Circor International (CIR) 29 May 202020 Q1 Earnings call transcript

Greetings. Welcome to CIRCOR International's First Quarter 2020 Earnings Conference Call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. [Operator Instructions] I will now turn the conference over to your host, Scott Solomon, Senior Vice President for Sharon Merrill Associates. you. Thank

begin. may You

good and morning, you, everyone. Thank

Today's available call CEO; and the The we'll today today on at Chief is and President slides are expectations. unknown Presentation X. These factors. subject known to of and referring expectations CIRCOR's Buckhout, uncertainties, to be Section CIRCOR's statements and Abhi forward-looking & Investors link. the Officer. are website contains Webcast turn www.circor.com Scott Financial On on Khandelwal, company's the that risks, other Please the Slide discussion identify future to

those these as full discussion other remarks. today's the a of filings to differ only website For statements anticipated you forward-looking The Actual XXXX. Any from review filings. Form of are the today, or and factors, XX-Qs, implied circor.com. company's company it's XX, view on could at XX-K, by advises May represent available company's CIRCOR's results SEC materially

update and to X. date, non-GAAP of are call Slide so. disclaims statements income, to may special forward-looking at free adjusted reconciliation certain choose CIRCOR adjusted today's I'll operating turn call, later organic On duty charges non-GAAP website. press to to any now release measures to earnings management and Scott. adjusted These will turn measures. The margins, the a the over metrics in CIRCOR's adjusted the the While exclude of measures cash GAAP EPS, tables Please comparable income, refer specifically operating recoveries. available these financial on CIRCOR's to company net the flow, do

offering impacted CIRCOR, to times. unprecedented let morning, by and well those at wishes Scott, everyone and COVID-XX. our good And prayers truly you, are Thank thoughts, These me begin by all from everyone.

employees, another rapidly At service for we the customers safe. gratitude want doing to keeping environment. our to our and battling facilities countries on and and CIRCOR this in and and CIRCOR one our majority We top lives. saving this team themselves serve, suppliers. their virus, and our They've entire also dedication safety operations to which frontlines remains of priority markets thank job caring customers health operate. I supporting for others the essential the in them they vast express deemed the the unwavering our in been our while of end around customers are changing the Because of a remarkable those those

All capacity. operational our normal except which and operating fully sites are France India, are less at of than

customers measures our while the employees Over possible last significant months, disruption. safe around as implemented supporting we've with our factory to keep world minimal as several the

to take poised continue it monitor to pandemic to if our the further and the We on focused to exit volatility, comes. our long-term strategy, CIRCOR flexibility remain and to while situation maintain positioning we're our We whether the peers. company the appropriate position steps financial outperform

QX discuss want nearly improving financial from we mission already to Abhi's of finance valuable global welcome Please in track has multinational we're of turn X. I performance Slide two industrial Abhi operations, proven addition to decades including our critical team. products, global benefiting highly our a a Before Abhi record complex expertise. and manufacturers experience companies makes to and organizations, our him for CFO. to Khandelwal new results, CIRCOR engineered managing of as his

were U.S. a a XX% timing down and large in end quarter organically, at coupled by on momentum. segment orders from solid orders X% a Europe down $XX the markets orders me the segment, strong compared strong in quarter In orders in Let of show and Aerospace down recap results orders quarter; to million and and received million, Defense continue the our driven organically level. industrial due difficult in to year of about QX XX% continued most Industrial manufacturing to our March, headwinds Defense $XXX ago. with higher United to were COVID-XX's the had due [ph] at We States. primarily orders impact compare, UK of Navy. we were

the million Virginia announced Class six to we contracts was week, for company the $XX valves totaling that provide awarded submarine. last Just

COVID-XX in However, largely in and was quarter and Overall, commercial the aerospace due of revenue from customers we in operating XXX share. saw last XXX%. and quarter, orders last this $XX delivered out were direct the delayed million The basis COVID-XX. was adjusted and book-to-bill earnings of per operations revenue of year, pushed shutdown of quarter points projects. XXX down X.X%, as down points basis Adjusted our from QX suppliers was quarter, quarter. impact to We of $XXX million margin significant $X.XX the

position receivable addition, COVID-XX, inevitable we recovery. the on CIRCOR COVID-XX. our wrote-off $X.XX. exacerbated maintain flexibility to customer by two reduced unusual to share and $X our taken steps the by due per capitalize These we've million by approximately to earnings uncertain caused financial to issues a financial In outlook prudent Due items

these cost strategic of of upto million. aggressive Some adding plan. an steps actions Many structural actions the acceleration represent of include $XX our taken

preserving including growth CapEx that continuing in management, aggressive inventory growth better around the spend initiatives. and reflects cash our management. capital current resources prioritization execute particular, focused more and tighter on working controls Focusing long-term more And to finally, on accounts receivable our of environment, and we're collections

platforms. have this After and oil sharpened valves gas, core businesses, this upstream communicated year. distributed XX expect important last was at uncertainty. strategic that part XX plan volatility intend last previous year, plan away control commodity we'll transformation We other An We our we portfolio new our complete, of position to this shift on on the products time finally, critical of execute to and This mission focus helped And through exit flow business QX. to our better from rationalization. divested continue commitment XX and up portfolio in completed of manage least summer. our and from has summer, launch is last our to CIRCOR

discuss the outlook markets. detail review I end over me our in turn of the our to let more quarter Now, to before Abhi results call first

Thank CIRCOR. in work with I'm first you, to today be the And you to coming everyone. all you It's good on all quarters. earnings here excited Scott. call morning, great with my with

asked to the at cost by the taken European AOI million mid-March margin project drop reviewing factories decline was have All onset lower had sales missing COVID-XX. in milestones, COVID-XX. for business the by key and lower margin where out is million quarter sales in important Let's declined the of operations. actions on refinery revenue X; growth due pressure X%, industrial reason our the industrial, this be to was impacted $X margin, by QX. significantly The million the which write-off COVID-XX Adjusting divestitures. with begin teams for pushed segment XX% sales for exclude service of on receivable which $XX aftermarket by primary of and segment $XX resulting driven for continuing receivable March, lower the Starting industrial in 'XX. was results. from March that the saw we million, Slide valves, than to pandemic. $X caused organically operations The suspend would XX% [ph] the through reflecting quarter the we mitigate Within figures were $XXX contribution of and volume, industrial a our impact of million in sales our driven QX refinery by of are versus the a suppliers down was closed organic of impact, in

Strike million, Turning programs. submarine, the defense Class sales to organically, the $XX Virginia had strong Fighter and Slide for driven Joint and X; aerospace of up by X% shipments

top business top manufacturing line. defense as margin Our evident continues quarter year. be and was and growth Aerospace defense operating by the the prior to growth, XXX XX.X%, pricing point in up the line driven strong, productivity. was in basis was This where versus

adjusted tax Turning rate and was the X; XX.X% foreign driven to tax by Slide for credits. R&D QX, differential higher rate tax

$XX of charges, we quarter. a special The in to of million segments impact charge total the Looking of recorded million. impairment component acquisition COVID-XX million industrial goodwill of related on charge at due non-cash restructuring the $XXX outlook. items is was $XX pre-tax amortization pre-tax largest the the our The of charge and

recorded to driven $X million, associated $X of again pension our the primarily income. business. sale for to prior Interest and balances. was expense with by we compared income lower debt Finally, down million of the higher gains foreign sampling $X due was Other $XX and million the million instrumentation quarter exchange

pay non-core was debt and a year-over-year at lower by was of net our driven primarily from $XXX the which down our million, sale the historical the Slide with end X; flow in in million operations QX, Turning cash seasonality of flow consistent At free with was $XXX than line with proceeds $XX of to assets. million cash various our decrease 'XX, negative $XXX trends. QX which debt is from and our of QX, million,

versus Turning X.X leverage QX end our X.X covenant to times. of of the bank EBITDA X; Slide was our at times

[ph] our QX the million covenant. repayments. debt at QX. at without below at mentioned, which at significantly would intent our the exit Scott end X.X is As leverage was valves is of the Pro end distributed debt QX business of with bank forma Cash-on-hand be [ph] BV times to the of end no $XXX near-term

XXXX. our revolver uncertainty. matures to Our in operate our confident very of December liquidity term standpoint, XXXX, due in loan From and in until feel these December we times not is ability a

caused QX or by provide guidance the Finally, will for wrap we to up; not to the financial uncertainty due COVID-XX. XXXX

give some our hand color will I Now, over to end and on Scott outlook. to it markets

Thank you, Abhi.

an some to provide the actions as I'll in as what our pandemic. we're seeing end overview of manage Now, through markets, the well of taking we're

eliminated will in results As our industrial we earnings discussed our and going report on aerospace so call, last two we've energy our forward, segments, group; defense. and

industrial business in our valves now is refinery reported Our group.

XX. this May Our turn XX. in on were new Please X-K structure reflecting restated to an released Page financials

me most revenue industrial is our industrial; QX, the is and and of industrial is defense level, in of general XX% Let in XX% our XX% is which XX% our is is to aerospace. defense, market and high group a At recapping gas, end XX% be likely oil downstream aerospace XX% start commercial QX. exposure. XX% expect segment; approximately which by down reported Approximately and to we and

X% defense the expect side XX%. in which XX% to be business, to down and down be to the XX% to driven aerospace is of commercial aggregate, For by we expected

down in we and Despite be and the wastewater. Slide activity manufacturing, in chemical increase base than levels the full to were and linked and in commercial won for and expected the in cancellations America orders Commercial Refineries lower decline a in delivered to well the a Marine, as Since In April. XX%. industrial of aftermarket. several offshore reduction recent in North QX, to to capital We cruise utilization. an ratio we shipyards the and the performance in Please about strong activity impacting we're impact X% turn in Early expect processing, Latin delays power is QX, at supply production market them aftermarket seeing generation X.XX. all markets. the late We're orders of lowest seeing of machinery [ph], Germany. as orders quote of marine valves, X% to the COVID-XX saw Refinery at refinery across We example, virtually in weak end and as business experiencing project up in book-to-bill our industrial low capital America end business we're QX, equipment year-over-year reduced U.S., ships COVID-XX large stronger QX XX. defense lower business start Europe. and activity market the manufacturing, in saw projects a the production of valve impacting from four-market vessels, levels industrial cut seeing onset slowly QX.

we for activity X be trend, delayed XX levels projects and As be capital months. to this proposals aftermarket high. capital projects many slowly, resume result, expect projects to continue a to and to Despite

For primary COVID-XX The industrial and end decline expect capital overall XX% most an driver of drive in impact the a in global in and orders OEM QX, across CapEx outbreak projects. to markets of is we between year-over-year delayed the reduction overall XX%.

On the COVID-related capacity operations. aftermarket disruption side, and short-term of lower orders utilization lower of customer the assets driven by are expected in

Fighter, is backlog defense despite Joint including in the market improvement the slow to to The the in aircraft orders in expected continues to expect in CVN-XX strong, gradual U.S., QX. China. the programs turn general Please we Virginia SM-X Strike carrier, of see driven Europe activity India; We XX. headwinds driving expect submarine, a be the up increases Navy in and Regionally, industrial and and This for down ramp commercial to aftermarket a ongoing is U.S. backlog strength Missile. defense be aerospace segment the Class in the by aerospace. recent Slide

Joint production Airbus. business. orders orders from spares on and by by expected aerospace due primarily defense down, Commercial primarily the orders [ph]. our $XX order of strong increase million our at quarter. to and and defense defense Fighter strength quarter QX The of program. were be quarter Boeing defense U.S. delivered $XX by was impact Our in aerospace the in to expect for million be quarter by segment business, in driven in Strike previous of the another driven but driven the defense sequentially a defense Naval will Commercial programs the strength to COVID-XX rates Overall, is aerospace we other offset orders defense down

down As expect we we orders look QX, year-over-year. into to be commercial

sides defense. the the and carryover the important half orders we is not a the of volatility. on note order growth maintain weighted future business we're increase single program With XXXX. majority the X% commercial both increases digit to increases year, the XXXX heavily turn CIRCOR expect prudent It's we from this to and to flexibility defense, timing The prices new to across year. in Please withstand pricing of aerospace but For aftermarket. expect business, and taken financial the defense Slide in large that see on clear, price increasing back side the net position steps our to XX. in We've of of of

complete gas. we're focused we and as and driving COVID-XX associated and will of capital make on absorb I actions, Some out which the of XX. million flow collections accounts sure point Despite steps management, aggressive depressed inventory transformation current include expenses, of with the out wanted be still cash strategic $XX initiated, reflecting cost out upstream working in structural, Please transformation of turn CapEx disbursements million finalizing to last oil of receivable prioritization are these actions summer. spend and Slide environment, that management. the $XX very we CIRCOR's we particular, despite QX these QX restructuring laid and to

end While the company. and responded the of respect a cost has the pandemic markets, accelerating had we've particularly with on out aspects plan, significant our many structural reducing leaning by impact to expanding and

prices nature critical on environment the To to team to XX, despite And progress entire a dedication know finally, an unwavering growth CIRCOR make the As of original raise than by taking been plan. the up our strategic important significantly for COVID-XX. our slide, structural our this company again the customers. commitment service able last was disruption noted of cost market to It products, by caused mission of the of of our job. we're to also of commitment like last remarkable line Due the to we've been XX with products increased in that thanking this in their year They've the reduction once is out doing previous million summarize, larger we're in we're year. the in $XX plan capacity XXXX; structural taking the I'd preserving XXXX cost. part appropriate this from original and and steps new our close continuing plan, We've the remains despite larger current important to in playbook. commitment, XX year. to navigate launched to our while price

the and the market continues remain we'll accordingly. adapt strong to deleveraging As generating committed expanding and respond positioning flow change, margins, growth, the company. free continue company to cash for to long-term We

happy Now, to questions. Abhi your be and will take I

is question first from Andy Citi. [Operator Please you. Our Instructions] with Thank proceed. Kaplowitz

on behalf Andy. Good of morning, This taking is the guys. Piyush [ph] questions. for Thanks

Good you? How Piyush. are hello, Yes, morning.

I'm good. Welcome, Abhi.

are you. Thank How Piyush. morning, Good you?

next how as Maybe about the savings provided in think revenue few over So, two the kick your or color margins segments outlook. cost the quarters on should you some in? QX, elaborate on good we guys QX decrementals

the think for don't and about way to about gross to normally, that be out cost by the CIRCOR certainly very we've historically decrementals would that the think decrementals I you are; the offset here, announced. see I same, would really close think at/or So, our margin. decrementals the take changes

about it. right the to way that's think probably I think So,

drop XX%, offset takeout at the So when then in you that the it I'd cost with that think announced. we've about aggregate revenue, take

the you. components have maybe some be in OE on could May two already you your into across [ph] and you would segments? And both And months well? in This as these two color provide April about Got seen we talk if months trends helpful. quarter, the are versus aftermarket

Sure.

with start So, -- let's start we'll industrial. with

The two and May are Page remarks. and the out prepared consistent QX on I'm But XX% XX aftermarket the our of we're so is in April still uncertainty on laid range; this terms the -- are quarter, industrial, is last levels, far first prepared coming months know, a Page a around the we in down we're in both remarks. down OE coming So, roughly at which of quarter. there you for of which sorry, -- similar of with of of magnitude, of quarter. end month the better five-week so in what is -- the XX lot as in the into

are it's that's we'll we by the saw at us of the about aerospace like million quite largely With a defense. defense, the weeks far ago and to driven higher May. heard it couple certainly strong, in press you too So, talk orders and be so range defense; probably release early that but what got of and April end to order probably say looks respect $XX the through

the to pump up the in orders going So aerospace the significantly and second that's pretty defense side. quarter on

and were I be down in, X% aggregate, we XX%. revenue, in mentioned, expected. to looking of as revenue in terms In between coming we're

in a and defense in prior terms X% it's versus year. so for QX; that's us, and of down pretty aerospace XX% between number think good I for expectation

have other significantly see, we that's small and aftermarket's business; what far on page down but As well. as as over Page are Airbus relatively in down as as in it's our XX%, what of a commercial here aerospace, line Boeing as coming with OE, can piece being we're showing down in on in the and platforms consistent you with aftermarket XX; well

right the given defense see quarter, running but we're on business; the we programs remainder in the of may range revenue stated And aggregate, the that or defense the call, XX% in year. we on I'd any we're shipments, and growth between say in we side, so in less is top on more now platforms line see On seeing down. for here; list growth QX strong through lumpy expect the quite digit the these good you depending side in the on aftermarket of to single that growth on X%

lastly, talk Got how out you. different like And about run? talk investments seeing these investments segment; maybe benefiting and you And now in was play industrial have out so you're about far? particularly about guys weak they the the geographies India played what pre-COVID. and China Thanks. how mentioned in there maybe the Europe longer

Sure.

U.S. So, Europe the I'd in we've and two the very that say seen behaving months last similarly.

significantly are normal were of here. was as in ramping their down we on the as And we month a a that both about least and business, operating India the mix capacity. a shut were base, factories below up XX% as but or now, well side. factories asked They the still is to supply India. sides the the where we're side, lockdown, again So are probably as at shut more, so in the the well you aftermarket shift India they took on well our in severe short-term range don't both country for only as both big OE know, expect talking down

is So down in QX. going here be India we're significantly expecting to

does -- QX. growth. business, to a down contribute of huge contributes in Asia, Now, it's normally our the not In it but it part significantly

and certainly and recovery a but saw huge is growth seeing slow, CIRCOR we than it sequential in is contributing. part a it in are not mainly; seeing it's QX we in but are what helping Again, better China. We of China, it is

All guys. get Thank right, I'll you, back the into queue.

Okay. Thank you.

Our proceed. KeyBanc Markets. Jeff Hammond, next from question Capital Please is

guys. Hey, good morning,

doing? Good morning, Jeff. you're How

well. doing Good,

or delayed write-off segments? the that just impacted you? in have comes revenue If framework? within the where would -- when this and where about talk you back hit talk the about And could And that now

Sure.

weeks that our position; a COVID-XX was QX customer into write-off financial coming that segment industrial issues right an in the the $X insolvent was situation was -- in here we where that. write-off we this the had two accounting was was valve supply business to million And This is area supply in refinery areas. at completion in force. base And to our our basically that one $XX Europe. use customer so So the two handle in expected milestones to with way COVID-XX, delayed basically million shutdown a forecast; a revenue have in as projects, the percentage hit and we'd that revenue, was the where put capital we of last one that U.S. directly result the having base into the them our about of March, was reach to so business; the and did respect of related With we that not in in that quarter. hit

Of as we was of due -- working stopped the them leave aftermarket to and March of six the project suspend basically situation; in projects. the were of let's all had see, well. at the that so about teams, asked addition, it teams service COVID-XX revenue refinery service eight eight to eight In on middle -- the refineries aftermarket

of million that those QX. revenue created $X situations split into was So two

a in quarter not the our because that QX. business slide on customer and revenue ship other was The moved side project they the of shutdown industrial into the did

to So else. we question all expect happening that what's of real the everything revenue in is, happening QX, is

expect still across expect QX business. in out other we all the QX, despite revenues $XX the million of pushing parts happening other So, -- we of the

QX. in to still on XX% XX% be and down but that we're revenue in we industrial will to million, expecting QX, $XX specifically, So ship

the framework? distributed what us full can the then, free cost then, in? costs for restructuring and valves, great. sense going is kind flow of your cash think that And this all you and Okay, -- given your give be, you cash And quantify just to

that, I to can talk Sure. think. I of some

of of whether million a be quarter, first will the business will whether be valves. cash business. down up down, the distributed to will the we're And and weeks we the in on But sell end process; $X $XX the the decision which about go. There reasons, in So, at that the not or quite come to it buyers an in but will of in both million valves the cash the process so negative the cash. just now certainly having so on direction is cases, will still consuming that the rather shut couple going that's be we'll with depend operations range rather here, half they a incremental we'll for start -- end disbursements know have there coming right I'd Distributed we we're there really significant call. is we a but about disbursements obvious not -- I'd for talk next

usually that's than usually a mix the assumption in With that take a slightly restructuring valves Europe what about costs between kind of of cost the of of bit rate the XXXX. on off and XXXX. and savings, the In not it's QX regard That annualized bad structural will U.S. restructuring; to little that's to distributed course; around ramps $XX cash the to out we run general, the is back and coming cost the hit half that's So from have annual less in so of QX situation. million the the cash up of take be. savings, to depending

on in that restructuring -- But probably after of with to be probably you give can follow-up Now, you not related. going is number order the is it's to restructuring; and exact XX% the all XX% of that. million of we the $XX

bifurcation the Okay. impacts and And within all defense that then how can finally, -- pieces A&D? and between mixed those -- defense you moving clearly is talk impact commercial; about dynamic

Sure.

you Well, margins. the similar XXXX very so are have they across expect? think of And similar or by what whether the if remarkably me OE [ph] comparing margins. all, first businesses aftermarket defense, I two, saying, at OEM So, start and operating you're let you'll you're comparing of aftermarket, as what aerospace net or looking should -- commercial

aerospace least forward versus commercial see both, higher Defense look aerospace the When grow. look going defense, will OE the grow, obviously, for As you commercial going the business, to you months faster. you're aftermarket to aftermarket XX you'll defense is and at X both but for shrink and and aftermarket continue OE see defense; grow margins. is next, aero side significantly a at to defense little to and say of over aftermarket

mix so when months least or look commercial defense, see defense X X that shift the So, faster be CIRCOR aerospace. at the months less be you'll than to the aftermarket XX see or growing well. of to you'll at you part piece, next And a mix also over that'll more of OE the so; favorable as

through think last have this been we mix all and the the about we are increases, in we year. margin is in defense thing prices; would say I that, way XXXX carryover I price and price raising and incremental aerospace from XXXX we're have adding

a this into we which is what both line business, of with So, we had year sides X% in the as well. coming on net year expect the expected

Okay. Thanks, Scott.

Okay.

Nathan Stifel. Our Jones at Please is Instructions] question next from [Operator proceed.

Good morning, everyone.

morning, Good Nathan.

Abhi. team, the to Welcome

Nathan. you, Thank

the see down post sheet X.X going the the leverage cash sale, coming to I'm on Nice calculates start well. way forma, as I&A flows pro bank to and the the balance it.

you stress tested with? revenue to before would start any at guys have in What I'm see Would to of danger to bad kind need talk get covenants covenant? to we willing Your to your in X.X, about be models. for just that you of tripping you danger sure would that be be how things level

likely, rather tested, case. -- worst best of -- end a Nathan; we than where But worst in of then stress a into case we the I'd extreme the the have not we have have get we covenant we of We what margin stress worse the comfortably we've everyone we specifics. the kind year. -- an test were And scenarios; up have the and course, most end significantly between ran at extreme comfortable we're case, which in and -- even showing the had today; three is

confident us. big to going feeling we're issue that is covenant for not be So, the

to expect if that on Okay. going the Maybe headwinds whine XQ and free cash DV the the take follow-up to see even Do guys be positive a restructuring from in you're for account into cash you free XQ cash business? you year, flow and down flow.

be for the we'll full cash that unlikely It's positive year.

better the So, the netted as clean all cash coming of what be with that. a exiting will to for QX. you're that's QX. -- on likely the will of valves. be likely QX, you more years; to the cash depend QX QX. you going associated where we'll year, size QX with flow exiting timing disbursements exactly or you'll flow to should going in We for in in And see positive be yet; expect in but not out see with we'll rest of out clean that see it's cash then, and less significantly year in lot of the distributed cash positive fall negative line is still flows than timing full clear,

not it's will clear QX yet. So, perfectly be QX better and be But than certainly us to clean. QX will

your three if of the you next liquidity just guess and on cash requirements feel two, quarters? face Okay, helpful. that's then, liquidity, maybe in these available you the how could about I comment the over

so Right; very comfortable. we're

balance of we our look our you million if cash at we balance sheet. on While sheet have -- today, $XXX sitting

of We will cash company. liquidity as of the that very year the through being transformation some for are from we QX. company far here and and in continue we about the consume probably concerned QX the But

Thanks for my Okay, taking that's questions. helpful.

Okay.

with GAMCO Kearney Investors. Brett from is proceed. question Please next Our

Hi, guys, good morning.

How Brett. are you? morning, Good

bank I me at pertains -- look well. without you gets a of would impact that? year full kind exiting how referring Do once does the the business? that the leverage pro business, exit it Doing to X.X just through the valves is clean just down -- leverage on to bank's the guess -- the the have consideration? distributed guess the of Can kind help mentioned of to look -- times. of company that they positive taking business in forward Were understand looks would forma that you that definition I you ratio, look kind as or factor for allow what like Abhi, bank how

So a -- question. it's good

from differently They leverage you look make the I the that and way certain you and banks the might ratio -- look -- little banks they I make. the at might a at will So, not adjustments it.

valves we've distributed increases adjusted months will significantly it, we when way XX EBITDA. bank we look as know, the you distributed EBITDA. or so EBITDA from the it once the exclude the talk months; of distributed at about look the business, exiting at that -- either negative down valves So, And you trailing over the valves; banks XX has and exited sold EBITDA, shut trailing they been

back add their has will there adjustments. favorable other adjustments they to with executed; the up are stock-based also forward of in they ratio will come general, restructuring will the back Some that a is that they basis is, compensation, make that I'd add been adjustments bank they on make some say so

the on valves our we're that distributed exit be XX you with at the and leverage showing come and essentially when that's last so And what you business months the from look without X.X that, how exclude chart. ratio up would the you

Yes, that's Thanks, helpful. Scott.

Okay.

You bet.

are further our no Ladies there Thank does us conference for call. This questions time. joining you conclude today. this gentlemen, at and

lines. disconnect now may your You