Thanks for coming. Really pleased. We have Mike Simonds of Unum here. I think that you are in your 25th year at Unum.
That's about right.
Mike is the CEO of Unum US, which covers both the Unum brand and the Colonial brand business here in the U.S. I would be happy if the audience want to participate and ask questions, but you don't have to. I have questions prepared. We have no prepared remarks. Can we talk a little about Long-Term Disability sales versus short-term disability sales? Look, I may not be the most seasoned of the life insurance analysts, but I'm surprised the two don't grow and shrink in lockstep.
Given Unum's sales culture, right now, I think that one was growing around 8%, one's growing around 3%. I can't remember if those numbers are exactly right.
Close.
why are they not in parity, and what's happening in those two markets that might be differently from a sales perspective?
Sure. first, thanks for having me. It's good to be here. It's interesting, and I think, granted, it's the world of insurance, but it's actually a pretty exciting time to be in the employee benefits business, so looking forward to that. Also, to clarify, I do have a peer that runs the Colonial Life business. We do most of our strategy work together.
Okay.
I'm happy to talk about that, the Colonial Life business, which is a terrific business. You're right. Under the group disability segment, we have seen faster growth of the short-term disability line than Long-Term. I think there's two reasons for that. One has been the short-term disability tends to be a higher demand employee benefit when offered as voluntary coverage. You think about it, as consumers, we're often drawn to coverages that we can see ourselves using with higher frequency, and so they tend to be those high frequency, low severity type benefits. In the case of short-term disability, we've seen growth in the voluntary and what we would call employee contributory business, and that's outpaced the growth in Long-Term Disability. I think the second thing for us is increasingly, particularly for employers of some size, we're packaging short-term disability with leave management services.
We've seen pretty explosive growth in the number of employers that are outsourcing the management of leaves. Think of everything from protected leaves under the FMLA federal statutes through a really rapidly growing set of state paid leave laws we've seen here in New York State, we've seen in Washington, and across more than 12 states, there's legislation there. As an employer, if you're an employer of size, you've got employees in all these different states, and there's this patchwork of laws that you need to comply with. Then you throw on top, many companies in this tight labor market are adding their own leaves, so adding to paternity leaves, adding elder care benefits, military leaves. That becomes a really complex administrative undertaking. We've really grown that as a service business and always do it in conjunction with short-term disability.
I think that's helped grow that business overall. If you think about disability in total in the industry growing more in the 3% range, that's more akin to what we've seen in LTD. We've grown that short-term faster.
In terms, I guess then, of the point-of-sale possibility, if I go to whatever vehicle, whether it be an online vehicle or a paper registration vehicle, generally speaking, the opportunity to sell a long-term or short-term disability product at a given employer is the same. It's at the employer themselves, where the election is coming to buy the short-term disability and maybe not buy the long-term product.
I think it's a little bit of that, and more so when an employer's designing the program. They've got limited dollars. They tend to put it into the long-term disability because they see at the macro level the importance of the coverage, and they know their employees will take up and participate in the short-term plan design. It's both at the employer and at the consumer level that we see it.
Okay. That makes sense. I don't think it's just Unum, but a number of your competitors, the results have been very good. We see very good results in workers' compensation, and I'm always wondering the extent to which these two things are tied in parity, how sustainable it is. We're not seeing anything on the workers' comp market to indicate that these trends are going to fade. I guess not so much life, but more staying on disability here.
If we have a three-year view, you've got to be looking out to the future on how you price. Is there anything that's going to get in the way of these recent results? We can talk about in terms of, I guess, unemployment rates. I hear there's people on long-term disability who are coming off multi-years of the office, that employers are making accommodations to bring people back to work.
Is this the peak margin, or is it going to continue?
Yeah. Good question. Start with where you started. It's a very good business, and that's been true for an extended period of time at Unum. We priced and have achieved mid to high teens returns on invested capital. That's a great place to be. We have seen favorable claim experience. We've also managed expenses slowly over time to more favorable levels that have contributed to the margin. We don't see anything that suggests there's going to be a material change in disability risk that's going to represent a swing positively or negatively from an exposure. Point of view, but a couple things that I'd point to. One is just the nature of the business. In this group insurance market, you've got the ability to look at experience and reprice on an annual, and in some cases, with a rate guarantee on a two-year basis.
Should something emerge, you've got the ability to address it in relatively short order when you think about that in comparison to other parts of the life sector. That's something that actually you got to build a competency over time. See, some of the more established disability players have hardwired that pricing renewal process in place. They've got a field force that's designed around quality and maintaining those margins over time, and that's something that you've got to build as a competence. You're right, that's been reflected in some of the returns. I'd say as you look out over the time period, there are a couple of macro, I would say, tailwinds to disability insurance, and you may be seeing a little bit that on the comp side as well.
In general, as the boomers have come through and into retirement, millennials are now the biggest part of the workforce. Average age ends up being a pretty important factor when you think about Long-Term Disability incidents. The other thing that people don't talk as much about, but it's a really interesting and strong correlation, is between education levels of the workforce. As the average level of education achieved continues to increase over time, that is also a very positive outcome from a disability, both incidence and recovery point of view. Do I think there's anything dramatic? I don't have a crystal ball to be able to tell you over the next quarter or year, but I'd say there's a couple of tailwinds to the business that make it attractive.
Can you just dig in a little-
Yeah
deeper on that? There's so many. There's incidents, there's strictly severity-
Yeah
there's Social Security offsets. Can you rank order what's been the most important to the higher level of return?
I'd say for us, it's been hand-in-hand, both incidents, which is new claims coming in, has been generally positive. Recoveries, for us, you actually mentioned it in your question, recovery experience, I'm thinking back over the last four or five years, recovery of what we would call the tail or longer duration, folks that have been out of work for more than a year, 18 or 24 months, some of the recoveries at that end of the curve has actually been favorable for us.
Social Security offsets in this-
Yeah. Social Security offsets experience has been pretty consistent for us. That's a pretty rigorous process, and we're typically seeing things past the hearing level and things have been within expectation for an extended period. I wouldn't rank order that as high. Your other question was around discount rates, dealing with the low interest rate environment, that's been a headwind for this business, geez, for eight or nine years now. For Unum, for our case in particular, that's been a very deliberate move where you've seen our loss ratio and group disability has just slowly come down over time as we've raised our rates to account for the lower investment yields that we're getting. Our portfolio yield and our new money yield over the next two, three years are coming closer together.
I would see that as less of a headwind to earnings growth for us.
To what extent is the pricing reactive? I've been a little surprised, and I realize with generally a three-year policy life, but the tax benefit has not pushed down on pricing as much as I thought it would. To what extent are the trends in disabilities causing renegotiations at materially different prices on expiring contracts?
Good question. It's an opportunity to take one step back and say, at Unum, we've been generating those mid high teens ROEs, and because our approach tends to be one that's based on value delivered to the client, I think we typically, when we look at industry benchmarking, perform a bit better than the industry on margin. If you took the industry as a whole, think in terms of 5%-7% after-tax margins. To your specific question, if I thought about, a 20% reduction in the tax rate. Well, 5%-7% on premium is your profit dollar, a 20% reduction is probably a point in terms of premium. If I pass the entire tax breakthrough, I'd be in effect lowering my premiums by 1%. 1% in our business is an immaterial pricing change.
To have a client move a program to a competing carrier, you'd need to be more in the 5%-10% delta in terms of price. I think that's just part of the practical reality of the business is people have sort of seen it as an opportunity industry to get closer to their target margins. I would agree, it's a pretty rational market right now.
In terms of the competitiveness, obviously there were a couple larger transactions. There was Liberty and Lincoln
Yeah
The Hartford and Aetna.
Yeah.
Is this industry likely to see continued consolidation? Do you think that those ambitions have cooled a little bit? What's the right number of players?
I mean, obviously, there's different size markets.
Right
The jumbo versus the smaller. Are we in a steady state here? Is this industry in flux?
Yeah. It's a true observation, if you looked back even the two or three years prior to the most recent period, there was some consolidation happening there as well. I think on balance, the way I look at it is that it's a positive, it's positive for the obvious reasons. Maybe they're not as obvious as group benefits is becoming a more important part of the overall P&L of the major players in the space. In the past, if you just looked at group benefits, you'd have some of the top 10, where that just was not that important of a business to their corporate structure. Now, you see it's become through this consolidation, these are big and important businesses to each of the names overall.
Having bigger competitors where they've got good data sets to make pricing and underwriting decisions, that the earnings stream and the predictability of the earnings stream is an important component to overall EPS. That's good news for a focused player like Unum. What's the right number over time? It's hard to say, but I would say in general, HR technology is moving and changing very rapidly. Complexity around things like managing statutory disability and leave adds a fair amount of operational complexity. All these sort of speak to the kind of what is required to play successfully, I think, continues to go up. Sometimes you get an industry report, and if you print it out, it literally flips a couple of pages of the number of companies still in the space.
Again, I don't have a crystal ball, it would seem to me that there's probably some consolidation still to come.
In terms of, I guess the marketplace consolidation as an individual that offers a lot of products at Unum. Not everyone offers Long-Term Disability, short-term disability, life, dental, vision, AD&D. I'm probably missing one of the supplementary benefits out there.
Yeah, individual disability.
Individual disability. What is the marketplace like? Is there a key advantage of selling all the products? Is the cross-sell an important part of the market? Are there clients who want you to provide the full suite of products in order to have to talk to you? How's that look? Because obviously, you've gotten there through some M&A also.
Right. Broadening the client relationship through offering more and different types of benefits is right at the heart of the strategy. It's about the employer, the experience we deliver to them, and in creating pull demand for other products. It fluctuates by a few percentage points, but think about it in terms of two-thirds of all the new sales Unum will report will be two existing clients. Those will be new lines added. There will be upgrades to contract terms and benefit richness. It'll be re-enrollment of the employee population. That's front and center and having a broad, it's kind of funny, but it's a broad array of product within our niche. Which is non-health, non-retirement employee benefits, 100% delivered through the worksite.
It is quite helpful, to your point, to have a very broad array and the addition through the Starmount acquisition that we made a little over two years ago, that added a really strong dental vision capability into that set. That was probably the missing component part. We also started with a through partnership entry into the medical stop loss business. That's another typical ancillary coverage you can bring to the employer. We wrote about $10 million last year. We hope to more than double that this year. Over the next three, four, five years, that becomes more important. Really covering the waterfront when it comes to our slice. If I took a step back, to be honest, we're a bit more of a niche player than most competitors. In general, we're not a health insurer, and a number of our key competitors are.
We're not a property and casualty insurer, although a number of our competitors are. We're not a retirement individual life annuity player, which a number of our competitors are. For us, what that's meant is the benefits of focus on what we do. Everybody that knows technology at Unum Group, the only technology that they spend time thinking about is technology that is relevant at the worksite. Where our most talented leaders go, it's into the employee benefits, group, and voluntary businesses. It's kind of funny, but if you think about it on those two dimensions, it is relatively a niche strategy that we have with a lot of growth opportunity, but it's about having a pretty broad product set within that niche.
In terms of Starmount, you put it on two years ago, it was obviously going to generate a certain amount of business. Is there a way we can gauge whether that's ahead of plan, on plan? I guess, was there really a five-year plan? Like, how will we know-
Yeah
the flow of business, say, "Oh, this was a home run for us." What are your internal sort of benchmarks there?
Yeah. When we acquired the business, at around a couple hundred million dollars of revenue, we said that, once we had it integrated in, and we've been a little over a year, where it's been fully integrated in and nationally distributed, we said we wanted to make that a $500 million business over five years. I'd say we're well on track to that. It's a great company down in Baton Rouge, Louisiana. What's really a great fit strategically is dental and vision experts, they know how to build networks of providers, dentists, optometrists. They know how to handle the pretty massive volume of claims that come through. It's a manufacturing plant there in Louisiana, but we have distribution out through the Colonial Life career agency distribution that is really targeting the small end of the market directly in the public sector.
The Unum branded distribution takes it out through independent brokers and consultants. The combination of the two, we took a small family-owned business, and in about two years, we've reached the very bottom of the top 10 market share in terms of group dental new sales, and we have just cracked into the top 10 from a network size as well. Feel great about that business and the growth trajectory. For the Unum brand, overall, we talked about 6%-8% sales growth here in 2019. Two full points out of that, give or take, are the growth of the dental vision business. We get to 2020, it's going to start showing up as a big driver of earned premium, and then by 2021, it's an earnings growth engine for us.
If we compare the Unum brand targeted customer with the Colonial targeted customer, how do the two customer profiles differ? Should be the targeted return the same? Or should you be able to get more out of a Colonial return
Yeah
over time? Where, I guess, the product suite on voluntary, can you drive supplemental and voluntary better through Colonial than you can through Unum or vice versa?
Right. Yeah, no, it's a great series of questions. Colonial Life, headquartered out of Columbia, South Carolina, voluntary benefits company. Think primary products being things like voluntary short-term disability, accident, Supplemental Medical, Term Life Insurance, and now dental, Voluntary Dental Insurance being a big driver for them as well. Direct agents, their primary focus is the small employer markets. Think about employers under 100 employees. They're out there every day calling directly on those small employers, offering to expand that employer's benefit plan at no cost to them and provide benefits education and communication on the full benefit set. That is a market that is very attractive for a couple of reasons. One is, it's the one part of employee benefits that there's a lot of white space, and there's more white space than there is penetrated market.
Whereas once you get up over 500 employees, you're in the 80% type penetration for most of these products. When you win, you're taking it from another carrier and competing that way. In the small end of the market, very often, it's new coverage to that employer. There's an opportunity to grow de novo. Colonial Life, direct agents, very good in the small end of the market. They've also built a real competence around the public sector. Municipalities, state-level employee benefits packages, that's been a really important growth engine for them. They work through independent brokers as well, and they play into the large case market, but I'd say that's more opportunistic for Colonial Life. Targeted returns actually are very similar, so we're looking for mid teens return on equity for those products, and very similar to what we target on the Unum side.
Unum tends to sell more in the 100 and up market. We exclusively use independent employee benefits brokers and consultants.
When a Colonial direct agent goes into a workplace, is this a workplace that's often been already penetrated by an Aflac or a Allstate, I guess? It's basically it's the Wild West out there.
Yeah.
You'll find there's a lot of businesses that haven't even sold benefits anyway.
Yeah. I think the stats would tell you about a third of the time there's somebody in force there. It might be one of the carriers you mentioned. It might have been the Blue Cross Blue Shield that put the health in, may have put in some ancillary products as well. About two-thirds of the time, when you're in that under 100 life market, it's white space. It's unpenetrated. I don't know if that's the Wild West entirely, but that's what it is.
No. I'm thinking of some very sophisticated client who might want to buy something that doesn't have any allegiances.
Right.
That's good. If we think about the Unum side of the equation, we've seen a lot of technology invested in the delivery of benefits-
over the past decade. That architecture's typically built by vendors who sell their products, your product through them.
To what extent is that an opportunity for you? To what extent does that disintermediate you? To what extent does that allow competitors to put their products onto a platform that you're already on?
What do you see as, I guess, the delivery mechanisms? Is that long-term positive?
Right
Is it just like that's the technology, it's going to be what it's going to be, and we're going to adapt?
Yeah. Well, it's probably a little bit of both, but I'd say on balance, it's quite positive. There's a couple of reasons for that. I think one of the most important trends that hit employee benefits, particularly the financial protection products like we're in, is actually not specific to our industry, and it's the growth of cloud-based software as a service models for HR. What has happened in literally just a decade is good HR technology has gone from being just in the purview of the very large employer, implementing on-prem solutions customized to the employer, often as part of a broader kind of ERP suite. There's been some real disruption that's come into the market, a pretty rapid move towards cloud-based systems.
All of a sudden, I don't know if 10 years is overnight, but in a pretty short period of time, you've got really pretty darn good HR technology that's available from the very large all the way to the very small end of the market. You've got it in single instance, right? That's the principle of the cloud solution. As a firm like Unum goes deep in terms of integrating the data flow and the capability with that cloud-based platform, they've opened a door to a whole set of employers that may have been challenging from a cost, from an operational complexity point of view to meet. For Unum specifically, the best example for us is the platform Workday. It's probably the fastest-growing. At one point, it was the fastest-growing cloud solution across every vertical.
They've really taken off in the HR human capital management space. That's a big series of investments that we made, is integrating our processes into that Workday platform. That's proven to be a real difference maker for us, and it has opened doors that weren't there previously. I think there's expanded distribution opportunities. I think there's opportunities to streamline the insurer's processes, and with that streamlining, reduce costs. For Unum US, you would've seen about a 200 basis point improvement in our operating expense ratio over the last four or five years. I would see some continued leverage there on the OE front, and a significant part of that will be digital technology and integration with these HR platforms.
A couple questions. One is you mentioned the 16% to 18% ROE. Is there any product meaningfully below that which you may be dental given the ramp or which products are there or not there yet?
Yes. I probably should repeat the question, right? Yeah. The question 16% to 18% ROE and mid to high teens ROE, that's a pretty, I think across the U.S., Unum and Colonial Life portfolio, pretty common target where we kind of manage to over time. Because most of the business is repriced on a two or three-year cycle, you can get to that. What differs by product is not so much the return on equity, it's the margins as a percentage of premium because the capital behind the products are different. You mentioned dental, that's a great example. The margins as a percent of premium will be lower on dental because the capital is so much lower. Return on equity, you can get to that level with lower margins over time. Short-term disability is a lower capital product.
Long-Term Disability, our Executive Individual Disability, those are examples of the more capital-intensive products where the margin as a percent of premium has to be higher.
Question. The HMO stocks have been slaughtered as they're trading at-
You got to speak in the mic.
HMO stocks slaughtered, low multiples. How are they behaving in some of your, I mean, it's ancillary products to them, it's your core products. How are they behaving in LTD in Group Life, and how do you expect them to behave given what's happened in a Bernie Sanders rhetorical world here?
Okay. Ooh, that question took an interesting twist there at the end. What I would say is that when it comes to disability insurance and life insurance is for us, so often integrated. There's a couple of key contract features that make packaging with life and disability pretty important. The barriers to entry there are pretty high. And because LTD is more capital intensive, some of the managed care players and really just other players in general, have been a little bit more apprehensive about jumping too aggressively into some of those markets. But where maybe the phenomena we see a little bit more is in the voluntary benefits part of the market, the supplemental health products, the accident, the critical illness type products.
That market's growing a bit faster, because of its obvious connects to healthcare, I think that's a place where we have been watching new entrants come in from the health space, from the life insurance, and both public and mutual space. That's a part of the market that I'd see we've seen a little bit more new entrant and competitive activity. There again, the problems are different so it's much less the capital intensity, it's much more on the voluntary side, the complexity, the benefit. What I mean by that, if you just take a step back and say, okay, voluntary benefits. As soon as you go to employee paid benefits as an employer, some things happen immediately. Now I have to actually explain my benefits to employees so that they can make a purchase decision at enrollment.
Based on that purchase decision, I actually need to deduct from their paycheck based on the choices that they made. I got to reconcile that to the carrier's billing process. Probably most importantly, if I have 100 employees, now I have 100 different benefit plans, right? Everybody's made different selections. When it comes time to access those benefits, I don't have the simplicity of kind of a one-size-fits-all anymore. While I could see a little bit of churn and chop in the voluntary market currently, I think in pretty short order, what becomes apparent is to have the technology, the process, and the expertise to actually deliver into that complexity effectively will help shape things out a way, I think a little bit.
Last question I have. If I was a top manager or a board member at Unum, I would ask somebody who's been there 25 years how they would fix Dacor, which is near major business sold for 19 times. Unum is selling it at six times. How would you close that gap?
Yeah. That's a great question. I think about that a lot. I should ask the room, what their investment thesis these days. Certainly as I talk to investors, one of the things that's top of pretty much everybody's mind is the closed block of business. The drag, and I'd say more so the uncertainty of the long-term care discontinued book of business is something that investors want to kind of get their arms around and I think are cautious about it. If I thought about the sum of the parts analysis, I think you've got some Our active businesses, they're in very good markets. Their performance has been remarkably consistent, I would say. There's the uncertainty around the closed block that I think ends up depressing some of those multiples.
That's, without going too far down the path, I don't manage the closed block, but I'd say as we have put a ton of time and energy into really building out the data set, applying the actuarial expertise, understanding and beginning to chunk out that business. We're always looking at what are the options around reinsurance. Do people have interest in taking some of that risk over time? We've been very active and quite successful in terms of rate increases, which you've got to pursue at the state level across all 50 states. Over time, I think it's about understanding that business, getting investors more comfortable with it, getting regulators in a place where it's adequate and sustainable, and that's just a process that's going to take some time.
I guess a follow-up to that, I'll give you multiple choice. Good idea, bad idea, or really bad idea. I think some people in the market have put long-term care hold about the value of the hold.
Would you ever sell Polloi for the long-term care business?
Oh, I have never thought about it. Is that E, option E? None of the above?
It's a really bad idea.
I'm D, I think. I don't know.
Was that you? I skipped you entirely, didn't I?
It doesn't work exactly. Doing that transaction work. In terms of thinking about capital, there is growth. It's really having the voluntary products, which have low capital charges.
You're slowly growing in the core, frankly. It seems like you're not consuming a lot more capital than you were a year ago.
Your buyback is pretty much steady Eddie. You suspended the buyback while everyone was awaiting the big LTC announcement, but I can pretty much guess the buyback's going to be into Q 2019. That's going to be $100 million, something tells me. We'll see if I'm right or wrong on that one. Why can't it be higher? You reauthorized $750 of buyback, but that might just be that we're always going to be at $750, and every year we're going to just true it up. What are the impediments to buying back more of your stock at six times earnings when StanCorp went for 19 times?
Yeah. First thing I'd say is what a great set of businesses from a cash generation point of view, and I think that's sustained. It's a good spot to be in. These are good businesses with healthy margins, with consistent free cash flow generations, which is great. Uses of that cash, like you said, pretty consistent. Both in terms of share buyback, but also in terms of pretty steady and meaningful increases to dividends that I think we've demonstrated. That certainly is a priority for us. We will always keep an eye open. The Starmount acquisition is a good example. We made a small acquisition in Poland. We made a small acquisition of a leave employee planning tool called LeaveLogic. We're going to constantly be looking for small opportunities.
I'd say more often than not, they'll be capabilities versus blocks of business, but we'll keep an eye on both. We had a pretty significant set of uncertainties to work through with the changes to the tax law. For reasons like that, accounting changes that make having a bit of a buffer a pretty practical and useful thing to do. If the bottom line question is that current multiples is our own stock a good buy from our point of view, I think that is true. Any other use of the cash would have to have a clear, pretty high hurdle rate given where we think we ought to be trading.
I guess how much cash are you generating that can be put to either growth, M&A, buybacks, dividends? Is it a projected? You can even think in historical 2018. There might have been some changes to your capital because of taxes, because of LTC. Long term, do you have sort of a run rate about how much cash you think this company can generate over the next five years on an annual basis?
It's a good question. To be honest with you, I don't know how public we've been about projections on cash flow. I know we've talked at Investor Day about a capital generation engine that produces around $1 billion a year. I think that's directionally pretty accurate. As we grow the business, I think that's a reasonable CAGR to put on that.
In terms of the capital constraints on that growth, the rating agencies and the regulators, are there any changes that they can pressure you in terms of how much capital support you need to support that growth going forward?
Boy, trying to project what's going to happen in terms of rating agencies or regulators is tough. I think that's part of the reason that you want to make sure that you've got a really sound footing, which we have from a capital point of view. I wouldn't say there's anything immediately in the offering. Feel good about where we are from a ratings point of view and what our dialogue, which remains a very active one, is with each of those entities. Yeah. That's kind of where we sit.
Are you fully committed on the debt side of things at this point, do you think? Is there more on the financial structuring that you can do?
Like would we drive up leverage? Is that sort of the question?
Maybe drive up a little leverage. I don't know. Maybe after 2018 doesn't feel so good to do.
Right
you know.
Yeah, no, I'd say in general, we're pretty comfortable with where we are from a leverage point of view. That'll bump up and down a little bit, depending on just the windows of opportunity around when do we want to go to market versus the maturities that are coming up, but that's temporal and short term in nature, and I think we're probably about where we want to be from a leverage point of view.
In terms of, I guess the last time, I mean, on tax. You mentioned there might be in the future some modest pricing in an efficient market. Overall, are you maximizing your tax obligation, or is there future room to bring down the tax rate over time?
Certainly, some of we're very diligent about making sure that we understand. There's nothing that I would see either in terms of thinking differently about our pricing strategy related to tax, to your earlier question, or just how we approach taxes in general. Nothing I'm aware of. I think our story is going to continue to be one of just being a disciplined underwriter. I'd say a part of our story, and probably will be in the coming years, will be using technology and process to continue to find leverage in that operating expense ratio. Above all, it's about recognizing the growth opportunities that are inherent in the ongoing business.
We feel like if we can be in that 4% or 5%, 6% top-line growth, bring earnings growth through the levers I just mentioned closer to that range, and be in the kind of businesses where we can make adjustments when we need to, that's a good spot to be in.
Well, we'll open the floor to questions. Ron, you've been very diligent with your questions, but anyone else have any other questions? Well, I think we're good.
All right.
I appreciate it, and thank you for your time. Thank you for coming, and enjoy the rest of the conference.
Thanks for having me.
Great.
Great.
Thank you very much.