnes and ethylene is in high demand in both Europe and Asia. Handysize rates have gradually firmed and Oeyvind will talk a little bit more about those in just a few minutes. So, I guess this makes us confident that our financial performance in Q1 of this year is going to be robust. This current healthy demand for seaborne gas transport is well complemented by modest handysize vessel order book and also an aging global fleet.

So with that intro, I’ll just leave it to Niall who will take you through the financial results from the last quarter. Please, Niall.

Niall Nolan: Thank you, Mads and good morning to everybody. As we show here on Slide 6, the net income and EBITDA for the fourth quarter was $10 million and $59.4 million, respectively, an improvement on the third quarter of 2022, giving a trajectory that is expected to continue into 2023. The total operating revenues for the fourth quarter were $123.3 million, $9 million less than the $132.3 million for the comparative fourth quarter of last year was $16.5 million higher than the $106.8 million achieved in the third quarter of 2022. The $9 million decrease for the comparative fourth quarter was threefold. First, we had a lower contribution of $7 million from the smaller — the 9 smaller vessels we have in the Unigas pool. Second, there was a decrease of $5 million as a result of pass-through voyage costs as a result of having more vessels on time charters than spot charters of the comparative period.

And thirdly, $1.7 million as a result of having 84 less available days during the fourth quarter of ’22 relative to the fourth quarter of 2021. However, these decreases were offset by an increase of $4 million as a result of increasing charter rates which rose from just under — just over — sorry, just under $22,500 per day for the fourth quarter of 2021 to $23,621 per day for the fourth quarter of ’22, an increase of $1,100 per vessel per day, as well as an increase of $2.6 million as a result of increased utilization which, as Mads said, has increased from 91.4% for the fourth quarter of 2021 to 94.1% for the most recent quarter. We had 3 vessels in dry dock for the scheduled surveys during the fourth quarter, taking a total — taking the total number of dry dockings to 12 for 2022.

In aggregate, these vessels were in dry dock for a total of 375 days during 2022 and cost a total of $16.9 million. As we have no new builds on order, these reduction costs are the only capital expenditures the company had during 2022. And for 2023, it is expected that we will have 7 vessels enter dry dock and a total budgeted cost of $9.2 million. The operating revenue from the Luna Pool was $6.3 million, representing our share of the other participants’ net revenues, with the voyage expenses from Luna Pool of $5.5 million which represents the other participants share of our net revenues from the pool. Consequently, the other pool participants’ vessels contributed $800,000 to us during the fourth quarter and $1.1 million — sorry, $1.4 million over the 12 months of 2022.

Voyage expenses, as I referred to a moment ago, decreased by $5 million or 22% during the fourth quarter to $16.9 million which had the effect of reducing revenue, as I just mentioned, as these are pass-through costs. Our vessel operating expenses increased by 8.7% to $43.9 million for the fourth quarter compared to the fourth quarter of 2021 which resulted in vessel operating expenses per vessel per day increasing quarter-on-quarter by 12.9% to $9,058. This was primarily as a result of timing, timing ordering and delivering spare parts with the average vessel operating expenses per vessel per day for the full year of 2022 being $8,210 per day, a level at which we would expect to maintain or even improve on during 2023. Depreciation of our vessels increased by 19% to — or $4.9 million compared to the fourth quarter of 2021, primarily as a result of the reduction in the estimated useful life of our vessels from 30 years to 25 years which occurred on January 1, 2022.

Depreciation for 2023 is expected to be approximately $130 million to $134 million, an increase in 2022 as a result of the additional 5 ethylene vessels acquired or to-be acquired from Pacific Gas. General and administrative costs decreased by 7.4% for the fourth quarter and 5% for the full year as we maintain tight control on our overheads as well as additional costs incurred in 2021 associated with the Ultragas transaction and the running of our New York office which we closed in mid-2022 that have not reoccurred in 2022. And other income being management fees earned from the other participant of our management of the Luna Pool were $100,000 for the quarter and $364,000 for the full year. We will not benefit from these management fees going forward as the 5 vessels to which they relate have been or will be purchased by the joint venture and fully consolidated into our financial statements.

We redeemed our $600 million Norwegian bond in — on December 23, 2022 and the foreign exchange loss incurred during the quarter relates to the retranslation of that bond between September 30 and the debt was repaid, resulting from the strengthening of the Norwegian kroner relative to the U.S. dollar. Conversely, there was a gain on the cross-currency interest rate swap which crystallized or was realized on the repayment of the bond and the consequential termination of that swap. With respect to the Norwegian kroner bond redemption on December 23, we’ve paid a premium of 1.79% or $1.1 million to those bondholders on the redemption date and wrote off $212,000 of deferred financing costs associated with that bond. The interest expense for the fourth quarter was $14 million compared to $10.7 million for the fourth quarter of 2021 as a result of rising interest rates on the proportion of our debt that is subject to floating interest rates.

We have fixed interest rates or have entered into interest rate swaps for approximately 52% of our debt as at December 31, 2022 at LIBOR or SOFR levels that are fixed between 0.36% and 2% in addition, of course, to our 8% fixed rate $100 million unsecured bond. Our share of results from the ethylene export terminal were $7.9 million for the quarter based on throughput charges relating to 263,000 tonnes of ethylene exported through the terminal compared to 234,000 tonnes during the fourth quarter of last year and significantly higher than the 190,000 tonnes throughput during the third quarter of 2022. In aggregate, during 2022, there were 987,500 tonnes of ethylene throughput which is on or about the nameplate capacity and we expect this level of volumes to continue into 2023.

The profit for our share of the ethylene export terminal for the full year 2022 was $25.8 million which in addition to the $5.3 million for our share of the terminals appreciation gives a terminal EBITDA for 2022 of $31.1 million relating to our share. The tax charge for the full year 2022 was $5.9 million, of which $5.1 million relates to the 21% U.S. tax charge on our share of the profits from the ethylene export terminal. Over $3.8 million of this terminal tax relates fared or noncash taxes. Net income for the fourth quarter was $10 million, as I mentioned, or $0.13 per share giving a total net income for 2022 of $53.5 million or $0.69 per share. Moving to the balance sheet on Slide 7. The company ended the year with a cash balance of $153.2 million against the minimum liquidity covenant from our various banks and credit agreements of $50 million, thereby giving us significant headroom.

The cash balance is after paying the $600 million Norwegian kroner bond referred to earlier which relates to about $72 million. At December 31, our total debt stood at $862 million. As shown on Slide 8, during the last quarter of 2022, we extended the maturity of one of the bank loan facilities by 1 year from 2024 to 2025, refinanced another facility that tranches maturing in 2022 and 2023 by means of a new $111.8 million facility and we entered into a $151.3 million facility for our 60%/40% Greater Bay joint venture to part finance the acquisition of the 5 ethylene carriers from Pacific Gas. The first of these vessels was acquired in December 2022, upon which we drew down $27.5 million on the loan. A second was acquired in January this year and the remaining 3 vessels are expected to be acquired 1 this week, 1 next week and the final vessel expected to be acquired sometime next month in April.

We will pay 60% of the remaining equity portion on these vessels which equates to approximately $49.8 million from available cash — existing available cash resources. Yesterday, as Mads already referred to, we entered into a new $200 million facility which will be used to refinance 2 existing loan facilities that are scheduled to mature in 2023 as well as providing approximately $65 million for general corporate purposes. This loan has a 6-year tenor maturing in 2029 and has a cost of software plus a margin of 2.1%. On Slide 9, we outlined the estimated cash breakeven for 2023 at $19,170 per day. This low level enables us to generate EBITDA throughout the full shipping cycle. In the box on the right-hand side of Schedule 9, we provide our daily OpEx expectations for 2023 across the differing vessel segments, ranging from $7,500 per day for the smaller vessels to $10,100 a day for the larger, more complex ethylene investors.

We also provide a range of the expected annual spends for G&A costs, depreciation and interest expense. On Slide 10, we outlined our historical quarterly EBITDAs showing a marked increase over the past 5 quarters, a trend we expect to continue, along with the effects of our EBITDA on the graph on the right, if our average charter rates were to increase by $1,000 per vessel per day in the increments. And with that, I’ll hand you over to Oeyvind for his remarks.

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Oeyvind Lindeman: Thank you, Niall and good morning, all. If you move to Slide 12, we can see that EIA is showing an increase in American LPG exports during the fourth quarter of ’22. Despite a decrease in natural gas liquids production during the month of December, the winter storm Elliott disrupted some of the NGL production at that time. However, this is now more or less back up to where it was pre-storm. Despite the lower production, LPG exports grew during the period. This can be explained by an unseasonably high LPG inventory in the States, combined with very low domestic consumption. U.S. propane exports continue to rise into 2023. And we can also see that for the handysize segment, where the exports followed suit with increased for the March of this year.

Propane is widening its competitiveness compared to oil. Both energy consumers and petrochemical consumers are looking to LPG due to his current price competitiveness, a widening gap between propane and oil favors demand centers which are able to switch between the two. Similar trends can also be applied to American ethane and ethylene which we can see on Page 13. That excess production of ethane translates to a fantastically competitive base for domestic and international ethylene producers. Argus is quoting market price for 1 tonne of ethane at $180 a tonne at the beginning of March. This favors producers utilizing ethane as feedstock in their production of ethylene. The American ethylene arbitrage to both Europe and Asia is widening. The price differentials have been increasing over the last few months and physical exports have been heading to both continents across the Atlantic Ocean and across the Pacific Ocean via the Panama Canal.

The ethylene export terminal is running at nameplate capacity and we expect this to remain for first quarter and into second quarter of 2023. Ethane exports are showing continued robustness and we anticipate some growth in conjunction and ethane terminal capacity cuts at investors can easily switch between ethane and ethylene and we have a handful of ethylene vessels currently employed in the ethane trade. In addition to energy security, the Europeans have had their hands full in replacing lost more supply from Ukraine. And if you take a look on Page 14, it clearly showing the change in European ammonia marine logistics. Europe recorded a historic high of seaborne ammonia imports for the fourth quarter. The handysize segment benefited the most out of the other gas carriers, enabling consumers to source ammonia from places further.

1/3 or 10 of our handysize vessels were employed in ammonia the fourth quarter. As Mads mentioned, this is double the number of vessels compared to fourth quarter. Natural gas prices which is relevant to the production of ammonia as natural gas is an essential feedstock, has since come down from its winter highs. The price reduction is expected to put a damper on the current ammonia imports. However, we believe ammonia has a tremendous growth trajectory going forward, both in terms of playing an increasingly important role in providing food security through enhanced crop growth but also within the energy transition where it can enable lower carbon fuels and energy. We can clearly see the positive impact on our on Page 15 with additional vessels trading in ammonia, stronger LPG demand pull during the winter months and continued ethylene exports.

These 3 elements positively impacted our utilization during the fourth quarter. And as has been mentioned before here, utilization has continued into the first 2 months of this year. Naturally, higher demand pull on the product side, combined with higher utilization, lends yourself to a solid base for rates to improve. Slide 16 shows the latest uptick across all gas carrier segments including the handysize semi-refrigerated, Handysize fully refrigerated and Handysize ethylene subsegments. Spot rates for oil charters take into account the supply and demand fundamentals at that specific point in time, area and cargo and can fluctuate quite a bit. The assessed time charter rates which this graph illustrates, are based on a 12-month duration. It reflects third-party opinion of what time charter rates should be today should a 12-month contract be executed at that point in time.

And we can confirm that time charters that are renewed are repriced at higher rates compared to what they were in 2022. We have traditionally had a 50-50 split on cover across the fleet. However, we have, at the beginning of this year, selectively reduced this ratio to about 40-60, increasing our spot market exposure. The rate environment, as in all ship sectors, are influenced by the availability of vessels. Our segment has a limited order book, as you can see on Slide 17, showing that out of the 122 vessels that are currently trading, 25 are above 20 years of age. The shipyards are occupied with LNG tankers and bulkers and therefore, timing for any new gas carrier supply is limited to 2026 onwards. The yard bottleneck providing us with a clear visibility of the vessel supply balance for the next 3 years which is a good thing.

I will now pass you on to Randall Giveans who will take you through some of the current company milestones. Over to you, Randy.

Randy Giveans: Thank you, Oeyvind. So following up on several announcements made in late 2022, we want to provide additional details on recent developments regarding 3 of those announcements. So starting on Slide 19. Our fleet renewal program is making significant progress as we are selling our oldest vessels and replacing them with modern second-hand tonnage. Starting with . On November 23, 2022, we sold our oldest test, Navigator Magellan, a 1998 built, 22,000 cbm LPG carrier from a third party for $12.7 million. We have these vessels with only 4 vessels built prior to 2008 or in the year 2000. And we continue to engage buyers for showing interest to acquire 4 vessels above 20 years of age. On the acquisition side, in September of 2022, Navigator Holdings announced that we entered into a joint venture agreement with Greater Bay Gas Company to acquire 5 ethylene-capable vessels.

Following this announcement, our new joint venture owned 60% by Navigator and 40% by Greater Bay Gas, has already taken delivery of 2 of 5 vessels thus far and the remaining 3 vessels are expected to be delivered in the coming weeks earlier than previously expected. As a reminder, the total cost will be $233 million and 65% will be financed by the $151 million bank from with 60% of the remaining costs, roughly $50 million payable from available cash. On Slide 20, we want to provide an update on our share repurchase program. In October of 2022, we announced the Board’s authorization for a share repurchase program of up to $50 million of NTTS common stock to be implemented on via open negotiated transactions or in accordance with an approved trading plan.

Now following the repayment of the bonds in December, we commenced the share buyback program. And through March 17, we have repurchased 2.02 million shares at an average price of $12.57 per share, totaling a little more than $25 million, leading roughly $25 million remaining on the initial authorization. To note, the year-to-date average daily trading value has increased to roughly 180,000 shares per day or $2.3 million with many days above 300,000 shares in recent weeks. Going forward, we expect to continue to repurchase shares as we believe the share price remains significantly undervalued relative to our net asset value and the current earnings backdrop. To note, the share price was $15 last June and $14 earlier this month and our outlook is more constructive and our base is stronger now than either of those types.

And given our aforementioned financial flexibility, we have the firepower to further repay debt, fund our group CapEx and continue repurchasing shares. Finishing on Slide 21 in our most recent announcement. A few weeks ago, we announced additional details for the expansion of our ethane export terminal under our existing 50-50 joint venture with Enterprise Products Partners at point. We have a reach to a capital project to increase the export capacity from approximately 1 million tonnes per year to at least 1.55 million tonnes and up to 3 million tonnes per year. The total capital contributions required from us to Joint Venture for this expansion are expected to be approximately $120 million to $130 million, commencing in the first quarter of ’23 and ending in the fourth quarter ’24 which the company expects to fund using a combination of cash on hand and additional debt financing.

Along these items have already been opened and construction is expected to be completed in the second half of 2024. Now as you can see in the bottom left chart, the terminal continues to run at or above a late capacity and current limited spot cargo availability is leading many new customers to discuss multiyear offset contracts. So we expect to contract the majority of the values for the expansion prior to project completion next year. Now I know several of you have questions about why we have large range for the capacity expansion. The aforementioned $120 million to $130 million will cover our full CapEx for this project, guaranteeing at least an additional 550,000 tonnes per year. Now there will be some additional favorable cost for the values above that but not much.

And the degree to which the expansion seeds 50,000 tonnes per year will fully depend on demand and price spreads. Now one important detail about the expansion is that it will triple our chilling capacity of ethylene at . As a reminder, the loading rate from the storage tank to our is roughly 100 tonnes per hours. However, the current bottleneck is the existing ethylene training curing week of 125 tonnes per hour. Now post expansion, the total chilling rate of ethylene will increase to 375 tonnes per hour providing substantial flexibility and optionality. Although we can’t go into the specific project details today, additional information regarding the engineering design and operations will be announced next week. So stay tuned that the expansion range will make a lot more sense then.

I’ll now turn it over to Mads for closing remarks.

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Q&A Session

Mads Peter Zacho: Thank you, Randy. And yes, we will go back — we’ll go to Q&A shortly thereafter but just allow me to say a few words. And the main conclusion at least for me now is that Navigator is in a good place right now. Our earnings haven’t quite reached the level we would want but the direction is clearly on an in built trend. The balance sheet is in its best shape ever with an appropriate level of net debt. And we’ve recently financed the loan portfolio giving us a long runway until the next maturities come in 2025. This gives us capacity for further growth and also redistributing capital through the ongoing share buyback which we’re halfway through. Commercially, the trend is good with high utilization of our fleet.

Terminal throughput is at full capacity and we see a good demand mix amongst our main transported commodities. We expect that Q1 ’23 will continue the recent improving trend and show an EBITDA that’s higher than any time before. Beyond Q1, we’ll continue to grow our company with the ethylene export terminal expansion. We’ll also continue to identify accretive investment projects to bend our portfolio. We are particularly excited about opportunities that we expect will materialize within transportation of green or blue ammonia as well as CO2, complementing our robust existing business with growth opportunities supporting the energy transition will take Navigator on a truly sustainable path. Thank you. And back to you, Randy.

Randy Giveans: Thank you, Mads. So with that, we’ll turn over to some Q&A. Operator, please allow the first caller.

Ben Nolan: Can you hear me? Am I on?

Randy Giveans: We can. How do you Ben? How are you?

Ben Nolan: I can’t hear you. All right. Well, I’ll ask my question and maybe it will — so — the first is it relates to the expansion. By my math, at the low end, it would add demand for at least probably half a dozen new ethylene-capable handysize vessels and at the high end, probably more than 20. The fleet is fully deployed. I think even although the 17,000 vessels are fully deployed across the industry. There’s really nothing on order. How are we going to move all of the ethylene once it’s ready to be produced next year?

Oeyvind Lindeman: So Ben, there is an interchangeability between ethane and ethylene. So I think there at least in the beginning will be a competition for moving ethane out of North America and ethylene, favoring the folks with ships that can transport either one, Navigator and others. So that is — there are enough ships today that can carry all that ethylene but that is the detrimental on the ethane side. So there will be — there’ll be a little bit puzzle between the 2. But that’s in the first instance.

Mads Peter Zacho: And I can say maybe, Ben, also from my side here that maybe we’re a little bit less worried about that. I mean we’ve seen rates for ethylene capable ships being relatively low, delivering a relatively modest return for all participants in the ethylene gas sector for a very, very long time. I mean, first of all, that needs to rectify itself so that the providers of that services are going to have a reasonable return on the shipping fleet. So there’s still a number of ships that are — that are capable of transporting ethylene that from time to time also transport some of the other commodities. And I think we’ll just see a little bit of, you could say, adjustments so that they will do what they were built to do which is transporting ethylene over time.

Randy Giveans: All right. We’ll take our next question.

Omar Nokta: Randy, it’s Omar. Am I coming through it okay?

Randy Giveans: Loud and clear, Omar.

Omar Nokta: Good. Good. Nice to see you yesterday. Yes, I just wanted to ask about a bit further on the terminal. And I guess you mentioned next week, we’ll get some more info on that. So I’ll look for that. But I just wanted to ask in terms of the offtake agreements you’re discussing with your customers, how are they looking relative? Or how are they — these discussions developing in terms of, say, duration? And I’m sure you won’t be able to comment too much, I guess, about the tariff but I guess in duration, how do those compare relative to what you have on your existing volumes?

Randy Giveans: Sure. On the new offtake bring it, it’s certainly a range where we have some portfolio players running shorter term, 1 or 2 years and certainly sound that one 5-plus years. So we expect to kind of contract that out with some range of maturities, right? So they’re starting in late ’24, some will roll ’25, ’26 and some will go until 2029 plus.

Omar Nokta: Okay. And then when you think about contracting that additional cost, so you have 1 million tonnes and you’re going to get it up to 550 million with the planned CapEx spend. Is — is it — are you expecting to be able to contract — you mentioned being able to contract all the volumes before the end of the construction period, would that be for the 550 million? Or is that for the full build-out, including the additional 1 million?

Randy Giveans: Yes. I think it’s a majority price. So we’ll have at least 1.55 million tonnes of capacity. I know our partner and I spoke, would like to see at least 80%, to make 90% of that contracted, obviously, making some upside for spot cargoes which we have the expansion anyway. But I would expect that 90% number for the full 1.55 million to kind of be the goal for contracts.

Omar Nokta: Okay. And then just wanted to follow up separately. Final question. Just kind of on the shipping market itself, you guys gave a pretty good update and clearly, there’s been a big bounce back in the Handysize shipping segment here. And definitely, in the fourth quarter relative to the third, we’re seeing longer distances for the U.S. exports towards Asia versus Europe like it was in the third. Just wanted to ask, how are you seeing things developing now? I know you gave some color in your opening comments. I just wanted to see how are those distances going currently? And then is there any risk or anything that you see in the horizon that would shift those back towards more shorter haul trades into the European market?

Oeyvind Lindeman: If this is specifically linked to ethylene, we’re booking ethylene ship freight from the U.S. for April and May already. And the indications are that it will continue to go to Asia which is great. Some is going to Europe because there’s a big arbitrage to Europe as well. So it’s a little bit of who can pay the most in the ethylene freight game. But definitely, the trend continues to go to include Asia Pacific destinations.

Omar Nokta: Great. All right. Well, thank you. I appreciate the color and looking forward to next quarter, it sounds like it’s going to be a record figure.

Randy Giveans: Thanks, Omar. Any other questions? Okay, everyone on the line on our or then maybe to you, can you give an update for where TCE rates are now and maybe your expectation for the rest of 2023?

Oeyvind Lindeman: On the — we had some color commentary in the prepared remarks. On time charter rates, the renewals we are doing at the moment or in 2023 has been repriced at or above the assessment that we are showing. So that is clearly an improvement from where we have been over the last 2, 3, 4 years; so that is great to see. On the spot side, we are reducing — or we’re increasing our spot exposure because we think the fundamentals are there, justifying that slight adjustment. So the spot rates depends very much, as I mentioned, the time, the area and the cargo. So that has a bigger variation volatility than the time charter rates. But in combination, if you combine it all, it is better than what we’ve seen for a long time.

Randy Giveans: Excellent. And then last question for Niall. After this quarter, share repurchases, what is the diluted outstanding share?

Niall Nolan: The quarter, as you mentioned in your remarks, Randy, the quarter — or the share repurchase scheme only started mid-December. So the number of shares bought in December was not a whole lot less than 0.5 million shares. We have — up to date, we have about 2 million shares purchased. So it’s 2 million less than that, given that just towards the beginning of the year, so around 75 million.

Oeyvind Lindeman: And that’s, of course, with any potential completion of the program will take another if it was the same average price, of course, it would be another 2 million. So you need to add that in because the idea is that we have the full $50 million. And so far, we are heading in that direction.

Randy Giveans: Well, thanks. That is it for the Q&A. Thank you again for all of those who joined us. We will be back likely in mid-May for our 1Q ’23 results. So looking forward to seeing you then and feel free to reach out with any questions. Have a great day.