Thank you. Good morning, and thank you for participating on today's Q3 earnings call.

Before we begin, I would like to take a moment on Remembrance Day to commemorate the veterans and troops who've dedicated their lives and care for the freedom of our communities. We would also like to extend our gratitude to those within our Converge family who have served.

Your bravery, sacrifice and example are valued each and every day In what follows, I will provide a business update on the quarter, beginning with commentary on our successful expansion into Europe. We will discuss our continued impressive integration results, as well as detail the leadership of our sales and marketing teams, which drove cross-selling efforts in our higher margin business despite the challenges related to supply chain issues widely experienced, and Matt Smith will provide an update on the financials, including a record cash flow generated from operations of $48.1 million, an increase of 86% year-over-year.

Beginning with acquisitions, Converge successfully closed four transactions since July of 2021, including REDNET AG, Vicom Infinity, and Infinity Systems Software, and LPA Software Solutions. Vicom Infinity and Infinity Systems Software are two leading providers of IBM mainframe solutions and IBM software and services.

With more than 20 years of experience, the addition of the Vicom acquisition support the depth of Converge’s Solution offerings, while reinforcing relationships with key vendors, such as IBM. The addition of LPA Software Solutions occurring just subsequent to the quarter complements these efforts in that LPA is designated as one of the full-service IBM platinum partners that sells and implements IBM has business analytic software.

Furthermore, LPA supports Converges cross-selling initiatives by expanding on the company's analytics capabilities with a deep history of providing business analytics solutions and professional services. These world-class analytics capabilities built on our ready strong team, truly differentiates Converge in the mid-market.

In Europe, REDNET AG founded in 2004, and headquartered in Mainz, Germany, is comprised of an established management team operating within key verticals complementary to our customer mix, including education, healthcare and government, which are poised to witness an acceleration in IT spending. With REDNET AG marking our entry in Europe, it acts as a platform acquisition to expand our solutions portfolio on the global scale but also leading the way for our ESG outlook.

REDNET implements a 360 degree holistic approach to increasing IT life cycles through flexible maintenance, while being mindful of environmental and sustainable initiatives. Optimize ecological footprints through the reduction of travel, consolidation of infrastructure resources and visions of healthy IT lifecycle are just a few of the initiatives the company has placed on the top of our agenda.

Other exemplary initiatives within Converge include our diversity and inclusion council that strives to ensure all of our employees are treated equally and fit and feel valued, as well as a wellness program focused on creating healthier lifestyle choices for our team with tools for mental resiliency and financial literacy. We believe these efforts have contributed overall to employee and individual wellness directly correlating to successful metrics in employee performance.

I've often spoke of cross-selling efforts, which we've learned -- result from a healthy mix of clear vision, education and leadership, and successful integration driven by positive communication between our sales team. I'm incredibly proud of the marketing and sales leadership as our team achieved 97 net new logos throughout the quarter, driven by 44 customer facing events with approximately 1,240 external attendees.

Our team has done a fantastic job engaging new and existing clients to our events, such as our Q3 co-hosted event with Red Hat and AWS, which attracted over 404 external attendees. Additionally, since the beginning of 2021, we have hosted 603 executive briefings driving the cross-sell of our higher margin cloud and managed services, alongside of professional services, which we've witnessed increased spending over the past quarter.

Regarding recurring revenue, in Q3 2021, our gross annualized recurring revenue was $338.8 million. This is made up of $81 million of managed services annualized recurring revenue $72.7 million of gross public cloud annualized recurring revenue, and $185.1 million of software subscription support, which are typically paid annually.

One of the key differentiations of Converge is our ability to integrate acquisitions. And we've now integrated 19 of the 24 acquisitions that we've completed.

These integrations include not just people, but tools in areas such as project management, professional services, IT, finance and inside sales. Even though the pace of acquisition has accelerated this year, the integration team has expanded the scope of integration, and will be rolling out a common CRM platform in January.

In addition, we are now starting to streamline our entities and will start to remove some of the legacy branding of entities in 2022. Our industry has been affected by supply chain disruptions with some of our vendors being impacted more than others, especially around endpoint devices.

Bookings, which is orders received from customers that have not been delivered stood at approximately $250 million at the end of Q3 compared to approximately $50 million in the previous year. Had there been -- had there not been supply chain issues, we would have generated an additional $100 million to $150 million in revenue during the quarter.

Normally, we see bookings convert into revenue in four to six weeks, but as some of you will have heard from vendors like Dell and Apple, these dates are being greatly extended due to manufacturing facilities not being able to run at full capacity, and they expect issues to continue into 2022. In addition, our operating costs were impacted by a mismatching of our employee costs and configuration installation, managed services and other services areas who were not able to execute as a result of product delivery date delays.

We continue to communicate with our vendors on these issues and believe that the strong demand we are seeing will results in deferred revenue, but not lost revenue. We continue to execute on our acquisition strategy as well and have the most robust pipeline we have ever had.

Having a strong cash position and generating such strong free cash flow will enable us to execute on the next phase of our expansion in both North America and Europe. On that note, I would like to pass the call to our Interim Chief Financial Officer, Matt Smith to discuss our financials in further detail.

Thank you, Shaun. Third quarter revenue increased 93% to $367.3 million compared to $189.9 million last year.

Product revenue, which includes hardware and software increased 67% to $289.6 million from $173.4 million over the last year, primarily due to the impact of acquisitions completed in the second half of 2020, and those completed in 2021 year-to-date, and the overall strengthening of the IT market as companies began to increase spending now that COVID vaccines have been rolled out. Managed services, which are long-term contracts increased 34% to $20.3 million from $15.2 million last year.

On an annualized basis, our managed services at the end of the quarter grew to over $81 million compared to $61 million last year. And has increased sequentially by approximately $14 million since Q2.

Professional and other services, which includes the net revenue from public cloud resell and software support, increased 84% to $57.5 million from $31.3 million last year. By industry, our revenue breakdown was approximately 12% from the financial sector, 8% from government, 20% from technology, 24% from manufacturing and 20% from healthcare.

As COVID vaccines have increased, we're beginning to see large projects that required in-person services that had previously been put on hold start to be implemented. We expect to see further growth in higher margin professional and other services as supply chain challenges lessen and backlog is delivered to end users.

For the nine months ended September 30, revenue increased 55% to $1.02 billion from $659.2 million in 2020. Product revenue increased 62% to $823.4 million from $509.1 million over last year, primarily due to higher hardware sales to the Canadian government and the impact of acquisitions.

Managed services revenue increased 22% to $52 million from $42.6 million last year and professional and other services revenue increased 37% to CAD147.5 million from CAD107.5 million last year. Gross profit for Q3 increased 60% to CAD83.8 million from CAD52.4 million for the same period in 2020 and gross profit margin was 22.8% compared to 27.6% last year.

For the nine months ended September 30, gross profit increased 42% to CAD229.8 million from CAD162.1 million in 2020 and gross profit margin was 22.5% compared to 24.6%. Last year our high gross margin illustrated how we've been able to successfully transition the companies we acquire from lower-margin businesses that sell primarily hardware to higher-margin software and services businesses through cross-sell.

For 2021, margins are lower due to the fact that we acquired seven companies in the first nine months that sell manly hardware. However, as we cross-sell higher-margin cloud services and managed services to customers of these companies and increase sales to our existing customers as they expand their cloud-based IT infrastructure, we expect gross margins to increase.

SG&A for the three months ended September 30 was CAD66.1 million, increasing from CAD38.9 million in the same period last year. For the nine months ended September 30, SG&A was CAD173.4 million compared to CAD128.5 million last year.

SG&A for the three- and nine-month periods continues to reflect the impact of the CAD20 million annualized savings that we announced last year. As a percentage of sales, SG&A made up 18% and 17% for the three- and nine-month periods respectively compared to 21% and 19% for the same period last year reflecting the integration savings over the last 12 months, which cumulatively have been over CAD28 million on an annualized basis.

Adjusted EBITDA for the three months ended September 30, increased 29% to CAD18.9 million compared to CAD14.6 million last year. As a percentage of revenue, adjusted EBITDA was 5.1% compared to 7.7% last year.

For the nine months ended September 30, adjusted EBITDA increased 60% to CAD59.3 million from CAD37.1 million last year and was 5.8% of revenue compared to 5.6% for 2020. In the near-term, our EBITDA percentage reflects the impact of recent acquisitions which have lower EBITDA margins when we acquire them but increase as we integrate operations and cross-sell as well as higher personnel costs associated with delivering product and managed services for future revenue that we haven't been able to recognize due to supply chain challenges.

Interest and finance expense for the quarter was CAD1.5 million compared to CAD5.1 million last year. For the nine-month period interest and finance expense was CAD5.7 million as compared to CAD15.9 million last year.

These significant savings are a direct result of lower interest costs on our ABL which as we announced in Q4 last year have been switched from a specialty lender to a syndicate of Canadian banks including CIBC, Scotiabank and Laurentian, as well as interest savings as a result of us paying off higher non-ABL debt. This quarter, we generated record cash flow from operations of CAD48 million, which is attributable to year-over-year EBITDA growth and strong working capital management.

At the end of the quarter, total cash on hand was approximately CAD210 million and we had approximately CAD190 million of borrowing capacity under the ABL. And with that I'll pass the call back over to Shaun.

Thank you, Matt. As we continue to produce quality business results and retain satisfied customers, our reputation continues to improve and is reinforced by the four awards achieved throughout Q3 including Ingram Micro's 2021 Blue Series Partner of the Year, CORE Partner of the Year for North America, 2021 North American Microsoft Surface Reseller of the Year in 2021 Microsoft Ingram Micro's Cloud Reseller Partner of the Year.

Additionally, the company achieved AWS migration competency status, recognizing the company's ability to provide technology and expertise to help clients successfully move to AWS migration competency status recognizing the company's ability to provide technology and expertise to help clients successfully move to AWS. The accumulation of industry and Partner of the Year awards has unquestionably advanced Converge's reputation with both our customers and our partners, allowing us to run our business more effectively while delivering solutions to our clients, which will continue to advance on the global scale.

As we reach -- as our reach and reputation expand it creates a strong platform for rolling out new managed services offerings such as the Google Cloud Marketplace solution IP4G, we announced subsequent to the quarter. On that note let me open the floor to questions.

Hey there. Good morning, team.

Question for you on the strong backlog. Look I know it's hard to give us sort of the guidance on the timing of the release of that backlog.

No one's got a crystal ball. But can you give us maybe some comfort on the nature of the backlog?

Other VARs have talked about the fact that they're not seeing any double booking. They talked about confidence in orders not being pulled.

I'm just wondering, if you could just give us a little bit more color on how the conversations and relationships are with your clients and just dig into the nature of those contracts and those orders that are being put in.

Sure. So let me start off first on the German side.

Obviously REDNET has incredible growth and those contracts are exclusive to them. So that's more just making sure as soon as they get them the digital pact that German has with its federated states is that's where all the growth is coming in.

So just fulfilling that demand is really there. In North America, we're seeing again endpoint devices are more impacted than say data center but it's really down to by vendor.

So we have had -- we've seen no issues around our supply of IBM although we sell a lot of IBM software and services also on the hardware side. So I think it does come down to really listening to the vendors.

We communicate very openly with them in order to see that. But we haven't seen the pulling of order.

The only thing we have seen is, as we talked about on previous calls when there are supply disruptions, we tried to provide alternatives to our customers in terms of whether it be certified refurb or alternative choices that they have for people with stronger supply chains. But say we do believe that this will all be deferred revenue and not lost and especially with the largest components of this being really centered around the REDNET acquisition in Germany.

REDNET, right. So the -- you talked about the 100 -- you could have seen upside of CAD100 million to CAD150 million in Q3.

The majority of that is REDNET?

They're a big chunk of that, yes. So you also saw the other vendors being impacted.

So you've got some on the HPE side obviously our Dasher acquisition is one of the largest HPE partners. And then release on the -- Northern Micro increased their inventory levels this year as a mitigation strategy going from a traditional one month of inventory to four.

So that's the way they were dealing with the issues that they were seeing coming down the pipe. So a lot of is just communicating with the vendors and working with them, as we see their commentary on what they're seeing the next year.

And so, again, Q4 also is a very strong software quarter, most of our vendors, our customers, we do an incredible amount of business on December 30 and 31st, for those software renewals, so that business obviously isn't impacted. And we're communicating with our customers too.

Because their budget year ends and our OEM year ends are usually here to get the best discounts. We're encouraging them to not wait until the December, but to act earlier in order to make sure you can get supply, but definitely just working with our vendors communicating and trying to offer solutions for our customers.

Okay. That's good to hear on the different vendors.

IBM, you're not seeing any issues there. I don't think so.

You talked about the acquisition of Vicom Infiniti, I think, that had a strong seasonality in Q4. Can you just give us the view on that business?

Is everything okay there? And your thoughts on the revenue to be delivered from -- to that from that unit?

Yeah. So that's very strong.

So Q4 is by far the strongest quarter. They tend to be very Q2 and Q4 centric.

And we're seeing very strong demand in Q4 for them.

Okay, great. You talked -- just wonder on the OpEx side of things.

You talked about a CRM system coming into play early in January, and then some removal of legacy systems, is there any way to quantify what you think the level of savings would be on an annual basis from all those initiatives, as you think about 2022?

Yeah. So we haven't got that number.

We've, again -- we've spent the last few days going through the management team, all the integrations that, I'd say, it's just so impressive, the way the team has been able to integrate all of these tools and systems into common platforms. I don't have that annualized number for you, but we'll look for you.

As we're implementing that in Q4, we’ll give you a more of a number to look for. But, obviously, they've all had their own systems on a CRM side.

So by replacing those 24 systems with one common platform, there's obviously licensing savings. And, obviously, increased communication and better able to access resources.

So, yeah, the tool set in the suite really enabled a lot of our cross-selling, our managed services selling, there’s lot of initiatives there on the number side, I'll come back to you in Q4, as we're implementing it.

Okay. Thanks for that, Shaun.

Just one last one then, the net new logos still strong, 97 out of this quarter, I think you were a little bit higher in Q2. Can you just talk about the dynamic there?

Were there some wins that will get -- are getting pushed out into Q4. Can you talk about the nature of the logos are?

Are they the similar size? Are they getting bigger, just any color you can provide on the logos there.

Thanks.

So more of that Summer time is July, August. So, again, the team has done an amazing job with the events.

So we did have a very strong Q2 with 129 net new logos. July and August, we actually had some people take some vacation, very well deserved after they've been working so hard, especially during the pandemic.

And then, you really saw this demand pick up again in September. And then Q4, obviously, is by far our busiest quarter.

We are seeing the strategies working. The team's ability to sell, not just one practice area, but multiple practice area, our analytics, our cybersecurity, our cloud, our managed services into these accounts.

Greg and the team has done a great job of that cross sell. So we said we're definitely seeing into our mid market customers.

Matt kind of went through the -- its the same sectors, really, that we're seeing and we're seeing very strong demand.

Okay. Thanks a lot.

I'll hop back in the queue.

Thank you.

Good morning and thank you for taking my phone-- my question. Could you perhaps walk us through Q4 and how you expect to see greater visibility on what that Q4 may be Any milepost that you anticipate in terms of judging your ability to deliver with the supply side constraints recognizing December is big, December 30 and 31 specifically are big?

Yes. So on the 30 and 31 they tend not to be hardware sales as much as software sales because obviously shipping things, we don't recognize revenue until it reaches the customer.

So that's where I say the software part you'll have much better visibility. We're just constantly communicating with our vendors.

Some of -- a large portion of the delays in Q3 were not scheduled. We had had commit dates from vendors that they just couldn't meet that.

So those were surprises. So we have increased our communication on a daily basis with our vendors working through things just to make sure we have that visibility.

And our teams are in constant communication with them as well. So really it's the visibility of it.

We're doing everything we can to make sure we can get products to our customers and solutions to our customers. But again it's -- when you listen to we would ask you to see what Apple is saying see, what Dell is saying on their calls as well and they're seeing some of these challenges going into next year.

If you look at the COVID rates of the manufacturing sites which has really been impacting this there is some improvements on their operating level. They were down to kind of the 40%, 60% and now they're kind of over 80%.

So you're seeing that. But really the best way to looking that and what we do well is be listening to what's coming out of our vendors and working with them.

Thank you. And recognizing the current environment could you talk to the growth in the managed services.

I think it was 34% on the quarter, but what would the organic growth has been? And would you believe you are on track for recurring revenues of 100 million exiting the year?

Yes. So we are on track.

And this is part of the ExactlyIT acquisition which really brings about a lot more of the delivery of these managed services. And talking with our sales teams we've identified our key sales reps and customers in order to roll out these services to.

So yes, we're on track for 100 million is our target by the end of this year -- by end of Q4 and we're on track for that on an annualized basis. And we're looking forward to next year to try to hit that 200 million by the end of the following year.

And the acquisition of ExactlyIT the roll out of these services is going to plan.

And in terms of the organic growth on the quarter would 25% be a reasonable approximation versus the 34% reported?

So it's really tricky to segment like that because what we've done is we've moved -- so it lets you say oh all the ExactlyIT revenue isn't organic because we acquired it but those are from our customers. So it's not that easy to segment it in that manner.

So that's why we just give the overall total number and say on our track to 100 million if that makes sense.

Cool. Thank you and good luck.

Thank you, Rob.

Hi. Good morning.

The incremental 200 million of backlog you're talking about relative to last year can you give us some sense of the duration of that backlog? Do you expect that to fall entirely into Q4, or is that something that you're expecting it will take multiple quarters to wind down?

And then the second part of that of course is do you expect that backlog to stay that high for the next couple quarters or is that going to normalize quickly?

So great question. The backlog obviously has increased from the end of Q3.

Normally, we would see a conversion of four weeks to six weeks with certain vendors. We're seeing those -- like for example the IBMs of the world, we're seeing that stay like that.

So that part of any backlog gets delivered. It's with the vendors especially around endpoint that there is uncertainty on the timeframe.

You're also having some vendors like say a, Cisco who are experiencing more supply chain issues where now they're giving delivery dates which can be as late as Q2. So I think it really is by vendor, but you look at -- obviously our focus is on software and services and managed services are not impacted.

It's on the hardware side and what we're seeing is more on the endpoint device. And really I think you have to look to the vendors and what they're calling out.

Like we have incredible growth especially in the REDNET business. I mean that is one of the ones that's most impacted by this and getting that supply and you would expect.

So what Dell is saying is basically they're seeing this is going to be an issue throughout 2022. We're seeing some improvements in some areas.

And I would expect -- obviously Q4 is a busy area for the entire industry. Q1 tends to be less busy.

So, I think what it would mean is normally their manufacturing facilities would not be on 100% capacity in Q1. So, I would expect to have more of that backlog normalize in Q1.

But again I would really -- for those specific vendors, I mean it's an industry issue. I would look to the guidance being provided by your Apples by your Dells on what they are saying and we're in constant communication with them as well.

Okay. And then -- so most -- there's quite a lot of M&A that falls into Q4.

And so if we assume that all of that is predominantly product or hardware VAR would that be a good assumption? And then if there's a way to parse out Q4 as maybe a percentage of software versus hardware and that's probably a hard number to give is 50-50 a good sort of a guess or you've said software seasonally affects Q4 more.

So should we assume more than 50% in Q4?

And again it's going to be hard for me to judge what that number is. When you look at those percentages and you look at the revenue that REDNET has in particular there's such a variance on what those percentages would be.

And again, for them it's the devices -- but then it's the managed services around those devices and the services around them. So they're kind of the biggest outlier and wildcard as far as really dramatically different numbers.

For most of the rest of the businesses you're -- it's more predictable. Again I wouldn't say 50% software because again 1/3 of our revenue is kind of IBM Red Hat.

And so a lot of those are software and services and those deals tend to happen in Q4 Vicom Infinity Systems those deals will be Q4. So those ones you're feeling very good about.

It's really -- I'd say the biggest impact is on the REDNET side providing great variance and then the conversion of the existing backlog that we have.

Okay. Okay.

Thanks for the color. The EBITDA margins just curious I mean the services number is pretty strong as normally I'd expect the margins to be strong.

I think you gave a couple of reasons. I was hoping you could maybe put some weighting on them for us.

The first one, I think is the buildup of services capacity ahead of the ability to fulfill on the hardware and so there's some utilization? And then the second piece was the recent M&A which typically favors lower-margin VAR revenue and so just the high level of recent M&A.

Is there a way -- are those the two key pieces? And maybe is one bigger than the other?

So, first mix is a big deal. So when you buy these many companies, as you know, when we buy them they're more like 3% EBITDA and when you saw us walk them last year up to 8% EBITDA.

So the mix of basically doubling your revenue in a year, means that you've got the old percentages mixed in with these new ones that we then add the rebates we do the cost we cross-sell the higher margin services. So mix is absolutely one of the issues.

The second thing you're seeing is, there will be transition cost as we move to this new structure with ExactlyIT where you're going to duplicate costs in a quarter as you migrate them to Mexico. So there's that.

And then, obviously as you've commented on with REDNET, they're experiencing such a dramatic growth, we're increasing the capabilities for them to integrate image scale, the devices to meet the incredible demand that they're seeing in Germany. And so, there's a lot of costs associated with that that, when you don't get product, are kind of mistimed in that, you're building up for capacity of what you've been told will be delivered and if they're not then you're not experiencing the same utilization.

So, you'll continue to see -- that's by far the fastest-growing company that we have in the portfolio. And so there's different dynamics around the investments required for that growth, especially with the supply chain disruption.

So I think you've captured mix the transition when we buy them to the Managed Services new cost model as well as the investments to scale. I think those -- you've got those, yes.

Okay, great. And then one little -- just a tiny definition question on your ARR calculation.

If I'm trying to back out Managed Services for the Q3, should I think of that as just the ARR divided by four quarters or is it divided by 12 months based on the last month of the quarter or the last day of the quarter? How are you -- how do I get to a Managed Services number in the quarter from that ARR data?

It's a month -- it's month divided by 12, our month times 12. So we will take the September's number, times that by 12 to get you annualized number.

Okay. So if I divide by 12 it's a little less than -- okay.

So it's a little less than the straight divide by four. Okay.

Thank you.

Hi, Shaun, good morning.

Good morning.

This was a very strong free cash flow quarter. I was just -- wanted to ask on some of the puts and takes you're seeing on the working capital side.

You mentioned deferred revenue maybe inventory is a little bit in flux into the end of the year here. But just wondering what we should be looking out for on the cash flow profile.

Yes. We've really done a great job of kind of streamlining those processes, so extending our terms to 75 days this year, on the one side, while at the same time, streamlining our collection processes.

So that's the combination. And you really see this when you buy all these companies and then move their terms to a very strong free cash flow from working capital.

So you have approximately 70% of your EBITDA goes to free cash flow and then I think it was 34 million -- 35 million in the quarter came from working capital management. And if you look at our receivables versus our payables, it's shown we've done a great job in managing that process.

And that should continue. I would expect Q4 to be a very strong free cash flow.

In comments around what Northern Micro did on inventory, that's a change that they've made from the beginning of the year because of the changes they were seeing on the supply chain. So there wouldn't have been an increase for them around that.

That would have been same quarter -- the same kind of levels quarter-on-quarter. So it's more REDNET's the new one, so that's adding new variability to there.

But I'd say, yeah, very strong free cash flow. I'd expect the same thing to happen in Q4.

Okay. And I was wondering, the inventory balance was flat Q-over-Q, was looking for maybe more of a buildup on the Northern Micro side.

Would you say both between them and REDNET there could be a little bit more capacity built into Q4, or do you think this sort of level maybe as a percent of COGS or sales is where the business could trend through due to supply chain disruption?

Well, the problem you've got with REDNET is they just can't get supply. So it's the, they're growing so quickly it's a different situation where I mean Northern Micro has had robust demand and they were planned ahead for it.

These are new contracts being awarded to REDNET on a constant basis that, they need to fill demand for us. So we – the inventory levels are very low there because of just the lack of supply.

As soon as gear comes in it's being turned around and delivered. So I wouldn't think that they would – as soon as we get gear it's out the door.

So I don't think their inventory levels will be higher.

Okay. Got it.

That's really helpful. I was looking for an update on the IBM iSeries managed offering there.

This is an area you've been a little bit more vocal onto the back half of the year. Is this an area you're seeing traction Europe or North America and maybe becoming more engaged with Google or other partners through the stretch here?

Absolutely and thank you for mentioning it, it's a key area for growth for us. It's a differentiated offering.

And the fact that now we're part of the Google Marketplace and they are selling our solution is really expanding that. And it's not just in North America it is in Europe as well.

And this – by having a differentiated offering in the space it's introducing customers to us that we can then upsell our other managed services to such as our service desk our managed network, our managed security, our managed end user. So this is why we've been focusing so much on the user experience having a good a Net Promoter Score and then access to customers that we then build this pipeline of managed services.

So it's an extremely important differentiated offering for us. And now that we have the capabilities to add these other layers of managed services on top of it, it's rare for a company like us to have other people like an Infor and a Google selling our solutions and being available to the Google marketplace.

So it's a great initiative that will have material impacts next year.

Okay. perfect.

And one more question from my end. When I think of the M&A strategy maybe something you've been thinking about or talking about is that the valuation landscape, could benefit here if supply chain is a headwind for the sector.

Maybe you're seeing valuations become more attractive across the space. So first, are you finding that quite yet?

Is that true or not? And then second is this a dynamic you think could become more pronounced in North America or Europe?

So I think there's two dynamics that are – we have such a robust pipeline now. There's two factors, I think in the US.

There's concerns over capital gain tax increases next year. So people wanting to get the deals done earlier is having an impact.

I think the other part is a lot of these smaller companies, again, some of them can be quite large but in that kind 100 million on to 200 million range they've been – they've made it through COVID and all the challenges they faced. Having supply chain as well.

They just – they want to become part of something bigger so that someone can help them with these challenges. And so I think there's definitely a recognition there of being part of a larger entity that can have greater pull and scale in order to help solve these kind of issues is definitely to our advantage.

So I think both of those dynamics are helping in the incredible pipeline we have for acquisitions.

Perfect. Thanks for taking my questions.

Thanks.

Hi, Shaun. Hi Matt.

Thanks a lot for providing all the colors on the backlog here. That's definitely an important discussion for the day.

I will digress a little and get into the M&A side of things. And my question pertains to the European expansion.

So, you've always indicated that, you are looking to expand and bigger synergies come from the cross sells, having said that, language tends to be a barrier when you look at North America versus U.S. So how are you going to be using your North American entities to cross sell across Europe, or would that not happen?

And both North America and Europe will stay standalone?

It was a great question. So we've the practice, areas that are global are our cloud and our managed services practice areas, the analytics and cybersecurity are separate for that reason.

We do the playbook in Europe, as you put your admin people in Ireland, you put your technical root tech resources in Eastern Europe, and they will support that region. Obviously, when you have the platform acquisitions, the next ones we do will help.

So for red net, the geographical reach into the other federated states. So you can pick-up companies with adjacent geographies, that we can then use the Red Hat management teams to do that local cross sell.

But the Managed Services Group does have German language skills, out of Mexico. And they are already being used to offer man services into the German marketplace.

But we will continue to expand the footprint of some of the services in Europe. If you look at we're very mature right now in North America.

We're in that more of that growth phase, I can kind of compare it back to the early the Phase 1, that I had there, the advantage being that we've got such a different kind of relationship from a branding perspective, as well as with our vendors. And obviously having a guy like Thomas Volk and Doris Albiez in the market, they're very well known, has been tremendously helpful as well.

So as far as the as the areas that will be some differentiated part of the services, we're definitely one company though, common tools. So the same CRM systems that are being rolled out in North America, are being rolled out, as well in Germany, but some of the some of the service areas, we will see, if you've made those people cross the pond, they've quit.

That's helpful. Thanks, guys.

Thank you, Divya.

Thank you very much for taking my follow-up. And my questions on the, the backlog and the supply side issues, to what extent as the weakest link, theory apply, i.e., where you have a multi-vendor solution.

RBM may be delivering in four weeks, but it also has Cisco net Q2 is the whole project deferred to Q2, including software, just kind of get a better sense for that linkage.

Yeah. That tends to be more of a large enterprise issue than it does for a mid-market issue where we're able to roll out our solutions, and especially in the cloud side.

So we're not seeing that bundling up. Whereas if you were delivering such as a, an SAP data centers solution, they're all kind of tied together.

That's not really our business. What we're doing is those kinds of solutions may be moving to the cloud.

So it's a good question. But no, that's more of a large enterprise problem and a mid-market problem.

Thank you for a clarification.

Thanks.

Well, I'd like thank everyone for participating on today's call. And I look forward to updating our shareholders again, when we announce our annual results.

And thank you for your continued support.