Q4 2024 Alithya Group Inc Earnings Call

Operator: Good morning, and welcome to Alithya's fourth quarter and fiscal 2024 results conference call. I would now like to turn the meeting over to Alithya's management. Please go ahead.

Unknown Executive: Good morning and welcome to Alithya's fourth quarter and fiscal 2024 results conference call.

Good morning, and welcome to L. It is fourth quarter and fiscal 'twenty 'twenty four results conference call.

Unknown Executive: I will now like to turn the meeting over to Alithya's management; please go ahead.

Speaker Change: I'll now like turn the meeting over to Alex Hughes Management. Please go ahead.

Unknown Executive: Good morning, and thank you once again for joining us for Alithya's fourth quarter and fiscal 2024 results conference call. The press release and MD&A with complete financial statements and related notes were issued this morning and are now posted on our website. The webcast presentation can also be found on our website in the investors section.

Unknown Executive: Good morning, and thank you once again for joining us for Alithya's fourth quarter in fiscal 2024 results conference call. The press release in MDNA with complete financial statements and related notes was issued this morning and is now posted on our website. The webcast presentation can also be found on our website in the investor's section.

Speaker Change: Good morning, and thank you once again for joining us for our leaders fourth quarter and fiscal 'twenty 'twenty four results conference call. The press release and MD&A with complete financial statements and related notes were issued this morning and are now posted on our website.

Speaker Change: West Coast presentation can also be found on our website in the investors section.

Unknown Executive: Please be advised that this call will contain statements that are forward-looking and which are subject to a number of risks and uncertainties that could cause actual results to differ materially from those anticipated. These statements include, without limitation, our estimates, plans, expectations, and other statements regarding the future growth, results of operations, performance, and business prospects of Alithya that do not exclusively relate to historical facts, all which refer to future events, including statements regarding our expectation of our clients' demands for our services, our ability to take advantage of business opportunities, to leverage our service offering, IP, AI, and expertise to meet clients' needs, and to meet our goals set in our three-year strategic plan, as well as our ability to deploy our smart-sharing capabilities.

Unknown Executive: Please be advised that this call will contain statements that are forward-looking in which are subject to a number of risks and uncertainties that could cause actual results to differ materially from those anticipated. These statements include, without limitation, our estimates, plans, expectations and other statements regarding a future growth, results of operation, performance, and business prospects of Alithya that do not exclusively relate to historical facts. Or which refer to future events, including statements regarding our expectation of our clients' demands for our services, our ability to take advantage of business opportunities to leverage our service offering, IP, AI, and expertise to meet clients' needs, and to meet our goals set in our three-year strategic plan, as well as our ability to deploy our smart shoring capabilities.

Speaker Change: Please be advised that this call will contain statements that are forward looking and which are subject to a number of risks and uncertainties that could cause actual results to differ materially from those anticipated.

Speaker Change: These statements include without limitation, our estimate plans expectation and other statements regarding future growth results of operation performance and business prospects. The Liza that do not exclusively related to historical facts or which refer to future events, including statements regarding our.

Speaker Change: Expectation of our clients' demands for our services our ability to take advantage of business. Fortunately is to leverage our service offering IP AI and expertise to meet clients' needs and to meet our goals set in our three year strategic plan as well as our ability to deploy it was march storing capabilities well.

Unknown Executive: For more information, please refer to the cautionary note in our presentation and to the forward-looking statements in a risk and uncertainty section of our MD&A available on our website. All figures discussed on today's call are in kidney and dollars, unless otherwise stated, and we may refer to certain indicators that are non-IFRS measures. Please refer to the cautionary note in our presentation and to the non-IFRS and other financial measures section of our MD&A for more detail.

Unknown Executive: For more information, please refer to the cautionary note in our presentation and to the forward-looking statements in the RIF and Uncertainties section of our MD&A, available on our website. All figures discussed on today's call are in Canadian dollars, unless otherwise stated, and we may refer to certain indicators that are non-IFRS measures. Please refer to the cautionary note in our presentation and to the non-IFRS and other financial measures section of our MV&A for more details.

Speaker Change: For information please refer to the cautionary note in our presentation.

Speaker Change: And to the forward looking statements and the risks and uncertainties section of our MD&A available on our website. All figures discussed on today's call are in Canadian dollars, unless otherwise stated and we may refer to certain indicators that are non ifr if measures.

Speaker Change: Please refer to the cautionary note in our presentation and to the non I O.

Speaker Change: And other financial matters.

Speaker Change: Action of our MD&A for more details.

Unknown Executive: Presenting this morning, our Paul Raymond, Alithya's President and Chief Executive Officer, Bernard Dockrill, Chief Operating Officer, and close to both Chief Financial Officer.

Unknown Executive: Presenting this morning are Paul Raymond, Alithya's President and Chief Executive Officer, Bernard Dockrill, Chief Operating Officer, and Claude Thibault, Chief Financial Officer. I will now turn the call over to Paul and Emma.

Speaker Change: Presenting this morning are Paul Raymond Elite as President and Chief Executive Officer, Bernard Darcheville, Chief operating officer, and close to the Chief Financial Officer.

Paul Raymond: I will now turn to call over to Paul and Paul. Thank you for joining us today. This is an exciting time for Alithya's Q4 marks the end of the year characterized by continued progress of higher values services for our clients and greater operational efficiency in Germany.

Speaker Change: I will now turn the call over to Paul to handle Paul.

Paul Raymond: Bonjour, and good morning everyone. Thank you for joining us today.

Speaker Change: Well, Joe and good morning, everyone. Thank you for joining us today.

Paul Raymond: This is an exciting time for EBS. Q4 marks the end of the year, characterized by the continued progress of higher value services for our clients and greater operational efficiencies, in turn. As this quarter also marks the end of our fiscal year, we will focus on three main areas today. First, our Q4 results. Two, a look at our 2024 fiscal year, and three, an overview of our new three-year plan, which took effect this past April 1st. So let's begin with our Q4 results. Our fourth quarter results reaffirm our ability to improve our business despite challenging market conditions. Our clients recognize the growing value of our

Speaker Change: This is an exciting time for of Etfs Q4 marks the end of the year characterized by the continued progress up higher value services for our clients and greater operational efficiencies in Germany.

Paul Raymond: As this quarter also marks the end of our fiscal year, we will focus on three main areas today. One, our Q4 results. Two, a look at our 2024 fiscal year and three, an overview of our new three-year plan which took effect this past April 1st.

Paul: As this quarter also marks the end of our fiscal year, we will focus on three main areas.

Speaker Change: One our Q4 results.

Speaker Change: You look at our 2020 for our fiscal year and three an overview of our new three year plan, which took effect this past April 1st.

Paul Raymond: So let's begin with our Q4 results. Our fourth quarter results reaffirm our ability to improve our business despite challenging market conditions. Our clients recognize the growing value of our services. This can be seen in the ongoing progress of our margins. Our Q4 gross margins are adjusted into the margin, and our net margins were all new highs for Elite.

Speaker Change: So let's begin with our Q4 results.

Speaker Change: Our fourth quarter results reaffirm our ability to improve our business despite challenging market conditions.

Speaker Change: Our clients recognize the growing value of our services.

Paul Raymond: This can be seen in the ongoing progress of our margins, our Q4 Gross Margin. Our adjusted EBITDA margin and our net margins were all new highs for a leap year. Q4 was also a quarter of robust bookings. In fact, when excluding the two very long-term contracts, we achieved a book-to-bill ratio of 1.27.

Speaker Change: This can be seen in the ongoing progress of our margins.

Lithia: Our Q4 gross margins, our adjusted EBITDA margin and our net margins were all new highs for Lithia.

Paul Raymond: Q4 was also a quarter of robust bookings. In fact, when excluding the two very long-term contracts, we achieved the book-to-build ratio of 1.27. These are all very encouraging signs, and I am particularly proud of our team's results despite the challenging conditions in our industry.

Lithia: Q4 was also a quarter of robust bookings in fact, when excluding the two very long term contracts, we achieved a book to bill ratio of one point to seven.

Paul Raymond: These are all very encouraging. I'm particularly proud of our team's results despite the challenging conditions in our industry. I will now turn things over to Bernard Dockrell, our Chief Operating Officer, to discuss some of the projects and initiatives behind those numbers, followed by Claude Thibault, our Chief Financial Officer. I will then come back at the end to comment on our new three-year plan.

Lithia: These are all very encouraging signs and.

Speaker Change: I'm, particularly proud of our team's results despite the challenging conditions in our industry.

Bernard Dockrill: I will now turn things over to Bernard Dockrill, our Chief Operating Officer, to discuss some of the projects and initiatives behind those numbers, followed by Flowed Symbol, our Chief Financial Officer.

Speaker Change: I will now turn things over to Bernard doctoral our chief operating officer to discuss some of the projects and initiatives behind those numbers followed by Claude Thibault, Our Chief Financial Officer, I will then come back at the end to comment on our new three year plan Bernard.

Paul Raymond: I will then come back at the end to comment on our new three-year plan.

Bernard Dockrill: Bernard, thank you, Paul. Our strong Q4 bookings were fueled by large winds in the healthcare and cybersecurity sectors. This includes a groundbreaking multi-million dollar contract for services to the health and social services industry in Quebec. Over the next five years, we will be implementing a cloud-based, Oracle ERP system designed to revolutionize supply chain processes across the products. The project will be delivered in partnership with LGS, an IBM company, who will serve as a system integrator. This is a type of project that spans the testament to our strategic approach, and we continue to gain traction in the healthcare sector in North America by leveraging our extensive business transformation expertise.

Bernard Darcheville: Thank you Paul.

Bernard Dockrill: Our strong Q4 bookings were fueled by large wins in the healthcare and cybersecurity sectors. This includes a groundbreaking multi-million dollar contract for services to the health and social services industry in Quebec. Over the next five years, we'll be implementing a cloud-based Oracle ERP system designed to revolutionize supply chain processes across the product. The project will be delivered in partnership with LGS and IBM, who will serve as the system integrator. This is the type of project that stands as a testament to our strategic approach, and we continue to gain traction in the healthcare sector in North America by leveraging our extensive business transformation expertise. Overall, our sense is that the low growth in the Canadian market in recent quarters is about to reverse.

Speaker Change: Our strong Q4 bookings were fueled by large wins in the health care and a cyber security sectors.

Bernard doctoral: This includes a groundbreaking multimillion dollar contract for services to the health and social services industry and go back over the next five years, we will be implementing a cloud based work or ERP system designed to revolutionize supply chain processes across the products.

Speaker Change: The project will be delivered in partnership with Lgs, and IBM company, who will serve as a system integrator.

Speaker Change: This is the type of project that stands as a testament to our strategic approach and we continue to gain traction in the health care sector in North America.

Speaker Change: Our extensive business transformation expertise.

Bernard Dockrill: Overall, our sense is that the low growth of the Canadian market and recent quarters is about to reverse. From large banking clients have recently adopted a renewed focus on installed projects, which suggest to us that the industry in general is beginning to recover, and that we will see growth from the financial services sector in terms of life-easing spending by the end of the fiscal year. In Canada, the shift to cloud computing is progressing steadily. They increase in demand for legacy application modernization and client requests for assistance in leveraging our IP solutions to application migration, and Belgian document processing and quality assurance, among other services, presents us with opportunities to grow our revenues.

Speaker Change: Overall, our census at the low growth in the Canadian market in recent quarters is about to reverse.

Bernard Dockrill: Some large banking clients have recently adopted a renewed focus on stalled projects, which suggests to us that the industry, in general, is beginning to recover and that we will see growth in the financial services sector in terms of IT spending by the end of the fiscal year. In Canada, the shift to cloud computing is progressing steadily. The increasing demand for legacy application modernization and client requests for assistance in leveraging our IP solutions for application migration, intelligent document processing, and quality assurance, among other services, presents us with opportunities to grow our. Additionally, this growth allows us to leverage more of our smart shoring capability in the U.S.

Speaker Change: Some large banking clients have recently adopted a renewed focus on installed projects.

Speaker Change: Suggests to us that the industry in general.

Speaker Change: Turning to recover.

Speaker Change: And then we will see growth in the financial services sector in terms of spending.

Speaker Change: The fiscal year.

Speaker Change: In Canada, the shift to cloud computing is progressing steadily.

Speaker Change: The increasing demand for legacy application modernization and client requests for assistance and leveraging our IP solutions for application migration.

Speaker Change: Telegent document processing.

Polity assurance among other services presents us with opportunities to grow our revenues. Additionally, this growth allows us to leverage more of our smart shore and capabilities.

Bernard Dockrill: Additionally, this growth allows us to leverage more of our smart shore and capabilities. In the U.S., revenues used were up at Q4 at a counter for 39% of the liiffy is overall revenue stream. This is up from 37% of a year ago. Those increased revenues were softened by an untradable foreign currency impact, which is closed will discuss a little later. Nevertheless, Q4 in the U.S. was a high-water market for fiscal 2024 in terms of revenue, gross margin, and contribution to a bit done. The U.S. market accounts for 47% of our overall operating PQB Q4. This is up from 38% a year ago.

Speaker Change: In the U S revenues were up Q4, it could accounted for 39% as overall revenue stream.

Bernard Dockrill: Revenues were up in Q4 and accounted for 39% of Alithya's overall revenue stream. This is up from 37% a year ago. However, those increased revenues were softened by an unfavorable foreign currency impact, which Claude will discuss a little later.

Speaker Change: This is up from 37% a year ago.

Speaker Change: Those increased revenues were softened by unfavorable foreign currency impact, which closed will discuss a little later.

Bernard Dockrill: Nevertheless, Q4 in the U.S. was a high watermark for fiscal 2024 in terms of revenue, gross margin, and contribution to EBITDA. The U.S. market accounts for 47% of our overall operating income in Q4. This is up from 38% a year ago.

Speaker Change: Nevertheless, Q4 in the U S. It was a high watermark for fiscal 2024 in terms of revenue.

Speaker Change: Gross margin and contribution to EBITDA.

Speaker Change: The U S market accounts for 47% of our overall operating income in Q4. This is up from 38% a year ago.

Bernard Dockrill: Both our Microsoft and Oracle ERP practices continue to grow in the U.S., and Alithya is seen as a high-quality and trusted partner. In April, a major international wholesaler went live with Alithya and implemented the Microsoft Dynamics 365 Finance and Supply Chain Management Solution for their packaging and distribution operations in North America and Europe. This was the client's third deployment with Alithya, and the project enabled the client to retire multiple legacy systems, part of a digital transformation journey.

Bernard Dockrill: Both are Microsoft and Oracle PRP practices continue to grow in the U.S., and the liiffy is seeing as a high-quality, entrusted partner. In April, a major international wholesaler went live with a liiffy implemented Microsoft Dynamics 365 Finance and Supply Chain Management solution for their packaging and distribution operations for North America and Europe. This was the client's third deployment with a Liiffy, and a project enabled the client to repair multiple legacy systems as part of a digital transformation journey. The successful completion of that project is a testament to the type of collaborative partnerships that drive the successful projects or a Microsoft practice.

Speaker Change: Both are Microsoft and Oracle ERP practices continue to grow in the U S and the Lithia is seen as a high quality and trusted partner.

Speaker Change: In April a major international wholesale who went live with Lithia implemented Microsoft dynamics, 365, finance and supply chain management solution for their packaging and distribution operations for North America and Europe.

Speaker Change: This was the clients third deployment with Olivia.

Speaker Change: Project enable the client to repair multiple legacy systems as part of its digital transformation journey.

Bernard Dockrill: The successful completion of that project is a testament to the type of collaborative partnerships that drive the successful projects of our Microsoft Bracket, not only for ERP, but also for business intelligence, Azure, and training solutions. Q4 also saw positive growth and momentum in our Oracle district, including another significant win with a large and energy-based network of five hospitals employing more than 18,000 people. Comprising Oracle Cloud Enterprise Performance Management, Enterprise Resource Planning, Supply Chain Management, and Human Capital Management, our extensive experience in deploying similar systems positioned us ideally for this project. This $12 million U.S. dollar contract represents Alithya's largest healthcare win in the U.S. to date.

Speaker Change: The successful completion of that project is a testament to the type of collaborative partnerships that drive the successful projects of our Microsoft practice.

Bernard Dockrill: Not only for ERP, but also for business intelligence, Azure, and training solutions. Q4 also saw positive growth in the method in our Oracle business, including another significant win with a large and dearly based network of five hospitals employ more than 18,000 people. Comprising Oracle Cloud and Impress Performance Management, Enterprise Resource Planning, Supply Chain Management, and Human Capital Management, our extensive experience in deploying similar systems positioned us ideally for this project. This $12 million US dollar contract represents a lifted largest healthcare win in the US today. It is also a logical step forward in our upward penetration of larger healthcare facilities across North America, with more than 120 enterprise solution implementations in that sector in the recent years.

Speaker Change: Not only for ERP, but also for business intelligence as your training solutions.

Speaker Change: Q4 also saw positive growth in America in our Oracle business.

Speaker Change: Another significant win with a large energy based network of five hospitals employing more than 18000 people.

Speaker Change: Compromising Oracle cloud enterprise performance management.

Enterprise resource planning supply chain management, and human capital management.

Speaker Change: <unk> experience in deploying similar systems positions us ideally for this project.

Speaker Change: This 12 million U S dollar contract represents a lithium largest healthcare women in the U S. Today.

Bernard Dockrill: It is also a logical step forward in our upward penetration of larger healthcare facilities across North America, with more than 120 enterprise solution implementations in that sector over recent years. As major digital transformations continue to unfold in the U.S. market, our operations remain vigilant in pursuing these large opportunities. I would now like to take a minute to expand on the bigger picture in terms of our SMART shorting strategy in progress. Currently, over 8% of our overall workforce is located outside of our main geographies in the U.S., Canada, and France.

It is also a logical step forward in our upward penetration of larger health care facilities across North America.

Speaker Change: With more than 120 enterprise solution implementations in that sector in recent years.

Bernard Dockrill: As major digital transformations continue to unfold in the US market, our operations remain vigilant in pursuing these large opportunities.

Speaker Change: As major dental digital transformations continue to unfold in the U S market our operations remain vigilant pursuing these large opportunities.

Bernard Dockrill: I would now like to take a minute to expand with the bigger picture in terms of our smart short stretch from progress. Currently, over 8% of our overall workforce is located outside of our main geographies in the US, Canada, and France. With opportunities to create more value for our clients in the Lithia, our intent to continue ramping up our smart short and capabilities going forward. Smart short options are now a common pillar to many of our active engagements and pursuits, providing access to a large, cost-efficient talent pool in our established locations. This additional capability enables us to compete, or we may not have competed previously; provide greater value to our clients.

Speaker Change: I would now like to take a minute to expand on the bigger picture in terms of our smart shoring strategy and progress.

Speaker Change: Currently over 80% of our overall workforce is located outside of our main geographies in the U S, Canada and France.

Bernard Dockrill: With opportunities to create more value for our clients in Alithya, our intent is to continue ramping up our smart sharing capabilities going forward. SmartShare options are now a common pillar for many of our active engagements and pursuits, providing access to a large, cost-efficient talent pool in our established location. This additional capability enables us to compete where we may not have competed previously and provide greater value to our clients. For example, with many organizations deeply involved in migrations to the cloud.

With opportunities to create more value for our clients and Olivia.

Speaker Change: Our intent is to continue ramping up our smart sharing capabilities going forward.

Speaker Change: Smart sure options on our common pillar to many of our active engagements and pursuits.

Speaker Change: <unk> access to a large cost efficient talent pool and our established locations. This additional capability enables us to compete where we may not have competed previously provide greater value to our clients.

Bernard Dockrill: For example, with many organizations deeply involved in migrations to the cloud, AWS signed an agreement with the Lithia in Q4 to retain our smart short team that a provision of cloud migration services. Lithia has been actively involved in the AI landscape for several years. We are proactively investing in our clients' AI upscaling with offerings, such as our Lithia Co-Private Academy to become a trusted leader in this sector as well. The Lithia Co-private Academy is a comprehensive training program to benefit both beginners and advanced users. The weekly program led by Lithia experts includes hands-on sessions and workshops that provide a deeper understanding of Microsoft co-private functionalities and best practices.

Speaker Change: For example, with many organizations deeply involved in migrations to the cloud.

Bernard Dockrill: AWS signed an agreement with Alithya in Q4 to retain our SmartShort team for the provision of cloud migration services. Alithya has been actively involved in the AI landscape for several years. We are proactively investing in our clients' AI upskilling with offerings such as our Alithya Co-Pilot Academy, a comprehensive training program to benefit both beginners and advanced users.

Speaker Change: AWS has signed an agreement with the Lithia in Q4, three retain our smart short team for the provision of cloud migration services.

Speaker Change: Unless he has been actively involved in the AI landscape for several years.

Speaker Change: We are proactively investing in our clients' AI upscaling with offerings, such as our Alysia co pilot Academy to become a trusted leader in this sector as well.

Lithia: Lithia co pilot Academy is a comprehensive training program to benefit both beginners and advanced users.

Bernard Dockrill: The weekly program, led by Alithya experts, includes hands-on sessions and workshops that provide a deeper understanding of Microsoft Copilot's functionalities and best practices. We also continue to invest in AI-assisted intellectual property. While many businesses have been eager to put the cart before the horse, Alithya is well positioned to help its clients prepare, capture, and structure their data using our proprietary rapid capture tool to extract the most value. It's an exciting time for technology.

Lithia experts: The weekly program led by our Lithia experts includes hands on sessions and workshops to provide a deeper understanding of Microsoft co pilot functionalities and best practices.

Bernard Dockrill: We also continue to invest in AI-assisted IP. While many businesses eager to put the cart before the horse, a Lithia is well positioned to help its clients prepare, capture, and structure their data using a society theory, rapid capture tool, sex track, the most value. It's an exciting time for technology, and as organizations complete their preparations and approach the start of their AI journeys, a Lithia will be there to accompany them.

Lithia experts: We also continued to invest in AI assisted IP.

Speaker Change: Many businesses and eager to put the cart before the horse Lithia is well positioned to help its clients prepare capture and structure their data using our proprietary rapid capture tool so extract the most value.

Speaker Change: It's an exciting time for technology and as organizations complete their preparations and approach the start of their AI journeys and lids.

Bernard Dockrill: And as organizations complete their preparations and approach the start of their AI journeys, Alithya will be there to accompany them. Smart Shoring and AI provide a great segue into discussions about our new three-year plan, which Paul will cover later, as they are both critical components of that plan. I will now pass it over to Claude to go over some financial metrics.

Speaker Change: He will be there to accompany that.

Bernard Dockrill: Smart short and AI provide a great segue into discussions about our new three-year plan, which Paul will cover later as they are both critical components of that plan.

Speaker Change: Smart shoring and AI I provide a great segue into discussions about our new three year plan.

Speaker Change: Which Paul will cover later as they are both critical components of that plan.

Claude Thibault: I will now pass it over to Claude to go over some financial metrics.

Speaker Change: I will now pass it over to Claude to go over some financial metrics.

Claude Thibault: Claude? Thank you, Bernard.

Speaker Change: Hello.

Claude Thibault: Thank you, Bernard. Good morning.

Thank you Bernard good morning, as mentioned our fourth quarter fiscal 2024 was highlighted by continued performance improvements on many levels.

Claude Thibault: Good morning. As mentioned, our fourth quarter fiscal 2024 was highlighted by continued performance improvements on many levels. Consolidated revenues came in at 120.5 million dollars, or a year of a year decreased, but a small sequential improvement versus the third quarter. Despite the current general market conditions and the technology services industry, approximately 84% of ALITS Q4 sales came from existing clients, which we had in Q4 last year. This demonstrates strong client relationships, trust, and satisfaction in the ALITS services, regardless of market trends. If we dive a little deeper, we can see that revenues in the US increase sequentially by 7% to 50.4 million dollars due to organic growth, although partially upset by a negative US dollar variation.

Claude Thibault: As mentioned, our fourth quarter, fiscal 2024, was highlighted by continued performance improvements on many levels. Consolidated revenues came in at $120.5 million, where year-over-year decreased by a small sequential improvement versus the third quarter. Despite the general market conditions in the technology services industry, approximately 84% of Alithya's Q4 sales came from existing clients, as were we in Q4 of last year. This demonstrates strong client relationships, trust, and satisfaction in Alithya's services.

Claude Thibault: Consolidated revenues came in at $125 million or year over year decrease, but a small sequential improvement versus the third quarter.

Claude Thibault: Despite the current general market conditions, and the technology services industry, approximately 84% I believe Q4 sales came from existing clients, which we had in Q4 of last year.

Speaker Change: This demonstrates strong client relationships trust and satisfaction in the OTT services, regardless of market trends.

Claude Thibault: Regardless of market, if we dive a little deeper, we can see that revenues in the U.S. increased sequentially by 7% to $50.4 million due to organic growth, although partially offset by a negative U.S. dollar variation. On a year-over-year basis, Q4 revenues in the U.S. also increased by 2.4%. On a sequential basis, our international revenues increased as well, by 2%. Now in Canada, we still face some challenges, as shown by our revenue numbers, both sequentially and year over year. Revenues decrease 5% sequentially.

Speaker Change: If we dive a little deeper we can see that revenues in the U S increased sequentially by 7%.

Speaker Change: To $54 million.

Speaker Change: Due to organic growth, although partially upset.

Speaker Change: Negative U S dollar variation.

Claude Thibault: On a year of a year basis, Q4 revenues in the US also increased by 2.4%. On a sequential basis, our international revenues increased as well by 2%.

Speaker Change: On a year over year basis Q4 revenues in the U S also increased by two 4%.

Speaker Change: On a sequential basis, our international revenues increased as well by 2%.

Claude Thibault: Now in Canada, we still faced some challenges as shown by our revenue numbers, both sequentially and year over year. Revenues decrease 5% sequentially to 64.6 million or 20.4% year over year. Those numbers reflect the fact that our clients in the Canadian financial sector are generally in a lower IT investment cycle, although we are seeing stabilization in terms of spending levels. In regard to gross margin as a percentage of revenues, however, we are reporting a fourth consecutive quarter of improvement. I noted in previous quarterly calls how challenging it is to increase gross margin during lower revenue cycles.

Speaker Change: Now in Canada, we still face some challenges.

Speaker Change: <unk> revenue numbers, both sequentially and year over year.

Speaker Change: Revenues decreased 5% sequentially to $64 6 million or 24% year over year.

Claude Thibault: 64.6 million, or 20.4% year over year. Those numbers reflect the fact that our clients in the Canadian financial sector are generally in a lower IT investment cycle. Although we are seeing stabilization in terms of spending levels, in regard to gross margin as a percentage of revenues, however, we are reporting a fourth consecutive quarter of improvement. I noted in previous quarterly calls how challenging it is to increase gross margin during lower revenue cycles. However, we achieved sequential progression again.

Speaker Change: Those numbers reflect the fact that our clients in the Canadian financial sector.

Speaker Change: Generally in a lower <unk> investment cycle.

Speaker Change: Although we are seeing stabilization in terms of spending levels.

Speaker Change: In regards to gross margin as a percentage of revenues. However, we are reporting a fourth consecutive quarter of improvement.

Speaker Change: I noted in previous quarterly calls how challenging it is to increase gross margin growing lower revenue cycles.

Claude Thibault: However, we achieved sequential progression again despite another quarter in a softer revenue context. And despite Q4 always posing a special challenge because of the annual reset of payroll benefits. Specifically, gross margin as a percentage of revenues increased to 32.1%, a record high, and up from 29.9% in the same quarter last year. On a sequential basis, gross margin percentage also increased in comparison to the 31.3% reported in the third quarter. Our gross margin percentage increased in all geographies year over year and sequentially, mainly due to higher value services, higher utilization, improved project performance, and geography mix.

Speaker Change: However, we achieved sequential progression again.

Claude Thibault: Despite Another Quarter in a Softer Revenue Context and despite Q4 always posing a special challenge because of the annual reset of payroll benefits, gross margin as a percentage of revenues increased to 32.1%, a record high, and up from 29.9% in the same quarter last year. On a sequential basis, Gross Margin Percentage also increased in comparison to the 31.3% reported in the third quarter. Gross margin percentage increased in all geographies, year-over-year and sequentially, mainly due to higher value services, higher utilization, improved project performance, and geography mix. And this, again, despite the employer benefit reset of January 1st.

Speaker Change: Despite another quarter and a softer revenue context.

Speaker Change: Despite Q4 always posing a special challenge because of the annual reset of payroll benefits.

Specifically gross margin as a percentage of revenues increased to 32, 1% a record high.

Speaker Change: And up from 29, 9% in the same quarter last year.

Speaker Change: On a sequential basis gross margin percentage also increased in comparison to the 31, 3% reported in the third quarter.

Speaker Change: Our gross margin percentage increased in all geographies year over year and sequentially.

Speaker Change: Due to a higher value services higher utilization.

Speaker Change: Improved project performance and geography mix.

Claude Thibault: And this again, despite the employer benefit reset of January 1st.

Speaker Change: And this again, despite the employer benefit reset of January 1st.

Claude Thibault: Now looking at SGN expenses, we have also witnessed significant improvements for consecutive quarters, and we are happy to see our cost control efforts continuing to bear fruit. Total gross SGN expenses in the fourth quarter amounted to 29.6 million dollars. A decrease of 17.7% year over year, which was a notable decrease when looking at numbers on an annualized basis, even when considering the non-recurring impairment charge of last year. SGN expenses as a percentage of revenues came in at 24.6% in Q4 compared to 26.4% for the salary expenses, decreased in share-based compensation, and a reduction in impairment.

Claude Thibault: Now looking at his G&E expenses, we have also witnessed significant improvements in consecutive Quarters, and we are happy to see our cost control efforts continuing to bear fruit. Total gross SGA expenses in the fourth quarter amounted to $29.6 million, a decrease of 17.7% year-over-year, which is a notable decrease when looking at the numbers on an annualized basis. Even when considering the non-recurring impairment charge of last year, SG&E Expenses as a Percentage of Revenue came in at 24.6% in Q4, compared to 26.4% for the same period last year. Namely, a reduction of 6.4 million dollars.

Now looking at SG&A expenses, we have also witnessed significant improvements for consecutive quarters.

Speaker Change: And we are happy to see our cost control efforts continuing to bear fruit.

Speaker Change: Total gross SG&A expenses in the fourth quarter amounted to $29 $6 million.

Speaker Change: A decrease of 17, 7% year over year, which is a notable decrease when looking at numbers on an annualized basis.

Speaker Change: Even when considering the nonrecurring impairment charge of last year.

Speaker Change: SG&A expenses as a percentage of revenues came in at 24, 6% in Q4.

Compared to 26, 4% for the same period last year.

Speaker Change: <unk>, a reduction of $6 $4 million.

Claude Thibault: This was driven mainly by reduced salary expenses, a decrease in share-based compensation, and a reduction in impairment. Overall, thanks to the above performance on cost management. Our fourth-quarter adjusted EBITDA amounted to $10.5 million, which is slightly higher than the same period last year when our revenues were notably higher and an all-time high. This shows very clearly how much progress we've made in terms of operational performance and how much our profitability could be as soon as we return to our higher historical revenue level.

Speaker Change: Driven mainly by reduced salary expenses decrease in share based compensation and a reduction in impairment.

Claude Thibault: Overall, thanks to the above performance on cost management, our fourth quarter adjusted a bit the amount of to $10.5 million, which is slightly higher than the same period last year, when our revenues were notably higher, and in all time high. This shows very clearly how much progress we've made in terms of operational performance and how much our profitability could be as soon as we return to our higher historical revenue levels. We would also like to point out that at 8.7% of adjusted the EBITDA margin, we are within a couple hundred thousand dollars of the three-year goal we had set of reaching a minimum EBITDA margin of 9% by the end of fiscal 2024.

Speaker Change: Overall, thanks to the above performance on cost management, our fourth quarter, adjusted EBITDA amounted to $10 $5 million.

Speaker Change: Which is slightly higher than the same period last year, when our revenues were notably higher.

Speaker Change: And an all time high.

Speaker Change: This shows very clearly how much progress we've made in terms of operational performance.

Speaker Change: And how much our profitability could be as soon as we returned to our higher historical revenue levels.

Claude Thibault: We would also like to point out that at 8.7% of adjusted EBITDA margins, we are within a couple of hundred thousand dollars of the three-year goal we had set, of reaching a minimum EBITDA margin of 9% by the end of fiscal 2024. Considering Alithya's overhead profile, and again, considering the current low revenue environment.

Speaker Change: We would also like to point out that at eight 7% of adjusted EBITDA margin.

Speaker Change: Within a couple of hundred thousand dollars of the three year goal, we had set of reaching a minimum EBIT margin of 9%.

Speaker Change: By the end of fiscal 2024.

Claude Thibault: Considering Alithya's overhead profile, and again considering the current low revenue environment, we are quite confident that this performance is setting a strong base and great momentum for the next phase of our strategic plan. Also, our record high adjusted net earnings at $6.1 million, or $0.06 per share, increased by 49% year over year and 40% sequentially. I would also point out our accounting net income of positive $2.3 million, which has improved significantly from negative $20 million in the same period of the last year, even though Q4 last year has been impacted by certain non-recurring elements. Of note, we are reporting positive accounting net earnings for the first time since becoming public in 2018, a positive trend which we have been calling out for a while.

Speaker Change: Considering the leeches overhead profile and again, considering the current low revenue.

Speaker Change: <unk>, we are quite confident that this performance is setting a strong base and great momentum for the next phase of our strategic plan.

Claude Thibault: We are quite confident that this performance is setting a strong base and great momentum for the next phase of our strategic plan. Also, our record high Adjusted Net Earnings, at $6.1 million, or $0.06 per share, increased by 49% year-over-year and 40% sequentially. I would also point out our accounting net income of positive $2.3 million, which has improved significantly from negative $20 million in the same period last year, even though Q4 last year had been impacted by certain non-recurring elements.

Speaker Change: Also our record high adjusted net earnings at $6 $1 million or <unk> <unk> per share.

Increased by 49% year over year and 40% sequentially.

I would also point out our accounting net income of positive $2 $3 million.

Speaker Change: Which has improved significantly from negative $20 million in the same period of last year, even though Q4 last year had been impacted by certain nonrecurring elements.

Claude Thibault: Of note, we are reporting positive accounting net earnings for the first time since becoming public in 2018, a positive trend which we have been calling out for a while. We got some help in the quarter from a non-recurring element, but we did move closer to reaching that milestone regardless. The market will surely appreciate seeing a positive accounting net earnings amount. But as a reminder, we have actually always been cashflow positive. Despite recording accounting losses, just because of high depreciation and amortization charges.

Speaker Change: Of note we are reporting positive accounting net earnings for the first time since becoming public in 2018.

Speaker Change: A positive trend, which we have been calling out for a while.

Claude Thibault: We get some help in the quarter from a non-recurring element, but we did move closer to reaching that milestone regardless. The market we're surely appreciating seeing a positive accounting net earnings amount, but as a reminder, we have actually been always casual positive, despite recording accounting losses, just because of high depreciation and amortization charges. Finally, considering our $10.5 million of adjusted EBITDA and our $9.7 million of cash generated from operating activities before working capital variations, this translates into strong cash look conversion of 92%. Of note, this is despite the fact that we had over $2 million of severance in Q4, which is excluded from adjusted EBITDA while obviously impacting cash flow and which we expect to be decreasing going forward.

Speaker Change: We get some help in the quarter from a nonrecurring element, but we did move closer to reaching that milestone regardless.

Speaker Change: The market, we're surely appreciate seeing a positive accounting net earnings amount.

Speaker Change: But as a reminder, we have actually been always cash flow positive. This.

Speaker Change: Despite recording accounting losses, just because of higher depreciation and amortization charges.

Claude Thibault: And finally, considering our $10.5 million of adjusted EBIT and our $9.7 million of cash generated from operating activities before working capital variation, this translates into a strong cash flow conversion of 92%. Of note, this is despite the fact that we had over $2 million of severance in Q4, which is excluded from adjusted EBITDA, while obviously impacting cash flow, and which we expect to be decreasing going forward. With regard to our fiscal 2024 12-month results, we wish to point out a few metrics.

Speaker Change: Finally, considering our $10 5 million of adjusted EBITDA and.

Speaker Change: And our $9 $7 million of cash generated from operating activities before working capital variations.

Speaker Change: This translates into strong cash flow conversion of 92%.

Speaker Change: Of note. This is despite the fact that we had over $2 million of severance in Q4, which is excluded from adjusted EBITDA, while obviously impacting cash flow.

Speaker Change: And which we expect to be decreasing going forward.

Claude Thibault: With regards to our fiscal 2024, 12-month results, we wish to point out a few metrics achieved despite the cyclical decline in revenues already discussed. Indeed, we achieved an overall improvement in our adjusted EBITDA margin, which came from a 140-point improvement in gross margin and a $5 million reduction in SG&A expenses.

Speaker Change: With regards to our fiscal 2024 12 month results, we wish to point out a few metrics.

Claude Thibault: This was achieved despite the cyclical decline in revenues already discussed. Indeed, we achieved an overall improvement in our adjusted EBITDA margins, which came from a 140 point improvement in gross margin and a $5 million reduction in SG&E expenses. In closing, let's discuss our liquidity and financial position. Net cash generated by operating activities was $9.7 million, representing an increase of $5.3 million, or 120% year-over-year. As of March 31st, 2024, when combined with other cash flow elements, this resulted in a total long-term debt reduction of $9.8 million to $117.4 million, and in our net debt to EBITDA multiple falling back below $3,000. I will now pass it back to Paul to discuss our new three-year plan.

Speaker Change: Despite the cyclical decline in revenues already discussed.

Speaker Change: Indeed, we achieved an overall improvement in our adjusted EBITDA margin.

Speaker Change: Which came from a 140 point improvement in gross margin and a $5 million reduction in SG&A expenses.

Claude Thibault: In closing, let's discuss our liquidity and financial position. Net cash generated by operating activities was $9.7 million, representing an increase of $5.3 million, or 120% year-over-year.

Speaker Change: In closing, let's discuss our liquidity and financial position net cash generated by operating activities was $9 $7 million.

Speaker Change: Representing an increase of $5 $3 million or 120% year over year.

Claude Thibault: As of March 31, 2024, when combined with other cashflow elements, this resulted in total long-term debt reduction of $9.8 million to $117.4 million, and in our net debt to EBITDA multiple, falling back below three times.

Speaker Change: As of March 31, 2024, when combined with other cash flow elements. This resulted in total long term debt reduction.

Speaker Change: Nine $8 million to $117 4 million.

Speaker Change: Indeed, our net debt to EBITDA multiple falling back below three times.

Paul Raymond: I will now pass it back to Paul to discuss our new three-year plan.

I will now pass it back to Paul to discuss our new three year plan.

Paul Raymond: Paul, thank you, Claude. Our new three-year plan took effect on April 1st, and we will be holding an investor day in September to present a detailed plan to all of our stakeholders. But in summary, our plan aims to achieve a scale in scope which will allow us to leverage our geographic presence, our expertise, our integrated offerings, and our leadership positions to target higher value IT segments.

Speaker Change: Paul.

Paul: Thank you Claude.

Paul Raymond: Our new three-year plan took effect on April 1, and we will be holding an investor day in September to present a detailed plan to all of our stakeholders. But, in summary, our plan aims to achieve scale and scope that will allow us to leverage our geographic presence, our expertise, our integrated offerings, and our leadership positions to target higher-value IT sectors. Key to that process is our ability to continue building relationships of trust with our clients, our people, our investors, and our partners.

Paul: Our new three year plan took effect on April <unk>, and we will be holding an investor day in September that presented a detailed plan to all of our stakeholders, but in summary.

Paul: Our plan aims to achieve the scale and scope, which will allow us to leverage our geographic presence our expertise our integrated offerings and our leadership positions to target higher value segments.

Paul Raymond: Cheat of that process is our ability to continue building relationships of trusts with our clients, our people, our investors, and our partners. We currently have valuable client relationships, which include both large industry and government organizations in our target markets. By amplifying the value we provide, we will create greater awareness and interest than the lead. He has an extensive slate of innovative solutions and services. The man for both business and technology consultant is being driven by organizations' need to accelerate their digital transformation. His organizational efficiency and optimization projects now rule the day. Clients are shifting their emphasis towards cost-control efficiencies and automation.

Paul: Key to that process is our ability to continue building relationships of trust with our clients our people our investors and our partners.

Paul Raymond: We currently have valuable client relationships, which include both large industry and government organizations in our target market. By amplifying the value we provide, we will create greater awareness and interest in Alithya's extensive slate of innovative solutions and services. Demand for both business and technology consulting is being driven by organizations needing to accelerate their digital transformation. His Organizational Efficiency and Optimization Projects Now Rule the Day. Clients are shifting their emphasis towards cost control, efficiencies, and automation, and Alithya is perfectly positioned to answer those needs.

Paul: We currently have valuable client relationships with them, which include both large industry and government organizations in our target markets.

Lithia experts: By amplifying the value, we provide we will create greater awareness and interest that lithia has extensive slate of innovative solutions and services.

Lithia experts: Demand for both business and technology consulting is being driven by organizations need to accelerate their digital transformation.

Speaker Change: Since organizational efficiency and optimization projects now ruled the day clients are shifting their emphasis towards cost control efficiencies and automation.

Paul Raymond: Elitia is perfectly positioned to answer those needs.

Speaker Change: <unk> is perfectly positioned to answer those needs.

Paul Raymond: Most business leaders believe in the potential of AI and generative AI, but many are still without clarity on how to use it, either on a larger scale or on how to mitigate the associated risks. We see this challenge as a source of future growth for our business as clients reach out for assistance in understanding and harnessing its potential with respect to their products, their services, and their operations. Our new three-year plan also lays out strategies for Elitia to achieve between 5% and 10% of annualized organic growth, while increasing our Avidda to a range of 11 to 13%.

Paul Raymond: Most business leaders believe in the potential of AI and generative AI, but many are still without clarity on how to use it, either on a larger scale or on how to mitigate the associated risk. We see this challenge as a source of future growth for our business as clients reach out for assistance in understanding and harnessing its potential with respect to their products, their services, and their operations. Our new three-year plan also lays out strategies for Alithya to achieve between 5% and 10% of annualized organic growth while increasing our AVIDDA to a range of 11% to 13%.

Most business leaders believe in the potential of AI and generative AI, but many are still without clarity on how to use it.

Speaker Change: Either on a larger scale or and how to mitigate the associated risks.

Speaker Change: We see this challenge as a source of future growth for our business as client reach out for assistance in understanding and harnessing its potential with respect to their products their services and their operations.

Our new three year plan also lays out strategies for our lithia to achieve between five and 10% of annualized organic growth.

Speaker Change: Increasing our EBITDA to a range of 11% to 13%.

Paul Raymond: It also includes objectives to acquire complementary businesses totaling $150 million in revenues over the next three years. We have a healthy funnel of high-value complimentary acquisition targets, and we will continue to focus on the United States, Canada, and Western Europe. Moving forward, our intent is to also deliver an increasing percentage of our business using AI-based tools and our smart-shoring centers. We believe the scaling up of our smart-shoring operations will provide us with a greater pool of qualified experts and margin improvements, while opening new doors to provide services in the areas where we do not currently compete.

Paul Raymond: It also includes objectives to acquire complementary businesses totaling $150 million in revenues over the next three years. We have a healthy funnel of high-value complementary acquisition targets, and we will continue to focus on the United States, Canada, and Western Europe. Moving forward, our intent is to also deliver an increasing percentage of our business using AI-based tools and our smart shoring center. We believe the scaling up of our smart shoring operations will provide us with a greater pool of qualified experts and margin improvements, while opening new doors to provide services in areas where we do not currently compete.

Speaker Change: It also includes objectives to acquire complementary businesses totaling $150 million in revenues over the next three years.

Speaker Change: We have a healthy funnel of high value complementary acquisition targets and we will continue to focus on the United States, Canada and Western Europe.

Speaker Change: Moving forward our intent is to also deliver an increasing percentage of our business using AI based tools and our smart shoring centers.

Speaker Change: We believe the scaling up of our smart shoring operations will provide us with a greater pool of qualified experts and margin improvements while opening new doors that provide services in areas, where we do not currently compete.

Paul Raymond: Finally, our new three-year plan also lays out steps towards achieving net zero-emission certification.

Paul Raymond: Finally, our new three-year plan also lays out steps towards achieving net zero emission certification. In conclusion, as I've said in the past, there will be more technology in our lives 10 years from now. Technology is once again poised to change the way we work and live, and Alithya is excited to be in a trusted position to help all of our stakeholders harness the tremendous promises of these new technologies. We will now be happy to take questions. Operator?

Speaker Change: Finally, our new three year plan also lays out steps towards achieving net zero emission certification.

Paul Raymond: In conclusion, as I have said in the past, there will be more technology in our lives to nearer now. Technology is once again poised to change the way we work and live, and the leafiest excited to be in a trusted position to help all of our stakeholders harness the tremendous promises of these new technologies.

Speaker Change: In conclusion as I have said in the past there will be more technology in our lives 10 years from now.

Speaker Change: Technology is once again poised to change the way, we work and live and Lithia is excited to be in a trusted position to help all of our stakeholders harness the tremendous promises of these new technologies.

Unknown Executive: We will now be happy to take questions. Operator? Thank you.

Speaker Change: We will now be happy to take questions operator.

Speaker Change: Yeah.

Operator: Thank you. Ladies and gentlemen, should you have a question, please press the star followed by the one on your touchtone phone. If you'd like to withdraw your question, please press the star followed by the two. If you're using a speakerphone, please leave the handset before pressing any keys.

Speaker Change: Thank you ladies and gentlemen should you have a question. Please press the star followed by one on your Touchtone phone if you'd like to withdraw your question. Please press the star followed by the two if you're using a speaker phone. Please lift the handset before pressing any keys.

Unknown Executive: Ladies and gentlemen, should you have a question? Please press the star followed by the one on your touchstone phone. If you'd like to wish a question, please press the star followed by the two. If you're using a speaker phone, please leave the answer before pressing any keys.

Unknown Executive: Bernard thought krill will be managing the Q&A session today, while moment please for your first question.

Operator: Bernard, Dr. Hill will be managing the Q&A session today. One moment, please, for your first question. The first question comes from Gavin Fairweather from Carmark Securities. Please go ahead.

Dr <unk>: Dr <unk> will be managing the Q&A session today.

Speaker Change: Please for your first question.

Graham Smith: Your first question comes from Gavin Fairweather, from Karl Marx's Securities. Please go ahead. Hi there. This is Graham on for Gavin. I just wanted to ask about the cadence of the smart-shore hires. It was about five to six percent of the workforce, and now I think you mentioned it's over eight percent. I know there's been some restructuring, like some head count reduction, but if you could just give a bit more color on sort of that jump in the percentage of smart-shore full-time employees. I'll be great. Thanks. Graham, and good morning.

Speaker Change: Your first question comes from David sure whether from <unk> Securities. Please go ahead.

Gavin Fairweather: Hi there, this is Graham on behalf of Gavin. I just wanted to ask about the cadence of the SmartShore hires. I know last quarter you said it was about 5 to 6 percent of the workforce, and now I think you mentioned it's over 8 percent. I know there's been some restructuring, like some headcount reduction, but maybe if you could just give a bit more color on sort of that jump in the percentage of SmartShore full-time employees, that'd be great, thanks.

Hi, there. This is graham on for Gavin I, just wanted to ask about the cadence of the smarts where hires.

Graham: Last quarter, you said it was about 5% to 6% of the workforce and now I think he mentioned was over 8% I know theres been some restructurings like some head count reduction, but maybe if you could just give a bit more color on sort of that jump in.

Speaker Change: And the percentage of smart sure fulltime employees that'd be great. Thanks.

Bernard Dockrill: Thanks, Graham, and good morning. This is Bernard Dockrell.

Speaker Change: Great. Thanks, Graham and good morning, this is but our doctoral Julie.

Bernard Dockrill: This has been our doctoral, as Julie mentioned. Paul Raymond is actually touring our smart-shore centers right now and is unable to take the call today. So, Claude and I will be filming your questions, and just timely, Graham, but smart-shore question. Yeah. So, we just say to roughly now, on our total workforce, about 8 percent, a little rate percent is now in our smart-shore centers, and our non-course centers out of the US, Canada, and France. And we see that continuing to grow. It definitely is a priority for us. As Claude mentioned in the last call, when we're seeing a lack of the higher-end growth, it is more difficult to ramp up in those centers.

Julie: Julia mentioned.

Speaker Change: Paul Raymond is actually touring our Smart center centers right now and is unable to take the call today, So I'll quote and I will be fielding your questions.

Bernard Dockrill: As Julie mentioned, Paul Raymond is actually touring our SmartShare centers right now and is unable to take the call today, so Claude and I will be fielding your questions, and we'll get back to you with a SmartShort question. Yeah, so we just say roughly now in our total workforce, about 8%, a little over 8% is now in our Smart Shore centers and our non-core centers out of the US, Canada, and France. And we see that continuing to grow.

Speaker Change: And as timely grant with the <unk> question.

Speaker Change: So we just say roughly now our total workforce.

Paul Raymond: At 8% little over 8% is now on our smart shore centers, and our noncore centers out of the U S, Canada and France.

Bernard Dockrill: It definitely is a priority for us. As Claude mentioned in the last call, you know, when we're seeing a lack of hiring growth, it is more difficult to ramp up in those centers as we're not hiring as many. But we are happy with the progress we're making, and we've got continued initiatives to continue this progress in the future quarters.

And we see that continuing to grow it definitely is a priority for us.

Speaker Change: As Claude mentioned I think in the last call when we're seeing.

Lack of a hiring growth it is more difficult to ramp up in those centers.

Graham Smith: As we're not hiring as many, but we are happy with the progress we're making, and we've got continued initiatives to continue to do this progress in future quarters. That's great. Thanks.

Speaker Change: We're not hiring as many.

Speaker Change: But we are happy with the progress, we're making and we've got continued initiatives to continue this progress in future quarters.

Bernard Dockrill: That's great. Thanks. And then just on the bank projects that are sort of starting to come online, could you maybe give us a bit more color? Is that like something that's gonna happen in the second half of, or I guess the first half of fiscal 25, or is that gonna sort of take a few more months as they start to take these dormant products back online? Thanks.

Speaker Change: That's great. Thanks, and then just on the bank projects that are sort of starting to come online.

Bernard Dockrill: And then just on the bank projects that are sort of starting to come online. Could you maybe give us a bit more color? Is that like something that's going to happen in the second half of, I guess, the first half of fiscal 25, or is that going to sort of take a few more months as they start to take these dormant products back online? Thanks. Yeah, great question. We have been seeing a lot more activity on some of the projects that were installed in previous quarters. So, we haven't yet turned into bookings or revenue, but we do anticipate from the activity we're seeing that we will see some of these things come to fruition in the second half of this fiscal year.

Speaker Change:

Speaker Change: Could you maybe give us a bit more color is that like something that's going to happen in the second half of them or I guess, the first half of fiscal 'twenty five or is that going to sort of take a few more months as they start to take these storm and products back online.

Bernard Dockrill: Yeah, great question. We have been seeing a lot more activity on some of the projects that were installed in previous quarters, but we haven't yet turned these into bookings or revenue. But we do anticipate from the activity we're seeing that we will see some of these things come to fruition in the second half of this fiscal year.

Speaker Change: Yes, great question, we haven't seen a lot more activity on some of the projects that were installed in previous quarters.

Speaker Change: So we haven't yet turned into bookings or revenue, but.

Speaker Change: But we do anticipate from the activity, we're seeing that we will see some of these things come to fruition in the second half of this.

Speaker Change: Fiscal year.

Bernard Dockrill: Amazing, and they're just one more for me, so Gross Mart is Robby C. Barry Strong, this quarter, despite the seasonality with the payroll benefits. Is that primarily on strong, you know, project execution? Would you to be that more to that jump in the Smart Shoring, a percentage Smart Shoring? Maybe just some more color on that would be great. Yes, there's a number of factors that are impacting our gross margins. Definitely, our delivery excellence and our delivery project delivery is improving, so margins are going there. The Smart Shoring has a positive impact in creating tailwinds there as well as our utilization.

Bernard Dockrill: Amazing. And then just one more for me.

Speaker Change: Amazing and then just one more for me. So gross margins were obviously very strong this quarter. Despite the seasonality with the payroll and benefits is that primarily on strong project execution would you attribute that more to that jumping to smart shoring our percentage of smart shoring, maybe just some more color on that would be great.

Bernard Dockrill: So gross margins were obviously very strong this quarter, despite the seasonality with the payroll and benefits. Is that primarily due to strong, you know, project execution? Would you attribute that more to that jump in the smart shoring, percentage of smart shoring? Maybe just more color on that would be great.

Speaker Change: Yes, a number of factors that are impacting our gross margin is definitely our delivery excellence and our delivery approach delivery is improving so margins are going there.

Bernard Dockrill: Yes, there's a number of factors that are impacting our gross margins. Definitely, our delivery excellence and our delivery of projects is improving, so margins are going there. The smart shoring has had a positive impact on creating tailwinds there, as well as on our utilization. We've been able to continually step up our utilization. And finally, the last thing is automation. We're seeing more automation in our projects, which allows us to, you know, replace labor completely, which has a great impact on our gross margins.

Speaker Change: Smart shoring has a positive impact in creating teo.

Speaker Change: Tailwind there as well as our utilization we've been able to continue to step up our utilization and finally, the last thing is automation, we're seeing more automation in our projects, which allows us to replace labor completely which has a great impact on our gross margins.

Bernard Dockrill: We've been able to continue to step up our utilization. And finally, the last thing is automation. We're seeing more automation in our projects, which allows us to, you know, play slavery, which has a great impact on our gross margins. That's amazing. I'll pass flying.

Gavin Fairweather: That's amazing; I'll pass the line, thanks.

Speaker Change #100: That's amazing I'll pass the line thanks.

Jerome Dubreuil: Thanks. Here next question comes from Jerome Dubreuil from Desjardins. Please go ahead.

Operator: Your next question comes from Jerome Dubreuil from Desjardins. Please go ahead.

Speaker Change #101: Your next question comes from Jay <unk> from Deutsche Bank. Please go ahead.

Jerome Dubreuil: Thanks for taking my questions Bernard. It's good to hear your voice. The first question is on margin guidance for the longer term. You know, the question we, a lot of people are likely to have is, what are the assumptions behind the long-term guidance on margin, you know, in the past? It's been a challenge to achieve this, but now we're really seeing good momentum. So are there assumptions in terms of organic growth resuming soon? And the second part is, do you see further low-hanging fruit for you to meet that objective?

Jerome Dubreuil: Dear both of the moment, thanks for taking my questions. Bernard, get the hair a voice. First question is on the margin guidance for the longer term. You know, where the question we, a lot of people are likely to have is, what are the assumptions behind the long term guidance on margins? You know, in the past, you know, it's been a challenge to achieve this, but now we're really seeing good, good momentum. So are there assumptions in terms of organic growth resuming soon and second part is new, you see further delaying for you to need that objective fix.

Jay <unk>: Hey, volatile at the moment, thanks for taking my questions, but ill get to hear your voice.

First question is on the margin guidance what are the longer term.

Speaker Change #103: You know where the question we have a lot of people are likely to have this what are the assumptions behind the the long term guidance on margin you know in the past.

Jay <unk>: <unk>.

Speaker Change #104: It's been a challenge to achieve this but now we're really seeing good good momentum. So are there assumption in terms of organic growth resuming soon and second part is when you see further low hanging fruit for you to.

Jay <unk>: To meet that objective.

Bernard Dockrill: Yes, Spencer, over the question. We look forward. We don't give guidance on the future, but, you know, we do see the ability to have more of the smart shorting as we discussed earlier when we get more growth with these are to wrap up quicker in the smart short, and we're seeing our clients much more open to doing more offshore, is looking to get more further dollar. As well as our utilization, we have many great improvements on our utilization. That gets harder and harder to more improvements you make, but there is still some room there we think that we can continue to get better there.

Bernard Dockrill: Thanks, Jerome, for the question. We look forward, and we don't give guidance for the future, but you know. We do see the ability to have more of the smart shoring. As we discussed earlier, when we get more growth, it's easier to ramp up quicker in the smart shoring. And we're seeing our clients much more open to doing more offshore as they're looking to get more for their dollar, as well as our utilization.

Speaker Change #105: Yes, thanks for the question.

Speaker Change #106: We look forward.

Speaker Change #106: And we don't give guidance on future but.

Speaker Change #106: We do see the ability to add more of the smart shoring as we discussed earlier when we get more gross it's easier to ramp up quicker and the smart short and we're seeing our clients.

Speaker Change #106: Much more open to doing more offshore as theyre looking to get more for their dollar.

Speaker Change #106: As well as our utilization we have made great improvements on our utilization.

Bernard Dockrill: We have made great improvements in our utilization, and that gets harder and harder the more improvements you make. But there is still some room there, we think, that we can continue to get better there. And as I mentioned before, our delivery excellence. We put a lot of programs in place over the last year, and we've seen great rewards from that in doing that. So I continue to expect that we'll see some there.

Speaker Change #106: It gets harder and harder to more improvements are great, but there is still some some room there and we think that we can continue to get better there and as I mentioned before our delivery excellence, we put a lot of programs in place over the last year and we've seen great rewards from that and doing that so I continue to.

Bernard Dockrill: As I mentioned before, our delivery axons put a lot of programs in place over the last year, and we've seen great rewards from that and doing that. So I continue to expect that we'll see some there. On the gross side, you know, the markets are challenging market right now as you're seeing with interest rates. But we are doing a scene some activity that makes us feel that the second half of the year we may return to the gross levels over that previously.

But we will see some there.

Bernard Dockrill: But on the growth side, the market's a challenging market right now, as you can see with interest rates. But we are seeing some activity that makes us feel that in the second half of the year, we may return to the growth levels that were previously.

Speaker Change #106: But on the gross side.

Speaker Change #107: It's a challenging market right now as youre seeing with interest rates.

Speaker Change #108: But we are doing is seeing some activity that makes us feel that the.

The second half of the year, we may return to the growth levels that.

Speaker Change #109: Pat previously.

Bernard Dockrill: Great, taking the question for me, just a clarification: is the healthcare deal with government come back included in the quarters looking? Yes, the all the two deals I mentioned in my remarks, the healthcare deal in Quebec as well as the large healthcare deal that we had in the U.S., both of those deals were in our Q4 bookings and provided a good help lift to those bookings in the border. That's good to hear.

Bernard Dockrill: Great. Second question for me, just a clarification. Is the health care deal with the government in Quebec included in the quarterly booking?

Speaker Change #110: Great second question, if I may just a clarification is the healthcare deal with government Tabak included in the quarter's bookings.

Bernard Dockrill: Yes, that deal, and the two deals I mentioned in my remarks there, the health care deal in Quebec, as well as the large health care deal that we had in the U.S., both of those deals were in our Q4 bookings and provided a good uplift to those bookings in the quarter.

Speaker Change #111: Yes that deal the two deals I mentioned in my <unk>.

Speaker Change #111: Remarks, there the healthcare deal in Quebec, as well as the large.

Speaker Change #112: Health care deal that we had.

Speaker Change #112: U S. Both of those deals were in our Q4 bookings and provided a good uplift to those bookings in the quarter.

Bernard Dockrill: And finally, for me, are you happy with the current mix of managed services? I mean, a lot of companies in the space have been using a higher mix of managed services in order to get better utilization. Is this something you're looking at to kind of transition your model towards, or are you happy with the current mix? Definitely managed services.

Speaker Change #113: That's good to hear.

Bernard Dockrill: And finally, for me, are you happy with the current mix of managed services? I mean, a lot of companies in the space have been using a higher mix of managed services in order to get better utilization. Is this something you're looking at to kind of transition your model towards, or are you happy with a certain mix? Definitely managed services provides a lot of advantages to our work, not just in the, you know, the margins on the managed services work, but also the launcher nature of managed service contracts. So a lot of the implementation work we do, a lot of our European implementation work we do more proactive on including managed service options and those agreements which create a scale to those agreements. So definitely we'd like to see more managed services. Does provide advantages to our services mix, it also reduce risks and future borders as well.

Speaker Change #114: Finally for me.

Speaker Change #115: Are you happy with the current mix of managed services I mean, a lot of companies in the space.

Speaker Change #116: We have been using a higher mix of managed services in order to get better utilization.

Speaker Change #117: Is this something youre looking at to kind of transition your model towards or you're happy with your current mix.

Bernard Dockrill: Definitely managed services provides a lot of advantages to our work, not just in the margins on the managed services work but also the long-term nature of managed service contracts. So a lot of the implementation work we do, a lot of our ERP implementation work we do, is more proactive in including managed service options in those agreements, which creates a tail to those agreements. So definitely, we'd like to see more managed services. It does provide advantages to our services mix that also reduce risks in future borders as well. So it is part of our strategy to increase that.

Speaker Change #118: Definitely managed services provides a lot of advantages to our work not just in the.

Speaker Change #118: Okay.

Speaker Change #118: The margins on the managed services work, but also the.

Speaker Change #118: The long term nature of managed service contracts. So a lot of the implementation work, we do a lot of our ERP implementation work we do.

Speaker Change #118: More proactive odd, including managed service options in those agreements, which create a tail to those agreements.

Speaker Change #118: So definitely we'd like to see more managed services does provides advantages to our.

Speaker Change #119: Two our services mix that also reduce risks in future quarters as well. So it is part of our strategy to increase that.

Bernard Dockrill: So it is part of our strategy to increase that.

Bernard Dockrill: Great, thanks a lot.

Speaker Change #120: Great. Thanks, a lot.

Rob Jeff: You're next question, come some Rob Jeff from Ashland, please go ahead. Good morning, and congratulations on the margin performance. It is very impressive. Thank you.

Operator: Your next question comes from Rob Jeff from Ashland. Please go ahead. Good morning.

Speaker Change #121: Your next question comes from Rob Jost from.

Shlomi: Shlomi. Please go ahead.

Robert Goff: Good morning, and congratulations on the margin performance. It's very impressive. Thank you. Welcome, and perhaps going back to the ERP win in Quebec, can you discuss how you're working with Oracle and IBM and the broader scope of that contract? And with that contract, would your share of that contract be relatively consistent with the win announced in the US in terms of scale?

Unknown Executive: Good morning, and congratulations on the margin performance.

Shlomi: Impressive.

Thank you.

Bernard Dockrill: Uh, maybe if you can clarify your question as far as the relative scale to the U.S. It's uh, the contract in Canada is slightly larger than the one that we had in the U.S., from our portion, and it is a consortium where we are one player in that delivery team. LGS is the system integrator, and, of course, Oracle is the software provider.

Rob Jeff: Welcome, and perhaps going back to the ERP win in Quebec. Can you discuss your, how are you working with Oracle and IBM and the broader scope of that contract? And with that contract, would your share of that contract be relatively consistent with the win announced in the US in terms of scales? If you can clarify your question and as far as the rail to scale to the US, it's the, the contract can count as slightly larger than the one that we had in the US. From our portion, and it is a consortium where we are one player in that delivery team, LGS is the system integrator and, of course, Oracle is the software provider.

Speaker Change #124: Welcome and perhaps going back to the ERP win in Quebec can you discuss your how you're working with Oracle and IBM and the broader scope of that contract.

Speaker Change #125: And with that contract would your share of that contract.

Speaker Change #124: B.

Speaker Change #126: Relatively consistent with the win announced in the U S in terms of scale.

Speaker Change #126: Maybe if you can clarify your question there as far as the relative scale to the U S.

Speaker Change #127: The contract in Canada is slightly larger than the one that we had in the U S.

Speaker Change #127: From our portion of it is a consortium.

Speaker Change #127: We are one one player in that.

Speaker Change #128: Delivery team.

Speaker Change #128: Yes.

Speaker Change #128: The system integrator and of course, Oracle as the software provider.

Bernard Dockrill: Thank you. Sure, is this a partnership that could pre pursuing similar contracts in other provinces or. Yeah, Oracle is one of our primary partners, so we do a lot of work with Oracle through our Oracle Club in the ERP specifically in healthcare and also in the PM space. So that's a partnership that's been around for a long time. And even with LGS here in Quebec and other areas we have partnered in the past. And as we look at the deal, we look at every deal independently and what is the best solution for our client. And if that involves partnering, we'll look at the partner and ecosystem and pick the best partner for the individual.

Bernard Dockrill: Is this a partnership that could be pursuing similar contracts in other provinces?

Speaker Change #129: Yeah, that's a good question.

Speaker Change #130: And is this a partnership that could.

Speaker Change #130: <unk> pursuing similar contracts in other provinces.

Bernard Dockrill: Oracle is one of our primary partners, so we do a lot of work with Oracle through our Oracle Cloud for ERP specifically in healthcare and also in the EPM space. So that's a partnership that's been around for a long time. And even with LGS here in Quebec and other areas, we have partnered in the past. And as we look at every deal, we look at every deal independently and determine what is the best solution for our client.

Speaker Change #131: Oracle is one of our primary partner so we do a lot of work with Oracle through our Oracle cloud ERP, specifically in health care and also in the APM space. So that's a partnership that's been around for a long time, and even with lgs here in Quebec and other other areas.

Speaker Change #131: We have partnered in the past.

Speaker Change #131: And as we look at every deal we look at every deal independently and what is the best solution for our client.

Bernard Dockrill: And if that involves partnering, we'll look at the partner and ecosystem and pick the best partner for the individual opportunity that we have. But definitely, where we are right now with LGS, this is a very positive partnership that we have going.

Speaker Change #131: And if that involves partnering we will look at the partner ecosystem.

Speaker Change #132: The best partner for the individual.

Bernard Dockrill: I'm sure that we have, but definitely where we are right now with LGS, this is a very positive partnership that we have going.

Speaker Change #132: Opportunity that we have but definitely where we are.

Speaker Change #132: Right now with the <unk>. This is a very positive partnership that we have going.

Bernard Dockrill: And, Cass, in terms of Canada, you're talking about increased activity with the banks and how that's a second half consideration. Do you see Canada returning to year-on-year growth in the second half?

Speaker Change #133: Mhm and cash in terms of Canada, you are talking about the increased activity with the banks and how thats a second half <unk>.

Bernard Dockrill: And in terms of Canada, you're talking with the increase activity with the banks and how that's a second half consideration. Do you see cans of returning to you're on your growth in the second half. And this says, you know, we don't provide guidance, but the activity we're seeing and what we're starting here in the first quarter, we've got some flocking in Canada, and Quebec, and outside of Quebec. So I do see from the activity our pipeline is strong. One of the things we're seeing is larger deals in our pipeline or strategic deals. We're involved in the client side and the decision making for Flex, but it provides us with a very positive forecast as we look forward.

Speaker Change #134: Consideration can you see Canada, returning to year on year growth in the second half.

Speaker Change #134: Sure.

Bernard Dockrill: As you know, we don't provide guidance, but based on the activity we're seeing and what we started here in the first quarter, we've got some people working in Canada, in Quebec, and outside of Quebec. So I do see from the activity that our pipeline is strong. One of the things we're seeing is larger deals in our pipeline, more strategic deals. Of course, those deals take longer to close; there are more people involved on the client side, and the decision-making process is less. But it provides us with a very positive forecast as we look ahead.

Speaker Change #134: Yeah.

Speaker Change #135: We don't provide guidance, but with the activity, we're seeing and hearing.

Speaker Change #136: What we started here in the first quarter.

Speaker Change #137: Look at some of the bookings in Canada.

Speaker Change #137: In Quebec and outside of Quebec, So I do see some activity our pipeline is strong.

Speaker Change #138: One of the things, we're seeing is larger deals in our pipeline more strategic deals.

Speaker Change #138: Those deals take longer to call, which theres more more people involved in the client side and the decision making.

Speaker Change #138: Blacks.

Speaker Change #138: But it provides us with a.

Speaker Change #138: Very positive.

Speaker Change #138: Forecast as we look forward.

Bernard Dockrill: Thank you.

Speaker Change #139: Thank you.

John Shao: Your next question comes from John Shao from National Bank; please go ahead. A good morning. Thanks for taking my question on smart shoring.

Operator: Your next question comes from John Schahel from National Bank. Please go ahead.

Your next question comes from Jon Chappell from National Bank. Please go ahead.

John Schahel: Hey, good morning. Thanks for taking my question. On smart shoring, could you maybe remind us what needs to be done here in order to potentially close down the gaps relative to your peers who have a much higher mix, and how should we think about the pace of acceleration on that front?

Jon Chappell: Hey, good morning, Thanks for taking my question.

Speaker Change #141: On smart shoring could you maybe remind us what needs to be done here to potentially close down the gaps relative to your peers, who has a much higher mix and how should we think about the pace of acceleration.

Bernard Dockrill: Could you maybe remind us what needs to be done here and also potentially close down the gaps relative to your peers who has a much higher mix, and how should we think about the pace of acceleration on that front? Thanks for your question, John. And yeah, smart shoring. There's a few things that we're looking at. There's, first of all, that are client delivery, which is the primary focus of our smart short. And then also internally on some of our general operations and moving more that to our smart short center. So we have threads, if you will, that we're seeing to grow those centers.

Speaker Change #141: On that front.

Bernard Dockrill: Thanks for your question, John. And yeah, Smart Shore, there's a few things that we're looking at. There's, first of all, our client delivery, which is the primary focus of our Smart Shore. And then also internally on some of our internal operations and moving more of that to our Smart Shore Center. So we have threads, if you will, that we're pursuing to grow those centers. As I mentioned before, as we look at new contracts that we're signing with our clients, there's more and more SmartShore delivery built into those contracts.

John: Okay. Thanks for your question, John Yes, Smart store Theres, a few things. We're looking at there is first of all of our client delivery, which is the primary focus of our smart sure.

Speaker Change #143: And then also internally on some of our internal operations and moving more of that to our smart shore centers. So we have <unk>.

Speaker Change #143: <unk>, if you will that we're pursuing to grow those centers.

Bernard Dockrill: As I mentioned before, as we look at new contracts that we're signing with our clients, there's more and more smart short delivery built into those contracts. And in some of our past contracts, it's tough to move because we've contracted sometimes on where we deliver the work from. So we're limited there, but as we grow and we renew these contracts, we are accelerating that. And as I mentioned before, our clients are very interested in it. I think in most industries right now, they're looking for further savings for their operational efficiencies. And smart shoring is one of the levers that we can pull.

Speaker Change #144: As I mentioned before is when you look at new contracts that we're signing with our clients there is more and more smart sure deliver.

Speaker Change #144: Delivery built into those contracts and such.

Bernard Dockrill: In some of our past contracts, it's tough to move because we've contracted sometimes on where we deliver the work from, so we're limited there, but as we grow and we renew these contracts, we are accelerating that. And as I mentioned before, our clients are very interested in it. I think in most industries right now, they're looking for further savings, further operational efficiencies. And SmartTrolling is one of the levers we can pull.

Speaker Change #144: Some of our bass contracts, it's tough to move because we've contracted sometimes on where we deliver the work from.

Speaker Change #144: So we're limited there, but as we grow and we renew these contracts we are accelerating that as I mentioned before our clients are very interested in it I think.

Speaker Change #145: And most industries right now Theyre looking for further savings further operational efficiencies and smart showing as one of the levers we can pull of course, it's not the only lever we're looking more at the automation front as well.

Bernard Dockrill: Of course, it's not the only lever. We're looking more at the automation front as well to drive further efficiencies for both us and our clients. But as we do grow and we sign these new contracts, I do expect that our smart short percentage will continue to go in the right direction.

Bernard Dockrill: Of course, it's not the only lever we're looking at; we're more at the automation front as well to drive further efficiencies for both us and our clients.

Speaker Change #145: To drive further efficiencies for both us and our clients.

John Shao: But as we do grow and we sign these new contracts, I do expect that our smart short percentage will continue to go in the right direction. Okay, thanks for the colors.

Speaker Change #145: But as we do grow when we signed these new contracts I do expect that our smart short percentage will continue to go in the right direction.

John Schahel: Okay, thanks for the colors. In terms of the demand environment, it sounds like demand is about to return. On that note, how should we think about your staff utilization or capacity to potentially take on more projects?

Speaker Change #146: Okay. Thanks for the colors and in terms of the demand environment. It sounds like demand start to return and on that note. How should we think about your staff utilization of capacity to potentially take on more projects.

John Shao: And in terms of the demand environment, it sounds like demand is about to return. On that note, how should we think about your staff utilization or capacity to potentially take on more projects? That's a great question. There's only so much you can do with utilization. At some point, it's just that having the right skills available for the new projects coming on. So we are very actively analyzing our pipeline and ensuring that what we have is available is bench capacity aligns to the work we're seeing demands from our clients. So that's kind of the key activity to make sure we can do that.

Bernard Dockrill: Yeah, great question. You know, there's only so much you can do with utilization. At some point, it's just having the right skills available for the new projects coming on. So we are very actively analyzing our pipeline, ensuring that what we have available as bench capacity aligns to the work we're seeing demands for from our clients. So that's kind of the key activity to make sure we can do that. But also, you know, going to the market, bringing in new talent as we bring in these new deals.

Speaker Change #147: Yeah, Great question. So there's only so much you can do with utilization.

Speaker Change #148: At some point, it's just that having the right skills available for the new projects coming on so we are very actively.

Speaker Change #148: <unk> our pipeline ensuring that what we have is available as a bench capacity aligns to the work we're seeing demands from them from our clients.

Speaker Change #148: So that's that's kind of the key activity there to make sure we can do that but.

Bernard Dockrill: But also, you know, going to the market, bringing on new talent as we bring on these new deals. You know, the deal here that we signed here in Quebec requires us to hire as well. We didn't have all that capacity sitting idle. So, as we do that, we bring them on. Of course, that has a little bit of an impact to your utilization as you, when you bring on the team, you have training ramp up where folks may not be available. So some of that has a bit of a headwind on that. But I do see, as we grow, there will be a little bit in the utilization as it, you know, stabilizes.

Speaker Change #149: But also go into the market, bringing on new talent as we bring on these new deals.

Bernard Dockrill: You know, the deal that we signed here in Quebec requires us to hire as well. We didn't have all that capacity sitting idle. So as we do that, we bring them on board. Of course, that has a little bit of an impact on your utilization as when you bring on the team, you have training ramp-up where folks may not be available. So some of that has a bit of a headwind on that, but I do see as we grow, there will be a little bit of improvement in the utilization as it, you know, stabilizes.

Speaker Change #150: We signed here in Quebec requires us to hire as well.

Speaker Change #150: Have all of that capacity.

Speaker Change #150: Sitting idle so as we do that we bring them on and of course that has a little bit of an impact to your utilization as you. When you bring on the team you have training.

Speaker Change #150: A wrap up.

Speaker Change #150: Folks may not be available. So some of that has a bit of a headwind on that.

Speaker Change #150: I do see it as we do.

Grow there will be a little bit of improvement in the utilization.

Speaker Change #151: Is it.

Speaker Change #151: Stabilizes.

John Shao: It got it thanks against the colors that pop along.

John Schahel: Got it. Thanks again to the callers that dropped the line.

Speaker Change #152: Okay got it thanks again for the color of that top line.

Vincent Colicchio: Your next question comes from Vincent Colicchio from Barrington Research. Please go ahead. Yes, Bernard, are you seeing engagements ramp in alignment with your expectation, and in particular, I'm interested in the two large health care deals you signed last quarter? As far as our ramp up on that? Yeah, it's ramping according to plan. Yes, so again large initiatives, they're multi-year initiatives so it's not all ramping up at one time, so we'll take a quarter or two before they ramp up probably to keep capacity. And the large deal in Quebec, of course, it's a five-year implementation and has a managed services tail on it as well for several years, so you know the revenue is spread over that period of time. But the deal in the US, we are ramping that up and it'll ramp up over the next two quarters or so.

Operator: Your next question comes from Vincent Colicchio from Barrington Research. Please go ahead.

Speaker Change #153: Your next question comes from Vincent Colicchio from Barrington Research. Please go ahead.

Vincent Alexander Colicchio: Yes, Bernard, are you seeing engagements ramp in alignment with your expectations in a particular arm? Are you interested in the two large health care deals you signed last quarter?

Speaker Change #152: Okay.

Speaker Change #152: Yes.

Vincent Alexander Colicchio: Are you seeing any.

Speaker Change #155: <unk> ramp.

Speaker Change #155: In alignment with your expectation in particular.

Speaker Change #156: Interested in the two large health care deals you signed last quarter.

Bernard Dockrill: As far as our wrap-up on that,

Speaker Change #157: As far as our ramp up on that.

Vincent Alexander Colicchio: Yeah, is it ramping according to plan?

Speaker Change #157: Yes.

Speaker Change #157: Ramping according to plan.

Bernard Dockrill: Yes, so these are, again, large initiatives. They're multi-year initiatives, so it's not all ramping up at one time. So it will take a quarter or two before they ramp up probably to peak capacity. And the large deal in Quebec, of course, is a five-year implementation. It has a managed services tail on it as well for several years. So, you know, the revenue is spread over that period of time. But the deal in the U.S., we are ramping that up, and it'll ramp up over the next two quarters or so.

Speaker Change #157: Yes. So these are again large initiatives, they're multiyear initiatives.

Speaker Change #157: Not all ramping up at one time, so it will take a quarter or two before they ramp up probably the peak capacity and the large deal in tobacco of course, it's a five year implementation as a managed service is tail on it as well for several years.

Speaker Change #157: So the revenue is spread over that period of time.

Speaker Change #157: But the deal in the U S. We are ramping that up and it will ramp up.

Speaker Change #157: The next two quarters or so.

Vincent Colicchio: And then overall you're seeing a slowing and ramping to an extent. Slowing of new projects or? Yes, yes, new projects. Yeah, a little bit of dynamics they're going on.

Vincent Alexander Colicchio: And then overall, you're seeing a slowing and ramping to an extent.

Speaker Change #158: And then overall are you seeing a slowing in ramping to an extent.

Vincent Alexander Colicchio: Slowing down new projects or? Yes, yes, new projects. A little bit of the dynamics that are going on.

Speaker Change #158: Slowing of new projects or yes, yes, new projects.

Bernard Dockrill: One of the things we see in our pipeline is, especially in the ERP space, we're bidding on more multi-pillar contracts, so contracts that include ERP, SCM, HCM, and EPM. And of course, those are larger, more complex deals. There are a lot more buyers involved in the decision-making, the lines of business, and IT. So they take a little longer to close, but they're larger as well.

Speaker Change #158: We're a little bit of the dynamics that are going on one of the things we see in our pipeline is especially in the ERP space, we're bidding on more multi color.

Vincent Colicchio: One of the things we see in our pipeline is especially in the ERP space we're bidding on more multi-tiller contracts so contracts include you know ERP, SCM, HCM, EPM and of course those are are larger and more complex deals. There's a lot more buyers involved in the decision making you know the lines of business, the IT so they take a little longer to close but they're you know they're larger as well so it's you know it's a good outcome for us and again the two big wins that we had in 2-4 specifically in our Oracle practice that did take a lot of energy the team there to close those deals. So right now we're you know refilling the coverage if you will with new deals in that space as we you know we did that we did close the successfully some a couple of big deals which impact our our our pipeline.

Speaker Change #158: Contracts so contracts that include <unk>.

Speaker Change #158: ERP SCM HCM.

Speaker Change #158: And of course, those are larger more complex deals there is a lot more buyers involved in the decision making.

Speaker Change #158: The lines of business.

Speaker Change #158: Yeah.

Speaker Change #158: So they take a little longer to close.

Speaker Change #158: But there they're larger as well so.

Speaker Change #158: Okay.

Vincent Alexander Colicchio: So it's... It's a good outcome for us. And again, the two big wins that we had in Q4, specifically in our Oracle practice.

Speaker Change #158: It's a good outcome for us.

Speaker Change #159: And again were the two big wins that we had in Q4, specifically in our Oracle practice.

Speaker Change #159: <unk> taken a lot of energy of the team there to close those deals so right our.

Speaker Change #160: Refilling in the that covered if you will with new deals.

Speaker Change #160: That space.

Speaker Change #160: We did that we did flow was successfully some big deals which impact our pipeline.

Vincent Colicchio: Then the digital training business has been a laggard. Is that now on firmware footing? Yeah, very interesting question. We look at our digital adoption practice, and you may have seen the press release on our full pilot academy. That's that group combined with our Microsoft teams delivering that, so we are seeing a bit of an uptick there. As we look at the AI space, there's a lot of adoption around AI. The market is looking for help on how does it fit in. So this is a profile academy, something we put together to not only train our internal people but our clients and prospects on AI. We do see a lot of demand in our digital adoption team with AI training.

Vincent Alexander Colicchio: Then the digital training business has been a laggard; is that now on firmer footing?

Speaker Change #161: And then the digital training business has been a laggard is that now on firmer footing.

Bernard Dockrill: Yeah, very interesting question, Vincent. We look at our digital adoption practice, and you may have seen the press release on our Copilot Academy. That's that group combined with our Microsoft team delivering that. So we are seeing a bit of an uptick there as we look at the AI space. There's a lot of adoption around AI, and the market is looking for help on how it fits in. So this is a co-pilot academy, something we put together to not only train our internal people but our clients and prospects on AI. We do see a lot of demand in our digital adoption team for AI training.

Speaker Change #162: Yes, very interesting question Vincent we look at our digital adoption practice.

Speaker Change #162: You may have seen.

Vincent Alexander Colicchio: A press release on our full pilot Academy, that's that group combined with our Microsoft team delivering that so we are seeing a bit of an uptick there as we look at the AI space, There's a lot of adoption around AI.

Vincent Alexander Colicchio: Market is looking for help on how does it fit in so this is a co pilot Academy is something we put together to not only train our internal people but.

Vincent Alexander Colicchio: Our clients and prospects.

Speaker Change #163: On AI, we do see a lot of demand in our digital adoption team.

Speaker Change #163: With AI training.

Vincent Colicchio: Okay, thanks for answering my questions.

Vincent Alexander Colicchio: Okay, thanks for answering my question.

Speaker Change #164: Okay. Thanks for answering my questions.

Divya Goyal: Thank you. Ladies and gentlemen, as a reminder, should you have a question, please press star one. Your next question comes from Divya Goyal, from Scotia Bank. Please go ahead.

Speaker Change #165: Thank you.

Operator: Ladies and gentlemen, as a reminder, should you have a question, please press star 1. Your next question comes from Divya Goyal from Scotiabank. Please go ahead.

Ladies and gentlemen, as a reminder, should you have a question. Please press star one.

Speaker Change #166: Your next question comes from <unk> <unk> with Scotiabank. Please go ahead.

Divya Goyal: Good morning, everyone. Nice to speak to you here, Bernard. I wanted to get some more color on the data acquisition. There was a pretty sizable recovery on the earn out recorded in the numbers this morning when we were viewing them, trying to understand and a little, and are there a dish? Could there be a potential? I apologize, Divya; you broke up at the end. Do you repeat the last half of the question? Yeah, I was just, yeah, I wanted to get a little more color in the numbers that we're pleased with this morning. Or could we expect for the recovery based on how to deal with it?

Speaker Change #166: Okay.

Divya S. Goyal: Good morning, everyone. Nice to speak to you here, Bernard. I wanted to get some more color on the data acquisition. There was a pretty sizable recovery on the earn out recorded in the numbers this morning when we were viewing them, trying to understand a little. Could there be potential?

Good morning, everyone nice to speak to you Bernard.

Bernard: I wanted to get some more color on the data acquisition there was a pretty sizable recovery on that are not recorded in the numbers. This morning, when we were billing them.

Speaker Change #168: Trying to understand a little bit.

Speaker Change #168: And are there.

A dish.

Speaker Change #168: Could there be a potential.

Speaker Change #168: Okay.

Divya S. Goyal: I apologize, Divya, you broke up at the end. Could you repeat the last half of the question?

Speaker Change #169: I apologize you broke up at the end if you could repeat the last half of the question.

Divya S. Goyal: Yeah, I just wanted to get a little more. In the numbers that were released this morning, are they not scheduled, and could we expect further recovery based on this time?

Speaker Change #170: Yeah I was just.

Speaker Change #170: Okay.

Speaker Change #171: Yeah, I wanted to get a little more color.

Speaker Change #172: In the numbers that please good morning.

Speaker Change #173: Thank you for not scheduled and could we expect for the recovery based on that.

Speaker Change #172: Yeah.

Speaker Change #172: Okay.

Bernard Dockrill: Yeah, I still can't hear you, Divya, but I believe your questions around the data acquisition and the earn out and the progress we've made there and what we looked at there. So yes, that was the one-time adjustment there was with regards to earn out there based on our results in the last year. As we looked to the forecast and part of that data acquisition was the rapid suite of products, and there's a couple of things in the rapid suite that right now have a lot of traction in the market. You've heard Paul talk a lot before about the rapid capture, which is a utility, which is AI enabled for capturing paper and other unstructured data and, you know, putting that into systems. There's a lot of demand for that.

Bernard Dockrill: I still can't hear you, Divya, but I believe your questions around data, data acquisition, and the earn out and the progress we've made there and what we looked at there. So, yes, that was the one time adjustment there was with regard to the earn out there based on our results in the last year.

Speaker Change #174: I still can't hear you gave you, but I believe your questions around <unk>.

Speaker Change #175: The data acquisition and the earn out and the progress we have made there and what we looked at there so.

Yes that was the one time adjustment there was with regards to the earn out there based on.

Speaker Change #176: Our results in the last year.

Bernard Dockrill: As we look to the forecast, and part of that data acquisition was the rapid suite of products, and there's a couple of things in the rapid suite that right now have a lot of traction in the market. You've heard Paul talk a lot before about the rapid capture, which is a utility that is AI-enabled for capturing paper and other unstructured data. And, you know, bringing that into systems, there's a lot of demand for it. Some of the existing clients actually have ramped up their usage of that product.

As we look to the forecasts and part of that data acquisition was the rapid suite of products.

Speaker Change #176: And there's a couple of things in the rapid suite.

Speaker Change #177: Right now have a lot of traction in the market you've heard Paul talked a lot before about the rapid capture.

Speaker Change #177: Which is a utility which is AI enabled for capturing paper and other unstructured data.

And.

Paul Raymond: Bringing that into systems, there's a lot of demand for that and some of the existing clients actually have ramped up their usage of that product. So we see positive trends there.

Bernard Dockrill: Some of the existing clients actually have ramped up their usage of that product. So we see positive friends there. We also with the rapid BRX tool that we have from that acquisition, which helps with legacy application modernization. You heard in my remarks, I spoke a little bit about some pickup on what we're seeing in both the team in the US market around the move to the cloud and that tool is quarter what we're seeing there. So we're using some opportunities this year that bundle with some of our other capabilities as well. So taking what we got from the data acquisition, bundling it with our AWS and our Microsoft practices.

Bernard Dockrill: So we see positive trends there. We also have the Rapid BRX tool that we have from that acquisition, which helps with legacy application modernization. You heard in my remarks, I spoke a little bit about some pickup in, what we're seeing in both the Canadian and the US market around the move to the cloud. That tool is core to what we're seeing there. So we're seeing some opportunities this year, that bundled with some of our other capabilities as well.

Paul Raymond: We also with the rapid <unk> tool that we have from that acquisition, which helps with the legacy application modernization.

Speaker Change #178: Heard in my remarks that I spoke a little bit about some pickup on.

Speaker Change #179: What we're seeing in both the Canadian and the U S market around the move to the cloud.

Speaker Change #180: And that tool as quarter, what we're seeing there. So what are you seeing some opportunities this year.

Speaker Change #181: <unk> bundled with some of our other capabilities as well so taken what we got from the data acquisition bundling it with our with our AWS or Microsoft practices.

Bernard Dockrill: So, taking what we got from the data acquisition, combining it with our AWS and our Microsoft practices, there is a lot, a lot of activity right now. So, I do think the next year could show different outcomes than what you saw in the last year.

Claude Thibault: There is a lot of activity right now. So I do think the next year could show different outcomes that we saw in the last year. Sorry, I just wanted to add; I think you asked about future adjustments, and what we did in Q4 reflects our most recent forecast for data. The earn-out period ends next year. So this reflects our most recent forecast. So we are not expecting right now to have further adjustments to the year now. If that was the question, I also could not hear you very well. My apology is probably the network here.

Speaker Change #181: There is a lot lot of activity right now so.

Speaker Change #181: I do think that next year could show different outcomes and what you saw in the last year.

Speaker Change #182: And there'll be a bernard.

Claude Thibault: Sorry, I just wanted to add, I think you asked about future adjustments, and what we did in Q4 reflects our most recent forecast for Datum. The earn-out period ends next year, so this reflects our most recent forecast. So we're not expecting right now to have further adjustments to the earn-out. If that was the question, I also could not hear you very well.

Speaker Change #183: Go ahead, sorry, I just wanted to add I think you asked about future adjustments and what we did in Q4 reflects our most recent.

Speaker Change #184: A recent forecast for data the earn out period ends next year. So this reflects our most recent forecast. So we are not expecting right now to to have further adjustments to the earn out.

Speaker Change #185: If that was the question I also cannot hear you very well.

Divya S. Goyal: My apologies, it's probably the network here. Yeah, I was actually trying to understand the earnouts that are scheduled for ADEM. Are there further earnouts scheduled? It sounds like you're not expecting recoveries, but are there further earnouts scheduled with ADEM?

Speaker Change #186: My apologies its probably the network here.

Claude Thibault: Yeah, I was actually trying to understand the urnouts that are scheduled for the item or the further urnout schedule. It sounds like you're not expecting copies, but are there further urnout schedules with data? Yes, so we have a, as I said, the urnout period ends next year, June 30th. So we are currently expecting to make a payment on the urnout based on the good performance of that acquisition, as Bernard explained very well.

Speaker Change #187: Yeah, I was actually trying to understand the earn outs that are scheduled for EDAM are therefore for there are now scheduled it sounds like youre not expecting recoveries, but are therefore, there are now scheduled for data.

Claude Thibault: Yes, so we have an, as I said, the earn-out period ends next year, June 30th, so we are currently expecting to make a payment on the earn-out based on the good performance of that acquisition, as Bernard explained very well.

Speaker Change #188: Yes, so we have a as I said the earn out period ends next year June 30th. So we are currently expecting to make a payment on the earn out based on the good performance of the of that acquisition.

As Bernard explained very well.

Claude Thibault: That's helpful. And I know you don't provide the net earnings guidance, but obviously, this time the net earnings look pretty healthy. Could you provide some directional cadence on how should we expect to see net earnings in the quarters ahead?

Speaker Change #188: Sure.

Divya S. Goyal: That's helpful. And I know you don't provide net earnings guidance, but obviously, this time, the net earnings look pretty healthy. Could you provide some directional guidance on how we should expect to see net earnings in the quarters ahead?

Speaker Change #189: That's helpful and I know you don't provide the net earnings guidance, but obviously this time than at earnings look pretty healthy.

Speaker Change #190: Could you provide some directional cadence on how should we expect to see net earnings in the quarters ahead.

Claude Thibault: Maybe Bernard, I can answer this one. So if you look at our financial statements, you can see that what has been keeping us from reaching positive accounting net earnings has been mainly immortalization and depreciation, and also integration acquisition and reorganization cost. And the most recent year we've made the reductions in headcount. And we've had some severance charges fairly significant, and also interest charges is something we need to look at. So all these buckets are expected to decrease going forward. As we go forward, the monetization depreciation goes down. We're paying down debt, as I explained. So interest is going down.

Bernard: Maybe Bernard I can answer this one.

Speaker Change #190: Yes.

Claude Thibault: Maybe Bernard, I can answer this one. All right, so. If you look at our financial statements, you can see that what has been keeping us from reaching positive accounting net earnings has been mainly amortization and depreciation and also integration, acquisition, and reorganization costs. In the most recent year, we've made reductions in headcount. And we've had some severance charges, fairly significant. And also interest charges are something we need to look at. So all these buckets are expected to decrease going forward.

Speaker Change #190: So.

Bernard: If you look at our financial statements you can see that what has been.

Bernard: Keeping us from reaching positive accounting net earnings has been mainly amortization and depreciation and.

Speaker Change #191: And also integration.

Speaker Change #192: Acquisition and reorganization cost in the most recent year, we've made reductions in head count.

Speaker Change #193: And we have had some severance charges are fairly significant.

Speaker Change #193: And also interest Chargers is is something we are we need to look at so all of these buckets are expected to decrease going forward.

Claude Thibault: As we go forward, amortization depreciation goes down, we're paying down debt, as I explained, so interest is going down. The interest rate has also gone down a bit, as you saw recently. And finally, we've reached a comfortable level for now in terms of reductions to SG&A, so severance payments should be going down, too. So if you look at our information for Q4, you can see the amount that the non-recurring amount that helped us become positive, which obviously will not be there going forward, but we're still aiming to become net earnings positive over the coming quarters.

Speaker Change #193: As we go forward that amortization depreciation goes down we're paying down debt as I explained so interest is going down the interest rate has also gone down a bit.

Claude Thibault: The interest rate has also gone down a bit, as you saw recently. And finally, we've reached a comfortable level for now in terms of reductions to SGNA. So that to severance payments should be going down. So if you look at our information for Q4, you can see the amount that the non-recurring amount that help us becoming positive, which obviously will not be there going forward. But we're still aiming to become net earnings positive over the coming quarters. And that's helpful.

Speaker Change #193: You saw recently.

Speaker Change #193:

Speaker Change #193: And finally, where we've reached a comfortable level for now in terms of our reductions to SG&A so that too.

Speaker Change #193: Severance payments should be going down.

Speaker Change #194: So if you look at our information for Q4, you can see the amount that the nonrecurring amount that helped us becoming positive, which obviously will not be there going forward, but we're still.

Speaker Change #194: Aiming to become net earnings positive over.

Speaker Change #194: Over the coming quarters.

Divya S. Goyal: And that's helpful. And last question, I wanted to get some little bit more color on Bernard and Claude, or Paul for that matter, the M&A that you have put in your strategic plan and expect that to be close to $150 million. Are there certain skill sets or proficiencies that you're looking to acquire?

Speaker Change #195: And that's helpful and last question that I wanted to get some little bit more color on.

Paul Raymond: And last question that I wanted to get some little bit more color on, we're not in thought either our fault for that matter. The MNA that you have put in your strategic plan and expect that to be close to 150 million. Are there certain skill sets or proficiency that you're looking to acquire, or is that an expansion across geographies? If you could provide some color on that, and that'll be all for me. Thank you.

Speaker Change #196: We're not employed either or for that matter. The M&A that you have put in your strategic plan and expect that to be close to $150 million are there certain skill sets or efficiencies that you are looking to acquire or is that an expansion across geographies.

Divya S. Goyal: Or is that an expansion across geographies? If you could provide some color on that, that would be all from me. Thank you.

Speaker Change #195: Provide some color on that and that'll be all for me. Thank you.

Claude Thibault: Next to you, maybe I'll start a quote, and I'll let you add on at the end. So definitely MNA. We did it ourselves a target over the next three years. And as you know, it's a we want a creative acquisition, so it'll, you know, we're looking for the right targets, and that will dictate kind of how we how we performing at that. But really, we look at the market, you know, where we are today in Canada, the US, and Western Europe. That is a big part of the IT spend globally. So our focus is never main where we are today in those markets with a focus on the US being the large. So those markets really, it's a space we want to we see the opportunity for growth when it comes to our service offering.

Bernard Dockrill: Thanks Divya, maybe I'll start with Claude and I'll let you add on at the end. So definitely M&A; we do give ourselves a target over the next three years. And as you know, we want a creative acquisition, so we're looking for the right targets, and that will dictate kind of how we perform against that. But really, as we look at the market where we are today in Canada, the U.S., and Western Europe, that is a big part of the IT spend globally. So our focus is going to remain where we are today in those markets, with the focus on the U.S. being the largest of those markets.

Speaker Change #195: Thanks, David maybe I'll start and I'll, let you add on at the end so definitely M&A, we do give ourselves a target over the next three years and.

David: And as you know.

David: We want accretive acquisitions. So it will we're looking for the right targets and that will dictate how we how we perform against that but really as we look at the market, where we are today in Canada. The U S and western Europe, but that is a big part of the IP spend globally. So our focus is going to remain.

David: Where we are today in those markets with a focus on the U S being the largest of those markets.

Bernard Dockrill: We see the opportunity for growth. When it comes to our service offering, it's really to extend where we are today. So we have a good play in ERP today, but there are other ERP packages out there that we would love to have those capabilities, so we can be a little broader there, especially in certain industries, which kind of leads to some of the other packages that we don't support today. And then the service offering, we want to, you know, we're looking at the whole strategy of a trusted advisor for our client.

David: That's a space we want to we see the opportunity for growth when it comes to our service offering it's really the extend where we are today. So there is you know.

Paul Raymond: It's really to extend where we are today. So there's, you know, we have a good play in New York today, but there are other ERP packages out there that we would love to have those capabilities so we can be a little broader there, especially in certain industries which kind of lead to some of the other packages that we don't support today. And then the service offering we want to, you know, we're looking at the whole strategy but trusted advisor for our client. So, when we do an ERP implementation or other things, we want to be able to support them in their other areas.

We have a good play in an ERP today, but.

David: But there's other there's other ERP packages out there that we'd love to have those capabilities. So we can be a little broader there, especially in certain industries, which kind of lead to some of the other packages that we don't support today.

Speaker Change #198: And then the service offering we want.

Speaker Change #198: We're looking at the whole strategy of a trusted adviser for our clients.

Bernard Dockrill: So when we do an ERP implementation or other things, we want to be able to support them in their other areas. So there are some gaps in our service offerings around those spaces, whether it's data and AI, or strengthening our cloud capabilities in certain areas. So we're looking for those services along in those geographies. Hopefully, that answers Claude. I'm not sure if you want to add something to that.

Speaker Change #198: So when we do an ERP implementation or other things, we want to be able to support them in their other areas. So there are some gaps in our service offerings around those spaces, whether it's data and AI.

Bernard Dockrill: No, that's very well put.

Claude Thibault: So, there's some gaps in our service offerings around those spaces, whether it's data and AI. Love to strengthen our cloud capabilities in certain areas. So, we're looking for those services along in those geographies. Hope that I just pulled on a shirt if you want to add something to that.

Speaker Change #198: Love to strengthen our cloud capabilities in certain areas.

Speaker Change #198: So we're looking for those services along in those geographies.

Speaker Change #199: That's just what I'm not sure if you want to add something to that.

Claude Thibault: No, that's the very, very well put.

Speaker Change #200: No that's very well put.

Unknown Executive: Thank you.

Speaker Change #200: Okay.

Speaker Change #201: Thank you.

Unknown Executive: And there are no further questions at this time.

Dave: Thank you Dave.

Operator: And there are no further questions at this time. I will turn the call back over to Bernard for closing remarks.

Dave: And there are no further questions at this time I will turn the call back over to Bernard for closing remarks.

Bernard Dockrill: I will turn the call back over to Bernard for closing remarks.

Bernard Dockrill: Well, thank you once again for your time this morning and your interest, and have a great day. Thank you.

Unknown Executive: Thank you once again for your time this morning and your interest, and have a great day. Thank you.

Bernard: Well. Thank you once again for your time this morning, and your interest and have a great day. Thank you.

Operator: Ladies and gentlemen, this concludes your conference call for today. We thank you for joining us, and you may now disconnect your lines. Thank you.

Unknown Executive: Ladies and gentlemen, this concludes your conference call for today. We thank you for joining, and you may now disconnect your lines. Thank you.

Ladies and gentlemen, this concludes your conference call for today, we thank you for joining and you may now disconnect your lines. Thank you.

Bernard: Okay.