Good afternoon, and welcome to Arthur J. Gallagher & Co.'s Q4 2023 earnings conference call. Participants have been placed on the listen-only mode. Your lines will be open for questions following the presentation. Today's call is being recorded. If you have any objections, you may disconnect at this time. Some of the comments made during this conference call, including answers given in response to questions, may constitute forward-looking statements within the meaning of the securities laws. The Company does not assume any obligation to update information or forward-looking statements provided on this call. These forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially. Please refer to the Information concerning Forward-looking Statements and Risk Factors sections contained in the Company's most recent 10-K, 10-Q, and 8-K filings for more details on such risks and uncertainties. In addition, for reconciliations of the non-GAAP measures discussed on this call, as well as other information regarding these measures, please refer to the earnings release and other materials in the Investor Relations section of the Company's website. It is now my pleasure to introduce J. Patrick Gallagher, Jr., Chairman and CEO of Arthur J. Gallagher & Co. Mr. Gallagher, you may begin. Thank you very much, and good afternoon, everyone. Thank you for joining us for our Q4 2023 earnings call. On the call with me today is Doug Howell, our CFO, as well as the heads of our operating divisions. We had a strong fourth quarter to wrap up another fantastic year. All measures were right in line with what we said during our December IR day. For our combined brokerage and risk management segments, we posted 20% growth in revenue, headline 8.1% organic growth, but that's more like 9.4%, controlling for the 606 accounting and large life case timing. We also had a terrific merger and acquisition quarter. We completed 14 mergers, totaling $410 million of estimated annualized revenue. GAAP earnings per share of $0.30 and net earnings margin of 2.8% were impacted by the counterintuitive earn-out payable accounting that Doug will elaborate on in a few minutes. So better to look at it more on a comparable basis. Adjusted earnings per share were $2.22, up 23% year-over-year, and we posted an EBITAC margin of 30.1%, up 69 basis points over Q4 2022. What a terrific quarter to close out an incredibly good year by the team! When I think about our growth for the full year, we are up 18% in revenue. That's an increase of $1.5 billion. That's amazing. Moving to results on a segment basis, starting with the brokerage segment. Reported revenue growth was 20%. Organic headline was 7.2%, but I see it more like 8.7% without the accounting and timing noise, and 11% if you include interest income. Adjusted EBITAC was $647 million, growing 21% year-over-year, and we posted adjusted EBITAC margin expansion of 48 basis points. Let me give you some insights behind our brokerage segment organic, and just to level set, the following does not include investment interest income. Our global retail P&C brokerage operations posted organic of 8%. This includes about 8% organic in the U.S., 8% in the U.K., 5% in Canada, 10% in Australia and New Zealand. Our employee benefit brokerage and consulting business posted organic of 2% or 6%, controlling for the timing of those large life cases. Shifting to reinsurance, wholesale, and specialty businesses, overall organic of 14%. This includes Gallagher Re at 12%, US wholesale at 12%, and UK specialty at 16%. So all of these are very similar to what we were seeing throughout the year. Next, let me provide some thoughts on the P&C insurance pricing environment, starting with the primary insurance market. Global Q4 renewal premiums, which include both rate and exposure changes, were up 8.5%. That's in line with the 8%-10% renewal premium change we have been reporting throughout 2022 and 2023. Renewal premium increases continue to be broad-based up across all of our major geographies and most product lines. For example, property is up 15%, even in a slow cat property quarter. General liability is up 6%, workers' comp is up 2%, umbrella and package are each up about 10%. Shifting to the reinsurance market. 1/1 renewals were orderly and reflected a more balanced supply-demand dynamic. Continued strong demand for property cat cover was met with sufficient reinsurance capacity from existing reinsurers and cat bonds. Importantly, reinsurers continued to exercise discipline on pricing and terms, not giving back the structural changes achieved last year. In casualty, while there was adequate supply, most casualty treaties experienced pricing pressure. Specialty lines renewed mostly flattish. However, coverage limitations continued on war-related products. So in our view, insurance and reinsurance carriers continued to behave rationally, pushing for a rate where it's needed to generate an acceptable underwriting profit. Property is still needing rate, and more and more we're hearing about the need for rate and casualty lines. If prior year development turns into a big concern, we think it could be a multi-year journey of rate increases. All that said, always remember, our job as brokers is to help our clients find the best coverage while mitigating price increases. So not all these renewal premium increases ultimately show up in our organic. Moving to our customers' business activity, overall, it continues to be strong. During the Q4, our daily indications showed positive mid-year policy endorsements and audits ahead of last year's levels, so we are not seeing a slowdown. The same strength is also evident in the U.S. labor market, with continued growth in non-farm payrolls and low unemployment rate, which is why I believe our HR consulting, retirement, and benefits business will have terrific opportunities in 2024. As we sit here today, we are very well-positioned. 2023 was a great new business year, and I believe we will continue to win new clients while retaining our existing customers. We have incredible niche expertise. Our client service is top-notch, and our data and analytics continues to distance ourselves from the competition. We can handle any account of any size, anywhere around the globe. All this leads me to reaffirm that we will still see further 2024 brokerage organic in the 7%-9% range that would lead to another outstanding year. Shifting to mergers and acquisitions, we had an excellent Q4, completing 13 new brokerage mergers, representing about $350 million of estimated annualized revenue. I'd like to thank all of our new partners for joining us and extend a very warm welcome to our growing family of Gallagher professionals. We are off to a strong start in 2024. We've already closed four brokerage mergers here in January for about $30 million of annualized revenue. We also have around 40 term sheets signed or being prepared, representing around $350 million of annualized revenue. We know not all of these will ultimately close, but we believe we'll get our fair share, clearly a very strong pipeline. Moving on to risk management segment, Gallagher Bassett. Fourth quarter organic growth was terrific at 13.2%, full year at 15.8%. Adjusted fourth quarter EBITAC margins of 21% and full year at 20%. All this right in line with our December expectations. We also completed one merger in Australia with expected annualized revenue of about $60 million, adding new capabilities in the disability space. Looking forward, we continue to see 2024 organic in the 9%-11% range and full year margins close to 20%, and that would be another outstanding year. I'll conclude with some comments regarding our bedrock culture. It's a culture of client service, ethics, and teamwork, encapsulated in the Gallagher way. It is an unrelenting culture of excellence that helped drive full year 2023 results for our combined brokerage and risk management segments of 18% growth in revenue, of which 10% was organic. 51 mergers with nearly $900 million in estimated annualized revenue, and 20% growth in adjusted EBITAC. Most importantly, we have a culture that our people believe in, embrace, and live every day. It's a huge competitive advantage and will continue to fuel our success and growth. Growth, that is the Gallagher way. Okay, I'll stop now and turn it over to Doug. Doug? Thanks, Pat, and hello, everyone. Today, I'll walk you through our earnings release, commenting on Q4 and full year organic and margins by segment. I'll also provide some comments on our full year 2024 outlook. We'll then shift to the CFO commentary document that we post on our IR website, where I'll provide some comments on our typical modeling helpers and then give two short vignettes, one on investment income and another as a quick refresher on earn-out payable accounting. I'll then conclude my prepared remarks with a few comments on cash, M&A, and capital management. Okay, let's flip to page 3 of the earnings release. Headline, fourth quarter brokerage organic of 7.2% is right in line with our December IR day expectation of 7%-7.5%. But as Pat noted, we see that closer to 8.7% and organic of 11% if we were to also include interest income. That's a darn good quarter, no matter what percentage you want to focus on. A couple other puts and takes to call out on that page. First, contingents did come in a little bit better than our December thinking, due to more favorable carrier performance than we thought at that time. And second, base commission and fee organic of 6.5%. That's where you should levelize for the impact of 606 in those life cases. Controlling for those takes that over 8%. Looking ahead, to 2024, our brokerage segment organic outlook is unchanged from our late October and mid-December expectations. We still see full year organic growth in that 7%-9% range. All right, let's flip to page 5 of the earnings release, to the brokerage segment adjusted EBITAC table. Adjusted fourth quarter EBITAC margin was up 48 basis points. But remember, to get to that requires recomputing last year's fourth quarter using current FX rates. We've done that in this table, and it's 31.3% for Q4 2022. So posting a 31.6% margin this quarter gives you that 48 basis points of margin expansion, and that's right at the high end of our December IR day expectation. Then if you control for the roll-in of Buck and other mergers we closed late in the quarter that have some seasonality, that would have been 150 basis points of expansion. That's simply terrific work by the teams. Looking ahead to next year, we anticipate seeing some full year margin expansion starting at 4% organic. And if organic was, say, double that, maybe around 60 basis points of expansion. And note, that includes about 40 basis points of pressure against it due to the roll-in of M&A, mostly Buck. On a quarterly basis, the headwind is about 80-90 basis points in the Q1 2024. So please don't forget to reflect this nuance in your models. Okay, moving to the risk management segment and the organic and EBITAC tables on pages 5 and 6. Another excellent quarter for Gallagher Bassett. 13.2% organic growth and margins at 21%. We continue to benefit from new business wins and excellent retention. Looking forward, even as we lap growth associated with some large new business wins from early 2023, we see full year 2024 organic in that 9%-11% range and margins around 20%. That's again, that's unchanged from our December views. So let's turn to page 7 of the earnings release in the corporate segment shortcut table. Total segment adjusted Q4 numbers came in a little better than the favorable end of our December IR day expectations, due to less borrowing on our line of credit and slightly lower corporate expenses. So now let's shift to the CFO commentary document, to page 3. That's where we provide many modeling helpers. Most of the fourth quarter actual numbers were very close to our December IR day estimates. We've also now added 2024 information, so take a look at that. In particular, as we're, you know, take a look at FX. We are expecting a small headwind to EPS in the first half within the brokerage segment. Now, moving to page 4 of the CFO commentary document, to the corporate segment outlook for full year 2024. There's no change there to our full year estimate that we provided six weeks ago during our IR day, but we are now providing quarterly estimates. So please take some time to refine your models with this added information. When you get to page 5, this page shows our tax credit carryforwards. You'll see what we discussed at our December IR day. We're able to reestablish a portion of our tax credits following a change in tax method election when we filed our 2022 U.S. federal tax return here in the Q4. Accordingly, as of December thirty-first, we have about $870 million of tax credits available. That's a nice future cash flow sweetener that helps us fund future M&A. So let's turn to the new table that we put in at the top of page 6. We thought this would be helpful as we've been getting a lot of questions about our investment income line. The punchline is that this line includes items such as premium finance revenues, book gains, and equity investments in third-party brokers, in addition to interest income. So this table breaks it down for you by quarter. We hope you will find this helpful. We've also renamed that line in our financial statements to clarify that it contains other items. No numbers change, we've just broadened the descriptor. So just shifting down on that page, on page six, you'll see total brokerage rollover revenue for Q4 was $180 million. That's consistent with our IR day expectation. Looking forward, we've included estimated revenues for mergers closed through yesterday for the brokerage segment in that table, and for the risk management segment in the text below that table. Based on brokerage and risk management mergers closed through yesterday, we're estimating around $540 million of rollover revenues to be recognized in 2024. And also, don't forget, you'll need to make a pick for future M&A, and also add interest expense as we fund a portion of those acquisitions via future borrowings. So while I'm on the topic of M&A, as we foreshadowed in December, we did increase our estimated earn-out payable for Willis Re during the quarter because we now have good line of sight of what we might pay out in the Q1 of 2025. Remember, the accounting for earn-out payables is a bit backwards. If expectations of performance are more favorable, it creates GAAP expense, and if expectations of performance are less favorable, it creates GAAP income. That's what Pat meant when he said, "Counterintuitive accounting." That said, we do adjust out, these estimate changes, but worth a highlight because it does create some GAAP earnings noise. The punchline in all this, and what's more important, our reinsurance business is performing extremely well. So moving to cash, capital management, and M&A funding. Available cash on hand at December 31 was about $400 million, and with another year of strong expected cash flow generation here in 2024, we estimate about $3.5 billion of capacity to fund M&A in 2024 using only free cash and incremental borrowings. So those are my comments. As I reflect on 2023, two metrics for our combined brokerage and risk management segments really sum up how good our year was. Revenue growth of 18%, up $1.5 billion, and adjusted EBITAC growth of 20% or nearly $550 million. So the team delivered another terrific year, and we all have tremendous momentum to do it again here in 2024. Back to you, Pat. Thank you, Doug. And, operator, I think we could go to questions now, please. Thank you. The call is now open for questions. If you have a question, please pick up your handset and press star one on your telephone at this time…. If you are on a speakerphone, please disable that function prior to pressing star one to ensure optimum sound quality. And you may remove yourself from the queue at any point by pressing star two. Again, that's star one for questions. Our first question is coming from Elyse Greenspan with Wells Fargo. Please proceed with your question. Hi, thanks. Good evening. My first question, within the 7%-9% organic brokerage guide for 2024, can you guys give us a sense of what you're assuming for pricing, and economic exposure throughout the course of the year? Well, I think when we did that in our budget process, the range of 7%-9%, it's pretty much so what we're seeing today throughout next year is really the assumptions. Where are we today in pricing? Where are we in exposure units? What we've been running here this year, we don't see a lot of change to that next year. Then when you guys go through and come up with this 7-9, are you assuming that all of your businesses will be in that range? I mean, you know, you've been seeing really strong growth within, you know, reinsurance, wholesale, and specialty. Are those expected to continue to be above, and you know, maybe some of the others, like benefits, might be below? How do you see the different businesses shaking out in 2024? All right, so on that point, not every business is given a flat target number, or do they view it based on what they're seeing in the marketplace, rate, exposure, opportunities, hiring, you know, when they're hiring new producers. So every business does that differently. What would I say is being different? Who's on the upper end of the range, upper end of the range, and who's on maybe the lower end of the range? Benefits might be a little bit on the lower end of the range, and you might see reinsurance and specialty on the upper end of the range in that. But by and large, each business unit rolls it up, and that's how we get to that 7%-9% range. And then, Pat, you mentioned, you know, some interesting comments on the casualty side. You know, we're starting to hear thoughts about, you know, pricing pressure, you know, and just you said, right, multiyear journey here. Could you just tell us, like, what you're seeing and then, you know, how you expect, you know, this cycle could transpire, assuming we do start to see, you know, more reserve holes emerge across the industry? Well, I just think it makes some logical sense, Elise. When you take a look back, we saw this in the property side. You know, nobody touched values for 5, 6, 7 years 'cause inflation was zero. And so you've got a bunch of reserves on the casualty side set at those very same years, then all of a sudden you come into a spike in inflation, and yes, it's been tamped down, but it's still there. And you look back at those reserves, and then you take a look at these settlements that are, in fact, nuclear. And you start to say, "Well, all right, how well are those reserves going to hold up?" Now, look, I, I can't speak for the industry as a whole, but my sense in the meetings that we're having and discussions we're having with a number of the various carriers, is that they have some concerns there. That they are not necessarily comfortable with exactly where they are. And so our view on that is, okay, if you take a look at if there were inflation in those numbers, and if it were something where you had to get them right, you'd have to see price increases in order to do it. I don't think that that's something with the kind of payout structure that you have in casualty that you need to get in one year. I think you're going to see possibly affirming that does in fact take a few years to catch up with reality. One last one. Have you guys reserved to the maximum on the earn-out associated with the Willis Re deal? Effectively, yes. I mean, we still have to accrete that for one more year, so it might be... I think there's $50 million of accretion that will go through the financial statements this next year. Thank you. Thanks, Elise. Thanks for being with us. Thank you. Our next question is coming from Mark Hughes with Truist Securities. Please proceed with your question. Yeah, thanks. Good afternoon. Hi, Mark. Pat, could you give the organic for open brokerage versus the program business within wholesale? Well, I think open brokerage has been where we've had the real nice run up. I mean, it's probably double to triple what's going on in the program business. So if you look at open brokerage at running around 13%-15%, you're probably looking at 5 on the programs. And then, what's your take on the property market? Do you think a little bit of deceleration there? Well, one, do you think that's the case? And two, would it have any kind of material impact on your organic? No, I think. Well, I mean, any change in pricing is going to have an impact on organic, but I'm not. No, I don't see carriers at this point saying, "Oh, the good news is I can take the price backwards." So we are still seeing a push on property rate, and then you do, of course, have carriers incredibly focused on valuations. You know, that kind of went by the wayside for years. There was no inflation, fine, 0%, blah, blah, blah. Now, claims are coming in. They didn't get their premium for it, the, the replacement costs are substantially higher than they maybe predicted. And so I think you do have a little bit of time left, where there's going to be some valuation correction, and I do think there's a need for continued rate strengthening. Thank you very much. Thanks, Mark. Thanks for being with us. Thank you. Our next question comes from the line of Mike Zaremski with BMO Capital Markets. Please proceed with your question. Hey, good evening. So, first question on M&A. You know, you guys have been extremely successful integrating and acquiring firms, but I'm just curious if the landscape has changed a bit in terms of kind of what's available. And I guess, just for example, when I was, you know, you've announced a few bank-owned, you know, brokers. And I believe historically, there's two of your competitors that did most of those. And they would, one of them would talk openly about, you know, those deals being tougher, meaning to take a couple of years to turn them into the growth machines that those companies are. And, you know, Buck was a little different, too. So just curious if you know the pool is changing a bit, and so we should kind of expect slightly different types of deals going forward versus the historical 5-10 years. Well, I'll tell you, first of all, let's remember, I think that when we do acquisitions, we like to talk about the fact that we're getting two things. We're not just getting revenue and earnings, which of course we want and we get, but we're getting terrific brands. And the bank-owned deals happen to be more sizable, and they've got a lot of terrific people. And in addition to the brainpower we're getting, we're getting expertise in the niches from the brainpower, but we're also getting more volume in areas that now we're spreading the brand. And it adds to that, you know, the virtuous circle of knowing about Gallagher, listening to the cold call, accepting the call. I think what we're seeing is that our acquisition targets come aboard, and I guess this is the right way to phrase it: they kind of get on fire. It is our organic engine. There's no question about it. They come in, they've got a lot to say. Now, the bank deals are bigger, but if you take our day in, day out, roll-in acquisitions, these are people that more often than not, have not been able to really tackle the large accounts in their own geography. The minute they sign on to us, they're out telling those clients, "We're part of Gallagher. Here's what we've got. Let me tell you about the expertise we've got. Let me show you some of the things we do in data and analytics." You've all heard us talk about Drive. What do people like you buy? What kind of limits should you have? So we arm them with tools that they just, whether they're in a bank or not a bank, they've never had before. So the excitement level does not take a long time to resonate. The calls go out pretty immediately. "Hey, did you hear that we're, you know, part of another firm?" And these are not folks that are in any way on their back foot. They are on the front foot and moving, literally at the day of closing. Yeah, let me add one thing on that. I think that the organic and Cadence in Eastern was running very similar to what we're seeing in our similar geographies and similar areas. So I think your premise was that it'd take a while to restart them. I think they're already started. I think they're going after it. Buck is already showing terrific organic growth. We don't get it in our numbers for a year. So if somebody goes out and sells something within the year, but we never get organic credit for that. And we get the revenues for it, but we don't get the organic growth credit in our numbers. So I wouldn't say that the premise was of the ones that we bought, that they were. T hey needed a restart. No, in fact, Mike, I'll tell you, what we're referring to in our process is the Gallagher effect. The Gallagher effect is what happens after you announce you're part of Gallagher. It's not a slowdown, you know. It takes their list, their pipeline of prospects, and energizes the team to go back and tell about, "We really have something new to talk about here." And it's not just about, I know you, I've called on you many times. I've got a good relationship in the marketplace. Can I talk to you about your pricing? It's a hard market, soft market, but. No, no. This is, "Let me bring you some data and analytics. Let me show you what's going on in our niches. We have experts in your specific area that I think you're going to want to meet." It's pretty exciting, actually. When I get a chance to get involved, it turns me on. Okay, now, I appreciate that color. Switching gears, you know, and you can tell me if I'm splitting hairs here, but you know, on the December Investor Day, you know, there was a number of reasons, you know, you kind of lowered the very near term 4Q organic growth estimates, you know, versus what you had previously been thinking. And I think a couple of those sounded like they, you know, they were more of like a push into 2024, like on the life insurance side and maybe entertainment business rebounding. Yeah. But I didn't think you really brought up your 24 guide. So I guess, should we, you know, seasonally, obviously, we know there's seasonality in the quarters, but should we be thinking one Q or the first half of the year, you know, gets a little bit more of a bump than it does historically, or am I just reading too much into things? I think you're missing the magnitude of this. In the quarter, let's call it $10 million bucks of a cut, $15 million bucks in total here, that gets pushed out on a $10 billion business next year. Okay, it's 10 or 15 basis points in there, but so that wouldn't be enough to change that 7%-9% guide in there. Okay. And just lastly, I know you, you're one of the leaders, you've been doing it successfully for a while in terms of, you know, moving folks or sorry, you know, your Center Of Excellence. Is, you know, any changes in kind of the trajectory there in terms of what you guys talked about last year, in terms of kind of the goal of, you know, kind of doubling maybe the percentage of employees there over the next 5 or so years? I think what we said is that over the next, 5-7 years, we'll be twice as many people there as we have there now. I think what's really exciting about all the work that we've done for almost 2 decades there now, has put us in a position of being so standardized in many of the processes that we do. We now have the opportunity to unleash AI, on that because that's already done. We have made that investment, and now what we can do is deploy AI against it. And well, those folks, if you're going to hire twice as many folks, they're going to end up with better jobs over there because they're going to be using AI. So our colleagues there are going to be well rewarded by, deploying that technology into it. We are really fired up about it. Yeah, let me hit a couple other items. Why would we need to double our employee count there? Because we're going to double the business. Yes. That's going to lead to plenty of opportunity there. Secondly, and I think this is a hugely important point, standardizing a brokerage business from an agency system through the operating processes to things like issuing certificates of insurance is a bitch. It takes 4-5 years to bang it through. I've done it. It's a headache. We're there. We don't need to do it. We don't need to sell it. It's standard operating procedure. When you join us, you know that in your due diligence, you come aboard, you plan the effort to change into our agency system, and you get rewarded for it by virtue of the data and analytics we can provide you to go out and sell. We don't need to sell our team on that. We don't need to prove it to them. We did that 15 years ago. Thank you. Thank you. Our next question is coming from David Motemaden with Evercore ISI. Please state your question. Hey, good evening. Hi, David. I just had a question on just on. It looks like there was a little bit of favorable timing during the quarter on incentive compensation expenses that helped the margin and brokerage. Was that a big help? And is that something that you guys have sort of baked into the Q1 of 2024, just that timing coming through? Well, first of all, we talked about that, I think, back in our April or June call, that we were probably a little further ahead at that point of the year in our incentive comp accruals. So that's been contemplated in our guidance of margin expansion since way back then. So that, I would say there's no new news of what we were expecting in December versus what we delivered this quarter. So, and what's the impact of it? It's not a point, you know, I mean, so it's not a big number. Got it. Understood. Thank you. And then I just wanted to come back to the 7%-9% brokerage organic for 2024, and sort of level set in terms of what you guys are thinking on the exposure growth side. You know, the range of outcomes that you guys are considering within that 7%-9%. All right. So I think when you break down our organic, we usually have more net new versus lost is probably 3%-4% on that. When you get some rate in there, probably we're at that 2 points, and maybe there's 2 points of it, that's 2 or 3 points, that's exposure unit growth. We're going to have more lift next year from new versus lost, probably proportionately. So if you break down 9%, it might be a third, a third, a third. If you break down 7, it's probably half rate, half, mostly new business and then exposure unit growth on the lower end. Got it. Understood. Good? Thank you. Yeah. Okay. Thanks, David. Thank you. Our next question is coming from Gregory Peters with Raymond James. Please state your question. Good evening, everyone. Hi I guess I'm going to go to the new table that you added to the CFO commentary. Okay which we appreciate, which is the interest, income, premium, finance, revenues, and other income. And, could you, could you give us some perspective? Because ever since this mid-December, when the Fed changed their perspective on what's going to happen with rates, there's obviously some mechanics we're trying to calculate on what might happen with that line, depending on what the Fed does with interest rates. So maybe there's some benchmarks you can provide for us that will help us sort of map out what we think might happen there. All right. So you got the rate sensitivity, and then you've got the amount of cash that we have on our balance sheet. That's not only ours, but our clients, okay? So first and foremost, it's both the rate that we're earning, and then it's the on what we're earning that on. Second of all, you've got the dynamic. You mentioned the Fed. The U.S. portion of that interest income is only about 45% of the number, so it's actually more heavily weighted to international, and you would expect that with kind of large reinsurance balances and some of the large specialty businesses that we have in the U.K. So you got to separate your thinking on that. The other thing, too, is that you've got the growth as it grew this year, it was not only because of rate that was going up, but it was also because of the way the reinsurance receivables migrated from Willis's books onto our books during the transition services agreement. So you got that dynamic in it. I think what you're trying to plumb for is how sensitive is that number to rate changes? I would say that it's probably sensitive $5 million per rate cut that the Fed does in the U.S. per year. So if there's 4 points in it, there's $20 million of 4, 4 cuts, it might be $20 million. Again, that's just answering your question about the Fed. How the other central banks, what they do with their policy next year, I just don't have that number right off the top of my head. But when you asked about the Fed, think about it as $5 million per cut. Excellent. Just a follow-up on that table for 2023. In what quarter did the services agreement with WTW shift? Because I assume that would have meant? July 1. The change. July 1. So when we're looking at the Q3 and Q4, that's more normalized under going forward operating conditions, correct? That's correct. Thank you for that clarification, Yeah, and I also think it's important for. Yeah, okay, you've got it. You've got the premium finance. Just to make sure you know that there's expenses associated with premium finance that's down there. So that, yeah, that's a spread business, but you get it, it grosses up. We get the revenues up above, and then we get the, we have the operating expenses and the interest costs down below in operation. That's excellent detail. I appreciate that. Then there's a bigger picture question I have, but before I get there, I'm hung up on the clean energy tax credit carry forward balance, which caught me by surprise going up. And I know there's obviously a revised approach towards your tax credits here. But without getting into detailed commentary on the changes and the nuances in the tax, is it your expectation going forward that you're still going to be pulling down, you know, $150 million or more of tax credits from clean energy going forward? And then is that $867 just related to the clean energy, or is there other things in that? All right, so two things. You can see on page 5, we have reaffirmed that we think that there'd be about $150 million worth of utilization of that balance in 2024, and maybe when you get to 2025, 2026, 2027, it's somewhere around $180 million of utilization a year. So you need to think about it coming in over the next 4 years. There is a very small other balance of credits in there that I would say is a rounding error, and it has to do with when we constructed our home office building. But I, for all intents and purposes, consider these credits to be from our clean energy work. Great. Thank you. So, pivoting back to the bigger picture question is, I'm going to focus on reinsurance because, you know, last year was one of the most challenging reinsurance renewal periods, you know, in our lifetimes, and especially on the cat side, I should say. And, it clearly, based on your commentary and others, it seems like it's going to be more normal this year. It seems like the lift you might get from the pricing or rate component is going to be a lot less this year than it was last year. So I don't want to get too hung up on, and I realize casualty has its own cadence, but I was just curious about your response to that observation and how you think it might work with Gallagher. Well, first of all, let me just say that when I look back, I, I can't tell you how proud I am of the team. We came into a year, you're new to the organization, you know, we've got some expertise for sure, that got paid, but it, it was, it was very difficult a year ago. And we basically, in a, in a tough environment, took care of our clients. And I, I think that's really so. We learned a lot, all of us, from that. And then we come around to this year, and yeah, the supply and demand balance was a little easier, but what you've got now is a, a group of our clients that, number one, the price is up, and number two, demand is up. So you've got pricing not coming down and people looking and saying, "Now, okay, it's not as sloppy as it was a year ago. I'd like to get more of that." And we saw a bunch of that at 1/1. Remember, about 45% of our business is booked 1/1. So the year when it comes to cat property is pretty much in the bag, and it's been a great year. Easier to place than last year, but as I said, demand up and pricing up. So it still remains a very good market for us, and one in which there aren't that many people, Greg, that can do what we do for our clients. Their larger competitors are very, very good, but it falls off pretty quick after us. That's right. All right, thanks for the answers. Thank you, Greg. Thanks for being with us. Thank you. Our next question comes from the line of Andrew Kligerman with TD Cowen. Please proceed with your question. Hey, thanks a lot, and good evening. I just want to clarify, Doug, when you were saying $5 million per rate cut, just define what you meant by rate cut. How much rate gets cut? 25 basis points. How many? 25. They do a 25. I was referring to a rate cut of 25 basis points. 25 bps. Perfect. Thank you. And then with respect to Gallagher Re, could you talk a bit about how the cross-selling with risk management is playing in. Is that a big driver? And also, I understand you're going to be moving into facultative reinsurance, and or maybe you've been doing that. What kind of tailwinds do those provide to 2024? Well, I mean, first of all, I have to say that the reinsurance team has been incredibly pleased with, and nicely surprised by the amount of interaction with our retail team around the world. And when we did the deal, we told the team and ourselves that we thought there was a considerable benefit from having both sides of the equation under one roof, and that is playing out over, and over, and over again. As you know, we're very, very strong in our niche or niche marketing, and that's a global play. And the capability to have the reinsurance perspective in those meetings, and then we're the largest player in the pooling sector for public clients in the United States. Now, we kind of thought we had that pretty well nailed, you know, not a lot to learn. Our reinsurance team has added a tremendous amount of value and helped us add cover for the pools and revenue for our retailers and revenue for our reinsurance people. So it's been an incredible two-year journey, and we're just getting started in terms of the opportunity to play together in the sandbox. What was the other question, Andrew? Facultative. Facultative. But of course, now coming along with treaty clients, and having our retailers, here's an example of what you're talking about, where our retailers are trying to get things done, and oftentimes in hard-to-place areas like property, et cetera, we are seeing our facultative opportunities grow. No, it's not brand new, but we are organizing ourselves better in the fac world, and I think we're in a better position today than six months ago, to go out to our insurance carrier customers and our trading partners and say, "We want to participate in this. We want to help you." So we are seeing an uptick in opportunities. A lot of tailwinds there. Shifting over to risk management and the, you know, organic change in fees, I mean, just, it seems terrific. And I'm just wondering on the claims management side, what kind of carriers are you growing with? Are they the large ones? Are they the small ones? Like, where are you seeing the most growth in claims management? Well, you're seeing two things. One, our historical play in the risk management accounts, where you've got large accounts, you name it, whatever the large hotel chains are, what have you, that are procuring our business on their accounts. And there's we've had a great, great year in that regard, and that includes public sector clients as well. And then, as you know, we have, over the last decade or so, really focused on outsourcing of claims from insurance companies. And- Right I don't feel at liberty on this call to name some of those, because some of those carriers are pretty, pretty well-known carriers, and not one that I necessarily have the approval to be touting. But from inside the organization, you look at some of these carriers, you go, "It's fantastic." And then, of course, the regional small companies that would like to expand, that don't want to add infrastructure, they think they've got an opportunity in a given state or geography. They don't want to be putting a lot of boots on the ground. We're picking those up as well. So the team at GB is, in my opinion, just outperformed expectations every single year. It just seems like there's in the carriers, I mean, there's just a lot of runway there. Well, let me put it this way, Andrew. I, I, I really believe this. I believe that it will not be unusual, and I believe that people will ask, "Did insurance companies pay their own claims? Why would they do that?" When I sit with some of our insurance company partners and explain to them that Gallagher Bassett pays substantially more claims in numeric numbers and substantially more dollars than they do in claims by line of cover, by geography, not just in the U.S., the first reaction is oftentimes shock. And again, I won't mention any names of carriers. They go, "No, no." I go, "Look, if you put a capital structure around GB and called it an insurance company, it'd be one of the five top insurance companies, probably in the world." Think about that in terms of the amount of claim work that's coming through. Our focus, and this is, I think, really key, and what we're selling, and we believe proving day in and day out, is if you outsource your claim work to us, whether you are a large risk management account that is self-insuring or whether you're a carrier, your outcomes will be superior. If I'm looking at an insurance company CEO and saying, "I think I'm worth or could help you find two points of ROE," it could be pretty dramatic. Sounds like it. Maybe if I could just squeak one last one in. On the contingent revenues, they were up 30% in the quarter. Just given it was such a great year for underwriting, do you see that kind of being flattish as we go into 2024? When you provided your 7%-9% guidance, maybe that impact becomes flattish in the scope of it all. No, I said it. I would say it would be in that same 7%-9% range. I'm not going to see it outperforming that. And yeah, we were pleasantly surprised by a few extra $million than we thought we were going to get there. By the way, look through that number and see what it's telling you as a, as a potential owner. Our book of business is superior to the competition. That's interesting, isn't it? Yeah. Hey, thanks a lot. That was great, great insights. Thanks, dude. Thank you. And our next question comes from the line of Yaron Kinar with Jefferies. Please proceed with your question. Thank you. Good afternoon or good evening. Hi, Yaron. First question I have, and forgive me, it's a bit nitpicky here, but in brokerage organic, I know the organic came in line with December guide, but I think contingents were a bit better than you were expecting. You were already accounting for the life case timing and the 606 accounting. So it seems like there may have been something there that came in a little bit lighter than expectations, or am I thinking about it incorrectly? You know, maybe there's $5 million less than we had hoped on a few of them, but it's. I mean, when you're looking at a $2 billion quarter, you know, $5 million bucks, you know, it does move the percentage a little bit, but it doesn't. It's not a meaningful event. We are a sales organization. I look back last year, we had 11% one quarter, we had 7% another quarter. We had, you know, 9%, 7, you know, 8. So it bounces around a little bit. So, you know, the fact that we brought it in, you know, within half a point or the, you know, of what we're looking at here, it. You do get some bounce around for a few million bucks here or there. Okay. Then a couple of quick ones on the CFO commentary. I am seeing a bit of a slowdown in brokerage earnout payables in 2024. Is that just the Willis Re true up in 2023? That's right. Okay. And then I'm also seeing a meaningful increase in the amortization of intangibles and risk management. Are you expecting any large M&A there, or did you already conduct that? Yeah, we announced My Plan Manager acquisition here a month or so or two, two months ago. So that's the $60 million worth of revenue in that disability business down in Australia. Okay. Got it. Thanks so much. Sure. Thanks. Thanks, Yaron. Thank you. Our next question comes from the line of Michael Ward with Citi. Please proceed with your question. Hi, guys. Thank you. Michael. Maybe just curious on Canada. I, I think one of your peers meant to mention some headwinds there, and I think if we're interpreting the commentary, it sounds like maybe you saw a slowdown, too. Just wondering if you could talk about that dynamic, if you think that should persist in 2024. Well, listen, I think they had some. They were posting 13 points, 14 points of organic growth. The market has shifted up there a little bit, so I think they've been in the mid- to upper mid-single digits for the last 4 or 5 quarters. So I don't see much of a shift going into 2024. Yeah, let me, let me pile on that one, if you would, Michael. First of all, these, Doug hit right on. They've been killing it in Canada. High upper digit organic year in and year out, and now they're about five. That makes perfect sense to me, given where they've been, and I think the five is a great number. Yeah, we actually had a couple of really great new business opportunities that just didn't fall our way, for some reason, that they decided to stay with the incumbent. So I think that if you normalize for those handful of items, I think they would have had, you know, add three or four more points to it. Okay, thank you. And then in the CFO commentary, it looked like you guys outperformed your revenue pick for 2Q-2023 acquisition activity and increased the pick for Q1 for your 2Q-2023 acquisition activity. Just wondering if that is momentum from Buck or what's driving that? All right, help me understand what you're looking at again. Tell me what you saw. I just didn't track to your question. Sorry about that. It was, it was just the revenue pick from 2Q 2023. And you increased the 1Q 2024 pick. Just sort of wondering if that was Buck from. Yeah From 90- 95. Yeah, listen, it's remember, every time we buy something, you're going to get maybe four quarters of this disclosure. So as Buck runs that off, we also have Cadence and Eastern that are coming on in fourth quarter 2024, but that's, you can see it there, the $2,000, second quarter $2,000, it falls away to nothing, right? It goes and which it would, even if it were $5 million a quarter, is 95. So that is what you're seeing there. It's just the run-in of Buck that's no longer a M&A rollover. Okay, awesome. And then maybe just following up on a question from earlier. Did I hear you sort of mention for benefits growth was kind of going to be at the or you think it's going to be towards the bottom end of the kind of spectrum across product lines this year? I just said they might be running more like 7% versus 9% in some things next year. So that's what I said. Got it. They would be more towards that lower end of that 7%-9% range, just on the nature of their business. Got it. Okay. Thanks, guys. Pause on that a little bit, because medical inflation that many are starting to worry about, we might have a different answer for you on that one. Right. That heats up. Thank you. Thanks, Michael. Thank you. Our last question is coming from Meyer Shields with KBW. Please proceed with your question. Thanks. I think two really small ball questions. Doug, you talked about why contingents in the Q4 are a little bit better than the December expectation, but it also sounds like you're not expecting reserve development to be a problem in 2024 if contingent organic matches core organic. Am I thinking about that right? No, I didn't say that. I think that on the casualty lines, I think that would impact our base commission. I don't see it really eroding our supplemental or our contingents. If we do have a reserving, again, I don't like to use the word crisis, but if there's something like that that happens, maybe something will happen. But I don't see that eroding the contingent commission substantially next year as they take rational and orderly rate increases. Okay, understood. And then just, I may have missed this, but the increasing detail on page 6 of the commentary, where we break out the individual components, should we assume that those are all, I don't know, 90% plus margin revenue? No, that's my point was on the premium funding, there's the margin on that would be very similar to our brokerage business. So that's not, you know, equity interest is not that big of a number. We just don't have that many non-100% owned entities on it. And then interest income, yeah, there's margin on that, but remember, interest income is there because there's inflation out there. And we do have inflation in some of our categories, like travel and entertainment, for instance, a substantial inflation in that. So if that- if interest rates come down, then I would expect inflation on travel to come down also. So there are some offsets on it, but the premium funding business is, you know, 30 points of margin, something like that. Okay, perfect. Thanks for the clarification. Thanks, Mair. And let me just say thank you again for joining us this afternoon. And to our 52,000+ colleagues across the globe, thank you for another fantastic year. Our achievements are due to all of your hard work and dedication. As thrilled as I am with our Q4 and full year 2023 performance, I get even more excited when I think about our future. We operate in an essential industry for the economy within a fragmented market, having leading data and analytics and niche expertise and limited global market share. So I believe our opportunities for future growth are immense, and while I, I always say we're just getting started, it's pretty cool to be Gallagher. Look forward to seeing you at our mid-March IR Day. Thanks for being with us today. Thank you. This does conclude today's conference call. 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