Executives: David H. Lissy - Bright Horizons Family Solutions, Inc. Elizabeth J. Boland - Bright Horizons Family Solutions, Inc.

Analysts: Andrew Charles Steinerman - JPMorgan Securities LLC Gary Bisbee - RBC Capital Markets LLC David Chu - Bank of America Merrill Lynch Ryan Leonard - Barclays Capital, Inc. Jeff P. Meuler - Robert W. Baird & Co., Inc. Henry Sou Chien - BMO Capital Markets (United States)

Operator: Greetings and welcome to the Bright Horizons Family Solutions second quarter 2017 conference call. At this time all participants are in a listen-only mode. An interactive question-and-answer session will follow the formal presentation. As a reminder, this conference is being recorded. I would now like to turn the conference over to your host, Mr. David Lissy. Thank you. You may begin.

David H. Lissy - Bright Horizons Family Solutions, Inc.: Thanks, Matt, and greetings from Boston. Hello to everybody on the call today. Joining me as usual is Elizabeth Boland, our Chief Financial Officer, and she'll go through a few administrative matters before I kick off the call. Elizabeth?

Elizabeth J. Boland - Bright Horizons Family Solutions, Inc.: Hi, everybody, and thanks for joining our call today. For reference, as mentioned, this call is being webcast and the earnings release that we issued after the market closed today, as well as a recording of today's call, are or will be available under the Investor Relations section of our website brighthorizons.com. Some of the information we're providing today will include forward-looking statements, such as those regarding our growth and operating strategy, our financial outlook for Q3 and the full-year 2017, as well as expectations for measurements like revenue growth, operating margins, contributions from acquisitions and lease consortium centers, integration costs, financing costs, business segments, our growth pipeline, center openings and closures, capital investments, foreign currency rates, tax rates and expense, adjusted net income and EPS, cash flow and share repurchases. Forward-looking statements inherently involve risks and uncertainties that may cause actual operating and financial results to differ materially. These risks and uncertainties include those described in the risk factors of our Form 10-K and in our other SEC filings. Any forward-looking statement speaks only as of the date on which it's made and we undertake no obligation to update any forward-looking statements. The non-GAAP measures that we discussed are detailed and reconciled to their GAAP counterparts in our press release and will also be included in our Form 10-Q when filed with the SEC and available, as the other filings are, in the Investor Relations section of our website. So back to you, Dave, for the review and update on the business.

David H. Lissy - Bright Horizons Family Solutions, Inc.: Thanks, Elizabeth, and hello, everybody, again. As usual, I'm going to update you on our results for this past quarter and provide you with our updated outlook for 2017. Elizabeth will then follow with a more detailed review of the numbers before we open it up for your questions. So to begin, we're pleased to continue our strong performance in the second quarter of 2017. To recap the headline numbers for you from this past quarter, revenue increased 11% to $446 million, adjusted EBITDA increased $6 million to $87 million, and adjusted earnings per share of $0.74, increased 21% from last year. Also, as we previewed on our last call, we continued to experience roughly a 2% FX headwind related to our U.K. operations in the first half of this year. Therefore, on a common currency basis, revenue would have approximated 13% in Q2. Likewise, the growth in EBITDA and adjusted EPS would have also been proportionally higher. Our top line growth of $43 million included solid contributions from each of our three lines of business. We welcomed 13 new centers this past quarter, notably a high quality group of seven centers in the Netherlands, which expands our footprint to about 40 in Holland. In our back-up division, revenue increased 13% this past quarter on new client launches, expanded utilization and rate increases. Revenue growth in our educational advising segment rebounded to 26% for the quarter. Recent new client launches for both of these segments include Northwell Health Systems, Raytheon, the Verizon and CWA, Advocate Health Systems, and Aetna. As we've discussed with you on prior calls, the timing of when new clients launch their service with us can contribute to some variability in the quarter-to-quarter growth rates, but as we look ahead to the second half of the year, we're pleased to be tracking well toward our 2017 targeted growth levels of 10% to 12% in the back-up segment and approximately 20% in the ed advising area. We also continue to deliver strong and consistent results in our core operations, even as we make investments to support continued growth and efficiency and expand the business in strategic ways. Operating margins of 13.2% for the quarter, which excludes one-time expenses for our May debt amendment, are in line with our previously discussed expectations for the year. As a reminder, there are three notable areas that are and will continue to impact margins in 2017. First, the 90-center Asquith acquisition we made in the U.K. in the fourth quarter of last year contributes significant revenue in 2017 with margins that are consistent with the rest of our U.K.-based full-service centers but are lower than our U.S. business which benefits from the mix of the higher margin back-up and educational advising services. In addition, we expect to incur approximately $2.5 million of integration type costs in 2017 before we fully realize the synergies that we targeted. The second component relates to the short-term effects on margin from our newer lease consortium centers that we've previously talked with you about on several prior calls. We've opened approximately 65 of these centers since the beginning of 2013 as part of our long-term growth strategy and are again on pace to open another cohort this year of approximately 10 to 15 of these centers. While we're still ramping to a critical mass of mature centers in this cohort, the revenue contribution from these centers is significant, roughly $120 million expected in 2017, but the associated margin contribution is still modest. As we've discussed on prior calls, we expect that this headwind will naturally diminish as these more recent classes ramp up, unlocking the value creation that exists in this group of centers. The third element that we've called out relates to our investments in technology and people to enhance our customers' user experience, build utilization levels of our services within our client workforces, and over time deliver a more efficient and automated support service. Although we're investing in our full-service segment, our back-up and ed advising businesses have more embedded technology in their service delivery systems so we see somewhat more of an impact in these segments. In summary, these components will offset other underlying operating leverage in 2017. Then, in 2018 and beyond, we expect to regain our longer-term targeted operating margin leverage of 50 to 100 basis points. As we move on to the second half of this year, we do so with good momentum across all aspects of our business. The integration of the Asquith acquisition remains on track as our respective teams have worked closely on the integration strategy, and we remain on track to realize the full value of our investment next year. Our growth strategy continues to be focused on organic as well as acquisition growth and leveraging the breadth of our existing client base to cross-sell our additional value-added services. Our sales pipeline in each of our services remains strong, with interest both from new clients and with cross-sell opportunities. The industry verticals that represent the most activity at this point in the year are healthcare and biotech, higher education, and technology. We remain in a good position to achieve our organic growth plan in 2017 and at the same time build our pipeline for next year. On the acquisition front, after an outsized year in 2016, we expected to have a more typical year of tuck-in acquisitions this year even as we continue to pursue our opportunities that range in scale. We continue to cultivate new prospects in our pipeline, and we have a good mix of smaller networks and single center opportunities in active discussions both here in the U.S. and in Europe. Moving to the balance sheet side of things, with strong operating cash flow, our revolver and access to capacity when needed, we remain in a good position to take advantage of any strategic opportunities that may arise. Our first priority remains growth-oriented investments in acquisitions and new lease consortium centers, with the second priority to enhance shareholder value through our share repurchase program, which we've also continued to execute this past quarter, including our participation in a block trade this past May. So now on to the outlook for the remainder of the year. We continue to expect to generate revenue growth for the year in the range of 10% to 12%, which includes an FX headwind from the pound compared to 2016 that'll end up approximating 1% for the full year. We expect that this, in turn, will drive adjusted earnings per share growth of more than 20% for the year to a range of $2.62 to $2.65 per share. Before I turn it over to Elizabeth, let me take a moment to discuss our announcement today of my plan to become Executive Chair and Stephen Kramer's transition to CEO on January 1 of next year. As most of you know, this is my 20th year with Bright Horizons and I couldn't be more proud of what we have accomplished over that time, and at the same time, incredibly excited about what lies ahead for us in the coming years. Many of you have met Stephen and know of his long tenure with Bright Horizons, his success growing our international operations, and his creative leadership in developing and evolving our back-up and educational advising areas. He has served successfully overseeing virtually every aspect of our business and has my full confidence and that of our board to continue to build in our long track record of success. In my new role, I'll still be full-time engaged helping him to explore and develop the many opportunities that we have to grow and create value around the world. This transition is the latest example of our deep commitment to succession planning at every level of our organization. This commitment has allowed us to attract and engage a long tenured and talented executive team who share the unique blend of leadership qualities which contribute to and represent our culture and are well-positioned to help us drive quality and achieve results in all we do. Stephen uniquely represents his talented leadership group, combining his roots as an entrepreneur with a strategic vision for service delivery. He and I have worked closely together for over a decade and he's been integral to developing and executing our long-term plan. As a result, going forward, you should expect a continuation of a long-term strategy that we've been pursuing and executing on for several years, and I'm very much looking forward to working with him in his new role. Over the next five months leading up to the transition, Elizabeth and I will be out on the road with Stephen to introduce him to those of you who have not yet had the chance to meet him. So with that, Elizabeth, I'll turn it back over to you to go through the numbers in a little more detail, and I'll be back for Q&A. Elizabeth?

Elizabeth J. Boland - Bright Horizons Family Solutions, Inc.: Great. Thank you, Dave. So again, to recap, overall revenue was up 11% or $43 million in the quarter. In order to get into a bit more detail, let me take out the 2% FX effect so that on a common currency basis, we're talking about the overall top line growth of 13% for the quarter. The organic growth approximates 7.5%, with 5.25% coming from full-service and 2.25% coming from back-up and ed advisory. Acquisitions, most significantly, the Asquith centers, added a further 7% growth in the quarter and center closures offset top line growth by about 2%. On a segment basis, the back-up division expanded over $6 million on the top line or 13% and ed advisory services were up $3 million or 26% from new client launches and the expanded utilization of our services by our existing clients. The $35 million increase in full-service, which is $43 million on a common currency basis, was driven by rate increases, enrollment gains in our ramping of mature centers and contributions from new centers. In Q2, gross profit increased $10 million to $114 million and was 25.7% of revenue, and our operating income increased to $59 million or 13.2% of revenue, excluding the transaction costs associated with our debt financing which approximated $2 million. On a segment basis, we generated operating income of 27% in back-up and 20% for ed advisory this past quarter. As previously discussed, both revenue and margins in back-up and ed advisory can vary a bit from quarter-to-quarter based on the timing of new client launches and the service utilization levels. Also, as Dave covered, we're making investments in technology and people to enhance the end user experience to expand the consumption of our services, and over time, to increase efficiency of our service delivery. Similar to last quarter, the short-term effect of these investments are reflected in lower operating margins in 2017. That said, the operating margins for these two segments are two to three times what we earn in our full-service centers. So as we look ahead to 2018 and beyond, we continue to see their revenue growth and operating performance contributing to margin expansion over time. Turning to full-service, gross margins in 2017 is roughly consistent with 2016 levels with a couple of offsetting factors. The gains from enrollment growth in our mature and ramping centers are disciplined pricing and cost management, and the contributions from new and acquired centers, including the Asquith group that we've mentioned, are partially offset by the margin effects of the recently opened classes of lease consortium centers which are still in their ramp-up stage. At the operating income line, increased overhead spending, which I'll talk more about in a minute, and amortization arising from the Asquith acquisition, were also headwinds to operating margin growth. For the second quarter of 2017, overhead was $47 million compared to $40 million last year, excluding the transaction cost from both periods. In addition to the typical growth spending to support our expanded operations, sales and marketing, two factors contribute to the increased spend. First, a portion of the additional spending on technology and related service enhancement initiatives is in the support overhead functions. Secondly, in connection with the integration of the Asquith business in the U.K., as Dave mentioned, we've incurred certain overlapping and onetime costs which temporarily increases the overhead spending in 2017. We are on track to realize the synergy that we'd planned from the combination of our support teams in 2018, at which point, we would then again expect to regain overhead leverage. Interest expense was $10.7 million in Q2, roughly consistent with 2016 levels as lower interest cost offset the incremental borrowing to finance the Asquith acquisition. As we've previewed on our last call, we amended our credit agreement in May of this year. In addition to extending our revolver term out to 2022, the amendment reduced our interest rate by 50 basis points essentially to LIBOR plus 2.25%. This largely neutralizes the impact of interest rate increases in 2017 and puts us in a good position to broadly maintain financing costs at Q2 levels for the rest of the year. We ended the quarter at 3.5 turns of net debt-to-EBITDA and would expect that to tick down slightly by year end. Our estimate of the 2017 structural tax rate on adjusted net income is now 26%, down slightly from our previous estimate of 27%. In addition to realizing the favorable effects of lower statutory tax rates in our U.K. and Netherlands operations, the new accounting for the tax benefit on certain stock compensation transactions has reduced our effective rate in the U.S. as well. We generated operating cash flow of $168 million in the first half of 2017 compared to $147 million last year, on improved performance and working capital. After deducting maintenance CapEx, our free cash flow totaled just over $140 million through June. As Dave outlined, we've invested in growth through new center investments and acquisitions, and we've repurchased around 1 million shares year to date, both through modest open market purchases and with one block trade. At June 30, 2017, we operated 1,047 centers with the capacity to serve over 116,000 children, and we now serve over 1,100 clients across all of our service lines. Our outlook for 2017 anticipates top line growth approximating 10% to 12% over last year. In our full-service center network, price increases are averaging 3% to 4%, and we continue to build enrollment in our mature and ramping base of centers. In the full-service segment, we're planning to add a total of approximately 50 new centers in 2017, including organic new and acquired centers. Our outlook also contemplates closing approximately 25 centers. On the operating side for 2017, we expect adjusted operating income margins to be broadly consistent with 2016 levels, around 12.25% to 12.5% of revenue. As we've previously outlined, the approximate headwind from the three factors that impact our operating margins in 2017 I'll re-summarize as follows: the inclusion of the Asquith group of centers represents 40 to 50 basis points of overall operating margin headwind due to the contribution at full-service margin levels plus the incremental overhead integration spending; second, the lease consortium centers, new in 2017 and opened last year, contributed 10 to 20 basis point near-term drag on margins; third is the 40 to 50 basis points related to the increased spending on technology, software solutions and people to strengthen our market position and service capability over time. On some other key measures for the full-year 2017 and including acquisitions that were completed last year, we estimate amortization of $33 million, depreciation of $65 million. Based on our outstanding borrowings and the updated terms of our amended credit agreement effective mid-May of this year, we're projecting interest expense of $43 million to $44 million for the full year. As previously reviewed, the structural tax rate is now estimated to approximate 26% in 2017, which is the rate that we applied in Q2. Weighted average shares outstanding are projected at 60.5 million now for the full year. We estimate that we'll generate approximately $200 million of free cash flow with $240 million to $250 million of cash flow from ops and $40 million to $45 million of estimated maintenance capital spending. Investments in new center capital for centers opening this year and in early 2018 are estimated to total around $40 million this year. So the combination of all of these elements lead to our projection that we'll generate adjusted net income of $158 million to $160 million and adjusted EPS of $2.62 to $2.65 for the full year 2017. Before we go to Q&A, let me look specifically to Q3, where we're projecting 11% to 13% revenue growth and 22% to 25% adjusted net income and EPS growth, with adjusted EPS in the range of $0.60 to $0.61 a share on 60 million weighted average shares outstanding for the quarter. So, Matt, with that, we are ready to go to Q&A.

Operator: Great. Thank you. At this time, we'll be conducting a question-and-answer session. And our first question comes from Andrew Steinerman from JPMorgan. Please go ahead.

Andrew Charles Steinerman - JPMorgan Securities LLC: Hi. Elizabeth, when you...

David H. Lissy - Bright Horizons Family Solutions, Inc.: Hey, Andrew.

Andrew Charles Steinerman - JPMorgan Securities LLC: Hi, it's Andrew. When you look at the portfolio of lease consortiums, you mentioned that it's a drag this year of 10 to 20 basis points. Could you help us look into the future where you look at the whole portfolio, like do you feel like the new centers are going to be a drag again in 2018? Just give us the evolution going forward in kind of the margin profile of lease consortiums?

Elizabeth J. Boland - Bright Horizons Family Solutions, Inc.: Yeah. So in the micro – the class, obviously, they're opening throughout the year, but as a class, the centers will generally be breaking even around 15 months to 18 months. So what we have this year is a drag based on the five classes, if you will, that are now open, and it's a 10 to 20 basis point drag this year. We would expect, as those centers, that group is now maturing and getting to break even, that the centers that we have, a loss on is limited next year to a few that open late this year, and the 2018 class. So as a group, the lease consortium centers would be contributing more like 10 basis points to 20 basis points rather than be a headwind of 10 basis points to 20 basis points. That's part of what would contribute to the turnaround and the operating margin growth there.

Andrew Charles Steinerman - JPMorgan Securities LLC: Perfect. And the tech spending is really this year, right?

Elizabeth J. Boland - Bright Horizons Family Solutions, Inc.: Well, the step up in tech spending is this year and although we expect to continue to make investments in that arena, it wouldn't be the same kind of step up of spending that we're talking about this year. So in terms of comparing year-over-year, we wouldn't see that as a headwind in that way.

Andrew Charles Steinerman - JPMorgan Securities LLC: And last question, how is the tech spending going? What is the user experience on the new technology?

David H. Lissy - Bright Horizons Family Solutions, Inc.: Yeah. Andrew, so we've been rolling out a variety of things this year and like any new system rollout, the first period of time has its challenges, so we've resourced it really closely backing it up in our contact center to be sure that we have extra support during that time. But for the most part, things are stable and moving forward and now that it's stable, we're really pleased to see some of the applications in progress and the hope will be that it will, as I said, over time, in prior calls, that we'll automate much of the user experience, particularly in back-up, that currently requires human intervention through our contact center and drive, eventually drive more use in our back-up program which is the aim. So, we're still in the early stages but rollout has begun.

Andrew Charles Steinerman - JPMorgan Securities LLC: Great. Thank you.

David H. Lissy - Bright Horizons Family Solutions, Inc.: Yeah.

Operator: Our next question is from Gary Bisbee from RBC Capital Markets. Please go ahead.

Gary Bisbee - RBC Capital Markets LLC: Hey, guys. Good afternoon.

David H. Lissy - Bright Horizons Family Solutions, Inc.: Yeah.

Gary Bisbee - RBC Capital Markets LLC: Dave, you better not be a stranger in this new role. It won't be the same without you running the calls and everything else but congratulations on the decision to move in a new role next year. I guess, getting on to questions, so I continue to get a lot of questions about the lease consortium economics and I wondered if I could just ask a couple of high-level questions about that, relative to how you framed it in the past. So when you started to really ramp up the strategy, you talked about, at maturity, being able to earn a higher gross margin from this despite some of the higher startup costs, in part because of the larger scale of some of the centers. And I guess, is that...

Elizabeth J. Boland - Bright Horizons Family Solutions, Inc.: (24:45)?

Gary Bisbee - RBC Capital Markets LLC: Yeah, right. And so, is that happening in like the 2013 and 2014 classes? Have you been able to achieve that, and if not, what's the time to maturity to sort of prove out that higher profitability?

David H. Lissy - Bright Horizons Family Solutions, Inc.: Gary, first, I'm not planning on abandoning any calls anytime soon, so ...

Gary Bisbee - RBC Capital Markets LLC: Okay.

David H. Lissy - Bright Horizons Family Solutions, Inc.: ... thank you for the congratulations, but the – to answer your question specifically, the – what gives us, what heartens us about the continuation of the strategy and the desire to continue to open more of these centers is the performance of the early year classes. So to your question, the 2013 and 2014 classes, there's always going to be one or two that are sort of off outside of the zone either way, meaning really good or not on track relative to the ramp-up schedule that we hope. But as classes, they are performing according to the metrics that we had discussed, and so, it tells us that it's a good investment for us to make. We're seeing returns on the investment, even though some of the startup cost were more and because of the locations, we have to invest a little more in these centers than we do in more rural locations, but the returns are there. And so, we're looking forward to, obviously, the later classes maturing. Little too early to declare victory on that because they're still in – many of them are still in process but we like what we see.

Gary Bisbee - RBC Capital Markets LLC: And how much of the economics of that is providing capacity to the back-up business? And do you credit that like at some sort of fixed day rate? I'm just trying to think, with the margins much better there, is that a big part of the economics or the desire to continue to open these?

David H. Lissy - Bright Horizons Family Solutions, Inc.: So, what it is where the synergy happens between back-up and these centers are – is two-fold. One, where it's most significant because the way our back-up offering is structured, when a client buys the ability to utilize the Bright Horizons network and really, our extended network that aren't Bright Horizon centers for back-up care, the more back-up care that we're able – center-based back-up care that we're able to deliver in Bright Horizons centers, the better the economics are on the back-up side for us. Obviously, when we can deliver them in our centers, we're not having to pay another provider for that day of care. So when we look at new locations for these centers, a part of the calculus is the demand that we've seen for back-up, the actual use that we've seen for back-up in different geographies where we might not have been able to fulfill it ourselves. And so, that's where these centers really help to support the margins on the back-up side. And then – and the other factor is many – as we've talked about in the past, in many of these centers, because of where they're located strategically, we have clients who may buy dedicated back-up spaces in them for their employees. That is reserve these spaces for the use of back-up and the economics on that are really beneficial to us as well. So, those two things definitely play into. They play more into the economics on the back-up side than you see it on the full-service side. The dedicated back-up spaces would play into the full-service side and the use of the centers for the back-up network service would play into the back-up margins.

Gary Bisbee - RBC Capital Markets LLC: And then, just one last one at the risk of overdoing it, I think a concern a lot of people have had is that this may be somewhat more cyclical than your business has been historically, given a portion of the demand is more sold in retail model. As this becomes a bigger piece of the business, how concerning is that to you eight years into a U.S. economic expansion?

David H. Lissy - Bright Horizons Family Solutions, Inc.: Yeah. I mean, I think, look, we're certainly not immune, like anybody would be to, to sort of economic cycles and we've had – we certainly have had – we've been through them and we see sort of the impact and we've always had some portion of our center network on this model. We're certainly focused on a different geography this time than we were in past iterations of this strategy but we've always had these in our model. So, I think we saw how we perform and what the risks are during a downturn. I think what I'm heartened by is that we're opening these centers in locations that are within the macroeconomy. These are the best geographies and we're opening them in areas and servicing demographic that, I think, is probably the most resilient with respect to economic downturns. So, it's not to say that there wouldn't be some risk but I think as we experienced, because of the demographic we're serving and because we're talking about major metropolitan areas, the resilient – they prove to be really resilient the last time around.

Gary Bisbee - RBC Capital Markets LLC: Okay. Very good. I appreciate all the color.

David H. Lissy - Bright Horizons Family Solutions, Inc.: Thanks.

Elizabeth J. Boland - Bright Horizons Family Solutions, Inc.: Thanks.

Operator: Our next question is from David Chu from Bank of America Merrill Lynch. Please go ahead.

David Chu - Bank of America Merrill Lynch: Hi, thank you.

David H. Lissy - Bright Horizons Family Solutions, Inc.: Hi, David.

David Chu - Bank of America Merrill Lynch: And just to echo, congratulations to you as well, Dave.

David H. Lissy - Bright Horizons Family Solutions, Inc.: (30:27).

David Chu - Bank of America Merrill Lynch: So, just wondering if you had a chance to assess Brexit at this point in more detail. Just wanted to see if you guys expected to have a material impact to your U.K. operation.

David H. Lissy - Bright Horizons Family Solutions, Inc.: David, I can't really point to Brexit itself as really having any kind of effect on our operations. One element of our U.K. operations that's a little bit different than the U.S. operation, as you may know, is that we have fewer centers that are for one employer specifically in the U.K. And so, while we do have a few of them that are in the financial services field, as a whole, more of our centers, because of the U.K. subsidy and kind of how the reimbursements are structured over there, are consortium models. So, the risk related to, sort of say, the financial services sector is slightly less than it would be, say, in an area like New York, for us, where we have a high density of single site centers for financial services and we do around the country for that matter here in the U.S. So, it's slightly different over there but obviously, we're keeping our eyes on it like everybody is but we're not – and I can't point to it today as having a material effect.

David Chu - Bank of America Merrill Lynch: Okay. Thank you. And just as a follow-up, I know there are different types of centers but are any of Gymboree's assets of interest?

David H. Lissy - Bright Horizons Family Solutions, Inc.: I would say that we once, a long time ago, experimented with a model that was similar to Gymboree in a sense it was a free-standing enrichment kind of activity type program. We had acquired a small business here in Massachusetts and tried to expand it and it didn't turn out to be one of our better or wiser investments pilots. So, we decided not to continue them and we've closed them many years ago. So, it's not likely on our radar as a strategy at this point.

David Chu - Bank of America Merrill Lynch: Okay. That's great. Thank you very much.

David H. Lissy - Bright Horizons Family Solutions, Inc.: Yeah.

Elizabeth J. Boland - Bright Horizons Family Solutions, Inc.: Thanks

Operator: Our next question is from Manav Patnaik from Barclays. Please go ahead.

Ryan Leonard - Barclays Capital, Inc.: Hi, this is Ryan filling in for Manav. And obviously, I echo the congratulations as well. I guess, just in your new role, I mean, is there anything you see that you would be freed up to do in terms of focusing more on the sales end of things than the management side? Anything you kind of expect that you could see benefiting the sales pipeline going forward?

David H. Lissy - Bright Horizons Family Solutions, Inc.: Well, Ryan, look, I'm energized by this. I've got great confidence in Stephen and really my – as he and I have talked a lot about as we've been planning for this. There's plenty to do. There's plenty of strategic opportunities for us. There's plenty of public policy type of things to be sure we're pursuing. There's the continued execution of some of the things that we've been up to for the past few years. So, there'll be plenty, I think, for me to do to help ensure his success in his role and to help the company add value. I think as I've talked about earlier in many other calls, while it's not on the short-term radar, things like further international expansion, the pursuit of other opportunities for us to add value to our clients with services that make sense, all those kinds of things would be in the category of things that I'll be able to help Stephen with and help to ultimately drive more value for the company.

Ryan Leonard - Barclays Capital, Inc.: Great. And then I think in the past, we've talked about how things like child care tax credits and a lot of the focus on some of those impacts would somewhat be broadly positive, but I guess to ask kind of the flip side of that question, if there's some government incentive in the U.S. for child care, is there any risk at all that maybe some corporate clients would not be as inclined to set up their own full-service center or any other kind of impacts there that you could think of?

David H. Lissy - Bright Horizons Family Solutions, Inc.: Yeah. I would tell you that the – we've been at this a very long time, and we've seen many different administrations, both Republican and Democratic, and have been party to many, many discussions about opportunities to increase government investment in child care. I would say that that it's unlikely that anything nationally would occur, and more likely that things would happen locally in states and in cities as they've done in the past. And so, I think that the obvious piece for us is that we're serving – we're not just providing sort of the part-day type of early education, we're serving working parents who need the full complement of a full day and the hours that go with that. So most even of the state and local programs provide some aspect of subsidy or some aspect of provision for part day or part year care and that really even that is only a portion of what our demographic needs, which is the full-time service. So corporate clients really are trying to provide service that obviously is good quality for the children they serve but also serves the interest of their working parents that helps them be at work and be productive, and most of the government programs don't satisfy that full need. So in the places – I don't really look at that as a major concern for us. What I want to be concerned about is that when programs are contemplated on a local level that we're at the table and that in places where the private sector is going to participate in the provision that they're funded in a way that we can participate. And in some geographies, that's the case today, and some geographies, that's not the case today. But I don't know that anything that's being contemplated would really suffice with respect to what an employer is really looking to provide to their working parents.

Ryan Leonard - Barclays Capital, Inc.: Got it. Thanks. And just one quick one – the guidance that you gave, is everything – is the M&A impact and organic growth consistent with what you've given to the pack or was there any slight tweaks there?

Elizabeth J. Boland - Bright Horizons Family Solutions, Inc.: No. Pretty consistent. I mean, we don't typically – we have tuck-in acquisitions on that side in the typical guidance, and so, that is continued. We've been able to execute on a few of those, and the rest of it is consistent.

Ryan Leonard - Barclays Capital, Inc.: Thank you.

Elizabeth J. Boland - Bright Horizons Family Solutions, Inc.: Thanks.

Operator: Our next question is from Jeff Meuler from Robert W. Baird. Please go ahead.

Jeff P. Meuler - Robert W. Baird & Co., Inc.: Yeah. Thanks and congratulations from me, Dave, as well and congratulations to Stephen, if he's listening. I guess just to start out, on the ed advisory strength, anything to call out in terms of strength between the different services in that segment? The tuition assistance or tuition reimbursement management versus College Coach?

David H. Lissy - Bright Horizons Family Solutions, Inc.: Jeff, I would say that the tuition assistance or what we call EdAssist continues to be the faster grower, so it accounts for more of the volume. The College Coach is a steady performer. It continues to grow steadily and nicely but EdAssist really, when I look at both not only the performance in the quarter but the outlook with respect to the pipeline, I think that would be the stronger performer of the two.

Jeff P. Meuler - Robert W. Baird & Co., Inc.: Okay. And then, Elizabeth, on the College Nannies and Tutors acquisition, just can you rough – now that we're anniversarying it, can you roughly size up what the contribution has been from that to revenue and does it all fall in back-up care?

Elizabeth J. Boland - Bright Horizons Family Solutions, Inc.: Yeah. So, College Nannies and Tutors, as you – just as a reminder, is a – we acquired the franchisor of that network. And so, the overall revenue from the franchisor and one franchise that is managed under that is in the neighborhood of $3 million or $4 million.

Jeff P. Meuler - Robert W. Baird & Co., Inc.: And is that all in back-up care?

Elizabeth J. Boland - Bright Horizons Family Solutions, Inc.: It's all in back-up care, yes.

Jeff P. Meuler - Robert W. Baird & Co., Inc.: Okay. And on the tax rate, it just seems like I think it's the second quarter in a row where it's performing better than expected. Is it on the stock comp impact or just what's driving it?

Elizabeth J. Boland - Bright Horizons Family Solutions, Inc.: Yeah. It's primarily the stock comp impact. I mean, we're trying to estimate what will occur, what drives that is actual stock option exercises, and so, those decisions are made by the individuals who hold the option. So, we're doing our best to estimate what that activity will be but we don't have a super long case history yet. So, that's the main driver but certainly, the rates in the Netherlands and the U.K. are factors in the overall rate because as those businesses modestly gain in size over our overall portfolio and their tax rates are more in the high-teens to low-20s percent rate, that's beneficial to the overall rate as well because we're obviously at a federal and state tax rate in the U.S. that would otherwise be around 40%.

Jeff P. Meuler - Robert W. Baird & Co., Inc.: Okay. Thanks. And Stephen, sorry you have to suffer through these types of questions. More going forward. Thanks, everyone.

Operator: And our next question comes from Anj Singh from Credit Suisse. Please go ahead.

Unknown Speaker: Hi, this is Jeff (40:36) standing in for Anj. First off, congratulations, Dave.

David H. Lissy - Bright Horizons Family Solutions, Inc.: Thanks.

Unknown Speaker: I understand in the U.K., there's a plan to double free child care hours to 30 hours per week from 15 for parents that qualify. Can you talk about how that affects your business?

David H. Lissy - Bright Horizons Family Solutions, Inc.: Well, certainly, we're looking forward to that happening in the fall and have a plan in place to help those parents that we serve that do qualify under the income level. I will tell you that since we do the demographic that we serve in the London area tends to be – tends to sort of sway towards a higher income level than those who qualify so it won't have a holistic effect, but there's a definite potential for it to help us in a subset of our centers around England. Essentially, what it will do is provide currently as the U.K. subsidy is 15 hours and we obviously...

Elizabeth J. Boland - Bright Horizons Family Solutions, Inc.: Per week.

David H. Lissy - Bright Horizons Family Solutions, Inc.: ...per week, and we utilize that in our programs and have for a long time, this would obviously double that, and again, we look at it for those who are current users. It'll have the effect of helping them and without having an effect on us and the new users that we can get to sign up for more because this exists, obviously, that'll have a positive effect to the degree that happens.

Unknown Speaker: Okay. Great. And then, one more in the U.K., I've – there's been pretty heavy consolidation in the pre-school market over the last couple of years with you and one of your large competitors there. So, can you talk about what size and sort of opportunities still remain with the M&A market in the U.K.?

David H. Lissy - Bright Horizons Family Solutions, Inc.: Yeah. We feel good about the U.K. with respect to the amount of what I'll call regional or chainlets or smaller operators that still exist that provide reasonably good quality programs that we feel like would be fit. So, we have an M&A team located in London that has a pipeline, as I commented on before, and feel like although there may – there's still some, I wouldn't say as big as Asquith but there's still some larger opportunities in the future. Many of them are the regional chainlets in the 3 to 20-ish center size that exist over there and feel good that for the next couple of years, we'll be able to execute on them.

Unknown Speaker: Great. Thank you.

Elizabeth J. Boland - Bright Horizons Family Solutions, Inc.: Thanks.

Operator: Our next question is from Jeff Silber from BMO Capital Markets. Please go ahead.

Henry Sou Chien - BMO Capital Markets (United States): Hey, guys. It's Henry Chien calling for Jeff.

David H. Lissy - Bright Horizons Family Solutions, Inc.: Hey, Henry.

Elizabeth J. Boland - Bright Horizons Family Solutions, Inc.: Hi, Henry.

Henry Sou Chien - BMO Capital Markets (United States): Hey, guys. So, question on the organic growth. It looks like the past few quarters, we're seeing somewhat of an acceleration or uptick. I was wondering if you could talk a little bit more about what's driving that, if there's anything different this quarter or last quarter and just curious on how you're thinking about this level of growth rate at this point of the cycle and whether this is a normal kind of acceleration that you're expecting?

Elizabeth J. Boland - Bright Horizons Family Solutions, Inc.: Well, certainly, a little bit of a factor there is the back-up growth rate and ed advisory are a little bit higher this quarter, as the size of those segments can – relatively smaller movements can move that percentage a bit but it's still as up as a cohort, some in the second quarter compared to the first quarter, so that's a driver. But full-service continues to stay consistently strong in that 5.25 or so percent range. I think our view of this has been a steady growth engine with both the rate increases and just steady enrollment coming both recovering in our mature centers, and then, also, in the ramping classes. And so, I think that it's what we're pleased about is the consistency of it with slight positive momentum but it's primarily, I think, back-up and ed advisory in the quarter.

Henry Sou Chien - BMO Capital Markets (United States): Got it. Okay. And as a follow-up, in terms of how you're thinking about acquisitions, is there any update on what kind of markets you're looking at in particular or any sort of color there in terms of planning? Thanks.

David H. Lissy - Bright Horizons Family Solutions, Inc.: Yeah. Henry, our pipeline for acquisitions remains filled with and focused on same kinds of things we've been talking about for the past several years, which is our combination of slightly larger opportunities that sort of take a longer time to happen and kind of when the stars line up. Hopefully, every once in a while, every period of time, once in a while, we can get some of those to happen. But the bulk of what we'll execute on a more consistent basis are the smaller single-site to 10-site kind of operators both here in the U.S., the U.K. and the Netherlands. In those three markets, we're very active. And as I said, we just executed – we just closed one this past quarter in the Netherlands that we been working on for a while and the team over there is active in doing some good things. And so, in all three of those countries, we've got a good pipeline and we're always sort of, longer term, having discussions about where else in the world we might add value but there's nothing in the short term to talk about there. It's just more we want to be mindful of a set of countries around the world where we think there's possibilities for us long term and keep relationships going in those countries and we do that on a regular basis as well.

Henry Sou Chien - BMO Capital Markets (United States): Got it. Okay. That's great. Thank you for the color. And just one last one. I'm sorry if I missed this but did you give out the number of centers that you added in the quarter, added and closed?

Elizabeth J. Boland - Bright Horizons Family Solutions, Inc.: We added a total of 13 in the quarter.

Henry Sou Chien - BMO Capital Markets (United States): Got it. Okay. Thanks a lot.

Elizabeth J. Boland - Bright Horizons Family Solutions, Inc.: And closed seven.

Henry Sou Chien - BMO Capital Markets (United States): Oh, sorry. 13 and closed?

Elizabeth J. Boland - Bright Horizons Family Solutions, Inc.: And we closed seven.

Henry Sou Chien - BMO Capital Markets (United States): Thanks, guys.

Elizabeth J. Boland - Bright Horizons Family Solutions, Inc.: Okay.

David H. Lissy - Bright Horizons Family Solutions, Inc.: Okay. Matt, I think that's – that looks like that's the end of the Q&A. And just wanted to thank everybody for your participation on the call today. Hope everybody's having a good summer and I'm sure we'll see many of you on the road in the coming weeks and months. Take care.

Elizabeth J. Boland - Bright Horizons Family Solutions, Inc.: Have a good night.

David H. Lissy - Bright Horizons Family Solutions, Inc.: Bye.

Operator: Thank you, everyone. The conference has concluded. You may disconnect your lines at this time. Again, thank you for your participation.