Greetings and welcome to the ABM Industries Inc. Q3 2020 earnings call. At this time, all participants are in a listen-only mode. A brief question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star, zero on your telephone keypad. As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Susan Kim, Vice President of Investor Relations and Treasurer. Thank you, you may begin.

Thank you all for joining us this morning. With us today are Scott Salmirs, our President and Chief Executive Officer, and Dean Chin, our interim Chief Financial Officer. We issued our press release yesterday afternoon announcing our third quarter and fiscal 2020 financial results. A copy of this release and an accompanying slide presentation can be found on our corporate website. Before we begin, I would like to remind you that our call and presentation today contain predictions, estimates and other forward-looking statements. Our use of the words estimate, expect, and similar expressions are intended to identify these statements. These statements represent our current judgment of what the future holds. While we believe them to be reasonable, these statements are subject to risks and uncertainties that could cause our actual results to differ materially. These factors are described in the slide that accompanies our presentation as well as in our filings with the SEC. During the course of this call, certain non-GAAP financial information will be presented. A reconciliation of those numbers to GAAP financial measures is available at the end of the presentation and on the company’s website under the Investor tab. I would now like to turn the call over to Scott.

Thanks Susie. Good morning and thank you for joining us on today’s call to discuss our third quarter results. As you saw in our press release, we reported revenues of $1.4 billion for the quarter. While this represents a 15% decrease versus last year, the aviation segment contributes more than half of that decline, as you’d probably expect. Excluding aviation, revenue was down less than 8%. In addition, we saw trends improve as the quarter progressed across all of our other segments, and we saw another record quarter of pandemic-driven work orders particularly within the business and industry and technology and manufacturing segments. This offset some of the scope reductions that occurred with client disruptions and modified operations due to reduced occupancies. We also expanded with key strategic accounts and other essential operations such as manufacturing facilities. Even within technical solutions, site access improved as the quarter advanced and we were able to restart churning through our strong backlog, so revenue has been resilient for us especially when contrasted against the reduction in commerce during the quarter. Because of the dynamic nature of how our direct labor is structured, where we experienced scope reductions we aligned staffing to match the work. This preserves margin and can even enhance it as we find efficiencies through labor strategies and other tight controls. Our quarterly performance also reflected some difficult decisions we made early on to prepare us financially for the uncertainty of the pandemic, which was right in front of us. At the beginning of the quarter in May, we instituted temporary reductions in salary across certain staff and management which included the executive team and the board. We also temporarily furloughed and reduced hours for certain corporate staff. Unlike many firms, we reduced or suspended benefits such as our 401-K matches.…

Thanks Scott. Before I review our financial performance for the quarter, I would like to acknowledge our exceptional finance organization for persisting through another quarter end. Our teams continue to deliver during these complex times and I’ve never been prouder to be a member of this team. In addition, I wanted to express what a pleasure it has been to meet and connect with many of you on this call over these past few months. Now for our quarterly results. Revenues for the quarter were $1.4 billion, a total decrease of approximately 15% compared to last year, reflecting a full quarter of COVID-19 decreases in most of our business segments. Partially offsetting this revenue decline was record demand for work orders, which are the higher margin services we have been providing through the pandemic. Work orders were particularly elevated in business and industry and technology and manufacturing. GAAP income from continuing operations was $56 million or $0.83 per diluted share compared to $36.5 million or $0.55 last year. Our current results reflect an $8.5 million favorable impact related to prior year self insurance reserves. We continue to see improvement in claim trends and we are encouraged by the sustained impact from our risk and safety program. On an adjusted basis, income from continuing operations for the quarter increased to $50.1 million or $0.75 per diluted share compared to $40.2 million or $0.60 last year. On a GAAP and an adjusted basis, we achieved earnings growth versus last year as a result of higher margin revenue mix due to a significant increase in work orders and our ability to achieve efficiencies by aligning labor with decreased legacy services. Additionally, as Scott referenced, we implemented temporary salary reductions, furloughs, and reduced hours for certain corporate staff and management. These actions contributed $18…

[Operator instructions] Our first question comes from the line of Tim Mulrooney of William Blair. Please proceed with your questions.

Scott, Dean, good morning. Congrats on a great quarter.

Hey, thanks so much.

Thank you Tim.

Yes, so a couple questions here. First of all, your consolidated EBITDA margin expanded by 230 basis points in the third quarter. Can you talk a little bit about how much of that was from higher margin EnhancedClean work versus labor efficiencies versus furloughs, and as I’m thinking about these three buckets, can you share with us what that implies from a broader perspective when we’re thinking about your longer term EBITDA target margin range of 5.6% to 6%?

Thanks Tim. As you would expect, our 230 basis point margin expansion had puts and takes. First, I would like to describe the positive items that drove on a gross basis 320 basis points. During the quarter, as we described, we had temporary salary, furlough and work hour reductions that had an impact of 130 basis points. Also included in the 320 basis point gross was the impact of labor efficiencies as we managed the COVID revenue compression, the significant higher demand that we had from work order demand, and there were also certain fixed overhead costs that we were unable to leverage during the quarter, as you would expect. Also in this 320 basis points was 100 basis points related to bad debt as we continued to monitor our credit worthiness for certain clients, and also our investment in EnhancedClean.

Yes, and what I would add, Tim, too is that when you think of even the medium term now and what this means for us, we’ve talked in the past about the right zone for us, so we would say the golden zone was 5.5% to 6% EBITDA margin, and I think what this does--what COVID’s doing is accelerating that for us. We are really enthusiastic about where we’re heading, and there’s been certain disciplines that have happened within our organization through COVID in terms of SOPs - standard operating practices, so we’ve talked over the last few years of 2020 Vision about how difficult it is to ingrain really foundational changes in terms of getting 300 branch offices to adopt standard operating practices. Well, we’ve done it through COVID, and we talked a little bit about this last quarter, about our pods or our task force that was set up to manage collections, payables, labor, and that rigor has really resonated with our employees and they’re really seeing the benefit of it, so we’re going to continue with that muscle strength. That’s really going to inure to our benefit down the road. Then with EnhancedClean, there is going to be embedded EnhancedClean going forward. I don’t think anybody can imagine going back to an office and talking to the landlord of the office building or to your head of facilities and them saying, we’re back to normal, there’s no more virus protection. I think that’s going to be completely embedded going forward. Then even as we re-staff the buildings, we think we’re going to find efficiencies as floor plates expand, so we’re truly optimistic about our ability to maintain the margins in that 5.5% to 6% range. Then the big question will be, do we break out past that 6%, and from our perspective it’s just too early right now to determine that.

Okay, good color. Thank you. Sticking on this subject of EnhancedClean, in your press release you highlighted we had a lot of higher margin work in the quarter. My question is, and now I’m thinking about your B&I and your T&M segments, how much of that higher margin work was emergency work and how much do you think is here to stay? In other words, how much of it do you think was one-time CAG work versus the longer tail EnhancedClean type work?

Yes, you may not like this answer but I have to tell you, it’s just too early to tell. I think generally speaking March was the month which was part of Q2, where there was a lot of reactive work, right? I think for this quarter, it was more programmatic in the hope that it would create safety and people wanting to get back. I think the real test for us, Tim, is how much of this will be embedded into the future, and for us to hit the $100 million sales mark in EnhancedClean--remember, EnhancedClean is different than work orders. EnhancedClean means I want to put a program in place in my property for six to nine months - that’s kind of been what it’s been averaging, so we think it’s the tip of the iceberg. Aspirationally, do I want to see that double next year? I do, so I think the big thing is that virus protection is here to stay, whether you’re educational facility, whether you’re an airport or you’re an office building. You can’t move into the future without a program that’s going to make people feel safe, so we’re optimistic. I think it’s a little early. I believe by next quarter we’ll have probably a better window into how much of this we’ve gotten embedded into that six to nine-month range of EnhancedClean.

Okay, great. That was a great answer. I think I understand how it’s laid out now, more of it--more EnhancedClean type work this quarter than last quarter, so transitioning some of that short emergency CAG work into the longer term, higher margin EnhancedClean. That makes sense. If I could sneak in one more, Scott, because I really wanted to get your answer to this, or at least hear your thoughts on it. I think the biggest issue with investors right now is trying to gauge how many of your B& customers will remain customers if work from home become a more permanent fixture of our society. I know it’s a debate that everyone’s having right now. We recently heard Netflix’s CEO say he wants everyone back to work as soon as a vaccine is discovered, but others may be thinking differently. How are you thinking about this dynamic right now and how it might ultimately impact your business? Thank you.

Yes, so I am not wish-washy on this. I have very strong opinions. I used to be a facility manager - I ran facilities for Goldman Sachs, for Lehman Brothers, and managed facilities for CBRE, so I have a little bit of background on it. I will tell you I am so optimistic about the future of office. You start looking now online at all the employee surveys that are circulating around. People want to get back to work. People recognize that collaboration is an important part of their work experience and, frankly, their lives. In my CEO networks, from all the different CEOs I’m talking to across the country, we’re all starting to talk about the culture that makes each of our companies so special and how important it is to develop employees. We want people back, people want to come back, so again--and I’m not sure how you create a strong company with a distributed management team. It doesn’t make sense to me, and I think you combine that with the fact that even if there is a shift--let’s just say there’s a 25% shift in work from home, which I don’t believe will happen, but even if you do that, when you start distancing the floor plates, we have heard tenants talk about having to take 50% more space to get to where they want to be, where they ultimately want to get to for distancing. I can tell you I had a conversation with our internal head of real estate yesterday about whether or not we take some of our sub-tenants’ space in our office so that we can create distancing. I’m super optimistic about office space and I’ll give you some firm facts. In 2010, the average square foot per person in an office building…

Yes, it makes sense to me, Scott. I’m really glad I asked. Thanks for your perspective. I’ll hop back in the queue.

Thanks Tim.

Thank you. Our next question is coming from the line of Andrew Wittmann of Baird. Please proceed with your question.

Great, thanks. Good morning and thank you for taking my questions. Maybe just a couple here. I guess I wanted to start with some of the new sales, Scott, that you mentioned. In your script, you said a billion dollars, you’re basically a quarter ahead of plan, you’re usually a billion by year end, but things are doing well so you gave us a third quarter update here. Can you just talk--I guess maybe give some context on this one, how much of that is recurring work that’s contractual, recurring work in what I’d call your annuity businesses versus work that’s in your technical solutions, which would be a little bit more project focused? Also, just given that we’re asking about technical solutions, you gave a backlog number for the first time. I was just wondering how that $170 million backlog that you disclosed compares to the backlog a year ago at this time.

Yes, so I think a majority of our sales has been on the annuity business--you know, of the billion dollars, by far the majority. The ATF business just started picking up towards the back end of the quarter. We’ve just been seeing great demand. What it really proves, Andy, is that if you make this investment in the sales culture, it really pays off. You know, we furloughed some of our sales people and we put them on reduced hours. We did all the things that we thought were responsible things to be doing in light of the uncertainty at the start of this pandemic, and even with that we sold because you have to remember that our sales don’t just come from sales people, they come from operators in the field talking with clients and expanding footprints. I can tell you candidly, I’m blown away that we would hit a billion dollars in sales in August, in this year where so much of commerce--not only has commerce stopped, but the focus hasn’t been on that from facility managers and from landlords. That’s not necessarily been their focus. The focus has been getting people back, so to hit this mark is just--it just speaks volumes to what’s going on at ABM. I just couldn’t be more proud of that. I think that’s one of the standout statistics for this quarter, is to put on a billion dollars in sales in August in this crazy year, I mean, has to be a standout point.

And Andy, I would add to what Scott said, that in the past we’ve talked about a healthy backlog being in between $150 million to $200 million, and I also wanted to remind you that last year at this time, we had two really large deals that closed that extended that healthy range above, so this year slightly down, however with the pandemic and the stoppage and new sales, I really don’t think it’s a comparability--equal comparability over year when you compare where we are today versus last year.

That’s helpful context on those. I should have asked about your retention rates, Scott, in your annuity businesses. It sounds like the adds are churning very strongly. During COVID, it seems hard to believe that there’d be a lot of churn out of the portfolio, but could you just comment on the retention levels that you have seen in the last three months?

Yes, we’ll be really transparent and tell you we’re not taking credit for it, because there hasn’t been a lot of activity, right? It’s all been about stasis of operations, so--but I will say what we’ve done through COVID in terms of our EnhancedClean program and being there for clients, and no small thing, Andy, but our access to supply chain, because you know as well as anybody we’re dealing with smaller competitors in each market, and they just did not have the same access to supply chain. I think I mentioned on the last call, we put in an order for $15 million worth of electrostatic sprayers, which is the equipment that disperses the disinfection chemicals, we put in an order for $15 million of electrostatic sprayers and chemicals and we had access to supply chain and we did not let our customers down. When I think of retention, I think the big test will be next year. Did we rise above, did we create such a standout with clients that--again, that our bigger clients say with ABM, one thing we get is surety. We get surety because they have the access, they have the scale, and just having an advisory council. I can’t tell you how many of our clients will call us now and say, I’m reading the CDC, I’m reading the stuff from the World Health Organization, can you help me understand that? When you have your own advisory panel, which we cannot think of another small competitor that has one of these, I just feel like--you know, we’ve always talked about scale and does scale really matter in our business, it’s such a local business. I think the one thing that this pandemic has proved out is that in what we do, scale matters. There’s nothing else from a resource standpoint between supply chain and having an advisory council.

My last question for now is on the education segment here. I guess in the quarter, it’s mostly the summer season in your third quarter, it’s kind of half in session, half summer, so I want to be careful about extrapolating the decline in revenues - I guess you were down about 12% year-over-year in the quarter, into the fall school season. I’m just curious as to what you’re seeing in terms of the reopening performance so far, recognizing that anything can change with new COVID cases - that point’s not lost on anyone, but a lot of schools are trying to start at least partially in session. What’s the current outlook as it stands today about the revenue performance, and does the revenue performance that you’re seeing today have any implications on what your margins for this segment can be?

Yes, that’s a good question. Just to give you kind of a frame of reference, right now within our portfolio, and 50% of it is K-12 and 50% is higher ed, what we would say across the board is--so now with the ABM portfolio, 85% of our business is either hybrid or in-person, and 15% is online only. We’re studying, and literally Andy day-by-day, we’re studying the trends of what’s happening with schools and whether or not they are continuing on in either hybrid or in-person, or they’re gravitating to online. But you know, we’ve been relatively stable at this rate in terms of revenues because--you know, the analogy I use is at the University of Miami, which has this magnificent campus, lush, we do the landscaping there, we take care of their healthcare buildings, all of the student facilities, even if they go 100% online, they’re not going to padlock the campus, right? You still have to take care of the facilities, and a lot of the online stuff that’s happening, it’s happening where the teachers are going inside the classrooms, so you have to disinfect. I feel like there’s going to be some stability there, at least through the fourth quarter. The real question is going to be when you look at our fiscal ’21, what is going to happen for that next semester, the spring semester that starts, I guess in January. Will they have lessons learned from this semester as to how they want to approach it, and that could create some variability for us. But that segment’s been pretty resilient. I mean, to be 12% down in revenue given the fact that most of this quarter, the schools were actually closed, no one was attending, we feel like--we feel really good about that segment.

Okay, great. Thank you.

Sure.

Thank you. Our next question is coming from the line of Sean Eastman with Keybanc Capital Markets. Please proceed with your question.

Hi team, compliments on another great quarter.

Thank you.

Scott, I just wanted to start on any puts and takes you can walk us through as we think about next year - you know, tough comps, easy comps. I think in particular, it’s clear that you guys have done a terrific job around the labor management piece on the downswing, but as we think about a scenario where the operating environment is returning to some normalcy, we’re getting some recovery in the top line, how to think about your ability to manage labor on the upswing relative to the downswing, and what point we start to need to fold back some of the back office investment programs you guys have talked about over the past several quarters. Any puts and takes around next year in the context of those items would be helpful.

Sure, and there’s a lot to unpack there in that question. It’s complicated, right? If you think about ’21, our comps, they’re going to be impossible because Q1 had no COVID, Q2 had just March but it was a crazy March because everyone was trying to figure out if they could keep people, because we didn’t really understand the pandemic then and it was all about a heightened amount of disinfection and oversized work orders, so Q2 was a little funky. Then Q3 and Q4 will have full COVID, so it’s going to be hard to do quarterly comps for next year. But I do think there is an opportunity for us as tenants, as employees start returning and we start building back our staff, I think we will get efficiencies. You always get efficiencies when you get a chance to rebuild. In our business, we call it re-sectioning the building, because people have sections. That’s what they call an office building with different floors, so that’s the term of ours, so as we re-section the buildings and grow, I think we’ll create some really good labor efficiencies there on the way up. Then another really important piece of this, Sean, is the labor situation. For the last two years, we’ve been dealing with unemployment at 3% and it’s been impossible to get labor. We’ve told you guy anecdotal stories about how you need to get 10 people through the interview process to find one as a janitor, and with unemployment where it is now, double-digit unemployment, I think what’s going to happen is the supply side will be really good for us in terms of trying to find people. I think unfortunately for the economy, it really hit the hardest on the people that want to come work for ABM - you know, the restaurant segment, some of the retail segment, so I think it’s going to be opportunistic for us. Then the last piece of it is not only supply but actually the cost of labor, and we don’t see that being a tailwind. We don’t think that labor costs are going to go down because of the unemployment - we think that will kind of stay where we are, but I think it’s going to be a really good tailwind for us in terms of the supply side. Dean, I don’t know if you have anything you want to share on that, but we’re feeling pretty good about that.

Thanks Scott. As a reminder to everyone, in the fourth quarter we will have one less working day, and as we look into fiscal year ’21 on an overall basis, we will also have one more day, but the distribution of that through the quarter will be as follows. In Q1, we’ll have one less day, in Q2 we’ll have one more day, and then in Q3 one less day. I also wanted to point out that we all read about how states have deficiencies, and so we expect an increase in the [indiscernible] rate for next year. Not quite sure exactly what that rate will be yet, and also we will look to have conversations with our clients as we see an uptick in that rate. More to come on that in our year-end discussion.

Okay, really helpful responses. Maybe just in a similar vein around free cash flow, clearly really excellent job done getting cash in the door in fiscal ’20. You did call out the $44 million CARES Act tax deferral - I guess half of that becomes a headwind for fiscal ’21, but any other puts and takes around free cash flow generation we should think about for fiscal ’21 relative to fiscal ’20?

Yes Sean, I’ll start off with a few comments there. As Scott mentioned, we talked about the pod structures that we established in the pandemic and we will continue to utilize those pod structures to have a disciplined approach utilizing standard operating procedure to collect cash. As you mentioned, we’ll also continue to get the deferral of U.S. payroll taxes during the quarter and would approximate equally about what we had in this quarter. Then as Scott also mentioned, as we look to align our strategic priorities over the next few months, we wouldn’t expect a material change in capital expenditures from Q3.

Yes, and before we let this one go, I have more of an emotional response to this because I am so proud of what this firm has accomplished. To have historic free cash flow in this time where, again, commerce has shut down, I’m sure people or companies around the country are struggling with maybe paying bills - we know what we read, right? For our team to be so vigilant about collecting cash and being on it and just the rigor involved, it’s just incredible. I talk to other companies in our space and even outside of our space, and the first thing they talk about is liquidity and cash flow and how we have to stay on it, and it’s almost embarrassing about how well we’re doing. So I am so proud of what we’ve done and how seriously our people have taken the concept of collecting cash, and again as Dean mentioned, this is a muscle strength we are not going to let go. I am so enthusiastic about what we’ve done and where we’re going on cash. Another amazing highlight of this quarter.

All right, I’ll leave it there. Thanks very much for the time.

Sure.

Thank you. Our next question comes from the line of Marc Riddick with Sidoti & Company. Please proceed with your questions.

Good morning everyone. I wanted to touch on EnhancedClean and get a sense of client receptivity. I was wondering if you could spend a little bit of time on the types of businesses or particular areas or what have you, that were maybe most receptive to the service offerings, as well as maybe if you could touch a little bit on--you mentioned this six to nine month time frame, how should we think about those future renewal or extensions? How should we think about how that might then proceed for a client who’s signed up?

Yes, so we’ve seen receptivity across the board on EnhancedClean because when you really strip it back, it’s like are you going to do disinfection work to protect against COVID, so you couldn’t imagine anyone, any landlord or any facility manager saying we’re not going to do anything. Everyone is doing, and it’s a question between--and I may have said this a little earlier, it’s a question between do I want to think about it on a temporary basis, like I’m going to give you a work order for a month, or do I want to make this more programmatic, and the programmatic stuff is the EnhancedClean six to nine months. I think that’s probably for now a proper time horizon to--so here’s the way you should think about it. Work order, very reactive, let’s think about this on a temporary basis. EnhancedClean, bridge to a vaccine, bridge to getting people back. I want to put a program in place over the next six to nine months to start thinking about getting people back, and then ultimately when we’re talking two or three years from now, we probably won’t be talking about EnhancedClean anymore. We’re going to have specifications when contracts are bid that are going to incorporate regular disinfection, which as you know is a higher margin service for us. It will gravitate from calling it EnhancedClean to say, oh, the specification of the future is going to include doing the things that we used to do in a bathroom and a pantry in general office space. The reason it’s still kind of in its infancy for us - I mean, $100 million is spectacular right out of the box for a quarter, but not every facility manager understands the plan for re-occupancy yet, so as facility managers, as…

Okay, great. That’s very helpful. Then I was wondering if you could--I wanted to circle back to education for a moment and get a sense of the--I think you’d mentioned this a bit, but I just wanted to get a sense of maybe the differences of activity around--you touched on K-12 versus higher ed. I wanted to get a sense of are--it seems as though there would be deeper pockets in the higher ed area to maybe be more active on implementing something like this, so I was wondering if you could touch on maybe the funding environment that you’re seeing and whether or not that could have an impact on the timing of when these things are brought onboard. Thanks.

Yes, I think within our industry group of education, I think it’s still a little early because on the K-12 side, we’ve seen so much in term of budget cuts. You read about it in the paper all day about how school budgets are being cut, but again, let’s think, right? If school budgets are cut, can you really cut cleaning? That’s the one area that you know is going to be sacrosanct for superintendants. Then same thing with higher ed - how could you cut cleaning? That’s the one area. You may want to cut food service, you may want to cut--you know, there’s so many other places to look at where you’re going to make cuts, other than cleaning, right? But also, think about our technical solutions space. Our target market is education, so we are seeing so much activity especially on the K-12 side right now with superintendants calling and us actually reaching out to say, look, I know you’re having a budget deficit, we can come in and do a retrofit of your electrical mechanical systems. Typically we find 30% energy savings - that’s enough to save teacher jobs, to save afterschool programs, so the budget cuts interestingly enough are going to be a big tailwind for our technical solutions business as they find ways to save money and save teachers’ jobs. Those budget cuts for our industry group, education - again, I just will say I can’t imagine a world where they go back to the PTA or the school board and say, we’re making cuts to our cleaning program. I just can’t see it.

I appreciate it. Thank you very much.

Sure.

Thank you. We have time for one more question. Our next question is coming from the line of David Silver with CL King. Please proceed with your questions.

Yes, hi. Thanks. Just a couple of areas I’m going to ask you maybe to go back on, but I did have a question about the marketing effort or the go-to-market strategy for EnhancedClean. Just me personally, I’ve seen the advertising online and in industrial marketing. You touched on maybe the spend at one point in your remarks for this program. Is there any way that you could characterize, either qualitatively or quantitatively, is the rollout and the marketing for the EnhancedClean service, is it significantly different than other marketing programs that you’ve done, either in the vehicles that you use to disseminate the advertising or the groups you’re reaching out on? Then just qualitatively, if you could talk about the split between new customers, customers you didn’t do business with that are responding to EnhancedClean, versus maybe cross-selling to your existing client base? Thank you.

Sure. This is nothing like anything we’ve ever done at the company in terms of a true product rollout, service rollout. We’ve never been on social media the way we are now, so we’ve hired a proper advertising agency and PR firm. We are doing this the right way. We see so much opportunity in EnhancedClean, and I’ll give you a point of reference which is so interesting. Tomorrow we’re doing a webinar. Part of the advertising you’ve seen on the social channels is that we’re doing a webinar with our expert panel to tell clients how to get back safely. We view the webinar as something that could be a good resource for clients but, more importantly, it’s part of advertising, right? It’s part of how you position your brand as a knowledgeable brand and we can do a webinar, and we said, you know what? Even if we get 50 people, it will be mission accomplished because it’s really about seeing the advertising, less about the webinar itself. We are going to have--so we track obviously the registrations, and again at the outset we said if we can get 50 people, 50 important people, that would be great. We’re close to 1,000 people that have registered for this webinar already, which has blown us away. We’re tracking metrics, we’re tracking hits analytically that go to our website for new customers and even existing customers are tracking it through. I think it’s too early to give you the split now of new customers versus existing customers. We’ll have definitely more insight in Q4 once the campaign has gone through one cycle, one quarter. It’s like nothing we’ve ever done and what we’re really hoping is that taking this approach, really leveraging social channels is going to be game changing for us and really change the demand set. It’s too early to tell, but again to go back to it, we’ve never done anything like this before. We’re so enthusiastic about it.

Okay, thanks for that. This next question, I apologize - I’ll try to keep it together, but I’m kind of pulling some data points from some other areas. The question might be, Scott, where you see the company, let’s say three years from now, so safely after the pandemic induced shifts and uncertainties have passed. You mentioned, and I have this figure in my head, 140,000 employees; you’ve mentioned a particular margin target, EBITDA margin target that’s above your historical level but below maybe where you’re trending shorter term, so this is a question whether you see the company evolving towards one where you’re going to pursue very aggressive top line growth or maybe alternatively one where you aggressively high grade and target your efforts and your labor and other resources and drive the operating margin line and maybe returns on capital. So three years from now, will you have more than 140,000 employees and now 5.5% or 6% margin, or will you have fewer and a higher margin than what the current target was? Thank you

Yes, it really is tough to speculate. I would suspect we’d be growing on all levels - you know, revenue, I think we’ll be growing on margin. We are going to be making investments in our IT infrastructure and digital. I think this is going to give us an opportunity to kind of leapfrog our competition on client-facing technology and analytics. Again, we learned through COVID how our scale matters, and I said it before on supply chain and on our advisory council, and now we’re recognizing if we could put technology in place, digital technology to connect with our customers to get stickier, we think that’s going to really drive some incredible value, especially as Internet of Things starts taking shape. We are going to stick with our operational proficiency - that’s going to be super, super important for us. We’re going to stick with the rigor and discipline around standard operating practices like cash collections, but we are going to invest in this company in sales people and in our IT platform.

David, this is Dean. Just wanted to add onto Scott. We’ll continue to be focused on our capital allocation strategy, which has historically been organic investment, looking or maintaining our longstanding dividend policy, and being opportunistic and thoughtful about M&A and share buybacks. As we look into the three-year period, looking at our capital allocation holistically, we’ll continue to do that.

That’s great, great point.

Okay, thank very much. I appreciate it.

Thank you.

Thank you. That does end the question and answer session. I will now hand the call back over to management for any closing remarks.

Just want to thank everyone for their time, and again hopefully you got the tenor of this call. We are super enthusiastic about where this firm is heading and our value proposition through this pandemic and our brand elevation. I just can’t say enough about it. The way this team has performed, it’s across all platforms whether it’s maintaining the resiliency of our revenue, our profit margins, our free cash flow, our new sales, EnhancedClean initiatives. We just feel like we’re firing on all cylinders and the management team has just really risen up. I’m just so impressed with what our team is doing and so excited, so more to come in Q4. We’re heading in a lot of parts of the country into the colder weather, so you’re going to be more indoors. Don’t let your guard down. Stay safe and healthy, practice social distancing - it’s super, super important. I appreciate the patience on this call and going though with us, and again have a great all, everybody. Thank you so much.

Thank you. That does conclude today’s conference. You may disconnect your lines at this time. Thank you for your participation and have a great day.