Mary Meixelsperger: Yes. So Mike, on — as you’re thinking about modeling, I would say — we had an extraordinarily strong Q1 last year. So if you looked at last year, the seasonality was 45% front half, 55% back half. This year, we’re more in the 40 — low 40% front half and high 50% back half, with a little bit more weighting towards the back half of this year. And I agree with Sam, we typically don’t point you anywhere within the range from a guidance perspective. We still believe that, that’s a very good range.
Mike Harrison: All right. That’s very helpful. And then I wanted to look at the SG&A costs. Obviously, a pretty big step-up there year-on-year. You mentioned that maybe there were some additional like sales kickoff meetings or, I guess, maybe things that were in person this year that were virtual in the prior year. But maybe talk also about what you guys are seeing in terms of advertising costs or corporate costs. And I guess we’re just trying to get a better sense of where that SG&A expense number should be for the rest of the year.
Mary Meixelsperger: Yes. So you’re right, Mike. We do have our both company and franchise meetings occur in the first quarter of each fiscal year, and we saw that again this year. This is the second-year post-COVID that we’ve done those meetings in person. But because of the number of stores increasing and our need to continue to develop a pipeline of talent to feed future growth, the attendance at those meetings has grown pretty significantly. So the overall cost of those meetings did drive an increase in the SG&A year-over-year, about a third of the SG&A increases relates to direct advertising that is in support of the increased unit count. And we’re seeing and measuring very strong return on that investment driving growth in new customers, as well as retention of existing customers, and I feel really good about that advertising investment.
And then finally, we’ve also made some investments in people as we continue to drive growth in the model. And we’ve had some indirect cost increase, as well just in relationship to the separation and the fact that we’re seeing a little bit higher indirect expense as a percentage of sales as a result of some deleverage that we’ve seen as a part of the separation. So I would tell you that it’s very much a big focus for us to ensure that we have the right balance of SG&A investment relative to growth and efficiency, and we’ll be spending more time just making certain that we’re being as efficient as possible, while not still being able to ensure that we’re investing appropriately to meet our growth targets.
Mike Harrison: Alright, very helpful. Thanks very much.
Operator: Our next question comes from Laurence Alexander from Jefferies. Laurence, please go ahead. Your line is open.
Dan Rizzo: Good morning, everyone. It’s Dan Rizzo on for Laurence. Thank you for taking my call or my question. So I think you mentioned having a target of 55% franchisees and the rest store owned in your, I think, your long-term target? But it seems that you’re opening more company-owned stores. I was just wondering when we can expect the mix to shift and what will kind of change it or how we should expect that to kind of play out?
Lori Flees: I do. If you look at Q1 ’22, we had a franchise mix of 55%. And given the pace of our builds and our acquisitions on the company side over the last 15-months, the mix has dropped to 53%. And I think the question is valid. We are working with our franchise partners in both looking at existing development agreements, as well as incentives around new units. And how we bring in new franchise partners. Those activities will take time, and I think we talked about accelerating the franchise new unit growth to 150 units. But that would take us some time. I think FY €˜27 is when we would project to get there, though we are working hard to accelerate that even further. So if you just look at adding 100 stores on the company side, which we won’t get to this year, but we’ll move to 100 additional stores on the company side and then accelerate franchise, you can see when the math flips to getting us back to 55%, but it happens later in the five-year forecast.
Dan Rizzo: Okay. And does a recession — I would think so. But does the recession kind of make it that much harder to attract new franchisees or historically speaking, has it not been that much of a factor.
Sam Mitchell: Yes. We’re — some of the discussions that we’re having with potential new franchisees have been very positive. And so the strength of the model, the fact that it’s a strong cash-generating model and the competitive advantages that our model has is really a strong draw. And so as Lori described in our goal to increase our franchise growth, we’re seeing — we’re having some very good conversations, productive conversations with our existing franchisees. And again, we focus on well-capitalized professionally managed franchisees to partner with us to deliver that great customer service. We expect stronger growth from our existing franchisees, but then also bringing in a handful of new partners and we see some opportunities to do that, and it’s just going to take a little bit of time to make that happen. But as it happens, we do expect to see that franchise growth to accelerate.
Lori Flees: I’ll just add, Sam, to your point, there are over 4,000 at least that we no independent Quick Lube operators and we’re having active dialogue with between 50 and 100 of them every year. And what I would say is through COVID and the war for talent and the increased in inflation, we’re finding that many of the independent operators are looking for help to drive the kind of performance that they may have seen previous to COVID. And so the conversations that we’re having are accelerating whether they want to be a franchisee and what help would that provide, but also is now the time for them to sell their business. And either remain a part of it and/or they exit completely. And so we’re seeing that the inflationary pressures are changing the game for the independent Quick Lube operators and that will help us both on the acquisition front, but also on the franchise recruitment front.
Dan Rizzo: Thank you, very much.
Operator: The next question is from Chris Shaw from Monness, Crespi & Hardt. Chris, your line is open. Please go ahead.
Chris Shaw: Yes, good morning, everyone. How are you doing?
Sam Mitchell: Good morning, Chris.
