Good morning, and thank you for joining the Tetra Tech Earnings Call. By now, you should have received a copy of the press release. If you have not, please contact the company's corporate office at (626 ) 351-4664. As a reminder, Tetra Tech is also simulcasting this presentation with slides in the Investors section of its website @ www. tetratech.com. This call is being recorded at the request of Tetra Tech and this broadcast is the copyright property of Tetra Tech. Any rebroadcast of this information in whole or part without the prior written permission of Tetra Tech is prohibited. With us today from management are Dan Batrack, Chairman and Chief Executive Officer, and Steve Burdick, Chief Financial Officer. They will provide a brief overview of the results and we'll open up the call for questions. I'd like to direct your attention to the Safe Harbor statement in today's presentation. Today's discussion contains forward-looking statements about future growth and financial expectations. Actual results may differ significantly from those projected in today's forward-looking statements due to various risks and uncertainties, including the risks described in Tetra Tech periodic reports filed with the SEC. Except as required by law, Tetra Tech takes no obligation to update its forward-looking statements. In addition, since management will be presenting some non-GAAP financial measures as references. The appropriate GAAP financial reconciliation are posted in the Investors section of Tetra Tech website. At this time, I'd like to inform you that all participants are in a listen-only mode. At the request of the company, we will open up the conference for questions-and-answers after the presentation. With that, I would like to turn the call over to Dan Batrack. Please go ahead, Mr. Batrack.

Great. Thank you very much, Laura and good morning. And welcome to our fiscal year '22 first quarter's earnings conference call. We had an excellent first quarter and an exceptionally strong start to our 2022 fiscal year. Our performance resulted in record first quarter revenue operating income, and earnings per share, and 120 basis point expansion in our collective operating margin. This extraordinary performance is a direct result of our long-term strategy to grow our high-end services, which is defined by our Leading with Science approach applied to our water and environmental markets. Given the strength of our performance and our outlook, we're increasing our guidance for both net revenue and earnings per share for fiscal year '22. We will begin today with an overview of our performance and customers, followed by Steve Burdick, our Chief Financial Officer who will provide a more detailed review of our financials and capital allocation. After Steve, I'll then address our customer outlook and our updated earnings guidance for fiscal year 2022. In the quarter, we hit all-time first quarter highs for revenue, operating income, and earnings per share. Our revenue increased by 12% year-over-year from $605 million to a new all-time high for our first quarter of $679 million. Our operating income increased at more than double the rate of our revenue growth. And operating income was up 25% from last year, reaching a record $83 million for the quarter. And finally, we delivered a $1.19 and adjusted earnings per share. The highest quarterly earnings per share of any quarter in the company's history. And a 14 cents from our previous high record earnings per share of any quarter. I will note down on a GAAP basis, our quarterly earnings per share was even higher at a $1.25 per share, up 30% year-over-year,…

Thank you, Dan. So I'd like to now review the GAAP financial results for the first quarter of 2022. So overall, as Dan noted earlier, we had record Q1 results for revenue and earnings, which very strong top-line growth, with first-quarter revenue of $859 million. The net revenue amounted to $679 million, which was at the upper end of our guidance range of $630 million to $680 million. Our revenue and net revenue were both up 12% over last year with strong growth from state, local, international, and commercial markets. Our operating and financial results were the highest of any first quarter. Our operating profit and earnings per share for the first quarter increased over last year also. GAAP, EPS came in at $1.25 in the first quarter, which is an increase of 30% over last year. The higher EPS was due to the increase in reported operating income, which came in at $87 million this quarter, which is up 32% over last year. Our record operating income for the first quarter was largely driven by 27% growth in CIG segment operating income, and 13% growth in GSG segment operating income. The resulting CIG margin of 12.5% is up by 100 basis points over last year. And the GSG margin of 14.7% is up 70 basis points over the last year. We also had lower corporate costs which contributed to the better margins. And all told on a consolidated basis, this resulted in an EBITDA margin of 13.7%, which is a 170 basis points over the first quarter of last year, of 12%. Now, our GAAP EPS came in better than our adjusted earnings per share of a $1.19 and better than the top end of our guidance range of $0.98 to $1.3. The difference between our GAAP EPS with…

Thank you, Steven. Next, we're covering the details on our quarterly performance, not just on the work from our operations, but also where we sit on the balance sheet as you presented it quite clearly. We have, here at Tetra Tech, three key market drivers that continue to shape our client spending, long-term programs, and investments in the future. The first is the U.S government has identified climate change, water, and environmental protection as critical priorities. First and foremost, these priority programs are implemented through the federal budget associated with spending by key agencies that we work for, such as the U.S. Army Corps of Engineers, the U.S. Environmental Protection Agency, and the U.S. Agency for International Development. The second area that is a key driver for us is the U.S. government is now also working with state and local governments to implement the Infrastructure Investment and Jobs Act, or IIJA, to supplement additional funding's for the government budgets, especially at the state and local levels are creating long-term increases in spending for water, environment and resilient infrastructure services that we provide in the global market leadership. The White House's guide book to IIJA was just released Monday, just three days ago, and outlined an estimated $80 billion dollars that's been identified for distribution to states as just the first step in releasing the funding associated with IIJA. The third market driver is in our international markets. Here we are seeing a new focus on climate change programs and an increase in associated budgets including de -carbonizing buildings, biodiversity and land management, and protecting the oceans. This focus is resulting in an increased demand for our high-end consulting and engineering services in the United Kingdom, in Australia, and all throughout Canada. I'd now like to highlight how these same priorities…

The question-and-answer session will begin now. Please be aware that there will be a 30-second pause in our webcast to allow for buffering. At this time, audio participants are invited to submit their questions. Please remember to mute the audio function on your computer before you speak. If you're using a speakerphone, please pick up the handset before pressing any numbers. [Operator Instructions]. Our first question comes from the line of Noelle Dilts with Stifel. You may proceed with your question.

Hi, guys. Good morning and thanks for taking my questions.

Absolutely.

Sure. So first I was hoping that you could expand a little bit more on what you're seeing and expecting as it relates to margins. GSG margins were -- really margins in both segments were strong in the quarter GSG particularly strong. Could you speak to how you're thinking about the strength in the quarter, how much of that is sort of sustainable versus how much maybe benefited a bit from store Marc. And then if you could speak to your expectations for margins for each segment for the year, if anything has changed relative to the last conference call and also longer term. Thanks.

Absolutely. Let's we start with the extraordinary contributions during the first quarter from unusual events. Is that we did have a contribution from disaster activities that did contribute to margin expansion in the first quarter, and we typically associate that with increase in utilization. So the GSG margins, which were 14.7 during the quarter, a year ago, we were 14 even and so we were -- if you take a direct year-on-year were up 0.7. About half of the increase in the GSG margins we've associated with increase in utilization such as being driven by the disaster work and the other half is actually mix shift by adding more data analytics to high-end federal IT activities. So if you take a look at just the GSG margins in the quarter, about half of the 70 basis points was associated with increased utilization, partially driven by the disasters. If you take a look at -- so, it would be about 35 basis points since government workers GSG segment is about half. If you actually imputed to the entire company, it'd be about half of 35 basis points, so about 17 basis points if you want to be precise. So we did contribute but it's roughly on that order. So I would call it a contributor but it wasn't the driver. With respect to our CIG margins, they were just increase in performance based on the mix shift that we've been employing. We've continued to emphasize higher end consulting and front-end engineering work, which actually does carry margins -- higher margins. And so I'd say it's more structurally representative of where we're going. With respect to what are the annual or annualized margin rates for the two groups, I would say that we've increased this year for CIG on an annual basis…

That's it. Thank you. Very helpful. And then just for my -- secondly, you definitely stepped up the share repurchase in the quarter, shares have been under pressure and that really part of the year. Could you speak to how you're thinking about priorities for capital allocation and the relative attractiveness of repurchases versus acquisitions at this point? Thanks.

Well, that's a good question. I think Steve covered it. I'll basically just do a quick recap on the priority. Number 1 is of course we want to fund internal organic growth. That's embedded in our operations already with respect to CapEx, which is quite modest. We're down to about 1/2% to 1%. So we're incredibly asset-light. So the organic growth that we are realizing the company is only requiring a very, very small amount of our cash generator created from operations. Second, we're committed to the dividends. We've now, in every year that we've had the dividend, as Steve had indicated, we're 31 consecutive quarters. So do that math. It's about eight years. Every one of those years we've increased the dividend double-digits. And we're committed to that, and to continuing that process. So that's the next priority for besides internal growth, that's the next priority for our use of capital. On the next does actually use for acquisitions and making Tetra Tech more competitive and furthering our strategic plan in for the marketplace and to differentiating ourselves and the water environment, sustainable infrastructure, renewable energy markets. So we are very focused on bringing the best and brightest firms to come drilling new VAR partners here at Tetra Tech, and that's through acquisitions. Now, acquisitions can be less consistent with respect to the timing and the size and therefore, we've employed a buyback. And in fact, this was the second greatest quarter we've had in the amount of buyback we've had and it was not triggered even though there's been some dislocation in multiples and pricing, that wasn't unique to Tetra Tech. Of course, there was a pullback across entire market sectors. But we put in a -- essentially an even purchase throughout the quarter, some weeks it's higher,…

Thank you. Very helpful.

Our next question comes from the line of Sean Eastman with KeyBanc Capital Markets. You may proceed with your question.

Hi, Dan and team. I'd love to dig a little deeper into the growth optionality in commercial. I think the high performance building side is pretty well-defined, but if you could round out what other opportunities are firming in Commercial and maybe tie that in with this nice margin accretive mix shift we're already seeing in the Commercial book of business, that would be super helpful.

Yes. That's a really good question. It's one we've really not spent a lot of time talking about in our investor calls quarterly here for some time. But I know over the past few quarters and certainly through the early part of the pandemic, we saw Commercial impacted negatively. And we've actually indicated that we thought that the first quarter of this year would be the second step and inflection to go from being flat or even down to actually growing. We actually see it in there continue. And what's -- what we find to be quite encouraging, is not only do we see the Commercial and that's not just in the United States, it's really for our very large, multinational global clients, including heavily on the industrial side. There's more dollars and more commitments in funding and contracts being committed by these clients that we both have here at Tetra Tech now which has many of the Fortune 100 but we're also looking to bring other firms onto Tetra Tech. So if you asked, what's one of our priority areas? You've certainly heard me in the past, US Federal data analytics, IT differentiation with respect to using advanced data analytics to solve some of our clients’ problems, water firms both in the UK and Australia and we're now going to add here tactically, looking for firms to join us that have leadership positions with global commercial clients. And these are solving their problems regarding sustainability. Big issue has been water. We've always talked about this both for water, for supply, for their operations, for their containment in treatment before any type of discharge. And of course, their long-term sustainability and resiliency programs. What we do like and I have said this [Indiscernible] recall, I'm sure for the past many years that the CIG, our Commercial International, has the ability to have margins much higher than our Government Services Group. And that's going to be driven by work that we do at the C-suite for our large global commercial clients where we're bringing exceptional value. And so while it does carry higher margins for us, it actually carries enormous savings for our clients by selecting the right alternatives, the right compliance activities, and the right decisions to be made in their future for anticipating new regulations and compliance requirements on the environmental and water side. So we think not only carries better margins for us, which will help accelerate CIGs closing. And in fact, I would expect beating of GSG margins. But I'll tell you the value we're bringing to our clients through these services are really extraordinary. And I believe not only best-in-class, in many instances really not offered by anyone else.

Interesting stuff. And to the extent, just hypothetically, the business cycle rolls over, how much sensitivity is there in this growth prospect pipeline for the commercial business?

That's a really good question. I know that we've had in the past. If we went back 10 years ago where we were actually doing much more detailed designs and construction management. We saw the volatility or the cyclicality of commodities drive that business up and down for us. By having moved weight to the front-end and actually working on the front-end planning, the strategies and the upfront prioritization of programs. We find ourselves much, much less exposed to cyclicality that you see with commodities that is inherent and a lot of these large multinational programs, and especially when you're talking about fossil energy companies, which is really oil and gas or mining. Really, we're moving away from that, and in case of energy, it's not just oil and gas, but its transformation to add other energy sources, such as renewable energy or even de -carbonizing some of the standard oil and gas or fossil fuel production that exist today. So we would find the work that we do to be much more consistent. I will say we're prioritizing quality over quantity. So by not doing the implementation, the projects are smaller that are less volatile, and they are higher margin, and they are highly differentiated. Because when you become the long-term consultant, and partner with the strategy, and implementation on where the companies are going, we see that to be much -- see lot much less fluctuation through these business cycles that would've been seen if you're actually implementing these solutions.

Okay, interesting. One last quick one from me. Dan, how would you characterize the timing risk around the IIJA tailwind for Tetra Tech? Are you increasingly convicted that we're going to see meaningful momentum there starting in fiscal '23? How would you characterize that?

I wouldn't say that we're increasingly focused. We're very methodic about this. We're very analytic about this. I think my comments regarding the first 80 billion, which is just the first installment that's been earmarked for the programs and in fact the guide book that's come out. So that's further, I would say, does that make us more encouraged? No. It's just additional support to what we've seen. So I do think it's important to note, these are my comments, that we've not included any material contribution from IIJA into our fiscal 2022. So we think it will come out in the fall. We're already seeing contract vehicles be put in place. We think the first beneficiaries of the funding are going to come out to current contract holders. And here at Tetra Tech with over $20 billion in existing contract capacity that we have, I think we're there. So I've heard anecdotally impact to contracting officers being impacted and not being able to come to work because of the Omicron or something else. We don't need new contracts; we have contract vehicles. So actually the technical staff and the people at the front line can provide funding through the vehicles we have now. I would say we continue to be optimistic regarding the timing of IIJA and to reiterate it and then just to take your question actually one step further, some have asked, well, what about the build back better? Has there been some disappointment or discouragements that it hasn't passed? In fact, here at Tetra Tech, we think that a very methodic or a careful furthering of that on a timely basis. And in fact, as components, there has been some discussion of breaking it up into pieces actually may be better for us. It will create the governments to have the systems to actually put the new funding through to get to the contractors and in fact allow the best contractors to perform this work, not everything at once but they actually do it in a thoughtful meaningful way that we get the best value for the government. So to [Indiscernible], we continue to be optimistic and I wouldn't say we are more optimistic. We continue to tracking that's coming in just as we expect at this point.

Excellent. Thanks so much for the insights.

Our next question comes from the line of Tate Sullivan with Maxim Group. You may proceed with your question.

Hi. Thank you. Just to start off, can you just give more background on moving the high performance building from GSG to CIG, what does it show in terms of the evolution of that business? I imagine it could be in both based on the end customer, but, yeah.

Yes. So if you went back -- if you went back three years, two years, even a little more than a year ago. The largest revenues were being generated here in the United States and a lot of it was government work. And so if you went back pre -five years ago, it was 100% U.S. as mostly East Coast and it was about 50/50 government and Commercial. So it makes sense to go to government. When we added a West Coast operation about four years ago, was still all United States and that was also about 50/50 our government and commercial. So I would say in the U.S. there could have been a decision. But we're looking to grow government more so that's why we put it in GSG. About three-and-a-half years ago, we actually acquired our first international buildings practice, a high performance buildings practice in Australia, headquartered out of Melbourne with a 1,000 engineers. And that all of that work, was being done and contracted for outside the U.S. So very quickly, the work that we had within the buildings had moved to be international and the U.S. was about half commercial. And of course, with the most recent acquisition back in August or in our fourth-quarter of Hoare Lea, which is all international in the United Kingdom, the overwhelming majority of the revenue became either international, which was -- in the UK it's all international, Australia was all international, and the U.S. is, and probably close to half, commercial. When you're sitting at 70%, 80% of the collective buildings group residing either in commercial or international, it made sense to house it there. We didn't really want to break it up because we're sharing clients, we're steering projects. And I assure you one of the big growth areas that we see in our high performance buildings area is actually with the US Federal Government. And we're growing work right now with the Australia government through their administrative or through their Department of Defense through MOD, Ministry of Defense in the UK. So we do have government work and we have had that overseas, but we're looking to grow that even more here in the U.S. But the reason we moved it was to keep it consolidated, so the group could work cohesively, seamlessly, and bring all of the best that we have in Tetra Tech to clients and not have to go in to the segment and so that's the reason we moved to fully. Now, just

as a point, we didn't move the entire high performance buildings from Government Services to International because 1/2 of it or more than 1/2 of it was already in the International Group for the work that we had in Australia. And of course in the fourth quarter in the UK, so that was the rationale for consolidating into the CIG segment.

Thank you for that context Dan. And then you mentioned emerging contaminants in your prepared remarks and in the annual report, you showed that -- you mentioned $50 million in new programs to investigate and treat emerging contaminants. Was that up from a base of zero the prior year and then you also mentioned a new ion treatment plant. Is this an ion exchange plant? Can you just get -- is this an opportunity right now in just a couple of states? Has it already grown to multiple states? Can you go into a little more background on that opportunity, please?

Sure. We're up to $50 million and we have $50 million worth of orders to investigate our emerging contaminants, and to be specific, as primarily PFAS. And it was not up from zero, so it was up from what I would say coming into 2021. So to look back a year, a number was probably around $20 million, so it's up by about a 150%. So it's growing. Now with respect to ion-exchange, there are a number of different methodologies of treating PFAS. I guess the conventional best demonstrated available technology has been carbon or granular activated carbon, and also ion exchange. Tetra Tech did the design here in California for the largest PFAS municipal treatment facility in the United States and we happen to have used ion exchange. There are other methods that we're working with on innovative technologies that are looking to be -- to disrupt these technologies of either ion exchange or granular activated carbon. And so we did call it out because it's first of its kind in scale for a municipality. We do think it's going to grow. There are several things that are driving it. One is the responsible parties who discharged PFAS, which is really an additive to firefighting foam, partially used by the military, but other firefighting institutions also. Ultimately, this is on track to be regulated as a drinking water contaminant that will have a maximum level that will be treated at every single municipality in the United States. And similarly, they are developing drinking water standards in Australia and the United Kingdom with their well down the road. Similar to the U.S. sort of moving in parallel to developing these. So what is the market opportunity adding a treatment technology to treat PFAS at every single water supply utility in the U, S. And that's ultimately our eye on the prize. And ultimately, the demonstration of putting full-scale treatment in place, we're among the first to do it and certainly the entity to do it at the largest scale in the U.S now, and that's what we're focused on. So it isn't going up to 50 from 0, but it hasn't hit that steep part of the curve in funding, which will be driven by regulatory requirements. And that'll should take it and have a grow by really orders the magnitude.

Thank you Dan.

Thanks Tate.

Our next question comes from the line of Marc Riddick with Sidoti. You may proceed with your question.

Good morning.

Morning, Marc.

So a lot's been covered in the Q&A which is great. I did want to just circle back on a higher level, just you as to maybe what you're seeing out there within the acquisition pipeline today maybe versus a year ago. I guess, last calendar year -- going by calendar year, you guys ended up doing five acquisitions and I wanted to get your thoughts on maybe if you compared what the pipeline looks like now versus a year ago as well as maybe the attractiveness of international versus [Indiscernible]. Thank you.

Thanks for your question Marc. I think our acquisition pipeline actually looks very consistent to what we saw a year ago. So we're looking at it on fiscal years in that calendar, but we did four acquisitions in fiscal year 2021 we did one in our first quarter, so we've got one down. We look that it's relatively similar. We're relatively agnostic whether or not it's International our U.S. because some of our priorities with respect to international, particularly in Australia and the United Kingdom with adding water consultancies is a priority. But we wouldn't put that priority over adding additional federal IT companies here in the U.S., or advanced data analytic companies primarily here in the U.S, or digital water companies here in the U.S. And really the tactics I think will contribute as a company, a very high end commercial environmental companies here in the U.S. So if you'd asked if a water company came up in the UK or Australia versus a data analytics company, or a commercial high-end environmental company here in the U.S., we go international, or will we go U.S. Will we go U.S. environmental over IT? And my responses will do all four. We'll do one water in UK, Australia, and we'll do an environmental the U.S., and we'll do an IT company here in the U.S. So I think was the balance sheet we have that Steve covered, it's not either or for us, it's just one criteria. Will it increase Tetra Tech's competitive position? Bring new clients and differentiate us in the marketplace. Will it think it's better than we are today? And if the answer is yes, we don't have a governor or threshold by which we have to make a selection of one over another. And with respect to what the pipeline looks like, it looks very similar to what we saw last year.

Okay. And I guess I would be remiss if I didn't ask the question, which a lot of folks are concerned about across the board and that's just overall labor availability, spending, recruiting, and the like [Indiscernible] if you give a quick update on what you're seeing and what your expectations are, and maybe also tying that into what the -- given the backlog and the opportunity -- growth opportunities that you see going forward. Thank you.

Yeah, it's a good question. It's probably the most common question I receive and not just myself, but really our entire team is, are we seeing labor shortages? We've not seen labor shortages; we've not had a shortfall of labor to perform any of the work we have here. We have had to spend a lot of consolidation in the environmental water fields. Some of them have been consolidators that have caused disruption and those that have actually gone through this consolidation and so we've actually been a big benefactor of what I would call very high-end, internally, we call them strategic hires, but I would call them thought leaders, so technical leaders in the marketplace. So interestingly enough, we've -- it has actually gone quite well for us. We do track very, very closely our turnover rate. And our turnover rate, voluntary turnover rate is actually down slightly once the pandemic has started from pre -pandemic deliveries. Now, I think some of it's kind of in the noise were down a few tenths of a percent on turnover. We're just sub 10%, and before and we were like 9.8 and we're down to 9.5. So those types of numbers. So I consider it de minimis, but we've not seen turnover in the company of be a particular issue. Increases we are cognizant of salary pressures and inflation in the rest of it, we do pay at market. But I will say that most of our contracts or I guess the great majority are either time and materials where we have annual escalation rates that taken into account or cost plus where it's passed through. So we don't really see that. And I will say one item that we're very focused on here in the company. We believe the productivity…

Much appreciated. Thank you very much.

Great. Thanks a lot [Indiscernible], Marc.

Our next question comes from the line of Michael Dudas with Vertical Research. You may proceed with your question.

Good morning Dan and Steve.

Pretty Michael.

Given you reaching a record backlog and a constant currency basis, how will the order flow be and especially with the federal side? Do you anticipate that during 2022 you can maintain growth in the backlog, a positive book-to-bills? Any issues given maybe some of the funding or some discussions on Washington especially with what's going on on defense and some of the focuses may be turned elsewhere on how to make some of those [Indiscernible]?

Well, our -- I actually was very encouraged with our first quarter of book of business. Our new task orders being awarded to us. It was -- and honestly, it exceeded our expectations a little bit with having one of the biggest revenue -- we're having the biggest first-quarter revenue that we've ever had, and normally puts pressure on the back log in the first quarter. And normally it's a little bit lighter activity for new awards because you've got Thanksgiving and Christmas and New Year’s, and its just generally slowdown, but we saw a really good flow of new orders. So with respect to the first quarter, it was very good. With respect to what we see in the outcome or in the outlook. It is interesting. I do expect defense is not to be a priority, so we have three even buckets or even components of our Federal work. So civilian agencies, things like the FAA, Federal Aviation Administration, U.S. CPA, NASA, NOAA, National Science Foundation of these folks. We've seen most of their budgets up; it is an alignment with the priorities of the administration. So I think that the book of business and the outlook there looks very good. So it's increased in priority. You can see and I don't want to point to Ukraine as they work -- as they work up opportunity for task. But I do want to point out to as administration's priority for its diplomacy and development. Diplomacy and development are the priorities, not defense. So more dollars will go into diplomacy followed by development, which we want to give the U.S. a hand up to those less fortunate, and that is actually good for all of us. And as one of the large USAID contractors, we think that we'll benefit from that as the year goes on, so I feel very good on that front. And defense, we feel that even with defense being -- let's call it flat or not the ultimate priority of where additional funding will go, we think we're going to be a benefactor of this. And how we think that's the case is we think dollars will move from weapons, platforms or other areas that are considered offensive or areas that are very large portions of the budget. And it's going to move towards quality of life, sustainability, cleaning up this environment from legacy operations of defense, creating new buildings that actually reduce the carbon footprint high performance buildings. Many of the things that we do. So we think that defense budget in and of itself may not be increased or be "flush " with additional funds. But we think that the reprioritization of funding within the department of defense for activities that we performed should actually be pretty strong as we've continued to move through this administration and into the future.

That's encouraging Dan and my follow-up is, let me just go back to the capital allocation and M&A pipeline. Is there any target level of capacity, balance sheet capacity that you like profitable for you? And given what you've described sounds like will be more niche, smaller acquisitions, maybe several of them as opposed to one or two ones that they've might be out for the current company less likely is that something we should think about the net royalty as to how capital gets allocated this year and [Indiscernible].

Well, I would like to start with a -- to a very high level, 100-thousand-foot overview on our capital allocation at target levels, which it really would like to get to a range of one to two times. It probably went over to but it was for the right action for the company. I wouldn't feel uncomfortable at all if it was the right strategy and the right move. Now, you would be right to point out, you've said this for I don't know how many years Dan, one to two, and you haven't yet been able to get there. I don't think it's the worst foible that we've had if we've been able to grow the company at double-digit, we've been able to acquire great companies, we've be able to return cash to the shareholders, we've be able to increase our dividends, and we deliver because of the strong cash flow. So that's not what we're targeting, but it's not a bad place to be. I do think in the short-term, at least if you looked at horizon, and I commented earlier on the questions here, that I see the pipeline similar to what we saw last year and the year before, which does lend itself to several, if you want to call it niche firms. I think every firm that's joined us, whether or not it's had 20 people or it's had a 1,000 people are not niche. Now maybe from a financial standpoint as a percentage of the company's revenue can be characterized, but we think that they are incredibly accretive to the company's intellectual status in the marketplace, whether it's a smaller firm like EA or Ebro PHARMAQ. I'll tell you they are unbelievably a valuable in the company. Whether it's a small Canadian company like…

Sounds like the [Indiscernible] department is going to continue to be quite busy. Thank you, Dan.

Great. Thank you very much Michael.

This will conclude the Q&A session. I will now turn the conference back over to Dan Batrack to conclude.

Thank you very much, Laura, and I want to thank every one of you for attending the call I know you all have busy schedules, and take the timeout, and to participate, and ask these questions, and to follow Tetra Tech is really very much appreciated. I feel really good and our entire company feels very good about the start to the year with a good first quarter. But of course, we do know what we did in the first quarter as what we did before, and we're focused on doing as well or better as we move into the future. And I really look forward to giving you an update here on our next quarterly call on how our second quarter has performed, and providing you more updates on both our outlook for the rest of the year, and how things like the IIJA and other programs are progressing. And as we see them moving forward into the rest of 2022 and beyond. So with that, I hope you have a great rest of the week and stay safe. Thank you.

Ladies and gentlemen, this concludes our conference for today. Thank you all for your participation and have a great rest of your day. All parties may now disconnect.