I'm Heather Balsky, B of A's Business and Information Services Analyst, and I'm excited to have the team from APi Group, including Russ Becker, President and CEO, and Adam Fee, Vice President of Investor Relations. To kick off, I thought I would ask the question, especially for folks who might be new to the story, can you share what APi does and an overview of your history and sort of detail your value proposition? Sure. Thank you, everybody, for attending. Thank you, Heather, for inviting us to participate, and we're happy to be here. So APi is a company that's got roots that stretch back. We have, I think, our oldest company has roots well, Chubb Fire and Security goes back to the early 1800s. And approximately 70% of our $7 billion in revenue comes from safety services, which is fire, life, safety, and security work. And most recently, as we move into the elevator and escalator inspection service and repair business with the announced acquisition of Elevated. But we have a business model that's focused on selling the inspections first. One of the reasons that we like the life safety space is that for a commercial office building like this, the fire, life, safety systems are required by law to have their suppression systems and their fire alarm systems inspected at least annually. In a building like this, it's probably more like quarterly and for functionality and operability. We have good data that shows that we're going to generate someplace between $3-$4 worth of service work from every dollar of inspection revenue we generate. So we feel like that is a recession-proof business model and, as we like to say, the protective moat around the business. The other 30% of our revenue comes from specialty services, which is really a more diverse set of offerings for our clients, primarily in the infrastructure space. We're doing telecommunications work, natural gas distribution system retrofits, potable water system retrofits. We do a lot of industrial maintenance work for our clients. That's helpful. Drilling down on the life safety space, what do you think differentiates APi against its competition? Are there benefits to your scale? There's no question that there's benefits to our scale. I think really the biggest differentiator. I think there's two differentiators for us, Heather. Number one would be this mindset of we're going to sell inspections into the already built environment. Traditionally, in the industry, most of our peers lead with selling new construction projects. When that project-related work is nearing completion, they look to try to sell to their customers the inspection and service work. We have flipped that model on its ear. We are really focused on going to buildings and facilities that are already built and occupied and selling that inspection work. Again, remember, that's the statutory required work that has to happen on those life safety systems. And we found not only when we do a really good job with the inspection and we do a really good job with the service work, that we build much stickier relationships with our clients. So when they have expansion needs, we're available and there, and we're not competing for that business just based on price. And we think that that's one of the things that is going to help us on our march towards our 13% EBITDA margin expansion goal. I think the second thing that I would tell you that differentiates us is centered on our purpose as a company. And our purpose is building great leaders. As a company and an organization, a long time ago, we realized that if we were going to maximize the profitability and perform at the level that we felt like we were capable of performing, we needed the best damn leaders that we could possibly bring into the business. We have 500 branch locations across the world. Every one of those branches needs to have a great leader. I say this all the time when I'm talking to our people. Every individual team member at APi deserves to have a great leader. The only way you're going to accomplish that is by investing in people as people. We have a really robust learning and development team that's centered on leadership development. We bring our leadership development efforts to the men and the women in the field. We're investing in those. It makes me sad to say it, but the industry has left the men and the women in the field behind. And I think, to a certain degree, has kind of taken an approach that those folks are less than. And we fundamentally don't believe that at APi. We believe that we need to put the men and the women in the field at the center of our thinking and our decision-making and do everything we can to make their lives easier and more productive and a better place for them to work so that they want to stay with the company for the long haul. And we really, truly believe that we will maximize and enhance shareholder value by investing in every one of our team members as a leader. I think it's come up in meetings today. It's a very people-led organization, and your branch's leadership there has a lot of autonomy. And so I want to ask, you operate a branch-led business, and it sounds like you're talking about it already, but your approach to synergies across branches, shared resources, and thoughts around standardization across the branches over time, how do you strike the right balance? I mean, it's a great question. I think depending upon who you ask, you're going to probably get a different response. When we were talking about this earlier, I basically said, on a scale of one to 10, I'd put us at five or six. We want our branch leaders to be entrepreneurs. We want them to own their P&L. We want them to own their relationships in the marketplace. We don't want to if nine or 10 is being a robot, we don't want robots. We want people who are going to use their brains every day that they go to work, and they're going to work hard. Then we want to take the things that need to be standardized and should be standardized, and we want to standardize them. The reality of it is that the people that are leading our businesses, the part of our business that they like, they like going out, winning work, executing work, and building great teams. And so the more of the noise stuff that we can take away from them and we can let them do those things, that's where we're going to ultimately win. You think about it, 85% of our North American safety businesses use a design technology called AutoSPRINK. And the reality of it is, I don't really care if they all use AutoSPRINK or if they use Hydratec or HydraCAD or whatever. I mean, there's obviously scale from a licensing perspective and things like that that come into play. But at the end of the day, when that designer, if this designer, sits down to design, so to speak, this system, and this designer sits down to design this system, at the end of the day, they're going to be different because they're two different designers who have two different experiences and educations and everything else. That doesn't make them good or bad. It just makes them different. I think that's one of the things that we've always embraced at APi, is that we're going to share best practices. We're going to share ideas. We're going to take a best-of approach to how we do things. We're going to challenge people to lead and use their brains and own their results. That makes a lot of sense. Appreciate that. Switching gears a little bit, M&A has been a core part of your business growth strategy. Can you talk about your general philosophy, priorities, what the pipeline looks like from here? Sure. So we have kind of two lanes that we look at M&A from. First would be the more traditional tuck-in, bolt-on, whatever you want to call it, M&A strategy. And you might be buying a $5 million revenue company, a $10 million revenue company, and then bolting that business onto one of your existing companies. And that might give you additional geographical coverage. It might give you an additional service offering. Maybe you're strong in suppression work in one market but weak on fire alarm, and you can buy a $5 million fire alarm business and bolt it onto your existing company. Is the margin profile accretive, or do we see a clear path for that margin profile to be additive to what we're trying to accomplish as a company? And then next, and not last, but next, and maybe the most important, as you get through those three gates, comes down to culture, values, and fit. And you have to be thinking about, "Is this somebody I'd like to have a beer with? And does this person share values with me?" And it's very, very important if you want that business to win when you bring it into one of your existing operations. And then lastly, does the company that you're bolting that business onto have the capacity to take it on and help with the integration? Integration can't just sit at corporate. It's got to be a shared responsibility. And I think it's something that's very important. That's part of our evaluation process when we look at bolt-on M&A. Next would be the lens, which would be larger, maybe more transformational-type acquisitions. Chubb Fire and Security falls squarely into that bucket. The recent acquisition of Elevated Elevators falls squarely into that bucket. That's an adjacency to our existing service offerings that we find super attractive. It's like the life safety space in a do-over. The only difference is that the technician is going into service an elevator. The elevator and escalator space has the same statutory requirements as the fire, life safety. That elevator is required by law to be inspected for functionality and operability just like life safety systems. So we feel like we've had an interest in the space for a long time. And recently, with Bank of America's help, we were able to acquire Elevated, and we're very excited to build a platform from there. But kind of two buckets. And we look at them kind of through independent lenses. We feel like we're, with some of the financing activity that the company's undertaken over the course of the last few months, we have great flexibility and optionality with our balance sheet that's going to allow us to continue to accelerate our bolt-on work and continue to keep our eye open for, "Is there another Elevated coming? Is there another opportunity for us to add to the APi family? All right. That's helpful. Back to the core business, you're on a path. Can we ask Adam one so I can shut up? I mean, other than looking good, he should actually have to say something. Yeah. Well, Adam, I should ask you. Ask him the hard one. Can you ask me anything? I was going to ask about the core business, and I'll ask him on that. Maybe we'll ask sort of a popular question among some investors about your guidance. Your guidance for the year seems a big step up in organic sales growth in the back half. I feel like that's probably been a lot of your time spent on answering this one. Can you help us understand the dynamics there and what gives leadership confidence in the plan? Yeah. So I think there's three things that give us confidence in kind of what our guidance implies for the back half. One, the continued strength in our inspection service and monitoring business. That's something that is consistent in pretty much any macroeconomic times. We continue to expect that to have strong results in the back half of the year. But really, it's going to be driven by recovery of the projects business. So if you think back to Q3 and Q4 of last year, we saw lower organic growth and driven by the projects business because of customer and project selection and specialty and HVAC because of lower price pass-through dynamic that had waned on sales. So we're going to now lap those in the back half of this year. So we'll have easier comps. Second half of last year was 1%-2% organic that we'll be comping against. As we're approaching the back half of the year, we're seeing improvements in our backlog as well. So our backlog improves sequentially. Our life safety backlog is as high as it's ever been for this time of year. And we're seeing backlog stabilize in places like HVAC and specialty at a much healthier expected gross profit margin. So all those things together are giving us that confidence. And this year is really just shaping kind of the opposite shape as last year, where we started off really strong from an organic perspective and had those headwinds in the back half. And now we'll kind of have an opposite-shaped year. Correct me here. When you think of your backlog, is it nine, 12 months of facility? Is that the right framework to think about it? Yeah. Yeah. That's the right way to think about it. Okay. And then I guess that transitions us to the company's on a path towards 60% of your sales coming from inspection, service, and maintenance. Remind us where you are today and what's getting you towards that 60% goal. Yeah. So we're at 52% today. And pro forma for the elevator acquisition, that'll take us up to 53%. And really, to get us to that 60% goal, it's really the same formula that's gotten us to where we've been today. It's that inspection-first strategy that's a real differentiator in our go-to-market and investing behind that inspection-sales force so that we can continue to drive double-digit organic inspection growth across the business, which then pulls through the service work to help our customers get back in compliance if it's a fire or elevator inspection. So as long as we're investing behind that sales force and continuing to execute our pricing strategy, we'll see growth in inspection service and monitoring in that high single-digit range compared to project growth in the lower single-digit range. Organically, we'll continue to turn our way there and use M&A to accelerate the process over time. I mean, you touched on this, but the company's been strategically pruning project revenue. I guess to start, what's typical project work? And kind of what metrics are you looking at today when deciding whether or not you want to retain or pursue certain projects? So typical project work in our safety services segment is really either new installation or major retrofits and upgrades of either fire protection sprinkler systems, alarm systems, security systems in our Chubb business. So it's really the installations and major retrofits and upgrades of those types of systems. And in our specialty segment, it's more installation of utility infrastructure, so critical infrastructure like electric grid, telecom, natural gas distribution, potable water system, things of that nature. And really, what we've been focused on is choosing the right end markets and the right customers. And when we think about that, it's really on the project side. We're challenging our business leaders to propose on projects at a certain margin that we think's appropriate for the value we're bringing to the project. It's really a margin-driven kind of initiative there that is going to help us get to our 13% margin target. Project and customer selection's a big part of that. The only thing I would maybe add to that, Heather, is that some of that pruning in our international business has just been poor-performing contracts that we inherited as part of the acquisition. And if you go back in time, some of those contracts were three years in nature. And so we're kind of coming to the end of that here at the end of 2024 based on when we closed on the acquisition. So some of that is just purposeful pruning on just underperforming, poor-performing. A lot of that's just service and maintenance contracts, so. That's cool. So is it fair to assume, as you move into the back half of the year, you're now transitioning from the more severe, heavy lifting regarding project pruning, but it's still an ongoing journey to some extent? So this whole idea of customer selection, project selection, is not a new concept that we just cranked on, turned on. But we've doubled down the emphasis and the focus on it as it relates to driving expectations towards that margin expansion goal of 13%. So to a certain degree, going back to the earlier conversation that our backlog typically, from a coverage perspective, is 9-12 months, we started this enhanced level of customer selection, project selection about this time last year. Theoretically, we're getting through that period of time. But we're never going to stop. And price is something that's very important. We've brought additional price discipline into the businesses. I think that there's going to be continued opportunity for us to look for the right places and the right customers and clients that value our services that aren't going to just make decisions based on, "Well, you're a buck higher. That makes a lot of sense. And that segues us to the margin question, which is so all of this has put you on a path towards 13%+ EBITDA margins by 2025. Part of it is the pruning, but can you just walk us through the components of the expansion? Yeah. Happy to. I mean, so obviously, customer selection, project selection, improving mix of inspection, service, and monitoring. We talked about 52 now with Elevated, 53. We need to get to 54, 55. Price is a big component of it. Chubb value capture, we've identified $125 million of value capture opportunities inside of Chubb that we're on track to achieve. That's a big component of it. Enterprise Excellence, which is really about just business process improvements, could have some technology projects in there, a number of different initiatives going on. We have set up an Enterprise Excellence office that's managing those projects. Procurement is a driver of that. Obviously, strategic M&A is a component of that. If we go buy a 3% net business, that's not going to be accretive to our goals. And then I like to tell people we have the opportunity to just be better. We've got businesses and branches that perform north of 20% EBITDA margins, which means we got some that are at seven or eight. Inside even Chubb, there was a number of loss-making branches that just need to go away. Either they need to improve their performance or we need to close them, so. So there's a lot of opportunity. Not one single bullet is the answer. It's a lot of levers. It's just a matter of us executing on those initiatives. That's helpful. And how much runway do you think you have beyond 2025? Do you see opportunity for additional scale and efficiencies? You want to give us your next target? She sounds like our board, so. So what I will, I'm not going to give you a target. But what I will tell you is, do we think collectively that there's opportunities for this to be a 14%, 15% business? Yeah, 100%. At some point, most likely next year, we will have an investor day, and we will share where we're moving that goalpost. We're actually planning right now. We have an offsite coming up in July. We're presenting to our board at the end of July, where we're actually going through the efforts and saying, as a team. "What does this company look like in 2028? What does this company look like in 2029?" And you can do some of your own back-of-the-napkin math, and you can see where this company has tremendous opportunities not only on the revenue side but also on the margin side. And I was on my way to Singapore, I think, and I was in the Delta Club on a Saturday night having a scotch. And I was doing some math, and it's pretty good. Hopefully, the napkin that you were doing your math on will get put on a slide for your investor day. We can see the numbers. That actually would have been funny. So funny story. I don't want to take up too much of everybody's time. But I can't even remember when it was. But back in the day, we were a smaller company. We would get industry groups together. So industry group presidents would get together, and we would share best practices and play a round of golf together and break bread and kind of try to get everybody to get to know each other so that they would be more open about sharing. And I can't remember if it was kind of on the heels of 2009, but I'm pretty sure it was. We were down in Scottsdale, and we were at a fancy steak joint, Mastro's. And everybody's kind of huddled up around the piano. And if everybody's been to Mastro's down there, there's a baby grand piano in there. Sometimes they have some fun. Anyways, the cocktails are flying. All of a sudden, everybody starts chirping about what their year's going to look like. I'm like, "Okay." So I got out a napkin and wrote down, "Western States Fire. What do you think you're going to do this year?" It's like, "This is back." We were a smaller company. "Oh, we're going to make $20 million." "Oh, you're so foolish shit." Then it would be like and then you'd just go back to the next guy. "What are you going to do?" Then you'd go to the next guy. "What are you going to" then you'd go back to this guy, and he's like, "Oh, he's going to do this. You can do this." And by the time I had this napkin with totals and tallies on it and I went back to the office, and I scanned it in, and I sent it out to everybody, including the majority shareholder of the company. And there was one guy that wasn't there, and we just penciled him in for something. And my phone rang. I'm not kidding you. 30 seconds after I did that. And I think we did that for like 10 consecutive years. We called it the napkin. And I have every one of those napkins in my drawer at the office. I love that. That's amazing. That's great. So you guys probably think I'm weird, but. No, I think it's great. I think it's great. I don't know if this is. I don't know if it's on a napkin. I don't know if this is written on a napkin or not, but you've talked about the acquisition of Chubb. Can you update us on how that's progressing? Sure. I'll speak to it from a leadership and an operating perspective. And then Adam can give you some of the pertinent details on where we're at from the value capture and what the numbers are and what we're projecting through this year and into next year. But I would start by just saying very happy. That's probably not the right word because I'm never really happy. But I'm pleased with the progress that we continue to make with the business and integrating the business. I feel like we have done well with solving some of the leadership challenges that we had. Probably have one gap that we still need to complete. We have dramatically reduced the number of loss-making branches. We'll have that total, I believe, down to low single digits by the end of this year, if not better than that. We're actually looking at two small bolt-on acquisitions in that business through the same lens. These are the better-performing pieces of the business. They've got the bandwidth to take them on. So that's the first time we've done anything like that since we've owned the company. We've repositioned the Chubb. Canada is now reporting into North America, our North American safety business. Our existing U.K. and European business is now reporting into Chubb. So we've got those reporting lines all cleaned up. So couldn't really be happier. There's always going to be work to do to improve it. We've seen organic growth every quarter since we've owned the business. So a lot of really positive things happening inside that business, so. That's exciting. Yeah. And then just for the value capture, so when we bought the business, we bought the business at a roughly 9% EBITDA margin, and we put a target out for 2025 of 15%. And a big part of that improvement's the $125 million value capture. Exiting 2023, we had realized close to $40 million of the $125 million in the P&L and had taken actions representing more than half of the total savings. And this year and next year, we expect the remaining $85 million to flow through the P&L, with probably a little bit more than half coming this year and a little bit less coming in next year and maybe the early part of 2026. But that's kind of how we see the value capture unfolding over the next two years. That's helpful. We have six minutes. Since we have a mic, I wanted to see if anyone had a question, but I have another question to close this out. If not, I'll check. Go ahead. Or do we need the mic? I didn't give him a cue, so. We can repeat the question. Yeah, we'll repeat it. Yeah. I mean, at the start, you kind of hinted to the benefits of scale. So I'd just be kind of interested, given that it's such a local business, it's very decentralized from a management perspective. And so it certainly sounds like lead managers are actually interested in, yeah, why you think being at the scale you are gives you such an advantage. Question on the benefits of scale, especially given sort of how spread out your business is? Well, I mean, there's a few things. Number one, in my earlier remarks, I said that one of our goals is to try to take away some of the noise from our branches, where we want our people that are leading our branches and leading our businesses are operators, right? And the part of the business that they really like to do is the selling and executing and team-building components of the work that they do. They don't care as much about payroll and things. They want their people to get paid, but they don't necessarily care about payroll. So if you look at our North American Safety Services business as an example, we have efforts. We actually have kind of teams within the team. We call them PAS and BUS. Don't even ask me how we came up with them, but everybody talks about PAS and BUS. That's basically payroll and other shared services activities that we're consolidating in those groups so that we can continue to take advantage of that scale. So Chubb, I would tell you, is like when I talked about the scale of 1-10, they were like borderline robotic kind of where they were taking their business. It was like so much of it was shared services and centers of excellence and all this stuff, where things like accounts receivable, this might sound weird to you, but accounts receivable is a relationship-based component of getting paid in an efficient fashion. So if you got some entity sitting in Toronto, this is a real story, by the way. You got some entity that's sitting in Toronto, and they're calling on receivables in Regina. They're actually not calling them. They don't know the person. They're clicking on an invoice and resending it. And they click on the invoice, and they resend it. Whereas if the person in Regina has a relationship with that client, they pick up the phone, and they call them, their chances that that invoice is going to move to the top of the pile are going to be greatly added to. So you have to find that right balance in this branch operating model. For us, you think about it from a scale perspective, how many trucks and vans we buy. So there's a lot of opportunity for us from a procurement perspective. One of the reasons that we're able to get as much momentum on selling inspections first is the infrastructure that it takes to support a heavy, heavy inspection and service business. So Adam talked about building out the inspection salesforce, which is work that will never really truly be done. But as soon as you sell that inspection, that inspector has to be dispatched to go do the inspection. So you need a dispatcher for that, and you need an inspector for that. Then when the inspector does the work, you have to have somebody that can generate an invoice for that. And then you have to have somebody that can collect it. And then you have to be able to turn that deficiency report into a service proposal. There needs to be a dedicated person for that. And when you really and it goes on because then once you win the service work, you need to dispatch two technicians to go do the service work. And then you got to generate another invoice. All of that stuff takes a tremendous amount of infrastructure to execute on. At the end of the day, the majority of our competitors are still small family-owned businesses. Their willingness and ability to invest in that infrastructure to support that heavy inspection model is not great. What happens is they try to, when things get slow, they try to transition to the space. As soon as a project opportunity comes around, they snap right back, immediately. If you don't have dedicated resources for inspections, dedicated resources for service, dedicated resources for fire alarm, dedicated resources for your contract work, it won't work. If you're trying to move people back and forth, you'll never get the momentum that you need. We figured that out a long time ago and have just been pounding that drum and pounding that drum and pounding that drum. Was that helpful? Yeah. Kind of the way you looked, I'm guessing that didn't really answer your question. Just kind of follow on. If you think about the margin uplift that you would get relative to a very decentralized model, maybe if you could just kind of talk about the unit economics and kind of how they differ. You gave me some great qualitative examples, but I'd just be interested in, yeah, to the extent that there's anything you can share there. Maybe I'll take a shot at that. I mean, one other thing to your last question. Scale also gives you the ability to be close to your customer. And that gives us the ability to run a national services group and cater to customers that are national or regional that other customers couldn't. In terms of unit economics benefits, there's elements of efficiencies and best practices that get spread across the business. The scale and having entrepreneurs at each branch, you almost have 500 branches, 500 incubators for good ideas. So the inspection-first strategy came out of one single branch that got passed around, and now it's a segment-wide strategy. Segment-wide, our field leaders have the same tablets, same software programs. So they're gaining efficiencies. Every one of our branches uses the same process from getting the deficiency report to a service proposal to the customer. So all those things drive standardization where it makes sense but also allows them to be entrepreneurial. And scale gives you a little bit more density too and more capabilities. So right now, we're fire alarms. We grew up as more of a sprinkler company. Now we're sprinkler alarms. We can offer security. We can offer elevators. So having scale allows you to offer more to your customer and gives you better unit economics there too. I think you wanted actual numbers. We're at time, so we'll have to save that. I appreciate the time. Thank you both for joining us today. Thanks so much. Thank you, everybody. Thank you. Thanks, everyone. Appreciate it.