Welcome to the Q1 2021 FranklinCovey Earnings Conference Call. My name is Adrienne, and I'll be your operator for today's call. At this time, all participants are in a listen-only mode. Later, we'll conduct a question and answer session. During the question and answer session, if you have a question, please press star then one on your touch-tone phone. I'll now turn the call over to Derek Hatch, Corporate Controller. Derek, you may begin. Thank you. Good afternoon, ladies and gentlemen. On behalf of FranklinCovey, I would like to welcome you to our first quarter financial results call this afternoon and welcome everyone to 2021. We hope everybody had a safe and healthy beginning to the new year, and hopefully you'll enjoy today's presentation. Before we begin today's presentation, we want to remind everybody that this presentation contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are based upon management's current expectations and are subject to various risks and uncertainties, including but not limited to, the ability of the company to stabilize and grow revenues, the acceptance of and renewal rates for our subscription offerings, including the All Access Pass and Leader in Me memberships, the duration of and recovery from the COVID-19 pandemic, the ability of the company to hire productive sales professionals, general economic conditions, competition in the company's targeted marketplace, market acceptance of new offerings or services and marketing strategies, changes in the company's market share, changes in the size of the overall market for the company's products, changes in the training and spending policies of the company's clients and other factors identified and discussed in the company's most recent annual report on Form 10-K and other periodic reports filed with the Securities and Exchange Commission. Many of these conditions are beyond our control or influence, any one of which may cause future results to differ materially from the company's current expectations, and there can be no assurance the company's actual future performance will meet management's expectations. These forward-looking statements are based on management's current expectations, and we undertake no obligation to update or revise these forward-looking statements to reflect events or circumstances after the date of today's presentation, except as required by law. With that out of the way, we'd like to turn the time over this afternoon to Mr. Bob Whitman, our Chairman and Chief Executive Officer. Bob? Thanks, Derek. Good afternoon, everyone. We're happy to have the opportunity to talk with you today. We're pleased that in the first quarter of fiscal 2021, our operations continued to demonstrate their strength, agility, and ability to progress even during the continuing pandemic. Specifically, as you can see in slide three, in the first quarter, revenue was strong, driven particularly by the strength and growth of All Access Pass and related sales. Gross margins increased by 359 basis points compared to those in last year's strong first quarter. Operating SG&A declined by $4.4 million. Adjusted EBITDA was $3.7 million versus an expectation of between $2 million and $2.5 million. Our net cash provided by operating activities increased 60% or $4.1 million to $10.9 million, substantially exceeding even the $6.8 million of net cash provided by operating activities in last year's first quarter. We ended the quarter with approximately $49 million of liquidity, up from $42 million at the end of the fiscal year in August and up from $39 million at the start of the pandemic. We're pleased with the continued progress in the first quarter, and I'd like to discuss those results in more detail in just a moment. First, just thought we'd provide a little context. In our year-end conference call a little over two months ago, we reported that in our enterprise division in North America, which accounts for approximately 70% of total enterprise sales and where All Access Pass and related sales account for 84% of total sales on the way to 90%. We reported first, as you can see on slide four, chart 1A on slide four in the upper left-hand corner, as expected, reported All Access Pass subscription sales had remained strong throughout the pandemic to date, growing 18% in North America for the period March through August. As indicated, we said that we expected All Access Pass subscription sales to continue to be strong through this year's fiscal first quarter and on an ongoing basis thereafter. Second, as shown in chart 1B on slide four, we said that after the initial disruption of live on-site coaching and training services during the first six weeks of the pandemic, our quick pivot to delivering training and coaching services live online, a capability we've had for more than a decade, allowed our add-on services to rebound quickly. We reported that as a result, by July, our new bookings of services had returned to essentially the same levels we had achieved in the prior year. We said that we expected this booking trend to continue in Q1 and beyond. Third, in chart 1C, in our international operations, we reported that despite having had only nascent All Access Pass subscription businesses in most of our international operations, and thus a relatively small base of All Access Pass subscription revenue to cushion them, they had begun to recover. As we said, we expected these operations to strengthen further as the year progressed, and that the accelerated focus on All Access Pass in these offices would, over the next few years, allow them to achieve a strong base of subscription and related revenue retention rates and build up the deferred revenue similar to that currently being achieved in our North American operations. Finally, as indicated in 1D, we said that in our education division which accounts for just under 20% of total sales. We had achieved very high Leader in Me subscription school retention in last fiscal year, and that remarkably, in the middle of the pandemic, we had also added 300-plus new schools, almost all of which came on during the pandemic. We said that notwithstanding a continued difficult school environment, we expect our subscription retention to remain high, and even increase in fiscal 2021, and that we expect to add even more new Leader in Me schools in fiscal 2021 than in fiscal 2020. While the environment has continued to be challenging, we're happy to report that as indicated in slide five, these positive trends have continued and even accelerated through the first quarter, and are continuing to accelerate in the second quarter. As shown, 1A, All Access Pass subscription sales continued to be very strong in the first quarter, and invoiced amounts accelerated even faster. They're building the foundation for future acceleration of actual subscription sales. Second, All Access Pass-related sales rebounded quickly and are now exceeding the levels achieved last year, even pre-pandemic. 1C, sales in China, Japan, and among our other international offices, have continued their strong recovery. Finally, Leader in Me membership retention from existing Leader in Me schools has been very strong in the first quarter, as we'll talk about in sales to new schools are off to a very encouraging start. Diving a little deeper, I'd like to address each of these points so that you have some background and transparency on them. First, as shown in chart 1A in slide six, total company All Access Pass subscription sales grew 16% in the first quarter to $17 million, and grew 17% to $65 million for the latest 12 months. In addition, as also shown in chart 1B in slide six, total company All Access Pass amounts invoiced, which were added to the balance sheet and which form the basis for accelerated future growth in sales. Oops, we got some paper shuffling in the back here. Sorry. Our invoice amounts increased an extremely strong 55% in the first quarter. Even excluding a large government All Access Pass contract, growth in invoice sales was still a very strong 32%. This establishes a strong foundation for accelerating future growth. Importantly, All Access Pass performance is strong across all of the key elements that we look at for All Access Pass, including sales to new logos, which increased substantially both in the first quarter and for the latest 12 months. Nine of those 12 months, of course, took place during the pandemic and still had new logos increase every quarter. Annual revenue retention, which continued to exceed 90%, both for the quarter and for the latest 12 months, as you can see in 1C, the sale of multi-year contracts, which is shown in 1D, where unbilled deferred revenue related to multi-year contracts grew 19% in Q1 compared to Q1 2020 to $40.5 million. We're really pleased that all of the key underlying metrics and drivers were strong. As shown in chart 1A, again, on slide seven, in addition, in North America, as previously noted, our almost immediate pivot to booking and delivering coaching and training engagements live online allowed us to continue to meet the needs of our customers remotely. Interestingly, the flexibility which live online delivery provides has, in many cases, also resulted in clients expanding the extent of their use of add-on services because they see it's so simple to get people together and do it. As shown, the strong booking trend for add-on services, almost all of which are now being delivered online, which by July had resulted in our booking pace equaling that achieved at the same time in the prior year then exceeding it by the end of August, has continued strong through December. The increase in bookings, which is a lead measure, a predictive measure, because it's booked but not yet recognized, drove an increase in the lag measure, which is the actual invoice sale of services having been delivered, both bookings and sale of services have continued to strengthen. As you can see in chart one of slide seven, with the beginning of the pandemic in March, bookings of live on-site services were necessarily canceled with stay-at-home restrictions, the year-over-year volume of services followed down, with delivered engagements down $6.9 million in North America in the third quarter. In the fourth quarter of fiscal 2020, new bookings increased to the level nearly equal to that we'd achieved in the fourth quarter of fiscal 2019, this in turn drove an increase in the dollar volume of services actually delivered. As a result, instead of being off $6.9 million as in the third quarter, the dollar volume of services delivered in the fourth quarter was off only $1.1 million. This same positive trend continued the first quarter. The total bookings were up year-over-year, invoice of sales which followed were only off $200,000 compared even to last year's very strong first quarter. When you add in December's results for the first four months of fiscal 2021, September through December, actual sales of services delivered exceeded those achieved for the same four-month period last year, which was a very strong period for us last year pre-pandemic. As shown in chart 1B in slide seven, it's important that 87% of our clients have now shifted to live online delivery of services. This is important. With 87% of our clients now having shifted to live online, our susceptibility to future cancellations has been reduced substantially. We're very pleased with the trends continuing here. Let me just turn to our international operations. Since you can see in slide eight, sales in China, Japan, Germany, and among our other direct offices and licensee partners in the first quarter improved substantially compared to both the third and fourth quarters. At the start of the pandemic, we had to reschedule substantially all live on-site training engagements in these countries. Since these countries were just starting to sell All Access Pass, and therefore did not have a strong base of durable subscription revenue to cushion them, sales in these countries declined to only $4.1 million in the third quarter, compared to $12.7 million in the third quarter of fiscal 2019. In last year's fourth quarter, while still operating well below the levels achieved in last year's fourth quarter, sequential sales in these countries increased 70% to $7 million from the $4.1 million in sales in last year's third quarter. We had said we had expected that our international operations would continue to strengthen in the first quarter, and we were pleased that they did. As shown in the first quarter, international sales were $9.9 million, ahead of our expectation of $9 million. While still below the level achieved last year, this represented an increase of $2.9 million or 41% compared to the $7 million achieved in the fourth quarter and was 2.4 times the $4.1 million amount achieved in the third quarter. Importantly, in addition to the significant recovery in reported sales, our international operations have also seen strong increases in All Access Pass amounts invoiced, which are starting to build the balance of deferred revenue on the balance sheet that will drive sales in these countries in the future. We feel good about the direction in these countries and strategically also the acceleration of their shift to All Access Pass. Finally, as shown in slide nine, in the Education division, despite an environment that continues to be very challenging, as we all know, we've seen some strengthening in trends in the first quarter, including, one, that the number of Leader in Me schools which have renewed or are ready to renew their Leader in Me membership contracts has increased to 615 compared to 450 schools at the same time last year. Second thing is that the number of new Leader in Me schools contracting or in the process of contracting after being down in the fourth quarter, is equal to that achieved in last year's first quarter, which was, of course, pre-pandemic. Considering the current education environment, we feel very good and encouraged about these trends in education. Let me now dive a little deeper into our first quarter performance. Looking at slide 10, as you can see, our first quarter performance was stronger than expected and thankfully, we're grateful, showed positive momentum on almost every front. Our Adjusted EBITDA for the first quarter was $3.7 million, exceeding our expectation of achieving Adjusted EBITDA between $2 million and $2.5 million. These results are even more notable in light of the fact that last year's first quarter was itself very strong. As shown in slide 11, our cash flow and liquidity position were also very strong. As shown in slide 11, our net cash generated for the quarter of $532,000 in one of our lowest quarters was $4.9 million higher than last year's first quarter. This reflects almost entirely that our significant growth to new All Access Pass contracts invoiced, resulting in our net deferred revenue position, not going down as much. We're pulling stuff off the balance sheet versus what you added on, actually improved by $6 million versus the prior year. As you can see in slide 12, also, our cash flow from operating activities for the first quarter was $10.9 million, which was $4.1 million or 60% higher than last year's $6.8 million. This strong cash flow reflects that an additional benefit of our subscription business model is that we invoice upfront and collect all of the cash faster than we recognize all of the income. It actually generates cash faster than it generates income. As a result, we ended our fiscal year in August with more than $40 million in total liquidity, comprised of $27 million of cash and our $15 million revolving credit facility undrawn, an amount that was even higher than we had at the start of the pandemic. We're pleased that we added further to this liquidity during the first quarter. In the first quarter, with $49 million of total liquidity, comprised of $34 million of cash, which means no net debt, and with our $15 million revolving credit facility still undrawn and available. We're pleased with the financial position. This strong performance was driven by, as you can see on slide 13, strong growth. Our revenue is $48.3 million. It was strong and a little bit stronger than we would have thought, driven particularly by our North American operations, which in turn was driven by the performance of All Access Pass. As you can see in slide 1A of slide 14, company-wide All Access Pass subscription sales grew 16% in the first quarter. In addition to the All Access Pass subscription revenue actually recognized in the quarter, as we talked about and is shown in chart 1B of slide 14, we also achieved an extremely strong 55% growth in All Access Pass amounts invoiced. As I mentioned, even excluding a large government contract, growth in All Access Pass amounts invoiced was still a very strong 32%. As you know, most of the significant growth in All Access Pass amounts invoiced was not recognized in the quarter, but was added to the balance sheet as deferred revenue that will be recognized in future quarters, accelerating our results in those quarters. As noted previously, also these new invoice amounts included strong sales to new logos, a continued quarterly and latest 12 months revenue retention rate of greater than 90%, as you can see in 1C, a large number of All Access Pass expansions and, shown in 1D, a large volume of multiyear All Access Passes, which increased our unbilled deferred revenue, which of course will flow into sales in future quarters. All Access Pass add-on sales were also very strong in the first quarter. As we mentioned previously, our add-on services booking momentum, which is a lead indicator to actual add-on sales, returned to levels equal to the prior year as early as July, and our booking pace accelerated beyond that in August and through the first quarter and through December. This is resulting in a strong booking pace that's resulted also then in strong actual delivered revenue, where worldwide these services increased to $9 million, which was a bit above actually even that achieved pre-pandemic in last year's very strong first quarter, where we actually saw very significant growth of add-on sales compared to the prior year. Second, as you can see in slide 15, All Access Pass drove also strong gross margin growth again in the first quarter. Our gross margin percent was 75.3%. It's up 359 basis points from the 71.7% achieved in the first quarter of fiscal 2020 and up 275 basis for the latest 12 months. Our gross margin percentage for the enterprise division in the first quarter increased to 80.6%, compared to 75.3% in last year's first quarter, an increase of 530 basis points. Our SG&A was lower than last year. It came in at $32.7 million, which was $4.4 million lower than last year's first quarter. Finally, the combination of these factors resulted in Adjusted EBITDA, as we mentioned before, coming in at $3.7 million in the first quarter, compared to an expectation of between two and two and a half million, and just $1.3 million lower than in last year's very strong quarter, despite the slower recovery in our international operations. We mention again that we had strong invoice and multiyear sales in the first quarter. Because most of these sales were not recognized, it built up our balance of deferred revenue, which, as you can see in slide 16, our total balance of billed and unbilled deferred revenue increased to $97.4 million, reflecting growth of $14.7 million, or 18%, compared to our balance of $82.7 million at the end of last year's first quarter. As noted last quarter, I'll just note again, approaching $100 million of deferred revenue, billed and unbilled deferred revenue, is a big landmark for subscription businesses. This provides significant stability of and visibility into our future performance. This strong combination of factors, both reported sales, new bookings, balance sheet improvement, and increases in balance of deferred revenue, continues to drive our expectation that we will generate very high rates of growth in Adjusted EBITDA and cash flow in 2021 and on an ongoing basis. We've seen this before, we expect to generate Adjusted EBITDA of between $20 million and $22 million in fiscal 2021, and we're pleased to be off to a strong start toward this objective. Achieving $20 million-$22 million in Adjusted EBITDA would represent approximately a 50% increase in Adjusted EBITDA compared to the $14.4 million we achieved in 2020. Our target is to see Adjusted EBITDA then increase by approximately $10 million per year each year thereafter to approximately $30 million in 2022 to approximately $40 million in 2023. These targets reflect our expectation that we will achieve at least high single-digit revenue growth each year. Growth that's approximately $20 million per year revenue growth. On average, approximately 50% of that amount of growth in revenue will flow through to increases in Adjusted EBITDA and cash flow, reflecting our high gross margin, strong gross margins, and variable selling costs. We fully expect to achieve an Adjusted EBITDA to sales margin of 20% in the coming years and really to become a billion-dollar market cap company in the coming years, even at an Adjusted EBITDA multiple that's conservative relative to our Adjusted EBITDA growth rate and without relying on multiples of revenue, which we should increasingly be able to garner. Looking forward, I'd now like to address the three factors that we expect to drive us toward the achievement of these strong objectives and of our being a consistently, we hope and expect, high Adjusted EBITDA growth, high cash flow growth company. On the navigation slide, in 18, those three points are the three drivers. Growth driver number one is the strength of the All Access Pass economic engine, which we talked about. Growth driver number two is that we're making significant ongoing investments in areas that our customers value most and in which we already have significant competitive advantages. Third is actually the strength of our organization and leadership and our teams throughout the world. Shown in slide 19, growth driver number one is the strength of the All Access Pass economic engine. In slide 20, you see the All Access Pass and related sales have driven the vast majority of our growth in revenue and Adjusted EBITDA over the past five years. As you can see, since 2015, annual All Access Pass and related sales have grown from really nothing to more than $90 million through fiscal year 2020, reflecting a huge compounded average growth rate and average absolute All Access Pass and related revenue growth of between $10 million and $20 million each year. This growth in All Access Pass and related sales has generated the vast majority of the total revenue growth for the company overall during these years, and in almost every individual year, more than offsetting the early runoff of our legacy facilitator and on-site businesses, which are now largely behind us with 84% of our revenue now in the enterprise division in North America coming from All Access Pass and related. Second, as you can see in slide 21, in the first quarter, company-wide All Access Pass subscription sales grew $2.3 million or 16% compared to the same period. For the latest 12 months, including nine months of the pandemic from March to November, All Access Pass subscription sales still grew 17% compared to the same nine-month period a year ago, or latest 12 months a year ago. As shown in chart 1A of slide 22, we've noted this, that All Access Pass sales grew, the add-on services grew, and that importantly, our amounts invoiced of new sales that are put on the books grew 55%, including a large government All Access Pass contract. Even excluding that, we still grew 32% or $3.4 million. The other thing about All Access Pass that's really driving it is shown in slide 23, that's compelling business model economics. As you can see, it's driving strong gross margins. Its high revenue retention is allowing us to reduce our operating SG&A as percentage of revenue, so it's reducing operating costs. That's giving us a high flow-through with a combination of strong gross margins and declining operating costs as a percentage of sales, is expected to allow approximately 50% of incremental revenue growth to flow through to increases in Adjusted EBITDA and cash flow. In terms of the visibility and predictability, the large and growing balance of billed and unbilled deferred revenue, which is approaching $100 million, as we talked about. Also the predictability of the All Access Pass' key operating metrics, including annual revenue retention of more than 90%. The fact that more than a third of All Access Pass holders are entering into multi-year contracts, and that our add-on services, which have now proven to be extremely durable, average 45%. All of this, we believe, gives us significant durability, visibility, and predictability. Growth driver number 2 is the ongoing investments we're making in areas where we're already strong. We're making significant investments behind the things that are our actually distinct and competitive advantages, and these are the things our customers value most. I might just say that All Access Pass is not just another typical, as we say, all-you-can-eat subscription service providing unlimited access to large amounts of undifferentiated skills content. Rather, All Access Pass is a subscription service, I'd say, with a punch. As illustrated in 25, really four powerful strategic punches. FranklinCovey has purposely and systematically built its strategic moat to establish best-in-class competitive moats in each of the following four areas that are important to our customers. As you can see in slide 26, moat number 1 is having the best-in-class solutions to our clients' highest impact, must-win opportunities and challenges. At any given time, most organizations have several high-impact opportunities which if achieved, or challenges which overcome, would have a significantly disproportionate positive impact on their organization's result. These opportunities and challenges include things like successfully and systematically implementing a new or refined strategy. Number 2, getting an entire organization to nimbly adjust to necessary change, as we've all had this past year. Third, achieving a major nonlinear operational breakthrough, such as increasing sales performance or improving customer experience. 4, establishing the foundation for a winning and engaging culture. 5, developing leaders at all levels, leaders who, as Eisenhower suggested, get people to want to do the things that must be done. While the rewards for achieving organizational breakthroughs in these areas can be truly significant, even great organizations often struggle to consistently address and achieve them. These are challenges which can't be solved just by letting people search through a content library and pick topics interesting to them. Rather, achieving breakthroughs in these areas requires collective organizational and behavioral change. At scale. When you step back from this, you recognize that there are certain things like strategic consulting that can have a big impact. They're just not very scalable, and it doesn't get behavioral change. You've got other things that are really scalable, where you can have lots of people take courses, but it doesn't have much impact. Where we're playing is at the intersection of those two is high impact with high scalability. These are exactly the kinds of high-impact challenges on which FranklinCovey has focused its solution development efforts and budgets for more than a decade. As a result, we now have the acknowledged best-in-class blockbuster solutions for addressing exactly these kinds of blockbuster challenges. As you can see in slide 25, some of those solutions. As you can see in slide 27, our best-in-class solutions include a bunch of great solutions, including The 4 Disciplines of Execution, The Speed of Trust, The 4 Essential Roles of Leaders, Multipliers, and a wide variety of other offerings, including our two most recent best-selling solutions, The Six Critical Practices for Leading a Team and Overcoming Unconscious Bias to Unleash Potential. Of course, these are in addition to our historical strong things, solutions like Leader in Me in education and The 7 Habits of Highly Effective People, both of which continue to set all-time usage records, even though they're now a minority of our offerings. Even with this very strong collection of best-in-class solutions, we're making ongoing investments in new content and solutions, including a new change management solution, new leadership offerings. Let me just refer to in. It looks like we've got a numbering problem in one of these slides. We're also, the flexibility, as you can see in slide 27, is also a big competitive moat for us, because having best-in-class solutions for our clients' biggest opportunities and toughest problems is critical. However, they've also got to be able to build to deliver that and access it flexibly. We've made significant ongoing investments in technology portals, digital learning assessments, micro-learning coaching, and the latest instructional design investments. Sorry. We've now got flexibility across a wide variety of modalities, including digital, micro-learning, live online, live on-site coaching, or any combination thereof in almost any segment of time, as you see on slide 27, on any device in more than 20 languages worldwide, with digital live online or live coaching and other services available to support them. As a result, again, as shown on slide 30, All Access Pass related sales have jumped as a result. They've increased from zero to more than $90 million. Latest 12 months for revenue retention has been high at more than 90%. More than 35% of Pass-selling clients are signing multi-year contracts. Our average Pass size has grown from $29,800 to $40,000 in the latest 12 months. Again, our balance of billed deferred revenue is really significant. Maybe looking at slide 31, which is the third puzzle piece. You can see in slide 32, FranklinCovey has built a direct sales force of 247 client partners or sales associates in the U.S. and Canada, and in China, Japan, Australia, and in the U.K., Ireland, Germany, Austria, and Switzerland. In addition, we expect to add 20 net new client partners this fiscal year to the 247 client partners we had at the end of Q1. Paul, let me turn the time to you to maybe talk about also the licensee network that we've built and the other strategic moats that we have. Sure. Thanks. Thanks, Bob, and good afternoon, everyone. As you look there on slide 33, in addition to a growing number of client partners who are continuing to ramp at or above our expectations, which they in of themselves represent a great revenue driver for us as a company. On slide 33, we've also built a network of approximately 80 international licensee partner offices, which cover most of the countries in the world. These partner offices generate gross revenues of approximately $50 million, and they pay FranklinCovey a royalty that's equal to about 15% of these revenues. These licensee partner offices are strategically very important to us. Not only do they work to penetrate their local markets, but they also provide services to global clients with local offices. This allows, for example, a global client in Germany who buys an All Access Pass to roll out that solution in many countries around the world and have access to All Access support resources in just about any country that they might be operating in. As shown in Slide 34, the fourth strategic moat is the power, reach, and influence of FranklinCovey's industry-leading thought leadership. Our years of investment in research and development and our thought leadership partnerships not only result in solutions that provide enormous value for clients. They create a large treasure trove of research and case studies that we use to broaden our thought leadership. As shown in slide 35, FranklinCovey and its key thought leaders publish what often become bestsellers, which present the principles and solutions that help our clients. Our key thought leaders in each solution area also write white papers and articles. They contribute to publications. They deliver podcasts and webinars, and they speak at some of the world's most influential events. FranklinCovey's industry-leading thought leadership includes bestselling books as well. To date, we've sold more than 50 million copies of books worldwide in over 50 languages. To put that 50 million number in perspective, the number of books that we've sold as part of our thought leadership strategy is greater than the amount sold by a large number of our top competitors combined. To achieve bestseller status, a book typically needs to sell a little over 250,000 copies, so to reach 50 million copies sold and still counting is unprecedented in the industry. These books typically achieve bestseller status, not only in the U.S. and Canada, but also in other countries throughout the world. In addition, our practice and thought leaders regularly publish articles and podcasts in a variety of publications and outlets and speak at client events and on the World Business Forum stage. This strong thought leadership helps to establish our position as a partner of choice for organizations that are truly seeking best-in-class solutions around the world and at scale. Bob, I'll turn back to you to talk about growth driver number three. Okay. In fact, Paul, why don't you just go ahead and talk about the strength of our organization, most of these people- Okay coming up through you. Okay, great. If you see the navigation slide there, 36. Speaking about the strength of our organization, this is really kind of our third growth driver. Ours is a culture where our leaders are experienced and trusted. Our processes are disciplined and strong, and our team members are really highly engaged. Most organizations correctly attribute their success to the strength of their people, and they're correct in doing so. However, with the opportunity of having a front-row seat deep inside the operations of thousands of organizations with whom we work, we know that FranklinCovey's organization, our leaders and processes, and our culture are extremely strong. In fact, they're among the strongest that we see. As to our leaders being highly trusted, in our recent annual employee engagement and culture survey, all of Franklin Covey's associates were asked to rate on a zero to 10 scale, with 10 being the highest, how likely they would be to recommend their leader or manager as someone to work for. You can see on slide 37, 94% rated their leader a seven or above, and 83% rated their leader a nine or a 10 on that question. This, even in the middle of the pandemic, when leaders were being stretched and required to deal with a number of additional challenges. As to our processes being strong, we do a lot of work with organizations, as I mentioned earlier, helping them institutionalize their ability to execute on their key priorities. We know that every organization has pockets of great performance. We know that every organization has variability in that performance. What differentiates the great performers from lesser performers is the extent of that variability. You can see a little diagram of this in slide 38. Top performers' performance distribution curve is simply righter and tighter than that of their lesser-performing counterparts. In other words, on average, their performance is better, and there is less variability among their units. This institutionalization of great results requires strong and consistent processes. We've implemented these same strong execution processes throughout our own operations. We use The 4 Disciplines of Execution as an example, and we're pleased that as a result of our strong leaders and strong processes, our leaders' performance distribution curve is very right and tight. Illustrative of their strong execution is that as shown, you'll see on slide 39. In the first quarter, 12 of our 15 managing directors, so each country has a managing director. In the United States and Canada, we have 10, and they lead our great sales teams. 12 of our 15 managing directors met or exceeded their quarterly revenue objective in Q1. The other three leaders who missed their goal missed by an aggregate of only 1.3% of the total direct office sales goal. Collectively, the group, all 15, exceeded their revenue goal. In addition, as you can see there on the right of this slide, 14 of the 15 managing directors met their EBITDA goal, with the one who missed, missing by only $50,000. Collectively, of course, this group exceeded. They actually exceeded EBITDA by about $1 million collectively. Finally, to the engagement of our associates around the world, as shown in slide 40, again, on this same recent culture survey that we conducted. Franklin Covey associates were asked to rate on a zero to 10, with 10 being the highest, again, how likely they would be to recommend Franklin Covey as a great place to work, somewhere that they would want to invite their friends and people that they know to come in and join. We're pleased that 92% of employees gave a rating of seven or higher, and 69% gave a rating of a nine or a 10. We have just a phenomenal group of associates around the world. We're so grateful for their efforts. They are tireless workers, and not only do they bring a tremendous amount of energy and passion, this is a group that executes very well, and I think you see that in the results that we've talked about today. Bob, I'll turn to you for any comments, I think you want to move on to guidance probably. Yep. Thanks, Paul. Stepping back from it, we all wish we weren't in the pandemic, but we're grateful pandemic has proven that the audit solutions that we have are really valued by our clients. The business model and subscription version of this has been extremely strong and positive. Our teams, who could have just hunkered down in the tents with the avalanches coming down on them, didn't. They got out of their tents and started climbing back up, and they regained traction very quickly. We're really pleased and grateful to be where we are with strong people, strong teams, strong offerings, the financial resources to continue to make good investments, and significant liquidity to cushion us. With that, I'd like to ask Steve Young to review our outlook and guidance. Steve? Thank you, Bob and Paul. I enjoyed hearing about the business and I'm also very excited about where we are and the direction that we're going. Pleased to talk a little bit about guidance and targets. Our guidance for FY 2021, as discussed last quarter, is that we expect to generate Adjusted EBITDA of between $20 million and $22 million. This result would be an approximately 50% increase in Adjusted EBITDA compared to the $14.3 million of Adjusted EBITDA achieved last year. This expected growth reflects everything that Bob and Paul have talked about, including the continued strong performance of our North America operations, our All Access Pass, and other things. Underpinning this guidance for the year are the following expectations that we talked about last quarter and are consistent with our first quarter results. First, the recognition to sales during FY 2021 of more than $60.6 million of deferred revenue already on the balance sheet at the end of last year, and the recognition of a portion of the $39.6 million of unbilled deferred revenue, which we had contracted. These balances provided and provide significant visibility into our revenue and gross margin for FY 2021. Second, in addition to the recognition of deferred revenue, the factor which is expected to have the greatest impact on our FY 2021 result is also a factor in which we have high confidence. That is the strength of All Access Pass and related sales. We expect that All Access Pass will continue to achieve strong growth in both sales and invoiced amounts, will achieve high revenue retention rates, strong sales of new logos, and continued growth in pass expansion and multiyear contracts. We also expect that All Access Pass add-on sales will continue to be strong. Driven by this, in FY 2021, we expect our operations in the U.S. and Canada, including government, to achieve an Adjusted EBITDA contribution level higher than in FY 2019, and even somewhat higher than we had originally expected to achieve in FY 2020. The third underpinning of our guidance, we expect that our revenue in Japan, China, and among our licensees will continue to strengthen. The increase in All Access Pass, which we expect to achieve in these countries, will of course, result in a portion of the new sales being added to the balance sheet as deferred revenue. The fourth underpinning of guidance is in Education. We expect to continue to achieve strong retention of both schools and revenue among existing Leader in Me schools. In addition, despite the fact that we could continue to be in a challenging and budget-constrained environment for Education in the remainder of FY 2021, we still expect to achieve growth in the number of new Leader in Me schools that we add this year compared to the number we added last year. Affirming our annual guidance and feel comfortable with that. For our second quarter of this year, we expect that Adjusted EBITDA will be between $1 million and $1.5 million, compared to $4.1 million in Adjusted EBITDA in last year's very strong second quarter, and still reflecting the expected strong performance of All Access Pass in the U.S., Canada, and government, and the same general expectations just outlined for international operations and Education. Please remember that last quarter we did say we expected Q2 this year to be less than the very strong Q2 last year. Please also remember that our second quarter's typically been the lowest Adjusted EBITDA quarter of the year, due primarily to the holiday season. Please also remember that even $1 million of Adjusted EBITDA in Q2 would be more than the second quarter result in FY 2018 or the second quarter result in FY 2019. Our second quarter result last year was just a very strong second quarter, representing the momentum that we had and talked about at the time, and are beginning to see again. That's guidance. Now, just a couple of thoughts related to general targets for the coming years and repeating a lot of what Bob said. The building on our $20 million-$22 million of Adjusted EBITDA we expect to achieve this year and driven substantially by the expected continued growth in All Access Pass. Our target is to have Adjusted EBITDA increase by around $10 million per year to around $30 million in FY 2022 and around $40 million in FY 2023. These targets reflect our expectation of being able to achieve, as Bob talked about, high single-digit revenue growth of around $20 million, 50% flow of that revenue to Adjusted EBITDA. Those are our targets. While changes in the world business outcome and many other factors could impact our expectation, we want to share these as our current internal targets and our assumptions and expectations. We also wanted to share, again, like we did last quarter, that in order for the executive team to receive full long-term incentive pay, we need to achieve those targets. That's our guidance and a few thoughts about coming years. Thank you, Bob. Thanks, Steve. With that, we just thank each of you and open this to questions. Thank you. We'll now begin the question and answer session. If you have a question, please press star then one on your touch-tone phone. If you wish to be removed from the queue, please press the pound sign or the hash key. If you're using a speakerphone, you may need to pick up the handset first before pressing the numbers. Once again, if you have a question, please press star then one on your touch-tone phone. Our first question comes from Andrew Nicholas from William Blair. Your line is open. Hi, good afternoon. Just wanted to start with the sequential strength in international sales this quarter. You talked a little bit about it in your prepared remarks, but I'm just curious if you could maybe flesh out the key drivers of the improvement versus last quarter a little bit further. Then maybe more specifically, want to understand how much of that rebound is a function of continuation of or a rebound in traditional product sales versus maybe some success expanding the reach of the All Access Pass product in those regions. Great. Thanks. Paul, would you like to address that? Paul, perhaps you can hear me or I'll start out. Sorry, I was talking into my mute button. Yeah. Thanks, Andrew, for the question. Sure. To the first part about just maybe adding a bit more color to the sequential growth from Q4 to Q1. The drivers of that, frankly, the main driver of that is just the increased stability in China and Japan. They were hit particularly hard earliest at the beginning of the pandemic. Things on the ground there have improved in those countries. People have gotten back to work, and our teams have done a nice job of filling the pipelines back up again. They were working on that in earnest back in our late Q2, Q3, Q4, and you're just kind of seeing the momentum build back into the business there. We expect to continue to see the business there build. In Q2 is our smallest quarter in that part of the world because of the holidays and because of the Chinese New Year. Revenues may not be exactly the levels. They'll be a little less than what they were this quarter, but on a percentage basis, I think you'll still continue to see the same sequential improvements, and certainly year-over-year as we move into Q2 here and into Q3. As far as how much of that's coming from traditional business versus All Access Pass. All Access Pass is coming online and Japan had a nice quarter with All Access Pass. China is just getting started. We're deep into that with them right now. That actually isn't driving yet the performance you're seeing because those sales, of course, are going on the balance sheet, and we'll begin recognizing those over the next nine to 12 months. A lot of that is traditional products that you're seeing reflected in the Q1 numbers. I think it is important to note that we are feeling quite good about the momentum around All Access Pass in those countries. Of course, we haven't mentioned much on this call, but in the U.K. and in Australia, we've been selling All Access Pass for years, and their results look much more like what we talk about in the U.S. and Canada in terms of subscription growth, add-on services growth, et cetera. I don't know, Andrew, if that's helpful or if you have any other questions there. No, that's helpful. Thank you. For my follow-up, I just wanted to ask about education and weakness in revenue this quarter. Any more color you can provide there on the drivers of the decline? What, if anything, is timing related there? Maybe any color on how the sales conversations have evolved over the past couple of months. I know it's a very fluid environment, so any more color on that business would be helpful. Thank you. Sure. Sean, thanks for this so much. Sean, would you like to address education? Yes. Thank you. Hi, Andrew. Sure. The sales in the quarter were down quite a bit, primarily for one reason. It's because a lot of our delivery days, coaching and delivery that we typically do a lot of in the first quarter, we just didn't do. It was down about over 50% delivery days. Coaching and consulting, because what happened is in September, October, November, you've got schools coming on with the pandemic. We just got a lot of schools saying, "We just don't have time right now. Please call us back in two or three months. We're trying to figure out busing schedules and lunches and going online," and then they kept changing. We found it very difficult to get to schools with our training and consulting. That was the biggest hit for the first quarter, so we couldn't recognize any revenue for those consulting and coaching days. Encouraging thing is that is rebounding. We were down over 50% in the first quarter. Right now we're tracking at about 17% down for the second, and it looks like it just keeps improving all the time. We're pleased with that. I think in general, regarding sales and how that's going, what we're pleased with is our retention is really good. We're way ahead of last year. We have over 615 schools that have committed to come on to renew their memberships compared to 450 last year. Even though we had a really good first quarter last year, in getting new schools up and going, this year, we're a little over last year after the first quarter in terms of the number of new schools that have committed to come on. We're encouraged with the retention numbers, the new schools. It's been the delivered days, coaching, and consulting days that have served us in the first quarter. A lot of these days are already contracted, and they will be recognized before the end of the year. They have to be, because it's just part of their contract, and we'll recognize the revenue for them. So a lot of it is timing. So- Yeah. Anyway. Bob, anything else you'd add? No, I think that last point is worth emphasizing, that with the decline in revenue being primarily related to the delivery of services, the vast majority of those services are under contract already, and you mentioned that, Sean. Yeah It's not lost revenue for the year. It will, in fact, come in. It just isn't recognized until either it's delivered or until the contract year ends. We will get that revenue. Is that helpful? Yeah. No, that makes sense. Yeah. That's part of why I asked. Yeah That was a good chunk of it. Yeah Thank you. It is Have a nice night. Thanks for the great questions. You too. Our next question comes from Jeff Martin from ROTH Capital Partners. Your line is open. Thanks. Good afternoon. Hey, Jeff. Hey. Hey, Jeff. Hi, hope you're doing well. I hope you are. First question is, with All Access Pass remaining, and if you include the unbilled, long-term deferred, you're growing in the upper teens, in terms of the growth rate. With the legacy business, I assume it's relatively stable at this point with its new level of proportion of the business. Just wondering to get your view on whether high single-digit growth rate for the overall business, if All Access Pass continues to grow at high teen rates, shouldn't we see the overall business grow a little bit faster than the upper single digits? Yes. Yeah. Thanks, Jeff. We should. I think what you've seen in North America, if you look at the booking pace for invoice sales over the last 6 quarters, pre-pandemic, it was higher than 10%, and it has been in recent quarters as well. I think ultimately, that top-line growth in the All Access Pass and related being high should ultimately, of course, pull the overall average up. For some years, as you noted, we've had offsetting that growth with some decline in the historic legacy business. That's now, as you pointed out, on the flatter part of that curve. As All Access Pass and related continues. Well, I think our point is that we think we can achieve $10 million a year of EBITDA growth if we only grow in the high single digits because of the 50% flow-through. To the extent we got higher revenue growth and your point is one that we obviously believe, that could be a bit better. Okay. That's helpful. Thanks for the insight there. The second question is on the content development. The thought leadership is clearly understood. Thanks for the details on that. Just curious, relative to, say, the last couple of years, what's your outlook or your level of optimism regarding your new content opportunities over the next couple of years? We think there are some really big ones. Because we're focusing on the challenges the organizations or our clients are facing, and because we're always talking to them, we have more than 100,000 hours of sales conversations last year with clients and more than 40,000 conversations from our implementation specialists. That really helps us hone in on exactly what they're looking for. We're very excited about two new offerings that we have coming out this year that we believe will hit things that our clients have needed. If they don't get it from us, they need to get it from somebody else. Given that they have an All Access Pass, they would love to just increase their spend with us and have those issues solved. We think actually that if you look back with all the things we've had historically, two of the biggest offerings in terms of usage are ones that have been introduced in the last couple of years. One, The Six Critical Practices for Leading a Team is around frontline leaders, and it really gives a set of very practical, useful skills and tools and mindsets around leaders and being a frontline leader. We're making another big investment in that content this year, but it's been a big one. The other one is Unconscious Bias, which we've been developing for years. It turned out, of course, this year, there's a particular emphasis on that, and it's been a good thing for the offering. It's been, I think, a good thing for our clients and for us, to really deepen the understanding of how you can systematically identify biases of all kinds and how you can unleash people's potential better. Those are two examples of ones that have come out in the recent years that are actually some of the strongest offerings that we have, and we believe these two new ones will be the same. We have a multi-year map of the things that we know our clients need, and staying on those things, we're pretty confident that we're scratching a big itch, so to speak, something that really is important and being responsive to their needs and their desire to do more with us within All Access Pass. Great. Thanks, Bob. Appreciate your insights. Thanks so much, Jeff. Your next question comes from Marco Rodriguez with Stonegate Capital. Your line is open. Hi, Marco. How are you? Thanks for taking my questions. Thank you. Wondering if maybe you can talk from a bit of a high level, just aside from any sort of coronavirus impacts that you might need to adjust to in the next few months or 12 months, can you maybe just talk about what are your strategic priorities that you're going to be focusing on here for the next 12 months-24 months? You bet. For us, maybe I'll start out and then ask Paul or Sean to add to it, priority number one for us is making sure that, just exactly the question Jeff just asked, that our offerings are really both hitting the topics most important to our clients, and that the flexibility and delivery and ability to access those offerings across the world easily, technologically, and every other way are really simple. We are making big ongoing investments in portal technologies, in user experience, in add-on services, in various formats, doing new formats of that, providing coaching through Janna, just on a weekly basis to follow things up. We've got new micro-learning investments that we're making. I think that's number one, is making sure that our map is really lined up with the needs of our clients, number one. Number two is building the sales force to support that. As large as our sales force has become, 250 up from 120 not very many years ago, we have a real opportunity to more than double that at 30 net new client partners per year. We'd be adding 150 new client partners to that existing count of 250 just over the next five years. There's a lot of focus on that and making sure that we're building the infrastructure, mentoring infrastructure, et cetera, to do that. I think the third is that we are looking to expand into some new content areas that aren't just the ones that our clients are looking for now or capabilities they may not have picked out on their own, but that we see being utilized in certain areas that we think will be good. I think two of them are product development. One is expansion. Paul, what would you add to that? I think those are exactly right, Bob. I would say maybe less strategic, but as kind of an operational big focus, we've talked about this a lot, you can imagine a day when our international direct operations, when the percentage of their business that's All Access Pass and related is like it is in North America, what the growth rates could look like. That continues to be a very big focus of ours, helping them. It won't all happen this year, but in the coming two or three years, having their All Access Pass business look like North America is a big focus. Got it. Understood. Lastly, just given your guys' expectations, it sounds like things are starting to turn around as they have been since last quarter. Your expectations for positive cash flows. You guys have a good-size amount of cash on the balance sheet. Just how are you guys thinking about that cash there and allocating it? I think we're thinking about it in two ways, Marco. First is that in that third priority that I discussed, we think there are some opportunities for some bolt-on small acquisitions that we'll use some of that cash for, that will enhance our abilities to serve clients and really extend our lead versus anyone else who's playing in our space in certain key areas. I think that will be a use of some of the cash, and it won't be large amounts. We expect to continue to generate cash flow that's really equivalent, more or less, to the Adjusted EBITDA. On top of what we have, if we add $20 and $30 and $40, we think that because most of what we're doing is developing in-house or acquiring through license, the capital intensity of our business just isn't very high. It isn't capital-intensive to add salespeople or to add new content, or even the technology investments are not that capital-intensive. As a result, we expect we will have, as we have in the past, where we've used $170 million of cash in the past year to repurchase shares, that we believe that, with this kind of growth rate in Adjusted EBITDA, that there'll be opportunities for us to see the value perhaps before certain other investors do, and to add a lot of additional value through the continued repurchase of shares. Got it. Thanks a lot, guys. I really appreciate the time. Thanks, Marco, very much for your great questions. This concludes the question and answer session. I'll now turn the call back over to Bob Whitman for final remarks. Well, with that, again, we just thank each of you for making the time to join us today. For the depth of your analysis and understanding, and we hope that this is helpful in terms of responding to questions. We really appreciate the focus you have on the business and the support over the years, and we feel good about where we're headed, and appreciate you being with us on this climb. Thanks very much. Thank you, ladies and gentlemen. This concludes today's conference. Thank you for participating. You may now disconnect.