Stephen MacLeod: Great. Thank you. Good morning, guys. Just wanted to circle around on a couple of things related to Q1, particularly within restoration. I know you gave some sort of near-term guidance on the different components. But just wondering, when you put it all together, what — how do you sort of foresee Q1 organic growth evolving on a consolidated basis within the brand — it was in the brands division?
Scott Patterson: Jeremy, do you want to handle that?
Jeremy Rakusin: Sure. I think it’s going to be pretty similar, Stephen, to what we what we just saw in Q4. Similar headwinds in the order of $80 million. I think I mentioned in my prepared comments, $80 million that we’re going to be comping against in Q1 versus Q1 of 2023. And that’s a similar headwind as what we had just in Q4. So organic revenue growth, as Scott mentioned, was down 7%. It’s going to be down about the same amount, including the storms, if you ex out this that $80 million headwind would be healthy organic growth for the Brands division.
Stephen MacLeod: Okay. Great. And then just would you expect a similar type of margin impact in Q1 that you saw in Q4, considering the organic is roughly the same?
Jeremy Rakusin: On a consolidated — I’ve said that residential will be flat and brands would be down on a consolidated basis. I would look for Q1 consolidated margins to be down roughly 100 basis points, perhaps a little bit more.
Stephen MacLeod: Okay. And that would be sort of flat resi and down brands to get to that consolidated.
Jeremy Rakusin: Obviously, brand’s down more than $100 million, if the other division is flat, but the consolidated would be 100 basis points of potential wider on the compression.
Stephen MacLeod: Yes. Okay. No, that’s very helpful. And then just sort of higher level, having now owned the Roofing business for six weeks or however long it’s been. Just wondering if you can give a little bit of color as to kind of what you’re seeing so far? I know you mentioned the business finished the year strongly, which is great. But just wondering, are there some wins or highlights that you can sort of highlight that you’ve seen so far?
Scott Patterson: Yes. I mean it’s early days, Stephen, thinking through the wind. I think the biggest thing from our perspective is just our excitement to be partnering with this group. It’s a strong team, and we’re just filled with optimism about our opportunity in this business. We’ve got great operators at the branch level that — and generally, the alignment with the management team around building the premier roofing contractor in the U.S. and doing it the right way. Ensuring that we’re serving the customer, winning day-to-day and growing organically and then topping that off with acquisitions, and we do expect to be participating. It’s a consolidating industry. And we’ll definitely — I expect that we’ll do some — we’ll have some success completing tuck-unders this year.
Stephen MacLeod: Okay. That’s great. And then maybe just sort of higher level, just as we think about the year for 2024. Looking at — it looks like the comps are a bit tougher in both brands and resi in the first half of the year. So are you kind of expecting the year to shape out that way with sort of tougher comps in Q — in the first half and then maybe some stronger growth in the back half of the year?
Jeremy Rakusin: Not so much. And I think Scott spoke about it in residential, if you’re talking top line, we’re going to settle more into a mid-single digit organic top line growth pattern. Brands for sure, the headwinds are most acute in the front half of the year, particularly Q1, a little less so in Q2, but still there with respect to the hurricane-related and winter storm Elliott-related work that we had. It starts to paper off in Q3. And as you know, it was pretty minimal for us in Q4 this year. So yes, the wins will fade as we move through the year.
Stephen MacLeod: Okay. That’s great. Well, thanks, guys. Appreciate it.
Operator: Thank you. And one moment for our next question. And our next question comes from Daryl Young from Stifel. Your line is now open.
Daryl Young: Hey. Good morning, everyone. Just sticking on the roofing theme, a question around the growth focus. And I guess how the organic model is going to work there and what are some of the key variables are for winning market share. So is it about competing on price? Or is there a way to pursue a differentiation strategy in terms of large scale or more complex roofing projects or specialty facilities or any color you can give here on what differentiates the growth.
Scott Patterson: I think, first and foremost, it’s a growing market. So there are tailwinds that will drive the growth in the market. And then it comes down to serving the customer in the local market and having great leadership locally, great relationships and delivering on your brand promise. And so this is a group that has done that historically. And one of the reasons why we’re so excited about partnering with them is that kind of alignment. So it’s going to be — the markets are huge, and it’s very similar to our other markets and the opportunity to grow organically is really through your culture, your people and bringing it every day. And that’s the same as all our businesses. And really, that’s the opportunity that we saw.
We’ll be taking a long-term perspective. It’s incremental. And then it is early days, but there is an opportunity as we fill out our footprint to start to develop a national account program similar to what we’ve done at FirstOnSite Century Fire. And we’ll be working on that in earnest in the coming years.
