Good afternoon and welcome to the Paycom Fourth Quarter Year-End 2015 Earnings Conference Call. All participants will be in a listen-only mode. [Operator Instructions] After today’s presentation there will be an opportunity to ask questions. [Operator Instructions] Please also note, this event is being recorded. I would now like to turn the conference call over to Craig Boelte, Chief Financial Officer. Please go ahead.

Thank you, and good afternoon. Before we get started, I would like to note that certain statements made during this conference call that are not historical facts, including those regarding our future plans, objectives and expected performance are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements represent our outlook only as of the date of this conference call. While we believe any forward-looking statements we have made are reasonable, actual results could differ materially, because the statements are based on our current expectations and are subject to risks and uncertainties. These risks and uncertainties are discussed in our filings with the Securities and Exchange Commission including our annual report on Form 10-K for the year ended December 31, 2014, and our quarterly report on Form 10-Q for the quarter ended September 30, 2015. You should refer to these and consider these factors when relying on such forward-looking information. Any forward-looking statements speak only as of the date on which it is made and we do not undertake and expressly disclaim any obligation to update or alter our forward-looking statements, whether as a result of new information, future events or otherwise except as required by applicable law. Also, during the course of today’s call, we will refer to certain non-GAAP financial measures. A reconciliation showing GAAP versus non-GAAP results is included in the press release that we issued after the close of the market today, which is available on our website at investors.paycom.com. I will now turn the call over to Chad Richison, Paycom’s President and Chief Executive Officer.

Thanks, Craig and thank you everyone joining us on today’s call. I am very pleased to welcome everyone today for our fourth quarter and full-year 2015 earnings call. We had an excellent fourth quarter, which capped an outstanding year. 2015 was our first full-year, as a public company and Paycom enjoyed continued success with our full-year revenue growth accelerating over 2014. Before I begin the discussion of our results, I want to take a moment to express how proud I am of our team. Our success is a direct result of their hard work and efforts. Additionally, I would like to thank our clients for allowing us to serve them. We are committed to providing the very best payroll and human capital management services to our clients and we are honored every day that they have selected Paycom to help them meet the needs of their business. We will look forward to continued success. Now I’ll turn to our results for the fourth quarter and full-year of 2015. As we announced in our press release earlier today, Paycom enjoyed continued momentum in the fourth quarter of 2015. Our revenue for the fourth quarter of 2015 was $65.1 million, representing growth of 48%, compared to the comparable prior year period. As a reminder, the fourth quarter was our best quarter in 2014 and therefore was our toughest comparable for the year. So I am particularly proud of this performance. Revenue for the full-year of 2015 was $224.7 million, which represents growth of 49% over 2014. Our retention rate was at least 91% for the fifth year in a row. This milestone underscores our high level of client satisfaction. Craig will go through our financials in detail, later on the call. But I wanted to take a moment to highlight our adjusted…

Thanks, Chad. Before I review our fourth quarter results and also our outlook for the first quarter and fiscal year 2016, I would like to remind everyone that my comments related to certain financial measures will be on a non-GAAP basis. Adjusted EBITDA and non-GAAP net income or non-GAAP financial measures that exclude stock-based compensation and other non-recurring charges including transaction expenses relating to our initial public offering and our follow-on public offering. A reconciliation of our GAAP to non-GAAP results is included in our press release. Our fourth quarter was robust with total revenues of $65.1 million representing year-over-year growth of 48% from the comparable prior year period. For the full year 2015, total revenue was $224.7 million, representing growth of 49% over 2014. Within total revenues, recurring revenue was $63.6 million for the fourth quarter of 2015 representing 98% of total revenues for the quarter and growing 47% from the comparable prior year period. For the full year 2015, total recurring revenue was $220 million, representing growth of 48% over the comparable prior year period. ANRR was $40.6 million for the fourth quarter of 2015, compared to $20.6 million in the same period last year representing growth of 97%. Because of the demand for our ACA solution, we had a substantial number of clients implement our solution in the fourth quarter that we believe would normally have launched our solution in January of this year. Therefore, we estimate approximately 25% or $10 million of our fourth quarter ANRR was pull-forward into the fourth quarter with the majority of these transactions occurring during December. Without this contribution, we estimate ANRR would have been approximately $30.6 million and would have represented nearly 48% growth over the comparable prior year period. Total adjusted gross profit for the fourth quarter was $55…

Thank you. We will now begin the question-and-answer session. [Operator Instructions] Our first question is from Michael Nemeroff at Credit Suisse.

Hi, guys. Can you hear me?

Yes.

Nice quarter. Unfortunately your stock is, one of the many that aren’t probably full reflecting the – the really strong prospects of the next couple of years but hopefully that will work itself out over time. Just a question, because based on the number of new offices that you’re opening. Because you’re not significantly increasing the number of new offices in 2016, six over five. I’m just trying to figure out what kind of productivity increases that you’re building into your forecast to keep the growth rate pretty high over the next couple of years and in 2017 when the new offices in 2016 start to really effect the numbers?

Yes. And so thanks, Mike. So we have continued to increase the amount that anyone executive sales rep can sell as well as sales team. I don’t know that we hit a ceiling yet on how much a team can sell, I mean, I’ve talked about this in the past time. We continue to increase from $3 million to $6 million and we continue on for anyone sitting. So, we’re definitely increasing the productivity and how we’re doing that is by selling more deals, selling larger deals and then of course selling more modules into each client.

And then also, Chad, on the ANRR, I know it’s not a perfect proxy for bookings in the quarter and if you look at what you did in the second half of 2015, I mean that is truly remarkable over 100% in Q3 and over 90% in Q4. Just trying to level set, because we’re going to build the models and investors can have some expectations for 2016. Where would you think, where would you like the expectation to be for the ANRR growth, given the phenomenal growth in that number, and that figure in the back half of 2015 and 2016?

Well, as we’ve discussed in the past, I mean would you not give guidance as to the ANRR number, we are providing revenue guidance. ANRR as you know does turn into revenue. So we do expect the ANRR to be a strong moving forward. So I will probably stop with that.

And just lastly for Chad, the EBITDA guidance – implied EBITDA guidance for Q1, the strongest it’s ever been. I’m just curious where we – which line items we see the most leverage in Q1?

Well, we are heading into Q1 off of a strong year and as everyone is aware, I mean our revenues recurring, I mean 98% of our revenues recurring, so we bring that in to the year with us and into first quarter. So we are expecting a first quarter, Craig you can talk more to the leverage on that.

Yes, in the first quarter we will see a slight amount more of the seasonality than we have in the past, because of the 1094 and 1095 filings. And then also the sales and marketing the way we ourselves marketing year starts over on February 1, we see that ramp up throughout the year, those commission expenses.

And so we do commission sales people more based on how much they sell and our year starts over beginning February 1. So naturally commission rates are going to be lower in the back half of the first quarter.

Got it. Thanks guys. Congratulations on a great quarter and a fantastic year.

Thanks Michael.

Thank you.

The next question is from John DiFucci at Jefferies.

Thank you. Chad, I know you don’t forecast ANRR, you probably you do – you don't tell us that provide guidance for it. But you did say or Craig said that there were some ANRR that was pulled forward and that was part of the reason why it was so strong this quarter and it was strong really strong the quarter before. Craig can you remind us or Chad – I didn't catch as to why that pull forward happened this quarter. And I guess, more could be implied is that next quarter we’d see a significant moderation in the growth rate of ANRR, because of that. Should that be our conclusion with that and without giving us guidance on ANRR?

Yes, I mean obviously we are still in the middle of the quarter and ANRR is a calculated commission amount based on starts, which is why it’s really and not something that we guide on, because it’s based on when a deal starts. Back to your original question on the reason why we saw the pull forward, ACA obviously is something that it’s real and it’s here this year. And so in order for us to perform the task for a client that’s needed, for them to be compliant with ACA, they had to onboard with us in 2015. It’s been our business that we bring clients on and we will actually provide them year-end services, provided that they are with us for the month of December. And so that require deals that would have most likely started in January as indicated by what would be normal for us in past years. Those deals started early and they started at the end of December, as we went through and we estimated that amount we came up with approximately 25% of the ANRR that we had our deals that pulled into fourth quarter as it relates to ANRR.

Okay. And then well, I guess we’ll just wait till the next quarter to get a little more on ANRR.

Yes, I mean John we’re going to have the pull forward. I mean we definitely had the pull forward, I mean those are deals that would have normally started in January.

Great.

In our business it is – it isn’t necessarily common for companies to onboard in December. It doesn’t mean that, it doesn’t happen and there are reasons why a company would look to onboard in December based on their confidence and their year-end, current year-end process that they are going to undertake. ACA added another level to that obviously and so this is revenue we were going to experience anyway but it just so happened we did have that pull forward into December.

Okay, great, Chad. And if I may follow-up because I know these are kind of the questions we’re going to get tomorrow and you’ll get them too along the way. So really strong business right, ANRR last the couple of quarters I mean strong before that but even stronger now and you have little pull forward here but that’s okay. Even without that it was just strong, it was really strong quarter and ANRR as you pointed out and we know turns into revenue in the future and that’s evidence by your guidance especially for the first quarter. But what it implies is that the guidance for the year which again is significantly above where the street is but it implies the growth rate throughout the year will in revenue will actually – or decline or decelerate how is that in the back half. I guess I just want to make sure that like what does that mean? I guess that first you're giving guidance for the year and at the beginning of the year. So I just wondered if there is some conservatism in there or is there something in that guidance of a deceleration of growth into the back half, that there is something we are not thinking about. Is there something that we should be thinking about of how the business may develop over the year?

No, I mean we traditionally had a strong first quarter due to annual tax form filings that again continue to recur. And so we are going have a little bit more of that this year with the Form 1094 and Form 1095 with ACA which will file first quarter of every year for clients that have their service. And so we are going to receive a little bit of uplift on that.

Okay. Okay, great. Thanks a lot Chad. Nice job.

You bet. Thank you.

The next question is from Raimo Lenschow at Barclays.

Hey, thanks for taking my question and congrats. Can I stay on John’s point a little bit Chad, remember the quarter before, when we talked about ACA you kind of kept mentioning that it is kind of a small revenue item for you. And at the end of the day people are going often go stayed with their provider, because the ADP will give you an ACA module. And the $10 million that you point out now is that ACA revenue or is that customer going on the payroll and ACA will be a small module of that, just wanted to clarify that.

That is correct, the latter.

Good.

Those are customers that started early with everything, including ACA, I mean with everything they are going to start with including ACA. So those are clients that on boarded early with ACA. I do not believe that clients choose us for ACA alone. These are deals I think we would have gotten anyway, regardless of ACA. I mean as an HR leader of a mid-sized company, you are not going to make the decision or you should not make the decision to make a change to a payroll service and it's also going to be doing time and labor, talent acquisition, HR, and talent management. You're not going to make that decision based on one piece of the functionality. And so it is something that clients have to have ACA, I believe you should use somebody, who is an expert in complexity, which we are. And I believe that clients need to find someone to do that. But I’m unfamiliar with the competitor of ours that doesn’t have an ACA offering. So whether ours is better or what have you, there just – there has to be a strong business case or value proposition for someone to change their culture, move all their data and learn new systems. And you just – it is not something we’ve seen happened based on one module piece. And so this is pulled forward and deals that would have normally started in January, because there wasn’t a great reason for them to start in December. But due to ACA, we now had a better reason for them to start in December and we on boarded them.

Perfect, very clear thanks, Chad. And on the sales office opening, you mentioned six already in January. As we think about a year, is that kind of the number for the year as far as the – we are very front end-loaded for the year and then maybe had like a couple of – in February, March. Is six the number or is that just the January number?

Six is the number that we have opened this year. It’s the best year we’ve ever had in opening up offices as far as six. We open them up much more efficiently this year than we have in years past. We had more people to choose from, on our bench and what have you. And so we're comfortable absorbing the six that we've opened and then as the year moves on, I mean, we’ll review at that time.

Okay. Perfect. And then one last question. How do you think about the whole balance between gross and EBITDA and the EBITDA levels? So if I look this year, you achieved EBITDA around 21% I think guidance midpoint is around 21%. Is that kind of for you, a healthy probability is much better than the competition. So with rest of the money are reinvest or how do you think about leverage as you run the company?

Well, I mean, I believe it’s important. We’ve been doing this for 18 years now. So I mean I believe it’s important to, at some point be able to have some leverage in the model. We thought that we are a high-growth company and we focused on that. But we are also out there selling profitable business. And so we in the perfect world, we would expect to continue to grow at a high level while also having some leverage in the model on a go-forward basis.

Okay, lovely. Thank you. Well done.

Thank you.

The next question is from Mark Murphy at JP Morgan.

Yes, thank you very much for taking my question and I will add my congratulations on the strong results. Chad, you had mentioned closing a rehabilitation center and I believe you said it has 8,000 employees. So I wanted to ask you first of all, did I hear that correctly what issues were they encountering? In particular with their legacy provider, and then also I’m curious where does that customer ranks now within your customer base in terms of size. And what I’m trying to get at is whether you think that’s a one-off or if you see other prospects of that size in the pipeline?

Yes. So size doesn’t necessarily dictate complexity in the system, I mean sometimes it can. But, 8,000, I mean it’s not going to rank small for us. We’ve kind of reported these numbers in the past. So that is – we definitely at the larger end of clients that we’ve on boarded. And so, as far as what exactly they were experiencing, I don’t know if all the very specific issues that they were experiencing. But it’s not uncommon for us we go through and work our value proposition and then deliver in ROI it’s not uncommon for us to look at both the soft cost and hard cost savings. And there’s a number of techniques that we go through to do that. I don’t necessarily want to telegraph that on today’s call but we’re able to come up with a number as we have collaborative meetings with the client.

Thank you. And then I also want to follow-up on some of the other questions about, this concept of the ANRR pull forward and really I have a very simple question. Do you think that that could recur in Q1 or even in Q2 or is that a one-time event due to sort of unusual year-end characteristics tied to this ACA phenomenon?

I will answer that this way, if you’re not currently on our system, and having been on our system since the first of December, we will not be providing ACA services and filings with those companies for 2016. And so the other piece to your question I guess is yes, we will onboard clients this year who are looking to get complaint with ACA as it relates for 2016 to be filed in 2017 and we will onboard those clients throughout the year. But as I explained earlier they are taking the payroll at the time and attendance and other areas. And so ACA is a piece of that and not the driving force behind why someone makes a decision.

Okay. Craig I wanted to ask you as well. In terms of the Q1 revenue guidance I think you mentioned or you were speaking to this in terms of the EBITDA guidance but the sequential increment is nearly $20 million at the high end of the range and its seems unusually strong. I think you eluded to part of this in terms of some of the 1099s or 1095 the processing of year-end payroll links tax forms and all that. Is there a way you could dig a little bit deeper into that because I think we’re going to try to be gauging for our model with the underlying dynamic is there and just perhaps how much of that is seasonal versus what will recur?

Well, it should all recur. It will just recur in the first quarter of subsequent years. I mean these aren’t one-off charges, these are recurring annual charges.

Yes, understood, but I think we’re, so we’re trying to understand from a modeling perspective that you have business that recurs once per year annually and you have business that recurs all four quarters throughout the year. So I think we’re just trying to understand what portion of that is related to those forms and therefore what kind of a sequential drop off to model in Q2. And I’m just trying to understand if it’s any different than what we’ve seen in prior years. Because, again that – the revenue guidance is just so unusually strong for Q1?

Yes, Mark. So as you’re looking at the out quarters, we’ve given the full year guidance as well as the first quarter. So the balance of that would be spread over the remaining three quarters. And as you’ve seen in the past, the second quarter is typically stronger than – the third quarter is stronger than the second and then the fourth steps up as well. So we would expect from a modeling perspective to be very similar to what you’ve seen in the past. And then, that additional step-up in first quarter would be primarily related to those forms filings. And as Chad mentioned, that will be a recurring revenue item that we’ll file every year.

Okay. Thank you very much.

Thanks Mark.

The next question is from Brendan Barnicle at Pacific Crest Securities.

Thanks so much. Craig, in your prepared comments you called out the large sales and marketing expense related to the upside and commissions. If you hadn’t had this big benefit to ANRR, the one-time, I think related to ACA. What would that, do you have any sense of what that sales and marketing expense might have come in at?

Really, I haven’t looked at that specifically but I mean obviously it would have made an impact on – adjusted EBITDA for the year.

And Chad…

No, sorry…

While just to add on that. I mean we did, what we did mentioned there was $10 million and pull forward into December. So the commission rate associated with the $10 million, you could probably expect to get some of that.

Got it. And then Chad, we’ve seen strong results across a number of your competitors have already reported it as well. So we’ve seen this general upswell part of that you talked about some of the ACA component of it, are there other factors, other than that – that are driving some of the folks to look at – reengaging around there, their payroll and then other parts of the HR platform?

Yes. I mean, again, I’ll go back to ACA is a component of our overall value proposition and the product we sell. And again I’m unfamiliar with any client that would go to us just for ACA alone. And so what we’ve developed throughout the years and what we continue to sell as an overall product, that’s being better at selling product having more mature sales staff, then being able to sell more. I really do believe that’s what’s been driving our growth, ACA has been a timely conversation. I mean anytime you get an opportunity to talk to a client about additional complexity, coming down the pipe, that’s a positive for us, and whether it’s reciprocity law lived in, worked in, states changing labor laws, overtime laws or what have you, that gives us an opportunity and so ACA has done that. It’s provided us an opportunity. We do expect there to be – that there has been some uplift. I mean we are not going to ignore the fact that, that ACA is a revenue generating item for us just like direct deposit and some of the other items that we charge for and so. We expect the ACA to be a good product for us as far as on a moving forward basis. We don't expect ACA revenue in 2016 to be any higher than low-single digits of our overall revenue. And so again, it’s timely for us to be able to have these discussions with people. It does help us get someone that might have on boarded a month from now to onboard now especially, if you're sitting in 2015 because there's still a lot of complexity to it and a lot of its knowledge-based what does someone really know about it. I do expect in 2016, 2017 and in subsequent years for the buzz surrounding ACA to dissipate somewhat as it relates to the filing piece of it, because people are going to understand it and we've seen this happen over and over again. As a leaders in Washington make changes to complexity on either tax codes and other areas and we benefit from that because part of what we do is educate ourselves and to become experts in complexity.

Chad we spent a lot of time talking about the ACA but you've got two other products that came that got released last year with the GL Concierge as well as your LMS solutions. Give us any sense of what percent of revenues those ends up representing?

No, we’re not going to breakout the addition of those or any of our other products. I just wanted to point that out on the ACA. But Paycom Learning is doing very well as is the first year for that product as well as GL Concierge. We take a methodical approach to us developing products based on need and how we're going to sell it as well as client usage. And so everything we develop is on purpose and we expect those products to continue to be strong for us as well.

And then lastly, Chad, obviously markets been very worried about macro weakness in the economy the prospect of recession. Anything that you're seeing with all the different businesses that you work and suggest any real slowing that's going on?

I mean obviously, anything that hurts the overall economy, I think can have an impact on all businesses and the things that impact our clients can have an impact on us. Now, I mean we provided the numbers, we provided the guidance. So as far as do we feel like it's going to have a specific negative impact on us. I mean we feel like we weathered through what it is and I do believe the HCM industry is different. We’re not just a technology company, we are providing a very valuable service and no one should be doing the payroll by themselves, no one. You never converted a payroll if someone doing it in-house that it was correct, ever and I have been doing this a long time. So I don’t believe that’s going away, we have solved the problem with technology but the fact is the service itself extremely valuable and I don’t see companies going backwards and starting to do their own taxes and everything else based on maybe they lost a few employees or what have you. And that said we haven’t necessarily seen any impact – major impact on our business at this point.

Great. Thanks for taking my questions.

Thank you.

The next question is from Brad Reback at Stifel.

Great, thanks very much. Maybe just building on Brendan’s question that beyond there in the economy a little more. Chad if you think back to 2009 can you give us a sense of what if any impact employment levels or changes in employment levels you saw in the install base?

I mean 2009, we were a high grower in 2009 sometimes these types of pull backs in the economy create opportunities for us, because we’re looking to go and create additional efficiencies and for companies that are looking to streamline processes and times like this in order to become a more efficient organization, we’re a better solution. And so often times pull backs led this allow us to go and be much more competitive. Because people are looking at it right, I mean when the things are good people aren’t necessarily looking to streamline efficiencies maybe the way they should, when you have pull back people are forced to do that we’re a better option and answer to your question I mean it was a good year for us in 2008 and 2009 you more had the mortgage companies you had to really look like at that time, look for that time. And we made some changes on our business at that time to make sure we’re handling guaranteed funds properly and other items that have survived us throughout the years. So like again, I’m sorry, I’m not an expert on the economy we’ve been doing this for 18 years. This is going to be a year for us, next year is going to be a year and we’re going to continue on I mean we’re in our own lane here and we’re going to continue to do our business.

Great. Thanks very much.

All right, thank you.

The next question is from Jim MacDonald with First Analysis.

Good quarter guys. Just going off the last question, you say you’re in your own lane but can you give us an update on competition, are you seeing anything different out there?

Not from – well let me say this, the competitions ever changing as far as what competitors provide and that’s been the case from the beginning. And then we’ve had a very strong competitive market. There are few of us that do it. I think from a full service perspective. I’m unfamiliar of anybody of any size since we came into the picture in 1998. So I mean, as far as the players, I mean, I think the players are substantially the same depending on where you’re at. And the flavor of what they provide is – it changes here and there and so do we.

Just a couple of clarifying questions on the ACA. You provide, some of it on a perform basis. But do you provide any of it on a monthly basis and if so what is the split between the two?

So we provide an ACA dashboard which clients are able to use as a standalone product. We also have enhanced ACA which is an ongoing monthly service that we provide which has additional service pieces embedded in it. And then, at the end of each year we also provide the Form 1095 and then as well as 1094 and so. Those are the components that make up our ACA revenue or any revenue associated with ACA.

Can you give us a clue as to how much is one time – is for the form and how much is recurring?

We do not provide that break-out. But as I did say it earlier, we do not expect all of ACA revenue combined, to be more than the low single-digits of our revenue next year.

And just for interest, what percent of your clients use you for ACA, if you can approximately?

Most of the clients that are required to be compliant this year, have implemented ACA with us. But I don’t have an exact number as to those that are using another option for that.

Great. Congratulations, again.

All right, thank you.

The next question is from Mark Marcon at Baird.

I’d like to add my congratulations on the 17 years that I’ve followed all the public payroll companies. This is one of the best quarters I’ve ever seen from anybody. So congrats on the great year.

Thank you.

With regards to one of the questions that have been getting is – just with regards to your more mature offices, I know they’re all growing. But particularly those in Oklahoma and Houston, what are you seeing there just in terms of the growth rates?

We don’t disclose any one office. But, I mean, those offices you named specifically are doing very well. I mean, they’re mature offices, they can open for a while, they’ve had the same managers in them for a little while and so any place where we’ve had a manager in there for some period of time that’s going to be a strong office for us.

Yes. But I mean no degradation in terms of the opportunities that you are seeing out of those offices, just because of what’s happening in the oil patch?

No absolutely not, I mean again, I think it has to do with our size and the overall TAM that we still have left to capture I mean we’re still 1.5%, 2% of our overall TAM. So there is still a lot of room for us out there and I think that’s really more factor. We get to choose who we sell, we’re sometimes we pick up the phone and there is someone saying they want to convert. But often times we choose who we’re going to sell, whether we’re working with a referral source or going to our targeted prospecting methods or some other techniques that we use. So we’re going to continue to sell into those markets and we haven’t seen any type of the pull back.

Great. And then with regards to the ACA revenue that you recognized here in December, I mean you pulled forward $10 million but it sounds like even for this quarter, you gave us the 2016 ACA kind of contribution, for this quarter was even less than that right as a percentage?

Well, what I will say just to kind of tweak that a little bit, we pulled forward $10 million in ANRR.

Right.

Not necessarily revenue, right. So $10 million in ANRR.

Clearly understood.

Businesses started early. Okay, I’m sorry, maybe I miss the question.

I was just saying that the ACA contribution for this last quarter was fairly de minimis was it not?

We do not – I haven’t gone through that number we did a calculation based on next year but I mean you wouldn’t – from an overall year perspective yes. I mean it would have to be a much smaller number.

You gave us that number last quarter Chad, that’s a reason why I was asking is – because it kind of size things so that people could get a perspective in terms of what we haven’t seen that yet. Just switching over to the EBITDA guidance for the full year given the revenue growth if you – the guidance basically implies no EBITDA margin expansion for 2016. If that’s the case would that basically be a function of we’re going to continue to invest behind technology in R&D that will continue to grow at a fairly rapid rate. And then an addition to that there is a possibility that we’re going to continue the strong sales performance and so we want to leave some room in terms of sales and marketing for increased commissions if that comes through?

Yes. I mean I would say the – I mean obviously we’re going to continue to invest in R&D as we have but it seems like the largest impact we have on a successful quarter are sales commissions and we start to see that as you head throughout the year.

Enough. And just to remind people your commissions basically are being paid on the ANRR during the time period when the ANRR is disclosed.

That is correct, that is correct.

Great. Thank you very much and congrats.

All right. Thank you.

All right. Well, I think that’s it. So thanks to everyone for joining us on the call. I’d like to extend thanks again to the team here at Paycom. We had a terrific year and we’re all looking forward to another successful year here in 2016. So thanks for joining us, we’ll see everybody later.

The conference is now concluded. Thank you for attending today’s presentation. You may now disconnect.