Good day and thank you for joining us. Welcome to the U.S. Physical Therapy Second Quarter 2022 Earnings Conference Call. I’d now like to turn the call over to Chris Reading, President and CEO. Please go ahead.

Thanks, Gretchen. Good morning and welcome everyone to U.S. Physical Therapy second quarter earnings call. With me this morning include Carey Hendrickson, our Chief Financial Officer; Eric Williams and Graham Reeves, our Co-Chief Operating Officers; Rick Binstein, our Executive Vice President and General Counsel; Johnny Blanchard, our Assistant Controller. Before we begin to review our quarter and year-to-date results, I’ll ask Johnny to cover a brief disclosure. Johnny?

Thank you, Chris. The presentation contains forward-looking statements which involve risk and uncertainty. These forward-looking statements are based on the company’s current views and assumptions. The company’s actual results may vary materially from those anticipated. Please see the filings with the Securities and Exchange Commission for more information.

Thank you, Johnny. Before I start with my prepared comments, I just want to say this. I have seen the reaction this morning. I know this is a little bit of a disappointment, the team that’s pulled through this. The bulk of this pandemic in really good shape, the same team that’s been together for a really long time. We have some really good things happening, which I am going to talk about. We are not, however, unfortunately immune to the environment that we find ourselves in from an interest rate and inflationary perspective, but we are making our way through and I think we will come out the other side in good shape. So I want to start out this morning by thanking a very committed and talented team, partners, clinicians, front and back office teams and our corporate support group for the work, not only this quarter in the year, but throughout these 2.5 years that we have worked our way through this pandemic and the collateral effects it has generated. I am going to try to keep my comments at a high level to talk a little bit about where we are and what we are working on, where we are making progress and where we are still working through adjustments. I will let Carey do most of the lifting this morning, where I am covering the finer details for the quarter and the year with some exceptions that I intend to cover here. Despite the challenges presented by the current economic operating environment overlaid with the persistence of COVID, I really do think our team proves how resilient it can be to deliver what amounts to. This is the second highest earnings quarter in the history of the company. This is a quarter where we produced all-time high revenues of 10.8% for the quarter, record PT visits of 5.7% year-over-year and 7.8% from the first quarter. Our industrial injury prevention revenue, which approached doubling for the quarter, is up 93.7% and same-store injury prevention revenues are up over 25% for the year. In terms of the things that we could absolutely control, the team did an exemplary job. So what don’t we control? Clearly, we don’t control interest rates or inflation. Both have risen dramatically, but anticipating at least a part of that, our caring team did a terrific job securing a new credit facility, expanding our borrowing ability with the $325 million by hedging the rate on the new facility. All of this will give us the needed additional capacity to execute our long-term growth plans and we have been very busy working on those plans with a really great group of development opportunities, which we look forward to getting over the finish line between now and year-end. We also don’t have control over the macro environment when it comes to inflation or the availability of workers. To that end in the second quarter, we began to feel the impact of some of those forces with rising labor and ancillary costs. We continue to make adjustments where and when possible with respect to downing our costs to the extent that we don’t negatively impact volume or hinder our ability to grow into the future. We continue to work on rate-based negotiations with payers and have invested more resources in that effort. In that area, we are seeing some earnings as well. We are working to accelerate those with these additional resources. We have similar investments in the work comp area that will help us in both BP and injury prevention recruiting as well as in the development of new opportunities in the form of beneficial relationships for the injury prevention group, along with helping to identify acquisition targets, which is proving to be a great asset. We are very excited about what we can drive with these new tools we have invested in. So looking back over the quarter, let’s talk a little bit, let’s start with volume. Volume in the spring was solid. A little later in the quarter, we began to feel the normal seasonal ebb and flow that was decidedly missing in 2021. Concurrent with that, I think we allowed ourselves a little leeway with respect to recruiting new staff given the really tight labor market. We saw our costs pick up a bit in the quarter as a result. Also related, I think folks, our team, not only our team, but our patients, have been cooped up these past 2 years. If you have flown recently, that flight, which probably costs double what you paid a year ago, airlines are full to the brim. People are taking vacations that they were forced to forego these past couple of years. My family, we are going to take our first real vacation in the past couple of years since COVID started. So that impacts our staff coverage as well as referrals and visits, because doctors and their staff are taking time as well. The good news is that schools are starting back soon, at least here in Texas, and the ball will be cranking up across the country with 2-day sessions. I am hopeful that we will see some boosts from that as we make our way through the remainder of the year. Finally, we are working hard to get our costs finely tuned considering the environment we are in at the moment. We have an important project which will take a little time to complete, but ultimately will help to streamline our intake and front desk operations, which we believe will help with costs in that part of our PT business as we continue to move forward. So that concludes my prepared remarks. Carey, if you would, please go ahead and walk us through the financials in more detail.

Will do. Thank you, Chris and excuse me – good morning, everyone. All things considered, our team produced a really good result for the second quarter with operating results per share of $0.90, which as Chris noted was the second highest quarterly amount in our company’s history. Our reported adjusted EBITDA was $21.3 million for the second quarter, which was only down slightly from the $24 million in the second quarter of 2021, which was the second quarter high for the company. Like all companies, we are dealing with the increasing impact of macro environment factors, namely rising inflationary cost pressures and rapidly increasing interest rates in the U.S. Those factors are expected to continue to impact us through the remainder of this year, but volumes remain strong by historic standards. Our team is focused, as always, on finding ways to become even more efficient, so we can produce the best possible results for all of our stakeholders. Our physical therapy patient volumes per day per clinic were 29.5 in the first quarter, which was an increase from 27.9 in the seasonally low first quarter and slightly less than the company high of 30.0 in the second quarter of 2021. By month, our average visits per clinic per day for all clinics were 30.0 in April, 29.7 in May, and 28.9 in June, reflecting our historical pattern entering into the summer months. We don’t have final numbers for July yet, but based on trend data, we expect July volume to be similar to June. Our net rate for our physical therapy operations was $103.18 in the second quarter, which compares to the $104.46 we reported in the second quarter of '21. That rate is up slightly from $103 in the first quarter of this year. The decrease in rate versus last year is due to the Medicare rate changes that went into effect in January of this year and the 1% sequestration impact that went into effect April 1. The remaining 1% sequestration impact became effective July 1. Our total visits increased 5.7% in the second quarter from 1,084,070 visits in the second quarter of 2021 to 1,145,554 visits in the second quarter of this year with the addition of 41 clinics through both acquisitions de novos net of a few normal course sales and closures since the second quarter of last year. Our physical therapy revenues were $119.1 million in the second quarter, an increase of $5 million or 4.3% from the second quarter of last year. Our physical therapy operating costs were $92.9 million as compared to $82.9 million in the prior year. Our physical therapy margin in the second quarter of 2022 was 22.0%, which is a healthy margin despite the increase in costs. New clinics added $7 million in revenue and $1.3 million to the MPT operating margin dollars. Revenue at our mature clinics declined $1.5 million year over year in volumes while expenses increased $4 million or 5%. Our physical therapy salaries and related costs at our mature clinics increased 4.6% in the second quarter of 2022 compared to last year and our contract services and rents were also higher at our mature clinics. On a per visit basis, our total physical therapy costs were $81.09 in the second quarter of 2022 compared to $76.50 in the second quarter of 2021, which is an increase of 6%. Salaries and related costs were $58.29 in the second quarter of 2022 compared to $55.95 in the second quarter of last year, which is an increase of 4.2%. Our revenues for the industrial injury prevention business were at an all-time high, $19.4 million in the second quarter of 2022, which is a $9.4 million or 93.7% increase over the second quarter of 2021. Our expenses in industrial prevention increased $7.8 million, resulting in an IIP operating margin of $4.1 million, which is an increase of $1.6 million or 62.2% over the prior year. Excluding our IIP acquisition in November of 2021, our IIP revenue still increased 25.5% in the second quarter versus last year. Our gross profit was $30.8 million in the second quarter of 2022, which compares to $34.3 million in the second quarter of '21 and our gross profit margin was 21.9%. Our corporate costs were $10.7 million in the second quarter of '22 as compared to $12.1 million in the second quarter of 2021, with a decrease due primarily to lower estimated bonus expense this year. As a percent of revenue, corporate costs were 7.6% of revenues in the second quarter of 2022, which is down from 9.5% in the second quarter of '21. Our other income includes a loss of $617,000 related to the revaluation of our put-right liability, which is associated with the potential second purchase of the remaining portion of the IIP business that we acquired in November of '21. For the first 6 months of 2022, the loss is only $14,000. Our interest expense increased from $237,000 in the second quarter of last year to $987,000 in the second quarter of 2022 due to an increase in our debt, primarily related to acquisitions that we have closed since the second quarter of last year and higher interest rates in the second quarter of this year than last year. Our net income attributable to non-controlling interest was $4.1 million in the second quarter of '22, which is less than the $5 million in the second quarter of the prior year. As a percent of profits, our non-controlling interests were 13% as compared to 14.7% in the second quarter of 2021. The reduction in the non-controlling interest percentage is due to the purchase that we have done of non-controlling interest from existing partners, which results in a greater percentage of our profits being retained by U.S. Physical Therapy. In 2021, we purchased $30.0 million in non-controlling interest from our existing partners and we purchased another $8.6 million in the first 6 months of this year. Our balance sheet remains in an excellent position. We are very pleased to have successfully closed on a $325 million 5-year credit facility in June, which gives us greater capacity for acquisitions and other investments. The facility includes a $150 million term loan and a $175 million revolver. We had nothing drawn on the revolver at June 30 and we had cash on our balance sheet of $48.6 million. Our low leverage coupled with our expanded facility provides us tremendous flexibility and sufficient capacity for the right growth opportunities as we identify them. In connection with the financing transaction, we also entered into a swap agreement in May to fix the rate associated with the $150 million term loan. The swap fixes the 1-month term SOFR at 2.815% for 5 years. Our total rate includes an applicable margin based on our leverage ratio, which currently puts our total rate at 4.665%. The swap provides certainty in the rising interest rate environment at a rate that we believe will be favorable over the 5-year period. We will adjust the fair value of the swap each quarter through other comprehensive income. At June 30, we had an unrealized loss of $400,000 net of tax in OCI. We issued new guidance in our earnings release today noting that we now expect our adjusted EBITDA for the full year to be in the range of $73.5 million to $75.4 million, and for our operating results per share to be in the range of $2.65 to $2.75. The EBITDA and operating results range is taking into consideration our outlook for costs in the second half of the year to the impact of inflation on our wages and other costs, which elevated during the second quarter. Our operating results range also takes into account the change in the interest rate environment in the U.S. since we provided our initial guidance for the year. Specifically, our fixed interest rate of 4.665% on our $150 million in debt from the term loan from the remainder of the year has increased the interest expense impact by approximately 25% versus our previous guidance. Please note that our current guidance does not include the impact of any potential acquisitions we make between now and year-end. As Chris noted, we intend to be active on that front. With that, I’ll turn the call back to Chris.

Yes, thanks Carey. So Gretchen, let’s go ahead and open it up for questions.

We will take our first question from Larry Solow from CJS Securities.

Hi, Larry.

Hi, good morning, Chris. Good morning, Carey. Thanks for taking the question. I guess the first question, just on the guidance, the outlook, and also Q2 a little bit in terms of just the volume trends. I realized Q2 last year was maybe a perfect storm or just an amazing quarter because it was sort of real acceleration and re-ramping back up there COVID. So, but what is your contemplate, it does seem like you are a little bit surprising, maybe it was at June month, which I know came down, taking more than normally in the seasonality, but a little surprising, I guess from our end, that volumes were down a little bit. So what’s your thoughts on that and again, what are you looking at? And in the back half of the year, you mentioned it’s mostly inflationary pressures. What are you thinking about in terms of patient volumes the back half the year?

Yes. So let’s talk about volumes for the quarter, first of all. So April came in solid. We had a really good March, really good April. That was the last time when you guys heard kind of where we were. And then typically, May follows April pretty closely. We pulled back three tenths of the visit in May compared to April. And then once we got into June, we pulled back a little bit more, and I don’t think it was more than a normal seasonal pattern. But if you remember last year, I think this is from memory. So give me a little latitude, but I think it was the highest visit per clinic month in the quarter in '21, which has never happened in 19 years that I’ve been here. That’s the best I can tell you in combination. One, we still have a bunch of people in quarantine from this COVID variant that we’re dealing with right now. Nobody wants to talk about COVID anymore. But as a healthcare company, in a lot of places, we’re back to wearing masks and our patients have masks and in some markets like Tennessee and other places, patients don’t like that and that impacts our volume a little bit. We’ve got people in quarantine. And so Larry, I think we’re back into what I would call a more normal seasonal pattern. So a little slower in the summer; God knows people have pent-up vacation that they put off, including our staff, which they need to take. They have done an amazing job. A little bit longer time off, and a little bit more time away for doctors as well. But I think, once – I’m going to say, I hope once school picks up, vacation seasons largely are in the rearview and football 2-day sessions start, I hope things pick back up again. We have modeled the rest of the year kind of in the vein of where the quarter was – Carey, I don’t know how you…

Yes, it could pick up in the fall like we normally have, just normal seasonal pattern, just the summer pattern then picking up usually in September, and then October through December are really strong months. And I’d say for the full year, when we look at the full year from a volume standpoint, it’s probably going to be similar to last year from a volume standpoint.

Right, which is sort of flattish. And you’ve grown volumes pre-COVID sort of 2, 3, more than that. I think historically it’s been like 2, 3, but always targeted 2, 3, you’ve grown probably 3, 4, maybe higher end of that, 4-ish, 5 years into COVID. So over the next 5 years, do you looking out of the next 5 years, do you feel like- seems like there is room for volume growth, but I’m just trying to – certain one quarter doesn’t make a trend and they are all – it’s still difficult time – there is like you said COVID maybe more fortunately in most cases, a nuisance, as opposed to, not that it’s not serious, but people are just – so things are not a hundred percent efficient. So do you still view yourself as a modest grower in volumes, as we look on an annual basis? I get, this is still kind of a tough call over the next couple quarters.

Yes, no, I definitely think. I mean Larry, right now we’re impacted in certain markets, important markets for us, just on the labor side. We’ve done a good job. Our clinical turnover really hasn’t changed, but it’s taken a little bit longer to fill those spots and in some of those markets we’ve got people that are tired that have been working hard and that’s impacting our volume some. I definitely think we’re going to continue to grow. I don’t have a perfect crystal ball for 5 years. And in these last few years, we haven’t had two quarters that look like the quarter that rubbed up against us. So we’re making our way through, but we’ve got great capacity in our facilities. We’ve got a partner model that we think is the way to go and strong partners and a strong team. And so we just need to get through this bumpy patch.

Yes, no, absolutely. And what about on the – I know you’ve been sort of pounding the drum on the rates. It certainly seems like you guys are – it’s an uphill battle for you when everything is going up and pricing power, but it’s tough. So it does sound like you’re trying to get – you’re making some leeway, at least for some of the bigger payers and hopefully the government will help you out too next year at some point, but any commentary there, any additional commentary there?

No, we just made a reasonably good investment, big investment in terms of some additional horsepower on the rate negotiation side. That’s been very recent. We finally got that done. We have had some wins here lately. As you might expect, I’m not going to name names or any changes, but we’re making progress and we expect to make a good deal more. I think a lot of that will be '23 impacted rather than so much in '22, but it’s important. We think that the value that not just we as a company provide, but physical therapy provides in general is extraordinary. We think it deserves higher rates and we’re going to keep pushing until we get there.

And is CMS given that doesn’t the next year’s proposal usually come out in July? So we are a little late this year. Did I miss it? Has there been anything mentioned for next year yet or no, in terms of the volumes?

Yes, it came out a little bit late, but it did come out late in July. And it’s slated for a 4.5% reduction for next year, which I can hardly imagine, but we’re working on that as we have. Yes. It’s totally unreasonable. So I don’t know how that’s going to land. We will not know until December, but we expect to do some significant work on that between now and then.

What’s the rationale behind? Is it just some convoluted equation that gets to that? Just some high-level from a layman’s perspective, how do they cut you 5% when they are giving 9% to CPIU based rate debtors? It was so crazy.

We are out of that CPIU – some adjustments that were made some years ago. We will be back over, I think in that bucket. I believe it’s 2025. And so I think the original rate reduction was 9 and change, which we were able to mitigate. And so I think this is some residual from that, but we think and hope we will work to mitigate it again.

Okay, great. I appreciate all the color. Thanks.

Okay, thank you.

Our next question comes from Steph Wissink from Jefferies.

Hi, Stephanie.

Hi. Good morning, everyone. I wanted to spend a little bit more time compartmentalizing the labor and wage rate pressure you’re seeing because it does sound like there is a mix of things occurring. One might be availability of labor and just the cost of that labor, especially on the front end. But you also talked about some PTO or away time that you’re also noticing among your staff. So can you just help us think through what components of that mix are the most substantial burden on the revised guidance and what do you expect to be more transitory, maybe related to summer vacations or holidays that you would see some of that labor availability come back into the fall?

Yes, certainly vacations are going to be the transitory part. Really, there – I think for the most part while there might be a little bit more cost related to that, I mean, it’s banked and people are using it to the extent that we can find replacements or temps if somebody’s on vacation, that would bump our cost a little bit, but vacations are normal. We just have people that are a little bit more pent up and carried over some vacation from prior periods. So that’s going to normalize. The other part, the higher labor, we see that particularly at the front desk on the non-clinical side. When you look at our mature facility rate changes, I think it was 4.2%, which given this environment, honestly, I think it could have been a lot higher. Some of that will take a little time to come down, but in talking with my brothers and sisters that are APPQI facilities, I think everybody’s in the same boat. Everybody right now is taking a hard look at their costs. We’ve made some adjustments for the remainder of the year, very surgical, very precise adjustments match very closely to volume. And we have some projects going on right now, that will impact longer-term efficiencies in the staffing and the labor load at our front desks. And so, that’s something that we are very focused on at the moment right now as well.

That actually leads to my second question, which is related to the projects. Maybe share with us a little bit more about what you’re doing, if you can, without it being competitive risk. And secondarily, if there is any sort of cost involved in the back half P&L for the projects, or if it’s a CapEx related project, just help us conceptualize what that might be? Thank you.

Yes. Yes, thank you. So the one project I referenced in my prepared comments. So the one resource I think, I’ll call it. I don’t want to name it because man, it’s an unbelievable resource for us, but it’s helping us on the recruiting side, identify therapists and connect with those people. It’s helping us on the injury prevention side, really connecting with companies that are in our sweet spot on the injury prevention side of things. It’s also helping us identify and connect with companies who may be interested in our development front for our acquisition pipeline, which right now is very solid. So, it actually doesn’t – it isn’t a big investment, but it’s an important investment for us. It’s going to bear fruit, I think for a good while. On the Front Desk project side, that’s ongoing. Carey, I don’t know if you want to speak to that or Eric. I don’t think that’s a big monetary investment. That’s really just people on time on our end working their way through it.

Yes. That’s more of just a rollout integration and timing issue. And Eric, do you want to talk about it some?

Yes. It is a timing issue and obviously with all the different partnerships that we have out there, these systems changes do take a little time. But we are trying to figure out how to improve automation in the Front Desk operation, so we can get by with less labor. So, creating patient portals that allow our patients to schedule, electronic insurance verifications that would reduce the amount of time front office people are spending verifying insurance, and we have dabbled in patient kiosks. You have probably seen these in lots of different businesses now. That used to be people you talk to when you checked in and now it’s more of a norm. And so we are looking for electronic kiosks that would allow us to get by with less front office labor, because that’s really where our biggest turnover is in the company. Our clinical turnover right now is really below industry average, and we have kind of held the line. And as we have talked about on calls before, our clinical turnover is 3 percentage points lower than it was pre-pandemic. So, we are doing pretty good. Having said that, every time somebody does walk out the door, clinical or non-clinical, the new person walking in is more than likely going to be making a little bit more money. So, our focus right now is the front office side that has the highest turnover percentages, and we believe focusing right now on our systems to get by with less labor really is the long-term way to go.

Very helpful. Thank you so much.

Our next question comes from Michael Petusky from Barrington Research.

Hi Mike.

Good morning guys. So, in terms of sort of the double whammy of inflation and sort of going against you, reimbursement away from the government side, going against you, I guess how do you think about M&A in terms of both how you want to approach your balance sheet? And then also, how do you think this impacts smaller PT companies, because gosh, you guys are getting squeezed. You have got significant size and scale advantages over some of these smaller entities. And I am just curious if we are going to see a consolidation just based on sort of the macro? Thanks.

Yes. I don’t think there is any doubt about that. It’s going to squeeze unequally, and it’s going to squeeze larger providers as well, who are more highly levered than we are and who don’t have the financial parameters that Carey just outlined, which are, even though it’s more expensive than we were a year ago, it’s still very, very efficient. So, we are going to use our balance sheet. You guys are going to see that over the coming short-term. We think that there will be even more opportunities as we go forward, as this environment punishes people who are not in equal-sized boats, so to speak. And we think it will be good long-term for us. So, yes, it’s challenging on several fronts, but it’s not just challenging for us. In this profession, it’s going to continue to provide value to the healthcare system. There are a lot of drivers to the growth of physical therapy. And so we are going to get through this bumpy period. And I think out the other side, there are definitely, as you point out, good catalysts that are going to come out of that.

And just sort of a follow-up on the proposed rule for reimbursement cut from CMS. I mean, do you think even at this point, as you look at it that there is more of an opportunity just given the givens and given what it could do for smaller providers that there is a better chance of beating back most of this than maybe last year when you did have some success there too. But I guess it just feels like things have deteriorated in the last few months. And I am just wondering if you think there is a recognition out there; APPA thinks there is, that 4.4, whatever it is, 4.5. It’s ridiculous.

Yes. I do think it is ridiculous. And I think I hope we will get a feedback. We got most of last year’s feedback. I mean this year, unfortunately, the impact which isn’t directed at us. Most of that impact was sequester impact. That sequester relief going away, I think last year was 0.75%, which we felt was less than 1%. And so we got most of it out last year, and I am hopeful that we can do the same or better this year. Time will tell, but obviously, that’s not a certainty.

And just last question and I may have missed the nuance of this. It almost sounded, Chris like, you may have said that obviously the macro is impacting staffing to the great extent, but it almost sounded like, you alluded to possibly late in the quarter maybe you guys could have done better in terms of that piece of things, or did I pick up on something that really wasn’t there?

Look, I think our team’s done an incredible job. We came out of Q1 expecting kind of blow and go Q2 from a volume perspective. I don’t know if the volume materialized quite the way that we expected. We also came out of Q1 with a real urgency around hiring and anticipating real strong volumes. I just think it’s having now a rearview look at it very closely, I think we probably selectively onboarded, not a lot of full-time people, but we probably let our part-time folks go, and we ended up paying a little bit more cost than we could have otherwise. We have made and we are making those adjustments to make sure that stays very, very closely dialed in. We kind of have a handle, I think a sense on volume here. And so I expect that dial-in to be much tighter from here to the rest of the year.

Thanks for the update. I appreciate it.

Thanks so much.

Our next question comes from Mitra Ramgopal from Sidoti.

Yes. Hi. Good morning and thank you for taking my questions. Hi. Just a couple for me. Chris, on the M&A side, you sound pretty confident in terms of getting deals done between now and year-end. Just wondering any specific drivers there? There is the question of valuations being a lot more attractive in this environment versus maybe a year ago. And is it a case also where maybe post-COVID you are seeing one thing in a number of areas of healthcare, increasing retirement, etc., and so maybe that’s also boosting your pipeline.

Yes, so it’s mixed. So, we have been busy all year, a few of these just, the planes that I expect to get on the runway, just taking a little bit longer to land and the timing has been a little bit different. But we are very active, very, very active right now. I think this isn’t related to people retiring. I think it’s related to where people have been the last few years. The folks that we are attracting are really, really strong, highly capable people. We have very high expectations for all of these deals. They are not ready to retire, but they have been through like we have all been through rather a unique period. My 37 years as a therapist, these last few have been kind of crazy. We have done real well and these companies have done well, but most of them see the opportunity to get some support that we provide, some really strong support so they can continue to grow because in their market, they are maybe the big provider and they see a lot of opportunities among and across smaller providers to tuck those in or to move market share. They want a partner to help do that. And so I think that’s what’s going to continue to drive our opportunity more than anything; that and the fact that when our partners come, they pretty much stay forever. We have been a really good home. We don’t take that for granted. We work hard at it, but we are going to have the opportunity to surround ourselves with even more good people as we go forward.

Okay. That’s great. And then, tied in also on the M&A side, who knows how it plays out, but there is obviously talk of recession or a weaker environment heading into next year. Does that factor into how aggressive you want to be on the M&A side? And maybe you can remind us how the company has fared in fears of economic downturn or recession?

Yes. So, yes, everything factors in, Mitra. The interest rate environment factors that impacts the multiples that we and others, I think are going to be able and willing to pay multiples that are at, kind of for me, a career high they have been, and I expect that to pull back. It has to. With the rising interest rate environment, returns aren’t as great. And that is without taking into consideration the macro environment where there are some challenges as well. So, those things certainly influence. In the recession, if we look at '08, '09 and '10, we grew through those years, and we did some things differently when there was a massive labor glut back then. When companies were laying people off, we created the front end of this, a commission-only sales force, and we doubled our sales force in that period of time. And it helped us grow through that recession. We continued to get deals done at good multiples back then. And so it hit our same-store a little bit, certainly when there is high unemployment. I don’t believe that we will get to a high unemployment situation like we did back in 2008 and front half probably of 2009. I think we are too employment-stretched right now for that to happen. But I think we are still well-positioned as we have been. We have a good balance sheet. We are making some adjustments, and I forgot to mention this too. It’s not huge, but it’s going to give us an impact, I think in next years. We are changing who we buy things from and we are moving our resources or will be to get some efficiencies there and we have to. But there are some embedded cost savings in terms of what we have planned there as well. So, we will see, but I don’t think – I think we are well-positioned to deal with what comes at this point. But like we have had to do this quarter, we are going to have to make some adjustments depending on what changes.

Okay. And then just finally on obviously you always had to run a very lean and efficient company. I know on the G&A side, it’s probably the lowest I have seen it in some time in terms of percentage of revenue. So, obviously trying to limit your costs in this environment, just curious if you have more room there or is that something we should expect to start kicking back up?

This quarter we made – we wouldn’t have had to do it because it affects each of us directly here on the exec team, but we made some bonus accrual adjustments in this quarter. We will have some lower bonus accrual just as a result of the reality of our guidance for this year. And so I think that’s the biggest driver. We are already leaning to folks that are working hard. And so that is something I hope that as we go forward outside of this year, I would expect a more normal accrual pattern to happen with more normal, predictable growth as we go forward.

Mitra, that’s typically been in the 9% to 9.5% range of revenue. I think for the second half of this year, it’s probably going to be closer to 8.5% to 9% range as a percent of revenue and then probably back to more normal patterns in 2023.

Okay. That’s great and thanks again for taking the questions.

Yes. Thank you.

It appears we have no further questions at this time.

Okay. Listen, thanks everyone for your time and your questions this morning. Carey and I are available if you have any follow-up, and I hope you have a good day. Thank you. Bye now.

This does conclude today’s program. Thank you for your participation. You may now disconnect. Have a great day.