Well, good morning, everyone, and thank you for joining us today for LKQ's 2022 Investor Day. I wanna welcome and thank those joining us here in Nashville and those joining us virtually, hopefully across the globe. My name's Joe Boutross, and I am the Vice President of Global Investor Relations for LKQ Corporation. We have a very robust day planned for you all. You know, one of the benefits of investor days, despite all the work that goes into them, it's a great opportunity for me to introduce the people that make it happen every day because I think at some point, you probably get tired of talking to the investor relations department. These are the people that make it happen. There's a lot of pride and a lot of effort that went into today's presentation. Before I move on to some housekeeping items, I wanna thank all those across the organization that had some input and some tremendous amount of effort that went into today's event. In particular, I would like to thank Lois Rostine, Chris Stigers, Adam Swartout, and my good friend, Maksim Mayarovich, gotta make sure I get his name correct, for stepping up and really managing key roles in all the components at play, as I said, planning today's event. Turning to slide two, I think most people in this room have read a forward-looking statement. I won't take your time reading it by line by line, but we know what that is. Now on to the agenda. The agenda speaks for itself. Nick's gonna be kicking us off, followed by our Wholesale North America business. Justin is the President of that operation, Rick Galloway. Some in here have had the opportunity to meet both of them. They're gonna kick us off. We're gonna introduce Mike Dufresne, who now is running our fourth operating segment, which we announced at the end of the first quarter during our earnings call. We will then take a break and fly over to Zug, Switzerland, where we'll have Arnd and Yanik Zoom in for our presentation today. Move on to Specialty, and then Bill Rogers will be speaking and Gary Mann. Gary Mann, I don't think has had the opportunity to talk to the investment community, so we're glad to have him here today. We'll move on to Varun Laroyia for a financial discussion. For those joining us here in Nashville, following the end of Q&A, we're gonna be hosting a luncheon out in the patio here, which will also include a product showcase and really provide the opportunity to meet some team members based here in Nashville in areas such as supply chain, vehicle procurement, HR, remanufacturing, industry relations, and many others. As I mentioned, it's really a great opportunity to interact with our teams, and we always like showing off the people that make it happen each and every day. LKQ is all about culture and teamwork, and I think today you'll truly get a sense of that. I do know that a few people had asked about guest Wi-Fi. We charge about $2.50. No, the website address is. Is it guestnet, Justin? I think. guestnet. The password is LKQ capitalized, small caps, the word delivers. Now you have access. Also, for the folks here in Nashville, it was in an announcement that Lois sent out. We have shuttles leaving at 1:30 P.M., 2:30 P.M., and 3:30 P.M. for those that need a ride to the airport. Of course, now on to the good stuff and let the festivities begin. As always, it's my pleasure to turn the kickoff of the presentation to Nick Zarcone, our president and chief executive officer. Nick. Thanks, Joe. Again, thank you to everyone who is joining us here today. For those who've made the trek to Nashville, we really appreciate the effort to get here. For all those who are listening either to the webcast or the audiocast, we certainly appreciate you freeing up several hours of your morning here to listen to the LKQ story. We have, as for those in the room can tell, transformed what is otherwise the Pit Stop Cafe into our soundstage here, and very happy to have everyone in person. I'm going to address a few kinda high-level topics and then really turn the podium over to the individuals who run each of our businesses to provide significantly more detail. Now, at an event like this, I know the audience always wants to hear 100% of everything going on at LKQ. The reality is we're too large, we're too big, we're too different across our businesses to hit 100% of everything. We're gonna focus on some key highlights that based on interaction with our shareholders over the last 18 months or so since our last investor day, we think are top of mind, but when we get to questions and answers, everything is fair game. Just keep that in mind. There are no aha moments or big reveals at this session. For those who are thinking that there may be a big announcement, there are no big announcements. What you're going to hear is really what we're focused on over the next several years to continue to drive the performance of our business. As Joe indicated, the most significant benefit of today, I think, for everyone in this room, is to see the next layer of leadership beyond myself and Varun. You can really get an appreciation of the talent that we have at LKQ, 'cause we think that is a key differentiator, is the depth and breadth of our leadership team. Having the opportunity to engage with them, not just through Q&A in their formal presentations, but, for those of you in the room, activities over lunch, we probably have another two dozen LKQ-ers who will be out there from across the organization. Use that as an opportunity to engage with our team. I'm highly confident that you will walk away even more impressed with the overall leadership team. I always start every presentation, whether it's for insiders or outsiders, with our mission statement, because this is why we come to work each and every day. All 46,000 of us across the globe come to work to fulfill this statement, and it's pretty simple. We wanna be the leading global value-added and sustainable distributor of vehicle parts and accessories. Now, we're 24 years old. That's a pretty big statement, I understand, but that's where we're headed. To do that and to get there are really three constituents that we need to serve each and every day. Our customers, the folks who are gonna pay us somewhere around the order of $13.5 billion for the parts we're gonna deliver at their shops, during 2022. Customers are always critical to any business, and we have them right in the sweet spot of our focus and attention. Importantly, and equally as important, are the 46,000 people who come to work at LKQ each and every day around the globe in some 32 different countries. Our people make the difference. Every time I get a group of employees together, I remind them that they are our most important asset. For those of you in the investment community, you know that 'cause your business is all about people, right? I always used to say the assets used to go up and down the elevator, right? The same is true at LKQ. We may not have elevators at most of our facilities, but our people make the difference, and we need to form really tight partnerships with our global workforce. Those 1,500 communities across the globe where we have a presence, we need to form a deep and long-lasting partnership with each of them. How are we going to be successful on our mission? Well, there's several reasons listed on the slide, which is slide 6 for those listening online. I'm gonna highlight three of them that I think are critical for us to truly be able to fulfill our mission. First is we have the broadest and deepest array of part types and the broadest geographic coverage of any publicly traded auto parts distributor on the planet. That depth and breadth of the inventory, the array of different part types, where we do our business is unmatched, and that makes us unique. Second, as a distributor, we have invested heavily in best-in-class inventory management and logistics capabilities 'cause at the end of the day, we buy product, we warehouse it, and we deliver it to our customers. The whole inventory management and logistics is critically important for us to be able to fulfill our promise to our customers across the globe. Lastly, we have leading market positions in almost everything we do and everywhere we do it. We have a really deep competitive moat, and our goal is to deepen and widen that moat in everything that we do in the future, okay? We think we're in a unique position to do that in each of our businesses, and long term, we think that's going to create a lot of shareholder value. When I became CEO back in 2017, my very first board meeting, I set forth to my board kind of the key strategic pillars as to how we were gonna drive the business going forward. That hasn't changed. You've seen this, but I think it's worth reexamining, right? Four key elements. First, we want to grow our customer offering. Up from 1998 when we were founded to 2018, it was all about, you know, finding one more part to put on the truck, okay? There is significant value that we can create for our customers that has nothing to do just with parts. Again, that's critical of everything we do, but key value-added services is another way we can create value for our customers, and we've started to do that. You all know that we've built a business called Elitek Vehicle Services. We're actually gonna have a couple of Elitek vans out in the parking lot here during lunch for you to take a look at. This is the business where we are going into our customers' collision repair shops and helping them with the scanning, diagnostic work, and calibration to take all the newer vehicles that have technology on it and help them be in a position to get those vehicles back on the road. Because before the collision repair shop can hand the keys back to the customer, they need to ensure all that technology is working properly, okay? The reality is most of the 40,000 body shops in this country don't have the equipment, they don't have the technology, and they don't have the people to do that. That's what we're doing with our customers, is we're providing those services, those scanning, diagnostic, and calibration services, such that our customers can return the vehicles to their customers. The second element is to expand, and that's really a geographic footprint strategy. We've been doing that in Europe, as you know. In this time, in 2011, we had nothing in Europe, and now we're the largest distributor by a multiple of two or three in Europe. We're gonna continue to focus on geographic expansion in Europe and perhaps other areas. Third is we need to adapt. There's no doubt that the car park around the globe is evolving, and we need to evolve as well, whether it relates to connectivity, the advanced driver assistance systems or ADAS technology, obviously electric vehicles, fleet ownership. There's a whole myriad of things that over a long period of time are going to change in the car park, and we need to change right along with them. We've been doing some of that already. A year ago, we bought a company called Green Bean Battery. A couple months ago, we bought a second business called Bumblebee Batteries. Those two businesses are all about remanufacturing batteries in hybrid vehicles, nickel-metal hydride batteries. We're gonna take that technology ultimately to learn and to be a leader in the remanufacturing of lithium-ion batteries that are in BEVs or battery electric vehicles. That's something we're doing today that is really addressing an opportunity that's probably 8-10 years out. But we're making the strategy come alive today 'cause you can't wait until the opportunity is in front of you. You need to get out in front. As Wayne Gretzky used to say, you know, part of his success was based on not going to where the puck is but going to where the puck is going to be. That's exactly what we're trying to do. Lastly, we need to rationalize the asset base. Some of this is all about just productivity, but some of it is truly taking a really critical look at the assets that we own and asking the hard question that all of you want us to ask, "Is LKQ the best owner of that business?" We have sold some things over the past couple of years. In the first 20 years of our existence, we sold nothing, right? Most recently, back on the eighteenth of April, we sold the PGW automotive glass distribution business. You know, it was a very solid business, a good fundamental business, but we weren't the best owner. It had margins that were going to dilute our North American margins forever. It was a 10% margin business. It wasn't a 16%, 17%, or 18% margin business. It was never going to get there, so we made the decision to free up $360 million of capital that we can use to invest back in our business. There's no big divestitures on the roadmap right now, but rest assured, every year we're going and we will continue to take a really critical eye and ask the question when we look at our portfolio of activities across the globe, "Are we the best owner, and is it in the best interest of our shareholders to own the businesses that we own?" Grow, expand, adapt, and rationalize, I call it the gear forward strategy, and it's served us well today. You can see that they're not just words on the page. We are putting effort and talent and capital to work to make this come alive real-time. This is gonna continue to be the strategy moving forward. Now, again, from 1998 to 2018, most of you know LKQ was all about gathering best-in-class assets. We did a pretty good job of that, I think. The reality though is, starting in 2019, we did a major pivot point, and the pivot was to focus on operational excellence. I've had a number of people tell me that that's not what they expected from a recovering investment banker like myself, okay. The reality is what I've learned in my business career is you need to focus on what you need to focus on. Coming off a couple of rough quarters in early 2018, it was clear to me that LKQ needed to focus on operational excellence, and that's exactly what we've done over the last several years. We set four key priorities that everything within our organization evolves around and is focused on. It's not just at the corporate level. We've driven these priorities all the way down through the organization to the local operating level. It's not just about being big. Yes, we wanna grow, but we wanna grow profitably. The focus isn't just on adding revenue but adding profitable revenue, and it's about enhancing our margins. Ultimately, it's enhancing, you know, net income margins, but to do that, you need to enhance your operating margins, your EBITDA margins. It's hard to do that unless you enhance your gross margins, right? From top down, we're focused on enhancing our margins. For the first 20 years of the company's history, nobody at LKQ had ever paid a nickel, not a nickel, to generate cash. It was clear that we had a huge opportunity to become more efficient in how we create cash and manage and deploy our cash. The focus on free cash flow became a top priority. As I said earlier, you can't do any of this without the best talent in the industry. Augmenting the tremendous talent that we had acquired along the way with some fresh outside ideas and perspectives became a critical part of our focus and our priorities. Again, profitable revenue growth, enhancing margins, really accelerating free cash flow generation, and acquiring great talent are the four key priorities that we focused on starting in 2019. With that, we need to do a couple things. We needed to wrap our strategy, our incentive program, our capital allocation priorities, and our balance sheet. We needed to wrap those around the priorities, not the other way around, right? That's exactly what we have done. What's it given us? Well, we've got the highest margins in our North American and specialty businesses in the history of the company, our 24-year history. By far, the best margins. Our European team has generated over a 200 basis point improvement in margins since we started the One LKQ Europe program in late 2019. We have been generating over the last couple years, and will continuously into the future, be able to generate more than $1 billion of free cash flow that will fund our continued growth and allow us to return capital to our shareholders. We've repurchased over $1.8 billion worth of our stock. We've initiated a dividend of $1 a share, which is about a 2% yield. While doing all that, we have dramatically delevered the balance sheet. We've delevered the balance sheet, and we now, as of yesterday, have all three major rating agencies award us with an investment-grade credit rating. That is what the focus on operational excellence has done for LKQ over the last three years. I'll put that record up against any other public company, auto parts distributors or industrial distributors. We have focused our energy, and we have achieved real results that we believe will set LKQ apart, in the future and just continue to widen the competitive moat that we've built for our company. Now, over the last couple years, we've gotten a number of questions from investors about the whole incentive program. I wanted to take a few minutes and really summarize what's probably ten pages in our proxy statement down to a single page, right? Again, what I learned earlier in my business career was that if you really wanna affect change throughout an organization, you need to tie people's checkbooks to those changes. We needed to align what we were trying to achieve in terms of profitable revenue growth, better margins, better free cash flow, better returns on capital. We needed to tie people's compensation to those key priorities, else we were never gonna be successful. Up until 2018, everyone at LKQ, their annual bonus plan was all tied to earnings per share. 100% of compensation was tied to EPS. EPS is an important metric, make no mistake. There's ways you could drive EPS that had nothing to do with profitable revenue growth, enhanced margins, or better free cash flow, right? Starting in 2019 and today, we scrapped the EPS metric from our annual bonus plan, instead have a weighting that is focused on organic revenue growth. Not just total revenue growth, but organic revenue growth. Excuse me, EBITDA dollars or euros, as the case may be. EBITDA, absolute EBITDA margins and free cash flow. No one had ever been paid a nickel on cash flow up until 2019. It's amazing that when you compare free cash flow in 2018 to 2021, it was up threefold. That's not just serendipity. That's a direct cause and effect of paying people to generate cash and having them do exactly that. The long-term incentive plan, which looks at performance over a three-year period of time. Again, the old program was based on total revenue growth. Again, earnings per share, so we were doubling up the EPS component in both the short-term and the long-term program, and return on equity. We had more than a couple of shareholders suggest that maybe we could generate great payouts on the long-term program if we used debt-funded acquisitions to grow revenue and grow return on equity. We scrapped that. We went to a program that focused on long-term organic revenue growth, earnings per share, 'cause there earnings per share is important, and return on invested capital. Not just the equity capital, but the total capital of the organization. The other thing we did that was pretty significant is the old long-term incentive plan paid out 100% in cash. The current long-term program pays out 50% in cash and 50% in shares. To the extent that the share value goes up, the value of those payouts goes up, which is important. Most recently, over the last couple years, we've taken the cash portion of that long-term incentive plan, and we've attached a modifier that says that could go up or it can go down, the cash portion, based on the progress we're making on our ESG goals. Okay, so it's important if we wanna make progress on ESG. We need to pay people to make progress on ESG. We need to put the right incentive structure in place. There has been a wholesale shift as to how we have approached the compensation of our people, and that's not just for Varun and myself, okay? These metrics are true for everybody in the organization that gets paid a bonus. Now, plant manager in Topeka, Kansas, or in Tampa or in Tacoma, we can't generate and manage free cash flow at a operating unit basis because they have no control over when we pay our vendors. It wouldn't be fair. They have no control as to the inventory that's in their warehouse. That's all done centrally. They are the face to the customer. Even at the plant manager level, it's their EBITDA dollars, their EBITDA margin, and days sales outstanding 'cause they can collect those receivables and keep the receivables under control. Everybody, and we're talking thousands and thousands of people, get a bonus every year all tied to three key metrics. Then for everybody who's on the long-term incentive plan, we are all operating off of this exact same metrics. Myself, Varun, all the corporate executives, all the way down to the people in the field who are on the long-term incentive plan on the same metrics. We are making change. Now I talked about on an earlier slide that the car park is evolving in many different ways. There's two key trends that I mentioned. One would be very slow, and it is a very slow shift in the composition of the car park towards electric vehicles, okay? This is gonna take decades, not years. The other one is the ADAS technology. As you can see on the left side of this slide, the most important part on an EV is the battery. You can argue that the most important part on an internal combustion engine is the engine. On an EV, it's the battery. We are investing in battery technology to position ourselves to create new opportunities to grow our business as relates to battery technology. On the right side, you can see the increase in need for diagnostic and calibrations on cars. It's a marketplace that's gonna be growing at 7% a year. We have created the leading remote diagnostic and mobile diagnostic unit in the country. We're gonna continue to invest more dollars. At the end of the day, nobody is better positioned than LKQ, given our size, our access to capital, our access to talent, to create real value for shareholders out of these evolving trends. It's very easy to assume that these changes in the car park are headwinds. If you ask us here at LKQ, these are huge opportunities for us to further deepen and widen our competitive moat, 'cause our smaller competitors simply don't have the talent, they don't have the technology, they don't have the capital to address these evolving businesses. We're really excited. You're gonna hear more about this from both Justin and Arnd over the next few minutes. Everyone knows we started the business in 1998 in consolidating the auto salvage business, and today, we are the largest recycler of automobiles on the planet. Second place is miles behind us, and we're very proud of that. Last year, we processed almost 800,000 vehicles. What's amazing is almost none of the vehicle ends up in the landfill. Everything gets repurposed some way, somehow. In some ways, we are the ultimate circular economy company. We are the ultimate environmental company because we are taking, you know, masses of automobiles and repurposing them, not just by selling parts, but also all the remnants of the car. We are a natural ESG story. When we look at ESG, while this may be the tip of the spear, we're spending no time really focused on this, 'cause this is just part of our business. This is a given. Where have we decided to focus our time and energy from an ESG perspective? Well, no surprise, it's exactly aligned with our mission statement, and that is a really heavy emphasis on our people and on the communities in which we operate. First and foremost, the carbon footprint. No surprise. The reality is we have thousands of facilities and tens of thousands of delivery vehicles that are on the road every day. Our ability to reduce the carbon footprint is really focused on those two key asset bases, our facilities and our fleet. Our people are our most important asset, and employee engagement is critical to us as a company. We're spending a fair amount of time and attention focused on employee engagement, talent development, right? Diversity, equity, and inclusion. Those are all items focused on the 46,000 employees at LKQ. We need a sustainable supply chain. We manufacture almost nothing. We do some remanufacturing, and we've got a couple of businesses in our specialty group that truly manufacture a product. Most everything we do is we buy product from somebody else, and so we need to go back into the supply chain and make sure that our vendors are being sustainable as well. Then those communities, those 1,500 communities where we operate, we need to make sure we're being really good partners in supporting them where we can. After the presentation, I'll be happy to chat about, say, what we're doing in the Ukraine right now for our employees and the community in the Ukraine. Last week, we published our second annual corporate sustainability report. A couple key items that changed from our first report is we've set some hard targets on just a couple of items. First, as it relates to climate change and the carbon footprint. Our goal is to be carbon neutral by 2050, and we can't wait until 2040 to start that program. We have a target to have a 30% reduction in our carbon footprint by 2030. How are we gonna get there? By focusing on our facilities and focusing on our fleet. On the other side, employee engagement, as said, is critically important. We had our first-ever employee engagement survey in the history of the company in 2021. We didn't get to everybody across the globe. In 2022 we will. We had pretty good participation, but we think there's a direct correlation between the participation in the survey, 'cause it's optional for our employees, but there's a direct correlation between the participation in the survey and where employee engagement is. Our goal is to improve the participation rate in the survey and obviously to improve the engagement score. We have targets for 2030 and then longer-term targets as well. Those are the two key areas that we wanted to highlight out of the CSR report. Here are some statistics that are included in that report as well. Again, this is all largely coming out of our recycling and salvage operations. You know, recycling almost 4 million gallons of fuel, over 2 million gallons of oil. We sold 13.8 million used vehicle parts last year. That's 13.8 million parts that did not need to be manufactured, did not need to be packaged, did not need to be shipped from around the world, okay? That is a true positive impact on our planet. Obviously reduced our electric usage and saved, you know, thousands of tons of CO2. In closing, again, four key priorities. Nothing's changed. Nothing will change. But we have some key targets, right? You see on the slide from a growth perspective, when you take a look at all of our businesses, we think over the medium to long term, we can grow somewhere between 2% and 3%. Now, it's very important that all of you understand, we have stripped out the impact of inflation from that number. There's no inflation in that number, okay? This is just core growth, which we believe is basically 1% industry growth packaged together with 1%-2% in front of growth coming from market share gains, okay? I have no ability to predict what inflation's going to be a year or two or three from now. I've seen estimates suggesting that in 2023, inflation in the United States will run between 2%-3%. I'll take the over on that with anybody in the room, okay? We don't know how to project inflation. What we do know is we need to stay ahead of inflation. We need to be very aggressive on pricing. All of my leadership knows that if we fall behind on inflation, we will never catch up, okay? We're a humble distributor. We buy product, we put it in our warehouse, and we deliver it to our customers. There is no reason we should be caught holding the inflation bag. We have no intention of doing that. These growth numbers, it's important you understand, those exclude the impact of any material inflation. Obviously, inflation just continues to run at 8% or 9% in the US or 4%-5% in Europe. Our growth should be significantly higher than what's on this page. We do expect to get margin enhancement, 15-25 basis points every year by grinding it out. There's nothing fancy here. It's hard work, but that's what our operating leaders are great at, and they will continue to perform. Lastly, generating cash. We're very confident we can generate more than $1 billion of free cash flow, which after paying the dividend, gives us $700 million-$750 million of cash to invest in our businesses, to buy back shares. To create more value for our shareholders. Then lastly, you know, our goal is to be both a great company and a great stock. We don't think those are mutually exclusive. We think they actually go hand in hand, and our goal is to do just that, is to create a great company for our customers, for our employees, and for the communities in which we operate, and obviously to create value for all of our shareholders and that's what we're gonna stay incredibly focused on. That's the opening comments. I'm thrilled to turn the podium over to Justin Jude and Rick Galloway, who are gonna talk about our North American wholesale business. Thank you, Nick. As Nick said, my name is Justin Jude. I'm the president of our North American Wholesale operations. To my right is Rick Galloway, our CFO. He's kinda has a dual role. He's the CFO of my business as well as Mike Dufresne, which you'll get to hear from shortly. Rick and I are pleased to host you guys here in Nashville at the headquarters that supports our business, primarily because him and I didn't have to travel to the airport. I know you guys have flown here or traveled here. We do appreciate you coming in, and for those all virtual, thank you for joining in as well. On behalf of my 13,000 employees in 2021, we finished around $4.4 billion, so I wanna say on behalf of them, thank you once again for attending, and to my employees, thank you for the hard work that you guys did in 2021 as well. One thing always when I go to investor meetings, there's a lot of questions about North America. Are we only collision? Are we used, or what are we? I wanted to kinda talk about the four main areas, and some of this Nick covered, but the four main areas are, or products and services that we offer in North America. The first is aftermarket. We have become the leading aftermarket parts provider. Now, we have competition in every single market, but in the overall North America, Canada, and the US, I would say we are still on just the aftermarket side, 20x the next size of our closest competitor. Make no mistake, in every market we have competitors. Some markets, such as Dallas, we have a lot more competitors, L.A., less in some of the rural areas, but overall, we have a lot of competition there. We have become the leader in aftermarket collision parts, so hoods, fenders, headlights. We also provide consumables that shops need to refinish that vehicle, what they call PBE, paint, body, and equipment. That's primer paints and tapes and what have you. Where we started was on the recycled OEM side. As Nick talked about, overall, LKQ is the largest recycler of automotives, automotive vehicles in the U.S., or in the world actually. My business did about 240,000 vehicles last year. We typically buy the total loss vehicles from auctions, bring them in. These vehicles were running perfectly until they got in a wreck and totaled out, but we'll bring those vehicles in, detox them, so recover all the fluid out of those, and in some cases, take that fuel, filter it, and put it back in our delivery fleet to help us on the cost side. That's allowed us, with that number of vehicles, it's allowed us to become the number one provider of major mechanicals, so engines and transmissions on the used side. Last year alone, we sold 220,000 used engines and almost that many transmissions as well. That business is good 'cause we also have the collision piece of the used parts. When a car gets hit in the side, we still got doors on the opposite side, we got front left head, headlights, if it's hit in the right or what have you. We are able to procure mechanical parts off that vehicle and sell it, as well as collision side. The nice thing about my business as well is my friend Mike Dufresne, since we produce over 800,000 vehicles, we produce a lot of cores. In the remanufacturing world, core is king. Having the ability to choose the best core can produce the best remanufactured item. We entered into the remanufacturing space over a decade ago on engines and transmissions. We're also doing rear axles. We've started doing turbos, and as Nick mentioned, I'll cover a little bit more detail, reman hybrid batteries. You know, when you talk ESG, whether it's the used side or the remanufacture side, a lot of opportunity, especially not just from the environmental piece and the less disruption to the environment, but also from the supply chain issues that we've talked about, these two businesses haven't really been impacted. On the used side as well as the reman side, that's all domestically sourced typically. We have not had the struggles of supply chain on these two businesses, and they've done quite well during the supply chain issues. The other piece I'll talk about that Nick mentioned is our Elitek operation, our services. That's where we don't sell any parts, but we provide services. Once again, I'll cover that in a little bit more detail. As I mentioned, every space we play in today has competition, but no one has all the full breadth of North American wholesale, let alone the full breadth that we have globally. In North America, there may be some aftermarket people that dabble in reman or some used people that dabble in reman or some services that might dabble in aftermarket parts, but nobody that we compete with today has the full line of offering that we have. Not only do we have that breadth, but we've also got that scale to make sure we have the best leading class fill rates and the best leading class service levels across North America. The nice thing is it's all done in our fleet. We don't rely on third party to ship it to our customers. It's all handled internally. That scale that we have, we've been able to survive through the pandemic and actually do pretty well through the pandemic. Even through the supply chain, since we have a diverse offering in North America, we have seen some struggles on one product lines. We've been able to shift it and grow the revenue on another product line. That diversification that LKQ North America brings has been strong for us. That strength that we have on that coast to coast, so consistent quality of products, consistent quality of service levels, they all come at a competitive price to that OEM expensive piece. That scale that we have, the offerings that we have, allows us to build strong partnerships with the insurance carriers as well as the MSOs, 'cause they both rely on, as they get bigger, they rely on consistency. They don't like to call multiple different people across different locations or different markets. They like to have that consistent, and LKQ is the only one that provides that nationwide, coast-to-coast consistent coverage of fill rate, warranty, and quality products. MSOs are growing. There's no doubt. They're creating some more efficiencies in an industry that's already inefficient. When those MSOs grow and they win, LKQ wins, too, because once again, they rely more and more on that consistent supply chain of alternative parts, and LKQ always fits the bill for that. In 2020, Nick talked about this, but in 2020, we shared the shift that LKQ had really in 2018 on focusing on growth to focusing on profitable growth. Once again, as Nick mentioned, we changed it. Not only did we put budgets in place to make sure that happened, we changed the compensation to make sure they're motivated and incentivized to grow where we need it to grow. This is a slide that we shared in 2020, and Rick and I are gonna go through these four bullet points, the business focus, commercial, operational, and cash, to kind of give you an update of where we are and other things that we're doing on each one of these areas of focus. As Nick talked about our Elitek services business. You go back when we started looking at this industry, it was for two different reasons. One, a new revenue stream. With that ADAS technology coming in, it was very complex. Not only one year of one model to the next year was changing pretty quickly, but one brand to another brand is much, much different. Different processes for calibration, different tools, different training. We were seeing a shift of some of our body shops couldn't repair these vehicles. They could hang the fender, they could paint it, they couldn't do the calibration, or they couldn't do some of the other technical repairs that were needed. We saw some of those vehicles migrating into a dealership where we have a less chance of selling alternative parts. We doubled down on this space, bought a company called Elitek about three years ago, and so far, we are now in 55 different markets on the mobile side. How our business operates, we start with a remote piece, where we can sell a tool to a customer, remote into the car's computer and tell them, "Here's what's wrong with the vehicle. Here's what needs to be repaired." In some cases, they take that, and they go do the repair. In other cases, they can't, and we'll dispatch our mobile team in there to finish up the diagnostics work, physically do the technical repair that needs to happen, whether it's replacing modules, airbags, redoing wiring harnesses. Then after that vehicle's fully done and ready to be delivered to the customer, we'll do that calibration. We see as this ADAS technology continues to grow and expand and the complexity grows, there's more and more growth opportunities for our Elitek business, and it does generate a much higher EBITDA margins than our core business in North America. We see that as a great investment for us to continue as the car technology changes. It's a good opportunity for North America to be in that business. The other thing we're seeing on the change, as Nick talked about, is the EV world. We know combustion engines are gonna be migrating to EVs. Unlike EVs today, there is a lot more hybrid vehicles on the road in North America than there are EVs. They've been on the road for a lot longer, and they're having batteries fail. The nice thing about a hybrid is we can sell them a used or remanufactured engine as well as a remanufactured battery. We entered this space, as Nick said, about 12 months ago when we acquired Green Bean, where we not only remanufacture batteries, we actually go out to the customer, whether it's a business or a consumer, and do the installation. The big benefit of being in the reman business is, once again, having that core, having the best choice of core . Our business, between myself and Mike Dufresne's business, generates plenty of cores for us to get the best core to deliver the best quality remanufactured hybrid battery. We're beginning to work and invest on the research and development to make sure we can do the EV world as well. When the demand for EV failed batteries is there, LKQ will be ready to capitalize as well. I think you've heard a lot from me. I'm gonna now turn it over to you, Rick. All right. Very good. You know, one of the things that we've talked about a couple times, you heard it from Nick, you heard it from Justin, was this business focus of profitable growth with a really big focus on the profitability side and making sure that we're going in the right area. Obviously, the pandemic that we've all witnessed and experienced, along with the global supply chain issues have made it a little bit more difficult. What we're pleased to see is what our folks have delivered over and over again is constant improvement over and over, whether we're talking about how to deal with the COVID world or whether to deal with the supply chain world. One of the things that we were able to do is expand in 2021 12% more in our overall capacity for our salvage yards. What that allows us to do is say yes more often. When we're out there, and Justin mentioned it, this doesn't require anything coming in. We're sitting there sourcing it from the US, and then we're able to say yes more often as we expand that overall capacity. We are seeing demand come back. Really excited about demand coming back, but we also have this limited supply chain issue that we're going through that we think will probably, you know, happen for the rest of this year, and then we're gonna come back and recover on the aftermarket side. As we look at the overall profitability, it's important for us to take another thing into account, you know. Is this inflationary impact? We're all seeing the inflation. We're all talking about it. Nick just talked about it. One of the things that's important for us is, as a distributor, we don't believe we should be stuck holding the product inflation. We are able to push that off onto our customers. What we look at, and Justin's gonna talk about in a little bit, is we look at the overall productivity to offset some of our cost inflationary increases with labor or those kinda things. You can see, as we've been able to do that bottom chart on the bottom right of your screen, we're really pleased to see that this thing keeps improving, whether it's gross gross margin or EBITDA%, and looking at that overall profitability. We would tell you that strategy's working pretty well. Justin, if you wanna go to the next slide. The other thing that Nick kind of mentioned was on PGW. We are going into the business, and we are looking at all of our businesses and whether or not we're the best owner or not. What we're really pleased to see is PGW had really significant improvements over the last three years through productivity, delivery, sourcing, overall cost reductions, and the business continued to improve. It's a great business. However, the business is not synergistic with LKQ. It goes on a different truck, it goes to a different customer. As we looked at that business and we looked at the overall profitability, we weren't gonna be able to get it to the margins that we thought we should be able to make. Plus, we didn't think LKQ was the best owner. As Nick mentioned, back in April 18th, we announced and we closed the deal to divest PGW, and we'll continue to do that. That's some of the commitment we've made to all of you when we said, "Look, commercial actions, you know, we're gonna exit margin dilutive businesses, and we're gonna continue to look at that." The second thing that we've got is on our overall commitment and relationship with MSOs, as Justin was talking about. The relationship with our MSOs is very strong. We're able to go into our MSOs or our larger customers and say yes more often and get another part on the truck. As we look at our overall portfolio and what we're able to source, we look at our aftermarket. We've gone into PBE. When we started, we were really a part supplier. Now we kinda look at ourselves as a solution. We talk to our customers, we look at our customers, and we see what their issues are. One of the great examples is something like a headlight. A headlight now requires a module that goes into the headlight, and then calibration that goes on top of that. It's become a more complex repair. What we're able to do is, with the Elitek and the parts that we're able to provide, we can provide an overall solution for these locations to deliver the part and be able to calibrate that part back for the customer to be able to use the vehicle. Back to you, Justin. Yeah. As Rick talked about, we're deep in with the collision side, but I would say today we have less of my business is collision than it was last year, and next year it'll be even less. I mean, as we shift to these different business lines that we have, we're less and less reliant on the collision side. If we look at what happened in the collision market during the pandemic, obviously we saw a huge drop in demand, but then that also spurred a lot more working from home. Even though vehicle miles traveled has almost recovered to pre-pandemic, those types of miles that are traveled are completely different. Less congestion on the roads leads to less accidents with that working from home. In addition, we talked about ADAS. I mean, ADAS, the intent of that is to reduce accidents. We saw some slight reduction in accidents. Overall, through all these headwinds that we had, including the supply chain that Rick talked about, we were able to still grow revenue and grow our operating profitability. A lot of our competitors did not have that luxury. They had to downsize a lot more, whereas we expanded. We expanded from a profitable growth standpoint. We did it by a couple different ways. One, investing in the new businesses that we talked about. Also investing in the operational excellence piece. One piece, and really the business focus piece, was trying to get new business. When the supply chain constraints were happening, there was a lot of people in the industry that weren't buying from LKQ and started calling us again because, even though our fill rates may have come down, we're still much, much better off than our aftermarket competitors and our recycled competitors, and in some cases, even the OEs. We started gaining more of those customers calling. We needed a way to make sure we track it, not only to get that one-time sale, but to get more and more share of their wallet and keep that customer buying. About a year ago, we started investing into a CRM solution called Sales Assistant. LKQ collects a lot of data. Our sales team led this off to say, "How do we get that data? How do we formalize it to give our sales reps the best, highest probable opportunity for a sales call?" It isn't just calling a customer now and saying, "Hey, we see you're buying hoods and fenders, but you're not buying radiators. What can we do?" It's more real time of, "We see this order that you had for a headlight. In order for that headlight to get damaged, more than likely the fender was damaged, the bumper cover was damaged. We have them in stock right now. Here's the prices." We're turning those into sales immediately on a transactional base real time. We saw in Q1 a roughly 6% o r I'm sorry, last year, roughly 6% revenue lift just associated to the Sales Assistant tool. Right now we're in phase one. We haven't even deployed it across all of North America sales reps yet, but we have multiple phase coming to make sure that, once again, we arm our sales force team with the best information they can to make the best real-time decisions and long-term decisions when it comes to getting customer share of wallet. Other things we're doing, investing in on the operational excellence piece is leveraging the whole digital transformation. One piece I talked about in 2020 was us using AI when we bid on vehicles. For those that didn't listen in 2020, we were rolling out this AI on the salvage bidding process. We bid on roughly 3-4 million cars a year to get the best 250,000 cars that will bring us the best quality, the best margin opportunity. But when you bid on 3-4 million cars, it's costly, and it also runs a higher risk 'cause it's laborious to do that. We've invested into an AI technology to help streamline that process to not only minimize our costs, 'cause maybe we could bid on 5 million cars, expand that to even get the best 250,000 or 300,000 cars we need, but to do it cost effectively and to do it more accurately. We've seen a cost reduction occur through this, and we've also seen a gross margin improvement. The nice thing about AI, it has a machine learning piece that will continually get tuned up and refined to drive better and better results. Another piece that we're leveraging digital transformation to help us on the operational standpoint is looking at our network, our warehouses, our 4,000 delivery fleet. We have the largest scale operation in our industry by far, but it is complex. There's always risk of making changes to say, "Hey, what, you know, if we close this location or relocate it 10 miles or downsize or add more trucks or add more shuttles or what have you, what does that do from a customer service standpoint, fill rate? What does it do from a cost standpoint? What does it do from an inventory value standpoint?" That risk is something that we don't like to do physically, so we invested in a software system called LLamasoft, which we can create a digital twin of our network. Put in all the inputs, that tells us what happens with fill rates, what happens with inventory valuation, service levels, delivery times, and what have you, and we can run different scenarios through this digital twin to see what the results are to make sure that we're making the best choice. Overall, we're not fully deployed yet. We've already started to see some benefits as we begin the infancy of rolling this out. Once again, it'll allow us to look at leveraging the right trade working capital of inventory, ultimately trying to increase customer service levels for our customers, but then see if we can reduce our footprint or get it more and more optimized. The other piece of operational excellence that we're looking on is kinda helping to change our culture on a Lean Daily Management. A lot of our teams have always been very reactionary in some cases, versus proactive. New position that we hired this year was a VP of Lean Daily Management. He will create a team that will go kind of cross-functional through all the regions to make sure we're sharing the best practices, we're thinking outside the box, but ultimately driving down that daily behavior to problem solve and make sure that the fires that occur today don't even occur. At the same time, pushing safety as a you know one biggest thing that keeps Rick and I up isn't P&Ls, it's the safety of our employees. This whole process will help us continue to get better at the operational excellence as well as the safety piece. Rick? I think the other piece to close the business loop out is we have a strong focus, as we talked about this in 2020, whether it's the business focus, the commercial aspect, the operational, it really comes down to how much free cash flow are you generating. That is one thing that Nick mentioned, one thing that we're really highly focused on. One of the things that LKQ's able to do with the size that we have is further integrate with our customers. We can integrate with our systems, our systems with their systems. What we found is when we're going after this cash opportunity, there is a big opportunity within our AR cycle to link up with our customers and make sure that there's less questions, less past due. One of the things that we're really pleased of over the last couple of years, we've been able to increase our past dues from a 90% number percent current up to upper 90s consistently. Now we're sitting there working with our customers on a regular basis with things that are really value add within the business. Furthering that, we have the network optimization that's helping to drive our inventories down, and this lean daily management is overall take out the waste. Inventory essentially is a bit of waste. How do we get that number down? How do we control that number? We're able to do that through this lean daily process. One thing that's important to note is with the supply chain issues, we will see a little bit of an uptick on our aftermarket inventory as that starts to recover. Just to make sure that all of you are aware of that. Why don't I send it over to you to close it out? Thanks, Rick. Yeah, so in closing, I hope you guys see that the shift that North America's had or really the company's had in 2018 on expansion of margins, not just focusing on growth, has paid off. The results should speak for themselves in North America over a 400 basis points improvement in EBITDA. If we take all the different strategic investments that we have done and will continue to do, we look at the operational excellence piece and trying to be disciplined on cash management, we feel that sustainable improvements in revenue, just looking at volume, not taking into account inflation or price or what have you, is in that 2%-3% range. Now, in the last couple of years, as Nick talked about, we're a humble distributor, so when inflation happens, we pass it on, and we've done a great job of passing on to our customers. Depending what happens with inflation, obviously, there's upside in these numbers. But just looking at volume through share of gains and what have you, we see a 2%-3% growth over the next several years. In addition, a lot of the things we're doing from an operational excellence standpoint, whether it's going after lean daily management, more digital transformation to drive, make our teams better and more efficient, we see a 10-30 basis points improvement on average as well on EBITDA side. Once again, this will wrap up North America. On behalf of myself and Rick, thank you for the time this morning. I look forward to entertaining you guys out and during the lunch. Now, without further ado, I'm gonna introduce my friend, Mike Dufresne, that runs our self-serve business. Thank you, sir. Good morning. My name is Mike Dufresne, and I'm proud to present our LKQ Self Service segment. As you know, we made the decision in Q1 to break out our self-service business into its own reporting segment to help provide better visibility to the investment community. Over the next few minutes, I'd like to take this opportunity to help shed some light on all the work our team puts into this thriving business. Let me tell you a little bit about myself before I get into specifics about the business. As far as I can remember, I've always been an auto enthusiast. On my summer break from college, I decided to pursue my career, my hobby as a career, and purchased a salvage yard in 1983, recognizing there were opportunities in selling used auto parts. I learned the ins and outs of the trade, and the business eventually flourished. In 1998, I was LKQ's fifth acquisition. I've had the privilege of working in many of the businesses Justin just mentioned: full service, aftermarket, paint, and the APU retail business. In 2019, I was asked to take over the self-service business following the previous business leader's retirement. I couldn't be more excited to run this line of the business as it encompasses so much of what I've learned over my past 30 years in the industry. I'm proud to represent more than 1,650 employees of our LKQ self-service segment. Our business procures end-of-life vehicles from various sources, including the general public, auto shops, peddlers, and auctions, just to name a few. These vehicles tend to be a few years older compared to the full-service business. Our team processes these vehicles by extracting all the fluids to safely reuse, recycle, or properly dispose of where necessary, and promptly sets these vehicles in one of our 69 locations where customers can remove parts. We operate our yards as retail establishments, where the general public pays a nominal entrance fee to access our vehicles and gives them the opportunity to disassemble desired vehicle parts for purchase. Our team has developed an optimal procurement to crush process to help meet customers' needs and optimize our order to cash cycle of about 90 days. We are pleased to share in 2021, we achieved revenue of $787 million, with a margin of 22.3%. As you can see on the map, we have a strong presence in various areas of the country, but we also recognize there's ample opportunity for further expansion in many major cities. We're very pleased with our long history of recycling and our strong commitment to ESG. We procured and recycled 554,000 vehicles, over 1.2 million tires, and over 2.5 million gallons of fuel in 2021 alone. To help give you a picture of our competition, Schnitzer and Nucor have subsets of their business that compete directly with our self-service business. However, the majority of the industry is highly fragmented regionally. We've provided a few of the larger players on this slide. Between 2019 and 2021, we saw high volatility in the commodity markets, and thus our metals revenue ranged from 63%-73% of our total revenue. While we cannot control the volatility in the metals market, through our superior operating model, we have decreased our order to cash cycle to 90 days, thus minimizing the impact on metal volatility. The process time is important for us to more closely align vehicle procurement costs with the scrap metal market. I believe our team does this the best in the industry. What we do have more control over is our parts and service revenue, where I'm pleased to say we've seen a 3.8% compound annual growth over our last 3 years. Our team takes great pride in providing an outstanding customer experience, and thus the ability to continue to grow this part of the business is very exciting for us. People, process, customer offerings, and digital strategy. We do these things better than anyone in the industry. Our people have extensive industry knowledge, which allows us to obtain a better all-around customer experience and helps us drive significant standardization across the country through operational excellence. Our team is results-oriented, and our compensation structure is aligned with LKQ's focus on continued profitable growth. In addition, my team has deep roots in our local communities and has been awarded various recognitions across the country for our dedication to making our communities a better place to live. Disciplined process execution is critical in operating 69 facilities across the country. We've developed processes that allow us to have industry-leading yields on our cores and parts. Our breadth and depth of inventory is second to none. Our extensive geographical footprint is unmatched, and we're also able to provide a better customer experience through a superior parts guarantee program. One of our newer areas of focus is on our digital presence. Our customers range from someone wanting to sell us a vehicle to another person needing a taillight for their 15-year-old vehicle. One way we can better serve these customers is through enhancements in our digital presence. We are proud of the steps we've already taken with completion of our digital app, allowing customers to receive push notifications on vehicles of interest, communicating a listing of current vehicles, and communicating upcoming promotional sales. Now I'd like to take you through just two of our strategic initiatives to help you better understand some further opportunities we have in our business. The first is on centralized buying and dispatch, and the second will go into some detail on our digital strategy. As I mentioned, we are focused on both the purchase of the vehicles as well as the sale of parts. The first initiative surrounds search engine marketing and optimization. The way I think about these two items is, one, I'm paying for clicks, and two, organic growth from the website traffic. traffic. We've made various investments to help sellers understand we are interested in the vehicle they are selling and would like an opportunity to quote it at a fair price. When someone does a Google search to sell their junk car, our desire is for LKQ Self Service to come up first in that listing. By increasing this traffic, we'll be able to procure more vehicles directly from sellers and avoid any additional fees associated with purchases down the value chain. In addition, our research suggests that these marketing efforts help build trust and encourage return customers. Our objective is to be the most customer-focused business, and completing that purchase transaction is very important to us. One way we will be doing that is to utilize our central procurement team to dispatch an internal fleet to pick up the vehicle. Doing this will help eliminate inefficiencies using third-party towing agencies who are less reliable. In addition, we believe this will reduce our quote to pickup time by at least 50%. Having success in this initiative improves our cost structure, increases our speed of procurement, and delivers an overall improved customer experience. As an example of how we're continuing to innovate and enhance our industry, we've developed a digital strategy to help further differentiate us from our competition. We've spoken about the top two items in our previous slide, so let me expand a bit on the other four. Based on our customer demand data, we know there is the need for certain fast-moving parts that are being sold through online marketplaces throughout the country. Using this data, we're able to remove these parts to sell online prior to scrapping the vehicle, thus improving our profitability. We continue to improve our data collection and master data management, which help drive our last two strategic initiatives of improved pricing and vehicle valuation models. Our current pricing model lacks the level of detail needed to properly price items by interchange data and demand. The enhancements we are working on will help price based on market data demand and resulting in an increase in volumes and overall profitability. In addition, we are partnering with Justin's full service business to enhance our vehicle valuation process, allowing better precision on the vehicle procurement. We will combine our existing inventory with known customer demand to reflect the bid price more accurately and thereby win the right vehicles for our customers' needs. This is the power of LKQ, as we believe we are the only company in the industry that can provide this to our customers. As I conclude, I believe our self-service segment has the industry-leading operations with a significant focus on optimal order-to-cash cycle, all while driving a superior customer experience. As I mentioned earlier, our focus on operational excellence and standardization has created an operational hedge on commodities, converting procurement to cash between 30 and 90 days, thereby decreasing the impact of market fluctuations. Our exceptional people, combined with our LKQ proprietary data, is a catalyst for continued growth and profitability. Utilizing our digital strategy will help us better source vehicles and allow us to enhance our product offerings, resulting in a superior customer experience. Thank you for your time. Taking the mics. I don't think mine's on. Now we have two different mics. There we go. We're at break time. I think we all know what a break is. I do want to remind folks that have dialed into the webcast that we have a Q&A section, and feel free to submit questions and we'll try to get to them today as if possible. If not, the IR department will follow up accordingly after the Investor Day. Thank you. I think you clearly saw the passion, the industry knowledge, and the enthusiasm of the initial segments that presented today, and there's more good stuff to follow. Thanks. Break time. Our program will resume in five minutes. Five minutes. Thank you. Ladies and gentlemen, please find your seats. Our program will start in one minute. One minute. Well, that was a very quick break, and we are now moving on to our European business segment. We have the benefit of Arnd Franz and Yanik Cantieni, our CFO for the European business live stream from Zug, Switzerland. I think, you know, the results of the One LKQ Europe program speaks for themselves. Today you're gonna hear where do we go from here, and Arnd and Yanik. Thank you, Joe, and good day from our LKQ Europe head office in Zug, Switzerland. My name is Arnd Franz, CEO of LKQ Europe. With me is Yanik Cantieni, our European Chief Financial Officer, and Yanik will explain some of the details of our profitability improvement later on. Welcome to all the attendees, whether in Nashville or virtual, of the 2022 LKQ Investor Day, and welcome to our presentation here about LKQ Europe. We'll see Yanik in a few moments. Thank you. Thank you, Arnd. Today, LKQ is the largest independent European distributor of vehicle parts and accessories. With our 1,000 branches, we sell to more than 100,000 workshops across Europe multiple times a day. Over the past years, we have developed a resilient business that is generating industry-leading margins with high capital efficiency and attracts an attractive outlook for the long-term growth. Our teams are creating a seamless digital experience for our customers across multiple channels. With our used parts offering, remanufacturing capabilities, and our CO2 footprint strategy, we're also a leader in sustainability in the independent aftermarket. Let's take a look at LKQ Europe's footprint today. Together with LKQ's investment in Mekonomen in Scandinavia, we are present in 20 countries from Sicily to the polar circle. In 12 of these 20 markets, LKQ is the number one player. Our geographical expansion continues. In France, we are growing our distribution footprint with two new distribution centers in Paris and Nantes this year. Our assortment includes 900,000 centrally managed part numbers. Our 26,000 employees serve thousands of customers multiple times a day. More than 10,000 of them rely on workshop concepts provided and coordinated by LKQ. We are the leading distributor of automotive aftermarket parts for cars, commercial vans, and industrial vehicles in Europe. LKQ is a decade-long success story. Starting with the acquisition of Euro Car Parts in 2011 and its subsequent strong organic growth to become the market leader in the UK and Ireland, LKQ has acquired some of the best assets in the independent aftermarket in Europe. With the acquisition of Sator in Benelux and France, Rhiag in Italy and Switzerland and Central and Eastern Europe, and finally, Stahlgruber in 2018, we have become the leader in the market consolidation, taking the European independent aftermarket to the next level. Over the past two and a half years, with the One LKQ Europe program, we have invested in the integration of the acquired companies and have seen the first effects of a more productive and joint organization moving towards common best-in-class practices. At the same time, we keep the proximity to our customers and the entrepreneurial spirit that has been the key to success for our distribution platforms. We invest in our people, and we continue to drive operational excellence. On this slide, we can see the positive development of both revenue, EBITDA margin, and trade working capital as a result of the LKQ Europe program and the productivity measures implemented with it. Our EBITDA margin has reached a solid double-digit percentage, and our working capital performance has improved significantly. Although it is almost impossible to predict the political and economic environment with inflation and supply chain disruption, we feel comfortable that the team and the tools that we have will put us in place to deliver double-digit margins sustainably and also deliver a strong working capital performance in 2022. Yanik Cantieni will now explain some more examples of the actions we have deployed to secure our performance. Yanik? Thank you very much, Arnd. Our margin improvement is a result of our strong team focus on our procurement excellence initiatives, including our tendering actions and negotiations of pan-European prices with suppliers, which has contributed to $85 million between 2019 and 2021. This is equal to nearly 140 basis points of margin improvement. In addition, we've improved the quality of our revenue, we've looked at managing our product portfolio effectively, such as by reducing lines and focusing on product margin, and we've made great progress on expanding the penetration of the private label brand products in existing market, and we are introducing brands into new markets. Since 2019, we've grown our revenue of private label brands by nearly 20%, and these products are contributing favorably to our gross margin expansion. In addition, we've diversified other performing assets, such as the Starr Group or Telecom business and the Croatia business, further improving our EBITDA margin. Our teams are also working really hard to improve our trade working capital position by negotiating extended payment terms and by using our supply chain financing program. With these programs, we've been able to increase our accounts payable on inventory ratio, and this is continuously improving. The recent announcement that LKQ is considered investment grade will certainly provide us with even more power to improve this going forward. Again, our commitment to procurement and pricing excellence is very important, especially in the context of significant inflation, and we know that the tools and the disciplines we've built will make us successful in managing the inflation. Our efficiency and productivity initiatives are not isolated to logistics and branch network structure. We're also focusing on delivering high service levels to our customers, to both the internal and the external customers, which we are achieving by using new technologies and by continuously standardizing and improving our business processes. One of our key enabler to achieve this is a very close collaboration with our colleagues at the Shared Service Center located in Bangalore and at the Innovation Service Center located in Katowice, Poland, which we opened mid-2021. As of today, out of nearly 1,200 employees that are located at both locations, more than 435 employees are working with the European team, compared to 79 employees at the end of 2019. Here, we've made really good progress, and we continue building the talent pool in both locations. In fact, these locations are not only providing essential transactional and administrative support, but they are developing digital capabilities with a strong focus on providing innovative customer solutions. To continuously improve on productivity, we are streamlining our organization in Europe, and we've been able to increase our revenue per employee by 12% between 2019 and 2021. All in all, we are establishing a strong foundation based on which we are continuously improving our performance. Arnd, back to you, regarding then the operational excellence. Thank you, Yanik. Let's take a quick look at what's happening in the operational backbone of our company. Since 2019, we've of course made efforts to optimize our network. We have already taken significant steps in optimizing our footprint, and we've closed more than 100 of roughly 1,100 branches that we had in 2019, driving revenue per branch and demonstrating our ability to improve efficiency. We are focusing on some large and very efficient central distribution centers like the ones in Tamworth in the U.K. or Sulzbach-Rosenberg in Germany. At the moment, we are ramping up our new vertical facility in the Netherlands that will replace multiple other smaller distribution centers across the country. With the streamlining of our core logistic assets, we are also driving productivity with shop floor organization, but also with efficient automation. Software helps us to optimize our demand planning, our replenishment, and last mile transport to further reduce costs, reduce greenhouse gas emissions, and take customer satisfaction to the next level. With LKQ operational excellence, we will stay the leading player in Europe. Let's take a look now at our market environment. Our customer base will continue to grow. Even though some low vehicle production volumes in the recent years have reduced a little bit the longer term growth of vehicles on European roads, the total market volume will still be growing at around 1% per annum. We have seen the average age of vehicles increase for many years now, due to better technical specifications and initial quality build, but especially, there was a strong impact during COVID with lower vehicle production and people just hanging on to their vehicles. In the next years, the average age in Europe is going to grow substantially to more than 12 years on average. Even though we will see electric vehicles with some lower service requirements penetrating the market more and more, even in 2030, they will represent less than 10% of the market, with most of these younger vehicles serviced in OE dealerships. This, along with the change in distribution models of the vehicle manufacturers, will accelerate the decline of the number of OE dealership networks rapidly. After a reduction of 20% in the past 10 years, up to 50% of the remaining OE service points will disappear until 2030. A lot of their work will end up in independent garages, who will only be affected by electrification very late in the decade. All good news for LKQ and its investors. Let me quickly talk about the trends in European auto service, and therefore our focus areas. Connectivity will be more and more change, changing the way of customer interaction in the aftermarket. LKQ engaged with the major platforms that will provide data access to independent aftermarket services to connected vehicles. Electric vehicles will continuously penetrate the aging vehicle fleet. In the first quarter of 2022, more or less 10% of the newly registered vehicles in Europe were battery electric vehicles. More about this later. Driver assistance systems will help us to reduce accident rates and also collisions. The number of collisions will go down, but on the other hand, we will see more valuable parts that will be repaired on vehicles and overall lead to a positive outlook for our body shop customers. Digital interfaces and channels, LKQ digital solutions are providing solutions for wholesalers, workshops, and customers. Last but not least, shared mobility. A slow start in Europe so far, but certainly gaining importance over the next years. Fleets and intermediaries will gain in importance. What does this mean for the workshops? In the future, we expect more cross-functional and multi-brand repair driven by business with new customers, like fleets and intermediaries as insurances. They will require multi-brand workshops to qualify for the software and electrical powertrains that today are primarily prevalent in OE dealership shops. That's where LKQ comes in with our multiple programs preparing our workshop customers for business of the future with the necessary tools, equipment, but also qualification. For example, through our new LKQ Academy training concept. Let's come back to electrification. While many studies talk about how electric cars require less service and repair, the lithium battery, representing 40% of the value of the vehicle, will offer new growth opportunities in the independent aftermarket long term. Our studies, together with one of the leading technical universities in Europe, RWTH Aachen, has shown that 64% of today's batteries reach end of life, which is defined by 70% of the original nominal capacity after around 10-14 years. That is less than half than the life expectancy of the vehicle. This comes from the battery chemical deterioration in the cells, but also from defects in the cell structure and the modules, the battery management system or the cooling system. Again, opportunities for the independent aftermarket. Where? Independent aftermarket operators like LKQ will obviously not be involved in the production or assembly of traction batteries. With our European footprint, our last mile transportation, salvage remanufacturing capabilities, LKQ could become a valuable player in the circular economy for lithium batteries, especially in battery dismantling, testing and sorting, repair and remanufacturing. With more than 1 million batteries coming back every year in Europe by 2030, a sizable business opportunity, creating lower cost and more environmentally friendly solutions with LKQ competence. In summary, LKQ Europe is driving operational excellence with innovation, generating value and protecting us from negative inflation impacts with gross margin improvement through procurement and product management, strong revenue optimization tools, and a continuously growing share of LKQ product brands. With operational excellence in our logistics, branch network and back office, with seamless vertical integration of our digital customer solutions and attractive workshop concepts, with answers to the challenges of the future, our team is confident that we will be able to drive strong above market rate organic growth of 2.5%-3.5% per annum net of inflation. With the implementation of the One LKQ Europe program, and in spite of unforeseen market volatility, we believe in sustainable achievement of double-digit EBITDA margins and continued strong cash flow generation from LKQ's European operations. Thank you very much for following our LKQ Europe presentation. We look forward to your questions later. LKQ, keeping you moving. Morning. Everybody hear me? Okay, great. My name is Bill Rogers, and I'm here today with Gary Mann, and we're gonna run through the specialty segment. Happy to do so, and looking forward to questions and answers later in the day. I wanted to start off by saying we've grown significantly since 2019 and since being acquired by LKQ. Our growth rate on a reported revenue basis was 12.9% since 2019, and it's been the same since LKQ acquired us, and that recognizes the opportunity that we've had to grow by being part of the LKQ family. This has been accomplished by servicing our two core markets, which are the automotive aftermarket accessories space and the RV parts and accessories space. In both, we are the number one wholesale distribution business in the market. Our EBITDA has grown at an even faster rate, 18% since 2019, and 15.4% since being acquired by LKQ. The improvement in profitability is a result of a culture of productivity, a commitment to value-added services, a strong discipline regarding price, and through consistent priorities and growth-oriented strategic initiatives. Last year, in Q4, we entered into the marine space in a much more meaningful way through an acquisition of SeaWide. SeaWide was a large wholesale distribution business in the marine electronics area and a great addition for us to help us establish a base to grow in the marine market. Additionally, we added more premium brands to our vertically owned brands family, the largest of which is Warn Industries. It's important to show the core fundamentals of the business, which is the reason we are successful. We have a substantial logistics network that allows us to deliver our broad and largely independent customer base throughout the U.S. and Canada from a massive inventory position in both breadth and depth of product next day and with a capability regarding big and bulky type products that is especially hard to replicate. We have spent significant effort transforming the business from a manual, phone-based, customer support representative-oriented, and publication-based business to a digital operation. Our business-to-business system drives the large majority of our transactions, and the customer experience being a top priority for the business, we continue to add functionality and capability to it. This has helped us become more productive, improved timeliness and accuracy. Additionally, this digital transformation has helped us open the door to many new growth areas. One example is Interactive Garage. We partnered up with them to have this tool be a central part of both of our business-to-business systems and other programs like TurnKey eShop and Parts Via on the business-to-consumer end. To briefly explain, TurnKey eShop is our program to help customers develop a business selling site where all of the back-end inventory process, delivery systems are hardwired, our systems are hardwired into their solution. The sales from one site will not be significant, but when you think about the thousands of opportunities at some point that we may have, it'll certainly add up to meaningful business. Parts Via is our solution to full participation in the business-to-consumer channel. Because the program is all about helping out our brick-and-mortar independent customer base and having them participate in the online selling trends, this program does it with superior delivery, with an installation network that is the best of the best that is available out there, and with mobile scheduler tools that enable everything. This Interactive Garage tool is really a game changer and is unique in the marketplace. You can visualize what it looks like to have your vehicle accessorized, and there really is nothing like it out there. Marine is a top priority for us and a strategic growth platform, which we are just beginning to realize. We see the market size being slightly larger than the RV market. This provides us with a lot of runway to pursue over the next 3-5 years. We will use our standard M&A playbook to pursue all the growth opportunities. This includes customer expansion, product expansion, customer penetration, private label opportunities, OE warranty opportunities, et cetera, et cetera, things that we have been able to do the same on the RV side. We have a lot of upside potential, and we are in a great position to pursue these growth opportunities within the marine market space. Now I'm gonna turn it over to Gary to cover some other expansion opportunities. Thanks, Bill. One of the keys to continuously growing our business is to look at attractive adjacent market spaces. We certainly have a successful track record in doing just this. We started our penetration into the RV market organically, and then after a few acquisitions, we were the number one distributor within four years. Most recently, we made an organic push, as Bill mentioned, into the marine market, and then cemented ourselves as a real player just last year with the acquisition of SeaWide Marine. Our distribution network and delivery capabilities allows us to achieve a significant amount of synergies, and really gives us the ability to enter these markets, and achieve those synergies after we acquire a target as we fully integrate them into our network. In addition to that, our towing products provide a real entry point to the customer base in a lot of these adjacent market spaces. Powersports, e-bikes and PTVs are three attractive spaces that we have identified and will continue to assess. As you've heard from other, you know, operating segments, our strategy is also continues to be focused on driving profitable growth and strong cash flows. The keys to executing that strategy will include maintaining and growing our number one position in the core markets, which is the RV and the automotive space, continuing to penetrate and grow our position in the marine market, continuing to expand through M&A, and then also continuously enhancing our exceptional digital capabilities. Our efforts to focus on this strategy should yield around a 3%-4% annual organic growth rate, 10-20 basis points of EBITDA margin improvement each year as we focus on operational excellence and efficiencies, as well as maintaining our strong gross margins, and also maintaining the strong cash flow position that we currently have. I'm gonna turn it back to Bill to close it out. We're extremely fortunate to be running the LKQ Specialty business. We have a strong leadership position in the two main markets that we serve today, again, being the RV space and the automotive aftermarket. Soon to be three, with the marine space being the third. As you can see, we have many elements of the platform that are hard for others to duplicate, many fundamental market advantages that help us from an overall demand basis, and we have a very experienced and strong team driving what we think is a very practical but highly growth-oriented business strategy. With that, I'll turn it over to Varun for his piece. Thank you. Hi, good morning. A very warm welcome to everyone from our North America headquarters here in Nashville, Tennessee. I just took the latest count. We have well into triple-digit folks that are joining us through the webcast, and then obviously a really good set of folks joining us here in person in Nashville also. This is our fourth Investor Day presentation. Nick started the first one in 2016. We did a second one in 2018, and then in the depths of the pandemic in September of 2020, we went to a virtual format, and that was well received. As we thought about the every second year Investor Day presentation, and with the economies beginning to open up, it was a tremendous opportunity for us to pick up the best of both and actually have and host this hybrid Investor Day. We obviously have a number of folks from the buy side. Thank you for your support. We have a tremendous set of sell side analysts that are also here in person. We have a number of our leaders that work within the business here with us. Though there is one additional constituent that we don't really talk about very much that I would like to take the opportunity to acknowledge, and that is a very tight set of our lending partners. These are the individuals and their institutions that have helped develop LKQ to what LKQ is today. We had about 27 lending partners. At last count, we currently have 13, and they have stood through with us through periods of extreme volatility, never ever doubting as to what we said we would do, and we appreciate the support. As we've kinda gone from a high growth business with lots of transactions, they've been tremendous thought leader partners to myself as we have transitioned into a operating excellence mode also. So thank you very much. It is tremendously appreciated. As you all know, we have another 12-18 months of lot of hard work to essentially get our balance sheet also in line with an investment grade profile. That is the other set of constituents I certainly wanted to take an opportunity to acknowledge. We have our Investor Day every second year, and then in the alternate years is typically when we would host our lending partners, and this was an opportunity for us to combine the two events into one, and so there we go. That's the second piece I wanted to share this morning. The third one really is in the next 15-odd minutes, there are three key things that I'd like to share with everyone. The first really is our financial and operating priorities that we initiated about 4 years ago, and as to how they have stood strong through a period of extreme volatility. I'll give you numbers, I'll show you trends in terms of what we've been working through. Secondly, where capital allocation has been over the past few years and how we think about capital allocation on a go-forward basis. Finally, I will wrap it up with ensuring that everyone gets a good sense of the geographic diversity, the strength in market leadership of each of our four segments, coupled with resilient underlying markets and terrific execution, what really LKQ delivers every single day. Let's get on with that. The first slide is basically a quick financial snapshot. You know, if you think about revenues, despite we're going through an extreme period of COVID-induced conflict or COVID-induced inflationary pressures and volumes still being down across the board, our revenues are back to pre-pandemic levels. Our segment EBITDA is structurally above pre-pandemic levels, and we expect for it to continue to grow from this new level. Our net debt is a very manageable 1.3x. We have ample liquidity, and then as of yesterday afternoon, less than 24 hours ago, we are three for three with investment grade rating across all three ratings agencies. If you look at the geographic diversity of our business, about 56% of our business, 54% of our revenue is North America, essentially Canada and the United States. 44%, 46% in Europe. From a profitability perspective, about 2/3 of the EBITDA is North America-centric, though Europe is catching up fast also. If you think about the approach to our balance sheet and also our capital allocation, if you go back 2 years ago, that second line out there said, "Targeting investment grade rating." That has now been changed to, "We have achieved investment grade rating." We are not one of those investment grade tourists. We are there for the long term. That will stay. It's sustainable investment grade rating. The second one really is with the prodigious level of free cash flow that we have demonstrated and that we are committed to generating going forward, our ability to deploy it for the highest returns, which obviously drives total shareholder returns. That's the kinda key piece, sustainable investment grade rating and also driving total shareholder returns. If you think about the key pieces that Nick mentioned earlier this morning, it's the same, right? If you're talking about driving increased organic revenue growth and taking share from our competitors, we don't expect to do any major transactions. If you think about the substantial barriers to entry, we continue to widen the moat. From a consistent and profitable growth and cash flows, you see what that delivers. Strong net income coming through. Strong free cash flow coming through also. We really continue to deploy under operational excellence key programs such as the One LKQ Europe program, including the deployment of Oracle or Project EOS, as we've talked about. Shared services, Yanik gave you a quick heads-up in terms of how that's been coming through from a European perspective. We really also in terms of in North America as to how we are using artificial intelligence to make our salvage procurement processes more effective, more efficient, and really that is also driving a lot of benefit across the entire business. Capital allocation is to drive our valuation. If you think about it from a capital expenditure perspective, it is a moderate 2%-2.25% of revenue. We are steady on that perspective. We have the ability to flex during times of extreme volatility, but the ability to continue to invest through cycles, and I'll give you some examples of those also in the coming pages, that really is what sets LKQ apart from anyone of this size and scale within our industry. Share repurchases, I think people have you know become accustomed to that piece. In aggregate, from starting the program in October of 2018, in aggregate, $2.5 billion, the most recent being $500 million increase to the overall share repurchase program as of last month. Obviously we have initiated a regular quarterly dividend also. From a leverage perspective, just a conservative leverage philosophy, we don't expect ourselves to be above 2x. We are currently at 1.3x at the end of March, so 3/31/2022. Despite the fact with investment grade rating, we could go significantly higher, we're very comfortable with where we are and also from a target leverage perspective at about 2x. We have a tremendous amount of free cash which we can direct towards also growing the business on a profitable basis. Really the key takeaways are there for you right on the right-hand side panel of the slide, is strong, stable, market-leading, globally diversified business portfolio. A largely recession-resistant set of businesses, improving margins, strong free cash flow generation, disciplined future growth. Okay. It does not mean that our corporate development department has been disbanded. Far from that. There's a healthy pipeline, and we have ample firepower as and when needed to be able to take advantage as valuations finally come through from a COVID-related high. That also will come through, and we are in a wait and watch mode to see as to where we can deploy our capital to continue to grow the business on a profitable basis. The investment grade rating certainly provides us a lot more additional flexibility, but also enhances the overall valuation. A couple of years ago, I shared the resiliency of our underlying markets, and really what I've done is in the next couple of slides, I have fast-forwarded how the last few years have gone by. Really, if you think about whether it be the North America business, this is really stable U.S. vehicle miles traveled provides consistent demand for aftermarket auto parts. This is in trillions of miles. You can see what happened in 2000 and 2001, how it bounced back. We saw what happened, the Great Recession, bounced back and grew from there. In 2020 and 2021, while it is down, I think any of you that may have taken an Uber or have driven in your hometowns or coming in from Nashville Airport would have seen traffic is back, and that certainly is good for our business. Really the COVID-19 related stay-in-shelter triggered downturn in 2020, and the follow-on effects in 2021 triggered a unique and rare shock to underlying VMT, but we expect recovery similar to prior recessions. If you think about the European side of things, total vehicle kilometers traveled in Europe also show a similar set of patterns to what we have seen in the United States. Again, with the COVID-19 piece coming through, but over the long run, stable vehicle miles traveled and an aging car park, okay, certainly provide a steady demand for aftermarket auto parts. We feel good about the underlying resiliency of the business, at least in the industries that we operate in. This slide really captures what Nick mentioned up front with that maniacal focus on operational excellence. The last time we shared this, it was about six months into the pandemic in September of 2020. Let's fast-forward that entire timeline, 2019, 2020, 2021. Really on the left-hand side panel of this chart, you see what has happened from an organic parts and services revenue. 2019 was a time where we were essentially, I'd say, cleansing out certain loss-making contracts, whether it was in our glass business, whether it was in aircraft recycling, whether it was certain subscale markets geographically in Central Eastern Europe, which we essentially divested. Hence, that's perfectly fine. Again, it was not a growth at all costs. As we did our deep dives into the portfolio of businesses that we have, there were certain businesses that were not even paying their return on the capital that had been invested in those businesses. It was an opportune time to divest those. I will tell you more in terms of what we have been doing, really in terms of how we've been reshaping the business and the portfolio of businesses that we have. Think of it from a gross margin perspective. You know, from 2019 to 2021, gross margin is up 190 basis points. People may say, "Listen, that's all pricing actions and procurement excellence," for sure. Think of it from a segment EBITDA perspective. During that same period, segment EBITDA has gone from 10.6% to 13.6%. That's a 300 basis points increase. That delta between the 300 and the 190 on gross margin, that's the OpEx leverage. That's 110 basis points of leverage on a $13 billion business that we've been able to deliver and we continue to press hard on. It may not be the big, bright, shiny lights that we talk about, you know, with regards to some of the operating side of things. Whether in Justin's business, they're talking about Roadnet and as to how we're making sure that we're not getting to face the full brunt of the higher cost of oil at this point of time, we have reset certain expectations within the markets given where we are. Driving productivity, whether it be North America, whether it be in specialty, whether it be in self-service or in Europe, how our productivity is significantly above and we are holding onto it for as much, as we can. That is certainly working through also. Whether it be technology related to artificial intelligence and as to how we make our salvage procurement that much better, those are the kind of things that you see come through on the segment EBITDA line. That really adds to that 300 basis points that we've been able to deliver, and we continue to build from thereon. Free cash at $1 billion minimum. That's an expectation. It was interesting, a few months ago up on the virtual sessions, Nick and I were asked a question by someone fairly young and new to the business from a buy side perspective, you know, whether we had modeled out the sustainability of the $1 billion of free cash and whether we'd taken into account any black swan events. I initially thought it was a trick question till the time Nick kind of gave me a little nudge on my ribs, and we realized that, you know, we're actually going through a fairly dark period. You know, whether it be COVID-19 or whether it be the subsequent conflict related supply chain disruptions, all of those pieces. I think let's just say it was courteously and politely responded to. We feel good about the $1 billion of free cash. You think about net leverage, that has been delevering. You know, we feel good about where we are. I talked about that. Adjusted EPS from $2.37 in 2019 to just under $4, that's about $1.59 up, about 67% up. Now obviously, you know the guidance that we've given for 2022 at $3.95. Again, continuing to operate at that elevated level that we made a step change through operational excellence and really through the pandemic, getting it on a sustainable basis and really running at this new level of operational performance that people have come to expect and should come to expect from LKQ. The final piece at the bottom of this six-panel chart really is our return on invested capital. Nick had mentioned historically it was return on equity and total revenue on the long-term incentive plan, we changed that piece to return on invested capital. That is a far truer and better metric, we'd say, and it's more shareholder-friendly also. That is a true reflection of the strength of the business, and clearly have made a tremendous change on that front with a step change north of 15%, and we expect for ourselves to continue to operate at that, at 15, around the mid-teens level, in the go-forward basis. Three years of strong operational performance. You now see the results out there have delivered outstanding results and reliable performance. We've talked about the focus on free cash flow, and I just want to give a small, you know, history lesson in about three bullet points in terms of how that piece came about. Really look at the right-hand side of the chart. If you look at 2015, 2016, 2017, the business always generated free cash. It was kind of around the $350 million-$360 million on average. You see what the conversion ratios were. They were volatile conversion ratios from an EBITDA perspective. Q1 of 2022, we delivered what we used to deliver in one quarter or within one year, we delivered that in one quarter at $350 million Q1 of 2022. How did that piece come about? The first key piece really was deploying metrics across each of our businesses with key elements of trade working capital, namely inventory, so days inventory on hand, days payable outstanding, and then, you know, AR and past due AR. Something very, very simple that could be communicated so that we had all 45,000 shoulders pushing in the same direction, every oar pulling in the same direction, because as Nick mentioned, this has to go all the way down to the field and making sure folks had direct line of sight. That was the key piece, and that's really where we spent 2018 getting the foundational elements of operational excellence embedded into the business. We knew from a European perspective, we had a fantastic set of platforms, market-leading businesses, but each of them were running as disparate fragmented platforms in themselves. As a precursor to One LKQ Europe, what we did was we deployed, with the help of our lending partners, a cash pool. The income statement is what we drive from management team perspective, but the balance sheet, I believe, belongs to our stockholders. That is something that we have to make sure that we run it very, very judiciously on their behalf. We deployed a European cash pool, and we pulled out just under $100 million of excess capital that was stuck out there. Again, making sure that we had the right robust foundations. Then really the key defining piece was changing the incentive program for the first time in almost 20 years of the company's formation to continue to make this a sustainable piece on a go-forward basis. There are a few foundational steps that need to get in place before we could kind of do and really run this sustainably higher level. The other piece I think as everyone is aware, the single biggest opportunity that continues to remain, and Yanik also alluded to this, is with our European business. If you think about the nature of the product set that we distribute out there, very similar to what you see the big four here. Yes, it is a business to business. They have certain retail aspects to it, but we have certain internal targets. Let's just say there are a few hundred million dollars yet to go before we get to our internal benchmarks to be able to continue to push on that front. That goes in clearly with the investment grade rating now that we have three for three across all three ratings agencies. We certainly feel that that certainly supports a continued increase from a DPO perspective and also cash flow generation. A quick slide in terms of Fitch was the first ones last May of 2021, when they initiated coverage with investment grade rating. Last month, they reaffirmed that piece at BBB- with a stable outlook. S&P upgraded us in April, so about 2 months ago, you know, from two Bs to three Bs. As I mentioned, under 24 hours ago, Moody's also upgraded us. The issuer rating is investment grade, and then all the underlying debt also has been upgraded. Certainly, it's good to see validation coming from external third parties. What we've always said is we will continue to focus on the program that a handful of us spent many long days and nights, evenings and weekends in establishing, and it's really good to see the results of those pieces come through. This is one aspect of it only. As you think about the balance sheet at this point of time, and this is what I was sharing with all of you in the lead up, before we got into the formal comments, the overall balance sheet is pristine, and we feel good about the fact that it's prepped to sustain volatile markets. You see a large number out there for 2024, but that really is our credit facility which matures in January of 2024. As I've shared with our lending partners, expect that to decrease in size when we replace our existing facility in the next 12 months. What we will do is we will take that $3.15 billion credit facility that we currently have, and we will partially term it out and to really create ladders in the overall capital structure, essentially the way one would expect it to be for an investment grade profile business of our size and scale. We do not have any early call option on the 2024 bonds, so those will get redeemed as and when we think the markets are appropriate if we plan to do any early call, otherwise those are due in April 2024. The call window on the 2028s opens up in just under a year's time, and we'd certainly see what market conditions are. The plan really is to spread the maturities in future years and so review the balance sheet work is really what I mentioned. There's a substantial level of work that we need to do from that perspective, along with our lending partners and their debt capital markets side of things. Let's move on to capital allocation. Really on the left-hand side of the chart, you see what we've been doing from a capital allocation perspective in that pie chart. You see acquisitions have been about 4%. Very targeted, high synergy, tuck-in acquisitions. Really the bulk, almost 2/3 of the capital that's been deployed, you know, from an operating cash perspective, is in really getting our debt levels to a very comfortable level that I mentioned previously. Just under 40% of it has gone down towards the debt pay downs. Share repurchases have worked out tremendously well for our shareholders, so about 1/3 of it has gone toward share repurchases. Dividends really it will be annualized. That number will increase just because this really only captures two quarterly dividend payments. As you think of the regular quarterly dividend that we have initiated, that will obviously, you know, continue to grow. As our profitability grows on an adjusted net income basis, we would expect to grow our dividend also. As you think about the priorities for the next three years, you know, operating cash, we expect to continue to maintain that high level of conversion. Capital expenditures, it's a very stable level that we have. We do not see any major blips. It'll be in the 2%-2.25%. We have the ability to toggle specifically on the growth related CapEx in times when we have excess free cash that we believe we could accelerate certain pieces. As you probably recall, in the fourth quarter of 2021, we did accelerate certain aspects because, you know, with inflation upon us, we had to go and place orders for basics to kind of run our business with regards to forklift trucks and racking, and certain fleet, where we essentially kind of prepaid to ensure at least we would get on the queue, and we still would have to wait the better part of six months to get the vast majority of it. We did some of that. We certainly found certain opportunities to expand our ESG element with regards to, you know, salvage yards. A large yard was acquired in Colorado. Again, our ability to deploy cash during periods of extreme volatility, really investing through cycles. Acquisitions, as I mentioned, focused on high synergy tuck-ins, no large platforms expected. Share repurchases, it's a steady number. As Nick mentioned, $1 billion of free cash, take out the dividend, and there's still the better part of, you know, $700+ million of our ability to really toggle between certain acquisitions that are gonna grow our business on a profitable basis and bring EBITDA associated with it, or the safety valve really becomes in terms of share repurchases. We have a plan in place. We have adequate capacity within the plan also. Then really from a dividends perspective, you know, similar to what we have been paying for the last two quarters, in fact, tomorrow is the third quarterly dividend, which gets paid out on the second of June. That's running at about 2% of yield. When it was initiated, it was slightly lower than that, but essentially $1 a share is really what we have, and the commitment really is to grow it as adjusted net income continues to grow. Future cash flow opportunities will be allocated to the highest return opportunities across organic investments, tuck-in acquisitions, share repurchases, and ensuring that there's further shareholder return through a regular quarterly dividend. Okay. This was a slide I was talking about as to how we've been morphing our overall portfolio of businesses. On the top left-hand side, Justin gave you an insight in terms of what we've been doing with regards to targeting critical capabilities. Think about the Green Bean Battery and Bumblebee Batteries acquisitions. It gets us a ticket into the fun fair of EVs and nickel hydride battery recycling. We now play in that market, and it was a natural adjacency for us because we had salvage vehicles that we were selling the cores, specifically for the hybrid batteries, to certain customers. When the opportunity came for us to vertically integrate those pieces, it was a low risk investment because we knew the businesses, we understood the margin profile, and we knew what more we could do with them. Elitek Vehicle Services, another piece which the North America team called out, again, from a standing start of nothing about three years ago, it is the market leading diagnostic and calibration services business across North America, serving over 60 markets in person, and then obviously with the remote diagnostic capabilities, being able to have an even broader coverage. I talked about certain high return capital projects to continue to make the moat deeper across our business. The Benelux Central Distribution Center, highly automated, advanced logistics distribution center, similar to what we have at Sulzbach-Rosenberg, serving the Stahlgruber business or for that matter, Tamworth or T2, as we formally call it, serving our UK and Republic of Ireland markets. This is the third in our portfolio with future-proofing the business. This essentially takes out four manual distribution centers and replaces them with one heavily automated business. We talk about talent, and we talk about labor inflation, we talk about minimum wages. In Europe, as we know, there's a concept of a living wage, and this essentially allows us to drop in capital, create a deeper moat around our business because we know none of our competitors have the ability to set one up in a very short period of time. It's a good 3-5-year exercise from planning stage to execution and really getting it to hit its stride. We're happy with how we've deployed capital, and we certainly see the returns continue to accrete. In addition to that, we've also advanced our ESG initiative with regards to an energy-efficient facility. This was a retrofit that we did, but we've deployed in solar panels to be able to ensure that we reduce our carbon emissions. It is a BREEAM excellent certification gas-free site that we have set up, and we are already being recognized for what we have put up out there. Expect more in the next 3-5 years as we continue to future-proof the business in terms of how we make the moat deeper around our business. Salvage line acquisitions is the other piece I talked about. As and when the opportunity comes, we certainly are in the market to make sure we can expand our salvage business. With all the supply chain disruption that's taken place, the salvage business and this dual sourcing strategy we have in our North America wholesale business has really been huge in terms of being able to fulfill the order that was coming through. We are going deeper and broader from a salvage perspective on that business with how we inventory the parts that we extract from our salvage businesses. Talking acquisitions, and again, this is a very specific focus that I have out here as a case in point with my specialty business, Fab Fours vertical integration, ability to cross-sell, and really utilize our distribution capabilities within the specialty business to throughput more product. SeaWide Marine is the third leg in the stool of our specialty business. Really, it was a SEMA product business. We sell the RV leg, and now SeaWide is the third leg that the specialty leadership team has come through with. We closed the transaction the first of October of last year, and really happy with how the team is progressing from a synergies perspective and really driving that opportunity hard also. Finally, I think it's a case that for the longest period of time, people always thought that LKQ was a serial acquirer, but we have been selectively divesting businesses also. Again, good businesses in its own right, but whether we were the rightful parents to be able to help the business grow to the next level. We have divested PGW Auto Glass being the most recent one that we closed on the eighteenth of April, so just over a month ago. AeroCycle, which was our aircraft recycling business, it was an adjacency which did not work out. Again, you know, we backed out of it and, you know, wish the team that's running it at this point of time. Stahlgruber with telecom. Certain non-core assets come with some of the larger acquisitions, and we've just taken a very surgical approach to ensuring that we swim within our swim lanes with regards to what we do as a business, but also continue to expand at the edges anything that we can do to make our customers more productive and more efficient. Our customers win, we win. This is a financial policy update. Really, I think most of you have seen this in the past in any case, but just to kind of highlight the focus on free cash flow generation remains undiminished. Our target free cash flow to EBITDA conversion, as you've heard me say time and time again, roughly the 55%-60%, that will remain. Optimal leverage, roughly the 2x. We're kind of comfortable going up to that level. We're perfectly fine with that. Deploying capital into the highest return opportunities. I've given you a few, you know, examples as to where we do that, returning to shareholders a regular quarterly dividend, and then obviously topped up with share repurchases, and then maintaining appropriate liquidity. As I mentioned, no significant debt maturities till 2024, but really making sure that we maintain adequate liquidity to continue to invest and operate the business and grow the business even through a market cycle. Last two slides, and this really kind of brings it all together, is the investment thesis. Very similar to what you've been hearing, not just from Nick when he kind of set the stage for this, session today, but what you've really heard from each of our operating leadership teams as to what they've been doing. This really brings it together in terms of there should be no doubt in your mind of the market position that we have built up through the hard graft and some thoughtful planning across our entire business. We have stable businesses that continue to grow through economic cycles. Organic growth and operational excellence, and I've given you examples of what we've done out there, but we really expect organic revenue growth, to be faster than market. Okay, we will continue to outrun the market, i.e. take share, and we expect to grow our EBITDA faster than revenue growth. The third leg really comes in capital allocation is really allocating capital to grow earnings per share faster than EBITDA. If you think of the algo, revenue growth will, you know, faster than market, that'll be and EBITDA growth will be higher than that revenue growth, and then with judicious capital allocation, have that continue to spin out an accretive earnings per share, you know, across, you know, for our shareholders. Driving consistent and strong growth in adjusted EPS and rewarding our shareholders over the long term. In closing, before I hand it back to Nick for his final closing thoughts, just to reiterate what Nick mentioned earlier this morning, embed operational excellence across the entire global enterprise. If anyone thinks we're completely done with operational excellence, there's still some way to go. We feel good about the fact that these are things that we control ourselves rather than the market. So when you think about accretive margins and free cash flow generation, these are largely within our wheelhouse that we've proven, and we believe there is further opportunity in those. So profitable revenue growth, enhancing our margins, cash flow generation, but clearly without having the best talent bar none across the markets in creating a world-class company, talent. You saw a small subset of it earlier today. Those of you that are here in person will get an opportunity to interact with several others as we break for lunch, and we also, you know, showcase some of our products and services. Sustainable targets with regards to organic revenue growth, you know, 2.25%. 2.2%-3.2%, excluding inflation. We believe trying to predict inflation is a fool's errand. We do not plan to get, you know, overanalyzing that piece. Whatever inflation is, that's what the market is. We will continue to grow above that. With regards to EBITDA margin improvement, we believe a 15-25 basis point sustainable margin growth is very much doable. Continue to lead. We have now set the foundation at a higher level, continue to grow from there, and then really free cash flow brings it all together with regards to, you know, at least $1 billion, if not more on an ongoing basis. Thank you once again for your time. I know we have a number of questions getting queued up, both on the webcast, but obviously a number of people also have. Nick, I'm gonna turn it over to you to for your final closing comments before we get into the formal Q&A. Thanks, Varun. Hopefully by now you can appreciate why we are so excited about the future of LKQ and why we are so proud to be here. Again, as I ended my formal comments a bit earlier, we've got a number of priorities, but really, at the end of the day, we wanna be a great company for our customers, for our employees, and for the communities in which we operate. We also know, as a publicly held company, we are entrusted and have a fiduciary responsibility to be, you know, a great stock and to create value for our shareholders, and we are all focused on doing just that. These go hand in hand. We don't view them as mutually exclusive. In order to be a great stock, you have to be a great company. In order to be a great company, you need to be good stock, 'cause that really goes to the ability to attract talent. It's a combination of core business strategy, financial strategy, and investor strategy that bring it all together. I'm so excited to be the leader of this organization. I think I've got the best team in the industry. You've seen a cross-section of some of those folks thus far. You're gonna see more people as we head out to lunch. I am so honored to have this team by my side. I wouldn't wanna go into the trenches with anybody else. I'll put my team up against any other team in the industry, because I know what the results will be. That is the close of the formal comments that we have. We're going to break the stage down and open it up to Q&A, where there'll be, I think, seven or eight of us up here on stage. Again, you can ask us questions about anything you've heard this morning. You can ask us questions on things you haven't heard this morning. It's really fair game, and it's really to give you all an opportunity to ask us what's on your mind. Thank you very much, and we're gonna take a very quick break here to get rid of the podium and bring up some chairs and answer your questions. Thank you. Now the fun stuff, Q&A. Again, thank you everybody for your participation and those participating on the webcast. You have the opportunity to click into the question box, and I'll direct it to who I think is best suited to answer it today. Again, I hope today gave you a better sense and appreciation of the power of LKQ. Our market-leading positions in each of our operating segments, the strength of our global teams, which you had an ability to see, and the results that they've delivered in a very challenging market environment really speak for themselves, and you've heard that multiple times today. That is a key message. Importantly, today's presentations focused on the trajectory and long-term opportunities that lie ahead for LKQ. We look forward to questions related to those opportunities and specific questions related to today's presentations. I'll give folks here an opportunity to formulate their questions, and someone sent in a question here. I think I'll direct this to Nick. It says, "LKQ has witnessed a tremendous amount of change, not only in your strategic vision, but also with the operating environment we face all over the last years, yet LKQ thrived. That said, what allowed LKQ to perform so well through such a challenging environment, and what gives you the confidence that LKQ will continue this success and strategy going forward? Okay, multifaceted question. As I think about it, let's all transform and go back in time, I don't know, 24, 26 months on what's happened during that period of time. Clearly, more change than I've ever experienced in my business career. First, a pandemic, right? The worst pandemic in the history of the world. Over 1 million of our human colleagues have perished because of COVID-19. That sent economies globally into shock. Two years ago, in May of 2020, unemployment in this country was 30%, right? Economies around the globe were in freefall. What did governments around the world do? This massive fiscal stimulus to try and protect all the economies globally. In large part, you have to argue it worked, but there is no free lunch, right? I think today we're seeing the cost of all that investment. You know, you start with the labor situation. What was meant to get people back to work, in some ways resulted in what's referred to as the Great Resignation. I mean, at least in this country, the number of people who exited the labor force was unprecedented high. We are all scrambling for labor. I mean, there's 11 million open jobs in this country today. The supply chain debacle. You've all seen pictures of 100 ships sitting out on the Pacific Ocean waiting to get unloaded off the Long Beach and LA ports, and the ability to get all those containers through the ports and into the heartland of America, just everything has multiplied, both time and expense. Inflation is everywhere, right? By last count, I had $32 trillion of federal stimulus by global governments over the last two years. When you pump in $32 trillion of capital into a marketplace where the net output of goods and services remain relatively flat, yes, you're gonna get inflation. Okay. And so you have inflation in raw material cost, inflation in labor, inflation in fuel. In this country of $4.50-$5 a gallon gas, that's really good. If you're in Europe, you're paying, you know, north of EUR 10 a gallon in gas, right. So massive inflation that we've had to deal with. Now, sprinkle in on top of that, things like pretty widespread global racial riots, an election in this country that has divided our population, a Russian president that decided to usurp Ukraine. All that has happened in the last 22 months. Think about it. Yet, as Varun talked about, LKQ has never performed better. Joe, the question was why? You know, on the fly, I would say three things, three words: resiliency, focus, and talent. Okay? We operate in a very resilient industry. The parts and services that we provide are not discretionary by a large amount, right? The reality is people around the globe depend on their personal vehicle to get along with life, whether it's to go to and from work, whether it's to go to the grocery store, to the doctor, vacation, whatever. People use their vehicle to get through life. If the car is broken, either because of a mechanical failure or a collision, people get their cars fixed. They don't say, "You know what? The economy is really soft. I'm gonna wait for 2 quarters before I replace my battery," 'cause your car doesn't start without a new battery, right? This is not a discretionary type of part or service that we sell. It's non-discretionary. It's essential. We operate in a really resilient industry, and we have an incredibly resilient workforce, those 46,000 people at LKQ who come every day to achieve our mission, right? The second is focus. When things are really tough, you need to figure out real fast what's important, and everything cannot be important, okay? What we started with this focus on profitable revenue growth, better margins, and better cash flow, and we just put that into overdrive when the pandemic hit to make sure that we had a business and a financial structure that was sustainable. It's talent. Where we really separate our company from most all of our competitors is the talent that you see on stage to my left and to my right and all the folks out in the field, all the ladies and gentlemen sitting in the back of the room there. We've got the best in the industry, okay? That is what has made the difference of us being so successful in a market environment over the last 22 months that was beyond any of our comprehension, you know, on January 1, 2020. When you think about everything that has changed in the world, and us to be able to post up the results that we have, resilient, focus, and talent. Great. Thank you. I'm also getting questions via text. Let's put it out to the group here, and we'll start. Okay, I got many choices. We'll start with you, Ryan. Hi, yes sir. Thanks. Ryan Brinkman from J.P. Morgan. Thanks for taking my question. If we were to think big picture about the roughly $13 billion of revenue that you generated last year versus the, I think, $12.5 billion pre-pandemic, are you able to disaggregate at all the relative drivers of the revenue increase between volume and price? Are you shipping the same amount of products, I don't know, in units or tonnage or however you look at it, at higher prices? Or are you shipping fewer units at still higher prices? What is the implication to LKQ financials from this seeming recomposition of revenue away from volume toward price? I would imagine at a certain level of revenue, if more price and less volume, it's less shipping and handling costs, et cetera. What is the outlook for volume and price, do you think, going forward and the potential impact to LKQ financials? Yeah, I think, Varun, that might. You leaned in. Let's give it to you. Let me answer. It's a great question, Ryan, and thank you for asking that question. In each of our businesses, we do track PVM, so price volume analysis, right? We actually run that piece across each of our businesses. Frankly, each of our businesses has a slightly different story, okay? But if you think about how our European business is, it's a combination roughly 50/50 in terms of volume and price, in terms of, as you think about organic revenue growth. As you think about our salvage business here in North America, that's actually up both in volume and price relative to, you know, pre-pandemic levels. We've made no doubt about the fact that on our aftermarket business here in North America, given the supply chain challenges, volume continues to be down, okay? It is not as down as what repairable claims have been, but that is continuing to be on an upward trajectory, and we are well positioned to be able to take advantage of as volumes come back on that front. Out there, it's largely price. As you think about our specialty business, it again is volumes are coming back in certain parts of the portfolio. Really the reason I kinda say this is across the board, it's a combination of both price and volume. As you think more importantly about the future, we do expect volume to come back as things begin to stabilize. The question is, a year ago, if you'd asked us, the question would have been, listen, we think supply chain challenges will perhaps abate by the middle of 2022. In today's day, things are getting pushed back, you know, a little bit further, whether it be exacerbated due to the China lockdowns or the zero COVID policy, things along those lines. We feel good about the fact that even as volume continues to move up, the productivity initiatives that we've already embedded in the business will continue to help drive, you know, a stronger, more resilient business on a go-forward basis. Having the parts and inventory will continue to allow us to take share as we have been even over the past few years. Very helpful. Thank you. Yeah. Great. Thanks, Varun. I'll take one more from the group here, and then I'll go back to. I know Brett had his hand up, so thank you. Yeah. Bret Jordan with Jefferies. Could you talk a bit more about the AI initiative? I think it came up in a couple of different slides. I guess, is that something you're seeing the return on already as you're buying salvaged vehicles better? I guess that would apply into the battery purchasing going forward. Is that gonna be sort of a one step function up as you get the return on that? Or is that gonna be something that's more gradual to margin? I think, that's probably a Q&A question for Justin and Rick. Yep. I can take on the AI for salvage procurement. We definitely saw a step up in gross margin in the cost reduction. We expect to see a continual gradual improvement for the years to come with it. It really enhances. Once again, we have a lot of bidders. I mean, you look at 3 million cars that we did last year where we bid on to win roughly 240,000 cars. Every vehicle they're looking at has 12 pictures, and they're trying to identify 20-30 parts at a minimum out of all those photos as to what is the interchange, what does it fit, what year range does it fit? Is it a good sellable part? Does it have damage on it? That AI technology is, you know, started off to originally enhance them, hence the people that are bidding on those vehicles, but then also correct some things that the human eye doesn't catch. You know, you get kind of burned out when you're looking at so many photos. I mean, you can imagine 12 photos against 3 million cars. It's a lot of photos for people, for teams to look at. We saw when we started rolling it out a step up, and then we're continuing to see gradual improvements as we tweak things and continually let the AI learn from feedback, not only from the bidders that we have out there, but then when that yard or that vehicle gets procured and shipped to the yard, then they're actually physically looking at it, going in and correcting something, and then constantly training that machine, constantly training the AI to make it even more accurate going forward. You had a question on the battery side, I think. Whether the AI was applicable to buying batteries going forward, you know, just from a core standpoint. Yeah. One thing we looked at. I don't know, you wanna take over, I mean? No, go ahead. On the AI, it's helped us identify submodels. A lot of times when you're bidding on vehicles at the auction, you know the year, make, and model, but then what is the trim levels, and what does the different submodels represent? We began to leverage that data on photo recognition with AI to then help us understand, once again, the submodel and to know all the different options that it came with. 'Cause it isn't necessarily clear that it's a hybrid or if it's a Tesla, obviously, it's clear that it's EV, but it's not always clear the EV type. We are starting to expand the ability of AI to eventually look at that type of interchange availability to look at batteries or other product lines. Great. Thanks. Now we'll switch to a question we got through our portal. This one I'll direct to Arnd and Yanik. What gives you the confidence that you can achieve double-digit margins in Europe this year, given Q1 came in at 8.8%? I think that's a question that you both can answer. Yeah. Thank you, Joe. Of course, that's a very valid question, looking at the beginning of this year, which of course was everything but in line with our budget assumptions, not only from an inflation standpoint, but also from a standpoint of what our political and economic environment looked like, other than just inflation and supply chain. One thing was certainly the events in and around the Ukraine. We have around 900 employees in the Ukraine, 45 branches, and that business went pretty much to zero. That certainly was a burden. We had a couple of one-time items, including some customer bankruptcies on three-step level distribution. The main thing was overall softness of volumes and the fact that we saw a strong increase of the energy prices and transportation prices on some of our SG&A line items. In essence, the first quarter was untypical. We took a lot of actions immediately to respond to all those short-term challenges. The Ukraine situation as one, the inflation pressures on our SG&A, whereas we had to focus a lot on the product prices and on the SG&A. We got caught a little bit by the energy prices around the Ukraine crisis. That has now all been factored in our revenue optimization and pricing activities. Also in the second quarter now, the volumes are picking up quite substantially. That's certainly something that, among other things, makes us quite comfortable with sticking to our double-digit margin expectations for 2022. I believe we also have the necessary tools in place to make it happen, both from a top line as well as from a cost management standpoint. Yanik may give some further details. Sure, Arnd. Thank you. Again, as you mentioned, Arnd, I mean, we are really confident that the double-digit EBITDA margin in 2022 is achievable. I'll say 3 additional points. First is the entire team is sharply focused on achieving double-digit, not only in 2022 but beyond, obviously. That's gotta be sustainable. The second point is, Arnd, as Nick mentioned earlier, resiliency. We built really resiliency in our operating model. We are extremely focused on extending our gross margin through procurement projects which we have and also our pricing initiatives. That's not only to offset our cost of goods sold and inflation, but the OpEx inflation. We believe that by deploying the actions on the pricing side and the procurement side, we will be having some favorability from a P&L viewpoint in 2022. The third point is the productivity initiatives we've launched, the efficiency initiatives which we've launched. This is really helping us make sure that we have the right level of expenses, operating expenses, SG&A, which is in line with our revenue growth. Again, overall, we are confident that a double-digit margin in 2022 is achievable. Great. Thanks for the question, Joe. Yep. Thank you, and thank you for the very detailed answer. I'm sure everyone appreciates that. I'm gonna go back to the group here and see Daniel Imbro from Stephens is next up on the order here. Yeah, thanks. Daniel Imbro from Stephens. Maybe two quickly on North America for Justin and Rick. Justin, on demand, you know, when do you think ADAS begins to more meaningfully impact accident frequency? And when you guys look at your long-term projections, are you baking in kind of a headwind on that collision side from that? And then on the profitability, you guys talked about, you know, assuming that there is no inflation or pricing going forward, but if we did get inflation on top of that, should there be additional margin leverage that would drive more than what you laid out in the slide, I think 10-30 basis points on top of that? I'll take the first question and let you cover the second one. Yeah, I mean, more meaningful in ADAS, I think it's gonna continue to roll in at the same rate it has. We've seen accidents reduce because of ADAS, right? Make no mistake, Arnd kind of touched on this, but the benefit that we're seeing, even though the volume of repairable claims is going down, the number of parts on the estimate, the pricing of those parts on the estimate and the availability of service to provide on that estimate, such as Elitek, is outrunning right now the ADAS side of it. I think a couple things are gonna come into play. ADAS will continue to work and function as it should and reduce accidents, but a couple things that are going on as we talked about. I think less and less work from home. You're gonna see over the next 2-3 years, less of that to some extent, more congestion on the road leading to an offset of some accidents. In addition, we struggled on when we talk about price versus volume. We struggle on the aftermarket side. We have more demand right now than we can fulfill. As the supply chain improves, whether that's the early 2023 or the back half of 2023, what have you, we will see fill rates go up. We will have the ability to say yes. We'll be able to offset more of that with growth and volume. In addition, Rick talked about we've expanded salvage yards. We're continuing to expand salvage yards to make sure we can hold that car longer and have the ability to say yes. I also mentioned we've seen a shift, less and less of my business is relying on collision, more and more on mechanical and other avenues. I see from an LKQ standpoint, we'll still be able to outrun, hit those targets of 2%-3% from a volume standpoint regardless of what happens with ADAS. We've already seen some of the reduction of accidents. Because of ADAS, you're gonna continue to see that, but we have enough diversification in North America that we can offset that. Yeah, I think, Daniel, on the inflationary questions, it's a good question. Obviously, it's gonna help revenue, right? We'll work on that to pass that through. We keep talking about it, and we're cautious on the way we talk about it for the products, right? The product increases, we would expect to pass that through. There's other inflationary increases, right? You got fuel, you've got labor cost increases that we're seeing across the board. I'm sensitive to not commit to a broader margin expansion. The goal would be to hit those numbers that we're talking about on the margin expansion piece that we've committed to. I wouldn't necessarily take inflation and say% margins will actually increase. You know, we've got a ceiling, obviously, with the products that we sell, and that's one of the things that we look at with our customers. Great. I'll switch back to an earnings question. I don't want Bill to feel left out, so I'll direct this to the Specialty group. There's probably a component of this that Nick Zarcone or Varun Laroyia can touch on. The question is the capital that Specialty needs, acquisitions, CapEx, self-sustaining, or does it compete for capital under the corporate umbrella? Second, how do you think about the cyclicality of this business versus the broader LKQ business? Maybe I take the first one with regards to the question being, does the capital from an acquisition perspective within the specialty segment compete with other priorities? Yes, it does. You know, as we've talked about, you know, there's very disciplined allocation of capital that comes through. The good part is each of our segments has got exciting opportunities that they can expand, whether it be acquisitions or organic investments. As we risk adjust acquisitions versus, organic revenue growth opportunities, we prefer the organic revenue growth opportunities, lower risk and more certainty with the outcomes associated with that. Overall, yes, I mean, those are being tested against various other alternatives. I feel very comfortable about every transaction that, Bill and Gary have brought to Nick and myself. They've been very well thought through and, you know, they've hit their marks right from day one. We have seen no slippage on any of those pieces. In terms of the operational excellence mantra across the enterprise, arguably, I'd say our specialty segment was perhaps the precursor of having already gone down that path because they understood the kind of markets that they operated within. The operational excellence within that specialty segment is top-notch. From that perspective, I certainly want to share that. Overall, listen, we have access to capital, so capital has never really been the constraining factor for growing our business. Really, what we do is very thoughtful capital allocation, and that's the key piece Joe, ready to kind of talk about to say, great to have a bunch of opportunities. Again, we means test them against say where the other returns could be, including our share repurchases. You know, that's the kind of rigor we run them through. Before I turn it over to Bill, just for the sake of clarity, we've never had to say no to one of our business units who had a great idea to grow their business organically or inorganically because of a lack of capital. Never have we done that. You know, between our $1.7 billion of EBITDA, which gets to $1 billion of free cash flow, $700 million after the dividend, between $700 million on the one hand, and the ability to flex the balance sheet up to, say, 2x. There's another $1 billion of capital there, potentially. That gives us $1.7 billion of capital. We've never had to say no to really good projects, and I have no intent of saying no to really good projects that can create shareholder value over the longer term. Bill, I'll let you take the hard part of the question. Well, I guess on that point, I would say we're very competitive in the specialty segment, and we don't mind competing for capital anywhere. I think our main characteristic is credibility. It really goes to the organization and the ability to follow through on what we say we're gonna do. Like Nick Zarcone said, the capital's been there when we need it, and much of the process is something that we do ourselves in terms of a discipline not to bring something that we don't think is worthwhile. On the front of just the discretionary spending question, our business in the specialty segment has transformed really a lot in the last 10 years from primarily a performance oriented accessories business to what is now somewhat close to a hardware store for the RV business and the marine business. I f you think about those markets, someone investing in an RV, that may be a discretionary spend, but after they buy it, they're gonna use it. Whether they travel a long distance to use it or they travel locally to use it's really a service and maintenance type activity where we support that in every way. If you need an awning or you need an air conditioner, you're gonna get it if you're using the RV. That's where we come in. The marine market we see very similarly. We're excited about where we've taken the business from a transformation perspective, in terms of what we inherited. Great. Thank you both. Or I think maybe three people answered that. Next question comes from maybe not Brett, if anybody else has. No. Craig. Anyone else? Oh, okay. We'll bounce it around. Craig? Back to you, Bret. Okay, thanks. This is Craig Kennison from Baird. To the European team, we know that that business is primarily a professional service business and also in the mechanical market. To what extent is there an opportunity to serve retail customers in some future period? Why hasn't collision been a bigger part of that business given what LKQ does here in North America? Great. I think that it's probably a joint response to that. Arnd, we'll start with you on the back half of the question, given you talked about collision during your formal remarks. It's a great question, of course, because there seems to be, of course, a lot of differences between the U.S. or North American business, not only in LKQ, but market-wise and what we're doing here in Europe. Here in Europe, B2B, doing business with the workshops is the overwhelming majority of the market. The DIY business is relatively small, depending on market, between 4%-12% of the market. There has been some quite interesting growth on several players that are e-commerce players. Some of them have hit a certain ceiling in their growth, and that is because of limitations of the DIY market. They are transforming now their business to go more into the informal or smaller workshops that don't act on a professional basis like most of our customers. That is an additional growth opportunity for LKQ, as it is an additional growth opportunity for the e-commerce players. The DIY market is certainly quite limited, especially if you stick to individual markets. There is growth opportunity. We're studying our way to market at the moment, if we can reach more market penetration going into the even smaller workshop businesses. Retail has not been a success model here in Europe. Both from the supermarket standpoint, the specialty stores, most of them have either reduced scope or closed down. We've also seen it in many of, or at least in Western Europe, in our retail stores, in our branches that we have gradually reduced because most of the business due to the complexity of the vehicles is now in the professional area. Collision, a very interesting question. We have a collision dismantling business in Scandinavia. Atracco has been with LKQ for quite a number of years. We have worked on the operational performance of our distribution business for the last two and a half years. We have also worked on the operational performance of Atracco. They dismantle around 22,000 vehicles. We have 3 million part numbers on stock, and we believe that's a growth opportunity for LKQ now that we have reached a certain performance level, growing it outside of Scandinavia and also connecting that business with our mechanical electrical parts distribution system, creating another choice for our customers and creating another choice for consumers, and also making a major contribution to a more sustainable business, including the circular economy, which is a big topic also from a regulatory perspective in Europe. Number one is we will continue to grow our B2B business, including ways to expand into smaller workshops. Number two is great growth opportunities in the collision segment, reaching with more alternative solutions into body shops and other repair shops. Craig, just to put it in perspective, in the United States and Canada and North America, alternative part usage measured in dollars, this is a statistic that CCC publishes, around 38%-39%. So of the total dollars spent to buy parts to repair a collision-damaged vehicle, about 39% of it is aftermarket, recycled or refurbished parts. That number in Europe is about 7%. It's just the insurance companies in Europe just have not put their shoulder into the utilization of alternative parts like the North American insurance companies have. The one thing that may change this, and Arnd hit on this, is this whole concept of sustainability and the circular economy and the ability to use salvage parts, okay, as part of that green initiative. We think there is some real opportunity there. Great. Arnd, thanks for that comprehensive answer, 'cause you knocked two other questions out that came in electronically. I will now go back to Bret, and give him an opportunity to ask his follow-on question. Yeah, a question around Europe. I think historically, when you've entered markets, you've acquired one of the major players in that country, but you said you were gonna open two DCs in France where Autodistribution and Alliance are already in the market. Is this gonna be margin dilutive or an investment phase to enter that market? Or is this, you know, sort of comparable to what you're seeing in the rest of Europe? Yeah, I think that's probably. Arnd, you wanna talk about the strategy in terms of entering France and, you know, take the operational side of it, and maybe Yanik can jump in on the margin so that we hear it from the two of you. Thanks. Thanks, Brett, for the question. Of course, there's a number of markets that, and you saw it on the map earlier, that we don't have the same presence, like in some of the core markets in Central Europe or, like in the UK. The Benelux business that LKQ acquired in 2013 had started to really penetrate the French market from the northeast side already many years ago as a three-step business. The market is looking for an alternative. The market is looking for another big player coming in there. We get a lot of positive feedback and reception from the customer base that we have there, also in other territories. We're gradually expanding our presence there. It is not dilutive to our EBITDA margins. It's a very attractive market in the way that we do it. We may see, like, it was discussed as part of the LKQ overall strategy. We may see some tuck-in acquisitions to help us with this penetration of the French market to grow faster. Looking at the people that run this, looking at the organization that is working on those projects, that is above average EBITDA margin, I believe we are in very safe hands with that growth strategy. Certainly it will not make us a number one in a few years, but certainly it will help the overall top line, and it will also help the overall bottom line of LKQ in Europe. Great. Thank you. I think you. I wouldn't add anything. I think you're Okay. Yep, it's good. Thank you. I think he answered it. I'm gonna turn to another question that came in, and it's great because it doesn't leave my friend Mike Dufresne at the other end out. Mike, how should we think about the growth of the self-service business on a go-forward basis? Do you think there are opportunities for further expansion? Thanks, Joe. As far as the growth goes for self-service, as you saw in my presentation, we have quite a bit of space to grow. You know, what we are looking for is the proper demographics in the area, as well as enough room for us to operate as far as space-wise to run the retail yards the way we operate. There is obviously a lot of room for us to grow this business, which could be greenfield or could be by acquisitions. As long as we have the correct demographics and the correct land mass so that we can operate properly, we have plenty of opportunity to grow, Joe. Great. Thank you. All right. Next question comes from Scott Stemper. Right here. Scott, put that arm up higher. Thank you. Good morning, and thanks for taking my questions. Free cash flow the last couple years definitely benefited in Europe from some of the payables extension programs that you put in place. How much more room is there? Now that you have this triple status of investment grade, are there any other capital allocation opportunities that get unleashed from that? Great. Great question, and I think the natural for that is, Varun. Joe, what I'll do is let me start off the piece and then Yanik has got more details associated with it also to kinda give you a comprehensive response. If you go back to September 2019, when we launched the One LKQ Europe program formally, it was almost like a European-specific investor day session that we hosted. At that point of time, we set out very specific targets, you know, exiting 2021, whether they be margin associated and growth associated. I think it's fair to say we hit every single mark that we put out there. Okay. Oh, by the way, in the midst of all of that, there's been a massive pandemic and all the, you know, market volatility. The additional piece that we had called out there was that, we would also need to undertake certain restructuring actions, and in anticipation of the restructuring, to kind of say, "Listen, what will pay for that cash restructuring?" At that point of time, I had put a number of $200 million of incremental free cash flow coming from the European segment. Earlier today, you saw Yanik present a number of $300 million benefit that we've already picked up from the European business, so, you know, clearly exceeded that target also. Fair to say, in today's date, while we have done a tremendous amount of progress, we started from a position where the only side was upside. Okay. It was a business that we were building out, making sure we had the right footprint, market leading, national champions, and then making sure that we were investing in the underlying inventory systems, things along those lines. We've, you know, delivered on all of those pieces, and really now it's the case from a payables program. We've been hitting our marks, and I'd say internally we have certain targets with regards to what that AP to inventory ratio should be. There are some external benchmarks. They're not exactly what we do in Europe because we don't really have a retail presence. But at least the product set and assortment is similar. It's a similar set of suppliers. We know because we serve those same folks here in the U.S. through Justin's business and also through Bill's business as to what market convention they expect from their suppliers, right? Really what the investment grade piece does is it really lifts the ceiling where trade payables could not exceed 180 days. Although I will tell you from a European perspective, we still have some ways to go to get to 180 days at this point of time. Okay. We see significant upside on that front. I tell you what, let me kind of share that background and then turn it over to Yanik, and he'll give you a few more details in terms of what that team is doing to continue to push hard on this front. Yanik, over to you. Yeah. Thank you, Varun, and thank you, Scott, for the question. Look, as you mentioned, Varun, I mean, free cash flow is key. I think we've made really great progress. We've improved our trade working capital out of the supply chain financing program and the traditional extended payment term over the past two years by $300 million. Now, the target back then was to increase by about $100 million every single year, so we've really exceeded our target. The momentum is good. If we're looking at our DPO, we've improved our DPO over the same period, namely between 2019 and 2021, by about 60%. Again, looking into where we stand now in 2022, we've made some further progress, and yes, there is more progress to come. A clear focus on ours is our net base, namely our cash conversion cycle. This is part of our target. Everyone is fully aware of this, the leadership team in Europe, and I can say that today, we have our best cash conversion cycle we've had over the recent years here in Europe. Yes, there is more upside. We're working on this upside. And as Varun mentioned, the 180 days is a target, making sure that we're improving our ratio accounts payable on inventory. I mean, we've made great progress, but there is certainly more upside, and we're working on this. Thank you for the question. Just to close, Scott, the last piece that says, you know, clearly, if you size up the opportunities across the various levels that deliver operating cash, the A/P to inventory piece is by far the biggest opportunity, right? Needless to say, and I want to make sure that people understand, the European team has actually been pushing on the other levers also. When we talked about the Benelux Central Distribution Center, you know, consolidating four distribution centers into one, along with that comes the ability to manage days inventory on hand far more efficiently also. If you think about how the teams are managing safety stock levels, clearly, we would like to have more inventory, but really in terms of being able to manage the business and continue to maintain market acceptable fill rates, you know, they are working on that front also. Same thing with the receivable side. You know, the clear focus across the business a few years ago was, you know, the level of past dues we had in the business. We had done everything for our customers, we'd gotten everything signed off, but the way the system was structured had to be restructured to say, "We don't want there to be folks that are extending and using LKQ as a bank." That is the other piece which I want to highlight across each of our segments. You know, down to the plant level, it's like clear focus on making sure if we have delivered everything per our commitments, we expect our customers to pay us on time also. That too has kind of delivered a bunch of, you know, upside associated with cash that was due to LKQ. It's each of those pieces. Just to kind of say, it's not only about the vendor financing program or extended payment terms, the team is working across multiple facets and multiple levers that they're pushing and pulling to make sure that we see that, the business and really the potential associated with organic revenue growth, margin creation, and also generating a prodigious amount of free cash flow. Great. Thanks, Varun and Yanik. Keeping us on track, we're at 12:18 P.M., and I indicated we'll go to 12:15 P.M. The folks here on site have the ability to interact and maybe ask additional questions when we break. I figured I would take one last question from the portal, and then we'll conclude our day. Actually, this question is pretty broad, and frankly, it probably can go across all segments, and it's related to supply chain. How have your fill rates and overall necessary inventory levels been impacted? How does this compare to our competitors? Are we taking share because of weaker competitors? Are we witnessing relief in the supply chain, or are we still facing the same challenges from 2021? Maybe we'll go in order, and I'll let Justin talk briefly, Bill, and then Arnd and Janik, and that will conclude our formal presentation and Q&A. Thanks, Joe. On the supply chain side, we talked earlier, our used or recycled OEM piece does not really have the supply chain constraints or the global supply chain constraints that we talked about. Reman has a little bit because even though we feed the cores from our used division, we still have to go get new products to remanufacture those engines or transmissions or what have you. The main business that was impacted by global supply chain for North America is our aftermarket. The majority of the products come outside of North America, whether it's produced outside of North America or distributed inside of North America but still produced outside. Of those products, majority come from Taiwan, so not a lot out of China. You know, in April and May, when China shut down, it actually benefited our business because it freed up capacity coming from Taiwan directly to the U.S. As we know, we're seeing Shanghai starting to open things back up, and there's been months of demand building. Unfortunately, even though we saw a slight improvement for North America on the inbound, you're gonna see it lapse backwards, I think, just because as China opens up and tries to catch up, some of the retailers projected high summer month opportunity, some have not. There's a lot of demand coming out of China. When that demand opens back up, it's gonna suck capacity away from Taiwan. We're gonna see maybe a 2- or 3-month issue of that. Overall, we're thinking, you know, we had a slight improvement in the last couple of months. It's gonna get slightly worse, but overall, things are gonna gradually improve. At the end of the day, you look at there's a high demand right now and not a lot of capacity for workers, not a lot of capacity for feed coming into the ports, as Nick talked about, getting into the railheads. When we used to order a product or order a container from Taiwan, it would take us 30 days to get it from date of order to the day that it gets to our warehouse. It's 60-90 days now on average. Our competitors or even people in other industries that are importing are seeing that same thing. There's a lot of equipment sitting in stages across North America, which is now gonna create more and more shortage of capacity coming out of China. I think you're gonna see the next 3-6 months of problems with supply chain unless something causes demand to come up. You know, Nick talked about 11 million open jobs in North America. We're not gonna have that many people enter the workforce all of a sudden. It's gonna take gradual time to get that improvement, or we're gonna see some level of recession or something that's gonna bring down demand and allow things to normalize a little bit. Great. Bill, you wanna Yeah, I guess. Take a stab at that, and then we'll. The short answer from me would be that our inventory position has really improved quite a bit, and we are in a much better position overall from a fill rate and supply perspective. There are still pockets of problems, and it really moves around a bit in terms of where those end up being problematic. Just, you know, more from a general perspective, I would say the marine market seems to be still probably in the largest kind of supply issue status of the core markets that we're servicing, so. Great. Arnd, you wanna touch on the supply chain discussion that Bill and Justin just highlighted? Yeah. Yes, sure. I think in Europe, we are still in the middle of everything. But that may be good because the players that are suffering most from the current situation are the smaller players that don't have the leverage that LKQ has. We are in extremely tight contact with all our suppliers. Many of them are OE suppliers that, you know, ship parts to the OE production lines but also parts to LKQ. When there's volatility on the OE side, they open and close their capacity. That's one of the problems. The other problem is the upstream supply chain with, of course, other European sub-suppliers, but also a lot of overseas sub-suppliers and overseas raw material supply. On top comes the Ukraine crisis. The number one and the number two steel exporter into Germany, for example, are Russia and Ukraine. You've been all following the news, what's happening to the steel industry in those two areas. It's not easy. It's difficult, but difficult is playing to our favor because we manage it more professionally than the smaller players. Also regarding our overseas supplies, we have made a decision to move closer to those suppliers. At the moment, we're opening a supply chain and procurement coordination office in Shanghai, China. We're very optimistic that this will help greatly to continue to protect our customer service levels that are industry-leading at 97%+. Great. Thank you, each of the segment leaders for a very comprehensive answer to that question. This concludes our formal comments and presentation. On behalf of LKQ Corporation, we can't thank you enough for your interest, investment, and just taking the time today to really hear the strength of our business, the strength of our leadership, and the opportunities that lie ahead. Again, thank you very much. Again, this concludes the formal presentation. We have lunch for everybody, just outside. We have some of our special vehicles out there. This is really an opportunity for all of you here in Nashville to engage with the broader team, which includes not just the seven of us sitting up here, but the two dozen folks in the back of the room here. This is a unique opportunity for you to get well beyond Joe and myself to see the substance of what we have as far as the leadership of LKQ, and I would really encourage you to make really good use of your time this afternoon. Again, we'll get you back to the airport in some shuttle runs, so you can catch your flight home. Again, just to reiterate what Joe said, you've got a lot of good usage of your time. We can't thank you enough for spending your morning here with LKQ, both for folks in the room and for all of you who are dialed in either over the web or through the audio service. Thank you very much, and have a productive rest of the day. Yep. Just before you run to go to lunch, 'cause I suspect we're all hungry, Justin, you wanna just give some more granular detail as to the specific people that will be available and what their, you know, related discipline is when we head out for some Tennessee barbecue? Will do. The only thing between you and lunch, I guess, is me, so I'll make it brief. From a corporate standpoint or global standpoint, I wanted to give a few names that kinda Nick talked about, not the folks that you've seen present today, but some of the ones that are backstage or even out there prepared to answer any questions you may have. I'll kind of give their names and kind of the areas that they operate. That way, just in the back of your mind, if there are questions that you may have, please search them out when you're out there enjoying lunch. First is Michael Clark, our Senior VP and Controller. These are global functions right now. Genevieve Dombrowski, our Senior VP of Human Resources right up front here. Bob Reppa, our Senior VP of Strategy and Innovation. On his team also here is Maksim Mayarovich, the VP of Strategy and Innovation. As well, the last person we have here kind of from a global standpoint is Sandy Pierantoni, the Director of ESG. A lot of focus on ESG. Then the last one we have from a corporate standpoint is Jack Brooks, the VP, Treasurer. Now for those that are kind of based in North America or based in Nashville or really that support Nashville that are here today, just I'll run through that list. Adam Swartout, you probably saw him with the microphone walking around. He's the Director of Creative Strategy. He really helps Mike on the self-service side. Susan Trammell, our CIO of North America, so she supports apps, applications and development if you talk about AI, you talk about all the different ERP systems we have, Susan Trammell. Peter Hamilton, VP of Finance and Controller, in the back there. Jack Patterson, Controller in Financial Services of our national operations here. Scott Bretag, Director of Financial Planning and Analysis. Steve Heckle, VP of Risk Management. Yogi Shivdasani, VP of Supply Chain for North America, so you take salvage, you take aftermarket, you take fleet procurement, all that rolls into Yogi. One of his team members, Kent Fyfe, the VP of Aftermarket Procurement and Strategic Sourcing, so if you wanna talk about containers and supply chain issues, Kent's your guy. Terry Fortner, our VP of Insurance Sales and Marketing in the back. He was with Nationwide prior to LKQ. He's been with us almost 13 years, but prior to LKQ, he was with Nationwide for 32 years. Terry actually announced that he's going to be retiring at the end of July. His replacement is Mark Scafati, and he will become the new VP of Insurance Sales and Marketing to support North America. Robert Masone, Senior Director of Marketing is here as well. Scott Miller, VP of Remanufacturing, so whether it's engines, transmissions, the hybrid batteries, Scott Miller is a good guy, good resource if you wanna ask some questions. In our Elitek business, we talked a lot about that services. Nick talked about it, I talked about it. We actually have four folks here. The lead East Coast zone manager is Chip Lott. He has three other technicians out there with him that are kinda here coincidentally for training, getting trained as well as training some of the other people we have here in Nashville. You'll see them standing next to their Elitek vans out there. If you guys wanna talk about ADAS and talk about calibration and some of that other stuff, that's the crew to go search out. With that, we will be dismissed. Perfect. Please enjoy lunch. Great. Thank you. Good job, everyone. Thank you. Nick, thank you.