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FacSet Research Systems Inc. (NYSE:FDS)

Q1 2012 Earnings Call

December 13, 2011 11:00 AM ET

Executives

Rachel Stern - SVP, Strategic Resources and General Counsel

Peter Walsh - COO

Mike Frankenfield - Global Direct of Sales

Phil Hadley - Chairman and CEO

Analysts

Peter Appert - Piper Jaffray

Peter Heckmann - Avondale Partners

Shlomo Rosenbaum - Stifel, Nicolaus

Dave Lewis - JPMorgan Chase

John Neff - Akre Capital Management

Robert Riggs - William Blair

Operator

Welcome, and thank you for standing by. (Operator Instructions) I would like to introduce your host for today’s call, Rachel Stern, Senior Vice President, Strategic Resources and General Counsel. You may begin.

Rachel Stern

Thank you, operator. Good morning, and thanks to all of you for participating today. Welcome to FactSet’s First Quarter 2012 Earnings Conference Call. Joining me today are Phil Hadley, Chairman and CEO; Peter Walsh, Chief Operating Officer; and Mike Frankenfield, Global Director of Sales.

This conference is being transcribed in real-time by FactSet’s CallStreet service and is being broadcast live via the internet at factset.com. A replay of this call will also be available on our website.

Our call will contain forward-looking statements reflecting management’s current expectations based on currently available information. Actual results may differ materially. More information about factors that could affect FactSet’s business and financial results can be found in FactSet’s filings with the SEC.

In an effort to provide additional information, our comments include non-GAAP financial measures. The non-GAAP measures we will discuss today have been reconciled to the related GAAP measures in our earnings press release and our SEC filings. Annual Subscription Value or ASV is a key metric for FactSet. Please recall that ASV is a snapshot view of client subscriptions and represents our forward-looking revenues for the next 12 months. Lastly, FactSet undertakes no obligation to update publicly any forward-looking statements as a result of new information's, future events or otherwise.

I’d like to turn the discussion over now to Peter Walsh, Chief Operating Officer.

Peter Walsh

Thank you, Rachel, and good morning, everyone. Here’s how I plan to spend our time today. First, we’ll talk about two housekeeping items. Second, we’ll review our first quarter results. Third, I’ll provide guidance for the second quarter. Finally, we’ll end with Q&A.

For housekeeping, please note we expect the US federal R&D tax credit to expire on December 31, 2011. While the R&D tax credit has been in place for 30 years, accounting rules mandate that it can’t be factored into your effective tax rate unless it’s part of currently enacted tax laws. Accordingly, EPS and non-GAAP EPS include a $0.02 reduction for both Q1 and future quarters.

In addition, to be more consistent with information provided by other public companies, we added to our regular quarterly process by defining and breaking out non-GAAP EPS. While investors could manually assemble the same information, we wanted to make it easier and more straightforward because we believe the information is relevant when valuing companies.

Before we dive into details of the first quarter, it’s valuable to cover current market conditions and why FactSet can be very successful in the near term. Volatility in the financial markets did interrupt short-term buying patterns from our clients dampening our ASV growth this quarter. Sell side clients were quick to react as they always do, tightening up user deployment. Our share in buy side clients did expand and was in line with previous quarters. Our Q2 guidance implies more ASV growth is ahead.

Our clients are well organized and efficient at managing their vendor spend, much better than a few years ago. This is a positive for three reasons. One, clients’ unexamined spending is at an all-time low. Clients’ worked out inefficiencies in ‘08 and ‘09 and have not overspent since then.

Two, improved management and more careful spending means clients can be quicker to react in both directions, adding services more quickly when the market conditions are less volatile.

Three, we often benefit in periods of consolidation. FactSet is tiny to the market leaders in our industry. We offer clients cost savings relative to these leaders and the best product line among them to manage portfolios and risk. Simply put, we do not have to rely on a growing market to prosper.

Now let’s turn to our first quarter results. ASV was $782 million at November 30th, 2011, up 12.5% year-over-year. ASV advanced 3.5 million during the first quarter. We exceeded quarterly EPS guidance after factoring out the expiration of the R&D tax credit.

Free cash flow, which is defined as cash generated from operations less capital spending, was 49 million during the first quarter, more than triple the same period last year. Higher levels of net income and client payments contributed to free cash flow. Over the last 12 months, our free cash flow grew 14%. Free cash flow was also 21% higher than net income, which we believe illustrates the high quality of our earnings.

Accounts receivable declined by 10 million compared to the end of the fourth quarter. Our DSOs were an industry leading and record low 30 days at quarter end compared to 33 days a year ago.

As of November 30, our cash and investment balance was 208 million, up 26 million from Q4 2011. During the first quarter, CapEx expenditures were 6 million, and 15 million was spent on share repurchases. At quarter end, 128 million remains authorized for future share repurchases. During the first quarter, we paid a regular quarterly dividend of $0.27 per share for a total of 12 million. Aggregating dividends with share repurchases, we returned 251 million to shareholders over the past 12 months.

Let’s now turn to the P&L. FactSet’s revenues rose 13% compared to the year-ago quarter to 196 million. Operating income for the first quarter rose to 67 million. Net income grew to 46 million compared to 42 million in the same quarter last year. Non-GAAP net income rose to 51 million, up 15% compared to the year-ago period, and non-GAAP EPS rose 18% to $1.10.

Our US operations accounted for 533 million of ASV. International operations were responsible for 249 million in ASV or 32% of the total. US revenues grew in Q1 to 134 million, up 14%, from the same quarter a year ago. Non US revenues rose 13% to 60 million. Revenues from Europe and the Asia Pacific regions in Q1 were 48 million and 14 million respectively, with growth rates in each region of 11 and 17% respectively year-over-year.

Let’s look at some of the factors behind our performance this quarter. We continue to experience strong growth in ASV from our portfolio analytics suite of products. ASV from this products suite during the last three months was higher than Q1 last year. We’ve seen a nice increase in the number of PA Workstations and strong demand for SPAR and our portfolio publishing product line.

FactSet’s proprietary content has been a solid contributor to our total ASV. Our content technical solutions team continues to work hard and has been successful in licensing our own databases and in particular FactSet fundamental and FactSet estimates. We’ve invested aggressively in FactSet fundamental and FactSet estimates and now have leading databases that are relevant to a large user community. The improved market position is also important, because they like all FactSet content, is available in feed form to large clients and third parties for redistribution.

Our user count declined to 46,900 at the end of Q1, a decrease of 1,200 users. This reduction was related to large sell-side firms. A few other key performance metrics are relevant. Our client count increased to a total of 2,271 up 34 net new clients in Q1. This increase is more than the 13 clients we added in the first quarter of last year and is a lesser of the opportunity to sell into more buy side firms.

Consistent with last year annual client retention was greater than 95% of ASV. In terms of the number of clients our retention rate rose to 92% versus 90% a year ago. These statistics tell us that our recent and substantial product investments are paying off and increasing engagement level among clients.

Let’s take a look at the expense side now. Operating expenses for the quarter were 130 million, up 14% from the same quarter a year ago. Operating margins were 34% compared to 33.6% in Q4 of fiscal 2011 and 34.3% in Q1 last year.

Costs of services as a percentage of revenues increased 155 basis points over last year. This increase was the result of higher compensation expense associated with new hires and an uptick in variable data costs from growing the client base, partially offset by the full depreciation of older generation of VMS mainframe machines.

SG&A expense as a percentage of revenues decreased 65 basis points compared to the same period last year, due to lower inter-office travel and a reduction in our advertising costs in the current quarter, partially offset by higher office costs from a growing employee base. This quarter our head count rose modestly by 199 employees to 5,450 at quarter end with the large majority of new employees allocated to our constant operations.

The effective tax rate for Q1 was 32.1%, as compared to 30.1% a year ago. The expiration of the R&D tax credit increased the annual and first quarter effective tax rate by 1.3%.

Now let’s turn to our guidance for the second quarter of fiscal 2012. Revenues are expected to range between 197 million and 200 million which represents year-over-year growth of 11and 13% at each end of the range. Operating margins are expected to range between 33.7% and 34.2%. GAAP diluted EPS should range between $0.99 and $1.01. Non-GAAP diluted EPS should range between $1.10 and $1.12, which represents year-over-year growth of 12% and 14% at each end of the range. Both GAAP diluted EPS and non-GAAP diluted EPS include a $0.02 reduction to reflect the expiration of the US Federal R&D credit on December 31st.

To sum it up, we’re not completely immune to volatility in the global finance markets. Few are these days. Nevertheless, our business model is built to operate successfully in all market conditions. We’ve been investing aggressively in our product. Our ASV metrics provide us the necessary visibility to manage our expense base. We generate far more cash than we need and our balance sheet is very healthy. Most importantly, we believe that our forward opportunity is more than 10 times our current size. FactSet doesn’t require a growing market to be successful, and our employees remain focused on increasing our market share.

Thank you for your participation in today’s call. We are now ready for your questions.

Question-and-Answer Session

Operator

(Operator Instructions) One moment please. Our first question comes from Peter Appert of Piper Jaffray. You may ask your question.

Peter Appert - Piper Jaffray

Thanks. Good morning. So, Peter, I was hoping you could give me some added color on the impact of the growth in the proprietary data business on the overall operations. So the growth in FactSet Fundamentals and Estimates, does that create added visibility around revenues because perhaps there’s less seat count reliance and how does that impact the profitability of the business? Thank you.

Mike Frankenfield

Hey, Peter. It’s Mike Frankenfield. I’ll speak to the revenue opportunity. FactSet’s proprietary content gives us a couple of unique opportunities. It gives our clients more choice within the FactSet workstations. As you know we supply content from several third-party providers and now we’re pleased to be able to offer our own offerings in that space and I think clients appreciate that choice.

The second big opportunity content gives us the ability to sell the content directly to clients in a feed form. Many of our clients have back office or middle office applications that are hungry for data and we think there’s a big opportunity out there to supply our data in feed form to those clients.

Peter Appert - Piper Jaffray

How big a business is that for you currently, Mike? How big do you think it could be?

Phil Hadley

Peter, its Phil. It’s hard to decompose our revenues because we’ve always been in the business of supplying software and content. It’s just historically the content was really not billed directly by us or even produced directly by us. So it’s hard to measure.

To answer the first part of the question you asked before on the profitability, it’s definitely one of those where the bigger we get the more scale we have. I would definitely characterize our content operations as profitable. But as you can tell by our headcount growth we continue to invest heavily in it and when you are investing into something new, obviously it doesn’t have a revenue stream or value associated with it so it takes time for it to get scale. But the mature products like Fundamentals, Estimates, and Ownership, M&A, all the ones that have been on the system for a while, deliver a substantial amount of the value of the FactSet service.

Peter Appert - Piper Jaffray

So, Phil, you’ve historically said that driving margin expansion is not one of the key goals. I would think that as the proprietary data business grows as a percent of revenues that would potentially have significant implications for profitability and margin leverage. Is that fair or not?

Phil Hadley

There’s always opportunity for us to drive margins. This is a spectacular business and we could certainly stop investing in our future. I think the big challenge with that in a business like this is that most of the products that you produce or the value you're producing probably has a five year cycle and you need to invest to make sure that you have growth opportunities five years from now.

So I think it would be a mistake for us to stop investing in content and stop investing in our applications. So we use the flat margins really as a discipline to measure whether we should be investing more or less and it's kind of blend this in. But as you can see through time our margins go up and go down on a quarterly basis. We’re not perfect at it. But I think we feel comfortable that the current level of profitable is the right level of profitability for the business. And we’d rather see investments so that we could drive organic growth.

Peter Appert - Piper Jaffray

Okay. And one last thing and then I will shut up. The competitive dynamic Phil, a lot of noise in the marketplace with Thomson and Cap IQ seemingly getting ever more aggressive from a pricing perspective. Can you share with us your color on that?

Phil Hadley

There’s always noise in the marketplace. I can’t really speak to what is taking place inside the other firms but certainly at the competitor level inside the client, the competitive dynamic in the marketplace does not shift quarter-to-quarter. It probably shifts just ever so slightly year-to-year. It’s just because it takes time to convert people’s workloads. We feel very good about our current competitive position and I spend a great deal of time monitoring anytime we gain revenue in client any while anytime we lose revenue in a client any while, and decomposing what the competitive dynamic is and I guess the quick summary is that it just doesn’t change that quickly. We feel very good about our current position.

Operator

Peter Heckmann with Avondale Partners, you may ask your question.

Peter Heckmann - Avondale Partners

Good morning, everyone. Had a question as regards accelerated stock compensation costs in the quarter. The derivate you reported and now your new non-GAAP adds back all stock compensation, but was there some accelerated stock comp in the quarter that was based on increased estimates of hitting instead of targets?

Peter Walsh

Just to remind everyone, in the previous quarter the fourth quarter of 2011, we had a one-time charge of 5.4 million related to increasing the performance of our performance-based stock options. The total stock comp in that quarter was 10.4 million if you backed out that charge. On a recurring basis it was 5 million. Comparing it to this quarter, our stock based comp increased by 900,000 sequentially. And that primarily relates to the increased performance levels achieved in the last fiscal year.

Peter Heckmann - Avondale Partners

Okay. So I guess if I’m looking at it on apples-to-apples basis on an operating margin basis, because we’ve excluded kind of these step-ups in achievement of performance-based options, the reason why I’m stuttering here a little bit is that FactSet’s reporting actually your non-GAAP number is $1.02, but your press release says $1.10 and so I’m wondering if there is like, some amount that really is a nonrecurring number?

Peter Walsh

We backed out all stock-option expense in the non-GAAP number, which includes option expense related to both regular options and performance options and the non-GAAP number is $1.10.

Peter Heckmann - Avondale Partners

Okay. Can you reconcile the number that FactSet is reporting of actual $1.02?

Peter Walsh

Did somebody add back the R&D? I would use our press release as what we actually reported, Peter and I’d be happy to reconcile anything you’re seeing afterwards.

Peter Heckmann - Avondale Partners

Okay. Let me just move onto a second question. You saw a sequential decline in users of 1,200. Do you feel that was all based on headcount reductions? Or in some cases were people moving let’s say associate to a lower cost solution and away from the FactSet platform?

Mike Frankenfield

Yes, our sell side firms, all the firms that buy side Intel sell side are very cautious these days and they’re all scrutinizing their user populations and rightsizing their populations based on product receiving in the market. There are significant cuts going on in the sell side rate now. Most of those cuts do not affect our user base but some of the cuts do affect our user base. And I think the reduction you’re seeing is primarily limited to the sell side and mostly a reflection of the fact that head count has come down a little bit during the quarter.

Operator

Shlomo Rosenbaum with Stifel, Nicolaus, you may ask your question.

Shlomo Rosenbaum - Stifel, Nicolaus

Hi. Thank you very much for taking my questions, everybody. I just want to circle back to the competitive environments. I appreciate the comments that you’ve given, Phil. I want to focus again on that, just with some the dislocation with the competitors out there; there’s been some talk about them trying to stem market share losses by potentially bundling more software together in terms of protecting their base. I was wondering if you’re seeing any of that going on in terms of competitive situations.

Mike Frankenfield

Hi, Shlomo. It’s Mike. I think as Phil stated, our competitive landscape really hasn’t changed that much and it is slow to evolve. We perceive that the landscape is very competitive and what we really focus is executing on our product, executing on our sales strategy. Clients certainly are going to alter their price strategy and bundle if they think they’ve got a competitive situation, where price may help them, but we believe that for the market we serve, our clients are interested in buying the best product, so that’s really what we focus on, is executing, delivering the best product possible and we believe the evidence is showing that versus our largest competitors, we continue to take share.

Shlomo Rosenbaum - Stifel, Nicolaus

So is there any yes, they’re doing it, but it’s not working? Or we have seen no change in the behavior of our competitors over the last couple quarters?

Mike Frankenfield

We’ve seen lots of bundling, lots of price configuration changes happening for as long as we’ve been in the business. I think it’s pretty standard practice for competitors as they perceive they have an advantage or are losing an advantage to alter their pricing in response to how they’re compared again.

Shlomo Rosenbaum - Stifel, Nicolaus

So there’s no change in that aspect of it as of the last few quarters?

Mike Frankenfield

Nothing material, no.

Shlomo Rosenbaum - Stifel, Nicolaus

Okay. That’s what I wanted to get to. Then just, Peter, what tax rate should we assume for the next quarter?

Peter Walsh

I think that the best assumption is to use first quarter’s tax rate going forward which was 32.1%.

Shlomo Rosenbaum - Stifel, Nicolaus

Great. And then how do you differentiate between short-term buying patterns of the customers versus longer-term patterns? Do you differentiate that with sell side versus buy side, do you differentiate that with inter-quarter changes maybe something picked up towards the end of the quarter, how should we think of that?

Peter Walsh

This is probably the way a quarter breaks down, I mean if you’re just taking this quarter, I think that you take what happened in August where you had massive market volatility in two weeks. We’re certainly correlated to the market. You have the buy side mentality and you have a sell side mentality. They both react differently. I’d say the buy side gets cautious; they don’t roll up the tent and go home. The sell side can change very quickly to we’re in cost-cutting mode and the market data vendor procurement person gets a great deal of power and exerts it immediately. And that’s just the mentality of the firms.

I would say just from a characterization, I think the buy side just kind of waits to find out what happens with the year and our first quarter is kind of an odd buying period for our clients and it always has been from a cyclicality perspective. We’re August year end, so our clients hire a lot in the summer and our sales force is driving for the fourth quarter. You get into the first quarter, your September, October, November; it’s not really year-end decisions.

In a normal healthy environment, people are kind of generally kind of buying stuff or stuff that’s just kind of slid just falls in that quarter. Otherwise in an environment like this you can see that people start to slide decisions for the year end and hey wait and see, where is this market going to end up? Are we going to fix what’s happening in Europe?

From a business perspective, our strategy really stays the same in an up and a down market and we feel really good about where we’re headed in the marketplace. I felt very good about our client adds this quarter. It tells me that we’re gaining share at the client add side of the business. The sell side, my ability to predict the next 12 months of sell side revenue for us, I wouldn’t want to bet a penny on it as far as what happens on a forward 12 months.

The buy side of the business, actually did pretty well this quarter, pretty darn similar to what it did last year. So, even in a tough environment we did pretty well. You can see by our head count, we’re investing a great deal in head count and that’s really just confidence in the fact that we’ve got great ideas and believe we can convert into product. And then if you look at everything else we did this quarter, the financial metrics, whether it’s the DSOs, the free cash flow, it’s just a great business that we’re in.

Shlomo Rosenbaum - Stifel, Nicolaus

Right. I’m not trying to take away anything from that. I’m just trying to understand the comments in the press release that volatility in the financial markets interrupted short-term buying patterns from clients. Short-term is net debt defined by the sell side versus long term defined by the buy side?

Peter Walsh

Yes, I think that the short term is, they got cautious. The long term is that we’ve got a large sales force worldwide, it's very engaged with our client base and all of the products and things that we’re – solutions we’re providing for our clients are all very active. And our clients are excited about the product we’re producing for them.

Shlomo Rosenbaum - Stifel, Nicolaus

Okay. And what we do is one last question. You guys have said you’re comfortable with the current state of profitability which you think is a fair long-term state of profitability. What do you think is a fair long-term state of growth for the company?

Peter Walsh

Since I’ve been in the business, my goal is to double this business. Internally we’re talking about doubling this business and it’s the way we look at everything we do and that is making sure we put the pieces in place to make sure that happens. In Mike’s world let’s make sure I have the sales force in place, to make sure I can sell that much product. In Peter’s world it’s about building the product and making sure that we’re delivering that kind of value to the marketplace. We’re in a business that the biggest two players add up to a $15 billion in opportunity. So, the market’s got to be close to $20 billion out there and we’re not even $1 billion yet. So, I look at it and think if we just keep executing the opportunity for us to deliver our business is right in front of us and we just keep marching ahead.

Operator

Dave Lewis with JPMorgan Chase, you may ask your question.

Dave Lewis - JPMorgan Chase

I wanted to ask a quick question on the trading solution that just recently rolled out. I think this question might be for Mike. Mike, the last time you sized it as the opportunity as much larger than the current business but I was just curious if you could provide an example of what the breakout between trading – what the trading personnel at an average buy side loan-only equity client would be versus your existing users that you sell in to? So, is it 1.5 to 1? Or is it 1 to 1? How many buy side traders do you have in your average loan-only equity client, if you could frame it in that type of terms please?

Mike Frankenfield

Well the average number of traders at a buy side firm is going be anywhere from just a couple to maybe 20. It’s going to vary significantly based on the size of the firm. We’re in the very, very early stages. We have a compelling product with some unique functionality out there in the marketplace and it appears that we’re gaining some good traction amongst our buy side clients and it’s a great collaborative process. It’s how so many of FactSet’s products get developed, we have been collaborating with our clients to understand their work flow challenges and then design our solutions to enhance their work flow.

Dave Lewis - JPMorgan Chase

Thanks, Mike. And then sorry to belabor the competitive questions but I just wanted to ask you about Bloomberg rolled out a portfolio of risk analytic solution and I know that I think the PA suite has been around for a long time, 1997 or in that range. But if you could just comment on FactSet’s strongest competitive advantages versus that product, whether it’s primarily the consolidation capabilities, the eight applications et cetera? I think that would be helpful.

Mike Frankenfield

Our PA suite is as you just mentioned, it’s a suite of products. It doesn’t focus on just attribution or just risk. We consider it to be the premiere product in the marketplace and it’s got incredibly deep functionality that’s capable of meeting the needs of the most sophisticated user yet it can also be set up in a way to meet the needs of very, very casual users. So we feel like we address a broad spectrum of needs within our asset management clients. And as I said earlier, our clients are interested in buying the best product. When we’re looking at markets that are volatile and uncertain, having the best measures of performance, having the best measures of risk, I think are what are appealing to our clients.

Phil Hadley

I would take it one step further in that it’s definitely one of those products that’s been in the press now for three years but it’s invisible in the marketplace with us at this point. We found one client that was promised a great deal. It didn’t work for them and they moved to our product but other than that it’s one that I carefully watch the marketplace to understand where our competitive risk is and we feel that we definitely have the complete solution for our clients at this point and that product’s not there to meet the client work flow that we currently provide.

Operator

John Neff with Akre Capital Management, you may ask your question.

John Neff - Akre Capital Management

Two questions, first, Peter; I think you mentioned unexamined spending is at an all-time low among your clients. I was just wondering how you are going to handle on that, how you gauge that. And two, I wanted to ask you about Europe at about 24% of revenue. I’m just trying to get any more color on some of the market dynamics you’re seeing there? Perhaps what the buy-side sell-side mix is in Europe? And any other color you can provide? Thanks very much.

Peter Walsh

In terms of unexamined spending, that’s just a judgment call on my part, just some antidotes from the sales force and how they describe their experience with clients. I do think generally all clients including buy-side clients have learned from ‘08 and ‘09 and have more tools and more careful about their spending in general. I think that’s really what that point’s it out.

Phil Hadley

And, John, it’s Phil. Starting the international environment, we see volatility and difference performance in different regions not only in Europe but across the globe. Some of our Asian markets and our Middle Eastern markets are performing extremely well. There’s softness in certain areas of Europe, yet other areas or other countries in Europe are performing very well. No doubt that on the continent there’s a certain degree of cautiousness, but again we’re small in that area relative to the potential addressed in the universe, and we continue to chip away.

Operator

Robert Riggs with William Blair, you may ask your question.

Robert Riggs - William Blair

Since you remain committed to adding head count primarily on the content side and but also some of the client facing personnel as well, I was just hoping you could comment on the productivity trends you’re seeing in terms of new hires? And maybe how much room you have for improvement going forward there and what might those key drivers might be?

Peter Walsh

It’s kind of an interesting question. I guess I would certainly decompose it this way. When we hire somebody new into FactSet and it really doesn’t matter what area you’re hiring them into. I think we probably at least have a period of six months of investment in every employee we make before we get a reasonable return on our investment. And that’s probably true in content, engineering and the client facing employees. And from that point on it’s certainly one of mutual benefit. Their careers are off to the races and the value they produce for FactSet is growing every day.

Robert Riggs - William Blair

Okay and that ramp time, it sounds like it’s been pretty consistent over the last several quarters?

Peter Walsh

Yes. I think it's obviously really depends on the work flow and what group you’re in. In content it might be quicker on some applications depending on how complex the content to collect is and slower in others.

Robert Riggs - William Blair

Okay. And then do you guys haven’t been too acquisitive of a company, but just given this lingering period of market volatility, could you just comment on the acquisition pipeline? Are there are some things emerging maybe a little more attractive these days?

Peter Walsh

I think we see a very active M&A opportunity pipeline. I think we’re probably see three, four a quarter that could come by as potential opportunities. For us, at this point we really can be very selective in what is interesting to us, both on a valuation and a workflow perspective. I think we feel very good about our organic opportunities. So, for the most part we take it fast because it’s not good return on the time and integration and in dollars that it would require.

Operator

(Operator Instructions).

Peter Walsh

Looks like the end of the questions. Have a great day. Thank you.

Operator

Thank you for your participation. Your call has concluded. You may disconnect at this time.

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