GMR Solutions Inc. (GMRS) Earnings Call Transcript

Hello everyone, thank you for joining us and welcome to GMR Solutions' Q2 2026 earnings call. After today's prepared remarks, we will host a question-and-answer session. [Operator Instructions] I would now like to turn the conference over to [ Krister Sorensen ], Vice President of Investor Relations. [ Krister ], please go ahead.

Good morning and welcome to the GMR Solutions Q2 2026 Earnings Conference Call. Joining me today are Nick Loporcaro, our Board Chair and CEO; Ted Van Horne, our President and COO; and Brian Tierney, our Executive Vice President and CFO. Before we begin, note that during this call, we may make forward-looking statements, and actual results may differ materially from those statements because of various risks and uncertainties, including those described in our most recent earnings report posted on our investor relations website and in the risk factors section in our IPO prospectus. Today's remarks also include certain non-GAAP financial measures, including adjusted EBITDA, in our earnings release and earnings presentation that is available on our website at investors.globalmedicalresponse.com. Unless otherwise noted, references to the quarter will be for the second quarter of 2026. I will now turn the call over to Nick.

Thanks, [ Krister ], and thank you all for joining us today. We are excited to report strong financial and operational results in the second quarter of 2026 that are in line with our expectations. We provide a high-level overview of the quarter. GMR completed nearly 1.4 million patient encounters during the second quarter. We provided ground medical services to over 1.3 million patients, which includes more than 1 million transports, along with 29,000 calls to our 911 Nurse Navigation offering. And the remaining approximately 280,000 ground patient encounters consisted of interventions on scene that did not result in a transport. During the quarter, we provided air medical services to over 36,000 patients. Q2 revenue was $1.49 billion, which represents 3.3% year-over-year growth. Adjusted EBITDA of $285 million decreased 11.8% year-over-year, with an adjusted EBITDA margin of 19.1%. As mentioned previously, prior year results benefited from favorable revenue estimate adjustments associated with the No Surprises Act-related collections on claims from earlier dates of service. Aside from this comparability impact, you will see that the business delivered strong underlying revenue and operating performance during the quarter that Brian will expand on later in the call. Our strong performance was driven by continued same-market revenue growth, revenue from cross-selling and new markets, disciplined cost management, continued optimization of our clinical and operational platforms, and an unwavering focus on service to our communities by keeping care at the center of what we do. Today marks our second earnings call since the successful completion of our IPO 3 months ago, which was an incredible accomplishment that could not have been possible without the dedication of our frontline and support staff as we refocused our energy on our core competency of emergency care over the past few years. Before Ted and Brian discuss the quarter in more detail, I want to step back and reiterate why we believe GMR is best positioned as a front of the frontline healthcare provider. As the largest provider of emergency medical services, we serve 5.5 million patients annually, covering markets that represent over 60% of the U.S. population with 1 or more of our solutions. Our more than 24,000 highly trained clinicians and fleet of ambulances and aircraft are rapidly deployed to navigate and provide essential out-of-hospital care for patients when they need us most. Our model is differentiated because it is integrated. We bring together clinical capabilities through air, ground, technology, and care navigation assets in a way that allows us to serve communities, health systems, payers, federal and state agencies, and patients across a broad range of settings. In addition to emergent care, we provide non-emergent care, medical response, and disaster response. We have also maintained a long-standing role as the prime EMS contractor for FEMA, supporting national emergency and disaster response needs. The opportunity in front of us is built around 4 ideas. Saving and serving lives through clinical excellence. Second, growth across existing and new markets. Third, differentiation through our integrated platform and innovative solutions. And fourth, maintaining sustainable margins through disciplined, operating execution. We operate within a $35 billion total addressable market that includes private providers like us, municipal-run EMS systems, and volunteer programs. The U.S. population is growing as well as aging, and chronic disease prevalence continues to rise. Many rural healthcare facilities face closure or a reduction in service capabilities. All of this drives an increase in demand for EMS. As the primary provider and connection point to healthcare facilities and the only nationally integrated air and ground ambulance provider across 46 states and Washington, D.C., we believe GMR is best positioned to capture this demand. This positioning gives us a greater access to growth through adjacent markets, cross-selling within existing markets, and through disciplined M&A. And we never stop scrutinizing our existing business to ensure we continue to grow and provide sustainable care to our communities. As the national leader of EMS, this puts us in an exceptional position to be the innovators of the practice and raise the tide for the entire industry. At GMR, we have several systems and solutions, including 911 Nurse Navigation, our Concierge platform, and our online ordering system, Transport.net, that enhance efficiencies across our organization, resulting in the most appropriate care for patients. Our 911 Nurse Navigation connects lower callers with skilled nurses who can guide them to more appropriate sites of care when an ambulance transport is not clinically necessary. Concierge helps health systems better coordinate discharge and non-emergent transport needs, improve hospital throughput, and create a clear reimbursement framework. Transport.net reduces the effort in requesting, tracking, and dispatching both air and ground ambulance resources. Together, these solutions strengthen our offering, improve resource utilization, enhance patient outcomes, and create a reinforcing flywheel. Our national scale creates clinical data, that data informs innovation, our tools support contract wins, and those wins further reinforce our national scale. Each of these innovations help take the friction out of a traditionally run EMS system and ultimately provide better patient care, more efficient operations, and better hospital throughput while delivering savings to payers in turn. Our scale also enables a large EMS database, currently over 80 million records, that allows us to pair with hospital outcome data to drive system improvements and protocols. This data-driven effort resulted in GMR receiving ESO's Best Use of EMS Data to Improve Outcomes Award at ESO's WAVE Conference in April this year, which is a national gathering for fire, EMS, and hospital professionals. Our performance continues to be driven by the same key ideas. First, saving and serving lives through clinical excellence. Our advanced clinical protocols and rigorous training standards remain the foundation of everything we do, ensuring the highest quality of care in every patient encounter. Second, on growth, we continue to expand in existing markets, enter adjacent and new markets, cross-sell our solutions, and evaluate disciplined M&A opportunities. Third, on differentiation, our integrated air and ground model, supported by innovative technology, allows us to reduce friction in traditional EMS systems and deliver care more efficiently. Fourth, on margins, we continue to scrutinize the markets and contracts in which we operate, emphasizing work that is strategically aligned and economically sustainable. On the reimbursement front, we applaud the recent introduction of the Reimbursing Emergency Services for Critical Urgent Events or RESCUE Act of 2026 in the U.S. House of Representatives. This bipartisan legislation provides a necessary solution to modernize the Medicare payment structure so emergency medical services are treated similarly to other healthcare providers with payments based on real cost data. Under this approach, Medicare's payment rates will be more transparent, financially responsible, and cost-based, helping to close the financial gap between reimbursement and the cost of services for EMS providers. Achieving this milestone is another example of the recognition we are garnering with lawmakers and the payer community with respect to the necessary services we provide. Ted will now provide more detail on how our initiatives are unfolding operationally. I will now turn it over to Brian, who will provide more detail on the financials.

Thanks, Nick. GMR's operational focus remains clear. Grow our core emergent services, participate in non-emergent services where they make fiscal and strategic sense, and realize efficiency through innovative offerings such as 911 Nurse Navigation, Concierge, and Transport.net. These capabilities give us ways to pair clinical care with better operational decision-making and stronger partnerships across communities and health systems. These reflect a broader principle behind our model. We coordinate care across modalities and geographies as an integrated service. Rather than providing services on a standalone basis, even patients rarely fit neatly into a single mode of care. Care coordination allows us to better match resources to acuity, improve visibility for our partners, and support more efficient operations. In weather-constrained air markets, for example, the ability to deploy clinical resources across the ground platform reflects the practical value of integration. 911 Nurse Navigation continues to be 1 of our most important examples of innovation in the EMS model. The program connects lower-acuity 911 callers with skilled nurses who can assess the patient's needs and guide them to appropriate care setting or transport modality. This is better for patients, better for crews, better for hospital systems facing emergency department overcrowding, a lower-cost option for payers, and better for communities seeking a more sustainable EMS model. In the second quarter, we navigated nearly 29,000 calls through this program, up 50% year-over-year. In the quarter, we started servicing 3 new communities representing 1.3 million covered lives, bringing our total to 29 communities representing 19.7 million covered lives. And we plan to implement 4 more communities over the remainder of the year. We've seen up to 20% of 911 medical calls diverted to nurse navigation with qualitative benefits, including better alignment of resources to acuity, improved resource utilization, client stickiness, and higher satisfaction for both patients and crews. For example, during the Spokane wildfires, GMR's 911 Nurse Navigation Program quickly partnered with local emergency response and healthcare teams to connect displaced residents with appropriate care. Within hours, nurse navigators were helping patients access urgent care, telehealth, and community resources, reducing unnecessary emergency department visits while ensuring timely support. This effort demonstrates how 911 Nurse Navigation can rapidly adapt during crisis to improve patient access and support healthcare system capacity. We expect to continue expanding 911 Nurse Navigation in existing 911 markets and using the system as a differentiator in new municipal and health system partnerships. Concierge supports the non-emergent side of the model by partnering with health systems to coordinate appropriate transports under a clear reimbursement structure. This creates a more predictable framework for service that can otherwise be low reimbursing or operationally inefficient. It also supports hospital throughput by helping discharge processes move more efficiently and by reducing friction in scheduled transport workflows. Transport.net reduces friction in the process of requesting, tracking, and dispatching air and ground ambulance resources. Increasing visibility and simplifying handoffs among access points, health systems, and dispatch teams, the platform enhances the value of our integrated network. We are installed in nearly 3,000 public safety answering points, or PSAPs, across the country, representing over 65% of all PSAPs nationwide. This software reduces dispatch friction, improves visibility, and strengthens partner relationships. For example, in Fredericksburg, Texas, Gillespie County Dispatch serves both the police department and sheriff's office. This is a very busy system. They were an early adopter of the Transport.net ordering technology and now process 100% of their air transport requests through the platform. Thanks to its ease of use, reliability, and aircraft tracking capabilities, they save valuable minutes on every request, allowing them to focus on other emergencies instead of spending significant time on the phone. Turning to growth, we remain positive about our ability to win new business opportunities in core emergency medical services and expanded municipal ambulance contracting through 911 Nurse Navigation. Our growth strategy is multi-pronged: grow same-market revenue, expand in existing markets and enter new markets, cross-sell our integrated offering, and evaluate disciplined acquisitions where they are financially accretive and strategically aligned. Same-market revenue increased $53.1 million, or 3.8% year-over-year. Market revenue in the quarter was $21.3 million. For new market starts in the quarter, we opened 2 new 911 systems in markets where we already had air operations advancing our integrated market strategy. We also opened 3 new air bases, 2 adjacent to existing operations, expanding our footprint, and 1 in a new region with future growth potential. Also in the quarter, we executed new agreements totaling over $43 million in incremental annualized revenue. We continue engaging with states and other stakeholders on rural healthcare access and EMS models, including opportunities tied to state-led rural health transformation initiatives under the Rural Healthcare Transformation Fund with our 911 React platform. 911 React provides rural areas with the connection point to care that is desperately needed in these healthcare deserts. While we believe we are the best positioned to help solve rural health issues, we also believe we are the best to provide urban system rescue. Over the Fourth of July weekend, as part of our response capabilities, the State of New York requested 50 ambulances and 110 personnel for the City of New York to supplement the FDNY during what is typically the busiest weekend of the year for local EMS. GMR teams responded to over 2,200 emergency calls throughout all 5 boroughs. This short deployment is just another example of GMR's ability to be the safety net for EMS across the country. Under our event medical operations, we covered 7 of the 11 stadiums hosting FIFA World Cup games, as well as provided coverage for several of the team's practice facilities. We treated over 3,000 patients across the U.S., including about 300 transports and 1 full cardiac arrest resuscitation. I will now turn it over to Brian.

Thanks, Ted. In the second quarter of 2026, GMR reported net revenue of $1.49 billion, a 3.3% increase year-over-year. Compared to the same quarter in 2025, Q2 air volumes were up 6.9% due to strong request demand coupled with improved capture rate. Emergent ground transports increased 2.4% driven by strong same-store demand, while non-emergent ground transports decreased 3.0%, reflecting our deliberate strategy of redirecting our resources towards higher acuity responses. As a result, during the quarter, total patient encounters associated with our focus areas of emergent transports and nurse navigation grew 3.7%, while lower reimbursement patient encounters associated with non-emergent wheelchair and non-transports decreased. On margin, our operating discipline remains centered on contract profitability, labor productivity, resource utilization, rate adequacy, and operational efficiency. Following the strategic review process that began in 2022, we have continued to focus the portfolio on core operations and better-performing services, including reviewing, renegotiating, and, where appropriate, exiting contracts that did not meet the return thresholds or strategic requirements. We also continue to benefit from efficiency initiatives in billing, collections, staffing, fleet utilization, and shared services. Long-term, we believe margin sustainability will be supported by integrated operations, payer relationships, disciplined contract structures, and continued refinement of the independent dispute resolution and other reimbursement processes. Net transport revenue per ambulance transport, or NRT, increased 1.4% compared to the prior year quarter. Revenue performance was driven by a positive mix shift from non-emergent to emergent transports and strong underlying NRT improvement on a like-for-like basis. This was partially offset by an approximate $16 million payer mix shift impact from the expiration of the Affordable Care Act exchange subsidies as patients shifted out of commercial insurance and into self-pay, which was in line with our expectations and was included in our prior guidance. Additionally, the current quarter did not benefit from the same level of favorable changes in revenue estimates recognized in the prior year period, which were largely associated with collections on No Surprises Act claims from earlier dates of service. During the second quarter, changes in estimates predominantly related to No Surprises Act claims were approximately $74 million lower than the prior year period. This creates a meaningful variance in the year-over-year comparison in net revenue per transport, total revenue, and adjusted EBITDA, which was $284.5 million, down 11.8% from the prior year. Aside from this comparability impact, the business continued to demonstrate strong underlying revenue and operating performance during the quarter. Turning to expenses, total operating expense increased 19.4% to $1.43 billion in the quarter compared to $1.20 billion for the same period in 2025. Employee wages, benefits, and taxes increased by 24.5% to $925 million. The increase year-over-year was primarily driven by increased stock compensation expense of $129.6 million related to the vesting of stock units associated with the execution of the IPO. The remaining increase was primarily driven by improved staffing and normal wage adjustments to attract and retain talent. The average base unit wage increase during the quarter was 3.3%. Maintenance, fuel, and other direct expenses increased by 21.1% to $136.4 million. The increase was primarily driven by fuel unit costs associated with the Iran conflict and the timing of aircraft maintenance events. We also saw higher-than-normal inflationary costs impact lines that have a direct correlation with the suppliers' underlying fuel costs, including travel and shipping costs. Other operating expenses were generally in line with expectations. As reported, we recognized a net loss of $28.3 million in the quarter compared to net income of $80.8 million in the prior year period. The year-over-year change was primarily driven by $142.3 million of expenses associated with our IPO, as well as the lowered changes in estimates already mentioned related to No Surprises Act claims on older dates of service. Shifting to CapEx, cash flows, and liquidity. Cash used for CapEx and aircraft financing was 6.3% of revenue for the second quarter of 2026, compared to 4.5% of revenue for the second quarter of 2025. The increase was primarily due to the timing of CapEx purchases in both years, as well as our decision to pull forward certain purchases that were planned for later in the year to capture available price discounts. GMR finished the second quarter with $420.0 million in cash and cash equivalents, and undrawn ABL with $696 million of cash borrowing capacity after letters of credit. Our free cash flow was approximately $15 million. Net leverage finished the quarter at 3.5x, down from 4.3x at the end of 2Q last year. We expect strong cash flows to drive this below 3.3x by year-end and have line of sight to 3.0x before the end of the year in 2027. Shortly after the IPO, Moody's and S&P upgraded our credit ratings from B2 to B1, and B to B+, respectively, triggering a 25-basis-point interest rate step down on our term loan facility. Moving on to guidance, we are reiterating our full year earnings guidance. We continue to expect revenue in the range of $5.89 billion to $6.18 billion. Our adjusted EBITDA in the range of $1.135 billion to $1.195 billion and total cash used for CapEx and aircraft financing between 5.1% and 5.3% of total revenue. Our guidance assumes continued momentum in transport rates and volumes, a stable payer mix that already reflects the elimination of the ACA exchange subsidies, and the ongoing impact of the prolonged Iran conflict. We had strong demand for and grew our core emergent services. We collected more for those services. Unit wage costs were moderate. We have ample liquidity enabling further deleveraging. And now I will turn it over to the operator to open for any questions.

We will now begin the question-and-answer session. [Operator Instructions] Your first question comes from the line of Scott Fidel with Goldman Sachs. Please go ahead.

First question, just was hoping to get maybe a little bit more context to the extent you can provide it just around the IDR dynamics and appreciate the flagging the year-over-year change. Maybe if you could just sort of push that maybe in the context of sort of more of like year-to-date and the first quarter, did you have, I don't recall similar dynamics, but it seems like that was more of a meaningful number in the second quarter of last year. And I think you mentioned having maybe some sort of prior year sort of sweeps and collecting some of those funds and just maybe more broadly just talk about the trends with IDR in terms of how basically the revenues that you're generating from that to the extent you can have been trending year-to-date.

Hey Scott, thank you. This is Brian. Yes, last year in the second quarter we had about $79 million worth of change in estimate related to the No Surprises Act stuff. This year was about 5. So that drives that $74 million delta. What that really says is, we've been able to really dial in the estimates. This is all related, the stuff in '25 is really related to stuff much earlier. So feel really good about where our ability to predict the revenue here. Now there's still some older stuff hanging out there. We will continue to try to go get that really old stuff, but feel that, you know, we're going to be more in this 0 plus or minus 5 range here as we go forward.

Okay, got it. And then just for my follow-up question, maybe if you could walk us through just the payer mix dynamics in terms of fully bridging to the year-over-year changes and certainly heard the call out around the impact on the exchanges and would imagine that that certainly had a meaningful amount of it. So should we think about the sort of the lower commercial payer mix year-over-year being largely a function of both the impact from the lower exchange revenue and then combined with the lower IDR revenues that you already recognize, would that largely comprise it? Or just curious if there's anything else that we should be aware of? And then how you're thinking about, you know, payer mix sort of trends within your guidance into the back half of the year. Thanks.

Hey Scott, it's Nick. Let me tackle a higher level and then Brian can get in a little more granular. So, you know, when we had our last call, we had said we saw little, if any, impact first quarter. We started seeing some impact in the second quarter in the ACA and I recall mentioning we'd seen that in our own benefits, we had more employees taking on our employer benefit plan. We suspected there that these were folks that were on the exchanges looking for other alternatives. I also mentioned, you know, whether you're on the Gold Plan or the Bronze Plan doesn't make a difference for our types of interventions that we get paid. So we did see some impact in second quarter that Brian can expand on and mention obviously in our call here. So, you know, thinking we still need to better understand it. Where are these folks? Are they all going to self-pay? Are they all going to different commercial? And we're seeing evidence of that. The other key thing we're learning, and I think it showed up, at least in what I've read on some of the hospital readouts recently, geographically, it's different as well. We have parts of the country where, yes, we'll see more go to self-pay. Other parts of the country that we're finding them now in commercial plans, which is actually an upside for us. So still, you know, thinking about all of this, studying it, learning more and anticipate we'll learn more even this quarter. We'll hand it over to Brian to get a little more granular and tackle some of the numbers around your question.

Yes, but it's the short answer. Your question is yes, it's the exchange impact and the No Surprises Act year-over-year comp that really drive the payer mix shift. To expand a little bit more on what Nick said, we're seeing it exactly where we thought we would see it. It's the big exchange providers, the Molinas, the Centenes, few of the bigger Blues that are in the exchange programs. We've seen the decrease in their volumes in the states that they were heavy in. And so it's really, since April, we've seen a very consistent mix shift relative to what we had expected. And so that we've got that in our guidance as we go forward. We had it in our guidance before, it's still in our guidance.

You know, for we'll keep said, we're going to make sure everybody ultimately land consistent here across the common aid make here, you teams as we figure out that we do have some levers to back to the counties. We programs. We can reopen up some of those contracts on pricing. So there are some levers. We haven't flipped them yet because we want to better understand where the impact is.

Your next question comes from the line of Elizabeth Anderson with Evercore ISI. Please go ahead.

I have lots of conceptual questions and maybe 1 numbers cleanup question. If you talk about the improved capture rate as 1 of the nice improvements in the quarter, can you talk a little bit more about that? I know obviously the weather is better in the second quarter than the first quarter, but is that sort of what you're referring to, or is there something more underlying than that that also helped improve the capture rate?

Elizabeth and I'll have Ted expand on this. This is Nick. You know, there's a lot of levers here that we're looking at. Some of it's technology, some of it's, you know, recruiting of pilots and medical staff, making sure we have people in the right places, studying trends. You heard Ted mentioned Transport.net and how that drives 1, making sure we understand the demand, where it is, and that we're readily available to capture it. Obviously, weather and even with weather, we've talked about further investments in IFR, which, you know, mitigate some of the weather impacts. But I'll ask Ted to maybe provide a little bit more color around this and the initiatives we're having on the air side.

Yes, and that quarter specific in Q2, the way the weather was impacting the good parts, different parts of geographies for us too. So where we see higher capture rates in certain parts of America, and that's where we're seeing a lot of the weather improvements and we saw the capture rates improve with that also. That was a big chunk of the reason why. And we are going to continue to make all the improvements and investments, this IFR, different types of aircraft. We've been bringing them in from 1 of the vendors specifically at a pretty good click right now. So we're excited about that. We do see the results every time we bring in the IFR aircraft.

Great. And my number is a cleanup question, just to make sure that we're modeling your go-forward correctly. One, I heard you say sort of a continuation of high oil price expectations. Is it currently sort of that current rates continue for the rest of the year? So that's the first part of it. And then secondly, obviously the World Cup doesn't happen every year. So the specific World Cup part of the revenue, just to make sure that we're not, you know, comping you off of it for next year.

I'll take the second part first. The World Cup was a couple of million dollars, a very low revenue piece, you know, and not all of that flows through to earnings. So it's a very, very small piece. The oil prices on a go-forward basis, we use the forward curve. The average for the rest of the year is about $80 a barrel, a little bit higher in August and September, a little bit lower in November. I think the market is assuming at least for the rest of the year, there's continued Iran conflict with potential for, you know, a little bit relief at the end. We've baked that in going forward. That's $10-plus million a quarter of incremental fuel relative to what we had initially. Initially we would have done if we were setting a budget or something before the year began. All of that's baked in.

Your next question comes from the line of Benjamin Rossi with JP Morgan. Please go ahead.

Just as a follow-up on the IDR comments, by my math during the first half of the year, you've left about $110 million in out-of-period benefits from IDR last year. When we think about the back half of the year, if you were to receive no IDR benefits during 3Q and 4Q, what would this out-of-period comp dynamic look like? Is it fair to think of this step down during the second and a half of the year being similar in magnitude as the first half? Just curious on what that contribution looked like last year during the second half compared to the first half.

Yes, thanks, Ben. Yes, the number is about the same. It's just under $100 million was in that second half of the year last year.

Got it. Okay. I guess just as a follow-up question, the press release, you mentioned some new business wins. Can you just elaborate on those opportunities and how you're thinking about potential contributions from these wins in the back half of the year? Thanks.

We don't get into specifics per contract, but overall the 911 wins both on the ground and air adjacent markets. I think as I mentioned where we had opportunities and air bases and expanding footprint for us when we can operationalize the next town over, the next county over, we get such great operational synergies with it. And then when we link in our transportation, we're actually building in more aircraft into that web for the 911 centers as they're using it. So that's been a big piece of the Q2 on the air side. The ground side was 2 new 911 wins in New Castle, communities that we already had the air. So it was great that we were able to bring in the ground operations, create that integrated market. So those were in the southeast and they're excited because that's we see a lot of that opportunity continue for the rest of the year these small mid-sized communities across the U.S.

Great. Thanks for the additional details.

Your next question comes from the line of AJ Rice with UBS. Please go ahead.

First, maybe just to pursue a little more on your roll out of your 911 Nurse Navigation. How much of your footprint does that address today? And is there an ultimate target of how much of your footprint you can get to and what limiting factor on rolling that out is?

AJ, it's Nick. Again, I'll start at a high level and ask Ted to offer up some more details if I miss anything here. So, you know, we're probably 29 communities today of coverage representing just shy of 20 million covered lives. And I think you'll recall, and we talked about in our presentations, we have approximately 200 million lives in the geographies that we serve. So that's the potential. I think as the CEO and pushing the team, as you look at our sort of a 5-year plan, could we potentially get the 100 million covered lives? I think that's realistic. I think we have plans in place. Now, what does that mean for the impact of the business? You know, you've all challenged us before on what is NurseNav and its worth. It allows us to run our business better. It allows us to win more business because of the value. And just real interesting, actually, in a session we had yesterday, we have evidence of where we put in NurseNav, and Brian can speak to the numbers here, on 150-basis-point lift on just margin improvement in the markets we put it in. But what's even more interesting, what we're learning, when we have nurse navigation combined with like a treat, no transport, we're actually making better reimbursement on that versus a basic life support transport. And that's the dynamic that's important. And the reason you'll continue to talk about NurseNav, the push of it and the proliferation and how it positions us in the markets where we're deploying. Ted, I don't know if you'd offer up any other detail on that.

For us, the NurseNav really is 3 distinct growth channels. One is our existing footprint, which you mentioned, and we can continue to spread that out in multiple ways over the course of each year. You know, we're going to keep growing those out. The second channel is the Rural Health Transformation Fund and the new bids there as we're proposing that across the U.S. And the third channel is the big Metro models, right? We're working the nurse navigation in with the very large municipal city bids. Those take a little bit longer on the sales cycle, obviously, because they're very big municipalities, but when we have a great, sales team is working very closely with each 1 of those cities as they walk through that, you know, those proposals. So, you know, that's how we see those 3 distinct cycles. Each 1 has got a lot of room in it and we're excited because we've just opened up the second center in Phoenix. So we've got a lot of capacity and room to grow. We've thought Phoenix, both Phoenix and here in the Dallas area, being able to get the nurses. And so we continue to grow that, the actual nurses taking the call. So we're ready for it on the technology side, space side, and continue to grow it.

Okay, thanks. Maybe the follow-up. You mentioned on the prepared remarks, you'd be at 3.3x leverage by the end of the year, 3.0x by the end of next year. Is sort of 3.0x a steady state that you're comfortable with? And then if it is, it sounds like there are some potential deals out there. Can you categorize what you're seeing, what kind of things you might be interested in doing, and how – what kind of valuations are they going to be potentially immediately accretive to you if you can do some things?

So AJ, I'm going to start backwards with your question. We had hoped and anticipated post the IPO, we would have some arbitrage opportunities. Admittedly, with where we're trading and where the market is evaluating things, I think that's created a bit of conservatism around the pipeline. We do have a healthy pipeline. We've probably got about 15 targets from some small mid-size to some larges. And ultimately, and I lean on Brian and the team here on, how do we best leverage our capital? To go now to the front end of your question, are we better focusing on de-levering for the time being? We're going to be, you know, we're going to scrutinize the M&A opportunities. There's a couple of opportunities in adjacent markets where we have to ask ourselves the question, can we just win the business? Is it quicker to buy it? You know, we've mentioned to you guys in the past, we're going to look at a market that has strong ground presence. Do we buy an air asset there? So that's how we're looking at it. I think, as you said in the prepared remarks, you know, this is a conversation Brian and I and the teams have often is where are the opportunities now? Are we, we constantly look at our current rates, is de-levering combined with some of that in our best interest? So there'll be more news coming along those lines in probably pretty short order.