Whitney Kukulka - The Blueshirt Group, IR Paul Johnston - CEO Rich Schlenker - EVP and CFO.

Joseph Foresi - Cantor Fitzgerald Tim McHugh - William Blair Tobey Sommer - SunTrust Marc Riddick - Sidoti.

Exponent’s First Quarter of Fiscal 2017 Financial Results Conference Call. As a remainder, today’s conference is being recorded. At this time, I would like to turn the conference over to Whitney Kukulka. Please go ahead..

Thank you, operator. Good afternoon, ladies and gentlemen. Thank you for joining us on Exponent’s first quarter 2017 financial results conference call. Please note that this call will be simultaneously webcast on the Investor Relations section of the Company’s corporate website at www.exponent.com/investors.

This conference call is a property of Exponent and any taping or other reproduction is expressly prohibited without prior written consent. Joining me on the call today are Paul Johnston, Chief Executive Officer, and Rich Schlenker, Executive Vice President and Chief Financial Officer.

Before we start, I would like to remind you that the following discussion contains forward-looking statements including but not limited to Exponent’s market opportunities and future financial results that involve risks and uncertainties that may cause actual results to differ materially from those discussed here.

Additional information that could cause actual results to differ from forward-looking statements can be found in Exponent’s periodic SEC filings, including those factors discussed under the caption factors affecting operating results and market price stock in Exponent’s most recent Form 10-K.

The forward-looking statements and risks in this conference call are based on current expectations as of today, and Exponent assumes no obligation to update or revise them, whether as a result of new developments or otherwise. And now, I will turn the call over to Paul Johnston, Chief Executive Officer.

Paul?.

Thank you, Whitney. Thank you for joining us today for our discussion of Exponent’s first quarter 2017 financial results. Exponent’s first quarter results were better than our prior outlook and benefitted from continued growth in our human factors construction consulting and polymer science practices.

With continued softness in a few industry sectors and a difficult year-over-year comparison, we are pleased to have delivered growth in the first quarter. Net revenues were $80.5 million, a 2% increase as compared to the $78.9 million for the same period last year.

Net income was $16.6 million or $0.61 per diluted share in the first quarter of 2017 compared to $15.4 million or $0.556 per diluted share in the same period last year.

This net income is inclusive of a $6 million or $0.22 per share tax benefit realized in the first quarter compared to a $4.5 million or $0.16 per share tax benefit realized in the same period last year.

Our engineering and other scientific segments which represented approximately 79% of the Company’s first quarter net revenues, grew 4% year-over-year. In the first quarter, we performed a large project for our client in the consumer products industry that contributed to the strength of our human factors practice.

This project represented approximately 5% of our net revenues in the first quarter and we anticipate a contribution of approximately 3% to 4% of net revenues in the second quarter. For purposes of context, we had a similar project of approximately half the size in the first quarter of 2016.

We expect to return to a more normal project portfolio in the second half of the year and are therefore reiterating our expectations of modest topline growth for fiscal year 2017. We believe that we are well-positioned to capitalize on our clients’ needs to better understand what happens if people intersect with complex products and processes.

We have assembled a unique human factors team which includes staff with PhD level degrees in a variety of disciplines, including experimental psychology, cognitive neuroscience, industrials and systems engineering and kinesiology.

We continue to expand our international construction disputes work with current mining, gas terminal and power plant projects. We also saw increased demand from the medical device industry for our multidisciplinary team of material scientists and mechanical engineers to support product development and litigation matters.

Our environmental and health segment which represented approximately 21% of the Company’s first quarter net revenues, declined 5% year-over-year. Exponent’s food and chemicals practice expanded as it assisted clients with regulatory issues around the world.

Lower revenues from oil and gas and the industrial chemicals industries have created a challenging year-over-year comparison for this segment. While our results continue to be impacted by softness in a few industry sectors, we’re confident in the strength and long-term financial health of the company.

This year we’re proud to celebrate Exponent’s 50th anniversary, a testament to the strength of our multidisciplinary team and the resiliency of our business model. We held our biannual managers meeting March 31st and April 1st, where we gathered for two highly productive days to plan for the future and focus on improving our growth.

In the first quarter, we paid $5.4 million in dividends, repurchased $1.3 million in common stock and ended the quarter with $154.9 million in cash equivalents. Today, we announced another quarterly dividend payment of $0.21 per share and reiterated our intent to continue to pay dividends going forward.

We believe that our long-term value proposition along with our regular quarterly dividend payments and stock repurchase program demonstrates our continued commitment to deliver shareholder value. Now, I’ll turn the call over to Rich for a detailed review of our financial performance and business outlook..

Thanks, Paul. For the first quarter of 2017, revenues before reimbursements or net revenues as I will refer to them from here on, were $80.5 million, up 2% from $79 million in the first quarter of 2016. Total revenues for the first quarter were $84.1 million, up 1% from $83.2 million a year ago.

Our revenues continued to be impacted by softness in a few industry sectors but benefited from the large project that Paul previously mentioned. Net income was $16.6 million or $0.61 per diluted share in the first quarter of 2017 as compared to $15.4 million or $0.56 per diluted share in the same period last year.

In the first quarter of 2016, Exponent early adopted a new accounting standard for the classification of tax adjustments associated with share-based awards. The tax benefit realized in the first quarter of 2017 was $6 million or $0.22 per diluted share as compared to $4.5 million or $0.16 per share in the first quarter of 2016.

For comparison purposes excluding the tax benefit, net income declined 3% to $10.6 million. EBITDA for the first quarter was $18.7 million down 1% from 2016. For the first quarter, billable hours were 296,000, a slight increase as compared to the same period last year.

Our utilization was 74.2% in the first quarter, up from 74.0% in the same period last year and better than our previous expectations.

The utilization benefited from the major project engagement and international construction consulting, this was partially offset by the New Year holiday which was a first quarter event this year and the managers’ meeting that Paul discussed.

While we expect utilization in the second quarter to be better than the same period last year, it will be down as compared to the first quarter of 2017 by approximately 2 percentage points as the activity on the large human factors project will continue but at a lower level.

For the full year 2017, we continue to expect utilization to be flat to slightly up as compared to the 70% achieved in the full year 2016. Technical full time equivalent employees in the first quarter were 767, up 2% from yearend but was approximately even with the first quarter of 2016.

With the strong first quarter headcount growth, we would expect that piece to remain at the same level in the second quarter and then grow approximately 1% per quarter in the second half of the year.

In the first quarter, the realized bill rate increase was approximately 2.5% but was partially offset by 0.6% from translating foreign currency for consolidated financial statements. For the remainder of 2017, we expect to realize a rate increase of 2% to 2.5% and the impact of FX to be approximately 0.3% based on current rates.

EBITDA margin for the quarter was 23.3% of net revenues, down from 24.1% in the same period last year. For the first quarter, compensation expense after adjusting for gains and losses and deferred compensation increased 2%.

Included in total compensation expense is a gain in deferred compensation of $1.9 million as compared to a gain of $430,000 in the same quarter one year ago. As a remainder, gains and losses in deferred compensation are offset in miscellaneous income and have no impact on the bottom line. 2017, salary increases were effective April 1.

The rises in salaries will be similar to the rise in bill rates. Stock-based compensation expense was $5.7 million in the first quarter as compared to $5.2 million in 2016. For the remainder of 2017, we expect stock-based compensation to be approximately $2.7 million to $3 million per quarter.

Other operating expenses increased 3% to $7.2 million in the first quarter. Included in other operating expenses is depreciation expense of $1.6 million. For the remainder of 2017, we expect other operating expenses to be approximately $7.4 million to $7.6 million per quarter.

G&A expenses were $4.2 million in the first quarter, up 20% from $3.5 million last year due primarily to our managers’ meeting and marketing materials which leverage our 50th anniversary. Half of these expenses were realized in the first quarter and the remainder will be expensed in the second quarter.

As such, we expect the second quarter G&A expenses to be $4.8 million to $5 million and for the second half of the year, G&A expenses are expected to be $4 million to $4.4 million per quarter. As I previously mentioned, we realized a tax benefit of $6 million in the first quarter. The tax benefit is primarily a first quarter event for Exponent.

As a reminder, RSUs from our annual compensation program are granted in March of each year and are issued four years later. The tax deduction for the gains realized upon issuance generated the tax benefit. Our first quarter tax rate was 4.8%, which was reduced significantly by the adoption of the new accounting standard we implemented one year ago.

For comparison purposes, exclusive of the tax benefit, our tax rate would have been 39.4% in the first quarter. We expect a tax rate of approximately 39% during the remainder of 2017. For the first quarter, operating cash flow were a negative $1.8 million, as a result of paying bonuses, dividends and taxes in the quarter.

DSOs did increase but we believe this will be temporary. Capital expenditures were $1.3 million. We repurchased $1.3 million of common stock for a total of 23,000 shares at an average price of $57.63 during the first quarter. We still have approximately $56 million authorized and available for repurchases under our current repurchase program.

Additionally, we distributed $5.4 million to shareholders through dividend payments and today announced another quarterly dividend payment of $0.21 for the second quarter of 2017. After repurchases, dividends and annual bonuses, we ended the quarter with a $155 million of cash and short-term investments.

While our first quarter results were better than expected, we continue to expect modest top line growth due to the adjustments in headcounts during the second half of 2016 and markets in a few industry sectors.

As we previously discussed, we expect 2017 revenues before reimbursements to grow in the low to mid single digits and EBITDA margin to decline by approximately 25 to 75 basis-point as compared to 2017. I will now turn the call back to Paul for closing remarks..

Thank you, Rich. Exponent continues to be retained by a diversified portfolio of marquee clients for engagements spanning a wide range of industry sectors. Our unique multi-disciplinary team provides solutions to improve the reliability and safety of technologically complex products and processes.

We are optimistic about our opportunity to leverage our unique market position on a more global basis and are confident in our ability to generate long-term growth.

While our 2017 growth will be modest, our value proposition remains strong and our long-term financial goals remain the same, to produce organic revenue growth, improve profitability and maintain a solid balance sheet. Operator, we are now ready for questions..

Yes, thank you. [Operator Instruction] And we will take our first question from Joseph Foresi with Cantor Fitzgerald..

Hi. A couple on the large consumer engagement.

Did that large engagement cost of 5% mark this quarter? How is your visibility on the wind down? And is it coming at a higher margin?.

So, Joe, it was right around 5% for the quarter. And I think you know that in the past, we have indicated when projects are more than in the sort of to 2% to 3% range which is normally are the size of a typical large project, when they get to 4% or 5%, we have indicated we would let the investor community know.

And so, this was right around 5%, and so we wanted to alert everybody to that. We do have some visibility with regard to the second quarter for this and that’s why we have indicated that we think that it will be a of the order of 3% to 4% of our revenues in the second quarter.

We don’t have any visibility beyond that and we think it’s reasonably likely that it could end, although it’s possible it could continue. The one thing I would just say about this, this is a proactive engagement; it’s not a litigation based engagement. And as such, it’s working that vein.

So, it’s not something that we anticipate will extend for a very long time..

Got you. And maybe you could just give us an update on some of the weaker areas. I think it was oil, gas, IP and automotive.

What’s the size of those businesses at this point and have you seen any change in demand there?.

Well, first of all, in the oil and gas area, the core part of that, we did see some growth in that and it was only related to the fact that we had one of our international construction consulting jobs that was in the oil and gas industry.

We had mentioned before that we were seeing that our business in oil and gas was approximately 5% of our business, that is closer to -- it’s in the 6% to 7% range because one of these projects is -- sort of couple of the projects are in that range; they have brought that up to the -- about 7% level.

But, it hasn’t really been a change in overall demand from that industry because this is a disputes related project; it’s a project that the client had obviously going for years before we got involved.

And as such, it’s not an indication of any real change in our -- and what we are seeing in the market for -- in demand for our services in oil and gas. As far as the automotive industry, that remains around 9% to 10% of our business. It has been flat on a year-over-year basis.

And at least at this point in time, there is some pretty exciting things going on in the broader automotive industry around enormous vehicles and such and electric vehicles that we are getting engaged on. But at this point in time, it has not led to a significant change in that business or growth in that business for us yet. Go ahead, John..

I’m sorry, Rich. Go ahead. You were going to finish..

The other industry that we’ve commented on before is really in the broader chemicals area, which again, we haven’t seen really a change in that environment yet. I think number of the larger mergers that are going on appear to be progressing through the regulatory approval process.

And as they go through that needs, organizations begin to go through their integration, we would expect to be able to get a better read on how work that we might interact -- that we provide services and will flow through those new organizations..

Okay. And then the last one for me was just on the guidance front. I understand sort of being a little bit more conservative, given the fact that you have this large project out there. But I guess on the margin side, it’s fairly decent margin this quarter, I think you got good visibility on what the headcount’s going to be like.

You’ve been able to kind of squeak out more utilization as years have gone on in the past. I guess I’m wondering, are you being conservative on the margin front as far as guidance is concerned? Do you expect to be at the upper end of that range? Maybe any color around that would be helpful. Thanks..

As far as the margins go, I mean, we -- our margins were still down here in the first quarter about 77 basis points, so at the sort of low end of that range on our 25 to 75 basis points. We still expect our utilization to be flat to slightly up for the year; that hasn’t changed much.

I mean this was just one quarter of utilization being a little bit better than we had expected. We don’t at this time believe that that’s going to push us out of the range that we were expecting coming into the quarter. And as such, we aren’t looking -- expecting to the change that range at this time..

And we’ll now go to Tim McHugh with William Blair..

Thanks.

Just can you -- I know you can’t say the customer but can you tell us a little bit more about the big projects? I think it’s easy for us to often picture the legislative stuff but when you say human factors analysis, I guess what more anyway you can help us picture that a little more finely, I guess in terms of the analysis?.

Tim, let me describe the broad area that we operate in on these kinds of studies.

They range from, everything from sort of kids’ interaction with toys and appliances and washing machines and things of sort of one end of the scale all the way through to issues with regard to sort of health orientated type things at the other end of the scale, interacting with various technology and so forth. It’s a very broad range of things.

Unfortunately, the thing that is most confidential in our business are large proactive projects, because it’s not just the client that is confidential but the type of work we’re doing for the client is extremely confidential, because these obviously relate to potential new products.

And so from that stand point, Tim, I’m sorry but I really can’t describe more..

Okay.

Now, did you make the comment -- you were doing some work on the same project a year ago, just half as big and it got bigger this quarter, is that right?.

It wasn’t the same project, I just said we had a similar kind of projects last year; that was about half a size. What I really want to a sort of explain in that in a sense is we do get these projects from time to time, this particular one being of the 5% revenue was one that we thought we needed to flag.

We have told you that we will do that when we get something up in the 5% kind of range. But we have had a number of these projects in the past that would be less than that from I would say 2% to 3%, down to 1%, down to much smaller projects.

And so, it wasn’t that we haven’t -- I didn’t want to you feel like we had a 5% project in this quarter in an area that we never had a project even similar to it before; that’s not the case..

Okay..

We have these projects quite frequently but this one just happened to be a lot bigger..

And when you had guided, I guess the last time we talked, did you know that this was going to be this big or did it surprise you I guess?.

So, we knew we had the project, we didn’t know it was going to be this size..

Okay.

And Rich, just one numbers question I guess is the headcount was the 767 at the quarter end or the average?.

That was the average for the quarter. We ended right about that number might have been -- I think we were seven -- we are probably down by one from that. So, I think we average 767, I think we are 766 at quarter end..

Okay. And then, I guess, one bigger I guess question, just thinking I guess on the engineering segment which I understand the headwinds to environmental, you have been kind of have been battling but.

If you have this big project in there and you tell us kind of also construction dispute was going well, I guess the 4% growth for that segment is still a fair amount less; it’s less than the kind of the high single digit growth you normally target.

So, what -- are there other factors that we haven’t talked about? Is it just -- I guess why wouldn’t with those tailwinds -- wouldn’t that piece of the business be back up to where you normally I guess have seen growth in the past?.

Yes. Tim, I think there is a couple of things going on, I think one is where we are in headcounts. We are not in a position where we are lapping headcount at the rate of growth that we would expect in normal environment.

We have been in this situation as you recall that second quarter last year was very poor for us; as a result, we had actually a falling headcounts as we rolled out the rest of last year. We ended I think lower than our peak.

And so, now, we are turning that around and we are coming back, but trying to lap where we were there, we haven’t had sort of full quarters of normal headcount growth to get back to enough distance above that to get the growth numbers where we would like them to be.

So, I think there is a headcount lapping situation that we need to continue to work on. There are also other sectors that are just not doing as well as we would like. I mean oil and gas is certainly one of them. Automotive is fairly flat but we have a lot of optimism around automotive with regard to some of the new technologies..

And we will go next to Tobey Sommer with SunTrust..

Couple of questions, start with follow-up on the large projects I guess.

You said you knew about the project but it’s little bit bigger, whatever measurement you’d like kind of describe the delta between what your expectation was and where it ended up either in sales or profitability?.

Well, a couple of things. I mean, I think what we knew was sort of it was going to be a pretty good sized project but we just didn’t know it was going to be at the level that we have a history now of sort of letting industrial community know when we have a project of around 5%, and that’s what we do.

In terms of the profitability of the project, we don’t see this as being different profitability. I think we’ve described in the past that all of our consultants in the firm have one bill rate that they use for all of the different works they do.

And therefore, when we have work in one type of field versus another type of field, or sort of one client versus another client, we don’t see that as having an impact on our profitability. The impact on the profitability comes when the utilization obviously goes up but not because it’s particular type of work..

So, when you say you had the projects, probably you were thinking it was in the 2% to 3% range, which is what historically has been considered in the large project by the Company?.

Yes, it was. And when we’d given guidance around what level of utilization we expected to be at in the quarter, we had indicated that we thought the utilization would be down about 2% versus where it was in the same quarter last year, primarily because of the additional holiday at our managers’ meeting in the quarter.

Clearly, this project made up for that delta there which was that sort of 2% difference in utilization..

Okay, thanks.

And then, could you give us a sense for the relationship? How quickly does reactive work convert in the proactive services generally? And is a difference for a large engagements, did to this project for example that we’ve been discussing come from a relationship that was built out of reactive services?.

So, I would say that -- I’ll talk in general and then I’ll give you a sort of more specific answer but relative to this project. I think that in general, there is sort of two ways the things convert.

There is where you have a particular project on why something fails and then as a result, you for example get follow on work to try to help make sure it doesn’t happen again. And so, the proactive work comes literally immediately following the reactive work and is often in the same kind of area.

But, the other scenario simply is that you do some piece of proactive work for a client and sometimes years later they come back to you because they’ve got another issue they want us to look at before they end up in trouble again. And so, they bring us back in.

There isn’t often -- there isn’t always a nexus between when we do the proactive work versus when we do the reactive work. The reactive work often leads just in terms of it from a reputation standpoint. However, there are other clients where the majority of all work we do is more proactive in nature.

And this particular client, the clients we do other work with, it didn’t really result from specific project that we have done before..

Okay..

Some reactive project that we have done before..

Okay. Thank you. Where we sit right now, we are lapping the large projects that went down, now we have one that we’ll probably reference and we comp it again a year from now.

What’s a reasonable period of time in which the Company come close to approaching this long-term revenue growth target?.

Well, I certainly would hope we can -- we’ve obviously given guidance for this year. And we don’t currently expect us to be able to achieve that this year. We talked about low to mid single digit growth rather than high single digit or above growth. So, obviously, we are not projecting that for this year.

I think what we do need to do is we need to get to a point where we aren’t trying to overcome some setback. The setback traditionally been more you have a big project, when that comes off, then you’ve got to overcome that.

We had unusual situation in the second quarter of last year where for a number of different reasons we talked about at the time we had a particularly bad quarter, which did lead to a challenge from the standpoint of growing headcount. And so, we are still trying to get that history behind us.

And I think that’s why I think it’s going to take through this year before we can start looking to the following year..

Okay.

If we get beyond the single large projects that we -- that you have in 1Q and 2Q, how would you characterize revenue from all large projects today in the income statement versus history, are we at a high, medium or kind of low compared to historical range?.

No. I think that this is sort of in the middle. There isn’t another sort of obviously project that is beyond our 2% to 3% range. But I think the portfolio looks similar to what it has in the past when we take out the unusually large jobs..

Okay. Thank you. Two last questions for me.

Is the growth in the proactive side, is that broad base or is it disproportionally driven by consumer electronics, I guess?.

Well, I think it’s disproportionally driven by consumer products broadly including consumer electronics. But it also -- I think the other area of growth that we talk about in the proactive side is the regulatory work that we do in the food and chemical practice, which continues to grow now. Part of that you don’t see quite as much growth there.

There is a little bit offset on that because of foreign exchange, because the majority of that work is run out of the UK. But those are the areas along with medical devices that probably continue to be the strongest areas on the proactive side..

Okay. Last one for me.

How should we think about different pockets of potential relaxation of a regulatory posture under a Trump administration? You benefit -- the company for a long time to see kind of initiatives or agency interviewing more or less in their markets, and to the extent you’ve been able to discern what is the relationship on growth and demand and....

I mean, I think first of all, I guess that the comments that I’ve made before with regard to the selection, I think still hold true, which is that we as a firm have been successful in administrations with Democrat presidents and Republican presidents. I think that the wheels of government change or turn very slowly.

The idea that we’re going to have some dramatic change in government, in spite of all the rhetoric on news, I guess I don’t quite see it that way. What I see is that the direction we’re going in, the slope has changed a little bit or is likely to change a little bit.

In other words, I don’t think regulations have done nothing but get more-strict, if you want to call it that term, over time through Democrat and Republican administrations.

And we have a kind of a little bit of love hate with that because on the one hand a lot of our work comes out of those regulations and that’s good; on the other hand, if they’re so severe that they choke business then that’s bad. So, we’re in that sort of inflection point as well.

And I think it may very well turn not to be the case that there just aren’t as many regulations put in place during the current administration. But in terms of the main things that we work on or the main things that drive a lot of the regulatory work we do, we think it’s unlikely that there is going to be a significant change.

There is norm [ph] what we do, I think as you know from the food and chemicals side, we do a lot of work in their regulatory area around pesticides. We don’t see any move to change any of those regulations. Look at the new headed EPA, he doesn’t talk about that at all. We don’t think that’s a changing environment.

So, I think these changes are likely to be slow and little bit different to discern. I think the one thing that changed sometimes is put the host of the things, people who are thinking about going forward to project as they think the rules might change, may be they delay. And so, I think you can get some of that.

It’s a little bit to some of that Rich talked about earlier which regard to mergers in the industrial chemicals area. If a merger’s going on, that’s not the time you get the next project from and they are trying to sort out, who is in charge and what division is going that and so on.

So, I think you can get into that kind of a situation but we don’t, certainly we don’t sit here worrying that all of our regulatory practices will come to an end because we don’t think they will at all. .

And we will now go to Marc Riddick with Sidoti..

I wanted to ask about -- the current views and may be you could sort of update us on your current views on may be what the appropriate cash balance is for the Company? Is it something that you’ve talked about in the past sort of being in that $50 million to $70 million range? And I was wondering if there is sort of an update on those thoughts sort of given where we’re now..

No, Mark, we don’t -- our view of that has not changed. Both management and the Board, we have always said that it’s a longer term approach to get to that $50 million to $70 million level over a four to five-year period of time.

So, we are trying to be patient and take the right opportunities to utilize the cash, maybe for repurchases, increases in dividends, appropriate capital uses for the business otherwise. But overall, there hasn’t been a change..

Okay, good. Thank you for that. And I was wondering -- you have talked about sort of -- over the last couple quarters and this quarter as well about the growth on the international construction disputes area.

I was wondering if you could sort of give us a general sense of kind of percentage of revenues that that’s now up to and what the opportunities that may be there?.

Yes. It’s a little bit difficult because this does spread across a number of our practices. We have a construction consulting practice that is running about little over 6% of our revenues that is purely around construction consulting.

I would say about half of that business for them is proactive in nature; they involved in project management activities at clients. And the other half is really around the disputes area.

But the real unique market position we have been in is that that team has been able to leverage people from other practices and bring in specialized discipline for different projects. So, it’s a very different team that is working on a project at a power plant than at a LNG terminal than at a mine location.

So, it is a mixture of people across our firm that are coming together on these projects. But again, this is still overall something that is less than 10% of our business that’s around this area..

Okay, great. And then, I think we touched a little bit on the -- in the past about some of the marketing opportunities that you see and some of the things that you were looking to do there.

And I was wondering if you could sort of give an update on the potential for increases with the marketing efforts to stimulate growth in some targeted areas?.

Yes. Well, that’s kind of a timely question because we at the end of March or beginning of April, we just recognized that we have been in business for 50 years and we are using that as a kind of a level point or an opportunity to go out with some new materials.

We have a kind of a book that highlights a lot of our work that I think people find as a very interesting book for that we give to our clients. We did the similar thing when we turned 40 years. And so that is sort of driving a new thrust of our folks going to meet with clients and continue to tell the story.

I think I sort of explained in the past, I mean the kinds of services that we offer to clients are not ones that are typically sold through a what I’ll call a sales staff. They really need to be sold through our experts, because that’s who we are really selling. And we are not sort of in the commodity work business.

And so through that I think this is an opportunity for us to sort of leverage client engagement in that..

It appears there are no further questions at this time. That concludes our conference for today. Thank you for your participation..