Q2 2020 Cooper-Standard Holdings Inc Earnings Call
Good morning, ladies and gentlemen, and welcome to the Cooper Standard second quarter 2020 earnings conference call. During the presentation. All participants will be in listen only mode. Following company prepared comments, we will conduct a question and answer session.
Time easy other question you want me to press the Star followed by the one key Oh, sorry mind or this conference call is being <unk> and what gosh will be available on the Cooper standard website for replay later today.
I like to turned at called all back to Roger Hendriksen Director of Investor Relations.
Thanks, and good morning, everyone.
We appreciate your spending some time with us today.
The members of our leadership team, who will be speaking with you on the call. This morning, our Jeff Edwards, Chairman and Chief Executive Officer, and Jon Benet, Executive Vice President and Chief Financial Officer.
Before we begin I need to remind you that this presentation contains forward looking statement.
They are made based on current factual information and certain assumptions and planned that management currently believes to be reasonable.
These statements do involve risks and uncertainties.
For more information on forward looking statements, we ask that you refer to slide three of this presentation.
As a company statement included in periodic filings with the Securities Exchange Commission.
This presentation also contain non-GAAP financial measures.
Reconciliations of the non-GAAP financial measures to those most directly comparable GAAP measures are included in the appendix to this presentation.
So with that or the way I'll turn the call over to Jeff.
Thanks, Roger and good morning, everyone.
I appreciate the opportunity to review, our second quarter results and provide an update.
On the current status of our operations.
The second quarter presented us with unprecedented challenges.
Constantly changing information about the pandemic.
Extended shutdowns at most of our global customers with really no definitive plans for.
Resumed production varied health and safety rules and mandates in each of the 21 countries, where we operate.
And managing through all this is our teams and leaders working mostly from their homes.
Under these conditions were certainly proud of how well our teams managed the ongoing challenges and are pleased with all the quarter ended.
In fact through it all.
Some real bright spots in the quarter.
On slide five we highlight a few of those bright spots.
Despite the adverse conditions in the quarter, our teams were able to deliver $21 million and cost savings.
Through lean initiatives in improving operating efficiency.
For the first half there was a total cost savings of $37 million.
In terms of administrative and overhead costs.
The aggressive actions, we implemented last year and early this year resulted in 6 million dollar reduction in S.G.A. any expense for the quarter.
Versus the second quarter of last year.
With continued focus and effort.
We had another outstanding quarter for employee safety.
During the three months ended June Thirtyth, we had a total incident rate of just 0.39 per 100000 hours worked.
Which is well below what we consider to be world class standard of 0.6.
And in the first six months to the year, we had our lowest total incident rate ever had just 0.27 per 100000 hours worked.
We also achieved another great quarter in terms of serving our customers with world class product quality and successful new program launches.
At the ended the quarter or customer scorecards for product quality were 97% Green.
Our launch scorecard for the quarter were 98% Green.
This type of World class execution on our operations resulted in significant customer recognition.
During the second quarter, we receive not one but to G.M. supplier for the year Awards.
One for our sealing product line and one for our fuel and brake delivery systems.
We were among just 17 suppliers, who won this prestigious recognition.
For multiple products and the only one among the direct competitors to win this honor.
Moving to slide six.
Our customers are once again producing vehicles in all regions of the world and we're ramping up our operations to support their increased volumes.
In the Asia Pacific Region, we began to ramp up our plants in China in mid February.
In Korea, although the plants never close completely.
They had been operating it reduced capacity.
All 15 of our Asia Pacific plants are now open and have fully ramped up production.
For the region overall, we exited June operating at 100% of the production volume we had expected prior to the onset of the pandemic.
Importantly, 11 of our 15 plants in Asia have had zero safety incidents year to date.
We're certainly proud of our teams continued focus on this top priority.
In Europe production began to ramp up in mid May.
All 21 of our plants in the region.
Open by early June.
And have been increasing production at varying rates.
Obviously per customer demand.
For the European region overall, we exited June operating at approximately 75% of the pre pandemic volumes.
Our European operations are also delivering world class safety performance with 14 plant.
Zero reportable incidents year to date.
Finally in the Americas.
Our plants in the United States see it in Canada restarted operations beginning in mid May.
Plants in Mexico, Costa Rica in Brazil were delayed a little longer due to local conditions.
All 35 plants are now open.
And ramping up production.
For the region, we exited June at approximately 85%.
Of the pre pandemic volume.
In terms of safety performance 21 plants in the region heavy perfect safety record for the first half of the year.
I'm pleased to note that our sales in the second quarter outperformed market light vehicle production in North America.
Europe and Asia Pacific segments.
This is a trend we would like to see continue as production ramps up in the second half of the year.
For the consolidated company, we're currently operating at approximately 90%.
The volume we had expected prior to the pandemic.
Based on customer releases, we expect to ramp up to approximately 92%.
Of our pre cold and planned levels by the end of August.
Slide seven despite the challenges and disruptions we faced in the first half of the year.
Our teams have maintained constant focus on the execution of our long term strategic initiatives.
A key area of focus has been to optimize our operating footprint.
And fix for exit unprofitable businesses.
As we previously announced.
We were able to close the transaction to exit India and certain operations in Europe on July Onest.
Including this transaction we have closed we're exited 22 facilities since 2019.
And we have announced plans to close or consolidate two more.
We're continuing to evaluate opportunities to streamline our operations and lower fixed cost in our business as we aggressively push to improve our return on invested capital going forward.
We are currently targeting additional annualize savings in excess of $50 million from combined reductions in SG a any in Cogs.
Moving to slide eight.
In addition, we're continuing our focus on the strategic diversification of our business through our advanced Technology group.
As this business grows we believe it will naturally offset some of the cyclicality of the automotive business.
As well as provide higher returns on capital.
We're seeing strong quote activity for new business within our industrial and specialty group.
Keep in mind program lead times in this business are typically shorter than automotive or the applied materials science business.
Time from quote to started production can be as little as 12 months.
While request for quotes on this business has been strong.
We have seen some softening of current demand for sales into certain markets that have been disproportionally impacted by the global pandemic.
Such as aviation.
In the longer term remain we remain very optimistic.
About the growth potential of this business.
And our applied materials science business.
Aviats, which was previously polyone.
Recently launched there for Trex based barricade product portfolio.
And we expect related royalty based revenues to begin in 2021.
This is a major milestone for our Amex business really the first of what we expect to be many commercialized applications of our Fortrex technology beyond the automotive industry.
We also continue to make progress in other development agreements.
Advancing them towards commercialization.
The installation of our new prototyping equipment in our global technology centers now underway.
And is expected to help further speed the development process.
While we are priced prioritizing the advancement of our current.
Launch activity.
We're also pursuing additional development agreements in 2020.
Our focus remains on the same product sectors as we have previously communicated.
We believe this will allow us to build on the knowledge and technical expertise.
We have already developed potentially reach commercialization faster in the next series of A.M.S. agreements.
Now, let me hand, the call off to John for review of the financial details of the quarter.
Thanks, Jeff and good morning, everyone.
In the next few slides I'll provide some detail on our financial results for the second quarter and also comment on our balance sheet liquidity profile and capital structure.
On Slide 10, we show a summary of our results for the second quarter comparisons to the prior year.
Let me touch on some of the key figures.
Second quarter, 2020 sales for $304.5 million down 55% versus the second quarter of 2019.
Lost sales attributed to the covert 19th endemic accounted for nearly all of the decline.
Well unfavorable volume and mix.
Foreign exchange fluctuations in customer price reductions also weighed on the quarter sales.
Adjusted EBITDA in the second quarter was negative $93.8 million.
Compared to positive $58 million in the second quarter of 2019.
Again, the most significant driver of the decline in adjusted EBITDA was the impact of the global help endemic and industry shutdowns.
Weak volume mix and customer price reductions also negatively impacted results for the quarter.
These impacts were partially offset by improved operating efficiency and other cost reduction initiatives.
As well as lower SG, a any expense.
On the U.S. GAAP basis net loss for the quarter was $134.2 million.
This included a $12.4 million noncash charge related to adjusting the Indian and European net assets included in the July 1st divestitures to fair value.
As well as certain project costs related to the transaction.
Excluding these charges restructuring expense another special items.
As well as the associated income tax impact of these items.
Adjusted net loss for the first quarter 2020 was $111.8 million.
Or $6.61 per diluted share.
Regarding capex are spending in the second quarter was $12.3 million.
Down considerably from $35.9 million in the same period a year ago.
Our global teams have done a fantastic job of limiting or deferring capital spending where possible in response to the current challenges in our industry.
We continue to anticipate that lower investment levels will continue through the remainder of the year.
Moving to slide 11.
The charts on slide 11 walk the significant drivers of the year over year changes in our sales and adjusted EBITDA.
For sales the impact related to lost revenue due to covert 19 approximated $380 million.
Considering overall weak industry volumes during the ramp back up.
Unfavorable volume and mix, none of customer price reductions reduced sales by $37 million year over year.
The negative volume and mix impacts were primarily in North America in Europe, and were partially offset by positive volume and mix in Asia Pacific.
And foreign currency fluctuations resulted in a negative impact of $7 million to revenue.
For adjusted EBITDA are ongoing efforts and lean manufacturing and operational efficiency drove $21 million in cost savings for the quarter.
Great result, considering these efforts were hampered by the pandemic.
We also benefited from $6 million lower SG, a any expense as a result of the organizational streamlining we proactively implemented last year.
As well as elimination of all discretionary spending in response to pandemic.
We continue to improve our cost structure and are taking real costs out of our business. So we're not done yet.
We expect this will become more evident on our bottom line when industry conditions and production levels normalized.
But in the second quarter are significant cost reductions were more than offset by the impact of industry shutdowns and incremental costs related to the colder than 19 pandemic.
This net impact was approximately $130 million.
Unfavorable volume mix and price adjustments.
As well as normal inflationary pressures accounted for the rest of the decline in adjusted EBITDA.
Moving to slide 12.
As of June Thirtyth, our balance sheet and liquidity profile remains solid.
We ended the second quarter with $388 million of cash on hand.
In addition, we had $32 million of availability on our revolving credit facility.
For total liquidity of $420 million as of June Thirtyth 2020.
It's important to point out that our revolving credit facility remains undrawn.
The availability at June Thirtyth was reduced significantly due to a decline in our U.S. and Canadian trade receivables and inventory balances, which comprise the borrowing base for the facility.
As a receivable balances begin to rebuild now that weve resume shipments to our north American customers.
The availability on the ABL facility will also increase and be back to normalized levels here in August.
In view of industry and economic conditions, we continue to carefully monitor or liquidity outlook by conducting detailed cash forecast and analyses on a weekly basis.
We are continuing aggressive measures to reduce and or defer capital expenditures costs and discretionary spending wherever we can.
And we are maintaining or intense focus on working capital management with initiatives to accelerate both accounts receivable and tooling collections from our customers.
Lastly, a few comments on our asset allocation priorities.
We issued $250 million of senior secured notes back in May.
We took this prudent action to provide a cash cushion that would allow us to maintain sufficient liquidity in the event that the industry shutdowns were to extend longer than expected.
Or if the industry where to go through a second wave of shutdown.
Our current intent, which is subject to future market conditions.
To preserve our cash balance as much as possible and generate additional cash and liquidity over the next two years such that we can deliver as soon as markets and contract terms alone.
With that let me turn the call back over to Jeff.
Thanks, John and to wrap up our discussion this morning, I'd like to provide some additional detail on the ROI see roadmap plans.
That we introduced last quarter.
We can turn to slide 14.
And the Cooper standard, we've really always prided ourselves on working every day to deliver value to five distinct stakeholder groups.
Our customers our suppliers our employees the communities, where we live and work.
And our investors over.
Over the past couple of years Weve serves four of the five very well.
But recognize that we need to do more to better serve our investors.
We are making significant changes to drive increased value going forward.
Last quarter, we announced the formalized framework that we're using to drive increased ROI see overtime.
During the second quarter, we made large advances both in the execution.
Of some of the related actions as I discussed earlier in this presentation.
But also in terms of defining specific goals.
Setting meaningful capesize.
And establishing the internal team structure needed to ensure oversight.
And accountability for this important program.
We've established cross functional teams to drive and track improvement in all aspects of our business, including commercial manufacturing.
Engineering.
Purchasing and supply chain.
And all administrative areas.
The goal is to drive return on invested capital back above 10%.
Overtime.
As we've done in the past.
With quantified targets in each functional area and defined activities to achieve them.
Our engaged employees are stepping up to the challenge.
I am confident we will succeed.
Our entire global team is certainly committed to it.
In the near term, we continue to face considerable uncertainty.
In our industry and the various markets we serve.
While we are seeing positive signs for the near term light vehicle demand in some regions.
Other regions are not bouncing back quite as fast.
With this backdrop.
We're not providing formal guidance at this time.
However, we do expect that the impacts of our cost reduction and return on invested capital improvement initiatives.
We'll be evident and significant.
By year end.
I want to once again, thank our global team of employees for their contribute their continued hard work and dedication.
During these challenging times.
How they have responded to recent adversity certainly has been inspiring.
I also want to thank our customers for their continued trusts and.
And support.
This concludes our prepared comments.
We would now be happy to take any questions that you may have.
Thank you, ladies and gentlemen, if you like to ask a question. Please press the star followed by their won on your telephone.
No question has been asked around your words, you would like to withdraw your registrations.
So by pressing the pound key.
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Dan will be I've a question just press Star then one.
And then please ask only assembled making her question.
Our first question comes from Joseph probably see Ali.
Cantor Fitzgerald. Please go ahead.
Thank you.
And on the comment about.
Operating it 90% to 92%.
Pandemic, you had some dispositions, India and Europe is that on a like basis, meaning go forward assets compared to last year.
Yes, Joe it's John <unk>, Thanks for the question.
Well, we're referring to is the remaining businesses that are still under the Cooper standard portfolio will be operating at 90% to 92% capacity.
The other divestiture of of facilities.
India in Europe, we're not including in those numbers. Okay. Great. Thank you and then just wondering I know I've heard this from one or two other companies maybe different industries that.
The pandemic has actually helped accelerate some transitional.
Changes decisions.
Just wondering.
If you are seeing anything of that nature, if anything from a timeline.
As being accelerated easier or or seeing actually new opportunities.
Sure. This is Jeff I I would I would say that the.
The teams, whether they've been working from home or or lately, we've had more and more returning.
To the technical centers, along obviously with the plants I would say, it's a very focused engaged atmosphere.
Certainly there is not the travel around the world. There is not the running to different meetings that that normally a present opportunities, but sometimes distraction. So I would say that that we we've not missed a beat if anything we've probably improve the efficiency of how we're operating the business that's first point.
Second point related to the.
The ROI see improvement plan that we have rolled out we really began put that together prior to the pandemic. We mentioned last year in 2019, we took out significant costs and fixed costs of our business.
We sharpened that approach as we got through the first quarter. This year and we announced here just recently the the details associated with that ROI see roadmap. So.
Was really part of our plan prior to the pandemic, but clearly we are using this particular period of time to to make further adjustments.
Sure Sta any in Cogs costs that have actually proven to be even better than we originally had had plan. So I suppose you could argue that that we have benefited in some way.
Really all around the all around the business from it kind of hate to describe.
Global pandemic is something you're benefiting from but I understand the context of of the of the question and I would say, we certainly have as well.
Yeah no. Thank you I appreciate that night I didn't mean to its just the reality that certain companies that already we're in the process of making changes will benefit from this is.
Good or bad Okay. Thank you.
Thank you and our next question.
Ryan Good we'll be out with please go ahead.
Good morning, just maybe what stark you hopeless frame what the royalty revenue stream will be for 2021 out of BTG.
Hey, Brian John Ventas here.
We're we're not quantifying that yet we're being thats a in essentially in startup mode and this is our first a significant agreement where we're holding that close for now and you should expect to see over the next couple of years that that grow and magnitude and once becomes material for us that will break it out separately.
Okay, that's fair enough.
And just as we think about actions that you've taken to date.
Yes, I'd like to frame in addition to some traction.
As I look at your business there seems to be a lot of opportunities for you to add value to spice walking away from business can you talk about how you're thinking about your global footprint.
And.
Areas that may not be performing let's just be honest South America do you really need to be in South America. Today could you could you sort of redirect that capital to more fruitful uses going forward.
Yes. Good question. This is such F. Edwards.
We have said.
Said publicly that any business that we have that isn't covering our cost of capital either gets fixed.
Sure It leaves.
So I think thats pretty clear what we what we think.
And that's what's driving the the execution in the road maps and frankly.
The divestitures that we we just executed here. This this summer is all a result of that you'll continue to see more of it.
Hopefully.
We are able to fix them and don't have to figure out a different alternative assets, so our preference but.
You know will do whatever we have to do.
Understood and.
Well do respect.
As I don't think south Americas ever generated.
Positive EBITDA.
So I'm just trying to stand is it your customers that are really looking viewed to be there I'm just trying understand sort of the process. How you guys are thinking about the sea turtle.
We will either cover our cash cost of capital or we won't be there.
Understood and if I heard you just lastly, if I heard you correctly onto capital allocation priorities, if everything goes as planned and as I understand right. Now you just you know husband cash on the balance sheet, and then look to repay the firstly notes off at the first possible call date.
Yes, that's kind of the the current thinking there's there's some other maturities that'll come due within the 20 to 23 timeframe that will look as a as an overall capital structure package there, Brian so but that did that is the current intent certainly here in the near term with the uncertainty with the gold pandemic.
Thats still hangs over the economy, we're just being a little bit prudent before we make any other alternative decisions there.
No I think it was expensive, but I do think you did the right thing raising that to 50 last quarter, a second menu for that.
Thanks for the time appreciate it.
Okay. Thanks Brent.
Thank you. Our next question comes from Josh Seide Calfskin with Credit Suisse. Please go ahead.
Hey, guys. Thanks for taking the question I just a few for me I guess I guess first starting up now that we're hopefully through.
The worst the pandemic just thinking through.
Next steps for improving margin profile and Aro I see that Jeff was mentioning at the end of the prepared remarks I was wondering if you could maybe share some light on kind of the goals and keep you guys you're tracking in the near term and then.
You know any detailed on steps you're taking maybe over the next couple of quarters.
Sure. So I think we have we've provided really the the lane ways of each of the.
Each of the projects that were that we're attacking and and just to name a few we've talked about SJP and Cogs, we've talked about.
A couple of the businesses in Europe that need.
Significant improvement.
We're after we're after those we've talked about on the commercial side.
On the material economic side the supply chain.
These are all areas that are that have specific capesize tied to improving the margins of our business.
And specifically with the focus on getting return on invested capital back over 10%.
If you go back over a 10 year period, most years, we were performing that way.
Clearly we had some things go against us.
The last couple of years, it's not to make excuses, it's to make sure that we.
Deal with reality and get those things fixed so we can get back to the level of performance that you expect in the we expect.
Got it and then just some in that plant S.U.S. uranium Cogs. The 50 million I think is what you're targeting per annualized savings Uh huh.
Do you expect to have that fully implemented by year end or what's the timeline of that.
Yes.
Okay.
Okay.
And then my next question just just thinking about.
Cash flow generation for the remainder of the year kind of in the context of where the market environment is assuming that still holds do you feel like.
Positive cash generation in the back half is within arm's reach or what are the puts and takes that.
Yes, Josh it's John.
Clearly our cash conservation efforts along the way here have increased with the increased production are expected to generate positive operating and free cash flows in the second half of the year.
But certainly may not be enough to overcome the first half negative outflows related to took over 19.
We do expect positive working capital generation to continue and that's really going to be driven by our focus on the trade and tooling receivable side and the teams global efforts to take further days out of inventory levels.
So those those old the the beneficial in helping offset increased outflows as production ramps back up on the accounts payable as well as accrued liabilities and the like.
So.
The package altogether, we think we're on track for a positive second half but of course that always depends on Q4 from a seat and typical seasonality Q4 tends to be our best cash flow quarter, historically and based on the industry environment outlook that looks to hold true, but we'll see how things progress here.
Got it Okay and then final question for me just wanted to understand the borrowing base.
A little bit better and looks like at least on the face of that just looking at the current asset.
ER.
Current assets and liabilities in the balance sheet relative to decline.
In the borrowing base availability, just it's it's kind of tough to match up. So can you maybe talk through kind of the the drivers of the big decline I think it was like a 76% reduction in availability year or sequentially from one Q.
Yes, Josh John again, it's really all driven by accounts receivable. So the two main categories of collateral under the Bill are you us in Canadian accounts receivable, and then U.S. and Canadian inventory levels. So those two components makeup the total borrowing base that go against the the total $180 million committed.
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Certainly any any small letters of credit that we have outstanding will will deduct from that that availability.
But also there is a fixed charge coverage ratio trigger whereby it's the the.
10% level and call it a hold back essentially of the borrowing base before that that a fixed charge coverage ratio trips. So we don't want to go go but below that and so we we include that in the 32 million dollar amount I referenced for the June borrowing base.
So as a shipments have have ramp back up.
Accounts receivable will grow accordingly, as we as we'll inventory levels and so like I said by by August here, we're back at a normalized borrowing base level back above $102 million to $125 million or so.
Got it that's helpful. Thanks, very much guys I appreciate it.
Thank you. Our next question comes from Bob America with JP Morgan. Please go ahead.
Hi, Thank you just a couple I mean this you touched one on working capital a minute ago. So I guess it was a little surprised that you had a negative give or take 30 million in the second quarter I mean heading into this.
The affords and the GM to the world, saying that they were going to burn through a bunch of working capital in the second quarter, but most of the suppliers, we're talking about getting the benefit the opposite of that.
Is there anything.
Unusual that happened I know you talked about my main question was about second half what I was just trying to understand the second quarter a little better.
Yeah, Bob John So in the second quarter. When you when you think through the the working capital elements, we were still collecting on.
Accounts receivable that we had made shipments back in March.
But that that ran out to you when you look at the global payment terms run out and call. It. The may timeframe. However, we're still paying where we were still paying on all our fixed charges.
And the accounts payable balances for inventory purchase that had longer longer days payable outstanding on a global basis. So when you think about capital purchases that we made back in Q1 those bills essentially came due in Q2, so with the wind down and accounts receivable collections coming in.
The outflows on the accounts payables slash capital expenditure side that we're previous commitments.
Created the overall outflow so it wasn't a surprise, we had forecasted that way and they that's how we kind of saw Q2 playing out.
When you get into the back half of the year that trend the weavers.
Okay, Yeah, so on the back half it sounds like you're hoping to be part I mean, but.
Yeah.
My concern was with what happened second quarters that third quarter as you ramp should continue to ramp back up we see or kind of.
Get exacerbated by more outflows, but net net for the second half of the year, you think a neutral to hopefully positive is.
Totally doable I guess for working capital.
Yes.
Okay, and then Capex I know you kinda didn't give specific numbers, but you kind of said your yes, the 30 or 35% today. So it we're at 60 65 for the first half for the year.
I'm, assuming below that number for the second half, but can you I mean do you think you'll end up around 100 can you can you kind of narrow it down.
At all.
Yeah, Bob we're still on track for that 100 hundred $10 million level.
We have talked about this on the last call <unk> as well as over the last several months. So we think about a 35% reduction from where we thought we would be for the full year, which coming into the year was 150 155 level. So I think we're still definitely on that on that Tracfone.
Okay, and then lastly, just.
I think it was slide 12, you talked about from last quarter, all the stuff you did.
Salary deferrals, obviously travels restricted but the more probably on the deferral type stuff is any of that going to.
Kick back in like I know.
Totally different company, but Ford said, they're going to kind of reinstatement salaries sooner than they thought and.
Are we going to see like.
The second quarter, SG nay wasn't down that much coming from first quarter a couple of million dollar. So I'm just wondering are we going to.
How much in aggregate dollars are we gonna have to add back in.
Kind of for recruitment and will that be later this year or will that be more like next early next year.
Hey, Bob It's John again, when you look at our ESG knee. Our deferral program was just that it wasn't a.
Permanent reduction in wages and salaries. It was just a deferral. So we continue to accrue that expense in Q2.
And it's really just a liquidity play that we put in place until we expect to to be able to to eliminate that deferral in the in Q3 here and then a good cash outflow is the plan is to in Q4 are reimbursed employees for that differ.
Okay, so, but but the income statement numbers.
It is still in lighting.
Okay.
All right. That's all I had thank you.
Thank you and I sat in mind, our latest again to many of you have a question guess press Star then once again Mccann.
Our next question is on Baylor Scott <unk> with Carlife. Please go ahead.
Hey, Thank you for the call would you be able to provide us a liquidity number as the 731.
Broken out between ABL capacity and cash on the balance sheet.
Bill we're down to position to to give those interim type type disclosures at this point.
But you had mentioned the Abbeel capacity is back up to do with 100 125 million dollar Mark and again, we remain undrawn.
Thanks.
Thank you and our next question from my caffeine or with a good <unk>. Please go ahead.
Hi, guys. Thanks for taking my call I was wondering you could address the amount of proceeds you expect to receive from the Indian and European acid District just.
Sales.
Okay.
Yeah, Mike. Good question. This wasn't a harvesting opportunity on the cash side really there's a there's a small dalry that were end up paying two to divest those businesses. So not not significant but we will pay a little bit too to the buyer to take his business suffer hands.
Okay. Thank you.
Thank you end up here and we have no question I will like to turn the call back to Roger Hendriksen.
Okay. Thank you everybody for your participation. This morning should you have any further questions or would like to learn more about Cooper standard. Please don't hesitate to reach out to me directly.
We look forward to speaking with you again.
This concludes our call. Thank you.
Thank you ladies and gentlemen. This concludes today's call you may now disconnect have a wonderful.
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