Good afternoon, ladies and gentlemen and welcome to the Beacon Third Quarter 2022 Earnings Conference Call. My name is Megan, and I will be your coordinator for today. [Operator Instructions] As a reminder, this conference call is being recorded for replay purposes. I would now like to turn the call over to Binit Sanghvi, President, Capital Markets and Treasurer.

Thank you, Megan. Good afternoon, everybody and thank you for taking the time to join us on our call today. Julian Francis, Beacon’s Chief Executive Officer, and Frank Lonegro, our Chief Financial Officer, will begin with prepared remarks that will follow the slide deck posted to the Investor Relations section of Beacon’s website. After that, we will open the call for questions. Before we begin, please reference Slide 2 for a couple of brief reminders. First, this call will contain forward looking statements about the company’s plans and objectives and future performance. Future looking statements can be identified because they do not strictly relate to historic facts or current facts and use words such as anticipate, estimate, expect, believe and other words of similar meaning. Actual results may differ materially from those indicated by such forward-looking statements as a result of various important factors, including, but not limited to, those set forth in the risk factors section of the company’s 2021 Form 10-K. Second, the forward-looking statements contained in this call are based on information as of today, November 3, and except as required by law, the company undertakes no obligation to update or revise any of these forward-looking statements. And finally, this call will contain references to certain non-GAAP measures. The reconciliation of these non-GAAP measures to the most comparable GAAP measures is set forth in today’s press release and the appendix to the presentation accompanying this call. Both the press release and the presentation are available on our website at becn.com. Now, let’s begin with opening remarks from Julian.

Thanks, Binit and good afternoon, everyone. Let’s begin on Slide 4. Today, Beacon reported record third quarter results from the top line to the bottom line, including our 11th straight quarter of year-over-year increase in adjusted EBITDA, continuing our track record of profitable growth. Our team’s focus on the day-to-day execution of our strategic initiatives delivered higher volumes across all three lines of business, driving our highest quarterly net sales in history. The strong volume growth also began to unlock the investment we have made in our inventory, resulting in our best quarterly cash flow since the second quarter of 2020. Non-discretionary reroofing demand continue to provide us with opportunities to deliver value to our customers. Commercial roofing demand remained healthy, while residential growth was supported by repair and reroofing activity across most markets. A few heavy new residential construction markets did slow, but I remind you that 80% of our sales, comes from repair and replacement activity. We continue to make strategic investments in value-creating initiatives towards achieving our Ambition 2025 targets, which is underpinned by the financial flexibility our balance sheet provides. We took an important step this week with the acquisition of Coastal Construction Products, one of the largest independent distributors of specialty waterproofing and associated products in the U.S., which we will discuss in detail a bit later. We also accelerated Greenfield investments, creating capacity, expanding our branch footprint and enhancing service to our core customers. Along with our share buyback program, our balanced capital allocation demonstrates our commitment to creating shareholder value and confidence in our Ambition 2025 strategic plan. I am very pleased with the progress we have made towards our goals and we will continue to invest in generating profitable growth and returns for our shareholders. Now please turn to Page 5. For…

Thanks, Julian, and good evening, everyone. Turning to Slide 10, we achieved more than $2.4 billion in total net sales in the third quarter, up nearly 29% year-over-year with higher volumes across all three lines of business and higher average selling prices for our products. In the aggregate, price contributed approximately 20% to 21% to revenue growth and estimated volumes contributed approximately 7% to 8%. Our backlog, which peaked during the second quarter, remained at a high level and continues to be weighted toward non-residential orders. Acquisitions over the last four quarters, including Midway, are performing well and more than offset the divestiture of our solar business on December 1, 2021. As a reminder, the results of the solar business are reflected in our prior year numbers as part of continuing operations. The drivers of our residential line of business remained healthy as re-roofing activity and units under construction supported growth. Single volumes grew by low single-digits year-over-year, well ahead of the market, even with below-average hail and major storm-related volumes year-to-date. In addition to volume growth, higher selling prices year-over-year, including the shingle price increase announced in August, helped drive the 22% residential net sales growth year-over-year. We also want to highlight that the average selling price for shingles increased sequentially from Q2 to Q3. Non-residential roofing sales were up more than 54%, driven by the combination of price execution and increased volumes. Supply chain loosened somewhat in the quarter with improving material availability. As a result, we started to see the conversion of our backlog, which helped drive one of the highest third quarter volumes in our history. Complementary sales increased approximately 17% year-over-year due to higher volumes across our product categories, including siding and waterproofing. Higher selling prices across all of our complementary product lines, except lumber,…

Thanks, Frank. Now before we turn the call over to Q&A, I’d like to discuss our outlook for the remainder of 2022. Please reference Page 14 of the slide materials. Going forward, we expect the market fundamentals to remain stable as non-discretionary R&R activity underpins our residential and commercial roofing demand. Commercial sentiment remains favorable, and our backlog remains at a high level, both of which are indicative of near-term demand. At the same time, we expect rising interest rates to bring softness in the regions that have heavy exposure to new residential construction. With respect to Hurricane Ian, let me first say that the communities impacted are in our thoughts. In terms of business impact, initial estimates show the volumes required to repair and reconstruct will be approximately 3 million squares or around 2% of annual industry shipments. Keep in mind that these volumes will be spread over the next couple of years. For the fourth quarter, we expect a solid finish to 2022. We expect total sales growth to be up between 15% and 17% year-over-year. And please remember that we will be lapping a record fourth quarter in which we saw significant inflation across all three lines of business. Last year, we also experienced additional volumes from Hurricane Ida and had 2 months of contribution from our Midway acquisition. Please note that our guidance includes 2 months of the Coastal acquisition with net sales contribution of approximately $35 million. With respect to gross margin, we expect to see a roll-off of inventory timing benefit in the fourth quarter and heavier non-residential sales mix compared to the prior year. With that in mind, gross margin is expected to be in the 25% range. Our focus continues to be on the areas within our control, including delivering a high-caliber…

[Operator Instructions] Our first question comes from the line of Michael Rehaut with JPMorgan Chase. Your line is now open.

Hi, good afternoon. [indiscernible] on for Mike. Regarding bottom quintile brands contributions, how are you guys thinking about that over the next 1 to 2 years?

Hi, there. Look, I think we have seen really good traction on that initiative. Obviously, we started this shortly after I joined the company and it was a real focus area for us. We continue to believe that focusing on that bottom quintile, there will always be about a quintile. We continue to believe that there is room. We reset that every year. And I think we have underestimated the potential going forward. But I think that overall, we continue to believe that there is plenty of room for improvement in all our branches and the focus on the bottom quintile is showing improvement across the entire range of branches from top to bottom.

Yes. I think what you heard Julian say was we are off to a really good start. We set a target of 75%. We are in the early 30s here year-to-date. And when we get to 75%, we are not going to stop. We are going to keep going.

Great. And then lastly, I was curious if you guys could give a little bit more color on customer backlogs across your business segments and how they supported sales trend sales trends this past quarter? And if you have any insights in terms of the health of the backlog as you move into 2023?

Yes, another good question. In terms of the backlog, as I mentioned in the prepared remarks, it had peaked in about the middle of the second quarter. When you look at it relative to where backlogs were in the pre-COVID world, it’s still a multiple of that. So we still feel like there is plenty of room left in the backlog. It is more than 50% on the non-residential side. There is the other, call it, 40% or so was split between the resi and the complementary piece with the resi being the larger portion of that remaining 40%. So it’s continuing to deliver for us. It was certainly helpful to unlock some of that in the third quarter and we will continue to unlock some of that in the fourth quarter.

Great. Thank you.

Thank you. Our next question comes from the line of Ryan Merkel with William Blair. Your line is now open.

Hey, guys. Nice job this quarter.

Thank you.

So I wanted to add to your commercial gross margins. I am hearing that commercial gross margins are pretty elevated given what’s going on with supply chain. Can you give us a sense for how much commercial margins are up since 2020 and then what are your thoughts on sustainability as we head into 2023?

Yes. Thanks for the question. I will start and I will let Frank touch on the details. But look, certainly, we have seen it grow. I think we believe we have done a very good job in terms of executing on the price increases. We have said a number of times that we changed the behavior in terms of executing price increases on the day the manufacturers announced instead of rolling it through. With the number and frequency of and scale, quite frankly, of the price increases, we have certainly seen improvements. Look, we believe that there is also a lot of value created in these. I mean we are looking at value-creating opportunities. I think that there has been a real need to improve the overall margin of this business and we have been focused on doing that as much as we have on capturing inventory profits as we have seen these inflationary environments roll through. Look, we are going to do everything we can to sustain these margins. Obviously, the inventory profit side of it will roll off. But look, I remain confident that we are delivering exceptional value to the marketplace.

Ryan, depending on the quarter, obviously, there is some seasonality in all the businesses, and then you have got to look at when the various price increases kicked in and when the inventory profits rolled off on a per quarter basis, but you are in the probably 200 or 300 basis points depending on where you are in that cycle.

Perfect. Thank you.

Thank you. Our next question comes from the line of Kathryn Thompson with Thompson Research Group. Your line is now open.

Hi, thank you for taking my questions today. Just a follow-on on the margin question and particularly related to the non-res. Of the 100 basis points down on the margin, how much of it was cost rising past the prices versus your mix shift to non-res? Is there any way to separate the two? And then is there anyway that you can – a trend that we have seen in certain markets, particularly in the Denver market, even pre-COVID, is you would have a cycle where residential would be – now get too pricey, which would drive strength in multifamily and then it would kind of ping-pong back and forth. Are you seeing trends like that in other fast growing markets in the Southeast and the Southwest? Thank you.

Kathryn, hey. let me start and then kick it over to Julian. In terms of the 100 basis points that we mentioned on the year-over-year gross margins, price-cost was about 60 basis points of that and mix was about 40 basis points of that. Obviously, the mix relates to the non-res piece of the equation. By and large, ASP, so average selling price for most, if not all, of our products, lumber, I am going to take to the side. But most, if not all of our products had higher ASP on both a year-over-year and a quarter-over-quarter basis.

In terms of the trends we are seeing, Kathryn, I think that what we have seen is certainly strength in multifamily. That’s continued. Obviously, the residential single-family market has been impacted by the interest rates and the mortgage rates changing. I think there is some settling out to do in there. I think we all know about the under-building of single-family homes in the country, and I think we will get back to growth in that after a little bit of an air pocket here coming through. But fundamentally, we need it. I don’t think we are seeing anything out of the ordinary on a regional basis sort of bouncing back and forth, as you have articulated. I don’t think we see that. We see strength in multifamily. That’s continued. We see residential single-families has eased in certain parts of the country where the mortgage rates have increased and had an impact. And then commercial, which typically has lagged the residential construction by about 18 months, we continue to see strength in that market. And particularly as the supply chain has eased, I think the projects that have been delayed in our leasing, we are seeing that in our backlog, and we are seeing that in our volume growth in that sector. We think that’s going to continue. And as we said in our prepared remarks, we believe the underlying fundamentals are strong across the board. I think we are going to see how the economy plays out over the next 6 months, 12 months, but we remain confident that the fundamentals are good, and we are excited about where we are with our strategy and the momentum that we are generating. But in terms of trends in the Southeast relative to what we have seen in Denver, I don’t see that specifically come out in our numbers.

Great. Thank you very much.

Thank you. Our next question comes from the line of Ketan Mamtora with BMO. Your line is now open.

Thank you. Quick question on – follow-up your Coastal acquisition, can you talk about some of the key attributes or sort of drivers behind sort of expanding in the waterproofing business in terms of kind of relative attractiveness? Whether it’s in terms of end market or kind of margin stability, anything of that kind would be helpful?

Sure. I would be happy to touch on that. Well, first of all, we have had a specialty waterproofing business out west. We have three acquisitions that we did in the sort of the mid-teens Atlas, [indiscernible] and ProCoat out West. It was 13 branches. And as we rebalanced our portfolio a couple of years ago, when we looked at that, we always felt waterproofing was a category that we run to remain in. It has close ties to the roofing contractor, a lot of roofing contractors do the work. And so it’s always been a part of our complementary and it’s always been this sort of focus on more commercial than residential in terms of that marketplace. So, there is a really strong correlation in that business around the roofing and the replacement market. Given the trends in both climate and what we saw, particularly in Florida with the collapse of the say condominium, obviously, that was a tragic one. That was related to the waterproofing and the maintenance of the waterproofing on that structure, which caused it to deteriorate and obviously collapse. We were familiar with what was going on. And it’s really been something that we have been looking to add to in a meaningful way, and the opportunity with Coastal presented itself as a great one. From an overall business and margin profile, as Frank said, they are more commercial than residential. So, that’s really important. The one thing that I would say about this probably more so than roofing in general is this is a highly technical sale. This is highly specified, as it is with commercial roofing. But there is a tremendous amount of technical capabilities that you need to be in this space, and we have known that from what we have owned. But the Coastal team, as we said again in our prepared remarks, we believe that they have been the recognized leader in this space in terms of technical capabilities. And we think that the technical capabilities you bring creates both barriers to entry and also a great margin profile. So, overall, we think it’s great. We expect to see new regulations, and obviously, this positions us now as the clear leader in specialty, waterproofing, distribution, and we believe that, that’s a tremendous benefit for Beacon as a whole and complementing both our roofing business as well as expanding our waterproofing business. We are very excited about this. And I also want to emphasize the leadership team. They are going to be a tremendous asset to us leading this new division.

Thank you. Our next question comes from the line of Garik Shmois with Loop Capital. Your line is now open.

Hi. Thanks. Congrats on the quarter. As you expect to draw down inventory here in the fourth quarter, do you expect to be largely complete by the end of the year? And then as you are engaging in that process, are you seeing any changes on the pricing side either from the suppliers or from the customers?

Hi. Thanks, Garik. Appreciate that. And good question on the inventory. We will re-evaluate where we are when we get to the end of Q4. A lot of that’s going to depend on the outlook on the market plus a lot of the things that Julian added in for 2023, the momentum that we have, the greenfield etcetera. So, we will re-evaluate at that point in time. But we are entering a period of, I will say, more normalcy than we have been in the last couple of years, and that allows us to be a little bit more surgical in terms of what we buy when we buy, how we buy. In terms of the pricing, obviously, we mentioned in the remarks that quarter-over-quarter, we are continuing to see the average selling price increase. So, even though we destocked by $160 million quarter-over-quarter, you didn’t see that come through on the pricing side. So, we continue to believe that the environment is a good foundation for us.

And Garik, I will add, overall, the manufacturing side is still relatively tight. It’s not an allocation as it was across the entire industry 6 months, 12 months ago. But in general, again, the market fundamentals are sound. The market is actually still very good. It’s far from being a free-for-all out there. It’s a very constructive market for us to sell into today.

Thank you. Our next question comes from the line of Philip Ng with Jefferies. Your line is now open.

Hey Julian. Hey Frank. Congrats on a really strong quarter. Julian, can you give us an early look on 2023? You kind of alluded that you expect demand to be likely down. Can you kind of size that up for us? Is that like a mid-single digit declines? And any color on how you are thinking about between some of these markets, right? I mean commercial, it sounds like you have gotten a little more upbeat. In a declining demand backdrop, how should we think about decremental margins and your ability to kind of ratchet back any of your costs if you need to? Thanks a lot.

Appreciate that. Yes, look, I mean like I said, we believe that we would expect to see the market decline marginally next year. In terms of breaking that out, certainly, we would expect the new residential markets to be impacted by mortgage rates and the decisions of the builders going forward. We continue to believe that the majority of our business is non-discretionary R&R. And that applies to both the residential side and the commercial side of the business. We continue to think that the commercial construction market will continue to unlock. We think it will be, I don’t know, flattish. We, could that be up a little bit, it could be down a little bit, but it will be flattish across the commercial construction market. But again, we believe that the underlying themes here are still strong. In terms of incremental margins, we continue to believe we will grow. We will continue to grow our business. We think we can continue to execute on Ambition ‘25. So, we are not really thinking about decremental margins on this right now because we believe we can grow volume. We believe that the addition of Coastal is constructive. We will add another year of maturity to the 15 or so greenfields that we will add this year. We will continue to add another lot of greenfields next year. We believe we can add another about the same number next year as well. So, we continue to believe that we are going to be presented with opportunities to grow. And we continue to believe there will be acquisition opportunities, and we still think that there will be opportunities for us to improve our productivity at our branches as well. So, we remain confident in our ability to grow despite maybe a little bit of a weaker market that we think that will present us more opportunities.

Thank you. Our next question comes from the line of David Manthey with Baird. Your line is now open.

Thank you. Good afternoon everyone. Julian, in your remarks, you said that we may not see inflation next year, and of course, this industry has historically lacked discipline in softer environments. And I was just wondering, first of all, are you seeing any signs of intensification of shingle price competition in any of your markets today? And then second, if one or more of your competitors do decide to use price as a share gain tool, how do you balance your own Ambition 2025 growth and margin targets relative to a market that may only provide you an opportunity from one of those?

So, the answer to the first question is no. We do not see any indication of that type of using price today. As Frank said a number of times in his prepared remarks, sequential price is positive. I continue to believe that the overall demand level in the market today, even with a slight decline next year that we are expecting is still at sort of higher levels than we were experiencing 5 years ago, sort of pre-pandemic. We expect overall activity to be higher than that. And that is a constructive market as far as we are concerned. That demand level doesn’t indicate to us that we would see everyone rushing out trying to create leverage either in the manufacturing base, which is generally where this would begin or in the distribution space either. We think that this is overall a healthy market. It’s going to come down from what we would describe as elevated levels. But we still see that the overall demand, even if shingles would come down mid-single digits, you have still got a 145 something million square market, which is one of the better markets we have seen except for the past 2 years. So, we think the overall environment is conducive to more stable pricing. We don’t think we will see the inflation come through. We don’t see the inflation we would expect to see from sort of an asphalt coming through. We just think it’s a more stable environment coming in. If someone does go out there and start doing that, obviously, we are going to have to make sure that we are protecting our margins. But our plan is built more on things that we can execute and are in our control versus responding to those market conditions. We believe that adding greenfields, driving productivity, focusing on a new pricing model that we believe can enhance margins going forward, focusing on increasing digital, focusing on increasing our private label are all margin-enhancing initiatives, and we can protect that overall going forward.

[Operator Instructions] Our next question comes from the line of Keith Hughes with Truist. Your line is now open.

Thank you. A question on a couple of points on the closing thought slide, you talked about October sales up high-20s. You are looking for sales per day for the fourth quarter to be up 15% to 17% with the acquisition. But it shows some deceleration there. Could you talk about what you are kind of anticipating to sell at what segments?

Well, I will start and I will let Frank give some detail. But remember, I mean last year’s fourth quarter was a banner fourth quarter. I mean it was. So, when we say it’s decelerating, I mean it’s off last year’s number, which was an incredibly strong fourth quarter. Obviously, last year, I can tell you exactly what winter did last year. I can’t tell you what it’s going to do this year. So, as our outlook looks at it, we are sort of forecasting what we believe would be an average rest of the year, if you like. The markets are pretty good right now. I mean we are seeing a little bit of a slowdown because it gets colder in the north, and that’s natural. We continue to see some markets that have been heavy new residential exposure. They have slowed down sharply as it comes to this point in the year, and the builders are getting ready to close out their quotas for the year. So, overall, it’s still a constructive market. I think the deceleration you referred to, Keith, is more to do with how strong last fourth quarter was than our view of this fourth quarter.

Yes. Keith, in your model, just remember a couple of things. I think we mentioned it, but just to pull them together for you. We have got Ian this quarter, we had Ida last quarter. Ida came out really strong. We are thinking that Ian is going to take a little bit longer to get going given the extent of the damage, the type of the damaged insurance claim process. Obviously, the Coastal acquisition is helpful. But remember that we are also lapping the Midway acquisition last year. And then the only way we can handicap the weather is go down the middle and assume it’s going to be a normal onset of winter weather in the North and in Canada, and that has obviously a revenue drag on our business. If it turns out that it’s warm through Christmas, then it’s a different equation.

Thank you. Our next question comes from David MacGregor with Longbow Research. Your line is now open.

Yes. Good afternoon everyone. My question was on the price cost in the quarter, the negative 60 basis points. And I am wondering if you could just unpack that for us? Just talk me that with the inventory gains, the shift to private label, the digital, there were a lot of pauses and there is obviously a lot of moving parts in there, but that’s why I am hoping you can maybe shed some light on for us, just the puts and takes behind that negative 60 bps.

Yes. The price-cost actually came in better than what we had mentioned to you when we did the Q2 call, so negative 60 bps was better than what we had originally handicapped. When I look at the three lines of business, and remember, we did mention that the ASP, so the average selling price up sequentially. Remember that we are cycling a September shingle increase last year, which had a high realization, more so than the August increase this year. But the storyline on price cost this quarter is not price. The story of this year on price cost is cost. So, the costs are up higher on a year-over-year basis than price is up. And that was prevalent certainly in the residential space, also prevalent but not nearly so in the commercial space and complementary was actually up on price-cost.

Thank you. Our next question comes from Truman Patterson with Wolfe Research. Your line is now open.

Hey. Good evening everyone and thanks for taking my question. Julian, you were discussing some potential M&A into 2023. I am just hoping you can give an update on the M&A pipeline? Is it still relatively robust? Are sellers expecting rational multiples? And then I don’t know if you all have this offhand, but I know Coastal Construction had about $25 million of EBITDA on an annualized basis. Could you remind us how much your acquisitions year-to-date will kind of benefit EBITDA on an annualized basis?

I will let Frank take that last one again too, but the pipeline is robust. We are active. We managed to do five in the last 12 months or so in terms of acquisitions. Two of them fit nicely into that sort of $50 million to $250 million range of revenue midway, obviously, was a great one for us in Kansas City. And obviously, Coastal changes our entire footprint in the waterproofing business, which we think is going to be a great category for us going forward. Look, we are very active. I would tell you that I think that in terms of multiples, we told you at Investor Day, and we continue to say that we are looking to get these transactions done at a multiple, synergized multiple is below our trading multiple. And we believe that we can continue to deliver on that promise and continue to be both active in the marketplace and also competitive in the marketplace.

Hi Truman, just in terms of dimensionalizing things, let me hit you with revenue and then let you imply your own EBITDA. But the combination of the Midway acquisition, the [indiscernible] acquisition, the Wichita Falls acquisition and the Crabtree acquisition. Obviously, except for Midway, those are fairly small acquisitions. You are in the $120 million, $125 million range in terms of annualized. I will say, years zero revenue, so what we bought. All of those companies have done quite well under our ownership. So, the numbers obviously on a going-forward annualized basis, post Beacon acquisition, are higher than that, a combination of better execution, better pricing, better margin. And certainly, the inflation has been helpful there. And then if you tack on the Coastal on top of that at $250 million, if you can use a broad average of the 10% number, and you will get close to where we are from an EBITDA perspective across those acquired companies.

Thank you. Our next question comes from the line of Stanley Elliott with Stifel. Your line is now open.

Hey guys. Thank you, guys for fitting me in. A quick question kind of back on Coastal, it sounds like a great fit. You had the similar business out in the West Coast. It sounded to me like you are thinking about expanding the Coastal business kind of in a similar greenfield strategy, what you are doing with some of your other branches. One, did I hear that correctly? And then two, maybe a little color, what’s changed, I guess now? Is it just the scale that you have on a national footprint of why you want to pursue the strategy since you did have those assets from several years ago out West?

Thanks for the question. So, let me try and sequence this properly. So, first of all, from a strategy standpoint, this was something that we needed to get the timing right in terms of the acquisition. From our standpoint, Coastal was foundational in terms of our strategy to expand the waterproofing footprint, as I said. I believe that when we have repositioned the portfolio, we were very conscious about our decision to maintain our waterproofing business. We think it’s a great business. We wanted to make sure that we could expand it on a national basis. And this – we wanted to get the sort of the Keystone acquisition. I would say the Coastal acquisition was foundational in that. We believe that, that was critical to our path forward, obviously, strong technical, great leadership, East Coast locations. So, that was fundamentally the strategy. I mean one of the things that Beacon is going to bring to Coastal is a range of capabilities that they have not had. But in their business plan going forward, wanted to build out. Digital private label greenfield capabilities, when a $250 million company says they want to do greenfields, they don’t talk about 15. We can now say how do we expand that, so yes, greenfields will certainly be a piece of our strategy going forward. And we are bringing a whole new set of capabilities to Coastal and to the rest of our waterproofing branches now where we feel that this is going to be core to our growth strategy in this space. But it’s also, like I said, about digital, about private label, there is a whole host of things that we can bring to the Coastal team that they have been wanting to build out that we have in place. We also think that it’s a terrific complement to our roofing business. These do overlap. We see them overlap with existing customers. We see it in our specialized waterproofing branches that there is a strong technical capability. And it is a fragmented market that we believe we can play into very, very well.

Thank you. That concludes the questions. Now, I would like to turn the call back over to Mr. Francis for his closing comments. End of Q&A:

Thank you, Megan, and thank you all for joining us today. Let me close today by thanking more than 7,000 team members for their really continued hard work and dedication in this very dynamic environment. Again, our thoughts and prayers go out to the teams and all of the people affected by Hurricane Ian in Florida. I know we have got a lot of people down in that area. There is a lot of devastation and we are certainly open to providing the support to both our employees and to the communities down there. I wish you all the very best for the holidays. And thank you. Be safe, and have a good evening.

That concludes the Beacon third quarter 2022 earnings conference call. Thank you for your participation. You may now disconnect your lines.