Q3 2020 Goosehead Insurance Inc Earnings Call
Thank you for standing by this is the conference operator.
Good tight insurance third quarter Twentytwenty earnings call. As a reminder, all participants are in listen only mode and the conference is being recorded after.
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I will now turn the call over to Dan No VP capital markets. Please go ahead.
Thank you and good afternoon with US today are Mark Jones, Chairman and Chief Executive Officer, Peter said, Michael The President and Chief operating Officer, and Mark Colby Chief Financial Officer by now everyone should have access to our earnings announcement, which was released prior to this call which may also be found on our website at IR doctors had insurance dot com.
Before we begin our formal remarks I need to remind everyone that part of our discussion. Today may include forward looking statements, which are based on the expectations estimates and projections of management as of today.
Forward looking statements in our discussion are subject to various assumptions risks uncertainties and other factors that are difficult to predict and which could cause the actual results to differ materially from those expressed or implied in the forward looking statements.
These statements are not guarantees of future performance and therefore undue reliance should not be placed upon them.
Yeah therell be to our recent filings with the FCC for more detailed discussion of the risks and uncertainties that could impact the future operating results and financial condition abuse and insurance, we disclaim any intentions or obligations to update or revise any forward looking statements except to the extent required by applicable law.
I would also like to point out that during this call. We will discuss certain financial measures that are not prepared in accordance with GAAP management uses these non-GAAP financial measures when planning monitoring and evaluating performance. We consider these non-GAAP financial measures to be useful metrics for management and investors to facilitate operating performance comparisons.
Current period to period by excluding potential differences caused by variations and capital structure tax position depreciation amortization and certain other items that we believe are not representative of our core business.
For more information regarding our use of non-GAAP financial measures, including reconciliations of these measures to the most comparable GAAP financial measures. We refer you to today's earnings release. In addition, this call is being webcast. An archive version will be available. Shortly after the call ends on the Investor Relations portion of the company's website at Www dot.
You said insurance dotcom with that I'd like to turn the call over to CEO Mark Jones.
Thanks, Dan and welcome to our third quarter 2020 earnings call.
I'll provide an overview of our results for the quarter.
As well as our strategy and outlook for the full year I'll.
Ill, then hand, it over to Mike Colby, our Chief operating officer to.
To update you on some of our technology and human capital investments as well as updated actions around the global pandemic.
Our CFO Mark Colby will then go into greater detail on our third quarter results and outlook.
We delivered phenomenal results in the third quarter exhibiting continued strong and profitable growth.
With exceptional service driving high levels of client retention.
We also continued to invest heavily in people and technology.
Which we believe will sustain our momentum many years into the future.
Results further validate our unique and time tested business model.
We run the business putting clients at the center of our universe.
This has had a profound effect on the lens through which we view investments in our business.
All of our investments are made with the guiding objective.
Creating better client experiences and the more loyal client base.
We invest in initiatives that create client focused competitive advantages.
And our disruptive impact on the industry is without peer.
She is truly extraordinary organic growth, while delivering high levels of profitability.
We're arden believers in the experience curve and worked very deliberately to capture and leverage our accumulated experience and intellectual capital using both human and artificial intelligence.
A simple example of this is the approximately 2500 updates we have made to our proprietary CRM system just this year.
Working we're constantly improving and by continuously leveraging the experience curve across a larger and larger business space. We.
We deepened our competitive moat.
Management remains by far the largest owners of you said star.
Our economic interests.
Our both collectively and individually aligned with those of our outside shareholders.
He was a business that long term owners.
Our decision, making is geared to creating value.
And achieving our long term goal of becoming the market leader in U.S. personal lines distribution in my lifetime.
Throughout our history, we have been focused on the U.S.
Personal line space and our accumulated knowledge and operating model has benefited from that singular focus.
Our technology platform designed for our agent and client needs has been iterated over many years.
It incorporates the benefits of regular input and feedback both internally across our organization and externally from partners and clients.
We've done it in a disciplined focus and economically rational way that has allowed for consistent execution on both top and bottom line results.
For many years.
Well technology is improving the consumer experience the role of a knowledgeable agent remains central to educating and serving clients.
Our platform is designed to enhance value in the agent client relationship.
Not this intermediation.
We continue to invest in recruiting training and onboarding to add increasing levels of high quality talent in both the corporate and franchise channels.
Vestments, we made over the last several years, our pain, increasing dividends today and our investments today will pave the way for our success in the future.
In the U.S. personal lines industry. The independent agent channel is poised for continued share gains as many traditional and established personal lines insurance carriers.
Two other avenues to improve their growth trajectory with.
Within the backdrop of this ongoing market shift. We believe you said is uniquely positioned to continue to gain significant share as clients increasingly see the value creation and superior insurance experience driven by a choice product portfolio.
No eligible age and best in class service and unmatched proprietary technology designed to address personal lines client needs.
Now, let me turn to our third quarter results.
I'm very pleased with our execution across all aspects of our operations in the quarter.
First and foremost our recruiting team has stayed on off that.
With another quarter of significant talent additions to our organization in a virtual environment.
Corporate sales agent headcount and total franchise count grew 60% and 52% over the prior year respectively.
These newer agents have hit the ground in a full sprint with the August training class. Then subsequently the September class, both setting company records in production during training all while operating.
Primarily in a virtual setting.
Premium growth, which is a key leading indicator of future revenue growth continues.
Continues to benefit from these efforts.
Total premiums place were $301 million, an increase of 49% over the third quarter of 2019.
Driven by strong new business growth.
And continued high levels of retention.
Revenues were $32 million during the quarter, an increase of 51% and core revenue increased 43%.
We achieved this strong organic top line growth, while delivering EBITDA of $9.3 million in the quarter or 29% of revenues.
Inclusive of heavy investments in people and technology to continue our momentum into 2021 and beyond.
We ended the quarter with 1200, 61, total franchises and increase of 52% from the ergo quarter, well operating franchises increased 41% to four 823.
The third consecutive quarter of accelerating year over year operating franchise growth.
Our significant number of signed and operating franchises with less than one year of experience bodes well for transparency and powerful growth for many years to come.
Corporate sales agent count at the end of the quarter was 371.
Up 60% versus the year ago period.
The ramp up of our new offices in Charlotte, North Carolina, and the second Houston, Texas Office are proceeding well and we are on track to open a Denver, Colorado office in the summer of 2021.
The growth and expanded footprint of our corporate channel plays a significant role in driving growth and profitability in the franchise channel.
The corporate channel is a testing ground for new technology and development of best practices as well as training and mentoring resources for the franchise channel.
We've previously highlighted the success of our virtual sales coaching program and have continued to.
To expand this effort through the first nine months of 2020.
Helping drive a 30% increase in productivity among franchise participants.
We continue to manage the corporate and franchise channels as one integrated whole.
Efforts and investments in corporate channel are integral to our overall success as an organization.
We're also actively expanding hires across the broader organization to support our future growth and innovation.
Our recruiting team currently stands at 89 compared to 60 individuals at the end of 2019.
In the first nine months of the year, we increased our information systems development team by 200%, which is enabling significant progress.
On our technology innovation roadmap.
The combination of the omni channel experience with our World Class service team is having a meaningful positive impact on the overall insurance buying and service experience as evidenced by our increased net promoter score of 91 from 90 at the end of the second quarter and 89.
Nine at the end of 2019.
As a reminder, our net promoter scores are higher than any company, we've been able to identify.
Well our costs to deliver this extraordinary level of service are roughly one quarter of industry best practice.
Our technology and human capital investments will continue to drive the client and agent experiences further strengthening our competitive advantage.
Based on our results through the first nine months of 2020 and strong ongoing momentum, we're raising guidance for the year, the details of which Mark Colby will cover in his section.
Hi, I'm extremely excited about the long term prospects for our business.
The first nine months of this year have set the stage for an exceptional 2020 under unprecedented challenges.
We are keeping our foot on the gas pedal and making important investments in people and technology to double down on our already significant competitive advantage.
In penetrating the enormous U.S. personal lines addressable market.
I want to say for entire you said team for their dedication and enthusiasm, which makes it possible to continue to deliver for our clients referral partners share.
For years and shareholders.
With that I'll turn the call over to Mike Colby.
Thanks, Mark and Hello to everyone on the call are strong results through the first nine months of 2020 and continue to validate our strategy around technology and human capital investment, which is expanding our competitive advantage in the marketplace.
We have made substantial progress on our technology development roadmap and made key additions to the team all while navigating the challenges presented by ongoing global pandemic.
Before I review, our progress in the quarter, Let me update you on our current protocols around COVID-19.
We began bringing employees back to the office on a reduced and rotational basis in the third quarter.
Our focus on the return to the office was first on newer hires and their managers to ensure it positive onboarding experience and successful start and these critical early months of employment.
We ended the third quarter, we have almost all employees back in the office for at least 50% of the work week.
Additionally, we resumed live in person initial training with our corporate start class in October and provided an option for franchise trainees to attend in person.
We believe that live in person training at our headquarters is the most effective way to onboard new team members. We can provide access to our subject matter experts top performers and senior leadership, whatever we do not anticipate returning to a required in person training until the second quarter of 2021 at the earliest.
We're taking these steps carefully and deliberately and have implemented a number of coated mitigation practices at our facilities, including a screening process upon entering the office requiring faced coverings and social distancing.
We will continue to fall all local government and CDC guidelines and our approach to reopening fully while continuing to prioritize the health and safety of our team.
I'd like to highlight that since the start of the pandemic. Our team has delivered or outperformed our internal expectations for all key performance indicators set at the beginning of the year, including agent recruiting and Onboarding in both channels, new business sales productivity and client retention.
This has been a tremendous accomplishment by our people and demonstrates the benefits for many years of significant and consistent investment in technology and human capital.
Now as it relates to technology investments made in the quarter. We've made steady progress on our technology development roadmap that will further improve the already powerful tools our agents have to compete in the marketplace streamline our carrier interactions and enhance the digital experience that we provide to our clients.
The quarter saw further progress with omni channel engagement to more effectively communicate with clients through channels. They prefer.
Nearly 50% of our clients are now on our direct to client facing portal and we're achieving a net promoter score of 95 through this channel.
Within the portal, we have added a new feature for clients to quickly and easily scheduled calls with service agents, allowing these interactions that take place seamlessly ended the clients convenience.
And we've also observed 150% increase quarter over quarter and clients using chat and SMS features for service.
We have made further improvements on backend carrier integrations, the ongoing blocking and tackling that as a key driver of enhancing the client experience and achieving greater cost efficiency in our service delivery. This quarter, we added significant resources in the form of additional technology developers exclusively focused on these integrations and our overall.
Technology team has nearly tripled in size versus a year ago as the current employment environment has created opportunities for us to remain firmly on office.
We are also continuing to streamline and expand the effectiveness of our comparative rating application with the addition of the ability to quote from renters insurance and motorcycle insurance on the platform.
Earlier in the year, we added flood insurance to the comparative rater and year to date have seen a 53% increase in flood insurance sales.
Keep in mind, the profound impact that flood insurance sales have on our client retention.
Not only is this a very important coverage for our clients to procure it is a powerful anchor policies that will improve retention results over time.
Each of these new product additions in the third quarter, we'll continue to provide further improvement to sales and retention going forward.
In addition to improvements and the capabilities of the agent facing application. We have made strong progress on the client interface. We expect to have the first version of our client facing comparative rating application available to clients and 2021, providing a uniquely powerful tool for clients and referral partners to engage with us.
The competitive advantage of our accumulated experience in servicing personal lines clients over many years cannot be overstated while.
While many of the enhancements we make in a given quarter are not material ended up themselves. It is the cumulative benefit of these enhancements over time to has a powerful impact.
Since the beginning of the year, we have added over 2500, new features and enhancements to our technology platform. Many of which are the result of progress with carrier integrations and direct feedback from clients and agents.
I'd like to join Mark and thanking our entire team for their commitment to excellence and fearless execution. This year.
They have delivered outstanding results in an unprecedented time.
Our teams remain enthusiastic and laser focused on achieving our gold industry leadership and delivering an unmatched personal lines experience with that I will turn the call over to Mark Koby to provide color on our financial performance.
Thanks, Mike and good afternoon to everyone on the call for comparability purposes. My comments on our third quarter 2020 results will be discussed against the third quarter of 2019, as if recognize under assay six or five.
A reconciliation of assay six a six accounting to assay six or five accounting for 2020 has been provided as a supplemental schedule in our earnings release.
For the third quarter of 2020 total written premiums, which are an important leading indicator of our future core ancillary revenue growth increased 49% to $301 million. This.
This included franchise premium growth of 57% to $213 million in corporate segment premium growth of 33% to $89 million.
This growth is being driven by continued high retention rates strong new business generation.
And increasing agent productivity in the franchise channel.
The continued shift in our mix of business towards the faster growing franchise channel implies significant embedded future revenue growth as new business premiums convert to renewal premiums. After your one at which time, our royalty fees increased from 20% to 50% for ongoing renewal.
At quarter end, we had over 657000 policies in force a 47% increase from one year ago.
Our consistent and rapid year over year growth in both premiums and policies positions us well for long term success.
Revenues were $32 million for the quarter compared to $21.2 million in the prior year period, an increase of 51%.
If Q3 2020 was reported under assay six or five revenue grew 42% to $30.1 million importantly, core revenues increased 45% to $26.7 million if reported under assay six so far.
During the third quarter, our franchise channel generated core revenues of $11.3 million, if reported under 86 or five an increase of 55% from a year ago.
With the results driven by continued strong growth in new business in renewal royalty fees from an increasing increasing operating franchises combined with higher productivity plus sustained high levels of retention.
At the end of the third quarter. We had 1200 61 franchise is up 52% from the prior year and 823 operating franchises up 41% from a year ago.
We've continued to build on our strategy of national expansion within this channel.
On Texas franchises now represent 73% of our total operating franchises compared to 66% a year ago.
We're continuing to invest in our recruiting team, which currently stands at 89 people at our franchise pipeline remains very strong.
As a reminder, the fourth quarter of each year has historically been our strongest quarter for franchise signings.
If reported under assay six so five corporate channel core revenues were $15.4 million in the third quarter, an increase of 39% from the year ago period, driven by an increase in agents and continued high levels of retention.
Corporate sales head count at the end of the third quarter was 371, an increase of 60% from the year ago quarter.
As a reminder, because of our college recruiting for the corporate channel the summer month or historically, our largest for corporate sales Onboarding and Calvert has had little impact on our ability to successfully recruit and onboard large volumes of exceptional candidates.
We continue to invest in the success of our franchise channel agents via our corporate channel agents to our virtual sales coach program.
As Mark mentioned, our corporate agents virtually coaching franchisees helped drive a 30% increase in productivity among franchise participants.
This is a highly leveraged area of investment not only for our productivity gains, but for the retention impacts from both our franchisees, bringing more successful and our corporate agents, having additional coaching opportunities leading to attractive career paths and management.
Total operating expenses for the third quarter of 2020 or $25 million up 43% from $17.5 million in the prior year period.
The increase is due to higher employee compensation and benefit expense, which was up 57% versus the year ago period. As we continued to play aggressive offense in adding talent to our organization.
For instance, corporate agents grew 60% in the quarter our franchise sales team grew 62% and our information systems development team tripled in size from a year ago.
While many of these hires bring nominal revenue benefits initially.
The investment should fuel our growth for many years to come.
The increase in compensation and benefits is being partly offset by slower growth in general and administrative expenses, which were up 14% compared to the year ago quarter.
DNA expense growth is benefiting from our increased scale and reduced travel and entertainment given the current environment.
Adjusted EBITDA for the quarter was $9.3 million compared to 4.6 million in the prior year.
If reported under assay six so five adjusted EBITDA was 6.9 million, an increase of 50% versus the year ago quarter with growth driven by strong core revenue and margin improvement.
As a reminder, our business has natural operating leverage and should continue to see gradual margin improvement over the longer term.
But we do not manage the business on short term quarterly basis, we focus on maximizing overall profits over the long term.
And we are continuing to make investments for future growth that will have a moderating impact on margin in the near term.
As of September Thirtyth 2020, the company had cash and cash equivalents of $20 million and an unused line of credit of $19.7 million.
During the third quarter, we paid a $42 million or $1.15 cents per share special cash dividend to shareholders.
Based on the strength of our results through the first half of the year and the confidence in our business platform. We are raising our full year 2020 outlook with respect to written premiums in revenue.
Total written premiums placed for 2020 are now expected to be between 1.05 billion and $1.07 billion.
Representing organic growth of 42% than the low end of the range and 45% on the high end of the range.
Total revenues for 2020 under assay six or six revenue accounting are expected to be between $109 million and $112 million, representing organic growth of 41% on the low end of the range and 45% on the high end of the range.
We are very pleased with the momentum in our business and believe we remain well positioned to deliver consistent and sizable growth even during uncertain and challenging environments.
With that I would like to thank everyone for listening and we will now open up the lines for QNX.
Operator.
Thank you if you would like to register a question. Please press the one followed by the four on your telephone.
We'll hear a three Tom prompt to acknowledge your request.
If your question has been answered and you would like to withdraw your registration. Please press the one followed by the three.
And one moment for the first question.
And we do have a question from the line of Mark Dwelle with RBC capital markets. Please go ahead.
Yeah good afternoon.
Just.
Just one quick question you were commenting on the addition to note offering flood insurance and a few other products can you talk to that again and explain like why or how that is that that works.
How it enhances your retention.
Hey, Mark this is Mike Colby Thanks for the question.
Our goal with every account with every customer is to capture full share of wallet.
So it's that means the into the standard you know package would be the home auto umbrella as we're learning the flood I think is a great addition to that but obviously if they have second homes cars.
Senator.
It's very powerful retention.
Tool to be able to cross sell into all lines of business that increases switching costs.
Those two are really demonstrate our value add.
The process. So that is a focus of ours and always has been and is.
A focus across both channels.
But you see especially with our go to market strategy is leading with the home and specifically during and mortgage.
Origination, whether that's a new purchase or refinance so theres a lot going on for the agent. There's a lot going on to the customer and to the extent that we can make it easier and remove obstacles it dramatically increases our likelihood of capturing those other lines of business, if it's a super cumbersome process.
Agent neither the aging of the client are going to want to deal with it. So when we can streamline that dramatically improves the likelihood of us capturing that full share of wallet and not to mention the data that we're bringing into the system is also alerting us.
Where where the opportunity is before it would be up to the agents are really enquire.
But now we're pulling in data and we can see there on a motorcycle we can see you know if they're in a in a flood zone that it makes sense to purchase the flood policy, so where we're excited because removing those obstacles streamlining.
The quoting process and presenting it front and center for the agent will increase the likelihood of us capturing those lines of business, which will drive retention that is statistically true.
True in our business and every business.
I see so ultimately at the end of the day, it's just to basically make sure you can satisfy all their customers needs and.
And you can see great doesn't want to some other agent get putting your daughter anyway. If you can if you can kind of click all the boxes for them great.
Great Great Great point for sure it Insulates the client from from other other competitors.
You know I'll mention it because the standard care degrading applications that are available in the market are typically just for the primary homeowners and the auto so what we're doing is unique really make other lines of business into that comparative rating platform.
Okay.
One other question just kind of a I guess generally in the marketplace.
You know we've heard we've seen a lot of commentary from some of the big homeowners and auto writers.
Lowering lowering prices, particularly on auto insurance is that something that you're seeing across your platform as well I mean, I, probably only has a minor impact on commission revenue per month.
Yeah, I think that's consistent with what we're seeing mark, but we're growing total written premiums at the rate, 49%, we're not going to feel those.
Single digit kind of rate declines you, we don't feel that as a headwind when they're lowering rates and we don't really feel a tailwind when they're raising rates.
Really what we're focused on is driving growth through new agents.
Focusing on productivity enhancing tools for those agents and increasing new sales and focusing on client retention. Those are the areas that we can control and that's where we're focused on driving growth.
Okay. Thanks, Thanks for the answers.
Thanks Mark.
And as a reminder to everyone on the phone lines. If you would like to register a question. Please press the one followed by the floor.
And our next question is from the line of Meyer Shields with KBW. Please go ahead.
Thanks, I want to follow up on one of Mark's questions. If I can when you've got rate decreases I guess historically, we've seen less shopping because people are frustrated I'm is.
Is there any way of Disentangling that retention benefits from the other operating improvements that we're making.
Would that help with retention I guess it would on the margin I mean I think.
The question kind of gets it a couple of things one is I think retention impact, which would be a positive one whether that's a material impact or not.
I don't think its material so.
As it relates to retention as it relates to our R&D business opportunities I think it is worth you know again emphasize that we lead with the home at a point of sale transaction and we cross sell into the automobile and typically even in a in a in a softening great environment work, because we're working with.
Auto insurance companies across the country, we can find a competitive rate as part of that that homeowner insurance procurement.
Okay No that's helpful.
You mentioned another point that I want to touch on I understand that the the market strategy is leading with the home.
Is there a potential pathway to leading with I don't know renters or motorcycle wood.
Would that would make us have complementary penetration Saturday.
No I mean listen I think the renters insurance market that that customer segment is actually quite unattractive.
Lower retention.
Smaller accounts.
Similar acquisition costs.
So when we're looking at.
Go to market, we want to we want to lead with where we can add the most value where the most opportunity as we feel like doesn't the property side and then we cross sell into those other lines of business now, we certainly can accommodate renters.
Customer, but that's not where we're investing dollars for client acquisition is there we're going to start with the big revenue opportunity is.
Okay. No. That's certainly makes that homeowners on other assets go ahead, I'm, sorry, not and that's not always true with renters.
Right No that's that's certainly true.
Mark you talked about the sales classes in August and September setting records in production I was hoping to get a little bit more color about what you think is driving that in other words technology training is that moving people faster to overall productivity or should that productivity improvement last ah that product improvement Mark.
And last as these agents.
Gain more experience.
Well I think it starts with recruiting and we're getting better and better at identifying candidates that can come into the system and produce at very high levels very soon so I think it definitely starts there definitely want to give a lot of credit to our training team who has continued.
Continues to reiterate the training program and make it better and better every single month.
And especially in a virtual environment I mean, they continue to be.
People to bring people on and get them ramped up very quickly. So it's yet to be determined if those outsize contributions will continue in the ramp up process, but.
We are pretty confident that they will at least hit our production goals for them you are starting your career in a better spot when you're when you're when you have that momentum and your training class.
It's certainly it's certainly a better position to be and then maybe climbing out of the hole that you Doug. So I think you know and by the way that the work on our end doesn't stop at initial training to make sure that these agents on successfully and we invest very heavily in our agent support and sales leadership infrastructure to make sure that momentum carries.
Into their lives.
Life operating environment, and I think it's worth noting as well we've talked about in the past.
Our implementation process and some changes that we've made in the implementation process and part of that was we want them to be better prepared and were seeing the performance, but we want them to go live immediately after coming to training.
So that's an important timing consideration as well when you come to training and then you have some type of life event say or something going on that would prevent you from from going lives right out of training maybe a couple of months you really lose that momentum. So that's part of our our thought process as well as an implementation as we at the time training to be immediately before they go live.
And that's where we're getting the best result, so I think it's a combination of things from recruiting to the better Onboarding experience better training experience and the support that we continue to deliver after training.
No understood certainly showing up there was all thank you so much.
Thank you Mary given.
And our next question is from the line of Adam Klauber with William Blair. Please go ahead.
And a couple of different questions well I know east Coast East Coast has been a pretty good growth area or is that still as far as new franchises. One is that still growing really well and that look for exact figures or numbers, but you know just anecdotally, what which states are doing really well.
You know, we're not really see.
Any recruiting challenges in any of our our markets that we're focused on you know the.
On glass and the West Coast is still growing quickly for us we're starting to as we've talked about in the past we put more recruiting resources on the state of Texas, and we're starting to see those results.
Those efforts pay dividends and in Texas growth with the Midwest mid Atlantic.
Fast growing markets for us Georges in these fast growing state tourism, including the northeast so.
Hey, Matt.
To paint with a broad brush on this but we truly are seen great results and all of our markets.
Okay.
And then how is the churn running I'd say you know in the last three six months compared to year ago.
Either agents or franchise or just just across both sources.
We certainly took.
I guess display some patients during the early months of the codependent make and obviously when someone to want to work with folks who are struggling and certainly maybe their struggles are exacerbated through the decoding process I'd say, where we've kind of resumed our normal approach to sales management.
That's.
Managing people up for managing people well I think we're back to kind of our our approach that that's worked for for almost two decades now.
But I would let's take the market without the specifics on on churn. So the corporate sales churn has remained relatively stable over the past few years.
We continue to see some improvement in the franchise channel.
[music].
Okay, Great and then finally one.
What's the size of your franchise recruiting staff at this point.
89 so.
That's good corporate franchise operators.
And for I guess, just for example, just roughly what would have been roughly a year ago.
I think I mentioned in my script is about a 60%.
They said to us.
Sorry.
Sorry about that the Q3 2019, I'm sorry, okay, 85% growth.
Great. So continue to look at us there.
And again those are those investments are going to really pay off for two to three years at the earliest you know it takes them a while to get burned and our system and then from their old as when they recruited and don't really contribute to our PML for two to three years after that so.
We feel like the investment there what we're seeing right now in our pianos result, as the investments we made in 2017 2018, and so the investments we're making today hopefully see 20 to 22 23 and beyond.
Okay, great. Thanks, a lot guys.
Thanks, Adam.
And we have no further questions at this time I will now turn the call back to Marc account [noise].
I just want to thank everyone for joining us on.
I appreciate your support and let you know that we're going to continue to work hard and.
And do our best to dramatically outperformed the industry. Thanks.
Thanks, a lot.
Thanks, everyone.
That does conclude your conference call for today, we thank you for your participation and I say please disconnect. Your lines. Thank you and have a great day.