Nick Zarcone: We believe absolutely. The reality is we posted up 5.8% on a same-day basis in the third quarter. Again, as I just mentioned in answering Bret’s question, that’s coming from better APU, it’s coming from taking share from some of the smaller competitors. Our guess is that North America will probably have some similar growth in the fourth quarter as in the third quarter. On the one hand, obviously, the comps get harder, right, because last – Q4 of last year, we were starting to get back to our fulfillment rates into the low 90% range in the fourth quarter. Wherein earlier in the 2022, we’re still well down in the 80s. So the comps were easier at the beginning of the year than they are going to be here at the end of the year.
And on the other hand, though, we’ve got the benefits associated with State Farm and some of the benefits related to the UAW strike. And there’s no doubt that the UAW strike helps our North American business. On a long-term basis, we absolutely are confident in all the expectations we set, including those back in our Analyst Day in 2022. And what we think a couple of percentage points of growth, excluding inflation, is absolutely within our capability.
Daniel Imbro: That’s helpful. And then maybe just a follow-up. Rick, so you mentioned in your scripts that buybacks are part of capital deployment. But it does feel like you guys have done more M&A, whether it’s a small one in Canada, you just bought Uni-Select. Can you maybe talk about like what just the strategic rationale is at buying at this point in the cycle? Could you – do you typically get better prices if we do enter a downturn? And just, I guess, how you plan on spending the $1 billion of free cash? You have $150 million of debt pay down of work to do, but what do you plan to do with the rest of it?
Rick Galloway: Yes. It’s good question, Daniel. Thanks for as you start thinking about the overall capital allocation strategy, that hasn’t changed. So if you think about it on an ongoing basis, $1 billion, we have $300 million roughly for dividend. We obviously raised the dividend 9% based off of what the Board has approved and the solid cash performance that we have. Then we earmark about, call it, $200 million annually for tuck-in acquisitions. And then the remainder, about $500 million to do kind of what we want with it, right, whether we do share repurchases, whether we do some debt pay down. What we’ve said is we’d be over weighted – until we get below two times, we’ll be over weighted on that remaining $500 million on debt paydown.
So that’s going to continue. But we constantly are looking at our opportunities, whether there is an opportunity on the share price, if there’s some timing that offers us, we’ll continually look at that. But what we’re committed to is, within 18 months, we’ll get down below that two times. And so that’s something that’s weighing in the back of our mind. So that’s the way you should think about that capital allocation.
Daniel Imbro: Great. Thanks so much.
Rick Galloway: Yes. Thank you.
Operator: There are no further questions at this time. I’d like to turn back the call to Nick Zarcone. Thank you.
Nick Zarcone: Well, certainly, we want to thank everybody for your time and attention this morning. We know this is a busy reporting period, and we certainly appreciate spending some of your time here with LKQ. We obviously look forward to chatting with you again in February – late February of 2024 when we’re going to announce our fourth quarter results, full year 2023 results. And obviously, we’ll set the guidance for next year with all of you. So again, thank you for your time and attention, and we’ll be talking in February.
Operator: This concludes today’s conference call. You may now disconnect.
