Kevin Steinke: Good, good. Well, I wanted to follow up on one of Marc’s questions there. You talked about the slowdown and conversions, and originations — the conversion ratio and originations in the third quarter as being broad based was the pickup in the conversion ratio and project originations also broad based as you saw in the fourth quarter?
Paul Maleh: Yes. it was, it was. and again, the — seeing the broad-based drop and rise across the portfolio adds to a little bit of my confidence that I shared earlier in the year that I don’t think these drops are the result of us losing market share. I think they’re just broader market volatility factors impacting us.
Kevin Steinke: Okay. And so I don’t know if you — is your team is out in the field and interacting with clients, if there are any themes or reasons that might have led to the improvement, the conversion ratio and the number of originations. I know you had kind of pinned it on macroeconomic uncertainty. Do you have a sense that the client base is just getting a little more comfortable with the economic outlook or any other factors you might attribute the improvement to?
Paul Maleh: Yes. we’ve all seen some reduction. How about, in my most negative light, I can put on it towards the — throughout ’23, we saw a reduction in the uncertainty in our macroenvironment. I think people are feeling a little better as the direction of inflation. People are feeling a little better with respect to overall interest rates for borrowing. So, that has helped reduce some of the uncertainty. I can’t speak whether everyone is feeling more comfortable releasing discretionary dollars for services or not. but the fact that we see signs of life in the M&A market, I think are going to this overall reduction of uncertainty and maybe better times ahead.
Kevin Steinke: Okay. That’s helpful. And so as we think about the 2024 guidance that you provided, what are you assuming for the lead flow conversion ratio and also consultant utilization? Are you essentially assuming that both conversion and utilization are back to kind of normalized levels?
Paul Maleh: So, in my best non-answer to you, Kevin, it really depends on what part of the range you’re going to focus on. Clearly, as we get to the upper half of the range, I am assuming more of a return to normal operations that are consistent with years past on that. So, our goal is always to try to operate this firm in mid-70’s utilization. I think that produces capacity for innovation. It could — produces capacity for profitable growth to adequately return capital to shareholders and reward my colleagues for it. So, that hasn’t changed for it. You’re always going to have volatility quarter to quarter on utilization. It’s just a way of life particularly with the holidays and as a new people come aboard with that. But medium long-term, we’re still at the mid-70’s utilization target.
Kevin Steinke: Okay. Yep. Understood. and so what did — what sort of trends have you been seeing lately in terms of attrition among the junior consultant ranks? Is that still significantly below normal levels or has there been any meaningful change there?
Paul Maleh: Yes. I got corrected by one of my colleagues when talking about this subject matter. And I was told that attrition is a very negative way to look at it. We’re having — we’re enjoying really strong retention across the board. I’m pleased with that. I’m sure there are factors in the environment that we’re creating. But I also realize that the uncertainty in the broader market is impacting the ability of people to move from one occupation to another. But we’re going to take advantage of that, right at 73% utilization near record performance across the board in Q4. We needed all of those heads. We haven’t seen any kind of dramatic shift one way or another in our retention rate. Q1 into Q2 is sometimes telling as we get through bonus cycle and as we approach summer of whether we’re going to start seeing retention rates approach more historical standards.
Kevin Steinke: Okay, great. And then just in terms of lead flow, you mentioned it continued to be strong in the fourth quarter. I don’t know if — did you have a growth rate for the lead flow, I think you’ve talked about that the least — last few quarters, but I didn’t know if you had a specific number you could share.
Daniel Mahoney: It’s a good question. What I’m going to do is, I should have that in front of me, Kevin. I don’t. what I’ll try to do is, I’ll try to find it and next communication on one of our investor days, I will share that information. but I do not have it readily available.
Kevin Steinke: Okay. No problem. Well, thanks for taking the questions and congratulations on the strong results. I’ll turn it back over.
Paul Maleh: Great. Thank you.
Operator: We have reached the end of the question-and-answer session. I would now like to turn the call back over to Paul Maleh for closing comments.
