Q1 2025 Myers Industries Inc Earnings Call
To ask questions by pressing the star followed by one on your telephone keypad. If you change your mind. Please press star followed by cute.
Meghan Beringer: Also, please be advised that certain non-GAAP financial measures, such as the adjusted gross profit, adjusted operating income, adjusted EBITDA, and adjusted earnings per share may be discussed on this call.
Speaker Change: I'd now like to hand, you over to Meghan Beringer as senior director of Investor Relations at Myers industries to begin Meghan. Please go ahead when you're ready.
Meghan Beringer: Now, please turn to slide 5 of our presentation, as I will now turn the call over to Aaron.
Meghan Beringer: Thank you good morning, everyone and thank you for joining Myers conference call to review 2025 first quarter results.
Aaron Schapper: Thank you, Meghan. Good morning, everyone, and thank you for joining. On today's call, I will begin by reviewing first quarter highs. Then I'll provide an update on our focused transformation, our progress since our fourth quarter earnings call, and our unique characteristics that define Myers.
Meghan Beringer: And Meghan Beringer senior director of Investor Relations at Myers Industries.
Aaron Shopper: Joining me today are Aaron shopper, President and Chief Executive Officer.
Brad Pitt: Brad Pitt.
Brad Pitt: Executive Vice President and Chief Financial Officer.
Aaron Schapper: Following my comments, Grant will provide a detailed review of the first quarter financials, followed by Dan who will review our outlook for the year. First quarter revenue is flat year-over-year. Growth in material handling was led by the contribution of our signature acquisition and industrial growth for military products, offset by lingering softness in our distribution cycle. Margins improved as we did a nice job of controlling costs. SG&A, which is the focus of our 2025 cost savings program, was lower as a percent of sales, resulting in an increase in EPS. I am pleased with the team's focus and performance, and I am reassured by the solid start to the year.
Brad Pitt: And then home Vice President corporate controller.
Brad Pitt: After the prepared remarks, we will host a question answer session.
Brad Pitt: Earlier. This morning, we issued a press release outlining our first quarter financial results. We have also posted a presentation to accompany today's prepared remarks.
Brad Pitt: Both are available under the Investor Relations tab at Www Dot Myers industries Dot com.
Brad Pitt: This call is being webcast on our website and will be archived along with the transcript of the call. Shortly after this event. Please turn to slide three of the presentation for our Safe Harbor disclosures.
Brad Pitt: I would like to remind you that we may make some forward looking statements during this call.
Aaron Schapper: At the same time, there are clear opportunities to improve, and I am confident that we are on the right path to elevate our performance.
Brad Pitt: These comments are made pursuant to the safe Harbor provisions of the private Securities Litigation Reform Act of $19 95.
Aaron Schapper: Before moving on, I would like to address tariffs as they pertain to Myers Direct. Please turn to slide 6. Our supply chain is predominantly based in the U.S. Most of the materials we purchase are from U.S. suppliers. Fifteen of our 16 manufacturing plants are here in the U.S. More than 90 percent of our 2025 material handling revenue is expected to be manufactured in the U.S. Further, the remaining 10 percent of revenue from this segment is currently protected by the USMCA and military exemptions. For distribution, less than 15% of our products are sourced from China. We plan to use pricing to offset tariff costs and have secured secondary and tertiary suppliers to mitigate the impact to our customers.
Brad Pitt: Such statements are based on management's current expectations and involve risks uncertainties.
Brad Pitt: The uncertainties and other factors, which may cause results to differ materially from those expressed or implied in these statements.
Brad Pitt: Further information concerning these risks uncertainties and other factors are set forth in the company's periodic SEC filings.
Brad Pitt: Also please be advised that certain non-GAAP financial measures such as the adjusted gross profit adjusted operating income adjusted EBITDA and adjusted earnings per share may be discussed on this call.
Brad Pitt: Now please turn to slide five of our presentation as I will now turn the call over to Ann Thank.
Aaron Schapper: This predominantly domestic-based supply chain should provide resilience to tariff-driven disruptions. As a result, we expect minimal direct impact from the current tariff. We are also positioned to provide options for supply chain resiliency to our customers to help them mitigate these disruptions. Of course, this is a dynamic situation, and we continue to closely monitor any impact on factors that would alter end-market demand trends. We stand ready to execute across a wide variety of scenarios. Should we find ourselves in an altered landscape than we are currently expecting?
Ann Thank: Thank you Meghan good morning, everyone and thank you for joining us.
Ann Thank: On today's call I will begin by reviewing first quarter highlights then I'll provide an update on our focused transformation our progress since our fourth quarter's earnings call and our unique characteristics that define Myers.
Ann Thank: Following my comments grant will provide a detailed review of the first quarter financials, followed by Dan who will review our outlook for the year.
First quarter revenue was flat year over year growth in material handling was led by the contribution of our signature acquisition and industrial growth for military products offset by lingering softness in our distribution segment.
Aaron Schapper: Turning to slide 7, during our fourth quarter earnings call, I introduced our Focus Transformation Program. We are developing this plan to change course and accelerate our timeline to deliver more consistent and reliable results. During my conversation with employees, I'm encouraged with how they are embracing the positive cultural shift to elevate our performance.
Ann Thank: Margins improved as we did a nice job of controlling costs SG&A, which is a focus of our 2025 cost savings program was lower as a percent of sales, resulting in an increase in EPS I am pleased with the team's focus and performance and I am reassured by the solid start to the year.
Aaron Schapper: Let's review the four objectives and the early progress that we are achieving. The first objective is to establish a culture of execution and accountability to drive performance. We have adjusted our core values to include deliver results and continuous improvement, emphasizing a culture of lean management supported by clear, efficient processes. We align incentive plans with individual business unit performance while retaining overall executive accountability to shareholders for corporate targets. These changes provide proper incentives to demonstrate our core values, motivating employees to achieve organic growth and profitability in each of our businesses. I believe these actions will drive cultural change, igniting a fire in our employees and validating the opportunity that attracted me to Myers.
Ann Thank: At the same time, there are clear opportunities to improve and I'm confident that we're on the right path to elevate our performance.
Ann Thank: Before moving on I would like to address tariffs as they pertain to Myers directly please turn to slide six.
Ann Thank: Our supply chain is predominantly based in the U S. Most of the materials. We purchase are from U S suppliers 15, or 16 manufacturing plants are here in the U S more than 90% of our 2025 material handling revenue is expected to be manufactured in the U S. Further the remaining 10% of revenue from this segment is currently protected.
Ann Thank: By the U S MCA and military exemptions.
Ann Thank: Our distribution.
Ann Thank: And 15% of our products are sourced from China, we plan to use pricing to offset tariff costs and have secured secondary and tertiary suppliers to mitigate the impact to our customers.
Aaron Schapper: Our second objective is to create clear strategies, including action plans and specific KPIs to improve the profitability of our entire We're off to a rapid start. Over the past few weeks, we completed a series of employee workshops to review and evaluate the businesses in our portfolio, developing strategies for each based on their characteristics. Some of our businesses serve high-growth markets. We will invest to support these businesses to continually drive organic growth. We have other businesses serving lower-growth markets that do not require significant investments but generate strong cash flow to fund high-growth businesses and fortify our ability to return cash to shareholders.
Ann Thank: This predominantly domestic placed supply chain should provide resilience of tariff driven disruptions as a result, we expect minimal direct impact from the current tariffs.
Ann Thank: We are also positioned to provide options for supply chain resiliency to our customers to help them mitigate these disruptions.
Ann Thank: Of course this is a dynamic situation and we continue to closely monitor any impact on factors that would alter end market demand trends, we stand ready to execute across a wide variety of scenarios should we find ourselves in an altered landscape than we are currently expecting.
Aaron Schapper: Finally, we have a few businesses that are not performing at the level we expect. We are developing and implementing plans to improve these businesses within a reasonable time. I am optimistic that we are on the right path to drive improved performance across our entire portfolio.
Speaker Change: Turning to slide seven during our fourth quarter earnings call I introduced our focused transformation program. We are developing this plan to change course, and accelerate our timeline to deliver more consistent and reliable results. During my conversation with employees I am encouraged with how they are embracing the positive cultural shift to elevate our performance.
Aaron Schapper: We plan to announce our updated long-term strategy for each business by the end of this year after we complete the necessary foundational work.
Speaker Change: Let's review the four objectives and the early progress that we are achieving.
Aaron Schapper: Our third objective is to deliver consistent and reliable results by effectively controlling what we can control. The first step that we announced during our last quarterly update is to deliver annualized cost savings of $20 million by year-end 2025, primarily in SG&A, to reduce costs while enhancing operational efficiency. From my experience in managing business in dynamic markets, optimizing cost structure is vital during challenging markets and rewarding enough The workshops I mentioned earlier were instrumental in identifying specific actions to drive efficiencies into the organization to build a foundation for long-term sustainable growth. We overachieved our signature synergy targets, delivering $12 million in cost synergies against our $8 million target.
Speaker Change: The first objective is to establish a culture of execution and accountability to drive performance. We have adjusted our core values to include deliver results and continuous improvement emphasizing a culture of lean management supported by clear efficient processes.
Speaker Change: We are aligned incentive plans with individual business unit performance, while retaining overall executive accountability to shareholders for corporate targets.
Speaker Change: These changes provide proper incentives to demonstrate our core values motivating employees to achieve organic growth and profitability in each of our businesses.
Speaker Change: I believe these actions will drive cultural change igniting a fire in our employees and validating the opportunity that attracted me to Myers.
Speaker Change: Our second objective is to create clear strategies, including action plans and specific kpis to improve the profitability of our entire portfolio.
Aaron Schapper: We are confident in our continued path to our $20 million annualized cost savings commitment.
Aaron Schapper: Our fourth and final objective is to optimize cash flow and support disciplined capital allocation deployment. Last quarter, we launched a new $10 million share repurchase. In addition, we will continue to invest in organic growth, maintaining our capex target of around 3% of sales, and focusing on high growth opportunities that deliver superior return. It is early days on our focused transformation, but I'm pleased with the initial pace of progress and confident in our team's ability to deliver improved financial results from the changes we are making.
Speaker Change: We are off to a rapid start.
Speaker Change: Over the past few weeks, we completed a series of employee workshops to review and evaluate the businesses in our portfolio developing strategies for each based on their characteristics. Some of our businesses serve high growth markets. We will invest to support these businesses to continually drive organic growth, we have other businesses, serving lower growth markets that do not.
Speaker Change: Require significant investments, but generate strong cash flow to fund high growth businesses and fortify our ability to return cash to shareholders.
Speaker Change: Finally, we have a few businesses that are not performing at the level. We expect we are developing and implementing plans to improve these businesses within a reasonable timeframe.
Aaron Schapper: Our mission is to provide products that protect the world from the ground up.
Aaron Schapper: I'd like to discuss two examples of how we do this, beginning on slide eight. Many large stadiums with turf playing surfaces would like to expand the functionality of their properties and increase the revenue opportunity. This creates a challenge to properly protect the playing surface to eliminate damage that could lead the player into injury. In addition, the cost and time of converting the playing surface limits the revenue-generating potential. Our Omnideck flooring system provides a differentiated It is strong and durable, protecting the surface from machinery, staging, equipment, and foot traffic. It is lightweight, reducing the time and cost to repurpose the facility.
Speaker Change: I am optimistic that we're on the right path to drive improved performance across our entire portfolio. We plan to announce our updated long term strategy for each business by the end of this year. After we complete the necessary foundational work. Our third objective is to deliver consistent and reliable results by effectively controlling.
Speaker Change: What we can control.
Speaker Change: The first step that we announced during our last quarterly update is deliver annualized cost savings of $20 million by year end 2025, primarily in SG&A to reduce cost while enhancing operational efficiency.
Speaker Change: From my experience in managing business in dynamic markets optimizing cost structure is vital during challenging markets and rewarding in upswings.
Aaron Schapper: As a result, the integrity of the playing surface remains intact. We have seen great success from our customers with this product.
Aaron Schapper: I invite you to view the video linked in our presentation to see a testimonial from our newest customer, SoFi Stadium.
Speaker Change: The workshop that I mentioned earlier were instrumental in identifying specific actions to drive efficiencies into the organization to build the foundation for long term sustainable growth.
Aaron Schapper: Another example of our mission in action is shown on slide 9, protecting our troops. Historically, our militaries used wood or steel packaging for ammunition. These are heavy, increasing the cost of transport and the stress on soldiers that carry these containers.
Speaker Change: We over achieved our signature synergy targets delivering $12 million in cost synergies against our 8 million target. We are confident in our continued path to our $20 million annualized cost savings commitments, our fourth and final objective is to optimize cash flow and support disciplined capital allocation deployment last quarter, we launched.
Aaron Schapper: Our Scepter solution provides lighter, better, safer, and battle-proven packaging for transporting ammunition for the defense industry. Delivering a 41% weight savings, soldiers' injuries are reduced, keeping them healthier to train and accomplish their primary mission. In addition, the transportation costs are reduced, enabling the military to allocate resources to other critical areas.
Speaker Change: The new $10 million share repurchase plan. In addition, we will continue to invest in organic growth, maintaining our capex target of around 3% of sales and focusing on high growth opportunities that deliver superior returns.
Aaron Schapper: We are so proud to support, serve, and protect our troops.
Speaker Change: It is early days on our focused transformation, but I'm pleased with the initial pace of progress and confident in our team's ability to deliver improved financial results from the changes we are making.
Aaron Schapper: These examples highlight who we are as a company and how we deliver value to our customers.
Aaron Schapper: Since our last earnings call, we have made progress on achieving our commitments. We have acted quickly, starting the journey to create a culture built on accountability that fulfills our commitments and delivers results with a continuous improvement mindset. Building on this momentum, we are moving forward with purpose, transforming Myers with speed, agility, urgency, and acting with integrity. I will continue to meet with customers and investors, listening to your feedback to ensure we are creating value for you.
Speaker Change: Our mission is to provide products that protect the world from the ground up.
Speaker Change: I'd like to discuss two examples of how we do this beginning on slide eight.
Speaker Change: Many large stadiums, which hurt playing surfaces would like to expand the functionality of the properties and increase the revenue opportunity. This creates a challenge to properly protected playing serviced eliminate damage that could lead to player injuries. In addition, the cost and time of converting the playing surface limits the revenue generating potential of our omni that flooring.
Grant Fitz: With that, I'll turn the call over to Grant to discuss our first quarter results.
Speaker Change: System provides a differentiated solution. It is a strong and durable protecting surface from machinery staging equipment and foot traffic. It is lightweight reducing the time and cost to repurpose the facility as a result, the integrity of the playing surface remains intact.
Aaron Schapper: As previously announced, Grant will be stepping down as our CFO tomorrow. I wish to thank him publicly on behalf of the entire company. Although our time working together was short, I recognize the contribution he has made here since joining the organization, and I'm grateful for the help he has provided to me during my transition. He will be missed, and we wish him all the best.
Speaker Change: <unk> seen great success from our customers with this product I invite you to view the video linked in our presentation to see a testimonial for our newest customers sulfide stadium.
Grant Fitz: Dan Hohn, Vice President, Corporate Controller, will serve as interim CFO while we undergo a formal search, which has been launched to identify our next finance... Over to you, Grant. Thank you Aaron for those kind words and good morning everyone.
Speaker Change: Another example of our mission and action as shown on slide nine protecting our troops historically, our military use water steel packaging for ammunition. These are heavy increase in the cost of transport in the stress on soldiers that carry these containers in the field our sector solution provides lighter better safer and battle.
Grant Fitz: I am proud of what we have accomplished during my time at Myers and I truly believe the organization is heading in the right direction as our focus transformation program is already showing signs of improvement. I look forward to following Myers' future success.
Speaker Change: Reuven packaging for transporting ammunition for the defense industry.
Grant Fitz: Turning to our financial results in slide 11, first quarter net sales of $206.8 million were essentially flat year-over-year as growth in material handling, led by the impact of our signature acquisition, was offset by lingering softness in our distribution segment. As a reminder, signature was closed on February 8th of last year. This will be the last quarter we will call out its inorganic contribution to year-over-year performance. We expanded adjusted gross margin 80 basis points to 33.5 percent, driven largely by the acquisition of signature and favorable product mix. Adjusted operating income improved to 18.7 million dollars, with margin improving 100 basis points to 9 percent of sales.
Speaker Change: Delivering a 41% weight savings soldiers injuries are reduced keeping and healthier to train and accomplished our primary mission. In addition, the transportation costs will reduce enabling the military to allocate resources to other critical areas. We are so proud to support serve and protect our troops.
Speaker Change: These examples highlight who we are as a company and how we deliver value to our customers.
Speaker Change: Since our last earnings call, we have made progress on achieving our commitments. We have acted quickly starting the journey to create a culture built on accountability that fulfills our commitments and delivered results with a continuous improvement mindset.
Speaker Change: Building on this momentum we are moving forward with purpose transformed Myers with speed agility urgency and acting with integrity I will continue to meet with customers and investors listening to their feedback to ensure we are creating value for you.
Grant Fitz: We also reduced SG&A expenses for the quarter. We will begin to see our focused transformation work deliver further SG&A run rate savings next quarter and through the balance of the year. Adjusted EBITDA margin also improved, expanding 170 basis points. Diluted adjusted earnings per share were $0.22 compared to $0.21 in 2024 on improved operating income partially offset by higher net interest expense.
Speaker Change: With that I will turn the call over to grant to discuss our first quarter results as previously announced grant will be stepping down as our CFO tomorrow.
Speaker Change: I wish to thank them publicly on behalf of the entire company, although our time working together, we're short I recognize the contribution he has made here since joining the organization and I'm grateful for the help he has provided to me during my transition he will be missed and we wish him all the best <unk> Vice President corporate controller will serve as interim.
Grant Fitz: Turning to slide 12, net sales for material handling increased 3.6 percent compared to the prior year, primarily due to the contribution from the signature acquisition. Industrial sales were stronger, primarily for military applications. We saw cyclical softness in food and beverage for seed box demand. Material handling's adjusted EBITDA increased 11.7% to $36.3 million, resulting in a 160 basis point increase in adjusted EBITDA margin to 23%. These improvements were attributed largely to our increased signature product mix and our ability to effectively reduce SG&A and manufacturing costs.
Speaker Change: I'm CFO, while we undergo a formal search which has been launched to identify our next finance chief overview graph.
Speaker Change: Thank you Erin for those kind words and good morning, everyone. I am proud of all we have accomplished during my time at Myers and I truly believe the organization is heading in the right direction as our focused transformation program is already showing signs of improvement I look forward to following Myers future success.
Speaker Change: Turning to our financial results on Slide 11, first quarter net sales of $206 $8 million were essentially flat year over year as growth in material handling led by the impact of our signature acquisition was offset by lingering softness in our distribution segment. As a reminder, signature was closed on February eight of last year.
Grant Fitz: Distribution net sales decreased 10.3% on lower volume and pricing. Adjusted EBITDA decreased to $0.5 million primarily due to lower gross margin, partially offset by lower SG&A due to an improved cost structure resulting from our distribution center consolidation.
Speaker Change: This will be the last quarter, we will call out is inorganic contribution to year over year performance. We expanded adjusted gross margin 80 basis points to 33, 5% driven largely by the acquisition of signature and favorable product mix adjusted operating income improved to $18 $7 million with margin.
Grant Fitz: Turning to slide 13. Operating cash flow was lower this quarter on an increase in working capital due to accounts receivable timing and a build-in inventory as we took some proactive action before the tariff details were announced. We expect working capital to improve in future quarters. We allocated $8.1 million to CapEx as we continue to invest in organic growth. We maintain total equality of $267 million, including $231.7 million of availability under a current revolving credit facility and cash on hand of $35.3 million, providing us with additional flexibility to support our capital allocation priority.
Speaker Change: Improving 100 basis points to 9% of sales. We also reduced SG&A expenses for the quarter. We will begin to see our focused transformation work deliver further SG&A run rate savings next quarter and through the balance of the year.
Speaker Change: Adjusted EBITDA margin also improved expanded 170 basis points diluted adjusted earnings per share was <unk> 22.
Grant Fitz: Please turn to slide 14. As Aaron mentioned, we repurchased $1 million in shares under our share repurchase program announced last quarter. There remains $9 million under this authorization, and we plan to continue making opportunistic purchases to complement our ongoing dividends as we return cash to shareholders. That was essentially flat for the quarter, with our net leverage ratio at 2.8 times. As mentioned before, we are targeting a ratio of 1.5 to 2.5 times.
Speaker Change: Compared to 21 and 2020 for an improved operating income partially offset by higher net interest expense.
Speaker Change: Turning to slide 12, net sales for material handling increased three 6% compared to the prior year, primarily due to the contribution from the signature acquisition.
Speaker Change: Industrial sales were stronger primarily for military applications, we saw cyclical softness in food and beverage perceive box demand.
Speaker Change: <unk> adjusted EBITDA increased 11, 7% to $36 $3 million, resulting in a 160 basis point increase in adjusted EBITDA margin to 23%. These improvements were attributed largely to our increased signature product mix and our ability to effectively reduce SG&A and manufacturer.
Dan Holm: At this time, I will now turn the call over to Dan to review our current 2025 outlook. Dan? Thank you, Grant. And let me also wish you well. As we did during our last quarterly update, we are sharing some high-level qualitative expectations for the year, which are shown on slide 16. We see both risks and opportunities for the businesses and will continue to monitor and market conditions for impacts from tariffs or other factors that may influence demand trends.
Speaker Change: Cost.
Speaker Change: Distribution net sales decreased 10, 3% on lower volume and pricing adjusted EBITDA decreased to <unk> 5 million.
Speaker Change: Primarily due to lower gross margin, partially offset by lower SG&A due to an improved cost structure, resulting from our distribution center consolidation.
Dan Holm: Let me review our expectations by market. Industrial should continue with moderate growth driven by global inventory replenishment for military applications and to a lesser extent for bulk container and organizational products. In infrastructure, ongoing strong project spending supported by material conversion from wood matting should continue to support strong growth.
Speaker Change: Turning to slide 13.
Speaker Change: Operating cash flow was lower this quarter on an increase in working capital due to accounts receivable timing and a build in inventory as we took some proactive action before the tariff details were announced we expect working capital to improve in future quarters, we allocated $8 $1 million to Capex as we continue to invest in organic.
Dan Holm: We now expect the vehicle and market, which includes RV and Marine, to be down as a result of economic uncertainty driven by developing tariff impacts. We previously expected this end market to be stable to down. In consumer, we anticipate stable sales of fuel containers and an expected return to a more normalized storm. Our food and beverage end market, including agriculture, is projected to be stable. Automotive aftermarket distribution is expected to be slightly down. We are working to stabilize this business as we improve our cost structure, sales territory alignment, and digital sales strategy. We will continue to look for opportunities to expand our market presence and deliver solutions to our customers.
Speaker Change: <unk> growth, we maintained total liquidity of $267 million, including $231 7 million of availability.
Speaker Change: Ability under our current revolving credit facility and cash on hand of $35 3 million, providing us with additional flexibility to support our capital allocation priorities.
Speaker Change: Please turn to slide 14.
Speaker Change: Aaron mentioned, we repurchased $1 million in shares under our share repurchase program announced last quarter. The remains $9 million under this authorization and we plan to continue making opportunistic purchases to complement our ongoing dividend as we return cash to shareholders.
Dan Holm: At the same time, we expect financial results to improve as we make progress on our focused transformation.
Speaker Change: That was essentially flat for the quarter with our net leverage ratio at two eight times as mentioned before we are targeting a ratio of one five to two five times.
Aaron Schapper: I would now like to turn the call back to Aaron for some closing comments before we take your questions. Thank you, Dan. Our team at Myers is aware of the significant work that needs to take place to achieve our potential. We are moving forward with urgency to execute our focus transformation, which includes supporting and growing Myers' uniquely differentiated products, which protect the world from the ground up. Right-sizing the organization to optimize our cost structure and support our growth initiatives with a continuous improvement mindset will enable us to work smarter and more efficiently. And supporting a balanced capital allocation framework that invests in growth while returning cash to the shareholders.
Speaker Change: At this time I will now turn the call over to Dan to review, our current 2025 outlook Dan. Thank.
Dan: Thank you, Greg and let me also wish you well.
Dan: As we did during our last quarterly update we are sharing some high level qualitative expectations for the year, which are shown on slide 16.
Dan: We see both risks and opportunities for the businesses and we'll continue to monitor end market conditions for impacts from tariffs or other factors that may influence demand trends.
Dan: Let me review our expectations by market.
Aaron Schapper: I continue to be excited about the opportunities to improve performance and create value for our customers, employees, and shareholders.
Dan: Industrial should continue as moderate growth driven by global inventory replenishment for military applications and to a lesser extent for bulk container and organizational products and infrastructure ongoing strong project spending supported by material conversion from wood matting should continue to support strong growth.
Operator: With that, I'd like to turn the call over to the operator for questions, operator. Thank you.
Operator: We will now begin the question and answer session. If you'd like to ask a question, please press star followed by one on your telephone keypad. If you change your mind, please press star followed by two.
Dan: We now expect the vehicle end market, which includes RV and marine to be down as a result of economic uncertainty driven by developing tariff impacts. We previously expected this end market to be stable to down in.
Operator: When preparing to ask your question, please ensure your device is unmuted locally. We will make a quick pause here for the questions to be registered.
Dan: In consumer we anticipate stable sales of fuel containers, and an expected return to a more normalized storm season.
Dan: Our food and beverage end market, including agriculture is projected to be stable.
Christian Zyla: And our first question comes from Christian Zyla with KCorp. Morning, everyone. Grant, it's been wonderful working with you and it's been good to be here. We wish you all the best in the future. Thanks so much, Christian. Likewise, it's been great to work with the KeyBank team. First question for me, just generally, thanks for the additional tariff detail on the distribution business. If I recall, there are a couple of facilities in Central America, are those subject to tariffs? And then how price sensitive are your customers here if you raise price to offset the tariff costs you mentioned?
Dan: Automotive aftermarket distribution is expected to be slightly down we are working to stabilize this business as we improve our cost structure sales territory alignment and digital sales strategy.
We will continue to look for opportunities to expand our market presence and deliver solutions to our customers at the same time, we expect financial results to improve as we make progress on our focused transformation.
Eric: I'd now like to turn the call back to Eric for some closing comments before we take your questions.
Speaker Change: Thank you Dan our team at Myers is aware of the significant work that needs to take place to achieve our potential we are moving forward with urgency to execute our focused transformation, which includes supporting and growing Myers uniquely differentiated products, which protect the world from the ground up.
Aaron Schapper: Would you expect to see a volume offset in any of your business? So the Central America piece is a relatively small part of the distribution business. So while there is some impact of tariffs like there is in the rest of the world, we don't expect that to have a material effect on buyers. But I think for our price sensitive standpoint, of course our customers are always looking for the best value that we can get, and it's our job to make a profit on products that we're selling. If we need to push price, we will. Yeah, I would just add too, Christian, on that is that we do have, you know, we talked a little bit in the opening comments that we are looking as well too for alternative suppliers where we think that there's some value to do that.
Speaker Change: Right sizing the organization to optimize our cost structure and support our growth initiatives with a continuous improvement mindset will enable us to work smarter and more efficiently and supporting a balanced capital allocation framework that invest in growth, while returning cash to the shareholders.
Speaker Change: I continue to be excited about the opportunities to improve performance and create value for our customers employees and shareholders with that I'd like to turn the call over to the operator for questions operator.
Speaker Change: Thank you we will now begin the question and answer session.
Speaker Change: Ask your question. Please press star followed by one on your telephone keypad. If you change your mind. This press star followed by <unk>.
Speaker Change: Turning to ask a question. Please ensure your devices on mute locally who will make a quick pause here for the questions to be registered.
Aaron Schapper: And so I think overall, you know, echoing on Dan's comments, we feel we're in a pretty good position and we don't see, particularly in the distribution business, having a significantly different footprint of supply than what we would see with other competitors. And we feel we're in a pretty good position on working with our suppliers and also leveraging price as needed. Got it, understood.
Speaker Change: And our first question comes from Christian <unk>.
Speaker Change: Hey Clarke.
Speaker Change: Good morning, everyone.
Grant Fitz: And then on free cash flow for the quarter, can you just walk through why that was so low year over year? And then just bigger picture, correct me if I'm wrong, but history suggests 15 to 20 million of free cash flow per quarter should be achievable in a steady run rate for you guys. Is that how you think about the business or just any broader thoughts on that? Thank you. Sure, Christian, this is Grant. I'll take this one. I think Q1 was a little bit different than what we've typically seen within Myers. As you know, we typically have some very good operating cash flow with the business.
Speaker Change: Greg it's.
Speaker Change: Christian.
Speaker Change: Sure we will.
Speaker Change: Wish you all the best in the future.
Speaker Change: Thanks, So much Christian likewise, it's been great to work with the Keybanc team.
Speaker Change: Yes.
Speaker Change: First question for me just generally thanks for the additional tariff detail on the distribution business. If I recall there are a couple of facilities in Central America are those subject to tariffs and then how price sensitive are your customers here. If you raise price to offset the tariff cost you mentioned would you expect to see a <unk>.
Speaker Change: Offset in any of your business.
Grant Fitz: And essentially, we had two things that occurred in this quarter. The first one was that we had a very strong march, particularly with Signature and our Scepter business. And so we just have some timing of accounts receivable on when those will actually be collected as those sales were driven more towards the end of the month. And then the second thing is that as we were looking at the potential tariff impacts, we also looked at doing some opportunistic buys on inventory ahead of potential tariffs. And so those two items really created a situation where we have a lower than typical historic free cash flow for the business.
Speaker Change: So the central.
Speaker Change: Erika pieces is a relatively small part of the distribution business. So while there is some impact of tariffs like libraries and the rest of the world. We don't expect that to have a material effect on Myers.
Speaker Change: From a price sensitive standpoint of course, our customers are always looking for the best value that we can get and it's our job.
Speaker Change: It's our job to.
Speaker Change: To make a profit.
Speaker Change: Products that we're selling so.
Speaker Change: If we need to push price we will.
Aaron Schapper: We do anticipate that's going to recover throughout the year as we see this continuing. And I wouldn't say that we have any changes in terms of the pattern of the free cash flow that we would typically generate for the year and certainly think that we're in a very good position. I think, quite frankly, that's one of the real attractiveness to Myers, is just the ability for it to generate cash. Yeah, Christian, I would just add that we're pretty happy. You know, we remember the Section 301 tariffs when they came out back in 2018. And our team really was very proactive in making sure that we had what we needed to mitigate any of the tariff pieces.
Christian: Just to add to Christian on that is that.
Speaker Change: We do have.
Christian: We talked a little bit on the <unk>.
Christian: Opening comments that we are looking as well to for alternative suppliers, where we think that there is some value to do that and so I think overall echoing on Dan's comments, we feel we're in a pretty good position and we don't see particularly in the distribution business, having a significantly different footprints of supply than what we would see with other competitors.
Christian: We feel were pretty good position on.
Christian: Working with our.
Christian: With our suppliers and also leveraging price as needed.
Speaker Change: Got it understood.
Aaron Schapper: And, you know, sometimes there's bits and pieces that you have to get. And I think they did a great job of getting that inventory in early, just remembering, you know, some of the other tariff shocks. So we moved quickly and got things in so that we could make sure we mitigate price and make sure that our customers are taken care of. So we're in pretty good shape from that standpoint. Great.
Speaker Change: And then on free cash flow for the quarter can you just walk through why that was so low year over year, and then just bigger picture.
Speaker Change: If I am wrong, but history suggests $15 million to $20 million of free cash flow per quarter should be achievable on a steady run rate for you guys is that how you think about the business or just any broader thoughts on that thank you.
Speaker Change: Sure Kristina This grant I'll take this one.
Christian Zyla: And last one for me, and then I'll pass it back.
Speaker Change: Q1 was a little bit different than what we've typically seen within Myers as you know we typically have some very good operating cash flow with the business.
Christian Zyla: This is just a joint question for Signature and Scepter as it relates to military. Have you seen any additional uptake in orders or qualification activities for your products in either of those businesses? And then for Scepter's ammunition containers, are you still projecting $40 million this year from that contract?
Speaker Change: And essentially we had two things that are.
Speaker Change: That occurred in this quarter.
Speaker Change: First one was is that we had a very strong march, particularly with signature in our scepter business and so we just have some timing of accounts receivable on when those will actually be collected as those sales were driven more towards the end of the month and then the second thing is is that as we were looking at the potential tariff impacts.
Aaron Schapper: And then what are your thoughts for 26 and beyond for that? Thank you so much. Uh, yeah, we're very happy with the order flow and, um... you know, both Scepter and Signature. So if you're looking at both new customers and new opportunities, I would say that we have sold in both of those areas. We're very happy with the growth of that, the business is performing well. The customers, we have good relationship with the customers, we're very close. So we anticipate both of those businesses to have strong growth going not only into this year, but looking into next year, we'll be looking at the capital that those businesses need to continue to grow and we'll make sure that they're funded.
We also looked at doing some opportunistic buys on inventory ahead of potential tariffs and so those two items really created the situation, where we have a lower than typical historic our free cash flow for the business. We do anticipate that is going to recover throughout the year as we see this.
Speaker Change: And I want to say that we have any changes in terms of the pattern of the free cash flow that we would we would typically generate for the year and certainly think that we're in a very good position and I think quite frankly, that's one of the real attractiveness is attractive.
Aaron Schapper: We're looking at what more we can do in other areas, especially in Europe on the Scepter side to see the growth that we get there as well as Signature. So not only do we have opportunities to grow here domestically on our footprint, but we have also opportunities in Europe to grow there as well.
Speaker Change: Mr. Myers is just the ability for it to generate cash.
Christian: Yes Christian.
Speaker Change: Add that we're pretty happy.
Speaker Change: We remember the section 301 tariffs when they came out back in 2018, and our team really was very proactive in making sure that we had what we needed.
Christian Zyla: So we're pretty excited about the future of those two businesses in particular. Great, thanks. Again, looking forward to working with you. Likewise, Christian.
Speaker Change: To mitigate any of the tariff pieces and sometimes there is bits and pieces that you have to get it I think they did a great job of getting that inventory in early just remembering.
Speaker Change: Some of the other tariff shops, so we moved quickly.
Speaker Change: <unk> got things and so that we can make sure we mitigate price and make sure that our customers are taken care of so we're in pretty good shape from that standpoint.
William Dezellem: And our next question comes from William Dezellem with Teotihuacan Cocteau Management. Thank you. I have two questions.
Speaker Change: Great and last one for me and then I'll pass it back.
Aaron Schapper: First of all, relative to the vehicle group, now forecasting that to be Yeah, so kind of let's take it in two parts. First, I take RV, marine, kind of the more recreational vehicle part. I mean, there remains a lot of hesitancy and caution among our customer base on that side. There's a lot of tariff uncertainty right now. And, you know, when people are looking at potential inflationary pressures, and then sustained, perhaps sustained high interest rates, or at least not coming back down as fast as they normally or at least as projected on a dot plot earlier in the year.
Speaker Change: This is just a joint question for signature and sector as it relates to military have you seen any additional uptick in orders or qualification activities for your products in either of those businesses and then for scepter ammunition containers are you still projecting $40 million. This year from that contract and then what are your thoughts for 2006 and beyond for that thank you so much.
Speaker Change: <unk>.
Speaker Change: Yeah, we're very happy with the order flow and.
Speaker Change: Yes, both sector and signature so if youre looking at both new customers and new opportunities I would say that we have felt within both of those areas, we're very happy with.
Speaker Change: The growth of that business is performing well.
Speaker Change: The customers.
Speaker Change: We have good relationship with our customers. We're very close so we anticipate both of those businesses to have strong growth going not only into this year, but looking into next year.
Speaker Change: We'll be looking at the capital that those businesses need to continue to grow and we will make sure that they are funded.
Speaker Change: Looking at what more we can do in other areas, especially in Europe on the software side to see the growth that we get there as well as signature so not only do we have opportunities to grow here domestically our footprint, but we have also opportunities in Europe to grow there as well so we're pretty excited about the future of those two.
Aaron Schapper: um you know it creates a lot of uncertainty on that side so you know in general a lot of RV and marine products are financed so when there's high interest rates it makes it a lot harder for people to know hey how all in they're going to go so really it's that kind of economic uncertainty right now that really affects the marine and RV spending so at this point our customers are not really sure what the rest of the year is going to look like therefore they're just there's kind of like a wait and see kind of approach so that's why um you know from our projections we thought well that's going to be a wait and see is going to affect us so that's why we project that market to not be as strong as we had in this particularly in the last call where things were looking up that has definitely been a change since the tariffs were announced um so around that uncertainty and then what it uh reflects automotive sides and uh parts that we do for the automotive side well i mean that's been pretty well um covered on what's going on the automotive side with the tariffs and everything else so once again until we caution hesitancy a lot of uh a lot of pieces and parts uh are um you know they're working out the taxes they're working out the tariffs so until we kind of get some stability and calmness where people actually know what all the tariff landscape is going to look like you're going to see some ebb and flow on that side as well so right now everyone's kind of waiting for some policy uh with the state firming up on the tariff side and then i think then that'll release but um in the meantime those are the two those are the two really hesitant and uncertain i mean people have had a really hard time forecasting what that's going to be right now so just being transparent on what we see out in the market today That is that is helpful.
Businesses in particular.
Speaker Change: Okay.
Speaker Change: Great. Thanks, Hey, Dan I'm looking forward to working with you.
Dan Myers: Likewise Christian.
Speaker Change: And our next question comes from William Li.
Speaker Change: Todd Capital management.
Dan Myers: Okay.
Dan Myers: Hi, Thank you I have two questions first of all relative to the to the vehicle group.
Dan Myers: Now forecasting that.
Dan Myers: Okay.
Dan Myers: Okay apologies my headset just one died so the.
Dan Myers: Vehicle group.
Dan Myers: For perspective, turning down is that specific to.
Dan Myers: RV Marine.
Dan Myers: The auto components business is it is it tied to something changing in the economy.
Speaker Change: Can you provide more detail behind kind of that change in outlook. Please.
Speaker Change: Yes, so let's take it in two parts first I'd take RV marine kind of more recreational vehicle part I mean, there remains a lot of hesitancy and caution among our customer base on that side, there's a lot of tariff uncertainty right now.
Speaker Change: And when people are looking at potential inflationary pressures and then sustained perhaps first and high interest rates or at least not coming back down as fast as they normally or lease as projected on adopt block earlier in the year.
Speaker Change: It creates a lot of uncertainty on that side. So in general a lot of RV and marine products are financed so when there is high interest rates. It makes it a lot harder for people to know how all of them, they're going to go so really it's that kind of economic uncertainty right now that really affects the marine.
Aaron Schapper: And do you sense that your RV marine customers that they have chosen to lower inventory, particularly let their dealers clear their lots a bit? Or, or is it something just more generic that they're in a bit of a pause mode due to not knowing? Yeah, I think it's the latter where they're kind of in a bit of a pause mode and trying to figure out which way to go. We have heard some that are looking to idle, some of our customers looking at idle plants, but at this point, everyone is very much in a listen and learn mode and trying to understand, you know, a lot of people talking to each other, trying to understand where the economy is going for this side.
Speaker Change: And RV spending so at this point.
Speaker Change: Our customers are not really sure.
Speaker Change: What the rest of the year is going to look like therefore.
Speaker Change: They're just they're kind of like a wait and see kind of approach. So that's why from.
Speaker Change: From our projections, we thought well that's going to be a wait and see is going to affect us. So that's why we project that market to not be as strong as we add and this is particularly in the last call where things were looking up that has definitely been a change since the tariffs were announced.
Speaker Change: So around that uncertainty and then.
Speaker Change: Reflects automotive side and the parts that we do for the automotive side, well I mean, that's been pretty well.
Aaron Schapper: So I think at this point, it's kind of it's a pause situation. I haven't heard anything specifically other than that. And, you know, there's talk about what they're going to do in the idling, what they're not going to do. But at this point, we haven't heard anything specific.
Speaker Change: Covered on what's going on in the automotive side with the tariffs and everything else. So once again until we caution hesitancy a lot of a lot of pieces and parts.
Speaker Change: Our.
Speaker Change: We're working up the taxes are working out the tariffs so until we kind of get some.
William Dezellem: Great, that's helpful.
Aaron Schapper: And then relative to the distribution business, as you've taken some time here to learn this business, Aaron, what do you believe is needed to turn the business given the circumstances it finds itself in today? Well, the distribution business, I'm still learning that business. You know, it's a different business. It's very much a service and sales business. It's incredibly important to be close to our customers on that side and understand what our customers need. And, you know, your customers needs change over time and business evolve over time. I think it's really important to look at where we are from a sales organization and, you know, the services we provide to our customers and, A, make sure that we're providing the right service that our customer needs and, B, making sure that we create value when we're offering those services and then we get paid according to that value.
Speaker Change: Stability and Congress, where people actually know what all the tariff landscape is going to look like youre going to see some ebb and flow on that side as well so right now everyones kind of waiting for some policy.
Speaker Change: A firming up on the tariff side, and then I think that will release, but in the meantime, those are the two those are the two really hesitant and uncertain. I mean people have had a really hard time forecasting what thats going to be right now so just.
Speaker Change: Being transparent on what we see out in the market today.
Speaker Change: And that is that is helpful and do you sense that your.
Speaker Change: RV marine customers that they have chosen to.
Speaker Change: Lower inventory.
Particularly.
Speaker Change: They are dealers clear their lots a bit or.
Speaker Change: Hum.
Speaker Change: Or is it something just more generic.
Speaker Change: They're in a bit of a pause mode due to not knowing.
Speaker Change: Yes, I think it's the latter where theyre kind of in a bit of a pause mode and trying to figure out which way to go we had heard some that are looking to idle some of our customers looking at idled plants, but at this point everyone is very much in a listen and learn mode and trying to understand a lot.
Aaron Schapper: So at this point, it's still early for me. I'm learning that business. I have a lot more customer visits I really want to talk to, a lot more of our customers to understand and make sure that we're matching our service with their needs and making sure that we add value. So I think it's a little early.
Speaker Change: People talking to each other trying to understand the.
Aaron Schapper: It's a really, it's a great question, William, and I appreciate the question. And I hope that on the next time we speak, that I'll have a lot more information for me for what our customers need and making sure that we match that.
We're.
Speaker Change: Kind of where the economy is going so this side. So I think at this point, it's kind of it's a pause situation I haven't heard anything specifically.
Speaker Change: Other than that and.
Speaker Change: There is talk about.
William Dezellem: Great, thank you.
Speaker Change: What they're going to do in the idling, what they are not going to do but at this point, but we haven't heard anything specific.
Grant Fitz: And Grant, thank you for all the time you've spent with us over the last couple of years and the very best of luck in whatever the next chapter brings for you. Well, thanks so much, Bill. It's been great to work with you and Matt as well, too.
Speaker Change: Great. That's that's helpful and then relative to the distribution business.
As you've taken some time here to learn this business here in <unk>.
Speaker Change: Do you believe is needed to to turn the business.
Speaker Change: Given the.
Operator: Just as a reminder, if you'd like to ask a question, please press star followed by one on your telephone keypad.
Speaker Change: The circumstances it finds itself in today.
Speaker Change: Well the distribution business I'm still learning that business.
Carolina Jolly: And our next question comes from Anna C. Jolly with Goverly and Company.
Speaker Change: No.
Speaker Change: It's a different business. It is very much a service and sales business.
Carolina Jolly: Good morning, it's Carolina from Gabelli. Thanks for taking my question. Just first, it's been about a little over a year since you acquired Signature. Can you just talk now that you've had that year under your belt, kind of what's worked, what hasn't, any learnings you've found from the acquisition? Yeah, I mean, I'll take that one. Good morning, Caroline. It's great to hear to your voice here. Signature has been a really good acquisition for Myers. It, you know, as we've talked before, it's very much been on the business case that we had put together when we first acquired the business.
Speaker Change: It's incredibly important to be close to our customers on that side and understand what our customers' needs are and your customers' needs change over time and business evolve over time I think is really important to look at where we are from.
Speaker Change: From a sales organization and.
Speaker Change: The services, we provide to our customers and make sure that we're providing the right service that our customer needs and be making sure that.
Speaker Change: We create values when we're offering those services and then we get paid according to that value.
Speaker Change: So at this point.
Speaker Change: It's still early for me I'm learning that business I have a lot more customer visits.
Aaron Schapper: And in fact, you know, one of the things that I think we've learned from this is that Signature had a lot to offer to our business in terms of just some of the processes and the way that they've run some of the, some of their operations. And so we've really had some good, good learnings on both sides where Signature has gotten some improvements with some uptime on some of their equipment through some of the expertise that we've had in our core businesses. And likewise, we've been able to leverage some of the Signature learnings into our core businesses for similar types of improvements.
Speaker Change: We want to talk to a lot more of our customers to understand and make sure that we're matching our service level of their needs and making sure that we add value. So I think it's a little early it's a really great question William.
Speaker Change: Hi.
Speaker Change: I appreciate the question and I hope that on the next time, we speak that will have a lot more information formula for what our customers need and making sure that we matched that.
Speaker Change: Great. Thank you and grant.
Aaron Schapper: And just in general, their whole business management system has really been something that we've been really leveraging throughout the company. The other thing that was interesting, we did talk about the synergies. We've achieved $12 million of synergies with the business, which is better than the $8 million that we had initially anticipated. It's been driven by a mix of some of the things I talked about, as well as we've got some additional resin savings than what we had originally anticipated. And so we feel very strong about the business. It's in a very good end market as well, too, with a lot of good upside potential.
Thank you for all the time, you've spent with us over the.
Speaker Change: Last couple of years and.
Speaker Change: Best of luck in whatever the next chapter brings for Ya.
Speaker Change: Well. Thanks, so much bill it's been great to work with with you amount as well too so.
Speaker Change: Just as a reminder, if you'd like to ask a question. Please press star followed by one on your telephone keypad.
Speaker Change: And our next question comes from Pharmacy, Johnny lead.
Speaker Change: Gabelli and company.
Aaron Schapper: And I think culturally, it's fitting very well with Myers as well. I do think that from just overall learnings, every acquisition is another opportunity for us to learn, and we continue to build on that. And Caroline, I'll just add from my standpoint, you know, it's a it's a great culture, it's a great sales team, it's a great operational team. And so, you know, as we work through integration, the learnings from Signature and the learnings from one another about how we do things just helps the whole. And, you know, when you have a really good culture coming in and integrating, it really just makes Myers a stronger business.
Speaker Change: Good morning, it's Carolinas from Gabelli Thanks for taking my question.
Speaker Change: Just first.
Speaker Change: And then about a little over a year since you acquired signature can you just talk now that you've had that year under your belt kind of what's works.
Speaker Change: But has any learning <unk> talent acquisition.
Speaker Change: Yeah, maybe I'll take that one good morning carefully and it's great to hear your voice here.
Speaker Change: E signature has been a really good acquisition for Myers.
Speaker Change: As we've talked before it's very much been on the business case that we had put together when we first acquired the business and in fact, one of the things that I think we've learned from this is the second <unk> had a lot to offer to our business in terms of just some of the processes and the way that they have on some of the some of their operations and so we've really had some goods.
Aaron Schapper: So, I think we're quite happy with the Signature acquisition, and we're quite happy to have the Signature team with Myers, and we'll continue to be able to leverage more from what they bring to the table.
Speaker Change: Learnings on both sides where signatures.
Aaron Schapper: Perfect, thanks. And then just a last second question. In the press release, you discussed pricing on the material handling segment. Can you just elaborate a little bit on the decisions around pricing? So, the pricing, I'm sorry, Carolyn, so you're asking about pricing in the material handling segment, correct? Yes. So we did take some strategic spots where we adjusted our pricing to make sure that we were more competitive in the market and to drive volume. Yeah, again, Carolina, we've been, you know, we Okay. Thanks, Carolina. I was just going to say we've been very active on just making sure, and particularly in our agri-mills area and buckhorn area, that we've been going after any competition that we've had in those areas, and I think we've been very successful with that.
Speaker Change: He has got some.
Speaker Change: Improvements with some uptime on some of their equipment through some of the expertise that we've had in our core businesses and likewise, we have been able to leverage some of the signature learnings into our core businesses for similar types of of improvements and just in general their whole business management system has really been something that we've been really leveraging throughout the company.
Speaker Change: The other thing that it was.
Speaker Change: Interesting, we did talk about the synergies.
Speaker Change: We we've achieved $12 million of synergies with the business, which is better than the $8 million that we had initially anticipated it's been driven by a mix of some of the things I talked about as well as we've got some additional resin savings.
Speaker Change: What we had originally anticipated.
Speaker Change: So we feel very strong about the business. It's been a very good end market as well too with a lot of good upside potential and I think the <unk>.
Speaker Change: Culturally, it's been done very well with Myers as well I do think that from.
Speaker Change: Just overall learnings every acquisition is another opportunity for us to learn and we continue to build on that.
Aaron Schapper: But, you know, and just once again, kind of going back to that, is, you know, our customers you know, they pay for value. And it's really important that when we're going through and we're looking at pricing, that we are pricing to the value that we're we're giving. And so I think, you know, that we've had good gross margins and a lot of these businesses, it's really continue to make sure that we press the pricing for the value that we get. And, you know, we've got good relationships with customers. We've got a long standing relationship with these customers.
Speaker Change: Yes, <unk> I'll just add from my standpoint.
Speaker Change: It's a great culture.
Speaker Change: A great sales team, it's a great operational team and so as we worked through integration the learnings from signature and the learnings from one another about how we do things just helps the whole and when you have a really good culture coming.
Speaker Change: Coming in and integrating it really just makes Myers a stronger business. So I think we're quite happy with the Cigna signature acquisition and we're quite happy to have the signature team with Myers.
Carolina Jolly: And I think they value what we bring to the table. So we're just making sure that our pricing continues to reflect that value in most everything we do. But thank you. Thank you.
Speaker Change: What they bring to the table.
Speaker Change: Perfect. Thanks, and then second.
Speaker Change: Second question.
Speaker Change: And in.
Speaker Change: In the press release you discussed.
Speaker Change: Pricing on the material handling segment can you just elaborate a little bit on the decisions around pricing.
Operator: And just as a final reminder, if you'd like to ask a question, please press star followed by 1 on your telephone keypad.
Speaker Change: So.
Meghan Beringer: As we currently have no further questions, I will hand back over to Meghan Beringer for any final remarks. Thank you for joining us today.
Speaker Change: I am sorry Carolina, so youre asking about pricing.
Speaker Change: In the material handling segment correct.
Speaker Change: Yes.
Speaker Change: Yeah.
Meghan Beringer: My contact information is available on the last slide of the stack so if you want to schedule time to continue this conversation.
Speaker Change: Spots, where we adjusted our pricing to make sure that we were more competitive in the market.
Meghan Beringer: Also, we are attending the KeyBank Conference in Boston on May 29. We look forward to connecting with you.
Speaker Change: And to drive volume.
Speaker Change: Yes, again, clearly we've been thank you.
Operator: With that, we will end the call. Have a good day. Thank you and that concludes today's call. Thank you for joining.
Speaker Change: Okay. Thanks, Caroline I was just going to say, we've been very active on just making sure and particularly in our acro Mills area that we've buckhorn area that we've been going after.
Operator: You may now disconnect.
Speaker Change: Any competition that we've had in those areas and I think we've been very successful with that.
Speaker Change: Yeah.
Speaker Change: And just wants it back once again kind of going back to that is.
Speaker Change: Our customers.
Speaker Change: They pay for value and it's really important that when we're going through and we're looking at pricing that we are pricing to the value that we're giving and so I think.
Speaker Change: Yeah.
Speaker Change: The pricing for the value that we get and.
Speaker Change: We've got good relationships with customers.
Speaker Change: We've got a long standing relationship with these customers and I think they value what we bring to the table. So we're just making sure that our pricing continues to reflect that value.
Speaker Change: Most of everything we do.
Speaker Change: Thank you.
Speaker Change: Yeah.
Speaker Change: Thank you and just as a final reminder, if you'd like to ask a question. Please press star followed by one on your telephone keypad.
Speaker Change: As we currently have no further questions I will hand back over to Meghan Beringer for any final remarks.
Speaker Change: Thank you for joining us today.
Speaker Change: My contact information is available on the last slide of the deck. So do you want to schedule time to continue this conversation.
Speaker Change: Also we are attending the Keybanc conference in Boston on May 29.
Speaker Change: We look forward to connecting with you with that we will end the call have a good day.
Speaker Change: Thank you and that concludes today's call. Thank you for joining you may now disconnect.