Rick Stanford: Thank you.
Operator: Our next question comes from Peter Heckmann with D.A. Davidson. Please go ahead.
Peter Heckmann: Good morning everyone. Thanks for taking the questions and congratulations on the Celtic deal. I wanted to ask guys, so with Celtic where are they in their progression from a license model to software-as-a-service? And with some of those things you were talking about in terms of permitting, driver history records, is transaction revenue a part of it or is it primarily software?
Greg Daily: Pete, I’ll start on that. Celtic does have around a 50% margin, and so that is part of what you see in our guidance for 2023. They are not currently a SaaS model. Maybe 40% of their revenues are recurring in some form or fashion, but they really haven’t begun to design a SaaS offering. But we will begin to do that now, but it’s baby steps right now. What was your second question?
Peter Heckmann: So it sounds like there’s no — there would be really no transaction-based revenue in terms of…
Greg Daily: No. Yes. No, I have currently have none, but again, we plan to try to introduce that particularly on new business.
Peter Heckmann: Got it, got it. And as a follow-up, Celtic looks like — I think in the press release, you said, four Canadian provinces but it looks like a couple of those they won a number of years ago, so fairly established in Canada. How do you think about Canada expanding the TAM for your Public Sector business, is there a way to think about that?
Greg Daily: Well, it’s exciting for us. We currently have several Canadian customers. The contracts are denominated in U.S. dollars. So the FX won’t be very challenging for us. But yes, the whole new TAM, as you put it to explore and expand and add payments to, and we’re very excited about that.
Peter Heckmann: Great, I appreciate it. I will get back in the queue.
Operator: Our next question comes from James Faucette with Morgan Stanley. Please go ahead.
James Faucette: Great. Thank you very much. First, your 2023 margin guide, I think implies around 150 basis points of year-over-year expansion. We’ve seen some margin pressures crop up in other, both competitors and comparables. How are you thinking about the puts and takes around your margins and where you’re targeting for fiscal year 2023?
Greg Daily: Well, Celtic adds about as almost as much as 100 basis points, just layering it in and at 50%. Corporate should contribute 50 basis points, it contributed 40 basis points this year in a challenging inflationary environment. T&E and trade shows have been a pretty big deal this year in fiscal 2022. That was $3 million higher than in 2021 as normal travel and in-person sales activities resumed, trade shows started taking place again. So we don’t have that drag coming in 2023. Now there is general inflation so, we’re not promising 150, but we have a pretty clear sight to margin improvement in 2023.
James Faucette: Got it, got it. And then on the M&A front, you indicated that Celtic was kind of within your historical range of valuations that you paid. Given the environment and kind of your pipeline of deals, what’s the opportunity for you to even find things that you can do at better valuations than you’ve done historically? And just wondering how we should think about that as a potential, especially given the overall environment right now?
