Insperity Inc (NSP) 2017 Q3 法說會逐字稿

Good morning. My name is Jesse, and I'll be your conference operator today. I would like to welcome everyone to the Insperity Third Quarter 2017 Earnings Conference Call. (Operator Instructions) At this time, I would like to introduce today's speakers. Joining us are Paul Sarvadi, Chairman of the Board and Chief Executive Officer; Richard Rawson, President; and Douglas Sharp, Senior Vice President of Finance, Chief Financial Officer and Treasurer.

At this time, I would like to turn the call over to Douglas Sharp. Mr. Sharp, please go ahead.

Yes, thank you. We appreciate you joining us this morning.

Let me begin by outlining our plan for this morning's call. First, I'm going to discuss the details of our third quarter 2017 financial results. Paul will then comment on our recent results and our plan as we head into 2018. I will return to provide our financial guidance for the fourth quarter. We will then end the call with a question-and-answer session where Paul, Richard and I will be available.

Now before we begin, I would like to remind you that Mr. Sarvadi, Mr. Rawson or myself 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 the 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 me begin today's call by discussing our record third quarter results. Adjusted EPS increased 46% over Q3 of 2016 to $1.14 and adjusted EBITDA increased 38% to $43 million, both significantly above the high end of our forecasted ranges. Through the first 9 months of 2017, we are ahead of our initial budget, having generated a 26% increase in adjusted EPS over 2016 to $3.80.

As for the details. Average paid worksite employees increased 10.5% over Q3 of 2016. The worksite employee growth resulted from new client sales, driven by a 12% increase in the average number of trained Business Performance Advisors and client retention of 99% during the quarter. Double-digit worksite employee growth continued in spite of a headwind from the disruption caused by the recent hurricanes in Texas and Florida. Additionally, we experienced an overall net loss associated with employee hiring and terminations by our client base during the quarter compared to a net gain in Q3 of 2016.

Gross profit increased 19% over Q3 of 2016 on the 10.5% worksite employee growth as our direct cost programs trended favorably and pricing allocations exceeded forecasted levels.

Benefit costs, and in particular health care claims, came in significantly below our forecast. Additionally, workers' compensation costs continued to develop favorably as a result of effective [safe] and claims management services.

The elimination of double taxation of FICA and FUTA associated with the SBEA law came in at an expected level of approximately $1 million.

Third quarter operating expenses were managed below forecasted levels, outside of an additional accrual for incentive compensation tied to our outperformance during the quarter and charitable activity associated with Hurricane Harvey relief efforts. We continued to invest in our growth, including an increase in a number of Business Performance Advisors, and in our technology, including our new Insperity Premier HCM platform.

Now as a result of our growth and effective management of gross profit and operating costs, adjusted EBITDA per worksite employee per month, which is our measure of unit profitability, increased 24% from $62 in Q3 of 2016 to $77 in Q3 of this year. Year-to-date adjusted EBIT dollars have increased 18% over the 2016 period to $139 million. This is just a couple of million dollars below our 2016 adjusted EBITDA due to our continued strong growth and operating performance.

Now moving on to our balance sheet. Due to our strong cash flow generation, we ended the quarter with $105 million of adjusted cash, up from $45 million at the end of 2016 and continue to have about $95 million available under our line of credit.

Our financial strength continues to allow us to focus on shareholder return through our share repurchase and dividend programs. Thus far in 2017, we have repurchased 349,000 shares of stock at a cost of $27 million and paid $18 million in cash dividends.

Now at this time, I'd like to turn the call over to Paul.

Thank you, Doug. Today, my comments will cover 3 primary topics. First, I'll provide some detail regarding how Hurricane Harvey affected Insperity and our response to the devastation caused by the storm. Secondly, I'll discuss the key drivers to our continuing excellent financial performance in Q3 and year-to-date. Lastly, I'll discuss our outlook for the fall campaign selling and retention season and our first impression of how 2018 is shaping up.

Our strong financial performance continued in Q3 as a result of sustained double-digit unit growth, strong pricing and management of direct costs and ongoing operational excellence. This was in spite of the considerable disruption caused by the unprecedented hurricane in Houston, the home of our corporate headquarters.

Harvey hit Houston and the surrounding area in a manner that was epic in a number of ways. The storm lingered on for nearly a week and poured rain across 150-mile radius with rainfall totals equaled to expectations for an entire year. This event required considerable attention for several weeks beginning around August 21, the week before the storm hit, then intensified considerably during the week of and the week immediately following the storm. This disruption has waned since but continues even to some degree now as recovery and rebuilding efforts are still a work in progress.

Insperity has a disaster recovery plan and team that performed incredibly well when this real calamity hit. No plan can anticipate the exact circumstances of a disaster, but an effective plan includes the agility to respond to whatever does occur. In the week leading up to the storm, our team accelerated all the possible service requirements to reduce potential workloads during the event and communicated emergency plans appropriately, both internally and externally.

The first priority once a disaster actually strikes is the safety and welfare of people, including our own corporate employees, our clients and worksite employees and their families. Since we are the HR department for our clients, we are the repository for emergency contact information and a facilitator in meeting the immediate need of ensuring everyone's safety. This was an ongoing process for many days as widespread flooding occurred due to continual rain and necessary opening of dams and reservoirs. We have over 1,400 of our 2,750 corporate employees and over 1,200 clients with nearly 20,000 work-site employees in the affected areas, so just the effort to meet this top priority was substantial.

I'm going to spare you the details about the stages of the disaster and the agility of our response, and I'm going to focus on 3 bottom line outcomes from the experience.

First, we are not aware of a single service request from across our entire client base that went unfulfilled during the entirety of this event. This is truly amazing considering the scale and duration of this storm, and I must give credit to our amazing corporate employees and our disaster recovery team.

Secondly, the demonstration of the Insperity corporate culture, including the professionalism to meet commitments, the caring for clients and employees and the support of our community at large, was on full display throughout this event. This special culture that overcomes challenges to meet business and financial goals performed with flying colors when it really counted and people's lives were at stake.

The third outcome from the storm was the temporary and limited disruption to worksite employee growth as we dealt with the necessary distraction of the disaster for nearly a month of the third quarter. All 3 drivers to paid worksite employee growth paid from sales in the queue, retention and net change in employment at client locations were below expectations in September, resulting in unit growth slightly below our range -- or expected range for the quarter.

In spite of the interruption, we continued double-digit growth in worksite employees driven by growth in the number of Business Performance Advisors, maintaining sales efficiency and solid retention. Year-to-date, we are slightly ahead of sales forecast at 101%, although we were slightly below forecast at 92% in Q3.

In the quarter, we achieved a 14% increase in total hired BPAs and a 12% increase in average trained BPAs while maintaining the same level of efficiency over the third quarter of last year. This demonstrates our capability to recruit and train BPAs and support them with effective marketing efforts.

Corporate leads, social media followers and unique visitors to insperity.com are all up more than 30% year-to-date and for Q3. Our marketing programs, including digital channels and customer loyalty programs, are all performing well, contributing 56% of [sold] worksite employees year-to-date.

Retention of accounts continued at a very high level of 99%, however, included the termination of one of our largest accounts due to an acquisition, which we discussed last quarter. We are continuing to see very high client satisfaction levels and strong demand for our services driving these results.

So our primary drivers to unit growth remains strong. However, we also saw a dynamic in the hiring within our client base this quarter worth noting.

The third growth driver -- this third growth driver largely out of our control is the net gain or loss from clients hiring and terminating employees. This metric has continued to run below expectations, and in fact, was negative 2 out of the 3 months in the quarter and 4 out of 9 months for the year. This is in contrast to what our historical employment growth indicators would predict. Overtime, as a percentage of base pay, was 11% and commissions paid to the sales staff of our clients was nearly 7% in Q3. This combination, along with positive sentiment from business owners about the economy, typically coincides with robust hiring.

We have seen an increase in job openings, but filling the jobs has been more difficult of late. The labor market has shifted from employers selecting from among a number of qualified candidates to candidates selecting from among multiple employer offers. This is consistent with data and anecdotal information from our recruiting division regarding the difficulty finding qualified candidates, the length of time to fill positions and candidates indicating they have multiple opportunities.

So the big picture on growth this year-to-date is we continue to drive double-digit growth throughout the year in spite of weaker-than-expected net gains in the client base, the loss of one of our largest clients and the interruption of Hurricane Harvey. In spite of the slight volume variance experienced in the quarter and year-to-date, 2 underlying trends in other aspects of the business have allowed us to outperform at the bottom line: our pricing strength and management of direct cost has combined with our operating leverage, more than offsetting slightly lower unit growth.

Now at this point of the year, it's critical to have momentum in our fall selling and retention efforts in order to have a successful year-end transition in new and renewing accounts. This is important to achieve a starting point in paid worksite employees in January to continue our strong multiyear trends in our financial performance.

The most important metrics to focus on at this point in the campaign are mid-market sales and retention and the pipeline of business profiles for new core sales.

We look at mid-market sales in the pipeline and mid-market termination notices scheduled for January to see if we are on target for our baseline objective of offsetting terminations with new sales in this segment. At this point, we appear to be in good shape on this front, with mid-market sales scheduled for January payroll running ahead of termination. This can certainly change over the quarter. But so far, so good.

In the core market, the number of business profiles has ramped up at an unprecedented pace, providing confidence in achieving our targeted sales goals for the fall. We have to execute effectively in closing and enrolling accounts, but it's always comforting at this point to see such a full pipeline.

It's too early to get a measure on retention in the core market, but we are encouraged due to the stable pricing in our direct costs, including benefits and minimal plan design changes for the benefit plan year ahead. This combination historically supports high retention at year-end.

We also had the added advantage this year of the introduction of Insperity Premier, which we announced this quarter. This unique co-employment HCM platform has been very well received, and we're on track with the rollout of this upgrade. Over 1/3 of our cloud-based activity is already occurring on the new platform, and we expect to reach our target of completing this upgrade across the customer base by year-end.

Therefore, we have a relatively high level of confidence in the successful fall selling and retention campaign and year-end transition ahead. Our confidence is also bolstered by the past 3 years in a row where our execution through this period each year has allowed us to start the new year at double-digit unit growth rates.

This quarter, we will be completing our detailed budget for 2018, so we will not provide specific guidance until next quarter. However, we can provide some high-level information to frame next year.

First, we are ahead in total hired Business Performance Advisors, exceeding our target of 475, which was our goal for year end. This is the most important key metric for driving consistent, predictable growth in the future. Therefore, we expect to continue double-digit growth in worksite employees next year, with the range of that growth dependent on the starting point, which we will know in January.

Our outlook for profitability is also favorable, with positive trends in pricing and direct costs including the full year benefit of certification under the Small Business Efficiency Act. We would also expect some level of operating leverage to continue, offset by some investments in BPA growth, office expansion, marketing and technology investments. We will determine this in the budgeting process this quarter.

So when you put these pieces together, we would expect adjusted EBITDA growth slightly above unit and gross profit growth rates. As usual, we'll be conservative early in the year and work a plan to control risk and cost throughout the year to build that spread similar to the last few years.

So in summary, we have had an excellent year so far, and we're all systems go for a strong finish to 2017. We're in position for a successful fall selling and retention campaign, which we believe will set us up for continuing our outstanding financial performance and superior returns to shareholders next year.

At this time, I'd like to pass the call back to Doug.

Thanks, Paul. Now before we open up the call for questions, I'd like to provide our financial guidance for the fourth quarter and some comments on our general outlook as we head into 2018.

As for worksite employee growth, we continue to expect strong sales in client retention over the remainder of 2017. When combined with our starting point for Q4, coming off of the storm impact in the third quarter, we are now forecasting fourth quarter average paid worksite employee growth to be in a range of 10% to 11%.

We are increasing our full year adjusted EPS guidance based upon our strong year-to-date results and an improved Q4 outlook in our pricing and direct cost programs. We are now forecasting an increase of approximately 32% in adjusted EPS for the full year 2017 over 2016, up from our previous guidance of 25% to 28% and our initial 2017 guidance of 17% to 23%. Q4 adjusted EPS is projected in a range of $0.91 to $0.95, an increase of 57% to 64% over Q4 of 2016. As for adjusted EBITDA, we are forecasting a range of $36 million to $38 million for the fourth quarter, which is a 56% to 65% increase over Q4 2016. This puts us on target for a 25% increase in full year 2017 adjusted EBITDA over 2016 to approximately $176 million and a record level of $80 per worksite employee per month.

Adjusted EBITDA per worksite employee per month is a key metric for our business, as it is a measure of our ability to effectively manage pricing, direct costs, operating expenses and risks while growing worksite employees at targeted levels. We have experienced a consistent improvement in this metric, from $54 in 2014 to $63 in 2015 to $71 in 2016 and now forecasting $80 in 2017. This demonstrates the successful management of gross profit and leverage of our cost structure while achieving double-digit worksite employee growth over the past 3 years.

As we look forward beyond 2017 and continue to execute our strategic plan, our goal will be to continue double-digit worksite employee growth with a slightly higher adjusted EBITDA growth on improved pricing, effective management of direct costs and continued operating leverage.

In conclusion, we are pleased with our strong growth and profitability in 2017 and are now focused on closing out a successful fall sales campaign and year-end renewal period to position us for a strong 2018.

We will be providing our detailed 2018 guidance on our next earnings call, and we look forward to talking to you then.

Now at this time, I'd like to open up the call for questions.

(Operator Instructions) Your first question comes from Jim MacDonald with First Analysis.

Could you tease out a little bit for me -- so you're a little bit below your worksite employee guidance? How much was due to the hurricane? How much was due to lower hiring? And is there any way to kind of tease that out?

Yes. Jim, it was basically the, as we look back on it, just flat the interruption of about 3 full weeks, pushing the pipeline out a little bit on enrollments. Some terms -- just like I said, across the board in September, all 3 of the growth drivers were below expectation, and it's really hard to parse it down to that level of detail. But from our perspective, it's related to the storm.

And were some of the layoffs, if you will, at existing accounts, were they due to the storm as well?

Well, we report paid worksite employees for month to month, so it certainly is possible. Some folks didn't get paid that month at all in the month September. Even in our local area here, we had -- we've got quite a few businesses that literally were shut down, some won't reopen. Now those -- not talking about in our client base. I'm just talking about representatively in our community. And to some degree, some of that has happened across this large area. But we see it as a very temporary thing. Things are back up running. Everybody's working. There's a little bit of work to do obviously for those who were affected, where they have to rebuild and stuff. But it's more like just an interruption. You had 3 weeks of doing completely different stuff than what the normal stuff that you do in this area. And that flowed through the numbers a little bit, but we're off to the races for the fall campaign and in good shape.

Okay. And then just one more for me. Can you give us the number of trained BPAs you have at the end of the quarter?

Let's see. Yes, we'll get that for you in a minute or 2.

Your next question comes from Tobey Sommer with SunTrust.

I was wondering if you could update us on the outlook for health care cost growth at the company and what the differential may be with what you're hearing the market rate of growth may be next year.

Yes. Tobey, this is Richard. I would tell you that we've seen very solid trends for 2017 that when we look at the end of the year, when comparing benefits cost on a per covered employee year-over-year, it's going to be probably in the 2% to 2.25% range. And we're seeing pharmacy trends are higher than we have in the past couple of years, but the medical component of our plan is running really well. So it's a little bit early for us to take too much of a lookout into 2018. What we've seen so far and the things that we're doing inside the company as it relates to some new software tools to help people figure out what benefit plan they should be buying, it's a really new intuitive tool that we launched with our Insperity Premier product platform. We think the combination of those should actually help us to manage the costs for 2018, and so we're not looking at big significant increases.

Could you give me a sense for what the market rate of growth would be to compare to that 2% to 2.25% for '17?

Sure. We look at the Kaiser Family Foundation. And every year, we compare their small business book, their large business book and we compare it to what ours are. And I don't have the numbers off the top of my head. But I'm going to say in the large business group, that trend is about 4.5% -- or excuse me, in the small business, it's 4.5%. And in the large business, it's about 3.5%, somewhere in that vicinity for this last year.

Yes. We're actually feeling real good about that -- how that's even playing into this fall campaign season in terms of the stability of our costs and pricing compared to what's going on in the marketplace.

Great. Paul, how much time do you think we need to let pass for an accurate assessment of the impact of the changes from the IRS regarding double taxation of the payroll taxes?

Yes. I think we have a pretty good handle on that. We've had -- remember, we're certified in June. And so you kind of have the last half of the year in the books here, and that's hit our numbers that we were expecting for the quarter. I think Doug mentioned, it was about $1 million.

I actually meant the impact on the sales growth and the seasonality of the business, not necessarily the cost savings near term.

Yes, that's great. It's going to be a little while. But I would say over the next 6 to 12 months, we're going to have quite a better feel of that. It will be interesting to see how this year-end transition goes, especially with regard to the ones that you get close to the edge but can't quite get over by for a Jan 1 start. We used to kind of have those that would then delay considerably into the next year or even push out a whole year. And now that you don't have that, we're hopeful that you have more of a continuing closing effort early in the year, February, March, those months that a lot of times you have some that are pushed out.

My last question, are there any areas of investments, either software tools, internal development or maybe even acquisitions? And I asked that in the context of your building cash balance and the ability to buy back stock and raise the dividend, et cetera.

All right. Thank you for the question. Yes, we do keep our eyes open to other possible things. In our world, we've got this model working beautifully. If we're going to do something like that, it would have to move the needle substantially in some way. So we have a pretty high threshold for that. But we do keep our eyes open for things we can do. As far as -- also another factor there is on the technology side, our development efforts are so strong right now. And we are -- our output of what we're able to do for our small and midsized customers with our own development is at a rate where it also raises the threshold of what you would try to buy out there that we can do on our own. And so I think we're really in that point. You've got cash building up again. And I'm sure our board will sit down and take a look at what we do to continue to return to shareholders. If you look back the last 3 years, we have returned to shareholders in the form of dividends and buying shares back nearly $400 million, which is equal to the amount of adjusted EBITDA or slightly over the amount of adjusted EBITDA over that same period. So we have a strong history and track record of returning to shareholders. The beautiful thing about the cash flow in this business is that we can continue to do that.

So it sounds like a bias towards internal organic growth for now?

Yes, it is.

Your next question comes from Jeff Martin with Roth Capital Partners.

Paul, I was wondering if you could comment -- maybe this is a question for Doug, but the revenue per worksite employee per month the last 2 quarters has trended up. Curious to peel the layer of the onion a little bit and get some insight into that and if that's sustainable.

Yes. I think it goes to my comment, as I mentioned in the script, about some -- the improvement in the pricing that we're getting and various pieces of the gross profit. So in our service fees, along with some of the allocations of the direct costs, that's moving that number up. I think it's really about some pricing strengths.

Yes. I think the thing that punctuates that, Jeff, is that when we look at our migration of customers going to the less expensive plans and realizing that those allocations are in our revenues and our revenues are up year-over-year, that is 2 great signals. Revenues are growing because of the price strength and the costs side on the benefits when they're selecting lower-cost pay -- plans actually translates to a positive in the future period.

I think the other thing from a going forward perspective, we are really able to demonstrate the value of the technology that we're deploying with Insperity Premier in the core business and even in our Workforce Administration offering. And we're hopeful that, that will also present some added pricing strength in our ability to renew accounts with some extra allocation for those improvements and the same on the new sales side. When we're taking customers through the demos of the new HCM system, it's really, really been well received. And I think that lines up again with our premium service offering and our premium pricing.

Great. That's helpful. And then, Paul, your comment around the unprecedented pace of ramp of new business profiles relative to the start of the fall sales campaign, I was curious if there's anything in particular that is driving that or if that's more you've got more trained BPAs and their tenure is getting longer.

Yes. That's kind of fresh hot off the press and a pretty green kind of number here into -- even into the fourth quarter. So I'm going to wait to let that mature, but we've got a really fantastic pipeline for new business. And our business profile increase over last year is a lot more than the 14% increase in BPAs that are hired. So that is a sure sign of a lot of things. It's a sign of a lot of effort going on in the field right now, good demand for what we do, good marketing programs that are getting opportunities -- increasing the opportunities, which we always do at the beginning of the fall campaign. And so that's exactly what you're looking for as you go into this time of year. And to have that kind of unprecedented boost in business profiles, hey, that gives you the opportunities. Now you just have to be effective at closing and enrolling accounts.

Great. And then my last question is, have you seen any warning signs of potential credit issues among the small business base in Houston? Are they having liquidity issues at all? And are you seeing anything like that in your numbers?

No, we haven't. Our credit department has not seen any uptick along the lines of any kind of defaults from the Texas base, so we're working well through that. And I think, in addition, the retention levels stand at that 99% and no really aberration from the Texas clients. So things are still looking good along those fronts.

(Operator Instructions) The next question comes from Greg Mendez with Baird.

This is Greg on for Mark Marcon. Just this kind of goes off on an earlier question. But can you just give any thoughts to how you're thinking about the benefit if we happen to get tax reform and how you would think about using that cash? It sounds like maybe it would be -- buy back some dividends, but just any thoughts there.

Yes. First of all, I think if we can get tax reform -- I'm not sure I can think of anything that would have more of an effect on employment growth as long as we can find people to fill the jobs. But I really do think that would be huge for small and midsized businesses and for moving their plans forward faster. Obviously, for us, our tax rate is high, and that would spin off a lot of dollars and we would be able to increase the rate at which we either do buybacks or dividends, return to shareholders probably be a priority. But it also allows us to just accelerate our plans in any way that we can. So we're hopeful that can come about, although it's been a real stalemate over there in Washington, and we'll see if anything comes out of there or not.

Sure. And then specific to the -- to kind of what you've seen in October, are business trends back to where you thought they would be? Or essentially, are we still getting back to plan following the dip in September?

Well, I think as far as in the areas that were really affected by the hurricane, et cetera, things are pretty much back to normal on the business front. And obviously, there's still people trying to repair and recover from the storm, but we're not seeing any more effect on the business side.

Okay, great. And my last question. It sounds like the early feedback you're hearing from clients is pretty positive on Premier. How is the migration process going, moving the client base over? How are you thinking about that just time line-wise?

Yes. We're really in good shape on that front. We -- as I mentioned in my prepared remarks, we're over 1/3 of the -- of all of our cloud-based activities happening on Premier now. And that's a little bit ahead of what our plan was for the time period with -- the plan was a roll-in through December -- at the end of December. We wanted to be able to kind of turn the old system off, cause they're running kind of in parallel. And we're on track for that. We're in good shape there. In fact, I actually think last week about -- that was -- the amount of actual payroll-related activity was over 45%. So we're well on our way. It's being well received. Our ability -- capabilities in there with co-browsing and click-to-chat means that we are able to help people use the new system easier in real time. And so I think we're getting some benefit out of that as well.

Your next question comes from Tobey Sommer with SunTrust.

Paul, I was wondering if you could just give us an update on the importance and impact that you're seeing from your digital marketing loyalty programs and channel partners on sustaining the double-digit worksite employee growth.

Thank you. Yes, it's really important that we have the marketing effort working to serve up enough opportunities. I mean, we are -- if you'll recall, our Business Performance Advisors, it's a highly trained, highly seasoned professional staff. And they are incredible advisers to small businesses. And their best use of their time is in front of qualified prospects, talking about their businesses and how improving their people strategy will increase their odds of success. And that's where we want them to be spending their time. So the better job we can do on our marketing effort to produce leads then the, more likely we're able to at least maintain efficiency at a high growth rate in the number of Business Performance Advisors. So all that has to work together. And we do have 3 really strong legs to the stool right now that are all working. One is the loyalty programs, where we are -- we hold events in different -- in cities all across the country with our client base and prospects and nurture life, leads for our BPAs to follow up on. We have channel programs through others -- centers of influence and other folks that provide -- through a contractual relationships that we're working on, we're able to call on accounts of -- that others bring to us. And those are very good closing rates as well as the loyalty program. And then the way people get their information these days, of course, business owners is through the digital world. And so our efforts in that area have been strong. We have greater than 30% increase in all the things that you track in that area for the year-to-date and for the third quarter. So we're doing well there, and I don't see a reason we can't sustain that going forward. It will be a big part of supporting our efforts in 2018.

Your next question comes from Jim MacDonald with First Analysis.

Yes. Just a couple of quick ones here maybe. So you mentioned benefits performance was much better than you expected. Was that the majority of the increase in gross profit versus your expectations for the quarter?

Well, certainly, it was more than, obviously, than we expected, but we still had a nice increase, better-than-expected results in our workers' comp program as well.

I'll also say that the pricing side of that [grow] as well.

Yes, yes. So it's really the 3.

So any way you can give us some -- which one was bigger?

Yes. The benefits was actually bigger this quarter.

Okay. And just one -- you didn't give the share repurchases in the quarter. You gave year-to-date. Any -- could you just give us that number for the quarter?

I don't have the number exactly, but not so much in the third quarter as we did in the second quarter. We put a 10b5-1 plan in place every quarter and set the price sort of where it was existing at the time that plan was put in place. The stock has gone up since then. And so didn't purchase back quite as many in the second quarter as we had hoped to.

Yes. The stock price kind of ran away from our 10b5-1 plan.

There are no further questions at this time. I will turn the call back over to Mr. Sarvadi.

Well, thanks again for joining us today. We appreciate your interest, and we look forward to seeing you either out on the road or back on the call next quarter. Thank you very much.

This concludes today's conference call. You may now disconnect.