All right, great. Thanks everyone for joining us for the 8:00 A.M. slot. I'm Bert Subin, senior research analyst at Stifel, covering aerospace and defense. This morning, we have the pleasure of speaking with Carey Smith, CEO, and Matt Ofilos, CFO of Parsons. For those that haven't been following, Parsons has been on, you know, I would say, a tear over the last couple years. Won a ton of work on the infrastructure side, won potentially even more work on the defense side, and growth rates that certainly don't resemble a lot of their peers. Carey, maybe just to kick things off for the benefit of those that are maybe a little less familiar with the story, you just give us a quick overview of Parsons and sort of how the business has evolved between federal solutions and critical infrastructure. Sure. Well, thanks for joining us bright and early this morning, everybody. So we have about 18,500 people today. We're in, 25 countries around the world. Our revenue is gonna be roughly, this year, split between 57% federal, 43% critical infrastructure. Exciting time for the company, as Bert mentioned, where all four of our business units have been growing double-digit growth, and we have double-digit growth in all of our major geographies. Geographic split, we have 76% of the business based in the U.S., 7% based in Canada, 17% based in the Middle East. Maybe just to start off, I mean, I sort of hinted at, like, the growth, Carey, but recently—b ut, I mean, maybe the most interesting thing and the thing that people maybe caught everyone by surprise, it's just been the growth you've seen in the federal solutions business. I think it's two quarters in a row, over 40% organic and, you know, growing quite a bit even before that. If we go back to the Investor Day you guys hosted not even 18 months ago, you're talking about that business growing, call it 3% or 4%, and that's obviously changed quite a bit. Can you maybe just walk us through what's changed in that business, and maybe has there been something that structurally improved to where if you thought this business was growing 3% or 4% a year and a half ago, maybe now it's growing 5% or 6%, and you're just on sort of the positive side of that growth equation? Yeah. So to backtrack a little bit, I joined the company in November 2016, and at the time, our federal business, we only had missile defense, and we had one cyber contract. So if you fast-forward to today, our cyber and intelligence business represents 14% of the company's revenue. Space and missile defense represents 13% of the company's revenue. I would say it was a unique opportunity where you got to purpose-built a federal business from scratch and basically say, "What should a federal company look like for the future?" And so coming in, and with my background in national security for close to 40 years, really was looking at near-peer threats, and that's where the national defense strategy was headed, away from counterterrorism. So how do you put together a company that has very sophisticated, highest-end cyber capabilities, electronic, electromagnetic spectrum, information operations, and space, and then drive the convergence of those capabilities to basically be able to fight an information war against a near-peer threat? I would say what you're seeing in terms of the growth is really the culmination of that, where we've been able to kind of punch above our weight class. We're winning very, very large jobs now in the billions, and it's really a result of the combination of the synergies that we've been able to achieve through that M&A. Can you maybe tell us where we are in that life cycle? Just, you know, I think people are trying, me, myself included, sort of a hard time triangulating maybe where we are now, right? I think we're coming off the last quarter, correct me if I'm wrong, 41% organic growth in federal solutions and that was after 43% the quarter before. And, you know, this is still a business, the profile of which is, is probably mid-single digits. So maybe what— are there some, you know, data points you can point to, the, what drove that sort of, you know, inflection that to be so much greater than maybe you expected, and, you know, what happens from here? It sounds like maybe you've won a lot of work, so what's the ramp cadence look like? Do you, you still feel like there's several more quarters of sort of outsized growth? Yeah. So I would say, again, we have won a lot of work. Our win rates so far this year have been 78%, which is very strong, and both of the businesses have strong win rates. We have a classified contract that we were awarded, which we were deemed the only company that was capable of performing, so that's driven growth. Our cyber business was up 30% in the first quarter. Over 20% of that was organic. We won a very large GSA contract, General Services Administration, over a year ago that we're starting to see ramp. We've won two Army ammunition plant jobs that we've seen some ramp. We have a billion-dollar air base air defense program in Europe that's ramping up. So it's really a result of winning a lot of large, large new business. We're planning for the year, we'll have 16% organic growth in the federal segment at the midpoint. And so I guess if we're thinking about that down, I mean, that's, you know, you have 40+% in the first quarter and sort of you're staying in the double digits, and then maybe I guess by the end, you're looking at that returning closer to, let's say, high single digits, sort of as you lap some of that growth? Yeah, so I would say starting in the second quarter, the comparables get a little more difficult. We do have about $110 million of programs winding down, $55 million of that in federal, $55 million of that in critical infrastructure, and also, our objective is always to make sure we achieve our guidance. Yep. In terms of the win rate, you just brought up 78%. I mean, I think it's pretty unbelievable win rate. I mean, from what we were talking about, like 30% on new work and maybe like 85% to 90% on recompetes, and so 78% would indicate more or less everything you bid, you win. I mean, this is, like, always a question I feel like it's nebulous, but it seems like it's become more relevant to you guys. Like, is there something culturally that's changed over the last two years that's, you know, maybe increased vigor in the business development team or something that's made you guys be able to go after awards and win them with such a high win rate? So— Because this is two years in a row now of 70-ish%. Yeah, I would say across all of our six end markets, they're all growing between 5% to 12% compound annual growth rates. We're all in. That's from an addressable market perspective, so we're in all the right core markets, and once again, all four business units are delivering double-digit growth. So we just have a portfolio that we're in the right markets at the right time— I would also say we have the type of company that's delivering solutions for customers when they need them. So customers are not willing to wait for answers, particularly on the national security side. You have to have a company that's extremely agile, that's very innovative, that can get solutions delivered that they need today, and that's the type of company that we've purpose-built. And Bert, one thing I'd add is, you know, you look back at 2022, we set a record with 11 wins over $100 million. Last year, we hit 15. So you're starting to see, like, a $100 million a month, a $100 million plus award every month. You know, obviously not every month, but pretty much you're starting to see some pretty solid awards. So the scale of those contracts is much different than it was four years ago for Parsons. So I guess, Matt, on that side, then, I mean, if you're winning those awards, those take time to ramp. Yeah. So there's an element, I guess, of the awards you're winning in 2023, pushing that growth through 2024, and then assuming you continue to win additional awards, that just keeps padding that sort of like growth wave. Is that sort of how you're thinking about it? Yeah, exactly. You know, Carey talked about the $1.2 billion FEDSIM awards. That's typically like a 12- to 18-month ramp. We're expected to do $50 million-ish ± this year, so you had a run rate, it would be a $200+ million dollar job. So within our cyber segment, you get a $150+ million dollars of ramp to come in the next 12 months or so. So, I mean, maybe sticking with the differentiation theme, cyber comes up in every— Yeah One of these, you know, government services, defense type conversations, and I think everybody highlights the differentiation, which can be harder, I think, for the investing community to actually understand. But I mean, if you look at you, you said growing 30% there, historically, sort of an offensive cyber approach, then you acquired Sealing Tech. I think that's giving you more of the defensive side. Can you talk about maybe where in cyber you're having success? Is that a function of contracts broadly having cyber requirements? Is it a function of you providing labor resources for cyber? Like, where in the cyber ecosystem maybe you differentiate yourself? Yes, I, I would say cyber is an area that we're very differentiated. I always like to look at cyber in terms of three layers. The toughest layer to play is offensive, where you're working on behalf of the U.S. government, Department of Defense, and the intelligence community. The second layer would be defensive, and then the third layer would be infrastructure and services. So we don't play in the bottom layer at all, and it's important when you talk to various companies to figure out where they sit in the cyber spectrum. So we have 75% in the offensive, 25% in the defensive. We have a lot of unique tool sets that we develop. We have platforms that we develop, and we perform offensive and defensive cyber operations. Some of our areas of expertise include high-speed processing. So I think we have one of the highest, if not the highest, packet processing capabilities that we provide for the intelligence community. We also have a cyber reconnaissance platform that can basically sit on a network, track everything going on in the network. It was originally developed for Department of Defense and the intelligence community, but now with the Sealing Tech acquisition, we're taking some of the capabilities like that. We're adding it to the Sealing Tech threat hunt platform to be able to deliver it not just to Department of Defense and the intel community, but also commercial customers. And then another area that I'd say we're different because of our portfolio, we have capabilities for critical infrastructure protection. So Department of Homeland Security's identified 16 sectors or verticals that need to be protected. That'd be things like finance, telecoms, healthcare facilities, etc. So where Parsons plays is where we have installed base, the areas that are the highest threat-driven and areas that are highest regulatory-driven, because that's the toughest sector to tackle. For us, that is transportation, utilities, water, healthcare, and facilities, where we think we're uniquely positioned because we can vertically integrate within the company. An example is with the infrastructure bill, anything that you bid has to have a cyber and resiliency component. We're the only company that can answer both those needs. Where are we on the convergence there? I mean, it seems to be logical, right? I mean, if your infrastructure is gonna supposed to last for 100 years, and you know what, the next 100 years are gonna look different than the last 100 years. Are those investments actually happening? Are you seeing awards, or are you getting, you know, actually getting work to provide cyber resiliency to, you know, a transit system or whatever you're designing or program managing? Yeah, we are, and I would say it's an element of a bid. So a great example, we won a $95 million Amtrak contract last year. But to be able to win the bid, you had to have a cyber component. We're just awarded the Gateway, we're the program manager for the Hudson River Tunnel, the $16 billion infrastructure project that's gonna be taking place. You had to have cyber as a component. Even NEOM, The Line, over in Saudi Arabia, they're looking at how do they provide cybersecurity. So I would say cyber is an element of almost everything in infrastructure today. Maybe wrapping up the sort of federal solutions, at least the sort of the fundamentals of the segment. You know, I think what differentiates you guys from, from, if I think about a Booz Allen or someone else, is more of a engineering focus. I mean, obviously, we talked through cyber, but there's a lot that you're doing in terms of sort of the, similar capabilities you might have in critical infrastructure that you're providing into the federal world. There's also things you do, you know, around systems and maintenance. How does that business differ? I know you talked about before, you're more exposed to the RDT&E side of the budget. You know, maybe why is that, and, like, what are the, essentially the trends you're seeing in funding for that type of work? Yes, I would say what differentiates us overall is we're focused on solving customers' emerging challenges. We're not a company that goes after somebody else's repeats. We're thinking about what are their problems of tomorrow, and how do we bring innovative solutions to solve those? We also are not a company typically that goes after staff augmentation. So it's really, how do you provide a solution? Customer has a problem, how you deliver it. Great example, I mentioned air base, air defense. So if you're getting attacked by unmanned vehicles or cruise missiles or hypersonic missiles or intercontinental ballistic missiles, how do you come up with a solution and a system architecture where you can protect and defend all Department of Defense bases all over the world. That would be a terrific example. Another example, if you're trying to destroy mines or counter improvised explosive devices, how do you come up with a directed energy solution to do that? Or if you're trying to stop, basically, there was the Aegis attack a couple of years ago that occurred, where a fast cruise boat came up on the side. So you need a directed energy solution that's gonna stop that cruise boat in its tracks. That's the type of work we do, or if you're trying to integrate a small satellite solution to send up to space so that we can have a disaggregated space architecture, we develop that solution. We do all the launch integration. So we're really an advanced solutions company that differentiates through technology and specifically software. So if we think about, I guess, the last two years, I mean, you've won a lot of work. That work is now coming through. You're still ramping, and there's still sort of a cadence of that to go. If we put it into the context of maybe the funding environment, we just had appropriations. I guess now it's two months ago, but it should be starting to be flowing, and then we had a supplemental bill, several supplemental bills passed last month, and that's gonna provide additional funding. You know, what are you seeing in the marketplace? Has that had a substantial difference? Is it too early to tell? And maybe when does it end? Do we get to the end of September, and that just goes away, or does that continue to flow into FY 25? Yes. I would say, obviously, with the growth that we've had, we're seeing strong momentum. In addition to the $9 billion backlog that we have in the business, we also have an additional $14 billion of work that's been awarded to Parsons that's not yet reflected in our bookings or backlog, so extremely strong win rates. I would also say with the appropriations and the supplementals, we play in all the right areas. So if you look at the conflicts that are going around the world right now, you need cyber capabilities. You have to have space capabilities. I talked about information operations capabilities. In addition, areas like INDOPACOM are gonna be getting a lot more attention. There was $9.9 billion that was in the FY 2025 budget. That's an increase of 8.8% for the Pacific Deterrence Initiative. So we've been out in the Pacific for over three decades. We've been on Guam, supporting public works for infrastructure for 30 years. We've been on Kwajalein now for over a decade. We built the airfield there. We're currently doing the housing project there. We have over 100 in Hawaii. So it's a great example of kind of where the business is gonna be growing relative to the budget. Also, with the conflicts, one of the things we've seen is the need for additional munitions and ammunition. So the Army put together an army modernization plan, and it's a $16 billion program over 10 years to modernize the major army munitions and ammunition facilities. So we bid and were awarded two of those, Holston and Radford, and we've seen a lot of growth there. Very aligned with the budget, very aligned with the RDT&E, which was at a peak in FY 25, the highest levels ever. Very aligned with the future emerging threats and trends. I think importantly, Bert, I think the majority of our—w e're, you know, we benefit from the core budget versus having a bump from the supplementals. So Carey and I are very happy that it's long, sustainable, you know, core budget where we're focused. In terms of the supplementals, though, is there, I mean, there must be additional work that gets bid as a result, just 'cause it's additional money that they can be spent on projects, presumably, that you're involved in. Yes, I would say relative to those, we provide some capabilities right now, not a material amount to Parsons. But we do, for example, a threat emulator system, so it's basically emulates radar and RF threat signals. So the Russians are shooting at that instead of the real Ukrainian command and control systems. That would be a great example of a capability we provide. And then we have some in the cyber area, that are tied to the supplements. Got it. Well, if we bring this into the profitability side of things, Matt, margins have been pretty good in federal solutions. I think you guys are trying to talk them down a little bit. You did over 10% in the most recent quarter, you know, probably more on track for, like, mid-9%. You guys sorta aim for low 9%. You know, what's changed? Has that really just been some temporary things, and is the profile getting better as you get more scale and integrate some of the deals you've done? Yeah, when we talk about margins for the company as a whole, our—w e have 40 basis points of margin expansion this year. Generally speaking, because of the work we do that Carey’s talked a lot about, we end up in the cost-type environment, so it's kinda structurally limited to what I call kinda low to mid-nines. What we saw in Q1, we delivered 10.2% margin for federal. To your point, federal has been a bit better, as we've seen a little bit of the mix change, so now we're north of 50% fixed price T&M and kind of the cost type. The mix has gotten a little bit better, so I think, you know, it's very reasonable for us to be kind of mid-nines and maybe even a little bit better for the federal business. But again, you know, 40, 40 basis points of margin expansion this year is the goal. The majority of that will come from the infrastructure business as we kinda unwind some of these challenge programs that we've gotten out from underneath. We had one program wrap up in Q1. We've got another one that'll wrap up in Q3, and so we expect that, over the next couple of years, infrastructure is gonna be the biggest driver. Federal business, again, Carey and I are happy in kind of that low to mid-nines, but to your point, I think 9.5 or even a little bit better is definitely within reach, depending on final mix, but the mix has shifted in a favorable direction for us. The other benefits I'd say we're seeing on the infrastructure side is demand is so much greater than supply. Yeah. When you look at the global demand, it's unprecedented, both in the United States and in the Middle East, and at a time where there's fewer competitors because that industry is consolidating quite a bit. I guess just last question there, Matt, following what you just said, is there something about the mix that makes it change back negatively? I mean, do you—i s there something that shifts you back towards cost type, or is it just depends on sort of year to year? Kinda just depends year to year. I think we're— You know, we don't see a crazy shift to a 75% next on— on from a fixed price T&M. I think it'll kind of range in that kind of, I'll call it 45%-55%, or even 60% potentially. But for the most part, we're kind of in that range, so no, no dramatic shifts expected. Got it. Well, maybe moving on to the critical infrastructure side, I mean, I've been—I think it's so exciting, and, and it's growing like high double digits, and it's like half of what the federal solutions is doing. So, I mean, you've seen great growth in the Middle East. I mean, that's grew, I think, for five consecutive quarter, maybe even longer than that, over 30%. Most recent quarter, I think, was 19%— Yep. And that's lapping some pretty tough comps. North America, you've seen a nice acceleration in. I mean, I believe that grew 15% in the quarter. Yep. And so, you know, both of your major territories, you know, growing significantly, and that's, you know, on top of, again, strong growth last year. Can you maybe just give us an appraisal of, of maybe just, you know, IIJA and Vision 2030 and sort of where those tailwinds are for, for both of the geographies? Like, you know, if you had to say, is it third inning, is it sixth inning? Like, where are we in terms of that spending materializing? Yeah, so the IIJA was passed in November 2021, $1.2 trillion, $550 billion of new. And out of the $550 billion of new, $284 billion was for transportation, which is 27% of Parsons' revenue, so obviously aligned very well with our portfolio. We don't expect that to peak until about the 2027 timeframe, and then you'll have about a six- to eight-year tail after that. And there's already discussion about an infrastructure bill, too, because when you have unfortunate incidents like the Baltimore Bridge, people are seeing that our infrastructure is very much behind. And the ASCE report originally rated our infrastructure as a D to a D minus. So we have a lot of improvements that we need to do in the U.S. So still very early innings for that funding. The first funds to flow are the formula funds. It makes up about 60%, and yet the rest of it's grant money. But we have seen the formula funds start to flow, and I'd say as a testament to that, we've won within the last 12 months our three largest jobs in our infrastructure sector. The Gateway Program, which I mentioned for rail and transit, we won the Newark Bay Bridge program for $147 million and the JFK Roadways program for $130 million. Now shifting to the Middle East, we get excited about $1.2 trillion in the U.S., but the Middle East spends $1.5 trillion. Their projects are much faster; they're much larger. We expect that funding to peak about the 2030 timeframe. That will have actually another probably 10-year tail. Some of the big drivers there are that Saudi Arabia has been awarded the World Expo. That's gonna occur in the 2030 timeframe, and then they have the World Cup in the 2034 timeframe. It's quite a bit of spend going on in Saudi right now, and we're on almost every giga project there because we've been in the region for 60 years. We've been in Saudi Arabia 50 years. We have a 50/50 joint venture partner, really seen as a Saudi company and the number one program manager within that area. Then we're also seeing growth in the UAE and Abu Dhabi, and particularly with developers, because what's happening, a lot of folks from Russia and Ukraine have moved over to the UAE as a result of the conflict. There's some new mixed-use developments being built, a lot of marinas, yachts, places for people to live, and we're supporting all the developers in that effort. Those will be the two big drivers for the Middle East. So, Carey, you were just over there a week or two ago, and I know there's been headlines about NEOM, you know, getting scaled back and Saudi Arabia spending less. I mean, what was your impression, having just traveled over there? Yeah, so, NEOM, The Line, which is gonna be the building as tall as the Empire State Building, as long as Long Island, is getting rephased, but the overall program is still the original vision, so it will just be drawn out. For Parsons, that's okay. We're the program manager, so we're on from start to finish. So if it's drawn out, we're still on the entire program. I had the opportunity to meet with the NEOM CEO for over an hour, quite excited about the vision there and everything that's being accomplished. We're also the program manager on NEOM Oxagon, which is a floating city on the Red Sea. It's gonna be the technology hub that's supporting NEOM. Some of the other big projects we're involved with are Qiddiya, which is gonna be the world's largest entertainment city. That's right outside of Riyadh. That's moving along at a fast pace and on track because that's one of the programs that really they want to have in place before the Expo hits and before the World Cup hits. We're also doing the Riyadh Roads and Circles, which is basically the upgrade of the infrastructure around Riyadh, so that you can have better traffic flow, another program that has to be done by the time these events hit. We're involved in areas that are exciting, like Aseer, which is gonna be in the southern part of Saudi Arabia, and that is gonna be the world's tallest peak, well, the tallest peak in Saudi Arabia, a brand-new tourist resort. Then we're doing a Diriyah Gate project, which is the restoration of Saudi's history. That project, again, is very far along and moving at a rapid pace. So it's just an exciting time, and you look at our history, you know, we've been involved in Yanbu and Jazan over there for 50 years, 50/50 joint venture for five decades. And just to see that country transform and how rapidly it transformed is really exciting. In terms of if we're thinking about Saudi from a growth perspective, I want to say you added, like, over 30% to the region last year, and so there'll be an element of those new staff members sort of being, at least in the first half of the year, being lapped, and so that'll help drive some growth. Are you seeing, like, we've heard a lot of project announcements, and you've announced awards that you've had there, but are you continuously seeing new awards come out, or is it a function of new phases on existing projects? Yeah, we're actually still seeing new awards. In fact, when I left two weeks ago, I asked my team to hire more business development and sales staff. staff. We had originally bid and won all the large awards, and we were really focused on execution for the last few years. But now we have the capacity to start bidding more, so there's still quite a bit of opportunity there that's coming up. Again, not just in Saudi, but also in the UAE. So yeah, you mentioned UAE. And, and Dubai, I think everyone remember, you know, being a huge growth area, and, and there's still certainly some growth there, but that's been, you know, there's a lot of infrastructure that's been built out in the, in the region. I guess Abu Dhabi's a little new, talking about that, in terms of maybe seeing some incremental improvement there. Can you just sort of share what, what, what's happening in Abu Dhabi right now and how, how you're pursuing work there? Yeah. So if I back up to Dubai, I'd say we're kind of one of the leading companies that built the infrastructure around Dubai. If you look at the roads and highways, you look at bridges, you look at dams, you look at tunnels, and as you fast forward, now Abu Dhabi is kind of developing their infrastructure in a similar manner, but particularly these mixed-use developments. So we support a lot of the major developers, like Emaar and Aldar, and we'll do master concept planning. We even design things like parks. We design pedestrian paths, bike paths. We do all the infrastructure rerouting, and we do traffic management, intelligent transportation systems. So just quite a bit of work going on across the UAE. Maybe just to sort of, I guess, wrap up the conversation on the Middle East, is there any sort of information you can share about sort of how it differs from North America? I mean, I think I've heard historically it's slightly higher margin. People tend to think of it as being sort of harder to receive cash, but I don't think that's ever really had a major issue on your DSOs. Like, how do the regions differ, or are they fairly similar? Yeah, I'd say, you know, when you think about the U.S., the type of work we do in the U.S. versus in the Middle East is really important to understand. In the Middle East, we're heavily focused on program management. 87% of the work, ±, is program management, so we're not necessarily required. We're not responsible for delivery, right? When folks are responsible for delivering by a certain date, that's when, excuse me, DSOs start to build up and start to have major cash issues. We're really program management. We're supporting the delivery of these critical programs on behalf of the customer, and so it's a much, I'll call it, less risky and favorable margins. Obviously, it's hard work to do, and we have a very great reputation over there, and so we're able to take advantage of our reputation. A lot of these projects are all on the prince's radar, and so if they want, you know, these important projects delivered on time, they're looking for the best company to do it, and Parsons has that reputation. Great. Maybe just to sort of, I guess, wrap up the CI conversation, we've seen some, I guess, progress on the PFAS, PFOS side. You guys have been talking about sort of some patent pending, patents pending you have there. You've done some advisory work with some of the, you know, some of the affected or affecting companies. You know, what does the trajectory look like there, and is that something we should be more excited about? 'Cause I feel like you don't get reference with PFAS, PFOS maybe enough, but you're doing a lot of work in that space or plan to. Yeah, we have. So we've been involved in, I'm gonna say, water and wastewater treatment for over three decades. We have a research and development laboratory based in Syracuse, New York, focused on that area. We already do have some patents pertaining to PFOS, PFAS, about 3 that are underway. But I'll say we have a patent pending that we're probably most excited about, which will give the ability to remediate at a subsurface level. So it's basically an advanced destructive technology that will perform that remediation. We're involved in every phase of PFOS, PFAS. We've conducted over 2,000 investigations. We do remediation and treatment, and then we do all the follow-up monitoring and support. We support 4 different client communities, so one is industrial clients, many of the companies that have faced lawsuits, trying to help them perform their remediation and treatment. The nice thing with all these customers, we've had long-term relationships with them in other areas, so they're not new customers for us. The other area is federal, with Department of Defense and the FAA. We are the FAA facilities contractor. We won a re-compete last year for $1.8 billion, so work that gets done there will be under our contract. We hold all the contracts with the Department of Defense in PFOS, PFAS, with the Army Corps of Engineers and the Air Force in particular. Next area would be the municipal water area, so we have over 100 municipal water customers. Most of those came in through our IPKeys acquisition, where we're currently providing cyber compliance and monitoring for those water customers, but again, have that direct access. And then the fourth client area is airports, aviation. We've done over 450 airport projects all over the world. Again, we can readily support those customers with whom we've done business for a long time. Very excited about PFOS, PFAS market. Overall market, we expect to be over $200 billion. For Parsons, we expect $40 billion addressable to peak in 2032. I mean, just putting this into current terms, I mean, today, maybe you're in like the low $10s of millions, and you think that could spool up to, you know, severalfold that at some point? That would be our expectation. Okay. We're below $100 million today. Yeah, great. Matt, just stay with you on the segment side. This is the segment where you expect to see quite a bit of margin expansion. Can you just give us, you know, sort of the setup for this year, what changes and improves? And then as we think through the next two years, you know, how do you get maybe closer to that 10% level from the mid-sevens? Yeah. So to your point, CI is gonna drive the margin expansion every year, 40 basis points this year, 20 to 30 to follow. So think about, you know, 80-ish basis points from the CI business and then 40 to 60 every other year, 'cause about a 50/50 between the two businesses. And so, as I mentioned before, we had some challenge programs back in the 2010 to 2015 timeframe. We got into some construction jobs that have wound off, which is where Carey and I are very happy about. But getting through those programs is gonna be a big victory for us at the end of the year. Had about $38 million in write-downs last year between two major programs, and so having those behind us is a great story. On top of that, we're doing a great job, obviously, controlling costs, growing 30% and from on the top line, but controlling costs pretty effectively. So last year, SG&A, as a percentage of revenue, is over 16%. This year, Q1 was about 14%, so getting some benefit there. And then, as Carey mentioned, you know, supply and demand is, you know, without a—with, with the amount of work that's going on, both in North America and the Middle East, we're just able to be a little bit more selective, find the jobs that are, you know, can support higher margins and bid those appropriately. And then our M&A, we always buy companies greater than 10% EBITDA, whether it's on federal or critical infrastructure side. So if we think about, I guess, that, the walk you gave, Matt, you'll have the write-downs going away, and so that'll be a tailwind to this year's margin. And so maybe that's like a step up, and then thereafter, you think it's more a function of pricing and scale on your SG&A? Pricing and execution, yeah, absolutely. Great. Well, I think we're at time, but one last question. M&A, you just started to mention it, Carey. It's a big part of your model. You're sort of striving to do one to three deals a year. You've done, you know, we talked about Sealing Tech. We didn't talk about Xator, but that's been a home run of a deal. Done a few deals on the critical infrastructure side, too. You know, what are you seeing in the pipeline? Where do you want to grow more? I mean, if we're thinking federal solutions, do we expect you to get deeper into enterprise IT, or is it sort of focus capabilities? And then critical infrastructure, is that a function of just, you know, sort of growing your headcount in the right areas? Yes, we've done 11 acquisitions over the last 6 years. 9 have been in federal, 2 have been in critical infrastructure. We strive for companies that are growing greater than 10% top line, greater than 10% EBIT DA margin. We actually don't do enterprise IT, and we're gonna stay kinda out of that area, but our focus will continue to be on cyberspace, missile defense, information operations focused against any near-peer threat. Continuing to buy for capabilities. We don't buy for scale, and I think we've proven that we don't need to buy for scale. We've been able to win the very large jobs because we're technologically differentiated. On the critical infrastructure side of the house, we're gonna look for digital transformation type of companies, similar like an IPKeys, and then also companies that have locations in key states. We have five Tier One states: California, Texas, Florida, New York, and New Jersey. Those states are gonna receive a lot of the funds that are coming out of the formula funds based on their demographics, so continuing to double down on those. Good pipeline in both areas. I would say we see higher tech companies on the federal side, and even if we buy into federal, we apply that technology across the board. Artificial intelligence is a great example. You know, back in 2019, we bought Polaris Alpha that does artificial intelligence. So we use that not just for the federal side, but we apply it in areas like advanced traffic management or energy response resource loading on the critical infrastructure side of the house. Great! Well, I think we will leave it there. Carey, Matt, thank you for your time. Thanks, Bert.