Greetings. Welcome to the Bright Horizons Family Solutions fourth quarter 2021 earnings call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. Please note this conference is being recorded. I will now turn the conference over to your host, Michael Flanagan, Senior Director of Investor Relations. You may begin. Thanks, Shamali, and hello to everyone on the call today. With me here are Stephen Kramer, our Chief Executive Officer, and Elizabeth Boland, our Chief Financial Officer. I'll turn the call over to Stephen after covering a few administrative matters. Today's call is being webcast, and a recording will be available under the Investor Relations section of our website, brighthorizons.com. As a reminder to participants, any forward-looking statements made on this call, including those regarding future business and financial performance, including the impact of COVID-19 on our operations, are subject to the safe harbor statement included in our earnings release. Forward-looking statements inherently involve risks and uncertainties that may cause actual operating and financial results to differ materially and are described in detail in our 2020 Form 10-K and other SEC filings. Any forward-looking statement speaks only as of the date on which it is made, and we undertake no obligation to update any forward-looking statements. We also refer today to non-GAAP financial measures, which are detailed and reconciled to their GAAP counterparts in our earnings release, which is available under the IR section of our website. Stephen will now take us through the review and update of the business. Thanks, Mike, and welcome to everyone who has joined the call. To start this evening, I'll recap our 2021 results and outline how the progress we made this past year positions us well for 2022 and beyond. Elizabeth will follow with a more detailed review of the numbers and outlook before we open it up for your questions. Overall, I'm really pleased with our performance in 2021 and all that the team has accomplished over the last two years. Prior to COVID-19, our business had been on a consistent revenue and earnings growth trajectory, which was upended with the onset of the pandemic and the temporary closure of nearly 80% of our centers. We responded swiftly with an immediate focus on health and safety, supporting clients and their essential frontline workers, and pivoting to create new Back-Up Care solutions for clients and employees to meet the incredible surge in need and demand. Throughout 2021, we gained traction in our recovery as we reopened hundreds of centers and welcomed back thousands of families. At the same time, we delivered hundreds of thousands of days of Back-Up Care, launched services for more than 75 new clients, added 44 new centers, and made important investments in technology and new service offerings that lay the foundation for growth and innovation over the next many years. As a result of all of this, we enter 2022 with good momentum. While the most recent COVID variant surge now appears to be waning, parent and client behavior has still been impacted and will take additional time to normalize. On the plus side, the long-term outlook I see for our business is incredibly positive. In fact, I believe the actions we have taken over the last two years will transform our opportunities in the years ahead. Our long-standing value proposition with clients, families, learners, and our employees has significantly strengthened during this period. Specifically, we have broadened our impact with the addition of more than 225 new clients, extending our service opportunity to more than 10 million eligible lives. We tapped into new potential use by cross-selling additional services to more than 100 existing clients. We galvanized our relationships with our more than 1,350 clients, responding to the unprecedented care needs arising from the chaos created by the pandemic. We led our sector in health and safety practices, strengthening our long-standing reputation for quality care in early education across the U.S., U.K., and Netherlands. We rationalized our existing portfolio of early education centers, while at the same time partnering with employers to expand capacity to meet their evolving needs. We expanded investments in technology to unify our services, speed and improve our end-user experience, and personalize our outreach to prospective and current employees. We invested in innovation, including deployment of additional care types in Back-Up Care and new pathways and partnerships to support adult learners in EdAssist. Finally, now more than ever, we are engaging with the CEO and CHROs of existing and prospective clients. This underscores the strategic importance of the solutions we offer as organizations look to attract, retain, upskill, and differentiate. With these building blocks in place and associated tailwinds, I am confident we are emerging from this pandemic structurally more effective, strategic, and impactful. Let's now take a closer look at our quarter four segment results. To recap the headline numbers for this past quarter, revenue increased 23% to $463 million, which yielded adjusted EBITDA of $79 million and adjusted earnings per share of $0.65, an increase of 81% from the prior year. For the full year 2021, revenue of $1.8 billion represented growth of 16%, while adjusted earnings per share of $1.99 expanded 28% over 2020. In our Full Service segment, revenue grew 29% in Q4 on continued enrollment recovery. We added 14 centers in the quarter, including a second center for Houston Methodist Hospital and a network of 12 centers we acquired in the U.K., expanding our footprint in the Southeast of England. We reopened 17 more centers in Q4 and ended 2021 with 96% of our 1,014 centers open. As we look ahead, the remaining 37 temporarily closed centers are currently slated to reopen in the first half of 2022. In our open centers, we are encouraged by the progressive improvement in enrollment as occupancy levels ticked higher in Q4. Like many other businesses, the spread of Omicron variant has been a disruptor. Specifically for us, it dampened the pace of enrollment growth as prospective families delayed their start dates. Omicron also had an effect on the staffing of early childhood educators, particularly through the holiday period and carrying into January of this year. While still challenging, we are seeing improving trends on the labor front. As we discussed last quarter, the pandemic has exacerbated the staffing pressures the child care industry has long faced. Bright Horizons has always been an employer of choice for early educators, and we have led our field investing in career growth underpinned by development opportunities such as our CDA credentialing and Horizons Teacher Degree Program. In this unprecedented environment, we have also taken a number of actions to specifically address the current conditions, including increased wages, recognition bonuses, and expanded employee benefits to ensure that we are attracting, retaining, and growing the best teachers in the industry. While enrollment is still constrained by our ability to fully staff classrooms, we are encouraged by the early results of these measures. We are closely monitoring the progress, and our talent teams continue to deploy creative solutions, including events like the National Hiring Day that we hosted earlier this month to further accelerate our recruiting efforts. Let me now turn to Back-Up Care, where revenue of $94 million increased 10% over the prior year. Overall, we saw unique users improve sequentially in the quarter, although in-home and in-center use was less than what we expected heading into the quarter. The improvement we saw in mid-fall as the Delta impact started to dissipate was once again disrupted by the emergence and spread of Omicron in the latter half of the fourth quarter and continuing into early 2022. While we have dealt with the impact of COVID spikes over the last two years and recognize this dynamic could well persist in the first half of 2022, we believe the underlying need for backup support among working parents has not diminished. To that end, we have worked hard to roll out additional use types that align with the hurdles facing working parents. Our virtual tutoring solution that we launched mid-2021 has been highly successful, helping those parents whose children's academic progress was impacted by remote learning and other disruptions to their education. We are expanding Steve & Kate's camps to new communities where our clients' employees live and work, including Austin, Atlanta, and Minneapolis, providing more outdoor and enrichment opportunities for children during school holidays and the extended summer break. More recently, we launched virtual camps as another use case for parents in need of support that can be delivered remotely, on-demand, with a similar learning opportunity as an in-person experience. We will continue to innovate on the delivery front with the goal of not only serving more working parents, but also to drive greater uptake of their use banks provided by our client partners. Speaking of clients, the team delivered another strong quarter of new client launches, including Beyond Meat, MITRE, and Southern Company, to name just a few. Not only have we added a record number of new clients over the last two years, but those clients are also larger on average, with double the number of eligible employees per client than in the past. As a result, I remain very optimistic about the longer-term trajectory of backup use and the broader opportunity within our Back-Up Care segment, despite the disruptions that are currently impacting use of traditional in-home and in-center care. Turning to our Education Advisory business, we launched a number of new clients in the quarter, including GEICO, Qualcomm, Synchrony Financial, and Wawa. Activity levels were solid at College Coach, as this business continues to see high interest levels from parents needing help navigating the college admissions process. I remain excited about our opportunity in Workforce Education, as this remains a significant area of investment and focus for employers looking to differentiate their employee value proposition, as well as upskill and reskill their employees into hard-to-fill roles. Before I wrap up, I want to take a moment to thank every member of the Bright Horizons family for their dedication and incredible resolve over the last two years. While there has been significant impact to our families, our employees, and our business, I couldn't be more proud of the way in which our teams came together to deliver the highest quality education and care, always staying true to our mission to be a partner and employer of choice. It is that focus and passion for our mission that will not only have a profound impact on the lives of the many children, families, learners, and clients we have the privilege to serve, but also allow us to realize the many goals we have as an organization over the next several years. We believe we'll emerge from this disruption financially stronger and better positioned competitively to grow and drive value for all of our stakeholders. While the recovery in our industry hasn't been and won't be linear, our resiliency as an organization and the strength of our business model positions us for long-term success. We have and will continue to weather the short-term challenges, but the long-term outlook for our business remains very bright. While a number of variables continue to impact the pace and velocity of our recovery from the effects of the pandemic, we continue to execute on our long-term strategy and have improving visibility to our near-term performance. Therefore, we are pleased to reintroduce top-level guidance on our expectations for near-term operating performance. As we look ahead for 2022, we anticipate 2022 revenue growth of 17%-22%, with operating leverage driving adjusted EPS growth of approximately 60%-70% to $3.20-$3.40 per share. This range contemplates a number of recovery paths based on current trends and our expectations of continued normalization of enrollment and use across our three segments. With that, I'll turn the call over to Elizabeth, who will dive into the quarterly numbers and share more details around our 2022 outlook. Thank you, Stephen, and hello to everybody who's joined the call tonight. To recap the most recent quarter, overall revenue increased 23% to $463 million. Adjusted operating income was $46 million or 10% of revenue, and adjusted EBITDA increased 49% to $79 million or 17% of revenue. In the fourth quarter, we added 14 new centers and reopened 17 centers that had been temporarily closed. We also permanently closed 11 centers. We completed 2021 with revenue up 16% to $1.76 billion, adjusted EBITDA up 21% to $272 million or 15.5% of revenue, and with 977 out of our 1,014 centers open. Full Service revenue increased $75 million in Q4 or 29%, which is at the top end of our expected increase of 25%-30% year-on-year. Our occupancy levels averaged between 50%-60%, having ticked up marginally from Q3 despite the near-term impact of Omicron that Stephen discussed. Adjusted operating income for the Full Service segment improved $36 million over 2020 to a positive $7 million. This represents a 48% flow-through on the revenue growth. The outperformance relative to our 40% flow-through expectation relates to improving efficiency with enrollment and lower than expected labor costs due to staffing constraints, as well as continued support from government programs targeted for the child care industry. As Stephen mentioned, Back-Up Care revenue increased 10% to $94 million, with $31 million of operating income. We continued to expand our client roster with another solid quarter of new client launches, although revenue growth was short of our expectations. As Stephen mentioned, we had softer use levels associated with the spread of the Omicron variant late in the quarter, which affected both the caregiver availability and parent demand for in-home and in-center care. Our Education Advisory segment reported growth of 5% to $30 million on contributions from new client launches and expanded use of our Workforce Education and college admissions advising services. Interest expense of $8 million in Q4 was down about $1 million over 2020 on lower overall borrowing costs. Our structural tax rate on adjusted net income increased to 24% due to the significant increase in taxable income compared to the prior year. Turning to the balance sheet and cash flow, for the year, we generated $227 million in cash from operations. We made investments in capital and acquisitions of $112 million, which compares to $81 million in 2020. We repurchased $214 million of common stock, including $112 million in Q4. We ended the year with $261 million of cash, and our leverage ratio was 2.7 x net debt to EBITDA. Moving on to our 2022 outlook. As Stephen touched on earlier, we're providing annual revenue and earnings guidance for 2022, and we'll share as much color as possible on how we see this year unfolding. Of course, impacts of the pandemic remain difficult to time and to predict, so we are providing a range of potential performance to reflect that ongoing uncertainty. In terms of the top line, we currently expect 2022 revenue growth in the range of 17%-22%, excuse me, or a range of $2.05-$2.15 billion in revenue, which would exceed 2019, the pre-COVID benchmark. At a segment level, we expect Full Service to grow roughly 20%-25%, Back-Up Care to grow between 10% and 20%, and Education Advisory to track to the mid-teens, approximately 15%. Based on what we see now, revenue will grow alongside the gradual improvement of enrollment and use trends over the course of the year. In terms of earnings, this will translate into sequential improvement similar to the cadence we saw in 2021. For the full year, we currently expect 2022 EPS to be in the range of $3.20-$3.40. In the more immediate time frame, we expect our Q1 results to be impacted by the spread of Omicron that began in the latter half of Q4 and has continued into 2022. As a result, our outlook for Q1 is for total revenue growth in the range of 20%-25%, with our Full Service segment recognizing growth of 25%-30%, backup growth in the high single digits, and Education Advisory growth of approximately 15%, similar to the full year. In terms of earnings, we expect Q1 adjusted EPS to be in the range of $0.37 a share to $0.42 a share. Overall, in summary, I share Stephen's sentiment, that we have made significant progress in our recovery over the last two years, and we have a strong, diversified, and differentiated business model to meet our plan by delivering the critical services that meet our client needs. With that, Shamali, we are ready for our Q&A. Thank you. At this time, we will be conducting a question-and-answer session. Our first question comes from the line of Hamzah Mazari with Jefferies. Please proceed with your question. Good afternoon. Thank you. You mentioned in your prepared remarks a few times being better positioned competitively. I think you also mentioned, you know, being structurally more impactful coming out of the pandemic. You know, should investors expect that to show up in, you know, better organic revenue growth relative to kinda your framework that you had pre-COVID? And if so, you know, do you see new center growth growing faster because you have bigger clients? You know, is backup gonna be a bigger contributor or, you know, have you found kinda new adjacent services? Just maybe talk about, you know, where people should begin to kind of see some of those milestones. I know it's early now, but maybe if you could flesh that out a bit. Sure. From a new center growth standpoint, I think the key thing is to consider how you know the arc of our business and you know the relatively long sales and then development cycle. We're very encouraged by the amount of activity on the front end. We have a number of centers that are in development. You know, this year we'll be expecting to open you know somewhere between 35 and 45 centers. There are, as I say, a number that are already in development, so we have visibility on a large number of those. We do have some plans for acquisitions as well that will feed into that. I think that the... You know, just as a reminder, as I say, the development cycle is a long one, and client activity, part of the value, I think, of the conversations we're having with clients now is the very nature of what they're looking at. We have interest in dedicated centers. We have interest in sharing participation in centers, you know, near site versus on-site supports. Being able to respond to those different needs, including, you know, there are opportunities for us to do consortium locations that put our capital to work and tap into many clients' interests. So that's some of what we're seeing on that front. I don't know, Stephen, if there's other color. Yeah, no. I think first, Hamzah, thank you for the question. I would say a couple of things. I'd say first, I think we through this two-year period, as we remarked on, have done very well garnering new clients. We see good outlook as it relates to both continuing along that trajectory, but also the cross-selling efforts that we have been focused on will continue to allow us to see more clients adopting more of our services. I think the second element that, again, really speaks to the strength of what growth into the future is gonna look like is our innovation and our expansion of the kinds of use case opportunities that we now have with our clients and their end users. Then the final piece, which we had started pre-pandemic and continue to invest really in this pandemic period and beyond, is around investments in technology. We believe that we have become a much more tech-enabled set of services that will accrue really good dividends going forward. I think overall, reflecting on where we have been and where we are headed, we definitely feel like we are in a stronger position to deliver the kind of growth that we're excited about. Got it. Very helpful. Just my follow-up question is just on more near term on 2022. I know you've given guidance, maybe talk about, you know, I think this is the first time you gave annual guidance since the pandemic. You know, I think previous communication had been, you know, we may reach pre-COVID, and correct me if I'm wrong. We may reach pre-COVID revenue in Full Service on a quarterly run rate sometime this year, but utilization will take longer. I think it was maybe by end of Q4. And so maybe if you could sort of talk about, you know, why are you comfortable establishing annual guidance right now? Just in terms of, you know, when you think you'll hit pre-COVID revenue in the Full Service business? Sure. You know, I think that the operations of the business over the last two years, and I know we commented on it a few times, there's a lot of variables. There's been a lot of sort of twists and turns over the last couple of years. There also is a through line of steady progress. Specifically to your question on the Full Service business, we've had centers reopen, we've had enrollment coming back. Although it has taken a little bit of a flatter ramp back in toward the pre-COVID levels than we would have anticipated a year and a half ago as we were reopening, it has remained a steady improver, including you know, modest uptick this quarter. Our visibility to that continues into 2022. The demand from parents is there. We are taking a number of steps to both fulfill that demand to meet parents where they are to get staff in the locations where the demand is happening. We have the tools to work on this even as parents are making decisions over a longer period of time and clients are making decisions about their return to office decisions in you know in the course of what's going on you know in the general world at large here. Our confidence comes from that steady progress. As we look out to the rest of this year and see where we are in terms of the occupancy of the centers we have, which ones have interest and demand, that's what puts us on a trajectory to be. You know, we're not at the same level we were a quarter or two ago, looking at mid-year, for pre-COVID revenue. By the second half, end of the year, we do think that we will be proximate and getting back to that pre-COVID time in terms of top line. From an overall occupancy level at this point, you know, the plan, the guidance that we laid out here doesn't get us all the way there back to the pre-COVID occupancy ranges. You know, we had been in the 70%-80% range. What this plan contemplates is us getting close, but not all the way there by the end of the year. We think that it'll take us. You know, we're gonna continue to update you as the year goes along, but we think that we're on a pathway to get close. We'll be more measured than you know, than what that would indicate. Got it. Thank you very much. I'll turn it over. Thanks, Hamza. Okay. Thank you. Our next question comes from the line of George Tong with Goldman Sachs. Please proceed with your question. Hi. Thanks. Good afternoon. Wanted to dive into the impact that you're seeing from labor shortages. Can you talk about whether or not your capacity and your occupancy rates are affected at all by the current labor shortage situation? How your pipeline for recruiting looks like as you look out into the rest of 2022? Yeah. I can take the first part and let Stephen go color commentary on some of the efforts underway on the labor front. We are seeing some constraint on our ability to take enrollment. It is, you know, it's spread out across centers. It's not in only one pocket, but it's also not in every center. Some variability there. In general, we would probably estimate that it's affecting our occupancy by 3%-4%, that we are, you know, that we have demand, and we are not able to match that with the available staffed supply. We are working hard to address that. Stephen, I don't know. Yeah. As we remarked, you know, certainly we have taken a very strong stance as it relates to making sure that we continue our position as an employer of choice. We have invested additionally in wages and benefits. As you will know, we have also been very focused over our history on making sure that we have the most well-educated workforce, obviously continuing to reinforce our efforts around CDA and the Horizons Teacher Degree Program, where any teacher in any one of our centers or schools can go back and get an associate's or a bachelor's degree completely free with no out-of-pocket expense, and really helping to facilitate career mobility and upward trajectory for their careers. In terms of specific actions, you'll see us really actively out there on the recruiting front. You'll know that referrals are still our number one source. Referrals from existing employees are still our number one source of new employees. In addition to that, we continue to be very active with National Hiring Day, social media, and other sort of technology-enabled ways to make sure that the candidate experience is seamless. Overall, I think we've come a long way as it relates to making sure that we are out there and really finding the best talent that is in the marketplace, and again, underscored by our employer of choice status, feel good about our ability to continue to make progress against the demand that we have and the supply shortages that have been endemic in our industry, but certainly are particularly acute today. Got it. Very helpful. Historically, tuition has increased 3%-4% a year. Can you talk about what kinds of tuition increases you're planning for over the next year in the current inflationary environment, and how tuition increases compare or will align with wage inflation and other input cost inflation, like supplies, and facility costs? Yeah, it's an important question, George, because it's obviously been a hallmark of our business model that we are, you know, in an arrangement here where we are sharing the incremental costs with parents, with clients. That discipline around pricing has been key to our sort of steady and predictable performance. In this environment, we are in a balance, as you've heard me talk about in the past, we're in a balanced environment where we are really working hard to regain and re-enroll families, attract new families and re-enroll families who've expressed interest. We are, given that we're in a 50%-60% occupied level, we're balancing out price increases with our cost inflation and believe that we can continue to make and right size those economics over a cycle or two. This year we've done increases that are averaging probably closer to 5%-6%, some geographies higher than that, certainly some geographies a bit lower than that, but averaging on the higher end of what you've seen in the last few years to reflect the inflationary environment on the wage front. If we look ahead another year, I'd say we're probably in a similar higher than average environment. We have made wage adjustments, as Stephen mentioned, to address not only the supply challenges, but also the environment in general. We are balancing out those costs. Most other inflationary costs for us are not that substantial. Our occupancy costs are pretty well set. There's, you know, some new releases that come in, but those are fairly well set. Our sort of operating controllable costs tend to be between 5%-10% of overall operating costs. We're not even though there are some inflationary impacts there, probably the only one I'd call out that may be more of a variable would be sort of energy costs, but that's still manageable at this point. As we look ahead 12 months, I'd say that we're looking, as I say, in that similar range of somewhere between 5%-6% on average, perhaps next year. In the meantime, if we see a general, you know, further pressure and change, we could look at something that's a mid-year adjustment in certain locations if warranted. That's not what we're planning at the moment, but we certainly have the flexibility to do that. Got it. Very helpful. Thank you. Thanks. Our next question comes from the line of Jeff Silber with BMO Capital Markets. Please proceed with your question. Thank you so much. In your commentary about backup, you talked about some weakness in in-home and in-center business. I'm sorry, can I just get a little bit more color on that? I didn't really hear the specifics around that. Yeah. I mean, I think that first, when we think about in-center and in-home care, we you know believe and certainly our research suggests that parents are you know thinking about the use of those opportunities even more than they are thinking about it in terms of our full service centers. When a variant, for example, hits, we see an increase in cancellations. We see you know resistance to making new reservations. That's really reflective of the fact that when someone is thinking about how they're going to deal with intermittent care, they are much more careful than what they might do for permanent care, where they know there's consistency in the children and teachers in the classroom versus being an intermittent child for the day, either in-home or in-center. I think that certainly as we saw through the fall with Delta, and then we saw again more recently with the new variant, you know, people were more cautious, and we saw that show up in the form of new reservations and cancellations. That said, I think we're also really clear about the fact that, you know, we have additional use types beyond in-center and in-home to include things like virtual tutoring, things like camps, both virtually and in person. We have seen a nice uptick as it relates to, you know, those use types, along with the fact that during those more difficult times from a COVID perspective, we certainly have seen an uptick versus what we would have expected as it relates to reimbursed care. Again, we tried to call out the fact that, you know, as the variant started to surge, we did see some hesitation among families for in-center and in-home for a single day or intermittent care. Again, we have good use types to compensate for some of that, and also the longer term, still feeling quite positive about families continuing to use our Back-Up Care services. Okay, great. I understand that. Thank you. Getting back to near-term trends, you know, we've seen in a number of locales, New York City, a lot of other Northeast areas, that the Omicron variant has really waned pretty dramatically. I'm just curious, you know, you saw some negative impact in the fourth quarter. Are you starting to see that kind of shift away in certain geographic areas where we're seeing declines in cases? Yeah. I think I would start, and Elizabeth, feel free to add color, but I would start by saying the phenomenon of the you know rapidly declining is really new, right? I wouldn't say that we have seen a real trend as of this point only because this is a recent scenario where the cases are coming down dramatically. What we anticipate, of course, is that it will have an impact, obviously, on our business, and we'll continue to further parent confidence in utilizing our services. To answer your question directly, it is still a little soon to be declaring that that will be the cause and effect and what the direct impact will be. Overall, we're cautiously optimistic. I would say, you know, in the spirit of full transparency, it is soon to be declaring that at this point. Okay. Appreciate the color. Thanks so much. Thanks, Jeff. Thanks, Jeff. Our next question comes from the line of Stephanie Moore with JPMorgan, please proceed with your question. Hi, good afternoon. I just wanna clarify on the utilization rate not really reaching back to that high 70s level by the end of the year. It sounds like it's really due to constraints on the labor front as opposed to center reopenings, parents wanting to put their kids back. You know, if it is a big change in the labor supply situation, and I guess as you look into 2023, if that situation alleviates, do you expect it to be maybe a first half 2023 event when we'll see kind of that high 70s utilization rate again? I mean, I think that what you're pointing out, Stephanie, is the different inputs and impacts that can happen here. Certainly across the portfolio, we will have some variability here, but we are looking at an environment that is constrained on the staffing side. The protocol, the actions we're taking, our policies, our procedures, all those are taking hold. We are heartened by the early results, but they need time to bear all the fruit that we need in terms of the demand that we see out there. I think it's also the combination of that constraint along with what we've seen in parents sort of gradually coming back. Stephen alluded to it here, but the changes in sentiment in the headlines translates to actual behavior in a nonlinear way and over time. We will see how it unfolds, but what we're prognosticating now is a gradual return from parents us being able to continue to gradually address the staffing constraints and knowing that there's demand there. There's need, there's demand, and there's our ability to service the need when we can get all these synced up. That's what's driving our predictions. To the question of whether it will be the first half of 2023, we certainly see a path to get there, but we need to get through the next couple of quarters of all of this normalizing more to be more definitive about that. Okay. That's helpful color. We've seen some news headlines of just some employers stopping, or they've kind of given up on putting a date on when they want their employees back in the office. That's certainly not the case for our firm, but we've seen headlines from other industries doing that. I guess what conversations are you having with your clients on maybe the kind of services that they're looking for kind of this year into next year? Maybe is it more geared towards expanding Back-Up Care options or you're still having conversations about wanting on-site centers? Just if you can give some color on the conversations that you've been having and interest levels. Sure. Happy to, Stephanie. First, what I would say is that in our conversations with our clients and prospective clients, there seems to be fairly pervasive ambition to get employees back to the office. I think that, you know, likely we're gonna start seeing that. You know, obviously, it's been led by financial services, especially in New York, but we are starting to see that more pervasively throughout the country. First, I think there is real ambition for employers to get, you know, employees back to the office. Secondly, as it relates to, you know, the conversations we're having, we're really upbeat about the conversations we're having about on-site centers. We, you know, are certainly engaging, as I said, with CEOs and CHROs of a lot of organizations who are truly contemplating whether or not this is the time that they wanna be stepping into that type of support for their employees. There's really two elements to the conversation. The first is, they really wanna make their office, their work site an attractive place for employees to come back to and ultimately want to be back at. They are seeing worksite childcare as a great amenity in addition to the attraction and retention tool it has always been. They're really seeing it as an amenity. I think the second piece is that as they contemplate, you know, the full service centers, it is also under the guise that they recognize that there is a growing shortage coming in terms of their employees being able to get back to work and back to the office. They are trying to address it from the perspective that it is one of the top challenges that their employees are citing in terms of their ability to get back to work and ultimately get back to the office. That said, Back-Up Care has, through this pandemic, really been seen as a business continuity tool, and so we really continue to see really good interest from prospective clients about adding Back-Up Care to their arsenal to keep their employees productive and ultimately being an employer of choice. Overriding all of this is the additional piece around upskilling and reskilling. We're hearing from a lot of our clients and prospective clients about their need to fill hard-to-fill jobs and using education as a key tool to not only differentiate who they are as an employer, but also to be really prescriptive about educational opportunities that will enable their current employees to ultimately be ready to fill those kinds of roles. I think, you know, we are incredibly well positioned vis-à-vis the strategic challenges that employers are having today across all of our service segments and are having really robust conversations on that basis. Okay, great. That's very good color. Thank you. Thank you. As a reminder, if anyone has any questions, you may press star one on your telephone keypad in order to join the queue. Our next question comes from the line of Toni Kaplan with Morgan Stanley. Please proceed with your question. Great, thanks. Wanted to follow up on that last question, actually. Definitely appreciate your comments on employers wanting to provide more benefits. And so I guess, and obviously Universal Pre-K is maybe sort of less in the news right now after you know what's been you know not passing. Like, basically how does Universal Pre-K fit into the employer thinking on whether it's worth you know starting up a new center? Like, does that come up at all, or is that just something that you know maybe investors are thinking about and not employers? Yes. I don't think that is a focus for employers. I think that what employers recognize is the largest shortage in care is very specific to the younger age groups. Typically in communities, the largest percentage of availability is at the preschool level. Where employers have historically, and certainly as they look out into the future, wanted to place the most emphasis is in infant care, where it's in shortest supply, and then progressively from there. I think, you know, there is very little intersection between sort of where the government is focused in terms of potentially moving downstream from elementary education into preschool, which as you rightly point out, Toni, seems to, at this point, be stalled. Rather thinking about the return to work, getting both mothers and fathers back to work after maternity or paternity leave, having a high-quality on-site childcare experience to return to, and then ultimately providing what is available, what is affordable, and what is, most importantly, high-quality care at the work site. I think they're sort of on two very different paths. The employer is really focused on getting employees back to work and ensuring that there is a high-quality space available for young children, and the government is thinking about whether or not they wanna come down from public elementary education into early childhood education at the preschool level. Two really different concepts. Yep, got it. Just for my follow-up, just wanted to ask about M&A. You mentioned a few times on the call that, you know, maybe we should expect some of the increased number of centers this year to be driven by M&A. You know, should we expect that to be bigger this year, especially as you're on this recovery path? Or, you know, when should we start to see, you know, that get bigger if or should it not get bigger? You know, you tell me. Well, just to clarify, we did actually complete an acquisition in the fourth quarter of a 12-center group in the U.K.. With that and a couple of other single site locations that we did earlier in the year, we actually did add a pretty typical average number of centers by acquisition in 2021 that sort of tuck in size of around, you know, aiming for around 15 centers or so in a year. I think our plan calls for a similar level of acquisitions, so nothing outsized, but also certainly a handful of either single sites or, you know, anywhere from 2 - 4 or 5 center groupings that would comprise that kind of a cohort to add in 2022. I think more to the point of what you're asking is how is the market for M&A and is it coming back? I think our perception of that would be that in selective markets, it's coming back more readily than others. Many sellers are still waiting for their performance to return to a pre-COVID level to be able to realize a value that they have their mind and heart set on. There's been more waiting on the sidelines. Certainly in the U.S., there's been some more support for some of these facilities longer than we would have anticipated. Owners are hanging on a bit longer. We're both disciplined about the prices we pay, but also it's an opportunity to really be, you know, sort of laser-focused on where it is that we want to be over the next many years. We're being careful that way. Other thoughts on the market, Stephen? Yeah. I would say the only thing I would add, 'cause I completely agree with all of those sentiments, is that very specifically, as we are seeing, markets progress towards pre-COVID levels, sellers are absolutely becoming more interested in the conversation. The good news is we have teams on the ground in the U.S., the U.K., and the Netherlands. We're seen as an acquirer of choice. You know, we have strong belief that as the recovery continues to take shape, we will be in the right place as it relates to, you know, being able to find some really high-quality acquisitions. The other piece that is just worth observing is we continue to look, you know, globally at markets that today we don't operate in. We believe that there may be opportunities over the coming years to continue to expand our footprint outside of the three main areas that we operate today. Again, in the three geographies, we believe that there'll be some good opportunities forthcoming. Then likewise, we continue to be mindful of other places where there is some form of third-party support, either in the form of employers or in the form of government or both, for us to continue to track and build relationship. Terrific. Thanks. Thanks, Toni. Our next question comes from the line of Jeffrey Meuler with Baird. Please proceed with your question. Yeah. Thanks. Good afternoon. Wanted to ask about the implied step-up in the expense base into Q1, and then I guess subsequently, it actually looks like you have pretty good margins over the balance of the year following Q1. So anything unusual in Q1? Just wondering if there's any sort of like temporary surge labor rates given Omicron, anything in terms of the full year guidance around what's assumed for the timing of government support benefits or just anything else other than the enrollment ramp that follows Q1 that would help with the margin ramp from there or just better understanding the expense base sequencing as the year goes. No, it's certainly a fair point and question. A number of things do happen in the first quarter that are a little bit different than the fourth quarter. We have obviously there are the resets of everything from payroll taxes, payroll tax limits, which have an impact. There certainly are some plans that we are launching and have been you know in flight that have gotten launched in Q1. There's some cost step-up there. Your point about the government funding is an important one. We had in 2021 we had a back-end-weighted result as more states opened up their grant applications, and they were deploying funds more in the third and fourth quarter. In Q3, we had about $11 million or so, similar in Q4. That, you know, we are planning for some continued government funding in 2022, but it is very dependent on these states rolling out their funds, and some of them have gotten further along in that process than others. There is a bit of a lower assumption going on both throughout the whole year and comparing Q4 - Q1. We're looking at more like, call it $25 million or so for the full year. And it's pretty straight-lined in that view. That's one element. I think the other is that we are you know from an overall backup use standpoint when we have more backup use and we're looking at having that continue to progress there's more cost as we deliver the care than there would be in an environment where we're paused and experiencing what Stephen talked about a few minutes ago. The last thing I'd point out is that we did mention last year we acquired a business in late 2020 called Sittercity and it is a platform investment that's part and parcel of our service delivery of enhanced family supports. We have some investment going on there that's more enhanced in Q1 than it was in Q4, the latter part of 2021. That's a step-up of several million as well. There's components like that. Okay. Helpful. Thank you. If and when Back-Up Care usage normalizes or goes back to, like, pre-COVID fulfillment percentages and mix, so more in-home and in-center, and I don't know to what extent you expect some of the new services to be additive on a lasting basis versus where there's a cannibalistic effect, like with the self-source reimbursed care. Long preamble, but if and when Back-Up Care usage normalizes, what does that mean for your revenue relative to kind of the current trend line or what's assumed in that 10%-20% growth in 2022? I had you right up until the last part of the question where I think you were asking about what's the revenue trend line or is it what's the usage trend line? No. Yeah, like, if you would look at Back-Up Care going back to, like some more normalized mix and usage. Yes. Is there like a step function higher for you in terms of Back-Up Care revenue, or are you assuming you largely normalize in the 2022 guidance? Just not sure how mix is impacting you at this point relative to what you would expect to be more normal. Yeah, I mean, you know, for the overall year, the comparative in Q1 is a bit lighter in that high single digits. We do expect as use continues to pick up over the year, what we are looking to do in the different use cases, along with the natural high use area over the summer, that it would be progressing more toward that, you know, if it's in the 10%-20% range for the full year, it would be stepping up against Q1 accordingly. Pretty steady growth there. I think that the elements there are more around how, you know, how we manage the cost against that and the different kinds of use. I think if you're I mean, so Sorry. Yeah. Well, I guess just the view is like your Full Service business is pretty clearly under-earning in 2022, and your margin- Yes. utilization are not where they're going. I'm wondering if there's a similar dynamic in Back-Up Care where because mix hasn't yet normalized for you, if it too is under-earning, considering how many new clients you've onboarded the last few years through the pandemic. Well, I think if I could start, Jeff Silber. Yeah. I'm not sure what Stephen was gonna add there, but it is true to say that we have not been able to capture and deliver all the use that would be implied by having added all of those clients that we've added over the last couple of years. They are still underutilizing to a target that we would have to what we know their populations could consume. So there is absolutely an opportunity there to have to drive even more use than we're planning for this year as those clients season. So they're under-earning in absolute dollars. In terms of the performance of backup against the revenue we have, in this 10%-20% range that we're expecting for this year, we do expect margins to be performing in the range of our long-term guide of 25%-35% overall for the year. We do think that the performance for the revenue we have will be consistent. It's not really under-earning for that, but there is opportunity for more revenue and then for that to convert to more operating income. Got it. Thank you. Thanks, Jeff. Excellent. Well, we appreciate everyone joining the call this evening, and wishing you a great night. Thanks, everyone. Take care. This concludes today's conference, and you may disconnect your lines at this time. Thank you for your participation.