Good day, ladies and gentlemen, and welcome to the Second Quarter 2012 Liquidity Services, Inc. Earnings Conference Call. My name is Keith, and I'll be your operator for today. [Operator Instructions] As a reminder, today's conference is being recorded for replay purposes. And I would now like to turn the conference over to your host for today, Ms. Julie Davis, Director of Investor Relations. Please go ahead.

Thank you, Keith. Hello, and welcome to our second quarter fiscal year 2012 financial results conference call. Joining us today are Bill Angrick, our Chairman and Chief Executive Officer; and Jim Rallo, our Chief Financial Officer and Treasurer. We will be available for questions after our prepared remarks. The following discussion or responses to your questions reflects management's views as of today, May 3, 2012, and will include forward-looking statements. Actual results may differ materially. Additional information about factors that could potentially impact our financial results is included in today's press release and in our filings with the SEC, including our most recent Annual Report on Form 10-K. As you listen to today's call, we encourage you to have our press release in front of you, which includes our financial results, as well as metrics and commentary on the quarter. During this call, we will discuss certain non-GAAP financial measures. In our press release and our filings with the SEC, each of which is posted on our website, you will find additional disclosures regarding these non-GAAP measures, including reconciliations of these measures with comparable GAAP measures. We also use certain supplemental operating data as a measure of certain components of operating performance, which we also believe is useful for management and investors. The supplemental operating data includes Gross Merchandise Volume and should not be considered as substitute for or superior to GAAP results. At this time, I'd like to turn the presentation over to our CEO, Bill Angrick.

Thank you, Julie. Good morning, and welcome to our Q2 earnings call. I'll begin this session by reviewing our Q2 financial performance. Next, I will turn it over to Jim Rallo for more details on the quarter and on our outlook for fiscal year 2012. Finally, I will provide context on where we stand in our company's overall development. During Q2, Liquidity Services reported very strong financial results as we expanded our share and leadership position in the reverse supply chain market by delivering significant value to our clients and buying customers. We exceeded our guidance range for GMV, adjusted EBITDA and adjusted EPS while continuing to make important investments for the future. Q2 GMV was up 59% year-over-year to $218.4 million, driven by growth in the volume of goods in our retail supply chain and government marketplaces by existing and new clients. Adjusted EBITDA of $30.9 million was up 120% year-over-year. And adjusted EPS during Q2 was $0.52, up 136% year-over-year, driven by improved operating leverage on higher volumes. During the quarter, we expanded our market share within both the commercial and public sector markets. Our value proposition is resonating with retailers, manufacturers and public sector agencies, which is reinforcing our network effect and resulting in new client wins in the reverse supply chain market. Our team has done an excellent job handling the increased volumes while maintaining a high level of service and quality to our clients and buying customers. Our consistent execution has enabled Liquidity Services to become the trusted provider of choice in our industry with over 50 Fortune 500 corporations; over 4,500 federal, state and local government agencies; and over 1.7 million registered buyers utilizing our marketplaces. We also demonstrated during Q2 that we can convert our top line growth into strong cash flows. Q2 operating cash flow was a record $26.4 million, up 178% year-over-year, and we exited the quarter with nearly $105 million in cash. We are pleased to report that our overall progress has generated strong financial results for our shareholders, exemplified by our adjusted EBITDA of $81.2 million and our operating cash flow of $62.2 million over the last 12 months. By continuing to invest in growing our e-commerce business, we intend to capture a significant share of the highly fragmented $75-billion reverse supply chain market, while having a positive impact on our clients' financial and environmental sustainability initiatives. Now let me turn it over to Jim for a more detailed review of our financial results and our outlook for the full year fiscal 2012.

Thanks, Bill. Our record second quarter results reflect market share gains and enhanced service levels and operating efficiencies across our entire business as a result of investments we have made to support our growth over the last several years. Our strategy of bringing innovative technology to the reverse supply chain market and our efficient business model has translated into strong results for stockholders. Our seller base has continued to grow as corporations and public sector agencies focus on reducing costs, improving transparency and working capital flows by outsourcing reverse supply chain activities. As corporations and public sector agencies increasingly prefer service providers with a proven track record, innovative technology solutions and demonstrated financial strength, we have continued to penetrate our large, highly fragmented markets. We continue to implement the Jacobs Trading acquisition according to our original plan. The network effect of the integration is creating efficiencies for our selling and buying customers. These efficiencies continue to bring new sellers into our marketplace and have enabled us to increase our operating performance, creating margin improvements as we scale our commercial business. As we improve operating efficiencies and service levels, we expect our competitive position to strengthen. Our strong results for the quarter were driven by record volumes in both our retail supply chain group, which has its seasonal high in the second quarter, and public sector verticals. We implemented several new programs during the quarter, which ramped up faster than anticipated, driving acceleration in Gross Merchandise Volume or GMV during the quarter. Next, I will comment on our second quarter financial results, which came in above our guidance ranges. Total GMV increased to a record $218.4 million, up 58.6% year-over-year. GMV in our commercial marketplaces increased to a record $128.2 million, up 112.1% year-over-year as a result of the strong performance…

Thanks, Jim. As we reflect on our strong Q2 results, let me make a few observations on the macro trends affecting our business and our role in light of these trends. In a low-growth global economy, commercial and government agencies of all sizes will continue to focus on solutions that drive efficiencies. Liquidity Services provides the most efficient solution in the reverse supply chain and enables clients to reduce operating costs, maximize financial recovery and free up space and human resources to redeploy into their core business. The $75-billion reverse supply chain market and asset recovery process will move online, just as other business functions have, to capture efficiencies, transparency and better value. This transition is going to be big and global, and it's still in the early stages. As the market leader, Liquidity Services will provide the expertise, marketplace platform and services to accelerate this trend. In the reverse supply chain, the world's largest corporations and public sector agencies will seek financially strong, innovative service providers that: one, cover the full range of products used in their business footprint and supply chains; two, support all geographic regions where they conduct business; three, are secure and compliant with all local, federal and international laws; and finally, that integrate with their IT and financial infrastructure to improve the disposition process. Liquidity Services uniquely meets all of these needs. At the beginning of fiscal '12, we established a long-term goal of tripling our business to $1.5 billion of GMV and $150 million of EBITDA. We are pleased to report that we are well on our way to achieving these objectives. Our team has the passion to improve our business every day and deliver innovative solutions that transform the global reverse supply chain. Our entire team looks forward to continuing to significantly grow our business while maintaining the highest standards of integrity, service and quality to our clients and buying customers. Thanks for your attention, and we'll now open up the call to questions.

[Operator Instructions] And your first question is from the line of Ross Sandler with RBC Capital Markets.

Just a couple of questions here. First is on international. So it looks like you guys might be dipping your toes back into the international waters. Can you talk about how DoveBid, if this ends up happening, would be a better approach than your previous U.K. endeavor? And then second, on the commercial business, can you just give us a little bit more color on where the strength is coming from? Is it -- you mentioned core retail, but is Jacobs, eBay or all of the above kind of contributing in the March quarter? And then I've got one follow-up.

Sure. One, I will confirm that as noted in our 8-K release recently, we have had discussions with GoIndustry-DoveBid. Those are in advanced discussions. The U.K. takeover panel and rules preclude us for making specific comments about that business. What I will say is that our stated growth strategy obviously has included acquisitions, but more importantly, our strategic plan recognizes that our Fortune 500 client roster, our multinational companies, they are seeking uniformly high levels of service, not just in the United States but in other major economic hubs in Europe and Asia. And they're seeking strong asset management and disposition partners with all of the transparency; depth of service; and in our case, online auction marketplaces that match client assets with the world's largest base of qualified buyers for these assets. So those are trends that naturally will take us outside the United States over time. And whether we build or buy these various capabilities over time, clearly this is addressing the needs of the client, which is why it's a sound expansion strategy. And we believe that as we've demonstrated over time, we're very good at refining and relentlessly improving our operations, so that when we do make such investments, they'll drive high returns for owners and clients.

On the second part, Ross, the strength in the retail, not really specific to Jacobs. Actually, a lot of it was new programs this quarter. So again, back in my comments I made earlier on the call, we had a couple of new clients that ramped up this quarter. That ramp was quicker than we expected. You've been with us for a while and you know that as we roll out clients, I would tell you that typically, they tend to overpromise volumes, and I would tell you this time that those volumes actually came in above their own expectations, which was significantly above expectations. So a fair number of new programs going on with some large multinational companies and that really drove the acceleration through the quarter, as you saw.

Okay. And then just one last question. The full year guidance assumes the 13% EBITDA to GMV margin and, Jim, I know you stated that you think you're kind of running at optimal margin levels compared to some your e-commerce peers. But as the business continues to scale and as these network effects kick in, if you look out like 3 to 5 years, where do you think that margin could go?

Thanks, Rob. Again, I think that we continue to get scale efficiencies. I do believe that over the long term, our margins are not going to improve significantly from where they are today. As we know that we have significantly higher margins than most of our clients, I think it's a reasonable expectation that over time, we have to share more of those with our clients. Also, you have to understand the mix of business, too. So as our mix of business changes from -- more to a consignment model, if we have higher levels of capital assets under the consignment model, that margin just mathematically goes down, Ross. So I think that the margin will bounce around a little bit from quarter-to-quarter. I do believe that we can maintain the solid margins we have, but I do not expect to see continued improvement like we have at the pace over the last 18 months.

Your next question is from the line of Jason Helfstein with Oppenheimer.

Can you give us an update on Jacobs? Has that been tracking to plan? And then if we kind of stated that organic GMV in commercial purchase was up about mid-teens, kind of in other words stripping out Jacobs, would that generally be consistent? That's question #1. Question #2, you talked just about not paying the earnout for TruckCenter in the release. Just looking for some color, kind of what happened there and if you just want to talk about why that didn't hit kind of that expectation? And then just going back to the commercial consignment, specifically the capital assets, would you cite the capital assets being more of the driver of the strength in the quarter than any retail business flowing through that?

Sure. Let me address how Jacobs has supported our growth strategy. We indicated at the time of that transaction, we were making a move to increase the size and scale of our presence in the retail supply chain. And the team that we added has performed very, very well. We've shared quite a bit of information on ways that we can continue to develop this marketplace. And we essentially have another set of relationships to further penetrate and bring into this marketplace. I think the real opportunity for us is to continue to be an ambassador for articulating to manufacturers and suppliers to the retail supply chain, there's a lot of value to be realized by moving their goods through our online channel and recovering financial value. There are significant volumes of goods that are returned from retailers back to the vendors that are transported 1, 2, or even 3 times, which is a deadweight loss to these vendors. And we're having success, great success, identifying those large manufacturers and having them introduce these return-to-vendor goods into our marketplace. And that's something that will continue to be a theme, I believe, as we continue to grow over the next decade. So we're very excited about that, and we appreciate all the support that we've gotten not only through the Jacobs team, but broadly in our retail supply chain group, which frankly is one of the continuing growth opportunities and drivers coming out of Q2. That retail supply chain business and volume, as I mentioned in the macro trends, it's undergoing a lot of focus on driving additional efficiencies. Liquidity Services continues to be the logical partner to help those clients free up space in the retail store shelves, in their warehouse, and offload those goods through our channel. We can recover the value expediently. We have multiple marketplaces that bring the maximum recovery for these assets. We've reduced transportation costs. We're adding value on items that typically have been viewed as almost scrap in nature. So there's a lot of additional growth in the retail business. And that frankly was, as I mentioned in the initial remarks and in our press release, one of the key drivers of Q2.

Yes, let me take the last 2 questions, Jason. I think one on TruckCenter, again, the earnout write-off of the liability, which caused the, what I'll say, unusual income in our P&L, which again we adjusted for, is really the result of the accounting rules. Due to the change in M&A accounting, you're required to make estimates at the time of the transaction, what you think that earnout will be over time, and then adjust those estimates. So we relied in frankly, through negotiations of what the value of the business was worth. We paid a fair value at that business at the time of the deal. The seller wanted significantly more value and we put together an earnout as part of that transaction based on the seller's expectations of growth. And that growth was significant to meet those earnouts and that's just not coming to fruition. So I think, we're not -- we're certainly not unhappy or displeased with the performance at TruckCenter at this point. But from an accounting standpoint, it's not performing to the level as, I'll say, advertised by the seller to meet the earnout. As far as where the growth is coming on the commercial side of the business, Jason, actually growth did not come -- it was not driven by the capital assets this quarter. As indicated on our last earnings call, this is a seasonally low quarter for capital assets because most of our clients are 12/31 year end in that category. And so they move a lot of product towards the end of their fiscal year, meaning our first quarter. We had a very high last quarter if you remember. So this growth was all driven by the retail side of our commercial business and we're not commenting specifically on individual growth rates, but I would tell you, your 19% number is definitely low by more than twofold, the organic growth experienced in the retail supply chain group this quarter.

So just following up. So the -- I'm looking specifically though at the purchase side, right, because Jacobs all flows through purchase? So I'm just trying, just kind of thinking about that, the $59 million of GMV and then stripping out kind of Jacobs, what that would -- that -- just that piece. So that's how I got to the 15. But I mean, just to kind of go further, so basically what we're seeing obviously is this quarter, there was a relatively large influx of retail into the consignment model. I mean, can you talk about maybe the trends that you're seeing between retail fluctuating between consignment and purchase model? And kind of why you're seeing kind of the different trends?

Yes, let's just discuss -- the value proposition is, we're going to drive efficiencies and capture information, move these products to the logical marketplace using the data that we have accumulated over 3 million completed auction transactions to improve merchandising and value. Our clients operate in many business contexts, many settings. Some have centralized decision-making and technology and financial accounting systems. Others are decentralized. And so we provide a menu of services. We provide a menu of pricing models and we'll allow the client to configure the service that best matches their needs, rather than dictate to the client what they should use. And so in some instances, a consignment model is preferred, in which case, we allow them to share the maximum amount of revenue on the upside and take a fee. And we're agnostic to that. And the margin discussion may be missing the point because we make decisions based on what drives the appropriate return on invested capital, return on investment of effort to drive results. And whether you measure our EBITDA as a percentage of GAAP revenue, or EBITDA as a percentage of GMV, we're driving operating cash flows over time in our business. And I think that's why we commented on it every quarter. That ultimately is benefiting the client and drives our economic model. In other cases, clients might want to have the ability to issue an invoice to maintain integrity of their financial record-keeping before letting inventory leave their warehouse or retail store. And that's fine as well. We'll take possession of the inventory, record that purchase, and in many instances, above a certain strike price we share revenue back to the client, so it has elements of a profit-sharing model. So we provide the full range of pricing models because our clients are very unique. They have their own cultures. In many [ph] cases they are very large companies. And it would be, in our view, inappropriate to believe that we could dictate a uniform or monolithic pricing to all of the players in the Fortune 500 supply chain.

So just to follow up then, and I'll let somebody else go. So would you say that because you can offer that type of flexibility, because of your size and scale now that, that's become a significant advantage, competitive advantage for the company?

Yes, absolutely. I think these large companies are not looking to have someone who is inexperienced in taking on massive flows of goods. I mean, if you look at the consequences of someone underperforming and not able to remove goods from a truck door in a high-performance distribution center, the consequence to their core business is tremendous. So having a financially strong asset management partner with the proven ability to handle the pre- and post-sale logistics, very, very important.

Your next question is from the line of Colin Sebastian with Robert W. Baird.

Bill, I guess first off, turning back to your comments on the macro environment providing a boost to the business. I'm wondering how much of that you see as being a broad market-related tailwind. And then how much is really a sustainable step function for the platform in terms of sellers and volume? And then secondly, Jim, it looks like the business overall is sort of on track here to generate around $1 billion in GMV next fiscal year. You've been able to show some great leverage with cost control, but related to your comment on margins earlier, I'm just wondering if -- does the platform have the scale and flexibility with all the different websites to support this level of growth? Are you anticipating perhaps some investments in new platform technology? Or maybe you can just clarify some of that.

Well, first, let me address macro trends. We obviously had a strong belief in where the world was going to start this business almost 13 years ago. And at one point, I used to buy CDs. I'm sure you used to buy CDs. There aren't many CDs sold today. And if there's any question that the world is going digital, that the world is going to efficient solutions that in many cases are enabled by technology, that is the central thesis around our business model. And it's no -- there's no question in my mind that global corporations, as well as the middle market and small businesses, are taking advantage of marketplaces that provide that size and scale to connect and conduct commerce. And there's no doubt in my mind that 5 years from now, 10 years from now, there'll be many, many more companies using our solution than today. And there'll be many, many more small businesses buying on our marketplace because that's where the world is going, and we're positioned to benefit from those trends. And there's just an elegant solution when you have information captured from each transaction that you can reinvest that intelligence to advise your clients, to make it easier for buyers. We provide the broadest range of products in one marketplace. So from a desktop or a tablet, I can transact commerce and capturing in one marketplace my purchasing needs. For sellers, we're providing reliable, transparent, trusted services, in which case they can outsource this distraction to their core business. And in effect, we're reducing the friction of the reverse supply chain for both sellers and buyers by using this technology, by using integrated value-added services. And that's what's helping us elevate the business each and every year. And yes, we believe it's sustainable. Yes, we believe it's global, and we think it's going to be big.

Colin, the second part of your question, as far as the infrastructure and investments and our ability to scale the business, as you know, you've been with us for a long time, we have made significant infrastructure investments over the last 2 years and continue to do those this year. And we've got some of the biggest projects we've ever undertaken as a company going on this year to incorporate all the different marketplaces, make it unified for our buyer base. We've got projects going on to enhance our video performance, to make it easier for mobile users, as Bill indicated before. He mentioned tablets, but we're also rolling out projects that will affect people or give them the ability to basically use their smartphones. So again, we're -- this company was founded on innovation. We continue to invest in that innovation. And we certainly have no issues right now or concerns that we'll be able to handle $1 billion of GMV if we hit that number next year.

And then just lastly, I'll sneak one in. Did you mention the number of sellers earlier in the call? I may have missed that. And if not, could you at least talk perhaps in general terms about the growth in the seller base? We have the other key operating metrics, obviously, from the release.

Sure. So I think where we've seen some significant growth in the seller base has been around the Fortune 500. So we rolled out a couple new programs this quarter for some very large companies. That drove a lot of the retail supply chain growth. We continue to make improvements in penetrating the state and local government markets. We're working with a little over 4,500 state and local government clients. As a reminder there's 60,000 to 70,000 townships, municipalities, counties and so forth around the country. So we've got a long way to go before we reach any penetration. Our strategy is really to try to gather the Fortune 1000, provide services and improve their efficiencies in the reverse supply chain through our innovative marketplaces around the world. And we would expect to continue to grow that client base over the coming quarters.

Your next question is from the line of Shawn Milne with Janney Capital Markets.

I just want to go back to -- I mean, everyone has asked about the strength in retail. Sort of the organic number we're seeing, Jim, would indicate much, much stronger numbers. Is there anything onetime in nature with some of these new programs at retail? I know one of your bigger partners might be moving some liquidated product right now. Was that impacting it? Or is this just a sign of more retail programs to come, and we should expect organic growth -- or organic growth on top of that next year? And then on the capacity side, I know you said you have some infrastructure investments going in. Are we okay from a distribution footprint? Then in capacity there, your CapEx remains very low. Just color on those.

Sure. Well, Shawn, as far as any onetime effects, we did not have any onetime effects this quarter. I would remind everybody that this is a seasonally high quarter for the retail supply chain part of our business. We will expect that business to sequentially go down in the next quarter. And then in the fourth quarter, maybe a slight decline or flat from the third quarter. That's just sort of the rhythm of the retail supply chain as we all know. Obviously, we expect to have growth next year over this year. We're not formally giving guidance on next fiscal year yet. But again, as we roll out with some of these larger clients, Shawn, there will be times when you get a, what I would say, accelerated organic growth cycle for a period of time. And then we may normalize that cycle. And so a couple of other large clients come on. As we get bigger, I think that effect will be muted some, but we certainly experienced that this quarter. As far as our distribution center network capacity, we're certainly running under capacity today. I would tell you that this quarter is, again, our high quarter for the year, and so we were getting close to 70%, 75% capacity in many of our centers. As a reminder, we're currently only running one shift. We have, in the past, run 2 shifts in a couple of our centers. So we've got that experience. We certainly feel we can double the business with our current distribution center network. Now whether we add centers, that's really going to be driven by our clients. I mean, we continue to look for ways to enhance our customer service with our sellers. And if they're certainly going to need -- we'll address that at the time. But right now, we feel confident in the capacity of our current network.

Your next question is from the line of Jordan Rohan with Stifel, Nicolaus.

A couple of one-off questions and one big strategy question. So the one-off question. How big a factor are tablets, iPads, Kindle Fires, whatever in the category, as a driver of this upside? You did refer to a couple of direct-to-manufacturer relationships. I'm wondering if some of those happen to be in the consumer electronic/tablet area? Second, key factor, key question. Over time, historically, you had said that the growth of this business was aided more by the growth in registered buyers, which were up 13.5% this quarter, but your GMV is up 58%, 59%. So clearly, it shifts or has shifted a little bit over to the demand side -- or excuse me, to the supply side, where you have a couple of big retailers or manufacturers that are really starting to drive higher revenue per buyer. Do you agree with this, directionally, that growth in registered buyers is no longer the key determinant or gating factor of your growth?

So first, on the second question. You have a 2-sided marketplace and you will go through different phases of development, in which case, you need to build up a demand side to invite credible large sellers to transact in that marketplace. So this is a "chicken and the egg" problem. And I'd say you're dependent upon the nature of the marketplace. That could take decades or years to resolve, but we've transcended that issue, Jordan. We have outstanding liquidity in over 500 commodity categories with our buyer base. And therefore, the supply side is very excited by the nature of our solution, the ability to absorb large volumes. And the brand reputation that we've developed is such that buyers feel very comfortable that when they spend thousands or millions of dollars in our marketplace, they're going to have a reliable experience with a trusted marketplace, with convenient payment solutions, with turnkey logistics support. So we feel very, very good about the buyer side and we continue to build our portfolio of sellers, and we think we've transcended that sort of "chicken and the egg" problem in the marketplace and are now benefiting from that. I'd also remind you on the first question, that our marketplace benefits from this inexorable march of Moore's Law and new innovation and the disruption that occurs in retail, in consumer electronics channels. When there is a new version of a tablet device or a laptop or a PDA or handheld device, that creates significant need on the part of manufacturers and retailers to efficiently dispose of these products while pivoting to the next technology life cycle, and that's what we do so well. And we have benefited from products flowing for many years in the consumer electronics channel into our marketplace, and that was the case in the last quarter. I wouldn't say that a large volume of tablets, specifically, drove any of our outperformance this past quarter. It's always been part of the mix. But nothing out of the ordinary there.

Okay. Now a couple Decembers ago, you were able to see that there was heavy discounting in consumer electronics at the retail level, and that made it a little bit harder for you guys to get the normal spread or margin. I assume that, that dynamic, with regard to merchandise being discounted on the retailers' floor, I think that's probably gone away to some degree because your margin seemed to have -- your gross margin seemed to have been pretty good. Do you agree with that assessment, that we're in a better spot, that retailers are not willing to mark down on the showroom floor and more likely to push it into reverse supply chain earlier?

I think many clients look back at the fall of 2008 as a lesson learned that goes into the playbook. There is nothing good that comes from retailers pulling forward sales at 70%, 80%, 90% off in the store. And you've heard from all the large retailers that they don't want to be showrooms anymore. They don't want to be viewed as extreme liquidation or discount channels. They're much more disciplined around pricing. And so we don't see today the environment that we had in the financial downturn of 2008 and 2009.

[Operator Instructions] You have a follow-up from the line of Jason Helfstein with Oppenheimer.

Just one more. Can you just give us an update on general thoughts for acquisition pipeline for the rest of this year, for next year as the company gets bigger? Presumably you want to -- doing bigger acquisitions. Does it get harder to find bigger acquisitions? Or you have to do more smaller acquisitions to kind of have the same incremental effect each year?

Well, we've had a 3-pronged growth strategy for the -- since the inception of the company, organic innovation in terms of building products and services to support the marketplace and external growth. And when you come to external growth in the M&A area, it's really quality not quantity that makes the difference. And so when we look at the filter, we're looking for a culture that fits with our view of where the macro trends are and where the world is going. We're looking for highly professional teams that have knowledge and expertise that's relevant to our marketplace. And we talked about how we see the world's largest corporations and government agencies seeking these providers and solutions that truly do cover the full range of products and their business footprint, supply chain, and that support them in all geographic regions where they conduct business. And so I think those are ideas that will drive our review of potential add-on acquisitions or potential organic investments. We have, I think, a very experienced team that evaluates partnerships and M&A opportunities, and we're very disciplined on that side. And so it's really the focus of -- not any number prescription for growth through external avenues but just is, it driving the business strategy? Is it adding the knowledge and expertise? Would we go out and hire the same team that we would encounter in the acquisitions scenario? If the answers are yes, and it supports one or more of these strategic growth drivers, then it's likely to fall into our pipeline. And then I think over time, we've shown that we've been able to onboard acquisitions in a way that adds value to our clients and ultimately to shareholders.

And ladies and gentlemen, that will conclude today's Q&A session. I'd like to turn it back over to Ms. Davis for closing remarks.

Sure. Thank you for joining our call this morning. As always, Jim Rallo and myself are available for follow-up. Thank you, and have a good afternoon.

All right. Ladies and gentlemen, that will conclude today's conference. Thanks for joining us, and you may now disconnect. Everybody have a great day.