Shlomo Rosenbaum: What about the expense items, though? That’s part of, like, the question. I see a lot of some of this you’re discussing the revenue, but where there’s some expense items, it seems like we’re moving back. Timing of some of them, can you just discuss what exactly that meant?
Andrew Krasner: Yes, nothing of note. It was primarily the expanded growth in the top line that was really flowing through to the margin is what you’re seeing.
Shlomo Rosenbaum: Okay. Thank you.
Andrew Krasner: Thanks.
Operator: Thank you. Our next question or comment comes from the line of David Motemaden from Evercore ISI. Mr. Motemaden, your line is now open.
David Motemaden: Thanks. Good morning. I just had a question on the R&B segment organic growth. I’m wondering if you could just size the contribution to organic growth from the new hires or the ramp-up of the hiring that you guys have done over the last several years. And also just wondering, I think we’re 9 to twelve months into the ramp-up period. So if we kind of pass the peak incremental contribution of the new hires. And so we’ll just continue to get contribution going forward, incremental contribution going forward. Would it’ll just be at lower levels or am I not thinking about that right?
Andrew Krasner: Yes. So, we’re not going to get into these specific contributions of recent hires. But to your latter point, we’re 12 to 18 months in if you think about for the first cohort of folks that we had hired. And those are at or near expected production levels. However we did hire after that first round of hiring as well, it’s been a continuous process. So we do expect increasing contributions from enhanced productivity from those hires as time progresses. So we do think there’s more room to run there.
David Motemaden: Got it. But the big cohort I guess is fully ramped is what it sounds like. Is that correct?
Andrew Krasner: The hiring process was a bit more continuous than that. So there’s not just one big lump of people. All hired in the same quarter. It was a more gradual build-up. I think you may be sort of the way you’re phrasing it. So I think we still and as we said, in terms of or re-productivity from the group as a whole.
David Motemaden: Got it. Understood. And then just my follow-up. So I heard the commentary on the individual marketplace driving the health, wealth, career, organic and the 14 and in BDO, was TRANZACT was a driver there. It didn’t look like that had adverse of an impact to free cash flow as I would have thought. So, was there anything you did in the quarter to help minimize that impact? Or was it just too small of a revenue contribution number given what you said about it being a small base that it just didn’t really have an impact on free cash flow in the quarter?
Andrew Krasner: Yes. I think two things there. One, it is relatively small contributor in that quarter overall. The second thing I’d say is, one of our key focus areas has been to work to improve the free cash flow dynamics around TRANZACT, and that includes balancing our Medicare Advantage portfolio with the mix of products that have different or better free cash flow conversion profiles, things like life insurance policies. So we are reorienting the portfolio a bit has helped enhance that profile of that business, and that’s one of the steps that we’re taking to get that business to be free cash flow positive over the next few years.
Operator: Thank you. Our next question or comment comes from a line of Yaron Kinar from Jeffries. Mr. Kinar, your line is now open.
Yaron Kinar: Thank you. Good morning. Follow-up question on one of the comments you made on maybe curtailing T&E expenses and vendor spend. How do you – obviously, one of the challenges you have as managers is balancing between organic growth margin improvement and free cash flows. Ultimately pushing that lever I would think could impact organic growth to some extent. So how do you think about the two and the impact you would have on organic?
Andrew Krasner: Yes, good question. And the answer is, yes, we are balancing between things. But there are places with better just simply to be easier to cover others, right. Internal travel isn’t directly tied to client revenue going to see clients. So we’ve just asked people to be smart about how they spend their travel dollar. And just being a bit better organized can help tailoring several client visits together perhaps combined if you’re a senior management with an office visit can be a far more productive spent. And I’m really pleased how our team has responded to the call for better discipline in this room.
Yaron Kinar: That makes sense. Thank you. And then going back to the appetite for the reinsurance business or getting back into that business, I think one of the challenges that we’ve looked at from the outside is just scalability and also the absence of any very large assets that you could pursue inorganically. So assuming that it is something that you’d want to pursue, ultimately does that have an impact on the business over the next few years? Or is it really going to be in build-out mode for a very long time before we actually see more substantial results?
Andrew Krasner: Yes. If there’s something that we decide to act upon, we would expect to do so in a very thoughtful manner, recognizing the obligations and commitments that we’ve made. And we’ll do so in a very disciplined fashion. And we recognize the what the inorganic options look like and have to balance that from a strategic perspective with what an organic build might look like and the timescale for that. We just got to be disciplined and thoughtful about how we approach that if that is something that we decide to act on in the future.
Operator: Thank you. Our next question or comment comes from the line of Michael Ward from Citi. Mr. Ward, your line is now open.
Michael Ward: Thanks guys. Good morning.
Andrew Krasner: Would you start the question, Michael?
Michael Ward: Yes, sorry about that. I was just wondering if you could maybe unpack the sources of organic growth acceleration in CRB, which global lines you see is driving organic growth the most over the next 12 months?
