Hello everyone, and welcome to the LCI Q4 2023 Earnings Call. My name is Emily, and I will be coordinating your call today. [Operator Instructions] I will now turn the call over to our host, Lillian Etzkorn. Please go ahead.

Good morning, everyone, and welcome to the LCI Industries' fourth quarter and full-year 2023 conference call. I am joined on the call today by Jason Lippert, President and CEO; and Kip Emenhiser, VP of Finance and Treasurer. We will discuss the results for the quarter in just a moment. But first, I would like to inform you that certain statements made in today's conference call regarding LCI Industries and its operations maybe considered forward-looking statements under the securities laws, and involve a number of risks and uncertainties. As a result, the company cautions you that there are a number of factors, many of which are beyond the company's control, which could cause actual results and events to differ materially from those described in the forward-looking statements. These factors are discussed in our earnings release and in our Form 10-K, and other filings with the SEC. The company disclaims any obligation or undertaking to update forward-looking statements to reflect circumstances or events that occur after the date of the forward-looking statements, except as required by law. So, with that, I would like to turn the call over to Jason.

Thanks, Lillian, and good morning, everybody, and welcome to our fourth quarter and full-year 2023 earnings call. Last year proved to be an eventful year for Lippert as we work to extend our position as an industry leader, while navigating a challenging environment around the RV and marine businesses. Despite continued softness in the RV industry throughout 2023, along with a slow-down in the marine industry in the second-half, our consistent execution on diversification priorities and steadfast commitment to operational discipline helped to lift our performance. As we face these headwinds, our teams took action by leveraging our operational expertise. These customer relationships and robust culture of innovation drive the business forward. Looking at the full-year, we closed 2023 with $3.8 billion in revenue, declining year-over-year from last year's $5.2 billion in revenues, due largely to lower RV going in and marine industry production levels as dealers work to right-size inventories in both markets. That said, it is important to emphasize the durability of our business. As many of you know, we have significantly diversified Lippert beyond recreational vehicles into transportation vehicles, marine, automotive, residential, and their aftermarkets, as well as into Europe. And that effort is now paying dividends. In fact, over the past five years, we have successfully executed our strategic playbook by growing revenues in new markets by nearly [50%] (ph), which has bolstered our diversification. In this quarter, that growth was underscored by the strength of our growing aftermarket businesses. To be clear, these results would not have been possible if we focused our attention on the RV space alone. Instead, by applying our core manufacturing competencies to gain a foothold of adjacent markets, we have created a range of what we believe are countercyclical revenue streams with a combined $11 billion-plus in total addressable growth…

Thank you, Jason. Our consolidated net sales for the fourth quarter decreased 6% to $838 million compared to the prior year period, primarily impacted by a reduction in North American RV and Marine production, as well as decreased selling prices which are index to select commodities, partially offset by acquisitions. Our operational improvements and diversification strategy has personally mitigated the impact seen from lower wholesale segments in the quarter. Sales to North American RV OEM declined 11% excluding both North American RV OEM and marine OEM our business increased 8% compared to the prior year period. Our diversification strategy and continued pursuit of operational improvements have not only provided near term support, but a strong platform to drive long-term growth. The decline in Q4 2023 sales in North American RV OEM was again driven by a decrease in wholesale shipments, which was influenced by current dealer inventory levels, inflation, and rising interest rates. Content for total RV unit decreased 17% to $5,058 while content per motorized unit decreased 14% to $3,506 compared to the prior year period. Again, these content declines are largely attributed to index pricing path-throughs versus elimination of flipper content. We have continued to increase our organic content and market share through our focus on innovation. In Q4 2023, our organic growth contributed approximately 5.4% year-over-year LTM content per unit. Sales to adjacent industries declined 9% versus the prior year driven by the 41% decrease in marine sale. Marine content per powerboat decreased 27% to $1,244, primarily due to price decreases associated with year-over-year declining input costs and changes in product mix. However, sales were positively impacted by acquisition and pricing adjustments for our transportation products. Q4 2023 sales to the aftermarket increased 10% compared to the prior year period, driven by increased repairs and replacements and…

Thank you. We will now begin the question-and-answer session. [Operator Instructions] Our first question today comes from the line of Scott Stember with ROTH MKM. Scott, please go ahead.

Good morning, guys, and thanks for taking my questions.

Morning.

Could you remind us about how the indexing, the timing, all the mechanics work? How often do you go back to the OEMs to talk price? And what's the tell here? How far into 2024 should we expect to see headwinds as you return price?

Yes, that's a good question. We're indexed on steel and aluminum, as you know, so those just happen without any conversations, and we just follow the indexes on those two commodities. So steel, we've seen a trending down in price last quarter and this quarter, and what we're giving back to our customers, we'll see that increase again where they'll actually some increases on steel in Q2 as steel went down to low-30s and now it's back up into the mid-50s. And aluminum stayed pretty consistent, so there hasn't been a whole lot of movement on aluminum. And we might maybe index more than other businesses out there, so the good of it is, is we just don't have to go and have those conversations with our customers on a regular basis with respect to the steel commodity-related products. The rest of it's just kind of as we see commodities moving up to need price or to give price back, then we have those conversations with our customers. But steel and aluminum, they're fixed on the indexes.

All right.

Scott, so to add a little color also from this -- from the content, as we've talked in the past couple of quarters, the index pricing is still materially impacting that change in content per unit on a trailing 12-month basis. The fourth quarter, kind of consistent with what we had talked about in the last call, was also mid teens in terms of percent give-back impact on the content number.

Got it. And then my next question and I'll go back into the queue, is on the first quarter, just trying to make sense of some of the puts and takes as far as sales. And will we be profitable in the first quarter?

So, in terms of -- yes, that's the expectation here. In terms of expectations from a sales perspective, so as we're starting the year, RV is coming back. As we indicated, January, we returned back, we had good production, up versus last year. Expect RV to continue to trend well as we move through the quarter. That said, marine is definitely a significant headwind. We had a very strong first quarter in 2023. We are materially off that in January, and expect that to continue. We're down anywhere from 40% to 50% in marine when we compare it to last year. So, from a net-net perspective, I would expect revenue bottom line to be up sequentially from fourth quarter, but we will be down versus 2023 because of that marine softness.

And, Scott, we've had January results, and so we were profitable in January. We know January. February; revenues look very similar to January at this point in time, at least from an RV's perspective. And if you look at March, and we've got certainly a visibility into March, we're seeing RV OEMs increase some days production, which in some cases will be 20% for some of those, and others that are flat, and others that are just adding a few units a week to their production schedule. So, January and February look pretty consistent with one another, March looks like it'll be up a little bit. So, it looks like, like we've said all along, that we know that what goes down must come up. And feels like we're starting to come off the bottom, at least in March we'll certainly see a little bit more volume in RV. That helpful?

No, very helpful. So, just to be clear, profitability would be lower than last year's first quarter? I'm just trying to understand.

Well, we're not through the quarter yet.

Yes.

Okay. I'm just trying to get --

So, what I'd say from a margin -- yes, so --

Sorry, go ahead.

What I was saying from a revenue perspective, Scott, I would expect revenue to be lower overall because of the marine softness offsetting some of the --

Say, flat-to-lower.

Yes, flat to lower, and then from a margin perspective I would expect us to be a little bit better than where we were last year in the first quarter.

Okay, perfect. Thanks so much, guys.

Yes.

Yes.

The next question comes from Fred Wightman with Wolfe Research. Please go ahead.

Hey, guys, good morning. I just wanted to maybe clarify something on the shipment outlook for '24. And I believe it's unchanged versus what you guys have talked about last quarter. But Jason, you've also talked about some of the disconnect between what the RVIA reports in terms of shipments versus what's actually produced. So, can you just sort of level-set if we think about the 313 that the RVIA reported for '23, what you think the actual production number was, and maybe how to evaluate that against your 325 to 350 outlook for '24?

Yes. Yes, and that's good, I'm glad you're bringing that up because we wanted to make the point anyway. It's just important, like you said, to consider wholesale production versus wholesale sales. So, they reported, last year, the 313 or whatever the number ended up to be. We feel the number in terms of units produced, because they sold a bunch of units in '23 that were actually built in '22, that we would have built components for in '22. So, we feel that delta was a production number of maybe 280-275, somewhere in there. It's clear enough to put it in a short range. So, we feel that even if the -- even if, on the low end, you're at the low end of our 325 to 350 on RV, we could see another 35,000 to 45,000 units of what we will product this year, from a wholesale perspective, different than last year. So, I think that those are the puts and takes. We're not seeing in -- this January, it's -- January was up a little bit, but from a seasonality perspective I think that, like I said, March, April, May, June, these dealers are going to need product, and that's where we're going to see more of the bump to get us closer to that 325 and north number, whatever number you're picking. But yes, from a production perspective, feels like at the low end of our scale, we're 35,000 to 45,000 units more -- more units that we'll produce components for this year than last year, which is significant.

Okay, that's helpful.

That helpful?

Yes, no, that's great. Just thinking about the January and February commentary, I mean basically every other consumer company has talked about some impact of weather in January. Is there anything that you would call out there that we should keep in mind, either days that got cut that are reflected in that January number, incremental days in February, anything that stood out from a weather impact perspective?

There was weather impact for sure. There was a few days of shutdown, but the OEMs made some of that back, and then some of it they didn't. Some of those days fell in inventory days, so there might've been a little bit of impact there. But I would say that, year-over-year, we're always seeing weather-related impacts, a day or two here or there, and it's usually in January or February, so.

Fair enough. Thanks a lot.

The next question comes from Daniel Moore with CJS Securities. Please go ahead, Daniel.

Perfect. Thanks, Jason. Thanks, Lillian, for taking questions. First, on the marine side, that down 40% to 50% that you described, is that all production? Are your customers managing down their inventories or is it [IV stuff] (ph) of that more just-in-time, similar to RV?

Yes, we're for sure just in time. But I think that the downside that we're seeing there is partially similar to what we saw with RV, where inventories are starting to be just at the dealer level, and OEMs just aren't building. So, you'll probably see a little bit more sell through on the retail side, which will impact both the OEMs and our production on marine.

Understood. That's helpful. And then, maybe just, you talked about it in roundabout terms, but just your expectations for content growth in RV as well as marine kind of H1 versus the full-year '24. Do you expect positive growth for the full-year and is pricing more likely to be a headwind at least for the first-half?

Yes, we maintain that if you eliminate the indexing puts and takes out of whatever the content number is that our ability to continually organically grow content of 3% to 5% to 6%, somewhere in there. It just depends on what we're launching and how the OEMs adapt and bring in our new products. So, we feel like we can positively grow organic content on a consistent basis, and we've demonstrated that over history.

Okay. One more, little in the weeds, but the glass and acrylic factory, can you maybe a little bit about some of the newer end markets you're targeting with that capacity and capabilities and what does the total TAM look like relative to the revenue you're currently generating out of there? Thank you.

Yes, we don't have just getting the last piece. We don't have a TAM on there yet because we're in early stages. But we've got probably three-fourths of the factory running. So, we've been kind of installing it in pieces and it's pretty impressive if you come out next time. We'd love to take you through. Let's see everything, but we're doing housing glass for both manufactured housing and residential housing, we're doing certainly RV glass and now our RV door glass. If you've been around RVs lately, we're putting glass on the front doors of the units to make it look nicer and adding some content there. But if you look in some of the commercial markets we're building for there, you look at solar glass, refrigerator glass and grocery stores we're doing some of that. A lot of garage door glass, if you look at garage stores these days, both commercial and residential, you see a lot of glass in the garage doors versus just an older type door that you'd normally expect. So, and then we get to acrylic. They can do some thermoforming there and we expect acrylic to be big RVs, I mean we're going to certainly offer that as part of our mode on windows, which is second or third largest component in the RV business for our core products. So, we'll have acrylic for windows, which nobody else has here, and then we also will do acrylic skylights and things like that. You're seeing a trend with our RV OEMs that continue to put more glass and acrylic around the units to just let more natural light in the units. It sells units. So, that's where we're at today; more of an update next quarter.

Very good. Okay. I'll jump back if I have any follow-ups. Thank you.

Sure. Thanks, Dan.

Our next question comes from Mike Swartz with Truist Securities. Mike, please go ahead.

Hey, good morning. Just first question maybe, Lillian, on the towable content, down 17% in the quarter, I think you provided some of the moving pieces there. But can we just go through how much of that was M&A versus pricing versus organic growth?

Yes, I'd say the key elements to break out there, Mike mentioned that in terms of the index pricing to give back, that was in the mid-teens as a percentage basis. The organic growth was at about 5.4%. And then, if you looked, and I think Jason cited this in his commentary, the overall growth, which would have included acquisitions as well was sitting at about 8.5%. So, really, the biggest headwind that we've been experiencing and this has been consistent as we've moved through the quarters in 2023 has been the index pricing giveback. That'll begin to mitigate as we move through 2024. We'll still have a little bit of a headwind in Q1. But as we move through the quarters, consistent with what we've talked about before, we expect that to mitigate and you'll really see more of the full impact of the organic benefit of our growth that is 3% to 5% that Jason was just citing.

Got you. That's helpful. Thank you. And then, just on the gross margin in the fourth quarter, maybe if we compare it to the third quarter, I guess what were the puts and takes there? It's down about 300 basis points, but we assume that that mix towards aftermarket was a positive. But what are some of the negatives that you encountered in the quarter?

Yes, I'd say the biggest impact frankly, is the volume, and the headwind that that had on us. Mix was a little bit, but by far it was just decreasing the sales volume.

Okay, perfect. And then, I know in the past, you've kind of provided us some guide rails around EBIT margin, and I think you said in the first quarter on a year-over-year basis. It should be a little better. But I guess any way to think about that on a full-year basis for 2024 and maybe how that plays out as the year progresses?

Yes, so we've talked before that we'd expect the margins to be kind of in the call it the mid-single-digits. And really, that's where we probably are going to see ourselves this year as we progress through 2024 with the quarter. So, there'll be some little bit higher quarters depending on the volume that's flowing through and a little bit lower quarters depending on seasonality. But net-net, kind of at mid-single-digit for this year is probably a reasonable assumption.

And Mike, going back to the other question too, we did call out warranty as well. If you look at sales like Lillian said, significantly underpriced compared to the last couple of years when we had a significant amount of units built over COVID, just the volume of it and that starts to show up a couple of years after these units start getting sold, so, that'll eventually retract.

Okay, great. Thank you.

Thank you.

The next question comes from Craig Kennison with Baird. Please go ahead.

Yes, thank you for taking my questions. Jason, I just wonder if you would characterize the competitive landscape today versus your long history with the company. There's just a tremendous amount of investor concern about your share loss and yet you talk about organic growth when you unpack some of your content per unit metrics. So, honestly, just trying to reconcile a lot of different information, some different sources there, and wonder how you would characterize the competitive landscape and whether there are categories where you're losing share.

It's my favorite topic, Craig.

Thank you.

So, yes, I'll categorize it. I mean look like I said, I've been in this business since we started our first RV products. So, 30 years, I watched a lot of competitors come and go. I put them into a couple of different categories. Some we've beat and they're gone. Some we've acquired and they're part of our business now and others are still around. We're competing with them on a regular basis. And we have, I'd say over the 30 years what's been consistent is not only that but the fact that, just competition is part of what we do. It's part of the business, it's part of any business. And you look at the new entrants now, if you're looking at the axle thing that people keep bringing up, the air axle thing, people keep bringing up. We've had new competitors, I would say almost every year in the last 30 years. So, I just keep pointing people to our track record and say, look at our track record. We won more battles than we've lost. We continue to use innovation to beat our competitors. We use our bundling and just our massive mode of products there to beat competitors. And then, now we've got diversification strategy, which allows us to do some things that we couldn't do five to 10 years ago. So, I point to those things and look at, if you're pointing specifically to air axle, I'd say look, we're taking double-digit margin increases in market share against that business in the last two years. You look at this axle thing that's popped up, yes, we've lost a little bit of axles on the Forest River side of our business, but axles in general is a small part of our business. And to boot, we've had we won a million axles this year. So, axles was like one of the biggest gainers in 2023 where we were almost flat year-over-year in our axle business. We don't typically get that granular, but to kind of defend the whole competitive landscape thing, I have to point it out. And just to say, look we're down 50% in other RV products. We were flat in axles even though we lost a little bit of market share. So, I just say we're going to continue to compete. We'll find we'll have new competitors next year and it doesn't bother us.

Yes, thanks for that, Jason. And I just wonder if there's a way to reconcile what you just talked about with what Lillian talked about, which was mid single-digit margin. I know that's below your long-term target and maybe what you've delivered in the past in terms of EBIT margin. So, what is driving that margin pressure if the competitive landscape is within the realm of what you've experienced in the past?

Yes. I would say a couple of things. First, if you look at the last three years, '23, '22 and '21, our operating margin was just a little over 8% and $16 billion in total revenue. So, you look at that and say, okay, over time, will they perform? I mean, yes, we pick out one down cycle. We've had, I'd say, 2.5% over the last 15 years. We had a little dip in '18 and then we had the latter part of '22 and '23. So, yes, in those years, we're definitely going to see the pressure in margin. I think maybe one difference from between now and '08 is we have all these indexes in place where when there is extreme volatility in steel and aluminum pricing, there's going to be some bigger swings in profitability, but it all evens out in the end because we're going to get we're going to get the price sooner or later, and it fell pretty significantly over the course of the last half of last year and Q4 and Q1 -- Q4 last year, Q1 this year is when we kind of see some of that headwind. We're out of it in Q2 because we've got some price increases coming on the steel side. So, -- but I would say, over time, I would expect the same kind of margin performance and knowing that we're going to have a down cycle every once in a while. Maybe we -- maybe the -- on the steel side, we're giving -- I'd like to think we're contributing to the lower ASPs right now because we're one of the ones through the steel have given some pretty significant increases. And we all know if ASP is lower, then we're going to probably have a better chance of selling more RVs. So, --

Craig, also on that building on what Jason was just saying, I mean, well, yes, we are seeing the RV industry recovery in 2024, we're still not back at the historic levels in terms of wholesale and production. This business as we stated before, this business really is and will be a double-digit margin business. I'd say once the overall industry is in plural, not just the RV, but overall industries return back to what is more normalized. I think we've done the right actions in terms of flexing the business, streamlining where appropriate. And now it's a matter of capitalizing on the recovery of the various industries that we perform and to get back to those double-digit margins that we should be delivering, and we will be delivering.

Great, thank you, and helpful. Thanks.

The next question comes from Bret Jordan with Jefferies. Please go ahead.

Hi, good morning guys. This is Patrick Buckley on for Brett. Thanks for taking the questions.

Good morning.

Could you talk a little bit more on the international side of the RV business and how that's trending? How is that cycle over there compared to the U.S. as of late?

Yes, great. We've been in the international side for about almost 10 years, almost a decade. And what we've learned is that it just moves slow whether it's going down or whether it's going up. There's just a little bit slower reaction time by the market, by the OEMs, the supply base, everything moves a little bit slower. So, I'd say that over time, you can plan on that, just on the RV piece of it being more consistent. It's never going to go -- it never seems to go up substantially and big ways are down substantially in big ways. So, it's a more consistent part of our business. And right now, it feels pretty flattish. And I know there's some talk that there's some business downtick in some areas, but we're still seeing opportunities with content gain and market share gains over there. So, we expect it to be pretty flat.

Got it. That's helpful. And then, on the marine side of things, how close is that to the bottom? Is it still accelerating down here? Or is it going to start to flatten out soon?

Yes. I think they've realized when you look at some of the other public company releases, I think that they realize that they need to really slow production, and they've done that, started really tailing of last -- or early part of last half of last year. So, we'll see how quickly the dealers can get through product, but the products have never looked better, and I think that's what helps sell both. Certainly, there's product moving out there. It hasn't completely stopped on the retail side, but we're kind of playing that same game at the RV OEMs and dealers played last year is like just wait for inventories to catch up and get to a reasonable level, and we'll get back to business. But it doesn't feel like it's going to be as extensive or as long as what we saw on the RV side. So, we're hopeful that they can get that fixed this year.

Got it. Very helpful. Thanks, guys.

Thanks, Patrick.

The next question comes from Brandon Rolle with D.A. Davidson. Please go ahead.

Good morning. Thank you for taking my questions. First, just on the competitive lands, you had talked about organic market share gains, keeping your market share. With increased competition, are those market share wins or your ability to protect the market share you have coming out of lower margin maybe from people, more people bidding on products or just an overall push in the market to get pricing lower to the consumer?

Yes, I think in some cases, yes. In some cases, no, but I think that's always the case, Brandon. I think that you can always make the argument that if there's a lot of competition, a lot of pressure that, that definitely forces margins down in some cases. But I'd also say, look, a lot of the stuff we're doing we take our air conditioner we mentioned, for example, there's not another product out there like it. So, while we're competing in the air conditioning space, we've got a product that nobody else has. It's higher capacity. It's quieter, and we can retain margins on anything that's got IP or unique properties or unique features and benefits. So, our ABS, certainly, there's just nothing else out there really that is giving a competition so we can hold margins and things like that, new suspension systems. But on some commoditized products, for sure, you're going to experience margin pressure and things like that. But I don't think it's really any more than what we're typically used to, and that's probably the main stories. We're competing always and have for the last 30 years, it's just a matter of -- it just seems to be more on everybody's radar now.

Okay. And then, just lastly, just going back to the fourth quarter, wholesale production was much stronger than I think you guys had forecasted for the quarter, earnings came in a little lighter than expected. What kind of gives you confidence in your ability to forecast margins moving forward, given it seems like throughout the second-half of the year, maybe around the new model year, things got a little squirrely in terms of just accuracy with the forecast. Thank you.

Yes. So, to that, I mean, a couple of things to point out with the fourth quarter. So, we were within that range. However, I'd say at the very low end on the RV side. Brandon, the biggest driver there was the marine drop off. I don't think that was anticipated or expected for the industry itself to drop off so dramatically. And look, when we're in a time of dramatic volatility in terms of industry expectations, production levels, frankly, it's difficult to plan and it's difficult to forecast in that manner. As we're looking forward to 2024, when I think of the various markets that we're in, I think we're anticipating a little bit more stability from the RV side of the business, which is obviously a significant part of the business. Marine is going to be a challenge. We're expecting that to be down this year. Again, it's going to be driven by the industry. It's not us driving it. We'll need to flex and respond appropriately. So, taking into account the macros and what we're hearing from our customers and the dealers, we're confident in what we're putting forward. Again, the industry is always going to be a little bit of your wildcard in terms of what actually pulls through for production.

And just to add to that, Brandon, I'd just say -- the puts were -- there was a little bit more warranty than normal, like I mentioned a little bit ago. That will normalize here when we get some volume. Marine was the other big one that Lillian mentioned, but that's less than -- a little less than 10% of our total business. So, that being off doesn't impact us as much as you might think. And then, RV, like she said, we'll -- we expect to continue to normalize, and aftermarket has been very steady. And as we keep talking, we expect the service and repair part of our business to continue to grow double digits. It's -- we're just doing more and more repair and service because we've got more and more OEM parts in the field as we've penetrated market share and OEM content over the last decade. Those units are all starting to come back and need repair on parts like innings and axles and slide-outs and leveling systems and all the different things that we build. So, hopefully, that's helpful.

It was. Thank you.

Yes, thanks.

Yes.

Our final question comes from Tristan Thomas-Martin with BMO. Please go ahead.

Hi, good morning.

Hi, how are you doing?

Good morning.

Jason, was there -- I'm good. How are you? Was there a significant delta between wholesale shipments and wholesale production in fourth quarter?

I know for the year, there was. I don't think -- I'm not going to sit here and tell you what the number is because I don't know, but it doesn't feel like there was -- it might have been a little more a little less, but I don't know. For the year, we said like you can count on 35,000 to 45,000 units probably if you're expecting a difference this year to next -- last year to this year on a wholesale number of $325-ish.

Got it. And then, trying to kind of square your -- the RV kind of the industry production in January relative to your sales guidance. I'm kind of getting content on the RV side is similar to what it was in 4Q? Is that the right base to kind of use moving forward?

Yes, that should be pretty consistent. I'm just trying to think some -- thinking of it in a trailing 12-month manner. That should be -- overall, it's pretty consistent.

The only difference we noticed was a little bit of a mix shift in single axle trailers versus what's historical. And of course, you're out of the shows you feel this -- all the entry-level step Bob Martin was on a podcast the other day and said something in fact that he noticed that it shows a lot of the entry-level steps moving. So, we're seeing a little bit of that trend and -- but I think it's important to note the difference between mix shift and de-contenting while on a mix shift to lower units, we're going to have a little bit less content there, but we don't see the de-contenting of our products on units that would make any impact on our content number.

Okay, got it. And then, just to squeeze in one more. I think you got market share content gains of 8.5%. How is that kind of calculated -- what's behind that?

Can you say it again Tristan?

Did you call out market share content gains of 8.5%? I mean just curious kind of how you calculated that number.

Yes. So, what that was, the $8.5 million that Jason quoted it was the organic growth in our product on a trailing 12-month basis, plus the addition of acquisition content.

So, the index pricing puts out of there.

Okay, okay, got it. Thank you.

We have no further questions. So, I'll turn the call back over to Jason. Thank you.

Thanks, everybody, for joining. We're really looking forward to next quarter. We'll see you all then. Thanks. Bye-bye.

Thank you, everyone, for joining us today. This concludes our call, and you may now disconnect your lines.