Q1 2021 Schnitzer Steel Industries Inc Earnings Call
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Ladies and gentlemen, thank you for standardized and welcome.
Mr Steel first quarter 2021 earnings release conference call.
At this time all participant lines are in a listen only mode.
After the speaker's presentation, there will be a question and answer session to ask a question. During the session you will need to press star one on your telephone.
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I would now like to hand, the conference over to your Speaker today, Michael Bennett and Investor Relations. Thank you. Please go ahead Sir.
Thank you and good morning, I, and Michael Ben and the company's senior director of Investor Relations.
Im happy to welcome you to Schnitzer Steel's earnings presentation for the first quarter of fiscal year 2021.
In addition to today's audio comments, we issued our press release and posted a set of slides both of which you can access on our website at Schnitzer steel dot com or S C H and dotcom.
Before we start let me call your attention to the detailed safe Harbor statement on slide two which is also included in our press release and on the company's form 10-Q, which will be filed later today.
As we note on slide two we may make forward looking statements on our call today, such as our statements about our target volume growth and future margin expansion.
Our actual results may differ materially from those projected in our forward looking statements additional information concerning factors that could cause actual results to materially differ from those and the forward looking statements is contained and fly too as well as our press release of today and our form 10-Q.
Please note that we will be discussing some non-GAAP measures during that our presentation. Today. We have included a reconciliation of those metrics to GAAP and the appendix to our slide presentation.
Now, let me turn on the call over to camera Lundgren, our chairman and Chief Executive Officer. She will host the call today with Richard Peach, Our Chief Financial Officer, and Chief Strategy Officer.
Thank you Michael Good morning, everyone and happy New year I Hope you all had a good holiday break and like me are looking forward to a healthier safer and stronger 2021.
At the beginning of our calendar year always coincides with the announcement of our fiscal first quarter results.
This year, we are reporting our first quarter results under our new one schnitzer operating model.
The efficiencies from this model combined with the supportive market environment contributed to the strong results that we announced this morning.
On our call today, I'll review, our quarterly financial results and the market and macroeconomic trends affecting our business.
Also provide an update on the strategic initiatives and investments we have underway to address evolving industry dynamics and create long term value through the cycle rich.
Richard will then provide more detail on our financial performance Capex investments and capital structure, all wrap up and then we'll take your questions but.
But before we get started on this review I'd like to make two comments about the performance of our team.
These past 10 months and been full of changes and challenges for all of us steel because at 19.
The operational and financial results and I am about to discuss would not be possible with on all our employees from our front line workers to those who have been working remotely living our core values of safety sustainability and integrity.
Our success is the direct result of how each of you has embraced these values.
Regarding safety as you May remember from my comments last quarter and each of the last two fiscal years, we have reduced recordable injuries to record lows for our company.
And the first quarter of this fiscal year many of our sites demonstrated that our goal of an injury free workplace is achievable.
90% of our locations, where recordable free and the first quarter.
We still have work to do but our teams commitment to continuing to improve its clearly showing through.
Thanks go to all our employees for making this happen.
So, let's turn now to slide for to get started.
In mid December we issued our seventh annual sustainability report, which included multiyear goals centered around our sustainability framework of people planet and profit.
As one of North America's largest metal recyclers sustainability is at the core of what we do and how we operate and has been since our founding and 19 and six.
Advancing sustainable business practices and further integrating sustainability throughout our operations have been foundational elements of our success.
And last year's report, we set forth our first set of multiyear sustainability goals.
This years report describes the significant progress we've already made.
Two accomplishments that I want to highlight here include first achieving a 15% reduction in greenhouse gas emissions and our recycling operations.
And second and exceeding our 90% carbon free electricity goal well before our original target date on fiscal 25.
As a result, our new carbon free electricity goal is to achieve 100% net carbon free electricity usage by the end of fiscal 2002.
I encourage you to visit our website and view our latest sustainability report, which describes how we help conserve resources, how we innovate to use less water and energy and to generate less waste, how we create a safe ethical engaging and inclusive workplace.
And how we get back to the communities, where we operate.
Now, let's turn to slide five.
Earlier this morning, we announced our fiscal 21 first quarter adjusted earnings per share of 57 cents our.
Our results reflect adjusted EBITDA of over $40 million, which was up 40% sequentially and was our second highest first quarter consolidated adjusted EBITDA in the last 10 years.
As I mentioned earlier, we benefited from strong market demand for recycled metals and finished steel products as.
As well as from the execution of commercial initiatives and productivity improvements and enabled by the full transition to our one schnitzer operating model.
Our Q1 metal spreads expanded and.
Both ferrous and non ferrous prices increased during the quarter with non ferrous prices seeing a particularly steady rise throughout the quarter.
Sequentially, our ferrous volumes were approximately flat and our non ferrous volumes were lower due to timing of shipments.
Demand for finished steel products was strong with utilization, reaching 97% versus 85% a year ago.
We also return capital to our shareholders through our 107th consecutive quarterly dividend.
Let's turn now to slide six for a review of pricing trends for recycled metals and finished steel products.
As you can see on this slide global raw material prices rose to multi year highs by the end of the quarter driven by a strong recovery and automotive demand supply chain restocking a resilient construction market.
And scrap supply constraints related to cold and 19 restriction.
More specifically ferrous export price increases on the east coast were positively impacted by stronger export demand for Turkish steel products.
Through October turkeys crude steel production had increased 4.2% year over year as steel production returned to pre pandemic levels to meet higher domestic and export demand, while ferrous scrap imports into Turkey or up 19%.
Ferrous export price increases off the west coast were driven by strong semifinished steel import demand from China.
And higher steel production in Asia and.
A key global driver for the increase in West Coast ferrous export prices has been China's increasing steel demand and chinas, new ferrous scrap import standard, which have reclassified ferrous scrap as a recycled raw material.
We expect this to create higher demand for global ferrous scrap.
US domestic prices for underpinned by similar trends the latest U.S. economic data reflect durable goods orders industrial production and housing starts rising and November from.
Ferrous prices have now reached their highest price points in a decade.
Decembers Global auto sales doubled from their April lows and more in line with pre pandemic levels.
Current auto inventories are at 10 year lows.
Container shipping is experiencing its strongest demand and at least a decade and some steel order books strength into March and even April.
If we turn our attention to the non ferrous market, we see and even stronger price recovery environment.
Non ferrous scrap prices increased steadily during the quarter and reached multiyear highs and December driven by strong global demand, including from China.
Zorba, which was trading as low as 34 cents per pound last year.
Is now in excess of 70 cents.
Well not shown on these charts PGM pricing has been moving and lock step with base metal pricing over the last several quarters also reaching multiyear highs.
The recent sharp increases in ferrous and nonferrous prices have been driven by low inventory levels. After many quarters of Destocking, followed by significantly higher steel mill and smelter by plans and production levels.
There are also many long term trends that support strong and sustainable ferrous and nonferrous scrap demand, including the transition to lower carbon technologies.
China's elimination of quotas for non ferrous scrap imports that meet its metal content standards.
And the prospect of China's reemergence, as an importer and the global ferrous scrap market.
In a world that is seeking de carbonization, we expect recycled scrap metal to be an increasingly important metals carbon solution and for demand to accelerate.
Let's turn now to slide seven to discuss some of these trends, which underlie sustainable demand for recycled metals.
Despite the uncertainty and near term market conditions due to Cove at 19.
The long term drivers of recycled metals demand are underpinned by several trends that remain intact and are gaining increasing importance and relevance. These.
These include the increased focus on reducing the environmental impact from steelmaking by lower and greenhouse gas emissions and reducing energy consumption.
Our steel mill is one of the very few whose primary energy source comes from hydro electricity.
Combined with the use of recycled scrap metal as its primary raw material for steel we produce has an exceptionally low carbon impact as compared to the industry average.
Equally important.
Is that a low carbon economy is widely acknowledged as more metal intensive.
Whether it is driven by the demand for electric cars, the deployment of renewables the transition to fiveg or the efficiency and convenience of smart grids, a green economy means a metal intensive economy copper.
Copper as a conductor of heat and electricity is the most relevant and important green growth model.
Nickel is likely the next biggest beneficiary of electrification given its role and batteries.
Aluminum demand is also expected to rise and it is key to reducing the weight and vehicles.
Recycled metals require less carbon to produce been mined metals.
Well a variety of social solutions will be required to de carbonized the manufactured metals value chain.
Increased use of recycled metals is one path that is achievable immediately.
We can see how some of these trends have already been translated into higher ferrous scrap metal usage by looking at the chart in the upper right hand corner of this slide.
The proportion of global E F steelmaking ex China has been expanding and is projected to increase.
And in China, The Chinese government is targeting a 100% increase and Eas based steel production by 2025.
China's increased scrap demand is also being driven by optimization and their Pos EPS, which can take as much as 30% scrap input versus their 18% current average.
Let's turn now to slide eight to review the strategic actions, we have underway to address these evolving industry dynamics.
Okay.
Efficiency and innovation underpin our strategic initiatives to leverage our industries positive near term and long term trends and to offset cyclicality and structural changes affecting our business.
Let's focus first on what we're doing to optimize our through the cycle performance.
In April we announced our plan to transition to a functionally based integrated operating model, which we call the one cents or model.
This was the culmination of our evolution to a more simplified operating platform to improve our efficiency and enable greater focus on the critical drivers of our business.
Our operations sales services and other functional capabilities have been consolidated at an enterprise level.
And with our first quarter results, we have completed our transition and our reporting our fiscal 21 Q1 financial results in a single segment.
We have already reaped benefits from the transition to our new operating model first as one integrated unit, we have become more organizationally efficient and able to respond more rapidly changing market environments, including the COVID-19 disruption.
Second our ability to increase our focus on growth, including from new products and services has already begun to deliver benefits and higher volumes and third bite.
By standardizing our operations to ensure our low cost operating position.
We have been able to more quickly adjust our operating costs, which supply and production volumes and solidify the productivity benefits and cost savings, we delivered and fiscal 20.
In Q1 of this fiscal year, we exceeded the run rate of the targeted productivity initiatives, we announced a year ago.
In addition, as Richard will describe in more detail on.
Our investments and advanced metal recovery technologies are well underway.
Extracting more non ferrous metals is a significant value added process and is directly aligned with global demand trends.
Copper demand for example, little benefit materially from the low carbon transition through growth and renewables and electrification wind power and electric vehicles are particularly copper intensive compared to fossil fuel based technologies.
We expect the benefits from these projects to be substantial and.
And to increase our volumes and revenues lower our operating costs and improve our margins expand our product offerings, and our customer base and support our sustainability objectives of increasing recycling and reducing waste.
So now let me turn it over to Richard for a more detailed review of these projects and our financial performance.
Thank you Tom and good morning.
I'll begin with an update on our advancements will recovery technology strategy.
Construction is steadily progressing on two major news nonferrous processing systems and.
On the waste on the East coast and the news on the separation system.
And the south Eastern you and.
Being built to serve or east coast operations.
Planning is also will go on for on additional Zorba separation system and.
On the west on the U.S.
Well, we continue to move forward with great focus how these meetings could really its abilities to equipment delivery.
Permitting and construction.
Subject to normal for believe we'll know targeting the completion over new and solutions by the aim for school year Twentytwenty one.
Once implemented we expect the benefit to EBITDA to be at least $10 per favors total.
She equates to operating income per ferrous ton of $8.
We also expect the new technology to increase the volume of non ferrous recovery from shredding by approximately 20 per se what.
Which equates to around 50 million homes per on them.
Based on our plan and rule, we anticipate our courts will these benefits and fiscal Twentytwenty one.
We expect our total capital investment for the a bunk metal recovery projects to be in the range of $100 million. We have spent approximately $50 million to be including main volume goals and the first quarter.
We expect to spend the remaining $50 million and the bones of for school Twentytwenty one.
Shameless, new quality standards for imported raw material became effective in November.
Recycled non ferrous metal that meet these new standards and moving it imports into China without being restricted by Bhutto's.
This structural change reinforces the importance of our technology strategy in particular are focus on enhancing product quality and the increased optionality the old and new systems will provide.
Now, let's turn to slide team to discuss for sales and the market dynamics.
Global demand for recycled ferrous increased and the fourth quarter, which was driven by continuing economic recovery.
Benefits of government stimulus and concerns over tight supply.
Oh for flexible operating platform.
Or logistics expertise.
And our global sales reach on.
Oh Hell post to maximize the benefits from this heightened demand.
We shipped 63% of our business and the core to the export market and.
We sold the remainder and to the domestic market.
Our total country destinations for ferrous exports for Bangladesh, Turkey and Vietnam.
So, let's turn to slide 11 for an update on non ferrous market dynamics.
Demand for non ferrous also increased in the first quarter market prices for the aluminum coal per absorber all reached multi on your high.
Several drivers support these price improvements, including economic recovery.
Disruptions and supply.
For customer inventories on the weaker us dollar.
And the first quarter, we sold on most business products to 17 countries, including India, Malaysia, So Korea and China.
And then let's turn to slide 12 to discuss our performance trends and our outlook.
Our adjusted EBITDA in the fourth quarter was $40 million. This performance was up significantly from $28 million and the fourth quarter of fiscal 20 on gross quadruple the adjusted EBITDA in the prior year quarter.
The combination of improved market conditions and benefits from management initiatives led to an expansion over operating margins and.
Adjusted EBITDA for ferrous and.
Reached $30, taking us to pre condemning levels last achieved in fiscal 2019.
This also represented a sequential improvement will be $11 per ferrous on.
Our own top of the increase came from improved markets on the other half from actions we have taken.
These included.
For commercial initiatives and productivity improvements, which were enabled by our new one Schnitzer organization model.
And the benefit for $2 per fairness to and from a sales contract simple.
Benefits and the quarter from average inventory accounting would approximately $2 per ton. This.
And as compared to a similar impact and the previous quarter on an adverse impact of $4 parts on in the force course over the prior year.
Ferrous volumes increased by 8% year over year and sequentially were down slightly by one per se.
Non ferrous volumes were slightly below last year's fourth quarter and.
And were down sequentially by 13% of sales volumes and the previous quarter, partially benefited from the timing of shipments.
With the U.S. economy still recovering supply conditions remain sorry.
On the ferrous and nonferrous on car purchase volumes are not yet, but so the average quarterly run rates and we saw in fiscal 2018.
[noise] finished steel sales volumes were up year over year by 18% and decreased sequentially by 4%.
Rolling Mill utilization was 97%, which reflected the steady demand for long products and the with from U.S.
Sequentially average selling prices for ferrous and nonferrous rose by 14% on.
Finished steel.
Prices were up by 1%.
For ferrous and non fitness market price improvements exceeded the sequential change and average selling prices because our shipments reflected sales or gross me before the significant rise and markets Lisa and the quarter.
Sales prices for platinum group metals also grew significantly and this contributed positively to our EBITDA results.
Looking ahead.
It's still early and our second quarter on they're still almost two months to go.
And in the second quarter, we expect or ferrous and non ferrous sales volumes to increase by 5% and 20% respectively on a year over year basis.
Sequentially, we expect ferrous and non ferrous sales volumes to approximate the fourth quarter as benefits from higher demand are anticipated to be offset by seasonality.
On tight supply of scrap.
For finished steel sales volumes and the fourth quarter benefited from strong demand and a rising price environment.
And the second quarter, we expect normal seasonality will lead to finished steel sales volumes being down sequentially by approximately 10%, but still well like five per cent for the first half of fiscal 21 compared to the same periods in the prior year.
Based on the higher price environment for recycled metals on.
On continuing benefits from our productivity improvements and on commercial initiatives, we expect EBITDA for ferrous tons and the second quarter to be up sequentially by approximately 20% I know you on a year over year basis should be higher for approximately 60 per.
And.
Now, let's move to slide 13, and discuss our cash flow capital structure and corporate items.
Operating cash flow and the fourth quarter was on a little of $7 million driven by increased working capital from the higher price environment.
And the timing of previously accrued incentive compensation payouts for fiscal Twentytwenty.
Looking ahead for the second quarter and subject to the timing of shipments we expect to return to positive operating cash flow.
Net debt increased sequentially to $136 million and at the end of the force quarter.
A ratio of <unk> debt to adjusted EBITDA was still only 1.2 inc.'s cash.
Capital expenditures and the fourth quarter totaled $32 million.
For fiscal Twentytwenty, one as a whole we expect to invest capital expenditures of up to $125 million on.
Approximately half of the summer and will be for growth projects and the remainder for maintaining the business, including on environmental related capital projects.
Oh, the effective tax rate was an expense of 27% on or adjusted fourth quarter results looking.
Looking ahead, we expect the tax free and the second quarter and also for fiscal 21 to be approximately 25% debt.
Its projected tax rate is subject to a performance trends and the balance over fiscal year.
Finally, and the fourth quarter, we achieve productivity improvements from $6 million and have now exceeded the targeted annual run rate on the initiatives. We on those in the first quarter of the prior fiscal year.
Oh and the tone the presentation back over for summer.
Thank you Richard our strong first quarter results reflect the resiliency of our operations and the agility of our team and leveraging positive market conditions.
On delivering on our productivity and operational efficiency initiatives and executing on our longer strategic initiatives.
We have a strong balance sheet with low net leverage and interest expense.
A strong track record of delivering positive through the cycle operating cash flows.
And ability to invest and the growth and productivity of our company and an and interrupted record of returning capital to our shareholders through our dividend.
Our performance can be attributed to the steps we've taken over the past several years and steps, which are currently underway to continually improve our business performance.
With the construction of our advanced metal recovery projects expected to be completed and this fiscal year.
The greater emphasis on recycling the continued growth and global E F steelmaking capacity and the increased metal intensity of lower carbon based economies the future for our business and industry is bright.
In closing I'd like to thank our employees for their extraordinary efforts. It is your contributions and performance that demonstrate why we have continued to be a leader in our communities and the recycling industry for over a century.
Thank you for everything that you are doing to remain safe to keep your families and friends safe and to support your colleagues your communities your country and our company.
Now operator, let's open the call for questions.
Thank you as a reminder to ask a question you will need to press star one and your telephone.
Withdraw your question press, the pound key leased and balance compiled Kenny roster.
Our first question comes from Tyler Kenyon and with Cowen Your line is open.
Hey, good morning, and a happy new year happy new year.
Thank you.
Just with respect to Chinese relaxation of the ferrous import ban I mean, you've been hearing of some some cautious behavior on behalf of both buyers and sellers and the near term I mean, perhaps you know the absence of some arbitrage given current price levels and and.
And maybe some uncertainty around regulations and quality specifications et cetera, Oh kind of wondering if you were hearing the same and and maybe how big you think the intermediate term opportunity is for Schnitzer and other U.S. Saks borders to supply.
It was material the channel.
Well, thanks, Tyler for that question and.
And and so it's a very and it's very it's a very good one right now because this is a big move and to have kind of reemerge.
And they Oh buyer.
Ferrous scrap in the global markets.
In the.
And the last 10 years, or so or let's say 20, <unk> and yeah last 10 years or so until they banned on ferrous imports in 2018 day, we're importing probably around 2 million tons from about 10 million first on the year in that range.
They're buying was really underpinned by raw material pricing arbitrage I think today and its early on and obviously this came from was effective January one and January 7th right now and it's very it's very early times.
But their decision and they have articulated it and as it's been reported.
Is too, it's driven not by pricing arbitrage, but by their goal to lower steel, making emissions and they moved to decarbonise. Their economy. So I think that this is impactful for the global market I think it will I'm sure take time to ramp up but you know weve, we and the company I've dealt.
And with China on the ferrous and nonferrous and sides for decades, and I anticipate that they will come back and be a meaningful player and the goal and markets going forward.
Thanks for that and and yes to your point I mean, as China margins at current these.
Longer term plans to increase Yep steel production you know within their borders.
I mean, do you have any expectations or any thoughts around any potential additional forthcoming ships and economic policy to dress pant other constraints that we're seeing and scrap collection I mean, it and really seems that that's where it is just on the collection phase for the processing infrastructure, you know seems relatively decent but yeah curious and.
And how you see them resolving this problem, particularly at such high levels of Chinese steel demand.
Well I think you know, it's driven very much business driven and in the rest of the world by a where are your mills and processing and where your scrap is being generated because no matter, who you are scrap doesn't travel and long distances efficiently overland.
And so I think that their scrap collection and and process is going to be a function of that proximity.
Got it Okay and then just a quick question just on Canada, and scrap flows and I think Richard you. You may have made mention for those just on your comments back and yeah and each other and keep you comment exactly where.
Okay, and now called for instance, and dynamic levels and there's kind of a barrier.
Significant bearing on across great game or gross.
Inputs horses.
Yeah, Hi, Hi, Tyler it's for sure and supply volumes are still running below or ER for school 18, and average quarterly run rate by something around 10% and.
In terms of the floors. So.
So on the economy continues to recover.
We should see volumes volumes increase and as you know we get.
On operating leverage benefits.
And other volumes go up and I think we previously established that.
For every hundred Thirtys and tons on volumes go up.
And we get on operating leverage benefit over revenue one goal for total accruals across old tones.
And terms all your your question regarding where we're seeing strength resources losses weakness, we have seen some some increases and you know deal and and payable fools and build up a pickup and and manufacturing.
Auto is still you know wagging was with lifts miles being driven.
And you know the generally low and been free inhaled by supply on the other the money for the market less.
And so this is something that we're very focused on from a commercial point of view I think we're doing very well, but you know, we see benefit and too.
Sure our volumes on their margin supply.
Pickup was economic improvement.
Thank you and and just one last one on an opportunity for US and did you change the and.
For 10 targets and your new advance metal and better technology investments are.
And maybe you mentioned $8 a ton of EBIT previously 10 day is it going to be the day was that is that right. If that's what I'm, saying.
Yeah, you're absolutely correct there for cellular that the L., we eat goals parts on okay.
And EBIT and for.
For ferrous ton is equivalent to <unk> and $10 per ton of EBITDA.
So you mentioned the booth signal enhanced the target that we gave to the booth and Eva measure on the on operating income.
And your but they are they are equivalent and made sure that.
And dollars on these goals.
Thanks, very much for that quite good.
Thank you. Our next question comes from Michael The Soc with Keybanc capital markets. Your line is open.
Hey, good morning, good morning, mom and so for first on the steel side I'm, just wondering if you're seeing better pricing power now that one of your competitors recently left a day, the California market.
Okay.
I think that.
The the price.
Pricing activity you know the level on demand is it's really driven and broadly by and by the market and.
So I I, we haven't seen any a significant difference or oh on on the price.
Okay and.
And then within CSS are they benefiting from strong west coast construction markets and and that's why 20.
I'm just I'm wondering if you could provide for more detail on kind of what you're seeing there within construction and we've seen some of the construction spending data points decelerate a bit but just wondering if there's some pent up demand or has that been largely worked through at this point.
And I think that the west coast market on construction demand is is being driven by both public and and public demand that that that is still more wait and see but is definitely needed and in the current environment and the new administration.
And may well be on leased with you know with more with more.
More power with more acceleration and then on the private I'm on the private side or the non residential and industrial construction has remained very strong yeah. The other thing that we are looking at is it's just overall.
Okay and in terms of the emphasis on on construction and infrastructure oriented stimulus.
And in light of yesterday's and certification of of on the New administration, and and the determination and on the Senate and one of the things that that Oh, we were looking at and Senator Schumer and comments in October of 2019, when he was.
And when he introduced and was very supportive of and easy transition plan and and I think that that the infrastructure that will support the transition on <unk>.
Electric vehicles and is one that it's also very relevant on the west coast, and and and something that that there may be on higher probability for <unk>.
Great and then how much would you bake in for net working capital headwinds this year.
[noise], Hi, Hi, Michael as it is for US here well you know, we're not giving a you know a projection on net working capital headwind, but you're you're correct to point out that in a rising you know I think you're well on the like your question isn't the rising price environment.
You have you didn't really have a build of working capital. So we aim.
And to have ER and profitability on increases and profitability more than offset any build up and in working capital and you know what you did see and in her prepared remarks that we expect a positive and operating cash flow and the second quarter.
And you know under lighting by his abuse that we aim for you know whatever.
And profitability and.
For more than offset any any build and and and working capital and during the second quarter subjects and timing of shipments so.
That's certainly our target higher profit offsetting working capital Bill.
Okay. So maybe more specifically for that on your internal inventory Directionally, if I could ask what your what your plans on over the next couple of quarters.
Well, we know what we're doing.
Especially on on and on inventory, because we continue to total or inventory and you know.
Regularly so it's a question Oh body by Crusade, and sales there and muddy cooler.
Or inventories are you know they are within historical norms, but on a relatively low levels because of the tight supply market as you would expect so.
Well, we you know, we will look to see economic improvement and growth or supply and therefore growth or inventories, we hope to translate into higher sales volume.
As well so I think you know all can see it lists the judge.
You know, we certainly aim for increased profitability to more than offset working capital build and on leap two.
And positive operating cash flow I mean, I think you know as you look back as I know you do you'll see that over the last several years Weve outreach and.
Positive operating cash flow on an annual basis on an excess of 100 and always doors.
And we'd certainly you know going for the year aiming for but not take on performance, but you can and we'll have to see.
Got it appreciate the detail.
Oh.
Thank you and this was just a question answer session and I'd like to now turn the call back over to Taylor Lundgren for closing remarks.
Thanks, Shannon before concluding our call today I want to take a moment to share my perspective about the violent events and unfolded and the capital yesterday.
The United States serves as a beacon and democracy around the world.
And what happened yesterday were just struck and act.
Against our terrorist Democratic principal of a peaceful Kansas and the power.
It's time for us to move forward as one nation peacefully and respectfully and to rebuild our country and we recover from the devastating impact of the pandemic.
So as we begin and new year, let's commit and finding common ground on the issues that divide us.
And unite behind the shared values on line card democracy was founded.
I look forward to speaking with you again in April when we report our second quarter results.
And the interim stay safe and stay well.
Ladies and gentlemen, this concludes today's conference call. Thank you for participating you may now disconnect.
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