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Good morning. My name is Jenny, and I will be your conference operator today. I would like to welcome everyone to the Insperity Third Quarter 2023 Earnings Conference Call. At this time, all participants are in a listen-only mode. [Operator Instructions] Please note this conference is being recorded. At this time, I would like to introduce today's speakers. Joining us are Paul Sarvadi, Chairman of the Board and Chief Executive Officer; and Douglas Sharp, Executive Vice President of Finance, Chief Financial Officer and Treasurer. At this time, I'd like to turn the call over to Douglas Sharp. Mr. Sharp, please go ahead.

Thank you. We appreciate you joining us. Let me begin by outlining our plan for this morning's call. First, I'm going to discuss the details behind our third quarter 2023 financial results. Paul will then comment on the quarter and our plan over the remainder of the year. I will return to provide our financial guidance for the fourth quarter and an update to the full year guidance. We will then end the call with a question-and-answer session. Now before I begin, I would like to remind you that Mr. Sarvadi or I -- they may make forward-looking statements during today's call, which are subject to risks, uncertainties and assumptions. In addition, some of our discussion may include non-GAAP financial measures. For a more detailed discussion of the risks and uncertainties that could cause actual results to differ materially from any forward-looking statements and reconciliations of non-GAAP financial measures, please see the company's public filings, including the Form 8-K filed today, which are available on our website. Now let's discuss our third quarter 2023 financial results in which we significantly exceeded our earnings expectations. Continued work on employee growth, combined with strong pricing, favorable direct cost trends and effective management of operating costs resulted in a 19% increase in Q3 adjusted EPS to $1.46 and an 18% increase in adjusted EBITDA to $94 million. As for our growth metric, the average number of paid worksite employees increased by 4% over Q3 of 2022, in spite of a continued slowdown in hiring by our client base in a more challenging sales environment. Client retention remains strong, averaging 99% for the quarter. At this point in the year, we are focused on our fall sales campaign, which generally convert to paid worksite employees in the first couple of months of the subsequent year. Paul will provide some comments on our recent sales activity in a few minutes. Moving to gross profit. We continued to exceed our pricing objectives and achieve favorable results in our workers' compensation program through the effective management of claims. As for our health care claims, you may recall that Q2's costs were negatively impacted both the number and severity of large health care claims and to a lesser extent, higher pharmacy costs. Accordingly, at that time, our earnings guidance over the second half of 2023 incorporated 2 scenarios. A lower earnings scenario generally assume the large claim activity continued at Q2's level for the remainder of the year, while the higher earnings scenario assumed a return to lower, more normalized activity. We are pleased to report that Q3 pharmacy costs came in at forecasted levels and the severity of large claims declined significantly. These factors contributed to favorable development of Q2's claim activity and our positive Q3 earnings. Now when we look at the full year 2023, we are now forecasting a full year benefit cost trend to be slightly below the low end of our previous estimate of 7% to 8.5%, this includes what we believe is a conservative Q4 forecasted cost trend that is generally consistent with our previous guidance despite the favorable Q3 health care cost results. Moving to operating expenses. We continue to invest in our sales, service and technology. Our growth investment included a 13% increase in the number of Business Performance Advisors which we believe puts us in a good position as we head into 2024. Our operating costs also reflected the impact of the inflationary environment on our costs and were partially offset by a lower incentive compensation accrual and a shift in the timing of the quarterly marketing spend when compared to the 2022 periods. Interest income earned on our investments and operating contingent -- operating cash continue to benefit from the current interest rate environment. And we believe that our financial position and liquidity remains strong as we continue to invest in our growth while providing returns to our shareholders. During the quarter, we took the opportunity to be more aggressive than our typical share repurchase activity. We repurchased 873,000 shares of stock during Q3 at a cost of $86 million and paid out $21 million in cash dividends. We ended Q3 with $190 million of adjusted cash and $370 million of debt. Now at this time, I'd like to turn the call over to Paul.

Thank you, Doug, and thank you all for joining our call. Today, I'd like to provide commentary on the following three topics: I'll begin with highlights behind our strong Q3 financial and operating performance. Secondly, I'll provide an update on the economic environment in the small to medium-sized business community which is the backdrop of our fall selling and retention campaign opportunity. I'll finish with some thoughts regarding the outlook for 2024 and beyond. This recent quarter was a welcome rebound in our financial results from Q2 with 4% unit growth, driving 5.5% gross profit growth and over 18% growth in adjusted EBITDA and EPS. We're pleased with these results considering some marketplace challenges continuing to deepen within the small to medium-sized business community, and I'll discuss this more in a few minutes. The most direct impact on our results from this environment is in net hiring within our client base, which reflected a continued slowdown we've seen throughout the year. For the first time in several years, client net hiring was flat this quarter. The net gain in our client base declined significantly when compared to Q3 2022. While client retention and the number of worksite employees paid from new client sales remained consistent compared to the same period last year. In addition to the lower large health claim cost, Doug mentioned, our pricing and cost management were the strong drivers of our outperformance. This reflects solid execution across the company and contributed to a strong quarter and our outlook for the long term. Another highlight was our increased service capacity and client satisfaction levels as utilization of many of our HR services increased. Our hiring and training results over the last year have improved our service efficiency ratios to handle growth and resulted in a notable increase in our Net Promoter Scores. During the third quarter, we completed the implementation of our Salesforce CRM system across our service organization. We now have the entire company on a common platform that provides the opportunity for more timely, precise and efficient client service interaction and potentially greater client satisfaction. We can see in our service utilization metrics, the changing needs of clients in the current environment. Many HR services that are used more in a slower growth environment increased significantly over last year. This included support for worksite employee terminations such as separation agreements and support for employment practices and unemployment-related claims. These services have been at historically low levels in the past couple of years, so this increase is expected in a more neutral hiring environment and further demonstrates our ability to bring value to clients in any economic environment. Booked sales for the third quarter were mixed with strong performance in Workforce Acceleration, our traditional employment service offering, while our Workforce Optimization core mid-market book sales were below our expectations. Our Workforce Acceleration book sales reflect adoption of this offering across the sales organization and has helped our newest BPAs experienced earlier success. This has led to lower turnover rates, which has excellent potential to drive sales efficiency going forward. Now in early September, we had a successful national kick off to our fall selling and retention campaign and increased marketing efforts to continue to drive sales activity levels. Our discovery call activity was a strong point in Q3, up double-digits, which we expect to be a solid indicator for Q4 sales. Now I'd like to provide some data points and survey results from our client base, reflecting decisions and sentiments in the small- and medium-sized business community that we see across the country. This provides a picture of how we believe the challenging economic climate related to interest rates, inflation in the labor market are affecting many of these businesses. I mentioned net hiring within the client base was flat this past quarter and additional underlying data is consistent with this metric. Lower pay increases, overtime pay and commissions paid to the sales staff of our clients, all reflect some economic pressure. Average pay increases dropped to a low point of approximately 3% for the first time in several years. Overtime pay was below the 10% level, which historically aligns with the lower need to hire personnel. Commissions we pay on behalf of our clients to their salespeople, which provides some insight into the pipeline for new business in the client base, was well below the 6% level, which typically indicates employment growth. Now our quarterly survey of the client base, which provides insight into the client sentiment, included a ranking of top 4 concerns for their organization. The top 4, we're managing operating costs, driving sales, external economic uncertainty and the labor market, especially the quality of the applicants. We also asked survey participants their top HR concerns. The top 3 concerns all cited by over 50% of those surveyed were; retaining employees, keeping employee engagement high and building or maintaining a strong culture, right behind those 3 was managing health care costs. Now throughout our history, this type of challenging backdrop translates into quite an opportunity for Insperity. These needs for consultative HR services, increased demand for our comprehensive HR service solutions and highlight our competitive advantage. Historically, we've seen competition become somewhat desperate for sales growth when net hiring within the client base falls this low, and we've seen some of that over the last quarter. As the premium service provider in the marketplace, we are well able to compete on short-term promotional tactics from competitors but they cannot match the breadth and depth of our services and the level of care we provide our clients and worksite employees at their greatest time of need. Over the first 2 weeks of this quarter, our sales leadership did a deep dive, evaluating Q3 Workforce Optimization sales drivers, including input from BPAs and potential clients. This provided sufficient information to take specific action, which led to an immediate boost to fall campaign sales and retention efforts. This boost came in the form of a dramatic increase in sales activity, including both closing business and new opportunities to quote potential clients. Attitudes and energy levels across the company also benefited, reflecting the Insperity culture of rising to the occasion to take advantage of a specific opportunity. So we believe we're well positioned for a successful fall selling and retention campaign, which is important to achieve a starting point in paid worksite employees to start the new year. As we look ahead to 2024 and beyond, we continue to be excited about the vast market opportunity and strong demand for our services in the marketplace. We're also in a strong position in staffing levels in both sales and service to capitalize on this opportunity. For next year, it's too early to provide any specific guidance, but there are general considerations for growth and profitability to weigh in mind. Historically, our lead indicator for future growth has been the growth rate in business performance advisers, combined with expected sales efficiency gains based upon their tenure. As Doug mentioned, our continuing investment into BPA growth was a highlight this quarter coming in at 13%. So over the next year, we believe we're in excellent position for new client sales. Client retention has been solid all year, and our focus on this measure across the company provides confidence into next year on this key growth driver. The other growth factor to consider is the economic climate ahead and the effect on net hiring in the client base. Historically, in an average year, we expect a client net hiring contribution of 4% to 6% in our growth rate of worksite employees. This year, the contribution to our growth from net hiring was below the low end of that range. Although we believe net hiring will eventually revert to historical levels, a number of factors are posing obstacles that may make this more gradual. In addition to the interest rates, inflation and the labor market effect we've seen recently, 2024 is an election year that historically adds some uncertainty. Now based upon these growth factors and assuming a successful year-end transition, I see next year similar to this year's full year growth rate of mid-single digits, but the opposite on timing instead of higher single-digits early in the year and lower single-digits towards the end like this year, I see lower single-digits early and high single-digits towards the end of the year on our way back to our historical target of double-digit unit growth. Now beyond unit growth, the most important factors in our outlook for profitability are trends in our pricing, direct cost and operating expenses. Our pricing strength continued this quarter with the recovery in direct cost, we believe we are in a strong position to achieve pricing and direct cost alignment targets going forward. Our operating expenses have included some significant investments over the last couple of years, including BPA growth and sales incentive plans, increasing service capacity and implementing Salesforce CRM. Although we continue to expect investments going forward, we believe the historical operating leverage of our business model will begin to reemerge. So as I look ahead to next year and beyond, I expect the level of growth and profitability to ultimately return to historical levels. Our historical business model performance includes 5-year periods with double-digit compound annual growth rates of 10% to 12% in worksite employees, driving mid-teens growth rates in gross profit and rates above 20% in adjusted EBITDA and EPS. Now we have had historical 5-year periods. That included a year like this year where we absorbed a growth challenge from client net hiring and/or a profitability challenge from a direct cost aberration. We are in the second year of our current 5-year plan, and our eyes remain on the objectives similar to historical levels. There are 2 reasons for my level of confidence; the clients we serve and the dedicated team of people we have at Insperity. Our position in the marketplace as a premium provider to the best small- to medium-sized businesses in the country has allowed us to observe the resiliency and innovation that are key to addressing economic challenges and creating market opportunities. In addition, our corporate team has demonstrated the capability to achieve extraordinary results and they are focused on the appropriate strategies and objectives that provide consistent value to our clients and help their businesses succeed. At this point, I'd like to pass the call back to Doug.

Thanks, Paul. Now let me provide our updated guidance, which includes an improvement in our Q4 forecast over our previous expectations in the areas of gross profit and operating expense management, partially offset by slightly lower paid worksite employees. As for the details, we are now forecasting 6% worksite employee growth for the full year 2023. The slightly lower growth outlook from our previous expectations as a result of Q3's average paid worksite employees coming in at the low range of our prior guidance. Additionally, we are expecting net hiring by our client base to continue declining through Q4. We have revised our earnings guidance based upon our year-to-date results, including the strong Q3 earnings and our updated Q4 outlook, which includes the expectation of an improvement in profitability from pricing, direct cost programs and operating expense management to more than offset the slightly lower paid worksite employee expectations. We are now forecasting full year 2023 adjusted EBITDA in a range of $340 million to $360 million and adjusted EPS in the range of $5.20 to $5.60. As Paul mentioned a few moments ago, our efforts are now focused on our sales campaign and heavy client renewal period, which are important to our starting point for paid worksite employees in 2024. We look forward to updating you on these results in our next earnings call, and we'll provide our 2024 guidance at that time. Now at this time, I'd like to open up the call for questions.

Thank you very much. [Operator Instructions] Your first question is coming from Andrew Nicholas of William Blair. Andrew, your line is live.

Thank you and good morning, Doug and Paul. I wanted to first ask on the sales environment. I think, Doug, you mentioned a more challenging sales environment, Paul, I think you mentioned that and also the competitors are being a bit more aggressive. Can you just flesh that out a little bit? How are you seeing that kind of play out day to day? And also how willing are you to react to maybe more aggressive pricing from competitors to maintain clients versus win clients and maybe how that decision process changes depending on whether it's retaining or adding a new one.

Sure, happy to address that. In our industry, we always have a level of competition. We always have a decent percentage of greenfield as well. But in the competitive environment, it ebbs and flows, and it is typical when the net gain from the client hiring in the base kind of goes down. It's kind of like a -- when the rate goes down, the stumps show up. And so what happens is you do have kind of an increase in the competitive environment when that focus becomes on your net gain from your new sales against your client attrition. So it does increase some, and that was consistent with what we've seen over the course of the year. And for some, they get pretty desperate and we'll look at price differently. Now we are, of course, the premium service provider in the space, and we provide a level of comprehensive services that support clients in any economic environment, and especially it's important when there's a changing economic environment or some added pressures in the environment. So it puts us in a position to be able to really accentuate the difference that we have and the breadth and depth of our services and the level of care. But we also don't just ignore the pricing sensitivity in the marketplace. And it's part of our corporate culture to jump in and help customers when they're going through difficult times. So this doesn't really bother us when that happens. But we are responsive. We use a targeted approach because, as you know, in any economic environment, some companies are doing better than they do in other periods. So it's never an across the board solution. We look at it more in terms of targeting and making sure that we're competing effectively. So frankly, it motivates us in a different way. We evaluated that third quarter environment, and we were able to make some very specific strategic competitive choices that we're really excited about how that's already added a boost to our fall campaign efforts.

And then for my follow-up, I just wanted to double back to benefit costs. It sounds like pharma was largely in line with what you had expected. But I think, correct me if I'm wrong, still relatively elevated. Is the expectation that, that kind of remains elevated, particularly with some of the diabetes drugs out there and GLP-1. Just kind of how you're thinking about pharma costs more specifically looking ahead to '24 because it sounds like the larger claims activity on the other side has died down some.

I think overall, the use of these specialty drugs continues as we've all seen out there in the marketplace. And so we don't expect a sudden drop of the utilization of those drugs. So therefore, yes, we're considering that trend to stay at similar levels as we've recently experienced. I think you also have to take into account the pricing side of things and that we've been able to exceed our pricing targets. And obviously, we're putting in pricing targets to take care of this new pharmacy trend. So overall, as we go through renewing existing accounts, selling new accounts, we feel like we've got the appropriate matching between price and costs relative to this new pharmacy trend phenomenon.

I would also say that, that pharmacy trend is more likely to moderate from next year because it's a year into this increase of activity in these particular drugs and once you get that year under the belt, you don't expect it to increase the same amount as last time. So according to the input we're getting from those that consult with us on this, we think we've really aligned our pricing well with cost trends.

Your next question is coming from Mark Marcon of Baird. Mark, your line is live.

Good morning and nice to see the rebound with regards to the gross profit here in the third quarter. Paul and Doug, I was wondering if you could do an even deeper dive with regards to the cost trends that you're seeing on the health care side, how you're anticipating that unfolding for next year? And how are you thinking about the price increase and also on a base level apples for apples and also how you're thinking about it in terms of any sort of planned design changes, what would be the net impact? And I'm particularly curious just because we've heard some commentary from some of the other players that have talked about higher health care costs and lower utilization rates among their clients and among the employees. So I'm trying to think through like how in your vast experience, this would end up spilling through to utilization as well as ability to win clients, particularly if some of the other competitors are being a little bit more price competitive.

So let me try to address that as a broad -- a wide question. And it does -- it is something we spend, of course, a lot of time and effort on, on an ongoing basis, literally in the depth of every driver to these costs. And you do have to look -- I'm glad your question includes both the cost and the pricing side because that's really the nature of our business is to make sure that we align the pricing with what costs are expected to be. And the other specific thing to us is we're coming off of a year with somewhat of an unusual or period of large, both severity and frequency of large claims. You got to weigh all that in. But the main message that you should take away today is that with that receiving -- in fact, I mentioned this last quarter that if, in fact, those severe claims continued through the year that we were likely to not quite be in alignment into next year and it might take to midyear or so for that to take place. We're not in that situation. We had -- you can see from the rebound, even though we have forecasted in conservatively, we are confident today, as I said in my remarks, that alignment on the pricing side with these cost trends, we feel good about. So to the degree that we've had some dampening effect to gross profit this year from benefits, we don't see that into next year. However, that's only one component of the whole direct cost picture. And so we're not at a point of being that specific about next year. But in terms of the big picture, our comfort on the gross profit level is better than what we went through this year and we'll be digging in on details on price and cost and all of our components as we plan into next year, and we'll be providing specifics, of course, on our next call for guidance.

I think another thing you're probably aware of is the inflationary environment, is there contract -- carrier contract negotiations and pharmacy negotiations. That's just where we are today in the current environment that we're working in. And obviously, we're going to be considering that in our pricing.

Can you talk a little bit about what you're seeing just from a geographic perspective in terms of the net hiring impacts and I'm specifically curious one of your competitors mentioned that particularly in California with tech and professional services, there was a bit of a slowdown with regards to hiring. Wondering if you're seeing the same thing? And along those lines, I'm wondering if you can also just talk about the increased penetration of the PEO concept and your success in terms of newer, less well-developed markets and what you're seeing and how that for bodes for the long-term future.

We really did do some digging down on both the industry and geographic elements related to -- and drivers of the flattening of the net change within existing clients. And certainly, we saw areas where the professional and technical is a bigger part of the environment in a given location, we saw that contribute more to this flattening. And that was, of course, both the West Coast and the Northeast. So we saw those 2 regions where we saw the most effect there by in terms of geography. Now in terms of industry category, absolutely professional, technical, was right there. But also, we did see this broaden more over the last quarter or so. And so I think some of the effect that I described in here, the effective interest rates and inflation and the labor market especially the quality of available people in terms of matching the requirements. Those things are having an effect. We saw that in a deeper analysis of the net pay change. That's gone down now back to even below some of the average levels of 3% to 4% for average pay increases dropped down a bit. You have those other 2 factors I watch closely, overtime pay as a percent of regular pay, being down below 10%. And then the other that is a really key factor is that commission number. We're paying these commissions to the sales staff of the clients. That means they're getting paid based on the sales they've made recently. That's the pipeline for new business at the client location. That's down pretty significantly especially compared to recent periods, booming periods post-COVID, those numbers were really high. They were -- they've been decreasing and now gone below that 6% level that we have seen historically as a trigger point above 6%, they would need to hire more people below that, they're able to hold fast. So that is reflective. And like I said previously, in answer to another question, that doesn't mean all the small business community is having that reaction. It's always a mixed bag, but much of the community is really having to deal with a tougher economic environment. And fortunately, we're in a business where the demand for what we do is heightened anytime there's changing going on or pressure going on, they need help. So we are excited about the demand for our services. And you do have to change some of your -- some of your messaging to fit more tightly or you have to understand a specific client's current situation to understand what part of our messaging would connect more to their current going forward plan and how we can connect to helping them in the immediate future. And so it becomes a little more I wouldn't say complex, but there's more thinking you do to really connect with each customer. So -- but that's a good environment for us. We've seen this before, and it's -- it really gets us excited. We're in a business that's designed to help businesses succeed so communities prosper and they need help in a time like this, and we're excited to be right shoulder to shoulder with them.

Your next question is coming from Tobey Sommer of Truist Securities. Tobey, your line is live.

Thank you, Paul and Doug. I wanted to ask a question about your sort of expense and investment posture headed into next year. So not really the inputs to gross profit, but sort of how you're going to prosecute sales, the investments in the sales force, marketing, the things that you can sort of more directly control. How are you thinking about that at this stage because I know you're afforded the opportunity and have planned for longer time horizons than I think your average public company.

Yes, absolutely. We're in good shape going into next year on the operating expense side. And in the area that you're describing or asking a question about on the sales side, since we have 13% increase in the size of the staff, our investment in that doesn't have to be as high as it was over the last year. Also, the last 2 years, we've invested more in the incentive system, which now is built into the base of our operations. So I don't see us having to make an additional investment in that area of the business. So we are able then to do the smart thing, which is make sure our investment is appropriate in the marketing area to provide the activity level needed for our sales team because as they are now another year into their training and development there, sales efficiency number can go up as long as you're feeding them a good volume of activity. So I love the position we're in, going into next year. And then in addition to that, as I mentioned in my remarks, we had to go through a significant recovery or catch up on the service personnel across the company. Again, from the tight labor market and the fast growth. So this year has been a great opportunity to rightsize the staff, be prepared -- better prepared for a level of growth but that was also a big investment that I don't see repeating. We can actually increase staff more in alignment with growth as opposed to what we had over the last year. And also, of course, the Salesforce investment was a significant one. Like I said in my remarks, it's not like we're not going to make other investments but not at that level. So I do see a recovery in the operating leverage on that side of the business as we move forward.

If I could ask a follow-up. How are you feeling about pricing and competition, particularly, I think the health care benefit costs are expected to rise next year in the market, sort of rate of growth. And I'm curious in the fall selling campaign how you're feeling about pricing in competition in the next year?

Yes, I feel real strong about how we are handling the matching of our allocations going forward, we've discussed that. So in terms of the competitive environment, this is a fun time of year for us. I love how we are focused on dealing with these things in the marketplace. And I'm not going to go into detail about that. I just know we've got a great plan on that front, and it's focused, it's targeted and it's not an approach that affects our long-term pricing. It's an approach that affects allowing clients to come on board and almost more of a try and buy approach that is very effective against what we're seeing in the marketplace. So again, we are more concerned about long-term matching. And I think because we've been strong in our pricing up to this point, there may be others in the marketplace that have to respond more quickly, say, on the health care side we've been managing that. I think they're effectively in a big objective of ours in that area is a more stable environment for the customer base. That's why just this year is an example where we took a hit because of the volatility and the timing, but we keep a steady view of how this should happen over time, and our customers get the benefit of that. So it's another benefit of how we do this as a premium service provider that is something we can point to in the dynamic you're referring to. So good confidence on that front as well.

Thank you very much. Your next question is coming from Jeff Martin of ROTH MKM. Jeff, your line is live.

Paul, I wanted to see if you could expand on the efforts of the fall campaign strategy. It sounds like you've made some pretty strategic pivots there. Sounds like it's a combination of client retention as well as going after new clients. And is that more of a shift relative to Workforce Acceleration sales trends that you've seen versus Workforce Optimization? Or are there other things going on there?

No, it's actually kind of across the board in terms of -- I mentioned the efforts on the marketing side of the business, driving lead flow. We've also -- I would say that maybe the best way to understand it is that there's 3 elements to driving sales success in a campaign. It's the activity, it's the attitudes in the incentives. And we have that triple braided cord in a really strong position as we go forward to the balance of the year. And yes, it is directed at both our campaign is both the sales and retention campaign. And so I think the level of alertness across the company, the level of focus and the level of enthusiasm gives us a good feeling about the campaign. And it's important to have that level of all those things. When you have an environment that's a little tougher. And I think what I've laid out today is what we're seeing in the current client base and in the sentiments from the survey information what we're seeing across the country, what we're seeing by industry, that means that in a period like this, you've got to be on the top of your game. And that's what we'll be continuing to emphasize across our employee base. And we'll give it our very best shot, and I like that kind of selling and retention season that we have ahead of us.

For my follow-up, it's a 2-part question. First part is, could you discuss BPA retention trends year-to-date and then hiring plans for next year? And then second part is, could you touch on the middle market and sales and retention trends you've seen there?

Yes, absolutely. We really have had an excellent year on that front and the Workforce Acceleration strategy has played in well to reducing the turnover rate, we think that's significant. Our turnover rate this year is significantly down from last year, and that is -- that includes that we had a significant number to promote from the BPA roll into a sales management role. So even with all of that weighed in there, we're in a really strong position. I see that for next year, we can probably grow the BPA staff even below our 8% or 9% target, maybe a little -- maybe the low end of our range because we have such a high number that are in that ramp-up in their sales efficiency mode. So feel good about that and how we can manage that going into next year. What was that second half of your question?

It was on middle market, sales and retention trends.

Yes, absolutely. So middle market continues to develop. It is a smaller team, but we have been adding strategically there. That will probably continue to add normally, but it's nominal in terms of the numbers on the investment side. But our connection between our core market and mid-market teams and the ongoing flow continues to improve and be strong, which requires us to grow that team in addition. So that will be going out throughout next year.

That appears to be the end of our question-and-answer session as there are no more questions in the queue. I will now hand back over to Paul Sarvadi for any closing remarks.

So once again, we'd like to thank you for your participation today. We're looking forward to this fall selling and retention campaign and achieving a decent starting point for next year. And on the next call, we will have all that baked into a going-forward scenario for 2024, and we look forward to sharing that with you at that time. Thank you again.