Operator: Our next question comes from the line of Jack Wallace with Guggenheim Securities.
Jack Wallace: Yeah, thanks for taking my questions and congrats on a great start to the year. A couple of questions. One, it sounds like the tuck-in strategy has been working really well and maybe paying off some dividends this quarter. Can you talk about just any of these synergies, just prior tuck-in deals, particularly in the areas or geographies where you’ve got incremental density related to those deals? And how much were those synergies powering over performance in the quarter?
Jon Rousseau: There really wasn’t an impact from prior deals in the quarter. It was almost all entirely organic Jack. We really were focusing on the IPO in the back half of the year and that’s where the slowdown in M&A occurred last year as we were moving towards the IPO. And so this was very much largely an organic quarter. But you’re right that synergies very much come into play. Our scale, our operational capability, our sales and marketing capability, and then just our contracting and our purchasing capabilities in the organization, those all drive immediate synergies and transactions. They usually cut our multiple in half very quickly when we do deals. We would expect a healthy flow of smaller tuck-ins for this year, obviously, just given our focus on execution after the IPO operationally and given our focus on cash flow.
For the first part of this year and into Q3, I think we’re certainly going to be focused on smaller tuck-ins and trying to drive things that are very accretive and even deleveraging and in the acquisitions that we do. So — but really no contribution from prior M&A in the first quarter. And — but our pipeline has consistently remained as strong as it’s ever been. And we are under definitive with several more deals here that should be closing in the near future. Again, they will be of the smaller tuck-in variety at attractive multiples.
Jack Wallace: Got it. That’s helpful. And then it sounds like there was some good over performance in the provider segment driven by your ability to contract away some of the potential headwinds from reimbursement. Is there further upside to go there this year or is there maybe any — an outsized benefit seen in the first quarter that maybe won’t repeat going forward, any color there would be helpful? Thank you.
Jon Rousseau: Yes. Thanks, Jack. Look, I think it’s a great example of the balance in the organization as well. Provider did perform really well in the quarter from a year-over-year perspective and really on the margin side. I think as we look out for the rest of the year, as I’ve said, the margin for the company outside of specialty and the specialty mix impact with their outsized growth, the margin for the rest of the company grew year-over-year. We expect the margin for the company to — on the other side of the calendar turning on 1/1 and after Q1, we expect the margin for the rest of the company and the company in entirety to continue to grow through the balance of the year. And that is the case on the provider side as well.
We see that margin continuing to creep up. There are several drivers there, continuing to drive volume growth and leveraging our fixed cost and our OPEX. We are going to get some positive rate there, particularly around hospice in the later part of the year in Q4. And then we have numerous other operational initiatives in place that are going to continue to be driving EBITDA as we go throughout the year. So we do expect some tick up and some modest improvements even on the provider margin side through the balance of the year.
Operator: Our next question comes from the line of Pito Chickering with Deutsche Bank.
Kieran Ryan: Hi there, this is Kieran Ryan on for Pito. Thanks for taking the questions. Just wanted to go back to the Specialty and Infusion margins one more time. Is this about — since the guidance raise is mostly driven by that segment, is this about the level of EBITDA flow-through that we should assume on revenue upside for this segment going forward or is there anything you’d call out that is maybe kind of dragging the incremental margins down this time, just trying to kind of square the incremental margins on the guidance increase with the kind of the historical trends? Thank you.
Jon Rousseau: Yes. No, our guide on the provider side is going to go up as well, Pito. So we feel really good about that business, and we’ve taken our expectations up for the year as well on the provider side. So really, it was an enhancement on both the pharmacy and provider side for the company. I think as it relates to margin, it’s — the vast majority of it is all due to the outside specialty growth and mix. Again, the rest of the company grew on margin outside of that volume growth in specialty. And there was a little bit of mix impact in the business. There was some insulin pricing change in the industry that occurred at the beginning of the year. We did note a relatively modest impact from change in the quarter, which will go away into Q2, although I think we handled the change situation really phenomenally as a company as an indicator of our operational performance.
So as we look out to the rest of the year, the provider side guide was raised too. We see that margin ticking up. We see the margin for the whole company ticking up over the rest of the year. And it really is a function of just tremendous growth in the specialty pharmacy side of our business. And — which, again, is a real positive from a revenue and an EBITDA dollars perspective. And margins for the company in total are extremely healthy, and we feel really good about where they’re going to be headed here over the next 12 months.
Kieran Ryan: Thanks a lot.
Operator: That concludes today’s question-and-answer session. I’d like to turn the call back to Jon Rousseau for closing remarks.
Jon Rousseau: Thank you, operator and thanks all of you for joining us today on the call. Over the course of the next couple of months, we’re going to be participating in several investor conferences. We wanted to let you know as well, and we look forward to speaking with you there in the future and on the second quarter call in a few months. Thanks for joining today, and have a great one. Bye.
Operator: This concludes today’s conference. Thank you for participating. You may now disconnect.
