Ladies and gentlemen, thank you for standing by and welcome to the Second Quarter 2020 Kforce Inc. Earnings Conference Call. At this time, all participants are in a listen-only mode. [Operator Instructions] I would now like to hand the conference over to your speaker today, David Dunkel, Chairman and CEO. Please go ahead, sir.

Good afternoon. I would like to remind you that this call may contain certain statements that are forward-looking, including statements regarding the impact, opportunities and benefits from actions taken related to the COVID-19 economic and health crisis. These statements are based upon current assumptions and expectations and are subject to risks and uncertainties. Actual results may vary materially from the factors listed in Kforce’s public filings and other reports and filings with the Securities and Exchange Commission. We cannot undertake any duty to update any forward-looking statements. You can find additional information about this quarter’s results in our earnings release and our SEC filings. In addition, we have published our prepared remarks within the Investor Relations portion of our website. Our focus on providing critical technology talent to world-class companies as well as the ability of our FA business to support large-scale, critical government-sponsored COVID-19-related initiatives in addition to our core FA footprint allowed us to grow revenues 1.2% on a year-over-year basis against the backdrop of an unprecedented macroeconomic landscape resulting from the sudden and dramatic effects of the global pandemic. Our strong performance in the second quarter is a testament to the longer-term strategic decisions we have made to position Kforce for success and significantly insulate the firm from the consequences of the economic disruption. We have worked diligently over many years to shed non-strategic businesses, which has resulted in, roughly 80% of our revenues being concentrated in high-end information technology staffing and solutions. This decision was supported by our belief that the technology staffing and solutions market would exhibit very strong and stable long-term demand that would have very limited economic sensitivity due to the critical need for ongoing technology investment, particularly in industry leading world-class companies. While nobody could have foreseen this severe of an event…

Thank you, Dave and thanks to all of you for your interest in Kforce. The journey that Dave mentioned is an overall focus by shedding non-strategic businesses to take greater advantage of the secular shift in technology demand and to limit our exposure to the highly cyclical Direct Hire business is providing significant level of resiliency to our revenues as demonstrated by our second quarter results and early third quarter trends. Our overall revenue growth in the second quarter on a year-over-year basis of 1.2% and the performance in each of our lines of business exceeded both internal and Wall Street expectations. Let me give you a little bit more color in each of our lines of business. With respect to our technology business, Flex revenues declined 3% year-over-year and 4% sequentially. As noted on last quarter’s call, we didn’t see notable impacts from the COVID-19 crisis until late March and into early April. After the April impacts of decline from these businesses directly affected by the pandemic, our weekly trends were largely stable throughout the remainder of the second quarter. Since mid-June, we’ve seen modest growth in our billable headcount. For the month of July and on a year-over-year basis, Technology Flex revenues were down approximately 2%, though these declines may increase slightly for full quarter against the more difficult prior year comp. Search activity and job order flow have begun to increase over the last several weeks. They remain lower than pre-pandemic levels. While job orders are lower than pre-pandemic, the quality of the job orders is higher as clients seek to stop critical roles. Our internal metrics and revenue trends point to an improving environment. If trends continue, we will see third quarter sequential growth in Tech as the higher skill set work, which is being done…

Thank you, Joe. Revenues of $343 million in the quarter grew 1.2% year-over-year and earnings per share of $0.47 declined 28.8% particularly due to a decline in gross margin and higher SG&A costs related to retention of critical infrastructure and resources. Our gross profit percentage in the quarter of 28.4% decreased 140 basis points year-over-year primarily as a result of a lower Direct Hire revenue mix. Our Flex gross profit percentage of 27% improved 10 basis points year-over-year despite the negative impact from the higher mix of revenues from the COVID-19 business, which carries a lower overall margin profile. Flex margins in our technology business increased 70 basis points year-over-year primarily as a result of lower payroll taxes and consultant travel costs. Spreads in our technology business remained flat year-over-year and sequentially as improved spread from new managed services business has offset any pricing concessions provided to certain strategic clients during the pandemic. Flex margins in our FA business declined 240 basis points year-over-year, though approximately 120 basis points of this was driven by the lower-margin COVID-19 business. Spreads in our core FA business were down slightly essentially. Average bill rates in our technology business of $80 per hour increased 4.6% sequentially and 6.2% year-over-year. We believe this increase was driven in part by business mix as our clients are retaining the more highly skilled consultants given the scarcity of talent and the assignments that were ended at the onset of this pandemic were lower skilled areas, which were less capable of working remotely. New assignment adds in the quarter inclusive of the increasing mix of higher bill rate managed services business, were concentrated as well in higher bill rate skill sets. We saw a similar story in our core FA business, where average bill rates of $40 grew 4.6%…

Thank you [Operator Instructions] Our first question comes from Josh Vogel with Sidoti & Company. You may proceed with your question.

Thanks. Good evening, guys. Thanks for taking my questions. Pretty impressive results in this environment. My first question is, do you see any sort of scenario that even after the economy recovers that the government decides to keep some of these programs intact longer term unless you can sustain a level of this work, too?

Josh, this is Joe. I will take that question. Obviously, it’s hard to say what’s ultimately going to play out. I mean that’s the trillion-dollar question, right? But what I would say from what we have been able to capture from the government support, we are kind of comfortable where we are as a percentage of a mix of our overall revenue. So we are not currently actively pursuing additional opportunities. Mainly, as we have stated in – for quite some time now, our investments are going towards Tech with an emphasis really on that higher value-add, managed services, solutions-oriented type project work along with continuing to further evolve our FAs and the skill areas that are really synergistic with our Tech footprint in and around data and business intelligence in those areas. So how long this will run out is a question that we really can’t give you an answer to, but I wanted to give you a little bit more of that backdrop.

Yes. Joe, I am Dave. I would ask the question, if you could tell me when all of this ends that I can probably give you a better clue. We have been watching this go up and down for so long. The one thing that’s very clear is that nobody knows. And what we are seeing is the continued uncertainty is bringing additional flexibility. So because of our unique capability to be able to deliver at scale, what was approximately 5,000 people in 4 weeks utilizing our centralized delivery, as Joe pointed out in his prepared remarks, and also some of our own innovative proprietary technology, I mean what a remarkable story that is. And so overall, we are very pleased with the way everything is balanced and not knowing how long it’s going to last. I think we are very well positioned, as Joe said, that if, in fact, we do see an economic recovery, that’s only going to feed the core business and technology anyway. So we are in a good spot. Thank you.

Great. Shifting to Tech Flex, you had the business update in early June. I think you said it was down about 2% year-over-year but 3% for the quarter. So am I right to think that it was – it declined at a 4% to 5% clip in June and if so, what drove that?

Josh, I would say that was a point in time when we gave that, and that was very early on into COVID. So we experienced a little bit more deterioration kind of mid-quarter and then started to really improve as we moved to the back end of the quarter. So as we exited the quarter and as we enter Q3 here, we are pretty much in the same ZIP code of where the full quarter was. So I think it’s just really the timing of where things happened in the quarter.

Understood. And you said July or through early August, you were trending down about 2%. Is that in the earlier comments?

Correct.

Okay, great. The – when we look at the expectations built into your guidance and understanding it’s a fluid situation and you are only giving quarterly guidance, but maybe if you could give any sort of directional commentary when we think about Q4, and let’s just say hypothetically that the COVID-19 work is no longer contributing. Do you think that this will trend back up to historical levels as a percentage of revenue or what – or how much do you think you could sustain of these cuts longer term and what could be like more of a long-term run rate of G&A?

Yes. So Josh, this is Dave Kelly. A couple of things. You will note and I think we provided some data in the release that shows you the gross margin profile of this COVID-related business. And as you would expect, the profitability levels of that business are not at the levels of our Tech and our core FA business. But if you look forward, to your point about historical operating margins, actually if you look at a revenue composition that I think Joe stated, we expect to be between $45 million and $55 million for that COVID revenue in the third quarter and you look at the operating margins that we put out there relative to the revenue in the third quarter, not the fourth quarter, but earlier than in the fourth quarter, we actually are approaching the profitability levels that we had had pre-pandemic. So we are very pleased with – even at this composition of business, how we are operating and obviously, as the business mix for us changes and Tech starts to grow, relatively speaking, and FA, which is certainly a more profitable, higher bill rate revenue stream, we are in a very great position to continue to improve profitability. So you mentioned in the fourth quarter, I think, important to take a look at the third quarter and the profitability levels we are expecting even in the third quarter.

Okay, thank you for the details. And just lastly, you did talk about debt repayment, but can you just talk about your capital allocation strategy in general, where it stands today in terms of properties?

Yes. So I will restate what I said in the prepared remarks as we think about the near-term. We certainly want to be cautious. We are in a position with very low debt levels. But I had indicated as we look to generate cash, again, strong cash flows in the third quarter, we expect to continue to pay down debt. But we have got great flexibility. We think it’s good right now to be cautious in terms of capital allocation, all those things, as we have always talked about in terms of returning cash to shareholders, acquisitions, thinking about opportunities on the table when we think the time is right. But we think prudent right now to be cautious.

Thank you for taking my questions, guys.

Sure. Thank you, Josh.

Thank you. Our next question comes from Tim Mulrooney with William Blair. You may now proceed with your question.

Good afternoon. I wanted to build on one of the previous questions that was asked, but not on the top line trends but rather the bill pay spreads. Can you just talk about how the bill pay spread moved sequentially through the second quarter and into July?

Sure. Happy to do that, Tim. This is Dave Kelly. So if you look at – I made a commentary here on Tech, in particular. Again I think a very positive story. As we look sequentially, we have seen increasing bill rates because of, as Joe mentioned, a higher concentration of higher skill set business. But in spreads themselves, as we look sequentially, we are actually stable. We had – I talked in the last call as the pandemic started that we had had some requests from strategic clients for some near-term concessions. I haven’t seen a lot more of that, but obviously, that impacts spreads in the second quarter, and that has been offset completely if you think about flat spreads with some of the higher-margin new business that we have had. So we feel very good about where spreads were in the second quarter sequentially. And our commentary suggests we think those are going to be stable as we move in the third quarter for Flex – for Tech Flex. Obviously, FA, the spreads in the aggregate are impacted by the COVID business. But feel good about the stability as well in the historical core FA business for spreads to remain constant as well as move into the third quarter.

Okay, that’s encouraging. And on that COVID-related revenue, $45 million to $55 million I think you said you expect to see in FA Flex in the third quarter. Is that a continuation of the $35 million of the government work that you did in the second quarter or are these completely separate projects and clients?

Yes. No, they are the same projects that we have been working on, that you are just selling the full reflection of those projects being fully staffed for the quarter.

Okay, thank you. Lastly, just a broader question, so you talked a lot about how digital transformation is driving incremental business right now, which makes sense. I was wondering if there were any concrete examples that you could provide of the type of work that’s being done right now to support client needs as they try to support their clientele and their employees?

Yes. It’s a great question. And I wouldn’t say that this is a near-term incremental, so I want to be clear there. Because I think what you really have to do is you have to look back to 2008, 2009 as that was really a turning point with the advent of smartphones coming about, areas such as mobility, cloud, along with the security ramification, they were in their infancy back in 2008, 2009. So I mean, the entire world has moved online, and I am not talking just Internet online, but the way that all businesses are interfacing with their customers, their distributors, their vendors, how they are even interfacing with their internal people. I mean we are personally experiencing this front and center. So I think you almost have to think of this in terms of the customer journey and leveraging technology in a mobile cloud base and interfacing wherever there is possible opportunities to really enhance or optimize that client experience, whether it’s acquisition of a product or service, how you are processing payments, billing, all those dynamics, the support, I mean. So it’s really an end-to-end experience. So these – what’s happened with COVID is, it’s really only accelerated what was already underway in terms of data – this whole digitization. And then on the back end of this, you have the whole data aspect, which is really – everybody is trying to figure out how do I get after my data to enhance my decision-making, how do I get after that to enhance the overall customer experience. So I would really say to sum it up, this has really just been an accelerator of all these digitization activities. I mean we continue to see clients they are hiring, what I would really consider more transformational roles with the high percentage of these being really more senior level, and they are directly linked to accelerating that digitization experience and it’s really that consumer direct-type relationship and then enabling the whole remote work environment with mobility and cloud at the forefront. So it’s much broader than something that’s incremental.

Tim, this is Dave Dunkel. I want to add something to that, too. I mean, another major factor is the disruptors that have come in to the various industry verticals. So some of the traditional operators within those verticals, and obviously, you can use retail as an example on the disruption that Amazon brought, many of those retailers are now in an arms race, if you will, to upgrade their own digital capabilities and their interfaces with their customers, mobile ordering platforms and so – and this is going to go on for quite a while. So that’s just one industry, for example, where you see another disruptor that has triggered a response from some of the more traditional operating entities within the vertical. And this is going to continue for quite some time.

Yes. It’s this whole creating a frictionless experience is really what it boils down to. When you look at some of those disruptors, whether it be the Uber’s of the world, the Lyfts of the world, what did they really do? They took something that was traditional, brought it online and created a frictionless experience and a much more efficient overall operating environment. And this is what every business in the land is after.

Got it. I appreciate the color. Thank you.

Sure.

Thank you. [Operator Instructions] Our next question comes from Mark Marcon with Baird. You may proceed with your question.

Hey, good afternoon and congratulations on the strong resiliency. Wondering if you can talk a little bit on the IT side, obviously, you referenced there are certain verticals where clients are being impacted. But obviously, others are continuing to accelerate what their work was. Can you give us a sense for the percentage of clients that were expanding their usage versus those that were pulling back a little bit? And how broad is the client base that you are seeing with the expansion right now on the IT side?

Yes. So I would – I will kind of answer that in two parts. One, I will give you a sense for our customer base, and then I will give you a sense for what we are seeing across broader industries. So Mark, the way that I would say is, 7 of our top 10 industries that where we do business, they either grew or remained stable sequentially or on a year-over-year basis. And I would say year-over-year because some of them had very difficult comps. So there’s great momentum in there. The three industries that were more challenged were those that were more directly impacted by the current crisis, retail, healthcare, transportation and leisure. I mean outside of these industries, we have really seen stability and in the normal course of business, outside of – you always have unique client dynamics. But within those industries, all those other industries seem very stable and a subset of that, when I look at our top 25 clients that we do business with on the Tech front, I mean 17 out of 25 of those clients grew on a sequential basis. So that’s from Q1 to Q2 and realized Q1 did not have a full COVID impact. So that just gives you some feel for the overall market, hopefully.

It does. That’s very helpful. And those 17 of the 25, how much do they comprise of the overall IT Flex?

Yes. I mean, our top 25 customers here for a number of years now typically make up almost half of our overall tech revenue footprint. I mean, it will bounce around. Sometimes it will be – it might be mid-40% or it might bounce a little bit closer to 50%, but it’s all pretty much been in that ZIP code for quite some time now.

Great. And then it sounds like, you gave really good color with regards to the bill rates on the Tech Flex side in terms of its – a greater level of concentration on some of the higher skill set. On a skill set for skill set basis, apples-for-apples, what sort of bill rate increase did you end up seeing if you were just looking at comparable skill sets, roughly speaking?

Yes. I don’t know that it’s very easy to parse that, Mark. I would say generally speaking, there’s a scarcity of talent. There certainly is an acknowledgment of that in the marketplace. And so for skill set to skill set, certainly, the bias is increasing bill rates.

That’s right.

Yes. I would say it is increasing. It is increasing bill rates, but the shift in our portfolio because of the lower skills not being as remote capable so when that business comes on, I mean you artificially involve numbers. It takes up those bill rates. And so it’s really the combination of those two things.

Okay. And then with regards to managed solutions, can you talk a little bit about some of the types of projects that you are doing there? And what percentage of your mighty Flex its currently comprising and what sort of growth you are experiencing there?

Well, we haven’t really broke out the percentage of revenue because it’s a nominal percent of our revenue at this point in time. But I would say our teams are continuing to make really nice strides in building out our capabilities, the overall operating model. I mean our efforts on this from a revenue growth standpoint they are outpacing the traditional tech offering. I think as you hear from others as well, because of just some of the market dynamics that are going on. I mean we have actually redirected a number of our best people that are now fully dedicated to pursue this type of business to leverage because what we are really doing is, we are leveraging existing relationships, and those clients are pulling us upstream. So our objective, and I think Dave put it out there in one of our earnings calls in the past was really within probably the next 4 or so years for this to comprise 20% plus of our overall Tech Flex footprint. So, the types of work that we are doing within, this is very similar to the other types of work that we are involved with the customer. It still ends in and around a lot of digitization. It’s the same type of work, it’s just that we are playing a more significant role and/or having greater responsibility for what those engagements are versus just putting in staff odd people on those same types of engagements. So it is not like it is a different business that we are in. It’s just the nature of how we are performing the work within those clients.

Mark, this is Dave. We will break out that business when it gets to a significant level. And I am going to tell Joe on this call to hurry you up and get to that 20%-plus level. So you have heard it here first, but we are making great progress there. And by the way, those business projects that we’re taking on are also at higher bill rates, which is another reason the bill rates are going up.

Great. And then can you talk a little bit about, obviously, COVID and the impact towards digitization is having an impact. But can you also talk about some of the other factors that are impacting IT work in the current environment? So, obviously, with the administration putting pressure with regards to offshore work and then some of the technical difficulties that have occurred and then also some of the changes in terms of potential legislation around H1Bs and restrictions, can you talk about those impacts and how we should think about them going forward?

Yes. I would say in terms of the impacts to the stem work or the Tech specifically, I mean, you have to look at with the overall makeup of the Tech workforce is, there is a very high percentage of four nationals, which is why you see the big tech companies, whenever this comes about, they come to the forefront because you start impacting that world, and you’re going to bring tech to a screeching halt and what’s been driving the market over the better part of the last several years, I mean it’s the tech companies. So in terms of what we’ve seen from the administration because we track those things very closely in terms of the different visa situations because it is unique based upon type of visa, we see very little risk in our business at this point in time based upon what’s out there. I mean I’d say that would apply to many others out there. Because again, remember, a lot of this legislation is going after those global providers that are basically trying to offshore or bring people onshore to replace droves of people from an outsourcing standpoint, not necessarily the people that are inside these IT organizations working on very specific projects. So I mean from – that’s really what’s happening from that standpoint. And in terms of just the overall tech, we’ve just seen tremendous stability across our entire customer base.

Great. And I mean, it should create some opportunities as well, no?

Well, are you talking about the opportunities because of the – what was going on with India and the inability for India to potentially service things from an offshore standpoint from a work-from-home because...

Precisely.

Yes. That was out there when that first happened. I’m sure when you read the reports of all the global outsourcers that have reported that’s not being reflected in their reporting to date and we – while on the front end, we had certain clients that were starting to raise potential issue. I don’t think they saw the same ramification. I would say, actually, more of what we’ve heard is – and I don’t want to call out any one specific, but more is in and around the data breach that took place, which I would say is a much more isolated situation versus this massive, what used to be offshore is now coming back onshore. I mean, there’s going to be mission-critical situations that may have been identified, but I don’t think that’s materialized to the extent of what it was believed that it might be.

Great. And then can you just talk a little bit about the efficiency improvements that you’ve had? You’ve got the talent management system that’s going to be – it’s still in the process of being rolled out. What will that do? Also, what percentage of capacity are you currently running at with the existing number of recruiters and account managers that you currently have? And lastly, David, you talked about potentially changing your office footprint. What are the implications from a margin perspective longer-term as you re-imagine what work-from-home could be like relative to kind of the more standard traditional way that we’ve worked?

I will let Joe answer the first part, and then I’ll comment on the end. Go ahead, Joe.

Yes. So from a technology investment standpoint, as I mentioned in my comments, our first step was to decide who did we want to partner with long term. And that decision was made with Microsoft just because of just how integrated and seamless things could be with them, leveraging dynamics. So we started down that journey. We went after our CRM platform first. And now, we’re on the back end of going after TRM, which will provide us a fully integrated seamless platform. Because you have to remember, when you’re inside one of these platforms, one day somebody is a client, the next day they are a candidate, but it still is a person and that’s the value that we get out of the dynamics platform. So what we have really been focused on, because I would say CRM, TRM within dynamics is just one element of what we have been after from a technology and innovation. As we’ve mentioned in the past, we entered into a strategic relationship with another party from a joint venture standpoint, where we’re applying some very innovative technology. In fact, that technology is, what was a key driver in our ability to staff over 5,000 to 6,000 roles in less than a 30-day period when we picked up the COVID business. So what we’re really honed in on is on the recruitment side is everything from identification to match and where can we apply innovative technologies to remove people out of that equation, so the technology can do the things, technology can do better, and then our people can do only those things that people can do so that they can be much more proficient in interacting with people because the relationship is still a huge piece. So that’s what I would say from…

Yes. Well, you can editorialize when I’m done. I want to respect, we have a few other folks in the queue for questions. But the one thing I will say related to the real estate is we don’t have the answer yet. We just know that it’s going to be different. And we are going to test different models. But I think for just about everybody, work-from-home certainly opened up a lot of different ideas and greater flexibility. There’s still a desire for people to have fellowship and to gather and to interact. But it’s no longer necessary to have large-scale footprint of real estate in what was a traditional office setup. We can’t say today what the future is going to be. We just know that it’s going to be different. And we just know that the likelihood is that the real estate footprint is likely going to be smaller with a much better flexibility. Joe, do you want to add to that?

No. I think you really – you captured everything there, Dave. I mean the reality is that the office of yesterday is not going to be replicated. High probability will not be replicated in the future. If you remotely believe that social distancing is going to be one of those remnants that remain to any extent after this because I just don’t see organizations doubling their real estate footprint to accommodate social distancing. And most companies that you talk to, that’s where most people are. They can only accommodate about 50% of their historic population in their legacy real estate footprint what tires to step back and really look at, how do you really repurpose, how you’re using office space to take advantage, by the way, of all of these innovations that are coming about. I mean, if you read any of the acceleration and adoption of these video platforms, whether it be Zoom or Teams, those are going to be remnants that are also left behind, and everybody is going to be re-challenging, where did I get efficiencies through this, how do I integrate that into my standard operating model, what does that translate to my real estate footprint.

And people have changed the way that they’re working. I mean you’ve got families at home now, two income families, teaching their children at home. And so that’s going to change as well depending on what happens with the school openings and so forth. So we do believe that there is much greater operating leverage now for us from a real estate footprint and I think the technology, as Joe said, it’s going to continue to enable people do the fun part of the job and not have to do some of the more mundane aspects of it.

Great. Thank you.

Thank you.

Thank you. Our next question comes from Tobey Sommer with Truist. You may proceed with your question.

Thanks. Could you describe some of the occupations that you said are sort of high end now and in greater demand and driving the bill rate increases as well as some of the occupations and categories that are seeing decline?

Yes. I would say the decline would be the logical ones that you would think of, which would be more like the support-oriented roles, where somebody really had to be physically on site to help do certain things, so what – really what we call the lower end of the tech spectrum, which is heavily involved in the operations or the really the day-to-day things where they have to physically be there. That’s where we saw some of our fall off. Obviously, when you get into whether it’s the help desk and those type support things, those are more capable of being moved to remote. But in terms of the skill set, the acceleration, I’d really say, Tobey, what it’s really been is it’s not anything new that we’re doing. We’re just doing a little bit more in some of the higher-end skill areas. A lot of the people that are in the UI/UX area with heavy understanding of mobility that can come in and really from an architect standpoint, so really help evolve things versus just laying code or something of that nature. And so I’d say that’s just one area where we’ve seen some of the shift mix take place. And then you also – this has driven a lot of need for your project managers, your program managers, which, again, are areas where we’ve always played, but as a percentage of our overall makeup, it’s becoming a little bit larger percentage. So that’s what’s driving up some of the bill rates.

With respect to the managed services growth you said accelerating faster, could you quantify that? Do you think that you’re going to be able to grow your business there organically sufficient to meet your longer-term goals?

Yes. And I think I said this in the past is we’re totally confident that we can obtain our goals organically. However, that doesn’t mean that we’re not going to look for the right opportunity that could accelerate some of our move into a given skill area. So we have – we were and we still continue to look at strategic opportunities on that front. We just haven’t found the right fit. So the good news is that we don’t have to do anything from an acquisition standpoint to hit the targets that we’ve laid out there. However, if the right opportunity comes about, it’s a good cultural fit, they’re in the right skill areas that are going to allow us to accelerate within an area that we’ve already designated that we see long-term market opportunities, then we’re going to pursue those.

And could you quantify what sort of growth rate the faster acceleration was in the business here recently?

It’s significantly more than our core Tech business has grown. We haven’t broke that – we haven’t broke that segment out nor have we reported growth rates because to talk to about a growth rate without understanding what the revenue base is, is kind of meaningless.

Okay. Curious, in the F&A side, you’ve certainly shielded what otherwise would be kind of a downside in the core Flex business. Do you think you’ve got something structural in place that can shield a downturn? Or did you just kind of land a great contract? How should we think about that over the course of time?

Yes, I think I mentioned it earlier, and it was in my opening comments as well. The opportunities that present themselves were from past relationships on business that was won by partners that we had worked with in various other disaster recovery relief programs. So it was the right place, right time. Part of that was the strategic relationship and our ability to deliver at scale. So obviously, they wanted to trust a partner that they knew that if they were to push this amount of work that it was going to get delivered upon in very compressed time lines just because of the pace that was required because of the nature of the crisis to get people on board. But in terms of structurally, as we look forward, and I had mentioned this in one of the questions that was asked earlier, we’re really looking at our FA footprint to try and create as much synergies with our Tech footprint as possible, because there’s this whole gray zone that sits between the finance organization and the tech organization that’s blending. And those are the areas that we see the long-term prospects for us, as Kforce, just because of the nature of our Tech footprint, what we’re doing in Tech and then how that can transcend into other areas within an organization outside of the IT organization into the CFO organization, into the CMO organization, because, again, everybody is looking at how do I get after this data and how do I leverage this data, and there’s a lot of finance expertise that’s required there as well as a lot of technology expertise to make those things come together.

Thanks If I can just sneak one last one in. With respect to your capital deployment, I’m curious why you’re paying down the debt given how resilient the top line has been and not just buying back stock?

Yes. I think, Tobey, one, I think, important, we’re continuing to make investments as well to grow the business, right? So we’ve got the opportunity to do that, whether that be technology or otherwise. And I think for us, where we are today, we think caution in being – discretion is a better part of our here in these uncertain times. It’s as simple as that.

Yes. I would just complement or comment on that as well. Tobey, if you look at what’s happened, I mean, with the recent outbreak accelerating again, there’s still some question as to whether there’s going to be a second derivative and a fall outbreak. So we’re going to play a conservative at this point, unless something is so compelling that we need to act on it because it’s still going to give us all the power that we would need to do something. So as we’ll watch over these next 2 quarters or so to get a sense for where this is going, we’ll be able to give greater clarity.

Thank you.

Thank you.

Thank you. I’m not showing any further questions at this time. I would now like to turn the call back over to David Dunkel for any further remarks.

Well, thank you. It’s been an amazing time. And I just want to take this opportunity again to congratulate our team and thank our team. You guys were spectacular. And for our customers and our consultants, amazing resiliency the word unprecedented doesn’t really do justice to what we just went through in this quarter. Yet at the same time, as we look ahead to Q3, we are really excited about all the good things that are happening. And the resiliency of Kforce and just the talent in our team are just such an encouragement to all of us. So thank you. And so for the rest of you all on the investment side, thank you for your interest and support for Kforce and certainly unprecedented times and thank you for your support and standing with us. And we’re excited actually about what lies ahead, and we will be diligent stewards of Kforce in the future. Thank you very much.

Thank you. Ladies and gentlemen, this concludes today’s conference call. Thank you for participating. You may now disconnect.