Thank you, operator. Good morning, everyone.

We are pleased to be here to discuss Element’s second quarter performance, which includes record results driven by commercial wins and client growth. We continue to deliver a superior client experience in all five countries we serve.

And we’re successfully executing all five drivers of our revenue growth strategy, by retaining 99% of our existing client base, expanding our share wallet with those clients, earning market share from our competitors, converting self-managed fleets into new clients and securing government mega fleet mandates. To put this into context this quarter, we earn market share and welcoming 23 new clients, we converted 25 self-managed fleets, and we continue to expand our share of wallet with 124 preexisting Element clients.

These wins represent a potential addition of over 20% more vehicle vendor management than what our global commercial team accomplished during the same period in 2022. In addition, an important part of our performance was the impressive $2.5 billion of new vehicles that we were able to originate for our clients.

This was a function of steadily improving OEM production capacity, which of course is great news for both our clients and our shareholders. And as we communicated last quarter, our backlog of orders continues to remain at elevated levels, and is expected to carry us well into 2024 with $2.6 billion of contractually committed future origination volume.

Moreover, our clients demand for new vehicles continues to be strong as they placed $4 million of orders our record in the first half of this year. Now pivoting to ESG, we published our third annual report in June, containing full disclosure of our Scopes 1, 2 and upstream Scope 3 greenhouse gas emissions.

And we’re currently working on the establishment of science-based emission reduction targets, and expect to share those with you in 2024. That said, we’ve already been taking action to reduce our environmental impact.

We achieved a 55% reduction in Scopes 1 and 2 emissions in 2022. And that’s relative to our 2019 base year.

And it’s thanks to our internal fleet electrification efforts, and decreased energy usage at our offices. Regarding electric vehicles, we launched and guided numerous clients’ pilots across our global footprint with the full suite of RFI Element’s services, our strategic consulting capabilities and EVs continues to garner strong interest from clients and prospective clients, particularly in the self-managed space.

Now, before I hand it over to Frank, I want to thank our entire team at Element for your continued dedication and hard work. Without you these record results would not be possible.

Now looking ahead, we continue to have lots of opportunity to grow and further improve our performance with planned and paced investments in our business. And with the continued execution of our strategy, this is an exciting time for Element.

And we are looking forward to sharing future successes with you. Over to you, Frank.

Thank you, Laura. Good morning, everyone.

It’s great to be demonstrating Element’s ability to deliver on our client value proposition and generate strong results across the business. Two things before I take you through these – those results.

First, we disclose this time last year, we are in $8 million of non-recurring net revenue in Q2 2022. Excluding that from year-over-year comparison shows the organic growth of the business.

So I’ll be citing growth on that basis. And second, the growth measures I cite will also be in constant currency.

Because strengthening of both the U.S. dollar and Mexican peso benefited our Q2 results as reported.

After normalizing for those factors, our second quarter growth was still near the high end of our long-term guidance ranges and very strong in absolute terms. We grew net revenue 8.4% year-over-year to $323 million for the quarter.

Adjusted operating income grew 4.5% on the same basis, despite increased investment in our commercial capabilities, which I’ll come back to shortly. Operating margin was 55.1% for the quarter consistent with our guidance.

Adjusted earnings per share were $0.33, which is a 10% improvement year-over-year. And free cash flow per share was $0.46, which is a 22% improvement year-over-year.

It’s worth noting that Q2 free cash flow benefited somewhat from the timing of cash payments and cash inflows from originations in the first half of this year. Normalizing for those items, free cash flow per share would have been approximately $0.42 in the second quarter, and the incremental $0.04 would likely benefit the second half of this year equally.

For certainty, we will reaffirm our guidance of $1.58 to $1.63 of free cash flow per share for the full year. Looking more closely in our second quarter net revenue growth year-over-year, it was driven by services revenue and net financing revenue growth.

The first pillar of our capital lighter business model is services revenue. Consistently delivering superior client services is fundamental to our value proposition.

These services result in our clients and their drivers developing a near daily working relationship with Element, which is the stickiness that enables us to retain almost 99% of our business annually. Services revenue was up 12% year-over-year, driven by share of wallet growth, namely increased penetration and utilization, as well as modest growth in ANZ, Mexico and Armada services revenue streams.

We’ve quantified the relative value of these contributions in our supplementary information document for Q2, and included further detail in the MD&A results commentary. Net financing revenue grew 6.4% year-over-year driven by average net earning assets growth of 6.2% and interim funded asset growth of 100%.

Each of these asset categories grew as consequence of a record $2.5 billion of global originations in the quarter. Year-over-year gain on sale or GOS growth also contributed net financing revenue growth.

In Q2 GOS moderated slightly in Australia, New Zealand compared to the second quarter of last year. However, this was more than offset by das GOS in Mexico on the same comparative basis.

Now I’ll turn to the second pillar of our capital lighter business model, which is syndication. We syndicated $690 million of assets in the second quarter, and generated $11.4 million of revenue.

That represents 1.65% yield on the assets syndicated were 35 basis points shy of the 2% long-term average yields we continue to guide for modeling purposes. As we’ve said before the continuing uncertainty around interest rates to sustain elevated spreads, which compress available syndication deals.

Remember, the biggest benefits to Element of our syndication program are first, the ready access to off balance sheet funding for growth. Second, the ability to manage our tangible leverage ratio.

Third, the accelerated revenue recognition and increased velocity of cash flow which we can redeploy for attractive returns and fourth the freeing up of excess equity to reinvest in the business and return to shareholders through buybacks and dividends. Our access to capital through syndication remains deep and we are confident that we can syndicate the volumes implied by our full year guidance.

A second half originations should provide ample inventory for a syndication team to work with. Turning now to operating expenses, we knew the modest increase was coming this quarter as planned, which we signaled in May.

And this increase reflects both practical and strategic choices as well as inflation. Given our confidence in longer, high – long-term higher annual organic revenue growth potential of 6% to 8%, which is up from the previous 4% to 6% run-rate outlook.

We need to resource our teams to lead, manage and fulfill this potential. Resourcing properly means hiring and developing the right talent in the right roles.

It means continuously improving our market leading capabilities, and it means facilitating meaningful client interactions through travel and events. As we exit the pandemic era, and increase our commercial ambitions.

We are also investing in our service delivery model to sustain the growth of our net promoter scores, and lower our cost to serve. The healthy returns on the OpEx investments are already being demonstrated.

For example, in our second quarter results, and in the commercial success profile that Laura shared. That commercial success will have lasting impact on our performance over the next several years, such as the nature of our incremental recurring revenue growth model.

I want to briefly discuss sustaining capital investments, which we disclosed in our calculation of Element’s free cash flow in the supplementary. We expect to make between $75 million and $80 million of sustaining capital investments this year, which is more than we have in recent years.

This is partly a function of inflation on the $50 million to $55 million in annual sustaining CapEx range we first set out several years ago. However, that range was predominantly focused on IT spent.

As Laura mentioned, we’ve been electrifying Element’s internal global fleet, which will impact our sustaining capital investment totals both this year and next year. We will also be optimizing certain of our real estate footprints over the next 2 to 3 years, the cost of which will be partially comprised of incremental sustaining CapEx.

These and other non-IT sustaining capital investments are forecast to be approximately $18 million in 2023. Turning now to our funding, as you know Element maintains ready access to diversified sources of on balance sheet funding from a roster of high-quality lenders and investors across all of our markets.

And this is evidenced by our activity in the first half of the year. In April, we issued $750 million of asset-backed term notes, which was greeted by strong investor demand, allowing us to upsize the offering from $500 million while improving pricing.

In June, we upsize our credit facilities, as well as issuing a $750 million senior unsecured note at 200 basis points over the relevant treasury. We’re very pleased with this pricing for our third ever U.S.

bond yields and given the market at the time. With a strong outlook for originations over the next several quarters, we continue to evaluate funding options to optimize both our on and off balance sheet mix.

And of course, lower our cost of capital. This is an exciting time to be looking ahead at Element’s prospects because there’s so much positive momentum in our business.

A record profitability continues to validate our strategy and the organization’s cohesive approach to delivering that consistent superior client experience. Over time, this growing profitability, combined with recent and contemplated global tax legislation is likely to drive increasing cash tax expenses.

That said we expect cash taxes to remain below the accounting provision for tax that is a function of our effective tax rate. Before we take your questions, let me officially reaffirm the full year 2023 results guidance we provided the market in May, which remains unchanged.

We commit to revisiting this guidance since November as part of our Q3 earnings release. We also expect to be in a position to provide you with full year 2024 results guidance at that time.

For now, I’ll turn this call over to the operator for your questions.

Good morning. Frank, just first off a quick clarification on your commentary around free cash flow.

You said this quarter benefited by $0.04 from the pull forward. But I think you said that $0.04 will also benefit the second half.

Did I get that correct?

No, what I said John was had we not had that pull forward, that would have affected and I wouldn’t call the pull forward, it’s really driven by both the timing of the origination that we saw. So the strong originations and then also by the timing of cash taxes, which were lower in the quarter, had we not had those two impacts, we bet $0.04 would have likely benefited, would have benefited the second half instead of coming in in the second quarter.

Thanks, Frank, that makes a lot more sense to me. And then I guess my second question is, admittedly, this commentary came from at least two generations of management teams ago, but when we originally there had been some commentary around interest rates, and when, if I remember correctly, interest rate sensitivity for clients hit around 11% or 12%.

And we’re at that level now, at least, in general, are you seeing any rate sensitivity with your clients in terms of what you’re charging? Or is the environment just so different today, because of the impact we saw through the pandemic, that there’s basically no sensitivity?

I just – any commentary would be appreciate it.

Yes, and I think the way I would phrase this, are we seeing any impact on demand, right, in client demand, and we are not. And remember, it’s a aspect of the mission critical nature of these vehicles, the fact that the clients need to replace them, and the fact that the aging fleets because of the supply chain is helpful, but not in thriving, that it’s just the overall mission critical aspect of those vehicles.

And overall, all funding for our clients, when whenever markets and what forever, what are uses are up in this environment? So we’re in that same vein, obviously, up higher because our contracts are based on base rates at the time of the origination.

So no, we see demand is still very good. And I just point you to $2.1 billion worth of orders in the quarter, which was very, very strong from our perspective.

Thanks for the color, Frank. I will requeue.

Hi, good morning. Frank, I have a question on the syndication yield.

It’s varied a little bit at certain times over the past few years, just wondering how should we think about how the yield gets impacted by interest rates, the higher funding costs and tighter conditions for the regional banks and any other factors that we need to be aware of? And also, how are you expecting that yield to trend over the next couple of quarters or next few quarters?

Yes. So I think you will continue to – I will answer the last question first.

I think, you’ll continue to see yields kind of depress from that 2% level over the next two quarters, as we continue to be in this interest rate environment that we currently are in. That being said, what is driving that is twofold.

One is, obviously the increasing spreads that we’ve seen, but more importantly, the increasing hurdle rates at the banks, as they have gone through this year. So that impacts their ability to or the pricing of our products into their investment portfolios.

So that’s an important consideration from that perspective. That being said, I would say we continue to see significant depth in that market and feel very strongly as I commented in the prepared comments that we are on target for our guidance range, which would mean the second half will be stronger than the first half in regard to the syndication volume.

And that’s really benefiting from the supply we’re getting from the higher originations as we look there. Longer term, so going out past a quarter or two, we would anticipate that those yields would start to rise again.

In particular as interest rates, number one, stabilize and then number two, should interest – when interest rates start to come down, we will benefit in particular on our fixed rate product. So, historically, and I’ve said this before, we tended to sell more fixed rate and less floating rate in the current environment over the last year or so we actually sell slightly more floating rate than fixed rate, because it is much more agnostic to the volatility in interest rates.

That being said, it tends to, because floating rate notes do carry lower yields when sold.

Got it. That’s very helpful.

And just my second question on was when thinking about the reported backlog and what you think is maybe your shadow backlog? How long do you think it will take for all your clients to have their fleets fully call it up to date?

But in particular also is like how do you think that backlog normalizes in terms of what it means from the OEM side? In other words it’s – is it that increasing production allocations to fleets in terms of that shifting market share to fleet?

Is it adding an extra production shift? Is there a new plant opening, just trying to understand how you think about that path to normalization?

Yes. First and foremost, increased production, right, it’s always the best way towards it.

And I know the OEMs have been focused on increasing production and getting there. And obviously, they have done a significantly good job doing that in being able to originate the $2.6 billion that we had this quarter.

So, that’s been a very, very big plus to it. To us, the gravy is to the extent that there is any shift towards the fleets versus retail and that’s really a flat out how strong is retail demand for vehicles, because obviously, retail is an important component of their business as well.

So, we don’t count on that. But we do think we will see benefits should the retail demand slow down in any way, shape or form.

In regards to the backlog and when it normalizes, our crystal ball isn’t better than anyone else’s, but that being said, we think it will carry meaningfully into 2024. We think we will end the year with still a strong order backlog that is above normalized levels and we will take some time through 2024 assuming continued improvement in production as we move through the year.

And that also includes our perspective that orders will remain strong because of the demand that we see and the need for our clients to continue to replenish their fleets.

Okay, thank you.

Yes, thanks very much. Just a follow-up question with respect to free cash flow, even if I normalize for the $0.04 that you talked about, it still looks like free cash flow is up, maybe closer to 12%.

This is excluding currency adjustments versus your adjusted EPS that’s up 10. So we do have sort of free cash flow even ex the items you talked about growing faster than adjusted EPS are modestly faster.

Why might that be and what would be the outlook for that relationship as we move into 2024 just given some of the sustained CapEx investments that you have been talking about? And if you could shed a little bit of color with respect to that answer about recent discussions and to drive an increase in cash taxes and how you might think we should take that into account as well?

Thanks.

Yes. I think the first and foremost that I would point to, Tom, is that originations in general and even normalize it a little bit for that, they are very strong in the quarter.

And as we have said going on for the last couple of years, originations aren’t very good both from a revenue perspective, but from a free cash flow perspective. So, we really enjoy the improvement in originations and we know our clients enjoy the improvement in originations.

And so we are glad that, that is starting to come through from that component of it. As we look going forward, as I’ve said, we believe we will continue to have a material spread between our free cash flow, effective rate, free cash flow, cash tax rate and our effective tax rate.

So, you will continue to see a nice spread between those two and hence why we focus so much on free cash flow as we look overall at the business. And lastly, again, I point you in the future the strength of originations and just how strong cash flow drives from that regardless of the AOI component is an important component of why we see that differential.

And you talked about investing in your service model. Can you elaborate a little bit on that?

Are you looking at expanding your service proposition? Are you looking at – can you just shed a little bit more color with respect to what you are doing with your service model?

Sure. So, we have a very – we have a significant operating leverage in our business, but it is not absolute operating leverage, right.

So, when we see this level of originations, and as we grow clients, and as we increase our vehicles under management, there are certain aspects of the business, whether it’s FPS or maintenance service coordinators, or others that can service a set number of vehicles. And so as we grow the business, we need to invest in those areas.

And the reason that’s absolutely critical is, those are pieces of the business that directly face the client. And so if we want to continue to maintain high NPS scores, high retention rates, etcetera, we need to make sure that we are providing best-in-class service to those clients, which starts with our frontline people, which is absolutely critical from that perspective.

So, that is the service component. And then obviously, I have talked about investing in the commercial component as well.

And if you look, overall, a significant amount of our investment increase in OpEx over the quarter really is in our people. And our people drive our NPS, and they drive our client experience, and that’s why it’s so critical.

If I can just squeeze one more, what about orders, how do they – how are they trending relative to originations?

Yes, so we saw $2.1 billion in orders, which I believe is a record. And so they are trending very well.

Obviously, we had a very, very strong origination quarter, probably the high watermark for the year, but we will knock on wood, hopefully see strong originations going forward. So, we feel really good about the order volumes that we are seeing in the business and then the continued ability to originate against those watermarks.

Thanks.

Thank you. Good morning.

I want to go back to the OpEx investments you are making, I want to make sure I understand the story, right. So, two parts of the question.

I guess first off, Frank, I mean you just referenced NPS scores. I thought those were already strong.

So, just want to make it clear, are you making these investments for enhancing future revenue potential, or is it really just to bring up service levels that were maybe below where you are aiming for? And then two, maybe just remind us of your approach to managing investments versus revenue over time, i.e., margin/operating leverage?

And how you plan to manage that over time?

Yes. It’s a good question, Paul.

The answer to your first question is, right. So, we have to support the growth that we have, that’s absolutely critical.

But and we have to support the growth we were getting, at least at the levels that we currently have that provides us high net promoter scores. But additionally, in a world where you stand still, that is evolving as quickly as our worlds and our clients expectations continue to increase, we have to continue to invest to make sure that we are meeting those needs, and in fact, exceeding those expectations of our clients.

For two reasons, one is, it helps with our retention rates. Second is, it gets out in the market, and it provides our commercial team a very strong foundation to go sell on value.

And that is absolutely critical to our proposition as we move forward. So, that’s what you are seeing in this near-term.

I think longer term, you will see OpEx kind of moderate from the perspective of we will get to a scale and a level in regards to the commercial investment, that will start to level off. And remember, we are coming out of comparisons that are still pandemic or just coming out of pandemic, so that’s why you see some of those step ups on the commercial piece, whether it’s travel, meeting clients, etcetera.

But we will always focus and have always focused for the last 5 years on delivering that consistent superior client experience. And we are going to make sure that that’s something that we never – that we don’t put in jeopardy, while still maintaining our commitment to driving operating leverage over the longer term.

Okay. And then last question is just with respect to the syndication rates, and maybe it’s an obvious answer, but just assuming if they sort of stay in line with Q2, or below 2%, that means a lower proportion of syndication, versus what you retain on the balance sheet and maybe that has some influence on your 2023 guidance, is that fair?

There is no impact on our 2023 guidance. And what I would say, Paul is, when we look at a syndication, whether or not we syndicate a lease or group of leases, we always look first and foremost, is it a positive net economic benefit to syndicate that asset, right.

So, if it is a not a positive net economic benefit, and it’s better to hold on books and syndicates, absolutely we will hold it up, right. And so we are not going to give away economic value for the sake of just syndicating an asset.

That being said, because of our partners’ lower cost of capital and the tax benefits that we can’t use today, but our partners can use relatively quickly, many of our leases are beneficial to syndicate from an economic perspective. And so we are not seeing the current rate environment driving significant decisions around the volume.

We are going to syndicate and hence why we said our guidance for the year is good for syndication volume. And that as by definition, our second half will be more robust from a volume perspective than the first half of the business.

And I will point you to when we look at syndication and look at the P&L impact, it is relatively minor next to some of the other key drivers of the business service revenue, some of our NFR and what we are doing there. But that being said, it is critical, but I will go back to what I have said in the prepared remarks, which is it is a critical funding.

It’s for funding. It increases the velocity of cash flow, and allows us to go out and win more business and take on more vehicles under management, which carry with those service revenues, that and nerve to our benefit, as well as upfront originations whether or not and the benefits of those upfront originations whether or not we syndicate it.

So, I think hopefully that answers your question.

Yes. Sorry, I do want to follow-up, because I guess the way I am just looking at it is syndication rates are somewhat under pressure, at least they certainly were in Q2, and you are suggesting they will remain under pressure to some degree versus historical norms.

Yet, when we look at the net financial margin you are earning on what you keep on the balance sheet, it’s expanding and continues to expanding, and so I am just curious why that doesn’t change the equilibrium between retaining assets and syndicating assets? To me, I would have thought it, it would.

Yes. Again, it just – it goes to that net economic value, benefit and the equity, return on equity we get in regards to holding on balance sheet versus not holding on balance sheet.

And remember, when you are looking at it, I am not sure exactly what you are looking for in regards to yield. But if you are looking at the yield, there is a couple of things that influential.

The first one is the geographic perspective, right. So, we are growing assets outside of the U.S.

which carry higher yields to them. And those are enduring to our benefit from that perspective.

And then secondly, obviously, some of the non-interest component benefits like gain on sale continue to benefit us in regards to that as well.

Okay. I will leave it there.

Thank you.

Thanks.

Yes. There is some concern out there just the potential autoworkers strike looming in September.

How concerned are you or that that could sort of negatively impact production volumes, or would you at this point, expect that to be a bit more of a transitory type event?

Hey Graham, it’s Laura. I would tell you that we are watching it closely.

We have run different scenarios within the organization and all of its very manageable and be, let’s say similar to previous supply chain disruptions that we would have had. So, we would expect again, the fact would be, we continue to see a good order backlog would be elevated, and it would all be in deferred revenue.

And I would say more importantly, as Frank was talking about earlier, we don’t expect it to change our previously provided guidance. So, we are comfortable with our guidance for the balance of 2023.

And if it’s persistent to 2024, we think it’s all manageable.

Okay. Understood, maybe I can just jump to your the services piece, it looks to me like in the U.S.

and Canada, over 50% of your revenue roughly comes from services where it’s a much lower mix in ANZ and Mexico, because I guess why is it so much lower in those markets? And then do you feel like there is an opportunity to maybe replicate some of the services that you are offering in U.S.

and Canada to those other geographies and increase that mix?

Sure. So, I would say the number one is maturity, maturity of the market.

So, the U.S. market we have operated here, longer, we have got a much more built out service network.

We have got a much more consistent offering from just because of the size of the network, and for the length of time we have been doing it. It is absolutely one of the biggest focuses that we have from a growth opportunity perspective is to drive service revenues in Mexico and ANZ.

And we have seen considerable growth in those markets on our services business, albeit from a smaller base. As we build out those networks, and continue to add vehicles under management in those markets, we believe that represents a real opportunity to mature those services market and gain outsized growth within that service piece in those geographies.

So, yes, it is absolutely a focus, and absolutely an opportunity from our perspective.

That’s it for me. Thank you.

Yes. Thanks.

Good morning. Just wanted to go back to maybe read on your opening remarks, already you talked about some of the new client wins.

Still in market share in the self-managed fleet, it sounded like 20 or 25 new clients in each of the categories. Just wondering if you can frame like the revenue contribution of those clients and looking at the sub-path, it looks like via the services provided by these new clients in Q2 were a little bit lower than the broader average.

So, just curious, like how a typical new client starts with like, maybe a couple of services, and then you land and expand like, what’s the timeline or progression for that revenue kind of flow through?

Yes, thanks for the question, Jaeme. We usually start as Frank was responding to the earlier question.

So often, we will start from the leasing side, and then look at adding services over time, with services, of course, coming into revenue sooner as we take them in. But it’s really a question of progression over time, wants to get in and start providing service and we look to add additional services on.

And so dependent upon the service, it can take for products, can take three months to sometimes six months before we see those sales represent on the revenue side.

The other thing I would add Jaeme is what is really interesting about new business wins is just the tail on which it provides growth. And so when you think about the lease, we will typically – if they are already with another FMC, the FMC keeps those leases.

So, it takes 4 years roughly, 3.5 years to fully ramp up the full lease revenue. And that’s before any growth within the client’s fleet, which also adds to that increasing growth.

And then with the services piece, obviously, we typically don’t start out with the full suite of services, and so we have that ability to add share of wallet over time. So, the nice thing about the recurring revenue business is that it’s actually a recurring growing revenue business with the new client, because by definition, a win today not only provides value today, but if it provides value in year two, year three and year four as that growth takes place, and de-risks those future 6% to 8% growth rates we talked about.

Okay. Thanks And then, thinking about the gain on sale this quarter a little bit down from last quarter, are you able to – are you able to break out volume and price contributions?

I guess when we get like your volume is higher versus last quarter and it’s prices are coming down, of course, maybe a little bit of more color on how that gain on sale is progressing?

Sure. So, we have seen a little bit of pressure in ANZ in regards to pricing within the fleet, but we did see more volume and we also – which helped to offset it.

And we also saw higher vehicles that had more depreciation because of the age of the vehicles. And then we also have been growing our gain on sale in Mexico, which has been a benefit to us as we move forward with the with the business.

So, I think in general, it’s down a little, it’s relatively stable. We think that, it will decline over time, but at a very modest pace because of many of those offsets we talked about and the growth in Mexico relative to ANZ.

Okay. Good stuff.

Thank you.

Good morning. Thanks.

Just in terms of originations for 2023, you are at $4.4 billion for the first half to hit your guidance of, $8 billion to $8.5 billion. And even at the top of that range, you only have to do about $2 billion per quarter, so we assume that like this was a peak quarter in the year and perhaps originations do slowdown in the second half.

Yes. I would say that is a fair estimate.

And it’s very consistent with past experience where the second half tends to be a little bit lighter as the OEMs go through the model changeover in Q3, which they would have to take the lines down, retool, and then bring them back up to do that. I would tell you that, the high end of that guidance range is pretty sound from that perspective, but we will keep an eye on that.

And I think you heard the earlier question, earlier comments in regards to a potential UAW strike. And so we didn’t want to go out on a limb in regards to, how we think about the originations in the second half.

Okay. That’s good.

One more, so can you just talk a little bit more on the self-managed conversion? I know Jaeme just asked the question, but I presume that near the tail end, and also some of these contracts take a long time to come to fruition.

But you must have been or could have been part of some of these conversations with these new clients. Maybe you could just talk about what you saw through those discussions, what got those fleets to convert, was it pricing, or was it the additional promise of services, or what in your view, made those companies or governments or regions convert to Element?

Thanks for the question, Stephen. I just want to start with our people.

I have had the opportunity to actually go on some of the sales calls and spend time with the team. And we have a very high quality sales team and account management team that builds really strong relationships, and they create trust from our prospective client base.

So, that goes a long way. We have great people and a really solid value proposition.

So, not only in what we offer in terms of total cost of operation where we can help our clients save money. I would say a real differentiator is the strategic consulting value that we bring forward.

Again, solid teams that offer really impressive insights to our clients where they can take action and save costs by following the advice that was given. All that said, it is a longer sales cycle just given it does take a few meetings, again, to gain trust and get our prospective clients comfortable with entrusting us with these operations.

But once our clients do sign on, as you saw with our retention rates, we do a great job of keeping them. And as Frank alluded to earlier, we have got some really solid momentum in the business.

And with a lot of these winds, this should carry us from a growth perspective in the future years.

Okay. Just when you mentioned strategic consulting that’s not just for EV, that’s just for the whole product offering?

That’s right, offering including EV.

Okay. Thanks very much.