World Kinect Corporation (NYSE:WKC) Q3 2023 Earnings Call Transcript

World Kinect Corporation (NYSE:WKC) Q3 2023 Earnings Call Transcript October 28, 2023

Operator: Thank you for standing by, and welcome to the World Kinect Corporation Third Quarter 2023 Earnings Conference Call. At this time all participants are in listen-only mode. After the speaker presentation, there will be a question-and-answer session. [Operator Instructions]. I would now like to hand the call over to the Vice President of Investor Relations, Elsa Ballard. Please go ahead.

Elsa Ballard: Good evening, everyone, and welcome to the World Kinect’s third quarter 2023 earnings conference call, which will be presented alongside our live slide presentation. Today’s presentation is also available via webcast on our Investor Relations website. I’m Elsa Ballard, the VP of Investor Relations. With me on the call today is Michael Kasbar, Chairman and Chief Executive Officer and Ira Birns, Executive Vice President and Chief Financial Officer. Before we get started, I would like to review our Safe Harbor statement. Certain statements made today, including comments about our expectations regarding future plans and performance are forward-looking statements that are subject to a range of uncertainties and risk that could cause actual results to materially differ.

Factors that could cause results to materially differ could be found in our most recent Form 10-K and other reports filed with the Securities and Exchange Commission. World Kinect assumes no obligation to revise or publicly release the results of any revisions to these forward-looking statements in light of new information or future events. This presentation also includes certain non-GAAP financial measures. A reconciliation of these non-GAAP financial measures to their most directly comparable GAAP financial measure is included in our press release and can be found on our website. We will begin with several minutes of prepared remarks, which will then be followed by a Q&A period. At this time, I would like to introduce our Chairman and Chief Executive Officer, Michael Kasbar.

Michael Kasbar: Thank you, Elsa, and good afternoon everyone. I’ve been spending a great deal of time over the last few months at industry conferences, and the offices of our customers around the world and engaging with our employees. It is clear to me that now more than ever, the demand for World Kinect service is as strong as it’s ever been. Our broad base of customers and supply partners are grappling with an industry influx from changing sustainability requirements and expectations, to an increasingly prescriptive and disjointed regulatory environment. For nearly 40 years we have been providing energy solutions, creating value for both suppliers and customers, and I don’t believe I have ever experienced a more complicated operating environment for our industry than now.

Despite this, we continue to execute on our mission to meet our customers’ energy needs safely, reliably and in the most efficient manner possible. The third quarter demonstrated our ability to exercise financial discipline in managing within a higher interest rate and inflationary environment. We continued to leverage our global operating platform as we saw the near full return of aviation demand, while heightening our focus on working capital management. Our marine business delivered solid returns despite experiencing some weakness in a few physical locations and a less constrained credit environment. And our land business began to see our investments in sustainability bear fruit during the quarter. We expect a further stream of activity as we continue to build out our global capabilities.

Last quarter I shared with you our three pillar focus to accelerate growth and diversify earnings by maximizing efficiencies in our conventional businesses, expanding our suite of energy management solutions and increasing the availability of renewable energy and low-carbon fuels. This strategy is exactly aligned to where our customer’s current needs are and where their future needs will be. We will do this while optimizing our network of thousands of airports, seaports, cardlocks, retail stations and distribution assets. In marine and aviation, we have built a highly competent and efficient global platform with dedicated professionals and established processes. We are replicating this in our land business and expect it to be a material part of meeting our medium-term 30% operating margin target.

Simultaneously, we are sharpening our portfolio, exiting non-core and low-return businesses and reallocating capital for better returns. This is recently evidenced by our addition of 20 cardlocks in the Midwest to further expand our U.S. land business. And we continue to look for further accretive opportunities to grow our land and global sustainability businesses organically and inorganically. Speaking of sustainability, that business produced an excellent result this quarter, and we continued to expect great things from our team. Sustainability knows no borders or segments. And so we are hyper-focused on bringing these solutions to customers across all of our businesses and continuing to evolve our offerings to meet the current and future needs of the marketplace.

Finally, we continue to embrace automation, and I believe the recent advances in AI will be a game changer. We are already leveraging many of these tools and have been for a long time. We believe AI will improve our efficiency, cost management and ability to drive top line growth, creating greater market value for us while improving the lives of our employees. Before I wrap up, I’d like to announce that we will be hosting an Investor Day in March of next year to discuss our corporate strategy in more detail. We’ll be sharing more information and a registration link shortly. I’ll now turn over the call to Ira for a financial and business review of the quarter.

Ira Birns : Thank you, Mr. Kasbar. And good evening, everyone. For starters, please note that results for the third quarter reflect no adjustments to GAAP results. However, the comparative prior-year numbers do exclude the impact of certain nonoperational items, which are highlighted in our earnings release. Reconciliations are as always on our Investor Relations website, and they’re also in the webcast presentation. Now let’s continue with the financial highlights. On a consolidated basis, total volume was 4.54 billion gallons, which was down slightly and consolidated gross profit declined 13% from last year’s third quarter, primarily due to lower gross profit in our marine segment, which benefited significantly from record prices and volatility in the prior year.

This was partially offset by increased gross profit in our land segment, and I’ll now provide some more detail segment by segment. Aviation volumes increased to 1.92 billion gallons in the quarter, up 4% year-over-year due to another robust summer passenger travel season. However, year-over-year gross profit was down slightly to $126 million in the quarter. We have been successful at achieving higher margins on recent commercial contract renewals considering the current interest rate environment. However, overall gross profit improvement was muted by both the reduction in inventory-related profitability as a result of significant fuel price volatility during the quarter as well as our efforts to rationalize low return business activity. The net result of our strategy has increased returns and enabled us to reduce aviation net working capital nearly $200 million year-over-year, contributing to our reduction in interest expense.

As we look to the fourth quarter, while we expect the seasonal decline in aviation gross profit, this projected decrease could be mitigated if commercial passenger activity remains strong through the holiday season. Turning to our land segment. Volumes were 1.55 billion. That’s up 2% year-over-year, principally due to an increase in natural gas and power volume, offset in part by lower volume in our commercial and industrial and retail business activities in North America. Similar to the second quarter, approximately 1/3 of total reported land volume relates to our natural gas and power activities converted into gallon equivalents. From a profitability standpoint, land generated $121.2 million of gross profit in the third quarter. That’s up approximately 3% year-over-year.

We saw an increase in profitability from our sustainability-related service offerings, continuing the positive trends for this business that we have noted on prior calls. Specifically, we experienced strong growth in our renewable energy solutions business and continued strength in our power business in Europe. Looking to the fourth quarter, we expect a modest year-over-year decline in gross profit, considering the current pricing environment and market conditions. And lastly, our marine segment volume of 4.1 million metric tons was down 16% from the third quarter of last year. Third quarter results were lower than anticipated leading into the quarter, principally related to weakness in a few physical locations. More broadly, we experienced some modest margin pressure, but overall business activity was stable.

Decreased volumes and lower average fuel prices led to a marine gross profit of $35 million, which is down 54% from the prior year when bunker prices and market volatility were at record or near-record highs. While gross profit is down from last year’s record levels, marine working capital efficiencies remain exceptional with no real net working capital investment regardless of the market price environment. For the fourth quarter, we expect a modest sequential increase in gross profit. And while marine margins should remain well ahead of historical averages, we expect marine gross profit to be down year-over-year. Again, this is due to the comparison to the fourth quarter of ‘22 when bunker prices and market volatility were considerably higher.

Our total consolidated operating expenses were $208 million in the third quarter, below the guidance range provided last quarter and down 6% from last year’s third quarter. Looking ahead to the fourth quarter, we expect consolidated operating expenses will be in the range of $205 million to $208 million, representing a modest sequential decline. For the full year, operating expenses should be generally flat year-over-year after several years of year-over-year increases, excluding the ‘20 and ‘21 COVID years. This is a testament to our heightened efforts in managing expenses in the face of inflationary economic environment, and we remain focused on making significant progress towards our 30% operating margin target over the course of 2024.

In terms of working capital, I already mentioned our focus on working capital at the segment level, but our team has done a great job driving record efficiencies in this area across the business. Considering the current interest rate environment, we have talked about improving margins, but at the same time we have also significantly increased our working capital efficiencies, which has driven our consolidated net trade cycle to a record low. This obviously has contributed to strong cash flow generation, which has also enabled us to further reduce interest expense. Speaking of interest, all these efforts allowed us to reduce interest expense, which came in within our guidance range for the quarter at $29 million, that’s down 12% sequentially and 16% year-over-year.

So as we look ahead to the fourth quarter, we expect interest expense to be relatively flat sequentially, but again should be down significantly year-over-year. Our adjusted effective tax rate for the third quarter was 23%, somewhat higher than our 21% rate for the first half of the year. For the fourth quarter, we expect our tax rate to be generally consistent with the third quarter, resulting in a full year tax rate of approximately 22% to 23%. In terms of cash flow, we have continued our strong performance this year, adding an additional $80 million of operating cash flow this quarter, bringing year-to-date operating cash flow to $267 million. And our average annual operating cash flow over the past five years has now been nearly $300 million, fueling our ability to employ our flexible capital allocation framework.

Our guiding principles for capital allocation priorities remain consistent, supporting the growth of our business both organically and through strategic investments, while also returning capital to our shareholders through buybacks and dividends, which have totaled $76 million year-to-date, all with an eye on delivering increased shareholder value. So in summary, we delivered solid results in the third quarter with another $100 million plus quarterly EBITDA contribution. Our emerging sustainability business continues to be a strong contributor in our land segment. While our marine profitability clearly declined from the record highs of 2022, our team continues to manage this business very efficiently. Our broader focus on working capital across the business has contributed to strong year-to-date operating cash flow of $267 million, while also mitigating interest expense in this higher interest rate environment.

And we remain intently focused on driving profitable growth and carefully managing expenses to ensure we drive even strong results as we look towards 2024 and beyond. That’s it for me. I’d now like to turn the call back over to our operator to open the call to Q&A. Thank you.

Operator: Thank you, sir. [Operator Instructions] Our first question comes from the line of Pavel Molchanov of Raymond James.

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Q&A Session

Pavel Molchanov: Thanks for taking the question. Let me start with aviation. Since the start of the crisis in the Middle East three weeks ago, we’ve seen a lot of disrupted airline activity in the region. Can you talk about your exposure to that regional market? And is there any effect on the business outside of the aviation segment?

Michael Kasbar: Thanks Pavel. Our business is global as you know, and the impact has been very, very modest from our demand within that region. So that’s not a major operating location. As you know, we’re doing business worldwide. But the impact on our aviation activity has been de minimis, and then the other impacts in terms of the marketplace have also been de minimis. As horrific and tragic that incident and the whole scenario there is, it’s been contained — and that’s obviously represented in terms of the market’s reaction to it. So no meaningful impact to the business.

Pavel Molchanov: Okay. Good to hear. Same question I asked three months ago and you’ve been kind enough to share this number in the past. What percentage of net revenue or EBITDA is at this point coming from low carbon and renewables?

Ira Birns: Pavel, thanks for the question, which you asked last quarter, consistent with the answer last quarter, the way we pull those pieces together. I think I told you in the last quarter that it was approximately 10% of GP and 10% of EBITDA. That includes our power and gas activities and sustainability-related solutions. I would say this quarter that number has actually gone up slightly. It’s a little over – both of those numbers are a little over 11%. So up about 1%, 1.5% from last quarter.

Pavel Molchanov: Okay. And then lastly, on the marine segment. So obviously, a lot of international trade headwinds, just given the macro. Is there any evidence at your disposal that marine volumes are stabilizing?

Michael Kasbar: Well, in terms of the market, the macro is certainly softer. Slow steaming is not an immaterial dimension to it, both for economic reasons, as well as emissions management. The overall impact of that I think is low single digit. So it’s certainly not robust, and that’s had a modest impact on the segment. I think Ira may have some additional color to add to that.

Ira Birns: Yes. In addition to what Mike had to say, if you focus on us specifically, similar to our comments recently in Aviation, one of the things we’ve done in Marine over the last couple of years is rationalize some lower-margin business that historically we may have been doing for the sake of volume. So we – our volume numbers year-over-year are impacted by both a bit more of that as well as the impact of the market itself. I would say your question was, is it stable? I would say we’re at a level now that is stable with possibly some opportunities to pick up some additional volume next quarter. I don’t see it dropping materially more from the level that we found ourselves at in Q3.

Pavel Molchanov: All right, thank you very much.

Ira Birns: Thank you, Pavel.

A – Michael Kasbar: Thanks, Pavel.

Operator: Our next question comes from the line of Ken Hoexter of Bank of America.

Kenneth Hoexter: Hey, great. Good afternoon. Hey Ira, Michael, Elsa.

Michael Kasbar: Hi Hoexter. How are you?

Kenneth Hoexter: Good, good. So Ben, you’ll get in a minute, hang on. Marine, you noted a few locations were impacted. Is that all up and running now? Was that port strikes out West in Canada? Was it freight diversion because of the negotiations? Can you talk about what was going on in the marine side and if it’s resolved?

Michael Kasbar: It is all generally resolved, three particular locations, three different stories. One of them had a disruption – two of them had some short-term disruptions and one of them had some other issues during the quarter. But I would say that, that is – 95% of that is now behind us, and we don’t expect to get impacted from any of those issues in a material way in the fourth quarter.

Kenneth Hoexter: Okay. What was that something on – at the site that stopped you from – I just have no idea what you’d say. If it wasn’t the port strike stopping vessels, was it something at locations that disabled you from…

Michael Kasbar: It was something at two specific locations in Europe in 1 location in the U.S. that hampered volume during the quarter.

Kenneth Hoexter: Okay. So Ira, we’ve talked a lot over many years. Is this about, right now, as to Pavel’s question about the inflection, is this about winning share with existing customers or is this the competitive market out there? Has it changed at all? Obviously you’ve been aggregating a lot of business over the years, competitors or people providing service at the docs or at airports. Is this a competitive business still that you’re seeing increasing consolidation or is this just, we’ve got to wait for the market and then our customers take more volumes?

Ira Birns: I mean, it’s a little bit of both. Obviously market conditions, the container market as I’m sure you know is not – certainly not at the strongest level right now. So part of it is us having a disciplined approach to returns. So again, we’re not after growing volume for the sake of growing volume, we’re trying to grow profitability and related returns. And again, Marine is highly susceptible to the pricing environment as evidenced by the phenomenal results last year when bunker prices hit record levels. So it’s a little bit of both. Our guys are always after additional business with existing customers, new business with new customers, but they have to hit the hurdle rates that we ascribed to them in order for that to make sense to all of us.

And those hurdle rates have increased in this interest rate environment, right, which again, has resulted in us walking away from some business that maybe we might have entertained 18 months ago. So it’s a combination of both of those factors that you described.

Michael Kasbar: And then just to put a bit more on it, Ken. In my comments I talked about the efficiency of our platforms, and I think we’re feeling more confident in our ability to create efficiencies in our operations to be able to make us more competitive, and that achieves the ability to obtaining the returns as well as gaining market share. And as our network expands, and it has expanded greatly certainly in aviation, and as we open up new locations in marine, that creates greater opportunities. And our land business, I think, has got significant upside as well as sustainability. So those were the comments that I referred to earlier. So when we talk about growth, it’s growth with a return – and that’s where we see the future in terms of grabbing density, sharpening the portfolio, being able to get operating leverage, in those areas and managing the portfolio to achieve those outcomes of growth with a reasonable return.

Kenneth Hoexter: Ira, I want to ask you a financial question, you know thoughts on cash flow. It used to be that when oil prices went up, you were extending credit to your customers. When it was low, you’d actually swim in the cash flow as you didn’t need to extend day sales outstanding and your credit. It sounds like you’re seeing improving cash flows despite what we’ve seen a run-up in fuel. Maybe just talk about the backdrop there for a second, and I’ll blend it in with two questions, right? So the thought on cash flow and then your 30% margin target, what do you need to happen to get there? And maybe talk about… [Multiple Speakers]

Ira Birns: Okay, so the cash flow first. We don’t often pat ourselves on the back, but in terms of the working capital story, our team should. And part of that, look – and its – for the first time in many, many years we all know we’re in a 7%, 8% funding environment versus one to two for many, many years, right. So our team has been – I mentioned returns. Mike mentioned returns already. Part of focusing on returns is trying to get some more margin, which isn’t that easy. We were very successful at that in aviation this summer, but that doesn’t completely mitigate the sharp rise in interest rates and the related increase in interest expense. So we’re also focused on where we do business, who we do business with and how we go-to-market in terms of customer terms and this compared to our terms on the supply side, how we drive more efficiencies and how much inventory we carry every day.

So a great point that you raised, despite the fact that prices are relatively high by bringing our trade cycle down. I mean, our trade cycle this quarter was less than two days. Over the long run, it’s been in the very high single digits, right? So by doing that, we’re able to generate a healthy amount of cash despite a pricing environment, which increased for most of the third quarter. And your next question will be, could you maintain that? So I’ll answer that question in advance. We’re trying really hard to maintain that in terms of the mix of business we have and the revision we have in terms of driving returns. Every salesperson has a hurdle rate that they have to hit when they are going to market, and they are going to achieve that by using a couple of levers.

One of them is margin, the other one is working capital. And we’ve done that very well. Aviation has improved most significantly. I mentioned $200 million reduction in their working capital year-over-year. Marine has been excelling at that for a long time. In marine, we’re generally match-funded, meaning we don’t really have much inventory and our receivable and payable days balance out almost perfectly even. So there’s no real working capital in marine. Land still has a lot of different pieces to the puzzle. But even there we’re seeing some improvement. So that’s put us in a better position to giving us a better shot to drive improved cash flow performance, even in a higher price environment. In terms of the operating margin target, we – I mentioned maybe it’s not the greatest thing to brag about that our expenses should be flat year-over-year, but we haven’t done that in many, many years, so it’s a start.

We’re focusing on every single line item on the P&L. I could probably go on, on this one for a half hour, because I’m passionate about it, but really looking at optimizing, reducing unnecessary costs in many G&A categories. For example, we’ve already seen some successes there. We have one of our best finance people that we’ve moved into our IT function to focus on every dollar we spend in a function that spends a lot of money, right, to be more effective there. And my finance team is focusing on being more effective. Our HR team is focusing on driving efficiencies as well. Part of how we get there is also land finally catching up to aviation and marine in terms of their operating efficiencies, where we’re still a bit behind. But post Flyers acquisition, we’re getting closer and closer to a fully integrated organization in North America, and that should also contribute over the next 12, 18 months to improve operating efficiencies.

So that’s a big accomplishment for us. So we didn’t make that much progress this year, but we think we’ll make more significant progress next year and then into ‘25 on that one.

Kenneth Hoexter: I want to hand it off to Ben, because he’s been patiently waiting, but I presume that the last thing there means you smoothed out some of that seasonality that you used to have to talk about with Europe in first quarter, fourth quarter or is that still there a little bit with the…

Ira Birns: Well, I was really – I was looking at our annual run rates when I was thinking about that. But we have smoothed that out a bit more, because land now has stronger quarters from Flyers generally in the quarters that were softest for us before. And at the end of the day, that U.K. weather-dependent business – by the way, it’s the beginning of October and everyone’s wearing shorts in the U.K. So starting out to be weaker than you would hope, but the weather may change, but that’s become a much smaller piece of the pie, and we’ve smoothed it out with considerably more volume and profitability in the second and third quarters post Flyers acquisition. So yes, there’s less of that as well.

Kenneth Hoexter: Thanks Ira, thanks Michael. Thanks Elsa.

Michael Kasbar: Thanks Ken.

Operator: Thank you. [Operator Instructions] Our next question comes from the line of Ben Nolan of Stifel.

Ben Nolan: Thanks and let me just start by saying thanks to Ken for sticking to two questions. I appreciate that, so. I do have a few though. The first is – well, first of all, just to clarify on what Ken was asking with respect to working capital. So at least aspirationally if – as we look into the fourth quarter, if fuel prices remain relatively constant, there shouldn’t be any give back with respect to that working capital, correct? It should just effectively be what your cash flow from operations would be, net working capital. Is that fair?

Ira Birns: Yes. I mean, yes, at the end of the day, we’re doing everything we can to generate cash again in the fourth quarter. Obviously, that’s somewhat dependent on what may happen to price in November and December. If hypothetically prices went through the roof, that makes that a little more difficult despite what I just said. But if prices are in this relative ZIP code, they’ve been relatively calm and constant over the last few weeks, if it stays, the water stay calm, we should be able to deliver some additional cash flow in the fourth quarter.

Ben Nolan: Okay. So I wanted to also ask, I mean you have this strategic evolution in trying to focus on and have been building up some of these areas that are a little bit further or adjacent to at least some of the traditional things that you’ve been doing. I’m curious if there – as you look at that portfolio, are there holes in it or are there areas that are going to need capital as you look forward, or do you feel like you can grow in that footprint and accomplish what you want to accomplish with a capital-light effort?

Michael Kasbar: Good question, Ben, and it depends. So it’s a mix, a business mix of a number of different things. So it’s – on power and gas, we’re providing advisory brokerage, some merchant activity, some balancing activity there, some risk management, so that runs the full spectrum. And then on the carbon side and the renewable energy services side, it would be power agreements, it would be environmental certificates, it would be on-site solar advisory. So a number of those are very balance sheet friendly and have eminent scalability. Their intellectual capital activities, it’s a beautiful thing because everyone needs to do something more or less with their sustainability initiatives and a lot of them don’t necessarily have a plan.

It’s rather complicated. So we’re able to help them navigate that, both with the advisory, the knowledge base, give them a plan, do an assessment and also carry out the implementation. So some of those activities certainly are using some balance sheet capabilities. We’re quite adept at understanding how to manage that and work within the borders of our balance sheet, and we’ve done that reasonably well. So it just depends on what part of that sustainability business activity we have. So certainly, the merchant side and gas and power work differently. But our participation model in those is pretty robust, and we’re judicious in terms of how we participate in the merchant side of that. But we certainly understand it and the capability of understanding those molecules and electrons, we’ve got deep domain expertise.

So it’s step-by-step, but there’s many parts of the area that are not tapping the balance sheet.

Ben Nolan: Okay, I appreciate that Mike. And then lastly for me, I was a little bit surprised or I was curious if maybe you could talk me through how you’re thinking about share repurchases. I mean the shares have been somewhat soft, although the results here are reasonably good, maybe not record-setting, but not bad, and it doesn’t seem like that’s being reflected very well in the shares. And then as a consequence of that also in the convertible price, as well as is another alternative. It seems to me as though that is much lower-hanging fruit in terms of capital deployment than making investments outside the firm or acquisitions. Can you maybe talk me through how you think about that and sort of where you sit with respect to the deployment of capital between buybacks and other things?

Ira Birns: Always a fun question to answer for you, Ben. So we always carefully evaluate, say the optimal timing for any share repurchase, the optimal amount of purchases as part of our overall capital allocation framework, right. As you’ll remember, we recently repurchased over 2.2 million shares or $50 million worth of stock just in June when we issued our convert. But look, additional buybacks are always a consideration, alongside our capital allocation decisions going towards organic growth, inorganic opportunities, albeit a great point that the multiples on those are a lot higher right now, as well as dividends, right? So all I can say is this, it’s always a consideration. We don’t necessarily choose a fixed dollar amount at the beginning of the year.

It depends on the world around us and where we see opportunities in either the stock or other opportunities outside the business that may be a bit more expensive on a pure kind of economic analysis, but could drive strategic value to us over the long term. So we have to always provide available liquidity and financial flexibility for those types of investments as well. So at the end of the day, we’re trying to allocate effectively between all those levers to drive the best possible shareholder outcome, but while also maintaining the appropriate level of financial flexibility. So that’s probably the best answer I can give you on that one.

Ben Nolan: If you had to – I’m going to press on that for a second. If you had to sort of look at where we are right now today at today’s share price and then also sort of where relative valuations are for some of the potential targets that are out in the market, how does it stack up based on this moment, would you say?

Ira Birns: On a relative basis, of course, am I supposed to say this. Is there a counsel in the room? Our multiples are ridiculously low, as you would say. The stock opportunity is really cheap, but that’s a key factor, but that isn’t everything, right, when you’re comparing where you’re going to invest your next dollar, right. So short now on a relative basis to different periods in our history, it certainly is more attractive than it was. That doesn’t mean that that translates into every available dollar of cash should go to buying back shares, right. We still have to consider other opportunities as part of our – again, as part of our strategic initiatives, trying to drive further growth and scale. If Pavel is still listening in, in our sustainability-related businesses, there’s a lot of synergistic opportunities in land.

Mike alluded to a small one that we completed recently in North America. That’s a really simple bolt-on to the cardlock business, where they would say at the end of the day, we’re – that’s a pretty solid investment right now considering it comes with literally no cost and only income, because it’s such an easy integration. So yes, on average, it is a better time today than it may have been at other periods in the past. And you’d argue its being more seriously considered, but its being more seriously considered alongside other opportunities as well.

Ben Nolan: Okay. Ira, well I’ll leave it there. I appreciate it. Thank you.

Operator: Thank you. I would now like to turn the conference back to Michael Kasbar for closing remarks. Sir.

Michael Kasbar: I like to thank our investors for your support, as always. And I’d also like to thank our over 5,000 World Kinect teammates. The outstanding work that you do every day is what makes us who we are. So thank you very much, and look forward to talking to everyone next quarter. Take care. Bye-bye for now.

Operator: This concludes today’s conference call. Thank you for participating. You may now disconnect.