Welcome to the Koppers Holdings Inc. Fourth Quarter 2014 Earnings Conference Call. Today's conference is being recorded. At this time, I'd like to turn the conference over to Mr. Michael Snyder. Please go ahead.

Thanks, Lisa and good morning, everyone. Welcome to our fourth quarter earnings conference call. My name is Mike Snyder and I'm the Director of Investor Relations for Koppers. Each of you should have received a copy of our press release. If you haven't, one is available on our website or you can call Rose Hilinski at 412-227-2444 and we can either fax or email you a copy. I would also like to remind you that, as indicated in our earnings release this morning, we have posted materials to our Investor Relations website that will be referenced on today's call. Before we get started, I would like to remind all of you that certain comments made during this conference call may be characterized as forward-looking under the Private Securities Litigation Reform Act of 1995. These forward-looking statements may be affected by certain risks and uncertainties, including risks described in the cautionary statement included in our press release and in the company's filings with the Securities and Exchange Commission. In light of the significant uncertainties inherent in the forward-looking statements included in the company's comments, you should not regard the inclusion of such information as a representation that its objectives, plans and projected results will be achieved. The company's actual results could differ materially from such forward-looking statements. The company assumes no obligation to update any forward-looking statements made during this call. References may also be made today to certain non-GAAP financial measures. The company has provided with its press release which is available on our website, reconciliations of these non-GAAP financial measures to the most directly comparable GAAP financial measures. I'm joined on this morning's call by Leroy Ball, President and CEO of Koppers and Mike Zugay, our Chief Financial Officer. At this time, I'd like to turn over the call to Leroy Ball. Leroy?

Thank you, Mike and welcome, everyone, to our 2014 fourth quarter conference call. We have quite a bit to update everyone on as a number of things have occurred since our last conference call on November 6, but before I get to that I would like everyone to note that we're trying something new on this call in an attempt to improve our communications with shareholders. Accompanying our narrative today will be a slide deck that provides supplemental information to aid in the explanation of our financial results and projections. Before we get to that, I would like to summarize briefly all that we've been working on during the past three months. First and foremost, we had the retirement of our long-time CEO, Walt Turner, effective 12/31, with me assuming the reins as of the first of the year. We've also made several organizational changes that will both lower costs and provide a better alignment of skill sets with the challenges we face. We made a decision to exit the U.S. utility pole market, as evidenced by our sale of that business in January to Cox Industries. We completed the strategic acquisition of the KMG creosote assets in January for $15 million which vastly improves our distribution network for both creosote and coal tar by opening up the channels for European supply. We attempted to refinance our 7 7/8 bonds in January, but we're unsuccessful due to unfavorable market conditions. We completed the legal entity reorganization that will provide a substantial cash tax and effective rate benefit beginning in 2015. We finalized our synergy plans for the Osmose acquisition and validated the $12 million of savings that we estimated during the due diligence process. We completed the integration of our new North American Performance Chemicals business into our ERP platform…

Thanks, Leroy. As you can see on slide 2, consolidated revenues for Q4 were $427 million, an increase of $85 million or 25% from the prior year. This was driven by new revenues of $96 million from the Osmose and Ashcroft acquisitions and $25 million from our new facility in China which more than offset a $43 million reduction in sales for our legacy CMC business. On slide 3, consolidated revenues for 2014 were positively impacted by the acquisitions and the new revenues from China which more than offset $109 million of lower sales in legacy CMC due primarily to both lower product pricing and volumes. Moving to slide 4, you can see the Q4 adjusted EBITDA of $24 million was lower than 2013 adjusted EBITDA of $33 million, as a $9 million benefit from acquisitions was more than offset by a loss of $4 million from the KJCC joint venture in China, $10 million of lower profitability from the legacy CMC business and $5 million of corporate integration costs related to Osmose. The decrease in profitability for legacy CMC was driven by reduced product pricing for carbon pitch, phthalic anhydride, naphthalene and carbon black feedstock which, with the exception of carbon pitch, were impacted by lower oil. The loss for KJCC was the result of product pricing declining at a faster rate than our raw material costs. Slide 5 shows our EBITDA bridge for the year. The reduced profitability for CMC, including the new JV, was $33 million which, along with $8 million in lower profits from RUPS due to the crosstie shortage and an $11 million corporate loss that relates to Osmose integration costs, this amounts to $52 million of lower profitability that was partially offset by $18 million of incremental profits from acquisitions. Now I'm going to…

Thanks, Mike. As we finish a second straight year with disappointing results, it is time to step back and reevaluate where we're, where we want to go and what is the best path to take us there. I will attempt to do that in the context of each of the three businesses before pulling it all together at the end. As 2011 concluded, we set a long-range goal for the company to reach a 12% sustainable EBITDA margin beginning in 2015. Due to a series of unfortunate events over the last few years, we will unfortunately not reach that goal. We do, however, believe the goal is still realistically achievable and are continuing to work towards achieving it in the 2016-2017 timeframe. To get there will require the continued restructuring of the global CM&C business that will result in not only shrinking the asset base in the developed regions, but also potentially exiting parts of that business in China if we cannot change our business model to allow us to generate an acceptable level of profitability. The final result will most likely be a reduced emphasis on the more volatile CM&C business moving forward which I think is appropriate given the relative stability and earnings profile of our other two businesses. I will share my perspective on what we plan to do in the near term to get there while lending particular emphasis to what we expect to see in 2015. Let me begin by reviewing what has been the bright spot over the past few years and that is the Railroad and Utility Products and Services business. While this segment took a small step backward in 2014 due to reduced crosstie availability, it still remains our best avenue to top-line and EBITDA growth due to several factors. The first…

[Operator Instructions]. We will take our first question from Lawrence Alexander with Jefferies.

This is actually George D'Angelo on for Lawrence this morning. Can you guys be a little more specific on the dividend? What type of payout ratio would you initially target and what kind of financial metrics do you think would be a signal to us that a dividend reinstatement might be likely?

I think for us, getting down certainly below 4 times, I think and creating some room for us to provide a mix of returning capital to shareholders through a dividend as well as being able to execute on some of the needed restructuring activities to allow us to be a more stable, profitable business moving forward is imperative. So, I think, at a minimum, we need to get down below that 4-times target. And in terms of a payout ratio, it's tough to say at this point. Though, I would say that we would probably look to do something working our way back into things before moving back up to what has been more similar payout ratios. I think we tend to look at the yield in regards to our peer group and try and ensure that we're staying sort of in-line with that. That typically, we've been at the high end of that range when we have been in the 2.5% to 3% yield range. So, I would expect that we would target something that would be in that 2% range. But, for us, in the near term, it is providing the operating flexibility to be able to make the needed improvements that we need to make to get the CM&C business back healthy again.

And just one more. If I'm looking at Performance Chemicals, you guys expect your EBITDA margins next year to be around 18%. If I heard correctly, that's pretty close to the top of the margin range you guys said you hope to achieve. So, just like for the out years, how do you see the margins evolving in that business?

Well I think we mentioned in there that we're targeting a range kind of on a go-forward basis through the cycle of 12% to 18%. Yes, next year we do think that we can be near the top end of that range. I would say as we move out over the years beyond 2015 we think we probably can maintain something in that 15% to 18% range. But, I wouldn't necessarily bank on that staying up at that level out over those years. Again, there is just a lot that can go on especially with volatility in copper and things like that which we do hedge, but we like to give ourselves a little bit of room and flexibility. So, I would say somewhere in that 15% to 18% range is how we would view the outer years beyond 2015.

And we will go next to Ivan Marcuse, KeyBanc Capital Markets.

The first one is on the China. So, I may have missed this, but the timeframe on the, I guess, the one remaining JV. Are you looking to sell that or are you just sort of closed down and move on? And then the second part of that question, I know it's some different products, but what gives you comfort that KJCC doesn't sort of go the same way as the other JVs?

I think that in terms of the other JV that we have over there, the one we're a minority holder on, I think we'll work through several possible scenarios there, having discussions with the majority owner in terms of their interest of taking that business on, again, if we can't come up with a plan that allows for that business to change its profitability dynamics dramatically. But, certainly, we'll start with working with our partners and move out from there. In terms of KJCC and what confidence do we have that that doesn't kind of head in the same direction, it is a different business model. It is a model with a captive customer that has profit margins worked into the agreement that are of a different magnitude than what we're faced with out on the open market. So, once we can get Nippon having their plant and running, there's a lot less risk involved in that business if we're not out having to sell on the open market especially in an environment like we're in today.

And then it sounds like there's a lot of opportunity once you're past sort of this debt pay down in terms of the CM&C of getting their restructuring going and taking out the plants and the cost savings, etc. So, was there any sort of way - I don't what the appetite is - but maybe issuing equity or doing something in that sense in terms of just instead of freezing everything down and paying down debt in that way and then that way you could move forward faster with your restructuring? Or how did you sort of weigh the plusses and minuses of, I guess, these decisions?

Well, I think as we looked at the business today, we're dealing with a number of different things. Not only are we dealing with things from an operational standpoint that have been difficult, but our credibility in the marketplace isn't exactly the strongest right now either. As we've had to continually report disappointing results over the past several years, that's obviously put our stock in lows that it hasn't seen in probably five years. The environment for going out and raising equity for us we've felt is not worth the cost at this point in time. We think that through a very targeted plan of paying down debt we can get there in a relatively reasonable period of time. And there's still some things we can do in the interim that puts us in a great position to act very quickly once capital frees up. So, from that perspective, we just felt that the plan that we chose in terms of targeting that leverage reduction and unfortunately using some of the dividend proceeds as part of that was the best route to go.

Okay. And then my last question and I'll jump back in the queue. If you look at your raw material costs with oil coming down, is that going to bring down your overall average cost for the year? And when do you see that benefit? Is it different region to region?

Yes, it will come down overall. It is different region to region. Our pricing in North America does not move as much. Europe and China are much more volatile in terms of how they move. So we have seen reductions in our coal tar cost over, starting here in the fourth quarter. They've been behind the curve as they typically are, but they're starting to catch up as we're in the early part of 2015 and we will see absolutely lower coal tar costs as a result of the lower oil.

And we will go next to Bill Hoffmann with RBC Capital Markets.

Just a couple questions on the CMC business. I wonder if you can kind of walk us through the carbon black feedstock, the phthalic anhydride and the naphthalene markets for where your margins were Q4, where they currently are and how you see those markets developing this year.

Sure. I won't get into specific margins. We don't get into that sort of detail. I will just maybe put it in perspective by saying that, as an example, in a couple of our regions, again, that are more volatile if you look at Europe and China, we saw overall reductions in pricing in the fourth quarter of this year compared to the last by anywhere of 30% to 50%. And when you look at it sequentially they were down by close to 30% for third quarter to fourth quarter. Now we've seen that settle here in the early part of this year. Like I said, we've seen lower cost of tar during that period as well. I'd say, in Europe, the change in our underlying raw material costs have been more in-line or closer in-line with our pricing as opposed to China, but the numbers are starting to catch up as we get into the early part of this year. There is still some further drops that we'll probably see in the early part of this year, but not nearly as dramatic as what we saw in the back half of 2014. So, pricing will be down, absolutely. Our raw material costs will be down. But depending, again, upon the region, like in Europe we'll be closer to offsetting those costs as opposed to China where there still may be some variance between the overall price reduction versus cost reduction.

And is it the same with the phthalic and naphthalene equations as well?

Well the only difference with phthalic - again I'll give you a sense. So, fourth quarter of this year compared to fourth quarter of last year, phthalic pricing was down 16%. But in North America, as I mentioned earlier, we don't see the sorts of changes in raw material pricing that we see in other parts of the world. So, while we've had relatively flat costs in our raw materials, we've had to deal with a 16% decline in phthalic year over year in fourth quarter.

And then second question, just on the Performance Chemicals business. Could you just help us a little bit with seasonality? I mean I'm assuming Q4 is a pretty weak seasonal quarter. But how should we think about Q1 on a relative basis and then Q2, Q3 obviously a bigger building season?

Yes, because a lot of their business does go into residential construction, as you would imagine, the fourth quarter and the first quarter, they're seasonally lower quarters. That's one of the things that impacted the margins in the fourth quarter. First quarter, I would imagine you're not going to see much difference there in terms of sales and margins. It will probably pick up in the first quarter a little bit just because of some of the integration costs that we would have endured in the fourth quarter of 2014 that won't be there in the first quarter. So, I would say that the margins should pick up by at least 100 basis points or so in the first quarter. And then, you'll see the second quarter and third quarter really be their strong quarters as they're serving that residential construction market.

Is it fair to think about that maybe 60% as Q2, Q3 versus 40% the other two quarters? Or is it higher than that?

I would at a minimum, it would that 60%-40%.

And then just the last question. Capital spending for 2015, I don't know if you gave that.

Approximately $45 million.

And we will go next to [inaudible] with Stifel.

I wanted to see if you could help me bridge some of the cash sources and uses for 2015 and how you get to the $100 million to $125 million debt pay down. How should we think about working capital sources and then potential divestitures? Because we've got roughly $50 million of interest and then $45 million of the CapEx.

Yes. Let me take a crack at that. From that standpoint, we have excess cash in our foreign operations we've identified, at minimum, of $20 million. So, with our new tax reorganization that became effective as of the first of the year, we're able to repatriate through a repayment of principle and interest on the debt we allocated to these new entities and we believe - well, currently, for instance, they have about $60 million outside the U.S. in cash and we believe they can operate from a working capital perspective right around half of that. So, what we've done is we've done a study and what we're going to do in the first quarter is bring back $20 million of that excess cash virtually tax-free, again, under the new reorg and apply that to a debt repayment. In addition to that, we've taken a good hard look and put together a plan for the entire 2014 year to squeeze out $40 million more from just better working capital management; payables, receivables. There are certain instances in our locations where we don't bill on a daily basis; we gather shipments and bill weekly. We're going to change that and do it daily. We pay, for instance, daily on the accounts payable side. We're going to change that. There's some slow-moving inventory. There are some leases that are coming up and under normal circumstances we would go ahead and buy that equipment out as a CapEx expenditure and have cash go out the door. And we've been negotiating with the current lessors to go ahead and not buy that equipment out, but continue to lease it at much lower rates on a go-forward basis and delay that cash payment out into the future. So, we've got $40 million globally coming back and just managing our working capital much better. Leroy mentioned the elimination of the dividend. That's going to help. Leroy also mentioned that there's divestitures of non-core businesses that we're going to be taking a look at. And, of course, when we generate this cash and pay down debt, what happens is that the interest expense that we pay on that debt reduction becomes lower and lower. So, we're going to get an impact from interest expense as well, less interest expense going out the door. And again, from a standpoint of the tax reorg, we're going to paying less money to the IRS on an effective tax rate basis. So when you add all those up, including the possible divestitures of a couple of our operations that are non-core, we believe that that $100 million to $125 million bogey that Leroy talked about in 2015 is doable.

And that tax reorg payment is that 16, one-six?

Yes it is, one-six.

Okay. And then a final question. When you were going through the guidance for CMC EBITDA, you mentioned that at the current pricing the $220 million of sales China are EBITDA negative. Could you give us a sense for what that figure is, whether it's 0% to 5%, 5% to 10%, or something higher?

It's 0% to 5%.

And we will go next to Chris Shaw with Monness Crespi.

What's the level of distillation capacity that is needed to, I guess, satisfy internal needs, satisfy the rail and I guess possibly Performance Chemicals? And is that equal to the sort of reduction you're looking for to go down to three plants from five?

So I'm not sure if this is the question you're asking or not, Chris. But our objective in moving from the five we're at to three would still leave us some slack. We still need to have some slack in the system. When you're operating with three plants to cover two regions, if you run into a situation where you need to take a plant down for a period of time and move supply around a little bit, you need to have some of that slack. But it will take us up to an overall, probably, utilization level of somewhere in the 85% to 90% range. Whereas today, we're operating somewhere probably closer to a 60% to 65% range.

I guess what I'm trying to get at more is what is the determining factor of how much capacity you need. Is it how much commitment globally you have for carbon pitch or is it how much internally you need to like creosote and maybe some other chemicals?

Well I think certainly creosote is an important part of our business in terms of serving the Class 1 railroads and supporting our Railroad and Utility Products business. So, we absolutely need to make sure that we have enough to cover our requirements there, but that won't be an issue. Carbon pitch since it makes up half of the product that comes off. I think it's still going to drive the amount of distillation that we do. So, it will be pitch that will continue, I think, to be the driver of the distillation capacity that we will need to cover that.

To that point, then, you probably won't give me the exact margin, but in terms of what the outlook for margins for pitch itself this year is it - I doubt you'll give the exact number, but is it going to be higher than the overall margin for the segment this year or lower or is it sort of in-line?

Well I think our feeling is that for the first time in a few years it has stabilized in the developed markets. And so, if anything, we expect to see some small pickup on pitch in 2015.

Okay. And then if I can go back to the dividend for a second, I was just curious, did you have any discussions with, I guess, your lenders at all? Or trying to go back and maybe sort of negotiate the covenants at all? Or would that just have been too expensive on interest?

I think certainly that's always an option. We felt that there was a certain piece at this point right now that we - going back to the lenders when we're at a leverage of 5, to me, just wasn't the best route. I mean we need to get our leverage down and providing additional room or margin to account for, again, if another unexpected event happens, wasn't the preferred approach at this point in time. So, we're focusing on the debt pay down.

Just a real quick one on the fourth quarter in Carbon Materials, the loss that the segment reported. Was that just strictly just because of how quickly pricing fell or was there something else there, a one-timer or some inventory charge that I might have missed?

A little bit of everything. Certainly, a lot of it had to do with pricing drops in advance of raw material cost drops. Some of it had to do with a lower cost to market write-down of some inventory. Some of it had to do with some increased tank and rail car cleaning expenses and things of that nature. So, it was a number of different things that factored into it. But, the predominant piece of it was in the pricing drop.

And we will go next to Jordan Hollander with Deutsche Bank.

Most of my questions have been answered. So, I just have a couple of kind of housekeeping ones. In terms of the covenant leverage, you guys gave at 4.7 times, I kind of back into LTM EBITDA of $170 million. Is that the right number to be using and is there any expected Osmose synergies baked into that?

You're talking about the covenant calculations at the end of Q4?

Yes.

Yes. We're at 4.7 times and we have to be under 5.25. So, we've got a lot of cushion there. And that does include - there is a little bit of a difference between what's reported as EBITDA through the financials and the definition of what EBITDA is in the bank covenant agreement. So, the banks give us a little more leeway for any non-cash charges or one-time charges. So, we believe, at this point in time, to go back to the previous question about possibly going to the banks and asking for some negotiations on covenants, we believe at this point in time that we're going to be able to manage through that compliance on the covenants on our own accord.

And then as far as the working capital, you said expecting somewhere around about $40 million this year. When do you expect most of that - is that something that happens pretty quickly with raws going down in price or is that over the course of the year? How do you see the timing of that?

What we've put in our projections in relationship to the covenants has been very, very conservative. We put $5 million of that $40 million in the first quarter, $10 million in the second and then $10 million and $15 million in Q4. So we back-loaded it, but I have to be honest with you; we're moving already. The $5 million in Q1 is very, very light. We've done a lot of things over the last three weeks to get this process started and, even though worldwide and operation by operation throughout the world we're taking a look at how we can increase working capital, there are things that we can do that are coming in every day that we're implementing. So I think from our standpoint, again when we project out the covenants we've been very, very conservative on the $40 million working capital improvement, but what we've seen so far in the last three weeks is that we're going to generate those savings much quicker than what we anticipated.

And then just on to talk about - just on talking about Osmose just talking about how that integration process is going, how you see the synergy targets you kind of laid out, just expectation as to when are those fully running through.

Well, the $12 million is the overall analyzed target and we expect to be at that run rate by the fourth quarter of this year. We expect $9 million of the $12 million to be recognized in 2015. It's a combination of a number of different things. Again it's insurance savings, it's sale of Performance Chemicals products to our sister businesses. It's, again, a pickup of some business through other relationships. It's eliminating some redundant positions. It's a whole host of different things, but $9 million is what we have in this year's numbers, 2015.

And we will go next to Steve Schwartz with First Analysis.

I guess my first question ties into a question asked at the beginning about Performance Chemicals and the cycle. And I'm just trying to get a better understanding of what the risks are to you being at the top of the margin cycle. So I think in your response you mentioned the price of copper. We know there's a housing factor in there as well. Can you just kind of rank the top two or three things that really could pull you into 12%?

I think you just hit the two big ones. When they have been in the down part of it before, it has been through a drop in demand. It has been through an environment of higher copper prices. They have instituted a hedging program from a copper standpoint several years ago that we've continued to carry on. The downside of that is it doesn't allow us to really participate in an environment like today where copper pricing has dropped quite a bit, but it does give us protection on the upside and has allowed them to actually lock in forward business that they weren't able to do in the past. This business is typically an annual purchase order driven business and it doesn't have long term contracts. So, each year you're kind of going out and trying to re-win the business. This environment they've been in has allowed them to actually lock in business beyond just that 12-month period by being able to lock in their customer's raw material requirements, but you talked about, again, the demand side of it. Certainly, they tend to look at repair and remodeling metrics to look at the health of their business or the drivers of their business as opposed to new housing starts, but, certainly, that also plays into it. I think any reduction in consumer spending, any reduction in consumer confidence, you would have to expect is going to affect demand and have an effect on their business. But those are the two big drivers.

Okay. And just as follow-up and this touches on a question Chris brought up about the closure of the facilities in CMC. It really is only creosote where CM&C serves the wood-treating business. Is that correct?

That's correct.

And so, is there a possibility where you would sell these assets off and just get into a long term supply agreement for creosote?

Well it's premature for certainly me to say anything on this call relative to something like that. I just say, in general, as we're looking at the business everything is on the table. I mean we're trying to get this business which is the overall company, back to the point where we can deliver stable, profitable, sustainable results. And as we look at that piece of the business, if we can't see a path that makes sense that doesn't reduce our risk profile for the return that we're getting on it, then to me that's an option. But, it's way too premature to really be talking about anything like that at this point.

And we will go next to [inaudible] with Prudential.

One kind of cleanup question. What we're your actual cash taxes in 2014?

The actual cash taxes in 2014 were about, I think, $12 million to $15 million. I would have to double check that and get back to you, but I think that's the ballpark range.

Okay. And then, in terms of the $200 million to $250 million that you want to generate over the next couple years, how much of that do you think you can do internally and how much is really dependent upon asset sales?

I feel pretty confident in the lower end of that range without asset sales. I think getting to the upper end of that range will require the divestitures that we're looking at.

Jay, your question on cash taxes for 2014 was $16.3 million.

Okay. And so, in 2015, excluding the $16 million payment you have to make to get the improved tax treatment, your 2015 cash taxes on an apples-to-apples basis would be lower than 2014?

Correct. A couple million dollars lower.

Okay. And then, as you guys think about the business and what's core and what's not core, can you help us think about what kind of assets you consider are not core and not meeting the return hurdles that you --?

Yes. First of all, I would say just to be clear, the businesses we're talking about are fairly small businesses. Again, when you get into the CMC&C and the distillation assets, that's all tied together and really you're talking about the same thing in terms of the Railroad and Utility Products operations segment. But we do have small businesses. We don't really talk about them and I'm not going to get into the details on this call. But we have a few small businesses that kind of sit outside of those that - again, there is no reason or need to have them and, at least in a couple of the cases, they are margin-dilutive. So, I think divesting them and recouping whatever cash we can at this point makes the most sense.

And we will go next to Kevin Hocevar with Northcoast Research.

If you decide to divest some of these assets, you mentioned the Chinese assets were EBITDA-dilutive, how quickly do you think you can sell these and is there an active market out there looking for these types of assets?

Well, let me clarify on that, too, because, again, the two joint ventures outside of KJCC, right? One is the majority-held KCCC which has already been in, more or less, shutdown mode. That's the one where our partner has been ordered to shut down their coke ovens and it's just matter of time before they get there. And the assets essentially go away with that business. The question becomes, do we want to retain volume by moving it to the other locations and/or moving into a [inaudible] arrangement or not? But that wouldn't involve an asset sale. That would just involve making a decision to exit a certain piece of that business, The other business, again we're a minority partner. In terms of whether there would be interest in our portion of that business, that's what we're trying to gauge right now. I would think that there would be. We think that there will be. But we're going through that process. So it's tough for me to speak for others, but we would have to believe that there would be some interest there.

Okay. And just a final question. If things don't go according to kind of how you laid out, how much wiggle room is there to the downside on the EBITDA guidance before the covenants get close to getting breached? And what are your options at that point if that does happen?

Well as I say, that's really a difficult question to answer because there continues to be some other levers that can be pulled to help withstand or offset some of that, the primary one being capital expenditures. So, I would rather not get into a specific number. I mean you see - Mike mentioned the leverage ratio that we were at, at the end of the year, 4.7 versus the 5.25 that's required. I think, again, the fixed charge; 1.8 versus 1.1. Just from our standpoint, again, we don't want to potentially put ourselves in a situation where we're having to take other desperate measures if the EBITDA comes in at that lower end of the range or even a little bit lower. So it's just trying to create some room so that we can get to the point moving forward where we have that greater operating flexibility.

And that concludes our Q&A. I'll turn the call back to Mr. Ball.

Thank you. We thank you for your participation in today's call, appreciate your continued interest in Koppers. As mentioned earlier, our primary goal for 2015 is to pay down debt and reduce our leverage. We will also continue to pursue opportunities that make strategically sense for us as well as looking for ways to improve profitability within our existing businesses. We remain firmly committed to enhancing shareholder value by maintaining our strategy of providing our customers with the highest quality products and services while continuing to focus on safety, health and environmental issues. Thank you.