Elizabeth Anderson : I was wondering if you could comment a little bit more on the payroll investments that you talked about in the U.S. Is that still sort of tracking towards the $525 million that you guys guided to initially? And is there any kind of reaction to some of the other retailers have moved up to $18 now. I just wanted to see if that was something that was helpful. And then secondly, can you talk about what the main drivers Summit EBITDA as you think about the back half of the year?
Rosalind Brewer : I’ll start off with your question on labor. So we’ve continued to make progress. A lot of our labor investments came in, in the form of two areas. And so as a reminder, we did go to $15 an hour, and that’s spreading out over a period of time at our hourly rate. And then we also made the investment to regaining the pharmacy talent in our stores. And it’s working for us. Right now, we don’t see any advanced needs in that area to move on labor any further. A couple of things that we’ve learned in this process is we’re closing the shortage by adjusting our pay practices and it’s allowing us to return some of our operating hours in there. So what I would say to you is that we’re steady in this position and don’t have plans to take any further increases in that area.
James Kehoe : And then you had a question then on Summit. I think we don’t want to get into specific guidance on any of the individual units. But what I’d say is we’re looking forward to strong performance out of Summit in the back half. A couple of items as you consider it is, one is we have four new businesses that were not fully in the base. So they’ve got coming on stream. They had two acquisitions back at the end of fiscal ’21, NJU and Westmed. And these two — they’re basically in the process of squeezing out the revenue and the cost synergies on these two acquisitions. Very exciting as well. They opened a lab — a new lab at the end of ’22, and this lab is the biggest private lab in the U.S. So this is going to be huge and a big driver of growth in the second half.
And then the final one, they just closed on an acquisition called Starling, which is quite sizable practice, multi-specialty and will contribute heavily to both revenue and EBITDA growth in the second half. The only item we saw with the acquisition has been — and we saw it on our front of store business as well. As we look at the first quarter, the only real negative we saw was in January, where we saw a much lower incidence of virus cases. And this impacted our OTC business in front of store in the U.S. And we saw a slowdown in CityMD traffic. So that was the only item of any kind of note on the negative side on the Summit. And overall, the Summit multi-specialty business and the primary care physician business is doing really, really well.
And we’re very confident in the outlook for the second half. John, I don’t know if you have any?
John Driscoll : I think you took all the revenue and profit drivers, in good shape.
Operator: Your next question comes from the line of Charles Rhyee from TD Cowen.
Charles Rhyee : Yes. Maybe I know there’s been a lot of recent discussions on the impact of changes in Medicare around the scoring, coding of CMS moves to ICD-10 from ICD-9. Have you guys done an analysis here at the VillageMD and Summit in regards to this? Because I know that on a relative basis, the states like Florida have the most risk. And so maybe can you remind us what your geographic mix locations generally? And what percent of VillageMD Summit’s mix is Medicare?
