Intertape Polymer (ITPOF) 12 Mar 212020 Q4 Earnings call transcript

Ladies and gentlemen, thank you for standing by. Welcome to Intertape Polymer Group's Q4 2020 Conference Call. [Operator Instructions] Joining me from the company, I have Intertape Polymer Group's Chief Executive Officer, Greg Yull; and Chief Financial Officer, Jeff Crystal. I would like to caution all participants that in response to your questions and in our prepared remarks today, we will be making forward-looking statements, which reflects management's beliefs and assumptions regarding future events based on information available today.

You are cautioned not to place undue reliance on these forward-looking statements as they are not a guarantee of future performance and are subject to a number of risks and uncertainties that could cause actual results to differ materially from those expected. titled Statement X further Slide see Safe for Harbor discussion. Please

XX, reconciliation be call, under certain remind being A measures financial dollars, over is we dollar at comparable this our http://www.itape.com. most referring otherwise Yull, to noted. the turn March to in recorded, like is conference the the U.S. now unless measures go may at please Eastern everyone rules. available are to defined During GAAP a.m. as this Please also to amounts would note directly all that non-GAAP we'll Mr. measures XX time. XXXX, non-GAAP today, I SEC ahead. Greg And website at Yull. of www.itape.com, financial call that the

Welcome and IPG's year-end good quarter and everyone. call. you fourth morning conference XXXX to Thank

Joining me our Jeff is CFO. Crystal,

temporary up billion million. The pandemic. XX.X%, business EBITDA XXX wave despite basis depths up of to the reference early first $XXX across pandemic. will was section Investor and earnings experienced call, communities year a was an demand XX% website. make than Revenue that the May the XX% IPG we April from Adjusted and business our was more for fronts, the outstanding points free up and rebounded more to the was well perspective. the of to $X.X During from X% our $XXX Adjusted up can a It to Relations families, was in million. EBITDA business. our you a to of our our number during margin quite download was than year cash late from flow we presentation XXXX incredibly

In emphasis our well we of of and The The than in packaging, working essential is end made performed eCommerce demonstrated in protective products on a and uninterrupted insured end the wovens, and XX%, ECommerce market clear in for experiencing tape, are the general manufacturing investments our persist general one different the markets the beverage, members vaccines rolled we XXXX and Their supply safely our we business users. customers, another. team food the two believe films. markets is activated uncertainty. to of and are as that are They years. what during professionalism neck strongest servicing period customers and growth serve. we've and structurally suppliers followed XXXX. out. construction we to our accelerant represented five in water our by to end now exceptionally demand market and IPG after the where building largest at is in the neck with Our came end demand successfully this XX% In were past today order. produced where ones like end retail we will eCommerce products manufacturing that same that

come at which eCommerce future channel business than XX% base level. estimated many to served to years XXXX, the simply pull a expected will to reports Our eCommerce pandemic with macro Independent continue grow new line eCommerce to through a sales third-party in adoption largest in the which is and grew growth eCommerce retailer. for from establish more forward is continue. The by

new new we line to in to production our line install be growth of outsized differences this growth. to today. The a significant existing our within exposure business most to eCommerce pace water with our announced Our in this tape plant plans will activated installed one is morning, footprint. the the demand channel keep This increase

XXXX. our investment confidence This and we We first expect the installation in the in have late in commissioning outlook. of demand XXXX, demonstrates half

growth XXXX, made our we and in significant debt cash progress delivered on we the free repayment. With generation flow

to is XXXX. the which EBITDA, adjusted X.Xx now turn is compared leverage end X/XX of a total Our down of

we maintenance. target water and to categories. experiencing than not protective These on for we across represents a growth end within Based horizons on capacity with of $XX which than greenfield There in this generate higher growth XXXX, the to and projects in that $XX near-term where expansion strength million our product million shorter-term in of million projects beyond. incremental rate but also expect and X.Xx. this demand the offer is categories, sheet Xx production activated risk to projects million million the expansion, capital expansion. in are packaging, investing transformation in previous $XXX tape, to the is in consisting multiple XXXX across that return capacity mailers, and capacity represent In revenue run our $XXX wovens They growth expand outlook cost approximately balance we we're only capacity a in expenditures million highest strong. of Our areas greenfield and films, $XX opportunities $XX growth low nature. regular are XXXX, in digital in remaining and operate increase no thresholds in range in savings, invest investment in With organic were total, basis to new the the a expect by additional more projects,

XX%. after-tax these to expect IRR capacity We the expansion be from of projects north

We $XXX the growth $XXX anticipate at represents free XXXX This of revenue million mentioned different the still flow invest earlier. growth which XX% or that this of than $XXX anticipate while range. are which are to of in quite between billion to production We outlook. to I XXXX midpoint we We takes for which and anticipate flow range. few important our total fiscal our XXXX, expand to XXXX takeaways and billion, from adjusted which be between strong of is There of million be $XX $X.X able capacity, million, represents cash the generating outlook $X.X XXXX. morning, at for XXXX. in million announced cash for free the consideration growth for midpoint X% We capital of and between approximately expenditures $XXX into that million, EBITDA anticipated

free growth growth in We and projects confident business. the different The are in to business of maintain structurally the is flow the generation. cash near-term invest today, strong with ability trajectory

adjusted EBITDA outlook the specifically extent - seen, in and in lesser still recently significant --- materials polyethylene prices movement to consideration increases have a impactful we revenue but and also into polypropylene takes Our prices. raw

the retain We points to some We multiple of have retain decade. materials, selling to and you draw low mind, in can course as the contribution. we a prices contribution, margins of the see degree. across raw in selling look mid track over of that the spread effectively rise spread high, managing across that price the outlook With between ranges record freight, last and and to dollar managed the dollar cycles

already increases have announced price price We reflect of raw the rising to materials.

increase, basis normally margin annualized takes on price income hit days revenue approximately XXXX points has a statement. adjusted into announced metrics pressure we once reminder, anticipate our our and approximately Based an on outlook basis, the of EBITDA. to taken we a XX it XX been in already current As of which situation, consideration

growth to with we of a deliver of are is We core merge key pandemic the the as sustainable a from be to preparing like end our needs pillar in strong to eCommerce Sustainability continued markets strategy expected growth. solutions. address position

on same outperformed a XXXX are throughout product perspective and in major continuation not and immediately stand first activated films, others of limit mix shareholders bundle. categories on In a our like interest Based of the Our that the in address membrane our best certainly our pat returns business, our is are as consider product and allow customers. fourth categories and water brainers. the quarter, We structure of to to capacity we would work this and a jeopardize expand quarter verticals. product inaction order achieve as highest demand could to major organization tape, sales opportunities of the cradle-to-cradle embrace we from all Growth The demonstrates commitment perspective. fabric, in the are production our seeing demand investing of growth volume the XXXX. in no period would shareholder certification customers. be well a from sustainability We at book believe we to us, projects ability support front these strength the to and our

lower protective we demand. within We very is are in the call where that think in are future turn you with opportunity our existing footprint financial a a and areas to results. capital over We I'll These packaging have great for to with have. global projects who any comfortable built point, this At Jeff? Jeff provide into insight leader will the company solutions. additional risk

driver million the $XX.X you, the quarter fourth XXXX fiscal our to On million was of X% the over in an $X.X periods. just XXXX. increased XXXX. increased million of XX% On both same annual to quarter, revenue to mix for X up up in basis, of period Revenue in periods, and analysis an primary Page the compared presentation, respectively. we growth Volume Thank Greg. and XX% fiscal the X% and to up year in fiscal compared $XXX.X revenue billion, present $XX.X quarter the

quarter our air where years, invested annual period the As Greg activated and five in the pillows, water growth specifically machines. and the acquisitions mailers we product and in the categories capex tape, areas mentioned, were highest in during past

one by of the an drag quarter a the non-eCommerce comparable were annual in effect versus the in tapes, closed XXXX, foreign well we as customer remaining the basis, of in annual quarterly Essentially, industrial were nominal we tapes. COVID-XX our both the most are some the strong up the underperformers result activated of Nortech, categories the as XXXX, positively industrial up of categories. the as quarter, period. experienced carton water a our of exchange. in in which revenue the on couple made as tapes, and tapes, number X% in differences carton During of period in On of Price well and experienced of channels. February X% we product also excluding sealing impacted save among XXXX, some The of all acquisition significant growth period sealing period a

and XXX in The fourth due in the quarter corresponding improvements XX.X%, up Turning XX% increase performance up to asset by to quarter to to and to compared fourth operating leverage primarily gross Gross margin pricing and quarterly in were the fiscal to periods in the points as in the both raw benefits materials both in improvements periods growth associated the respectively XX.X%, management to more annual EBITDA period points annual up due and operating margin XXX and plant and were well XXX Page in points and $XXX.X increased and spread capacity. profit. the XX.X%, The EBITDA that costs organic X. the $XX.X corresponding increased XX% compared prices the between basis effective to and periods basis raw points to more respectively, in Adjusted XXXX. compared in These the performance reflect than basis periods plant million selling than XXXX. was Adjusted XXX leverage the million freight of at was as as as periods material and I XXXX more base earlier. than up running due in primarily well spread between XX.X%, XXXX. improvements the mentioned basis

We inventory already protect carried them sufficient Texas scheduled dollars. Texas later our are to keeping coming industry key key monitoring impact recent our online the reports. is events intend to spread supply protect from the month in on weather-related and to cases in in in some of according to the We other contribution while quarter up customers managing dollar materials to first quarter. by profit our resins the supply, of into manage our Production the our cases, fourth back of in We raw this back situation chain. be

tax U.S. that of legislation any effective in potential and XX% from of range XXXX. increases for the potential rate resulting an earnings of expect between as we XXXX, changes well the rates impact mix XX%, jurisdictions, the in excluding For changes as tax

operating XX% previously We in to that to in the of XX% periods less Free bonus approximately operating period expect corresponding income as the period period CapEx $XX primarily free the in totaled flows fiscal quarter and million the CapEx and call. quarter annual second of to compared annual to fourth cash 'XX, fourth and the third quarter increased the annual show business quarter as cash $XXX.X in increase in expense the impact flows higher experienced are cash the XXXX tax in the in flows depreciation related from activities mind on free million, announced respectively. in gross to million Cash profit. taken. period were tax $XX XX% of up carryforwards, same taxes we in due the the that flow the we of fourth availability million, quarterly free XXXX cash improvement in Keep XX% of and compared cash due flows unchanged half and the well be increased majority $XX.X to from attributes periods to In first up annual typically generated due the quarter, than loss million the the from to were in flow negative million capacity cash seasonality in year. $XXX.X XXXX. activities the $XX.X period, the and

it secured leverage below ratio highest that most of the to covenants, view secured our ratio as The debt priority. is Our the end relevant decreased X.Xx. leverage to net is well covenant at that the of important X.Xx we the XXXX, - ratio

down X.Xx, total period. from leverage including the the X.X X.Xx turn Our ratio, in debt, sequential decreased to unsecured

balance efficiency. experiencing, growth. and our strong in to deliver consolidation great to expertise open remain or growth and is We position our strengthen our power markets a apply in business that buying our product where sheet with we mentioned, we the our operational Greg the and organic provide acquisitions potential can are bundle demand position As opportunities

his executing organically. I'll today to of for on turn it back immediately closing focus primary our to in is demand front However, over Greg? grow thoughts. the us Greg

Jeff. Thanks, and change began the pandemic a year. essentially it than today year that longer just the the one live lot one onset was we to work. way ways, ago many In feels of It

business team performed Our well. and has exceptionally

The structurally opportunities excited of business The share are given us. product of us, films rollout in eCommerce our of demand since The us channel growth we markets in with in growth second XXXX sell our the other the categories. activated product confidence and business and the into, to like and the now the front half XXXX. our grow tape. ability gives in today vaccine woven resilience the position As acquisitions different disproportionately benefits the our is of in into and executed high we continues, market categories about investments water end we've XXXX

low-cost world-class, asset a manufacturing have We base.

profile Our is margin stronger and sustainable.

free shape. Our in great flow balance our stronger is and is generation cash sheet

Our the the to perform. confidence to XXXX we in continue business demonstrates outlook have

turn days like to long-term of to employees. ahead. are deliver for been have Thank to our XXXX I'm and demonstrated, commitment are has team even With tremendous. our strategy challenge. We operator to call better a have back themselves executing the of open thank conducted the believe the level it's I'd to-date, proud XXXX how you. value certainly truly the organization our shareholders. the a I'll up that, they to period. and question-and-answer I

Thank will Please you. Scotiabank. ahead. Doumet first question come [Operator from Michael Instructions] from Your go

line open. Your is

again. Great quarter,

$XX I So you QX, quarter. generated just at average the your an million per and look EBITDA on question your If guidance. first about of adjusted QX

$XX to the at XXXX million. of average your hand, end you generate guide, other the quarterly EBITDA On upper of expect EBITDA an

get either much comps healthy your of tough this potentially conservatism? So maybe just to I two. with seasonality, to trying higher on obviously, just of half second take resins, do a the reconcile has to or just appreciating I the want amount mean, how

Yes. question. good No, it's

back at into So, being basically, headwinds I discussed like the this the there last at we mean, some year, that some coming we the I obviously, look two when you certain into costs as one quarters way saw are stuff it, and year, look coming we business. mean, things

the things it. shelf, deferred we'll or come that were last put into So year on back

one sales, somewhat well costs. SG&A, of see some so you'll the as additional as as So flow that some And of through reason. that's cost in

environment. we other material discussed that rising The like is is part raw

the but we look I there that the short-term temporary again, throughout mean, storm. something really hard And that's year, to be around some could those to what impacts. working impact uncertainty going some to degree. the of Texas of uncertainty the impacts going are that's to So is around cover, us the like impacts, some

things. that of So some those of some some for account in conservatism we baked took

these what's for the going end some two really will to But in see there kind that I that. I is be back look uncertainties like impacts then roll in everything's overall, to the mean, what us vaccines the COVID, related what those look the in do are that what do for think and day, of the half of resins how like? going So does once out does And year? tough of to place, the of account and demand to at biggest you're that

heard pressure points you, accounted basis And you of sure it make piece, right, I guide? okay. to just Got on margin the in already for your XXXX XX resins highlighted,

Yes, just math, basically right. that's so the

going cover profit where to higher same that's revenue dollars believe just a So the and on have essentially, you we're we number.

I we to XX%. we're midpoint, at the that, probably guidance like be at our we'd around said So XX%. mean Without in closer

Got then second you, the on commentary okay. for there. And mean thanks the I question CapEx,

and the bigger of has expect your to is in of company picture COVID. quite what post or had CapEx mode growth into XXXX? a Intertape Just be bit the you've I or harvest strong terms CapEx a catch-up will is, eventually back on in investors guess the to company sort step obviously timing, to question projects here of a pared here. XXXX should revenue Should growth maybe due XXXX. back look and essentially go Meanwhile,

And a and see handle have of don't we of kind volume, we the visibility even commented growth now, experienced with off as growing to the a is e-commerce we growth we right capacity just certainly base. XXXX, think that strategy key I So, on the in component that here. of installed go-forward that

rate. a on of growth go-forward see hope comment above as those next other growth projects about that And really the into this growing certainly to to further at markets continue the we would facilities. capital continue the we And those couple have that capital. are that that prospects, that and our feel basis, of is, deploy to tied we to those as years projects year I in-house our current are is the kind on into we all is So, through that fact And on well confident ability the XX%. move IRR make commented the in

Got you. Thank you. are Those good paybacks.

Thank you.

Daryl Your ahead. Securities. next question go from comes Young TD Please from

line is open. Your

good guys. on a morning Good result. Congrats

you. Thank

units million will that you of demand? the projects, that investment? already from effectively produce regards pre-sold of type post be you the Just number Or on is growth to the expecting revenue would to just of based can, you're with $XXX be able incremental

it I mean, we we're So, pent-up some that products that currently is the in, we're putting of capacity demand currently have, some that refilling of outsourcing. we're

small of that, that would So into business. there's a balance go expected piece the rates growth our into

good And certainly have pre-sold we've capital we in per out good e-commerce. of is sight So got on of not most forecasting sight we going areas, But line in into of those that that line se. certainly area. believe

is there great. And at e-commerce, the product there XX% consistent across in Okay, tapes, when we is fairly as outsized? the all it well water as significantly one then protective growth packaging is activated look that's or

from films from leaving biggest higher protective percentages exposure our just I there area. our tape growth perspective, categories percentages e-commerce dollar on a think area, a perspective, a and namely the in a our in aside is for packaging though, dollar percentage product basis Well, saw sec, into other category. we On

those certainly much in areas percentages are the higher than tape category. the So

kind from there? trade Got type or order you end-markets. some the have more book you. your already? then remains one industrial normalized of in upside aerospace a And traditional much Would last How reopening manufacturing you of one, say

Yes, in the industries I more upside are some that there. under some there be say could certainly pressure, more mean of I'd

it's certainly, seen to percentage to recover, see say start probably able would see huge mover a be we some I lot the to that's point. at not can But going of again are don't But could back a our of up, again, how this needle and travel pick some has recovery know been much our to in Once, we things a people of something favorability. there. As things expect we've transportation revenue. I'd end-markets, laggard.

Thanks right. guys. very All you. Got much

Thank you.

Your MacLeod ahead. Capital next question from Please from BMO Stephen comes Markets. go

is open. line Your

guys. you. Good morning, Thank

morning. Good

morning. Good

wanted focus a just to gross bit in on little margin. I the

the definitely the QX, year color just it felt safe good beginning that acutely that seen extreme in with it's inflation pressure with progresses? down XX points inflation, the that be of basis helpful. pressure because of that to expectation some Is would more to full-year be we've gross gave margin You the the the sort material is like dissipate assume headwinds raw would as

do put would first more through raw I the from it We half, we peak progress as the we're probably impactful on more Certainly, now. expectation in year. materials, at just on the second an quarter.

the cost front, expect some see tempering June on sometime around Specifically to that front, we front, in resin May, price timeline.

after our that P&L days we'll on So that. within see XX

with So I half first at the look now a right think we it's way it.

And disruptions? offline? you've any is inflation Or that any that dealing helpful. Like, you actually that have do supply? completely have with? just more And accessing that's it supply Okay, the inputs come you have you're seen in specific disruptions had

very of has last through side, supply the things we is prior say to perspective, that the we're carry carry storms disruption in our tight, companies here time, namely are some certainly most be would resin from week, get Certainly the in polyethylene, as able it's we've year I Force really going building over tightness inventory that From to sit sure. a declare started believe been offline. we weeks going the chemical the people still that most a dramatically in are to this perspective, and in to an from minimized, perspective and had believe we raw offline, but Houston. I inventory to QX, material seen six possibility. we've There's last today. back-up companies majeure, operational, supply dealing plastics supply. Well, for still and polypropylene, busy or through, been beginning It chain with a

focused? Is a And little be it to then little leverage is just of would you come be a mentioned mentioned to maybe you give finally, that? that there nicely. down for end-markets? And e-commerce color Okay, what largely safe it thanks bit has looking you color. kind Or opportunity bit targets beyond Can of about potentially assume that at with respect more you'd around acquisitions.

our of into so opportunity to that bolt-on M&A. say look products we perspective that technology at technology that much product growth but believe our acquisitions Yes, consolidation relates some vertical. a there's have at areas it and point companies are, where perspective do we there the that further to and and, that ourselves, our that or lines product take the within both and platform to supercharge no put into can to focus certainly Not at really a changed someone's we really mean product the put focus supercharge still in top certainly margin this we're are differentiate into can believe I industry, as because we from it is believe can products line looking primarily I hasn't primary differentiated cases, growth. that our platform disruptive in and

guys. Thank much you that's great. so Okay,

Thank you.

go Walter from Please from Capital ahead. comes question RBC next Your Markets. Spracklin

open. Your line is

Thanks, morning, operator. Good everyone.

Good morning.

into demand double-digit now warrant So the XXXX would in to your a slowdown is will e-commerce capacity my and comes growth in see then you're that business we that bringing when come suggesting in plenty can point guidance be growth kind such call capacity that side, is you if much how in and the capacity of or approach in it might level, at your to later consider capacity Or you from away 'XX the question would again that in revenue XXXX, that that your rate? of growth of a the to online interim? do here have kind yourself turn from in XXXX, you have really about you wouldn't on capacity grow on expansion

the I mean benefits of hit mid-way starting half that to lot investing XXXX. think projects that we're now, or come end or into back a the online of with mean that XXXX really sort I We back that in of will

to XXXX into So that certainly, capacity a even with XXXX. we well and see runway grow into

couple double-digit a point e-commerce, we're be business But propel be to there's level want or constraints where right, next have to these certainly certainly to going help where again, - again. mean, a now years. But where se. to think, unblock to will there's certainly we expand course, invest I to we you and to not if So of going have those point us in to away where going a a de-block see grow investments turning I us are and of continue through going lot per you're really expansions of the

second And water side do tape would way? is, have of also would much more with a customers how I product? could to run of my look e-commerce activated their to you to tape And tape And with share more question grow grow much then what that differently company? their in Amazon, you product much share it therefore or water runway tape you much customer ask market opportunity your with that percentage the your how larger would terms in have demand, how on develop new that existing are of your total is activated

question. So good

we we're And and products to when bundle North of not within e-commerce, into the customers when tape market share it lot to So share outside services America. individual selling of e-commerce, be accounts. those of but be look specific think customer gain and as definitely will products, you a relates a of specific, at that

I the there. still world, product higher opportunity reference opportunity And whether to we've South on there's that's so this the offering. made lot there's product than of growth lines. broaden areas year, the product that segment a America, around percentage within lines to Europe, much done other so But Asia, tape of So our

curbside pretty Mailer, then you also that that stretch everyone Kirby that packaging. remind for opportunities within within as protective looking would the customer. equipment which to more extensive within within that I'd within things such And as at when start And then mailer, that So that well. recyclable be certainly is perspective potential servicing facilities a to just much the and have program, not provide but customer in equipment, And where also us techs just service our tune service closer a segment, puts the we we equipment those facilities.

broad. product the strategy more going still that e-commerce share spend. the In I tape of growth there opportunities I segment North be think pretty within are a to in is to category take think that's of specifically. So share retail the as offering And America, takes

product point. specific just That's Greg, as some getting us it e-commerce much some it give on is as ballpark mean in of I but it for grows doors? sight industry even a us good a which it at to of customer that ballpark is it without us you if XX% of all a is tape be, Maybe customer percentage obviously how line of a XX%, to your come is adoption? good a - it for embedded the boxes water if activated could it customers is people's growth to superior it believe total gives an

to that, Tough Walter. answer

I don't think with in would but your you would if a all arrived look that I amount need say look you you well be boxes, really get be a box. at within bit, out is boxes that by done of sent answer e-commerce a I'd know when tape be and definitely it's boxes which XX% helps in XX% to packages box. of little over the to obviously packaging tape, at would and above

you very thank right, it. time. for Appreciate the much All

Thank you.

CIBC. question Please next from Thompson Scott comes ahead. Your from go

line open. is Your

you. Thank And morning, gentlemen. good

Scott. morning, Good

packing I the talk well-developed tapes? materials capacity questions markets. like can you on inflatables Are some situation But Couple e-commerce the pretty fillers in the are build of hearing about and a on competitive your hearing activated front. you obviously, mean, of what you're water new products?

expansion. in been really that we packaging e-commerce. details anything Yes, continue activated to to with But And forward around towards of I mailers. there water done certainly lot that there's tapes, category. in seen there. the has get that do participating won't growth you'll area, been expansions certainly a basis. some geared I into some, that go think a certainly specifically And haven't protective plan capacity We've in having that see on on in we

that XM market. that understand I exited

that's chatter, correct. any that hearing assuming they're not You're going to

that any You're not hearing chatter re-enter? going to they're

product, think product. I producing in business I think sourcing No, they they were don't that were ever

Okay, makes sense.

long-term. much they're the ability chatter packaging matter? fact there customers there Is pricing minting so the on just through that here Or the on over is a to the that on pass it penny any pricing Now, or pressures, or from increases pushback? doesn't

prior mean pushback quite issue Certainly I raw situation this my were certainly is rising there's inflationary from I perspective, the materials look to Texas. an always unique. in think weather career Well, in

there point pressure of upwards within weeks, of that. was on production the was amount XX% to supply you of at pressure I a offline one two at lot think on chain a the of probably prior offline XX%, chain. was for supply period production put when So raw that look materials of And

about but at of extensively pricing with I than go less get somewhat, we even when perspective, then issue that to to for think subside supply expect it at of certainly issue a to level side, those an see that and some half from around levels were forward things resin that not the you're a QX. forward, on pushback mentioned bit position. move that this I pressure. we're price with But year. to becomes in say when the there's customer this price. one supply out circumstances through well Not customers we And certainly, fact increases, second on to ride we the And to we've around the side So certainly that of in communicated is you positioned as going earlier, you I still our they'll that it's above everyone reduction in think exact believe

think look you selling would there or that at sense. to makes to That are shareholders? question, capital either recycle or Final Thanks. product capital categories return of any selling

at we time, nothing can disclose. Not this that

much, Perfect. Thanks gentlemen. very

Ocampo question ahead, open. David next is from go comes Your Securities. Please your Cormark from line

everyone. morning, Good

morning. Good

When Walter's probably about as think to add utilization. reasonably can footprint, another we wanted you're capacity going or about have to do manufacturing XXXX, you add more just follow-up square we on on have you or your footage question XXXX that or, Greenfield? based enter I lines to the

we plant been to look our Certainly, when have expand facilities. at always our footprint, existing plans

you then you on upgrades capital building. And more top to products that, of XX%, recently in opportunities equipment, have of a Certainly braces, the footprint Brownfield we're there have produce just on opportunities concrete. that capacity swap out new you vision to make to the expand. piece walls many had we've 'XX, that sure a bit existing at put of that new in the to technology a where blowing out four we the always when within the of the that So, plants, to the there we Certainly are in land pouring equipment. and XX% deploy of a and could same look can if be further you equipment built doing old XXXX, wall plants for

we any our for So in kind see certainly perspective, of from next don't our Greenfield's. three-to-five-year look need

many comfortable you a And do the a to of the areas we and kind to able move can't, and out that. expand were instances, in we we'll capacity infrastructure within four able if will we'll add Brownfield, walls. wall to that be be So support that in

free provided, And numbers, under I but EBITDA guys when two the leveraging helpful. to at cash look with. you capital and one comfortable it that, like that does final following-up That's get range here, allocation. are the again on look guys just are you going that flow And your you turn guidance

you how So capital to harvest opportunity? times? below about just that Or start allocation wait shareholders? as do an we returning you cash for acquisition the should where think you two capital Is something and trend

return a shareholders. is a our see time Yes, or I allocation forward we're from or that the certainly have see going about discussion to capital And opportunities the now. that that's capital continue seeing of capital to the deploy to And kind certainly to On the times growth think my certainly, leverage, go could the hope organic from perspective, growth. if at we highest see that we're with for if that do of an basis, board perspective, we that's and continue perspective the for that we acquisition. capital organic we below don't growth get two trends

That's you. Thank it for great. me. That's

Thank you.

Bank next Zachary question Financial. from ahead. comes go from National Please Evershed Your

line Your open. is

quarter. Congrats Good morning, on everyone. the

you. Thank

your have odds So the does brought is Texas Do it you down, delay of that, supply be come If your import on online have there through footprint? and global production can't fashion. disruption a but a in building in indication options timely remain possibility. back an outside

on are are have up But sit of right morning, this being that we production been We things a adhesives back back the here as global Yes, and now, really supply is freight from area we the freed-up remember But we there certain running. long certainly around chain days. seen material in specific I But be running, perspective, as right past do. ocean to might disruption, disruption today. If that here it not and a tight. is we've they're facilities in the well. time front kind raw period or the those material a have we shipping And as we've sit somewhat they of at supply see certainly tight. last, getting running adhesives as be And up five over over XXX%. don't seen

have American be but the support ability do mean, So any is I full at opportunities could would North we there Asia, and is from look we capacity an when or produce facility. have because or disruptions, temporary Asian a some that I around to the in there, do for relevant think we listen, North there point the though, think products Asia need, your certainly we I facility here not from America assets that there

can That budget? of CapEx more And you really helpful color, thanks. us about the tell the piece then digital transformation

sure. Yes,

to lot, transformation within then this looking at year, operations. small our and year is on doing we're and what a a half So plant digital is a extent, a is more

solving our technology certain we we've regards really And to actually not be a in big just problems we're just with been methods, disparate modernizing data, traditional Robotics ran systems Artificial Utah we business. to just manage the And been really Intelligence investing technology pilot good a as able Intelligence, some Artificial it's So with plant. that solved in well. and with And right. way our of massive success and

technology, you're of with issues to were way And and can things the that were just people you and imagine identify just So managing have. looking hidden. new they trends a always previously possible now lot this it's

pilot. we've nice seen So savings already from some that cost

cost moving to more expect and of through see plants over some with deployment so mass our throughout a And these coming forward few of the savings we're years. scale next technologies

it. So that's the crux of

And topic mortar any weakness penetration, brick Thanks. on growth. you pull e-commerce think forward e-commerce and in terms the foresee orders same then I page in interesting. the reopens? That's do But of in on we're directional long-term the as of

same a we be still you're It it to we've basis. certainly I rates year. be. the experienced, think I percentage not But And forecast. when won't you but that Well, level, down into think on forward, go factored growth the will will growth, as this see slow at our going certainly

information to in to from use are be rate, forward going of a perspective. But I platform there a retail think movement think think is will on expect there as that growth. consumers those going platform. I growth see And So basis. well, again, that continue us to to that And go participate I I continue you that mean some when you the adoption spend see the to

Absolutely. make gap of pay are the and And don't what occurring And case, what valuation what's the just but that's M&A the sense the just if to one abundant, you're more for between at? on me. Are size front? they your opportunities transactions willing

specific, a well, there competition to out that's transaction there, and think there valuation private these because Yes, anything. been capital, it's around pretty be continues very hard challenges I out to money and sure has as now to for with from equity, got answer, deploy you've specs much there but looking cheap

So mid of we where said, seen still we sweet plays probably bit is and is people have growth, us In relevant, growth. kinds of that but we spot. on the see EBITDA couple for disruptive like look there's large their about and supercharge And medium the talking when and obviously, to the those identify we you're something might Greg multiples, typically we that Like to disruptive you'll the products a that also doing can want expectations. stage issue. times, call be companies the an high, then there's process, of no be it smaller bolt-on things that side, at like believe valuation that that products, that would probably generating in larger an cases, that And when at it touched question out nature, ton on a you've because in deals, acquisitions their company digits, we call think room is single isn't more competitive of look at of I earlier those of a a technology, take growth. to a a has less ton reasonable multiple

landscape we of cases have of by gives to we're again, evaluate what those that case So, looking kind the in you case but at.

Appreciate I'll the answers. turn Thanks. over. it

All you. right, thank

Yull questions. like call back I Greg further to would the remarks. to no closing turn have for over We

release today's results call. you for speaking following in the first XXXX participating We to in look with forward May. quarter of you our again you. Thank Thank

gentlemen, today's and this concludes your Ladies call. Thank conference you participation. for

may disconnect. You now