Operator:

Welcome to the quarterly results call. My name is Jackie, and I will be your operator for today's call. [Operator Instructions] Please note that this conference is being recorded. I would now like to turn the call over to Mr. Scott Pagan. Mr. Pagan, you may begin. J. Pagan: Thanks, Jackie. Thanks, and good afternoon, everyone. Joining me remotely on the call today are Ed Ryan, CEO; and Allan Brett, CFO. I trust that everyone has received a copy of our financial results press release that was issued earlier today. Portions of today's call other than historical performance include statements of forward-looking information within the meaning of applicable securities laws. These statements are made under the safe harbor provisions of those laws. These forward-looking statements include statements related to our assessment of the current and future impact of the COVID-19 pandemic and Russia-Ukraine conflict on our business and financial condition, Descartes' operating performance, financial results and condition, Descartes' gross margins and any growth on those gross margins, cash flow and use of cash, taxation rates and use of tax assets, business outlook, baseline revenues, baseline operating expenses and baseline calibration, anticipated and potential revenue losses and gains, anticipated recognition and expensing of specific revenues and expenses, potential acquisitions and acquisition strategy, cost reduction and integration initiatives and other matters that may constitute forward-looking statements. These forward-looking statements involve known and unknown risks, uncertainties, assumptions and other factors that may cause the actual results, performance or achievement of Descartes to differ materially from the anticipated results, performance or achievements implied by such forward-looking statements. These factors are outlined in the press release and in the section entitled Certain Factors That May Affect Future Results in documents filed and furnished with the Securities and Exchange Commission, the Ontario Securities Commission and other securities commissions across Canada, including our management's discussion and analysis filed today. We provide forward-looking statements solely for the purpose of providing information about management's current expectations and plans relating to the future. You are cautioned that such information may not be appropriate for other purposes. We don't undertake or accept any obligation or undertaking to release publicly any updates or revisions and any forward-looking statements to reflect any change in our expectations or any change in events, conditions, assumptions, or circumstances on which any such statement is based, except as required by law. And with that, let me turn the call over to Ed. Edward Ryan: Thanks, Scott, and welcome, everyone, to the call. We had excellent fourth quarter and year-end financial results, our best ever. I'm excited to highlight some of them for you. But first, let me give you a road map for this call. I'll start with highlighting some aspects of our financial results, some factors that we believe contributed to them and some comments on the current environment that we're operating in. Then I'll hand it over to Allan, who will go over the Q4 and annual financial results in more detail. I'll then come back and update on how our business is calibrated, and we'll then open it up to the operator to coordinate the Q&A portion of the call. So, let's get started by looking at Q4. We had record high revenues of $112.4 million, up 20% from a year ago. Net income was $19.2 million. Adjusted EBITDA was a record high of $50.1 million. We generated $45.5 million in cash from operations or 91% of our adjusted EBITDA. Our adjusted EBITDA as a percentage of revenues was 45%. All of these metrics were ahead of our plans. So, a very strong financial quarter for us. And that quarter rounds out a truly solid financial year for us of record annual results across the board. We had record revenues of $424.7 million. We had record net income of $86.3 million or $1 per share. We had record adjusted EBITDA of $85.7 million. We had record cash generated from our operating activities of $176.1 million or 95% of our adjusted EBITDA. Our adjusted EBITDA as a percentage of revenues was 44%. All of this was well ahead of our plans and as a result of a solid work from our team and our business throughout the whole year to deliver some great results. I don't want to spend too much time looking in the rearview mirror. We're already a month into our next quarter and financial year and the world and the business environment have changed massively over that month. So, let me highlight a few things that I think contributed to us doing well last year. First, our business does well in a changing and complex business environment. Second, prior investments drove organic growth. Third, we're a market leader in the real-time visibility space. And fourth, our acquisitions have contributed very well. So, let me speak to each of these 4 areas. So, the first one, our business does well and changing in complex times. Historically, our business has done well when the supply chain and logistics market is changing and/or becomes more complex. Our core mantra for why we exist is to help isolate our customers from complexity. Goods moving from point A to point B will pass numerous international borders, attract a bunch of paperwork for security and customs filings, be charged multiple taxes, travel through multiple modes of transportation and touch multiple parties to get to their destination. And this complexity changes depending on what particular commodity or item you're shipping. Does it need special handling, refrigeration, does it attract a particular regulatory scrutiny? There's a host of issues. It's not practical for any one company to be able to handle all of these logistics issues in-house and still be successful in its own business. That's why the supply chain and logistics market space is so fragmented. There are firms that are very specialized. More and more information and technology has become key to helping things move from point A to point B. And that's where and why we exist. We're specialists in providing the information and technology to help isolate people from logistics complexity rather than you connecting to thousands of trading partners you can connect to us once, and we'll use our network to connect to the trading partners. Rather than stay up to date on every tariff for every country, for every commodity in the world, subscribe to our service and let us handle that complexity. If you're moving shipments through multiple trucking companies and using various brokers, use our real-time visibility to connect to all these parties to track their shipment. And as things get more complex or change, it becomes more and more clear why you need a trusted party like Descartes to help you with technology and information. It's too much and too time consuming to handle all on your own. The COVID pandemic forced every business to change its supply and delivery practices, whether it be where they got their supplies, what companies they work with or how they would remotely get visibility to their shipments and deliveries. That change in complexity drove demand for our products and services. Another example is what happened in the United Kingdom with Brexit. A huge complexity was introduced to move things between the EU and the U.K. New filings needed to be made, new procedures needed to be followed. New tariff structures needed to be adhered to, things changed and it became more complex to move goods. This drove very good demand for our services, in particular the customs filing arena. We were able to help our customers -- help our existing and new customers cope with the complexity and change and as a result, it contributed to our business growth last year. So, that was a good tailwind for us last year, changing complexity and how goods are supplied and delivered drove good demand for our products and services. The second area is that prior investments are driving organic growth. As we started last fiscal year, I indicated that we intended to invest overperformance back in our business, specifically in our go-to-market activities, our intention in doing that was to strengthen our business for the long-term, sustainable growth and drive additional organic growth. We focused our investments in a few areas. First, we invested in our sales team by taking a very customer-centric approach to helping customers with their problems. This resulted in us refocusing our sales group, deepening our expertise in North America and strengthening our leadership presence in EMEA. Second, we made investments in building out our customer success team on a global basis and across many product groups. We recognize that we have an enviably large customer base and we wanted to be more focused on how we could do more with our existing customers and ensure we were being responsive to their needs so they would help -- so they would keep using our services. Finally, we made investments in marketing to modernize our practices through the use of technology and different marketing expertise. We believe that the pandemic pushed us forward to move away from reliance on legacy marketing geared towards trade shows and are now future focused on things like Search Engine Optimization and finding innovative ways to engage with our customers to identify and serve their needs. As you've seen it over past quarters, we've generated some pretty good organic results growth as some of the early returns on these investments paid off quickly. We expect this growth to ebb and flow as we learn and fine-tune our investments, but we're very pleased with the start. So overall, our go-to-market team and their progress has been a big contributor to our success over the past year, thanks to all of them for their hard work. Third, we're a market leader in the real-time visibility space. Several years back, we combined with MacroPoint to strengthen our visibility services. Our goal as a combined business was to run a successful and sustainable business, one that provided quality service and a sustainable business model where our customers wouldn't have to worry about whether our business would financially survive as customers became more and more reliant on our service. That business combination has been very successful. We believe we're a preeminent and real-time visibility provider in the market. Our Global Logistics network provides the infrastructure to connect with all the parties involved in helping a shipment move from point A to point B, meaning we've got the infrastructure to focus on and deliver global visibility across every mode of transportation. Last year, we tracked over 575 million shipments in real time for our customers. Real-time visibility has been and is one of our core competencies and it's recognized by our customers and the market. So, MacroPoint and real-time visibility was an excellent contributor to our success last year, and we believe there is still good momentum there. And finally, our acquisitions. Our business is designed to grow organically and by combining with complementary businesses. It's a model we've used successfully for the past 15-plus years. Over that time, we've combined with over 50 businesses. This past year was no exception as we combined with 3 businesses. Last February, at the start of our fiscal year, we combined with QuestaWeb to strengthen our customs compliance business and add free trade zone functionality to what we do. In May, we combined with Portrix in Germany to strengthen our rate management solutions and complement our investment in containers, where we help ocean carriers and intermediaries modernize their business for e-commerce engagement. In July, we combined with GreenMile to expand our route management in mobile technologies in food, beverage and other distribution verticals. Each of these combinations was well received by our customers and collectively, they contributed well to our success last fiscal year. As we started this fiscal year, we've already closed on new acquisition, our combination with NetCHB a few weeks ago. NetCHB is the security and customs filing business in the U.S. like we are. NetCHB has a particular strength in Type 86 filings, which are U.S. customs filings that are made when the value of an import is below $800. Type 86 filings are often leveraged by e-commerce providers selling low-value goods because there is an expedited import and filing process for service provider success is often dependent on the ability to handle high volumes of filings. NetCHB also has some traditional customs broker functionality to help with filings, and we've already made some joint sales for some new customers. All in all, we think this is a great complement to our business and we're excited to welcome all our new NetCHB team members to Descartes. So, acquisitions were a good contributor for us last year. And given how we've already started this fiscal year, we're on the right track for it to continue this year. So, those are some of the things that contributed to our success last year. We expect most of those factors to continue to influence our financial results this current financial year. However, there are also some newer factors shaping the business environment right now that I wanted to comment on. They are the Russian-Ukraine conflict, inflationary pressures and resource scarcity and ongoing inventory replenishment. So, let me start with the Russia-Ukraine conflict. Nothing I say on this call is going to give anyone any greater insight into how that conflict started or how and when it will end. The only thing I can say with certainty is that there is a lot of uncertainty at the moment. Descartes itself does not have a direct presence in either the Ukraine or Russia and almost no customer or supplier relationships. So, no direct financial exposure. So, when we consider the impact of the conflict on Descartes' business, our thoughts turn more to what impact -- what the impact will be on our customers, the global trade environment and the global economy as a whole. This conflict will have an impact on supply chain and logistics market. We've already seen a few consequences in the early days. The Ukraine ports have closed impacting the flow of goods. Russian forces have destroyed some Ukrainian air cargo freighters, sanctions will likely impact operations at ports and other countries. Airspace has been restricted for Russian air traffic impacting air cargo capacity that's available and the link and cost of flights. Similarly, Russia has restricted access to its own airspace to more than 30 countries. Some companies rely on raw materials from Ukraine or Russia causing some manufacturing factories to close and undoubtedly impacting supply. Various multinationals have suspended or withdrawn from their Russian operations. Russia and Ukraine concrete -- sorry, Russia and Ukraine contribute oil and natural gas to the energy market. And with the supply being curtailed, there could be a meaningful impact on energy prices and the prices of other commodities. Some logistics companies, including FedEx, DHL and UPS have suspended shipments to Russia. Ocean Network Express, Maersk and MSC have all halted bookings to Russian destinations. All of this could impact renewable trade volumes. And finally, severe sanctions have been placed on businesses and individuals associated with Russia and Belarus impacting supply chains of numerous businesses and where they can sell their products and services. For example, Apple has announced that it stops sales of its products in Russia just a few days ago. All of these factors bring complexity and change to the market. As I mentioned earlier, our business has historically done very well when there's complexity and change. However, given how early we are in the conflict and the possible impact on the global economy, it's too early for anyone to be able to accurately predict how their business will fare, Descartes included. This type of complexity and change brings opportunity and potential risk. Let me give you some examples of each. From an opportunity perspective, numerous countries around the world just imposed severe financial and other trading sanctions on Russia and Belarusian banks, government entities, individuals and companies. The names of each of these entities and individuals went on numerous list prohibiting countries from trading or otherwise doing business with them. Compiling these lists of denied or sanctioned parties and screening customer list for transactions for compliance with those sanctions is one of our core businesses. Denied and Sanction Party Screening was just confirmed by multiple countries to be critical to have severe penalties for noncompliance. We're a global leader in this space. We expect new and existing customers will lead us to help them in this regard. Another opportunity comes from force changes in supply chains. Most companies will have some impact on their business where they'll need to establish new trading relationships with parties in new countries and trade lanes to get materials for their business. To do this, they'll need to electronically connect to new parties something that our global logistics network is ideally suited to help them win. Each new opportunity has a darker cloud hanging over, which is the potential impact to the global economy. Our success over the past periods and changing and complex times has been because we were able to help our customers be successful. This is a much more challenging task in an environment where global trade volumes go down or the global economy contracts. And right now, we just don't know what the impact of the conflict or the resulting financial sanctions will be on either trade volumes or the economy. It's something that like everyone else, we will continue to monitor. Let me just speak in one other somewhat related risk and that's cybersecurity. Over the past several years, we've seen various businesses and markets severely hampered by ransomware attacks with the attacks often state-sponsored by foreign governments. It's hit the oil and gas industry, medical community and education market. The supply chain and logistics markets have not been immune. All 4 of the world's largest ocean carriers have been hit by ransomware attacks over the past several years. Over the past 2 weeks, a cyber incident impacted expeditors and caused them to have to rebuild their operations. It's possible that one of the consequences of this conflict is an increased level of cyber-attack on businesses. Since the conflict started, Toyota suspended its domestic factory operations in Japan as it dealt with a cyber-attack. It's quite possible there will be more. It's an area of increased attention for our customers and suppliers and for Descartes as well. So, the Russia-Ukraine conflict brings a lot of uncertainty and it introduces complexity and change to logistics and supply chain operations. There are opportunities to help our customers with these challenges and risks from the world with increased geopolitical tension and economic fragility. We're certainly being careful as we move forward in our business. Second issue is inflationary pressures and resource scarcity. Even before the Russia-Ukraine conflict brought uncertainty of the economic conditions, the economy was dealing with a bunch of inflationary pressure. This seems like a somewhat logical consequence with so much new money being pumped into the system during the pandemic to aid with recovery. Those inflationary pressures have hit the logistics and supply chain community. The cost of raw materials and goods all through the supply chain have increased, resulting in increased prices to consumers. Logistics markets have increased the prices on containers and vessels and carriers have imposed supplemental fees. In addition, label markets have faced wage pressure resulting in competition among companies to get the needed drivers, warehouse workers and port personnel needed to keep goods moving. On top of this, as I mentioned on a previous call, there's a general human resource scarcity that exists in logistics and supply chain markets. For example, the lack of skilled drivers in the U.S. has resulted in novel solutions to increase that talent pool, such as lowering the minimum wage -- sorry, minimum age limit to be able to drive a truck. Businesses have also struggled to find workers in light of vaccination requirements and quarantine impacts on labor availability. And there's potential labor unrest with the ongoing negotiation of the International Longshore and Warehouse Union contract for the West Coast port workers. Inflationary pressure is just one more challenge for our customers to face to get to the right and sufficient people to keep goods moving. It's something we need to be aware of since we have a real interest in helping our customers move as many shipments as they need to. And the final is inventory replenishment. Retailers of inventory levels that are historic -- at historic lows as a percentage of their revenues. There has been some recovery over recent months. However, the logistics infrastructure just isn't there to let them catch up as quickly as many of them would probably like. Many retailers adopted revised logistics strategies to avoid the multiple -- multi-vessel backups that were happening on the West Coast ports over the last several months. Well, the good news is the back up on the West Coast ports is lessening, the bad news is that the East Coast ports where all that traffic was shifted to are now backed up. All that to say that there is still a demand for goods and inventory in the market as retailers try to replenish. Ultimately, this remains a good tailwind for demand in the logistics and supply chain market. So, I know that was a little longer in my opening comments that unusual. However, given the recent events in the Ukraine, I wanted to provide some context as to both what's impacted our business historically and what the business environment is that we're working in right now. The highlight of today's announcement is a great quarterly and annual financial results that were well ahead of our plans. We had some strong investments and business conditions pay off for us over the last year, driving both organic and acquisition growth. Our customers have been presented with some unique challenges over the past month that will -- that we know they'll be looking to us to help them with. We have a good history of dealing with challenges. Our team has built a business that has been resilient through past challenges. We believe that we have a track record products, team and financial strength to meet the challenges our customers and our business face today. Once again, thanks to the entire Descartes team for their efforts this past year and for the work they're doing right now to help our customers deal with all the change and complexity in the world right now. With that, I'll turn the call over to Allan to go through our Q4 and annual financial results in detail. Allan? Allan Brett: Thanks, Ed. As indicated, I'm going to walk you through our financial highlights for our fourth quarter and year ended January 31, 2022. We are pleased to report record quarterly revenues of $112.4 million this quarter, an increase of 20% from revenues of $93.4 million in Q4 of last year. Our revenue mix in the quarter continued to be very strong, with services revenue also increasing 20% to $99.5 million from $82.7 million last year in the fourth quarter, representing 89% of total revenue in each period. Professional services and other revenue, including hardware revenue, came in at $11.7 million or 10% of revenue, up from $9.3 million last fourth quarter and also consistent at 10% of revenue in each quarter. While license revenue was just over $1 million or 1% of revenue in the fourth quarter this year, very similar to the fourth quarter of last year. For the year, revenue was a record $424.7 million, up 22% from revenue of $348.7 million in the previous year. Gross margin came in at 76% of revenue for the fourth quarter, up from gross margin of 75% in the fourth quarter last year. For the year, gross margin was also up from 74% to 76%, consistent with the trend in the fourth quarter with this improvement being a result of increased operating leverage from the organic growth we experienced in the business. Operating expenses in the fourth quarter and for the year ended January 31, increased primarily related to the impact of recent acquisitions, but also, as Ed already mentioned, as a result of additional investments that we made in our business over the past year, including in the areas of sales, marketing, development activities and network security. However, despite these investments for the third year in a row, as a percentage of revenue, the increase in operating expenses was once again lower than the increase in revenue as we continue to benefit from our operating leverage as we grow. As a result of the revenue growth, gross margin expansion and continued operating cost leverage that I just described, we continue to see strong adjusted EBITDA growth to a record of $50.1 million or 44.6% of revenue in the fourth quarter, up 30% from $38.6 million or 41.3% of revenue in the fourth quarter last year. For the year, adjusted EBITDA came in at $185.7 million or 43.7% of revenue, up 31% from adjusted EBITDA of $142.0 million or 40.7% of revenue last year. As a result of these solid operating results, cash flow generated from operations came in at $45.5 million or approximately 91% of adjusted EBITDA in the fourth quarter this year, up 25% from operating cash flow of $36.5 million or 95% of adjusted EBITDA in the fourth quarter of last year. For the year, cash flow from operations was $176.1 million or 95% of adjusted EBITDA, up 34% from $131.2 million or 92% of adjusted EBITDA last year, primarily as a result -- this is a result of some very strong cash flow collections from our customers. Going forward, subject to unusual events and quarterly fluctuations, we expect to continue to see strong operating cash flow conversion of approximately 85% to 90% of our adjusted EBITDA in the periods ahead. From a GAAP earnings perspective, net income came in at $19.2 million, up 12% from net income of $17.2 million in the fourth quarter last year. For the year, net income was $86.3 million or $1 per diluted common share, up 66% from $52.1 million or $0.61 per diluted common share last year. Overall, as Ed mentioned earlier, we're certainly pleased with these operating results for fiscal 2022 as revenue growth of 22% allowed us to invest significantly in our business while allowing us to achieve 31% growth in adjusted EBITDA, expand our adjusted EBITDA margin to 43.7% of revenue and achieve 34% growth in our cash flow from operations for the year. If we turn our attention to the balance sheet, our cash balances totaled $213.4 million at the end of January '22, and we did not have any borrowings outstanding under our credit facility at the end of the year. Subject to year-end, on February 9, we announced that we had used approximately $40 million of our existing cash balances to complete the NetCHB acquisition, which Ed described in some detail just earlier. As a result, we currently have approximately $175 million in cash balances as well as $350 million available for us to draw under our credit facility for future acquisitions. So as always, we continue to be very well capitalized to allow us to consider all acquisition opportunities in our market, consistent with our business plan. As we look to the current year, our fiscal 2023, we should note the following. After incurring approximately $4.8 million in capital additions this past year, we expect to incur approximately $4 million to $5 million in additional capital expenditures in the coming year with a continued focus on IT security. We expect amortization expense will be approximately $54 million for fiscal 2023, with this figure being subject to adjustment for foreign exchange changes and any future acquisitions. Our income tax rate in the fourth quarter came in at 26% of pretax income, resulting in a tax rate for the year of approximately 16% for fiscal 2022, which is significantly lower than our statutory tax rate in Canada and the U.S., mainly as a result of recognition of previously unrecognized tax losses that occurred earlier in the year. Going forward, we'd expect that our tax rate will be closer to our statutory rates, resulting in an expected range of 25% to 30% of our pretax income for our fiscal 2023, though, as always, we should add that our tax rate may fluctuate from quarter-to-quarter from one-time items that may arise as we operate internationally across multiple countries. And finally, we currently expect stock compensation to be approximately $9.3 million for fiscal 2023. And this will be subject to expected future grants as well as any future forfeiture of stock options or share units. I will now turn it back to Ed, who will wrap up with our baseline calibration. Edward Ryan: Thanks, Allan. Our business is designed to be predictable and consistent. We believe that stability and reliability are valuable to our customers, employees and to our broader stakeholders. To deliver this consistency, we continue to operate from the following principles. Our long-term plan is for our business to grow adjusted EBITDA 10% to 15% annually. We grow through a combination of organic growth and acquisitions. We take a neutral party approach to building and operating solutions on our Global Logistics Network. We don't favor any particular party. We run our business for all supply chain participants connecting shippers, carriers, logistics service providers and customs authorities. When we overperform, we try to reinvest that overperformance back into our business. We focus on recurring revenues and establishing relationships with customers for life. We thrive on operating a predictable business that allows us forward visibility to our revenues and investment paybacks. We performed well ahead of our plans in Q4. Our plans are to reinvest that performance back in the business. We'll continue to invest in the front end of the business as we're having good success, as I mentioned earlier. We also plan to keep pushing to accelerate product and acquisition integration. We believe preparation is a key to the success, which is why we set out annual and quarterly plans by sticking to a plan -- but sticking to a plan could be foolish if the world around you fundamentally changes and to be cautious in executing on those plans while we continue to monitor and evaluate the impact on our business and our customers' businesses from the Russian-Ukraine conflict. That same caution was kept in mind as we calibrated for our business in Q1. In our annual report, we provided a comprehensive description of baseline revenues based on calibration and their limitations as of February 9, 2022, other stakeholders. On the other hand, like everyone else, we're troubled by the awful events of the Ukraine-Russia conflict and are hoping for a quick and peaceful resolution that will save the unnecessary loss of so many lives. Our guiding light in these periods of uncertainty is our customers. We'll continue to focus on helping them meet the numerous challenges they're facing in this market. We're here to help them deal with this change in the complexity. If we do this, we'll remain strong and trusted business that will deliver superior results for our customers and our shareholders. Thanks to everyone for joining us on the call today. As always, we're available to talk to you about our business in whatever manner is most convenient for you. And with that, I'll now turn the call back over to the operator for the Q&A portion of the call. Operator: [Operator Instructions] And our first question comes from Paul Treiber with RBC Capital. Paul Treiber: Just in regards to the acquisition of NetCHB, can you speak to some of the run rate revenues and profitability? And then also, the earnout is a relatively large portion of potential compensation here. Why is that a little bit higher than maybe what you've previously done? And can you speak to the future growth there? Edward Ryan: Sure. We're really happy with the acquisition of NetCHB. The -- let's say, the way we acquired is probably in line with a lot of the tuck-ins that we do and the multiples that we might have paid for those in the past. We think it's a great business. We think we really got lucky to get it. Took a little while for us to get this one done. But it was a competitor of ours in this space, specifically in some of the customs filing initiatives that they're involved in, we are also involved in and we think coming together provides a real opportunity for their customers to be doing business with a bigger company. There's also a lot of customers that we have that we think might be a benefit from some of the things that NetCHB does. And those are the makings of a great acquisition. With regard to your question about the earnout, there was a lot of uncertainty. I mean, earnouts for us are usually, because the 2 parties can't agree on what's the fair price because they don't know what's going to happen in the future. And maybe that speaks to some of the opportunity we see there in the size of the earnout that was put in place. So, we hope we pay every dime of it. We don't know what's going to happen here, that's why the earnout exists. But for us, as with any acquisition, any earnout that we put in place, we usually think if we're willing to pay that extra money, we're going to get even more benefit -- business benefit from it if it happens. So, we're going to watch and see what happens. But at a very high level, were very excited about adding NetCHB to our team. Paul Treiber: With NetCHB, I mean, you have a pretty large e-commerce business now. How do you see cross-selling synergies and the cross-selling strategy between those different e-commerce businesses and to the extent that can you bundle that together into sort of a more cohesive offering or packaged offering to your customers? Edward Ryan: For sure. You can already see that going on in our business before we bought NetCHB. And you're right, NetCHB is in an odd way in the e-commerce business because the Type 86 filings that they specialize in are for shipments that are coming out of -- into the United States from other countries, oftentimes China and other areas in Asia where they're being shipped in individual pieces across the ocean. But there's lots of opportunities for customers to save money in the process of consolidating those loads into single boxes on planes or boxes on ships and then being mailed using the parcel or U.S. Postal Service once they get to the United States. It saves on freight, saves on tariffs and duties and is a real opportunity for our customers. You can see with some of the other stuff that we've bought in e-commerce space over the past 6 or 7 years, we've already put them together and sell them together, and you could see some of the growth in that business has been excellent and a lot of it's due to cross-selling. Someone needs a parcel management system and someone needs a transportation management system, someone needs a warehouse management system. And we now have all those components to put together and make one offering to customers. And it's, I think, becoming more and more attractive to these online retailers that are selling on Amazon or Google or Overstock or eBay or whatever. And they're buying -- as they get bigger, they need more sophisticated logistics and supply chain solutions and we're the guy walking in the door with a full suite of products to solve the whole problem. So, it's been very good for us. Paul Treiber: And just lastly, and almost following up on just the last point you made in terms of walk in the door. You made earlier in the prepared remarks you made a strong case for Descartes' value proposition in connecting parties and even managing denied parties. From a marketing perspective, how are you -- what's the strategy to raise awareness of your full breadth of solutions and even raise awareness for Descartes in general with potentially new customers out there? Edward Ryan: Well, it's interesting. We know most of the big guys in this space. We do business with them already. So, it's easy for us to go right to the larger players in the space. I suspect what you're talking about is the medium and smaller players that we're getting into in the last 10 years and maybe even do it pretty effectively right now. I continue to see more and more Descartes web adds in places that I didn't expect when I'm searching on newspaper articles and things like that, where Descartes is coming up more and more. That helps us get to these small and medium-sized players. Certainly, some of the web optimization and search engine optimization tools that we've been putting in place and making investments in, in the past year or 2, oftentimes driven by the pandemic, but now I think this is never going away for us to get higher up on the search results for companies that are looking to sell problems that we solve. And frankly, from a cross-selling perspective, once we get in the door, our job is to get in the door and then start selling more and start telling them why just like you might see at the bottom of an Amazon page, people that bought this also by this and this, you should take a look at those 2 solutions. I think over the last 5 or 6 years, our team has gotten much, much better and even perhaps really, really good at doing that so that our cross-selling numbers continue to rise. Operator: Our next question comes from Paul Steep with Scotia Capital. Paul Steep: Can you just talk a little bit about how we think about momentum heading into this year? Because I know there's a lot of puts and takes you outlined, which is helpful. But one, I guess, I'm just thinking of in the customs area, last year, we had a big lift from Brexit. Where do you maybe see the momentum shifting to, Ed, in terms of the business? Like obviously, e-comm is strong, real-time is strong. Is there anything we should think about just with regards to sort of lapping a Brexit anniversary as we model forward? Edward Ryan: Yes. I mean there's always going to be more customs filing initiatives that come along. But you're right, that Brexit one was the big one and we really capitalized on it pretty well. So yes, the things that -- so to say this, but some of the things that you see in the tariff and duty and the sanctioned parties databases that we sell are being highlighted by this conflict that's going on right now. And the world is about to see a whole lot more sanctions placed on people. They're about to see a whole lot of tariffs and duties change as a result of some of the things that are going on right now. And that puts pressure on people to make sure they have a database like ours, so they don't make a big mistake that cost them big governmental fines. So, that's certainly an opportunity for us. The supply chain visibility space is booming for us. The e-commerce space is doing very well. On top of gigantic growth last year, we're still seeing handsome growth in that business. And I think a lot of areas in that business are still doing very well. Our routing and scheduling businesses, I think more and more companies are as we always thought, but now it's really coming true, more and more companies are realizing I need to get good at delivering to the home before someone else does it for me. And we're seeing a lot of strength in that business with some pretty large wins over the last 6 months or so here that I think will propel us into next year. So, a lot of areas of the business is going pretty well. We'll see what happens. I don't know what happens to the world economy. But right now, when you see backlogs at ports and supply delays and I mentioned inventory levels of retailers being on the low side, those are all opportunities for us to have more shipments in the coming months. So, let's do that. And I think with each one, we're thinking of more things that we could do to back them up a little more efficiently so that they can get back up and running on a fully hosted solution of ours as quickly as possible. So yes, I mean it's an opportunity for us and I think a bigger one moving forward. Paul Steep: Can you just talk a little bit about the front office. Obviously, we started talking about the increased investments there, but maybe some of the changes you're making around the sales team and you highlighted it at the start in your comments, but how much more opportunity is there to sort of further evolve or maybe sort of realign the organization, do you think there is as you go forward? Edward Ryan: I mean all the stuff that we've done has been additive. It kept the existing organization in place and added to it to make them stronger and specifically stronger in their ability as our customer. I mean, our customer base is well into the 20,000s now. And that's a lot of different customers to know and understand to be able to effectively sell to them. So, we've been putting people in place that really understand the various markets that we sell to, so that we're always going in and speaking from a position of strength in terms of knowledge of their business and how we might solve their problem. And I think you'll see us continue to do that because -- or make more investment there over time because it continues to go well. Every dollar we're putting in is coming back in spades. So, I don't see us slowing down until we think we might have met a point where it's really not additive anymore and then maybe would slow down. But I don't see that happening anytime soon. I think we're continuing to add there, trying to do it at a reasonable pace. We're pretty conservative operators. You're not going to see us massively change the amount we spent on sales and marketing. But we keep adding people and software tools to help our customer-facing employees that are working with customers, be better at their jobs and better understand the customers they're serving so that they can be better. Operator: Our next question comes from Justin Long with Stephens. Justin Long: I wanted to ask about organic growth. Could you share your best guess on where organic growth shook out in the quarter? And then also as we think about this next fiscal year, you're going to be lapping pretty tough comps on that front. So, any thoughts around the pace of organic growth over the next year? Edward Ryan: Yes, sure. You can see in some of the numbers we had a good year. We're always focused on EBITDA growth. I've highlighted that a couple times and probably a couple times on every call you've ever heard me do. We're focused on 10% to 15% EBITDA growth, half coming from organic activities, half coming from acquisition growth. You can see in this past year, we've been able to get to those numbers just on organic growth alone, which is awesome and that's why you see the numbers up at the level they are. I think Allan was just telling me before the call if you did the math out of the -- some of the filings we did, we get it somewhere in the 15%, 16% range for organic growth this past quarter. That's an excellent number. We've historically been 3% to 6% and to put up numbers in the mid-teens is excellent. We're pretty conservative operators of. As you've probably seen over the years, we always plan for the worst and hope for the best. We continue to plan to run our business to 10% to 15% EBITDA growth and that usually requires something like 4% to 6% organic growth. I don't know what's going to happen in the next year. A lot of it has to do with shipping volumes. I hope we do better than that. But for the moment that's -- when we do our budgeting and that's the way we plan to run the business and if we get more than that, that's great. We'll spend the extra on trying to make the company better for the long run. Justin Long: And just thinking about that 10% to 15% EBITDA growth target, it feels like the organic growth is accelerating and maybe some of this is sustainable based on the drivers that you mentioned earlier in the call. Any thoughts around that 50-50 split between organic growth and acquisition growth potentially changing, especially when you pair this with valuations in the market on acquisitions? Edward Ryan: Obviously, the 50-50 change is based on what's available for acquisition and how higher our organic growth is right now. The organic growth is pretty high, so -- and we've been doing fairly well on acquisitions as well. That 50-50 is probably more of a guide to give guys like you a sense of what we're planning on. Look, we buy what we think we should buy. That could be nothing. Next year, it could be 7 companies at. It just depends. If we see good stuff to buy, we're going to -- if we think we can make money for our shareholders in an acquisition, we're going to go do it. And none come along that meet our hurdle rates, we won't. I suspect the answer will be somewhere in between there. And we hope the organic growth continues at the clip it is. But I also -- there are no illusion that it will if the economy turns, it's probably going to go back to where it was before. And we want to be a safe investment no matter what happens. So, that's why we kind of run things conservatively and plan for good numbers. And if we get great numbers, that's even better. We'll put the extra money back into the business. And if we just get okay numbers, we're still going to do pretty well and meet everyone's expectation. So, that's what I expect without having a crystal ball to know what happens out in a couple of quarters with the economy. Operator: Our next question comes from Robert Young with Canaccord Genuity. Robert Young: This might be hard to answer, but I was curious if you could maybe give us a sense of any impact there might be from some of the U.S. legislation to regulate the container shipping industry? I guess that's new, but I'm just curious what impact, if any, positive or negative that might have on your business? Edward Ryan: Are you talking about the legislation they just started proposing with visibility? Robert Young: Just new. Edward Ryan: Yes, we were just -- I mean, it just came out a couple -- it came out a week or 2 ago and we were looking at it as well. I mean having followed legislation most of my career, we do a lot of government initiatives and things like that. With something this early stage, just want to think about, but the odds of it coming through are not great. It was a proposal to put -- to get everyone to give stuff to the Federal Maritime Commission to help them with visibility. I'd be surprised if it actually went that way. At the same time, it does kind of express what the market is interested in is, especially with what's going on here with the congestion in the port and stuff, this visibility is more important than ever. I think it's more likely to be solved by private companies, but we'll see. We continue to monitor it. If they actually want the system to do that, I think you'd see us there trying to find ways to help them. I think our network really helps people solve problems like this. And if the government want to help doing that, we would be happy to try and help solve the problem with them. I think more likely, it's going to be solved privately. Just more and more companies like ours are going to be there trying to collect information from all the various parties around the supply chain and share that information so that people know where stuff is so they can make better decisions. I think you're going to see us be right in the middle of, legislation or no legislation. Robert Young: I think there was a concern just on the rapid increase in prices on marine shipping pricing and maybe there was a step towards putting some regulatory framework around that? Edward Ryan: I mean my background came, 20 years ago, 25 years ago, came from providing rate management that the government has mandated and then over about a 10-year period, probably 15 years ago, they stopped collecting all those rates and -- they do a minor collection of it now that we're still involved in, but they used to have one database for all the rates in the United States and the shippers fought hard to get rid of that. I was reading that article with a couple of the other guys here in the executive team at Descartes and laughing and going because I knew the whole history of it going. These same shippers that are doing this though to get rid of that so that the largest shippers could negotiate lower rates and the carriers always said, hey, I can't give you that lower rate if I have to make those rates public. And so they got Congress 15 years ago to abolish this process. And now they're going, hey, wouldn't it be great if got each other's rates again and I was going, geez, you guys remember how that's all started. So, I don't know whether that's going to go forward or not. We continue to monitor it. If it did, we have great systems to be right in the thick of it. We have all these systems that help people database the rates. And if the government wanted to use one of those systems to, to make all the rates available, we'd be happy to try and participate in that. At the same time, I think it's going to be awfully hard for them to agree on a piece of legislation that's going to get all the way through the House and the Senate to allow them to do that, especially knowing just 15 years ago, maybe 20 years ago, they all thought to be rid of it. And now they'd be asking to get it back, that will be a head scratcher to me. Robert Young: To the second question, just on NetCHB, that seems to me to be a U.S. focused business and so I was curious about the international opportunity there. And there was an announcement with SEKO Logistics that seemed related to NetCHB. I don't know if I've read that incorrectly, that seemed pretty quickly on the back of that. And so I was wondering if that was connected if there was some context there? Edward Ryan: SACO is a big customer of ours, a big customer of NetCHB. We were happy when we bought NetCHB to bring them on as an even bigger customer. And I think with them and with a bunch of other NetCHB customers, we've already been in a lot of conversations about, hey, now that you're with Descartes there's a lot of other things we could do with you. And I think we're going to see that benefit us as we have in a lot of our acquisitions. One of the main drivers for our acquisitions is cross-selling and we continue to get better and better at it with each new acquisition and really leveraging our market size to go in and say, hey, there's a lot of stuff we can do for you. You guys should sit down and talk with us for a little while. And if customer, a fairly large customer of ours, they usually say yes to that. Whether they buy something or not, they say, yes, we should talk about that, and we'll go in and do it. And a lot of times, something shakes off the tree. Operator: Our next question comes from Nick Agostino with Laurentian Bank. Okay. Our next question comes from Howard Leung with Veritas Investment. Howard Leung: I want to first ask about the -- is it fair to say, I guess, in terms of thinking about the Ukraine conflict in short term, as you mentioned, there's a lot of complexity even with the sanctions and potential tariffs. So, that's benefiting some of Descartes -- some of the Descartes' customers and driving their demand for some of the Descartes' solutions. But the longer the conflict drags on or escalates if that negatively impacts trade volumes, that could be a concern from Descartes' business perspective? Edward Ryan: Yes, possibly. I mean, if I think of all the -- all the issues related to the Ukraine-Russia conflict right now, there's a bunch of different areas that potentially impact us. We have our direct customers in those regions, which there are -- we don't have a ton of direct customers in Russia and the Ukraine to begin with, a handful of customers, amount of money on our network that's insignificant. We have issues -- internal issues, Descartes team members that are located in those regions and we're spending time to get them -- either get them to safety or get them to other countries in the region where we do business where they can be safe. We have suppliers, the potential for suppliers to be there, we have very few. So, that's really not a significant issue for us. We have global shipments, which I think you're mostly focused on global shipments in and out of the region of Ukraine-Russia and oddly or maybe because of some of the sanctions that are already in place, there's not a ton of volume on our network coming out of Russia and the Ukraine. There's some, but again, a relatively minor impact and a lot of those shipments might just move to other parts of the world as well. So, that's the part we have to see. And then you have the part you mentioned a minute ago, which is the sanctioned parties and the tariffs and duty changes, which we think is a real opportunity for us as a whole lot more sanctions go in place and tariffs and duties change as a result of this. That's why people use our databases. So, that's an opportunity for us. And then most broadly is what impact does this have on the economy. And that's the part where it's a little harder for us to see. How big an impact does this have on the global economy. And I don't know the answer to that question yet. My gut would be not massive right now, but you got to see where this conflict goes, whether people get involved, it's spread to other parts of the world. I hope none of that happens. But if it does, the impact on the world's economy could be bigger than it looks right now. And if it is, that will impact us like everybody else. Howard Leung: Thanks for breaking that all down. And it's -- there's a lot of moving parts. I guess suffice to say that if -- right, it's been so early that even now with your renegotiations with your existing customers, you're not really seeing that come up yet, right, I would think? Edward Ryan: No. And I wouldn't expect it to come up in renegotiations. I remember most of our contracts already renewed. So, there's not -- we don't spend a whole lot of our time renegotiating contracts. And if we did right now, I wouldn't be banking on anything from that in a renegotiation. Customers usually trying to -- right now, they're raising their volumes in any discussion that we're having because they want to get -- they have more volume, they want to get lower rates. And as a result, they're committing to higher minimums, which is the kind of stuff we see going on today because of what's happened over the past 1.5 years, and I think the customers think, hey, I'm at higher volumes now I can get lower rates if I commit to them. So, that's -- in any discussion we have about prices. That's probably the leading driver at the moment. Howard Leung: And hope all your team members you're able to keep safe. I guess turning to the -- turning to the annual -- the geographic breakdown of the revenues, obviously, EMEA had its -- the growth was really -- was pretty impressive. When I look at the U.S. and the Canada growth due and kind of the disclosure there about the incremental growth of new interesting customers, how much of that growth for you in Canada was from Brexit if at all? And can you just speak to some of the other main drivers in fiscal '22? Edward Ryan: Allan can jump in here and correct me if I'm wrong, but I believe most of that Brexit revenue is in the EMEA region. And one of the drivers behind the large growth in the EMEA region last year was that Brexit initiative. And there may be some that's coming out of the U.S., but the vast majority is going to be in the U.K. and Europe. Allan Brett: Yes. Yes. Howard, that's right. It's -- the Brexit-related stuff is in EMEA. The rest of the growth you're seeing in Canada, U.S., other parts is the rest of our business. And the things that Ed mentioned earlier in the call, the other parts of our business that are going well as well as just the strength of the overall economy. Howard Leung: And just maybe one more for Allan. I might have missed it, but do you have the FX impact to revenues for the quarter? Allan Brett: Yes, it's fairly minor. There's about $1 million headwind to revenues Q4 over Q4 and about $1 million decrease to operating expenses as well. So, really no big impact on EBITDA up at about $1 million or so to a negative to revenues in Q4. Operator: And at this time, we have no further questions. Turning the call back over to Mr. Ryan for any final remarks. Edward Ryan: Great. Thanks, operator. Thanks, everyone, for joining us on today's call. We look forward to reporting to you in a few months on our Q1 results. Have a great evening. Thanks. Operator: Thank you, ladies and gentlemen. This concludes today's conference call. Thank you for participating. You may now disconnect.