Ladies and gentlemen, thank you for standing-by, and welcome to the Fourth Quarter 2019 Sealed Air Earnings Conference Call. At this time all participants are in a listen-only mode, after the speakers’ presentation there will be a question-and-answer session. [Operator Instructions] Please be advised that today’s conference is being recorded. [Operator Instructions] I will now hand the conference over to your speaker today, Lori Chaitman, Vice President of Investor Relations. Please go ahead.

Thank you, and good morning, everyone. Before we begin our call today, I would like to note that we have provided a slide presentation to help guide our discussion. This presentation can be found on today’s webcast and can be downloaded from our IR website at sealedair.com. I would like to remind you that statements made during this call stating management’s outlook or predictions for future periods are forward-looking statements. These statements are based solely on information that is now available to us. We encourage you to review the information in the section entitled forward-looking statements in our earnings release and slide presentation, which applies to this call. Additionally, our future performance may differ due to a number of factors. Many of these factors are listed in our most recent annual report on Form 10-K and as revised and updated on our quarterly reports on Form 10-Q and current reports on Form 8-K, which you can also find on our website or on the SEC’s website at sec.gov. We also discuss financial measures that do not conform to U.S. GAAP. You will find important information on our use of these measures and their reconciliation to U.S. GAAP in our earnings release. Included in the appendix of today’s presentation, you will find U.S. GAAP financial statements that correspond to some of the non-U.S. GAAP measures we reference throughout the presentation. With that, I’ll turn the call over to Ted Doheny, our President and CEO. Ted?

Thank you, Lori, and thank all of you for joining us for our earnings call. I’ll start with a quick recap of our fourth quarter and full-year 2019 results and discuss the progress we are continuing to make on Reinvent SEE and how it’s transforming Sealed Air. This is an exciting journey and we look forward to the year ahead. I will conclude with an update on our 2025 sustainability pledge. Jim will expand on our financial results for the quarter and full-year and provide our outlook for 2020. We’ll end the call with Q&A. Turning now to Slide 3, in the fourth quarter we delivered 9% adjusted EBITDA growth on 3% higher sales compared to last year. Our EBITDA margin expanded by 120 basis points to 20.9% due to productivity improvements from Reinvent SEE, earnings from Automated Packaging Systems acquisition and favorable price/cost spread. For 2019 our top line was driven by acquisitions and organic growth in our food business mostly offset by currency translation headwinds and volume weakness in protective packaging. Despite modest sales growth of 1%, we delivered strong adjusted EBITDA growth of 8% and free cash flow of $321 million. Slide 4, reiterates our vision, our strategy, and how we’re using Reinvent to make this happen. Our vision is to transform Sealed Air from the best packaging company to a world-class company servicing the global packaging industry. Today, we are the leading innovator in packaging and are making it different in the industries we serve with automation, service and materials. I’m proud of how our global team has embraced Reinvent SEE. We’ve executed well and have delivered strong results in a difficult environment. We’re reinventing everything we do from how we innovate to how we solve our customer’s toughest challenges. We’re doing this by operating as…

Thank you Ted and good morning everyone. On Slide 6, we’ll start with the review of our net sales by region. In the fourth quarter sales of $1.3 billion increased 3% as reported and 5% in constant dollars. We’ve delivered growth across all regions, which included a full quarter of sales from Automated Packaging Systems. In constant dollars, North America, our largest region representing 58% of the company’s sales grew 3% year-over-year. EMEA was up 4% and Asia Pacific was up 2%. South America where we have U.S. dollar index pricing was up 31% of which 12% was volume growth. As a reminder, Automated Packaging Systems generate 75% of its sales in North America with 20% in EMEA and the remaining 5% in Asia Pacific. On Slide 7, you can see our net sales by region for the full year. Similar to the fourth quarter, we had constant dollar growth across all regions. North America was up 4% and EMEA and Asia Pacific were both up 2%. South America was up 27% of which 5% was volume growth. Turning to Slide 8, here we highlight our organic sales volume and pricing trends by segment and region. In the fourth quarter, overall volume excluding acquisitions was down about 2% driven by a modest decline in Food Care and a 4% decline in Product Care. Food Care faced market challenges into year-end mainly due to a heavier than expected mix of frozen pork and beef exports into China to alleviate protein supply shortages ahead of the Chinese new year. Overall Product Care volumes were in-line with our expectations. Product Care volume in North America declined high-single digits, which was a similar trend to what we experienced in the third quarter and it’s to a large extent due to a weak industrial manufacturing…

Thank you, Jim. Operator, if you could turn to Slide 15. As we head into 2020 it’s clear we’re well on our way to achieving our vision of becoming a world class company serving the packaging industry. As illustrated on Slide 15, you can see how we’re reinventing our powerful brands and operating as one company. The four P’s of Reinvent SEE are our guide. Going forward, we’ll continue to focus on our performance like delivering new and sustainable products to our markets faster and breaking into attractive adjacent markets. This will ensure that we grow faster than the markets we serve. Our success will be dependent on our people, operating as one Sealed Air with a focus on growth and productivity, as well as developing, retaining, and attracting the best and brightest talent. From a product perspective, our goal to deliver the best products, get the right price and make them sustainable is resonating with our customers. We’ve made significant progress on our processes. Operational disciplines are becoming embedded in the organization and demonstrating sustained results. We will lead in sustainability by bringing value to our customers while helping them meet their own sustainability goals. We’re excited for what’s ahead and as always we’ll focus on what is in our control. With that, I’ll now open up the call for questions. Operator, we’d like to begin the Q&A session.

Thank you. [Operator Instructions] Our first question is from Brian Maguire with Goldman Sachs.

Hey, good morning guys. Just a question on the Food Care volume outlook. I think you said you expect the global protein market to be flat, but for Sealed Air to grow volumes 2%, just given the fourth quarter number was a little bit below the market, just wondering what gives you the confidence to say that you’ll have the ability to outgrow the market by 200 basis points or so. And I just related to that, wondered if you could provide some more details on the small strategic acquisition you did in Food Care.

First we’ll talk about North America, as we’ve seen some of our customers reporting, we’re expecting the North American production to be up around 2% in next year. We do expect there’s going to be some choppiness as we’ve highlighted going into - in the fourth quarter and what’s going on with China right now. But we think in the second half of the year we should see the growth that we have out there, so we feel good about that. The dynamic that we’ve been talking about with what’s happened in the pork market with frozen exports, we do think that will be a rebound specially we’re working directly with our customers right now both from the U.S. and as well as from South America. Right now we’re not getting most of that frozen business, but we think over the year that will convert back to fresh and we think we even have some opportunities to get participate in that frozen export business. On the second question on the small acquisition in Food Care, that’s a geographic acquisition that we made in the Philippines that actually is exceeding expectations. It’s small, it’s less than $10 million, but it’s giving us that local presence that we need in that fast growing market.

And Brian this is Jim. Just to add a little bit to the above-market growth in food. We do have new products that we’re confident we’ll start to have traction in the market. We talked in the comments about the sustainable Plantic and Darfresh offerings as well as our new FlexPrep vertical pouches for fluids. And in addition, we have a strong backlog of equipment orders that we expect to deliver in 2020. So it gives us high confidence given the backlog that we can deliver there.

Operator, next question, please.

Thank you. Our next question is from Ghansham Panjabi with Baird.

Hey, guys, good morning. Just as a follow-up to Brian’s question on the Food Care volume assumptions, can you just kind of break that out between the regions to Australia with the wild fire – with the fire impact and so on? What are you thinking about that market? And then second, on the EBITDA bridge, between $965 million in 2019 and call it $1.02 billion at the midpoint, you’ve given us some of the moving parts with Reinvent SEE savings and APS and FX, but what about price/cost and also operating costs? How should we think about those moving parts? Thank you.

Okay. Let me take the numbers question and then Ted will take the question on the regional sales expectation for 2020. So we’re looking at about, let’s call it $55 million of higher EBITDA in 2020 versus what we delivered in 2019. $110 million as we laid out is coming from Reinvest, so that’s a positive. Incrementally for APS, seven months, having APS in the portfolio for a full year will help by about 25. So We’re up 135. You ask yourself, well, how do you get back down to that 55? Well, it’s inflation is a big part of the reduction. That’s about $50 million. And then we talked about negative price/cost spread in Food Care in particular, driven by the formulas. So keep in mind, the formulas are driven off of the resin profile that the company experienced in 2019. And those will be passed – some of those gains in 2019 will be passed through these formulas as we talked about, mostly in the first half of 2020. So together between inflation and, call it, net price/cost spread, that’s about, let’s call it, $70-ish million. And then the remaining $10 million is unfavorable currency. We talked about currency at the top line being less than it was in 2019 versus 2018 but still a drag, $40 million sales and about $10 million of EBITDA.

Okay. Thanks, Jim. And Ghansham, going back to – on the Food Care piece and building off the previous question and our confidence why we think we can get that 2% growth. I just want to reiterate again, the first quarter, probably even the second quarter, there’s going to be some choppiness as we’re working through some issues. But we do expect to see growth in North America. And as we – especially as the North America, we’re seeing growth from our customers. But also, you’ve seen some of our customers talk about the automation. We do have some line of sight to that equipment business. We see some of that equipment business clearly in 2020, so that’s giving us confidence in North America. We also are seeing some penetration in some of our adjacent markets in that being in our liquids business and also the alternative proteins, and we’re all seeing some growth in seafood. Again, those are small, but we are seeing that growth beneath and coming through in North America. To your question on the fires in Australia, we do see Australia that is trying to cover that market through into China. We do expect some of this market to return, probably more again on the second half. But we are – the growth in Australia will not be there because that herd continues to be reduced. We do see strength, still, in South America. We’re doing well. We even see more potential in South America. Quite excited about what we can do and continue that growth in South America into 2020. So net-net, we do have some challenges out there that we’ve identified. We do think we can recover the growth in our Food Care, so we think we definitely have a doable guidance out there for 2020.

Operator, next question, please.

Thank you. Our next question is from George Staphos with Bank of America.

Hi, everyone. Good morning. Thanks for all the details. I wanted to spend my question on Product Care. So recognizing it’s hard, ultimately, to call the future, Ted, when do you think, with your traditional markets shrinking, particularly the traditional void fill for various reasons, that between the sales of your more value-added products and anything else that you have in the pipeline or that you’re thinking about, that your volume growth within Product Care will cross over and turn more positively? Is that really likely in 2021? Or is it too hard to call that given all the secular issues that you’re seeing in traditional void fill markets? Relatedly, if you could mention to us a bit in terms of how Instapak is doing. I’m assuming it’s not doing great given the industrial exposure. But what are you doing to – because it’s such a good product line for you, what are you doing to have it sort of break out of industrial? And then as we put it all together, combining Reinvent, combining whatever volume and price/cost trends you’re seeing, when should we see or can we continue to look to improving EBITDA growth in this segment in spite of the headwind on volume because of what you’ve going on from Reinvent? Thank you and good luck in the quarter.

Okay. Thanks, George. I’m going to get Jim to tag team some of this with me so I make sure I got all the questions there. Well, I’m going to go through first on the Product Care, then I’ll go through the Instapak of what we’re doing. And then only because – Jim, you could jump in on where we see the Reinvent going forward on the price/cost spread. So, first, on the Product Care, I think we do see it turning. We still – for next year, we’re seeing organic down 2%. And so if we break up our portfolio, we have seen some gains with our new products, just not fast enough. We’re actually using this – I keep saying it over and over again, best product, right price, make it sustainability – the sustainability to help drive that portfolio. We have seen success in our paper products. We have seen that move, still not enough. What I feel good about North America, actually, you have to look into Europe and see what the EMEA team has done. Similar conditions, they actually got growth in 2019 with their new products, redesigned the mailer to a recycled content, bringing in the paper products. So we just have more work to do. And plus, in Europe, they got growth in the e-commerce with an automated solution. So in the Product Care, I think the 2%, we have to do it internally, our numbers I think have turned. You asked specifically, is it 2020. I’d like to underpromise and overdeliver that I think we can do that. The other key piece on Product Care that we are seeing move ahead is what the acquisition with Automated Packaging Systems, which internally, we’re using their name and calling it Automated. That’s where the…

Sure. And George, I think despite the fact that we had organic volume decline across the year in Product Care, let’s call it, 4% total – or 3.5% with a little bit more on volume, we were able to improve margins from 17.5% to 18.3%. So even in this segment, we are seeing the benefits of Reinvent SEE drive – more than drive through the negative impact from volume. Now we did have a favorable price/cost spread in 2019 versus 2018 that we would not expect to repeat in 2020. So having said that, we do think that the margin within that business will continue to improve and likely end closer to 18.5% for the full year next year. So not a huge improvement from where we ended year-to-date in 2019, but still a modest improvement. And again, it’s driven by the Reinvent contribution as well as APS. Recall when we acquired APS, the margin in that business was roughly 14%. And we recognize that there was an opportunity, if you will to reinvest their cost structure. And we made good progress in 2019, we guided up closer to 17% by the exit point in 2019, and we would expect that to continue to improve in 2020. It will still be close – by the end of 2020, close to the average for the segment, which is really good. So again, next year, we can’t count on – in 2020, we can’t count on favorable price/cost spread. We’re looking at the flattish raw material and freight profile and pricing. There will be some drag there, not a lot, but then you’ve got the Reinvent benefits coming through that line as well. So overall, I think the company is doing a pretty nice job in this difficult volume environment, holding margins and slightly – and even slightly improving it.

Operator, next question, please.

Thank you. Our next question is from Adam Josephson with KeyBanc.

Ted and Jim, good morning. Thanks for taking my question. I appreciate it. Jim, just in terms of the cadence of volumes for the year, it sounds like you’re expecting Food Care volumes to get better, particularly in the second half because I think Ted referred to some expected choppiness in the first half as you transition from fresh to frozen. I think, in Product Care, you’re talking about expecting some stabilization in global industrial activity but it sounds like that’s also more of a second half phenomenon, correct me if I’m wrong. Can you just help me with how back half weighted you expect this volume recovery to be just across the company? And any impact from coronavirus that you’re expecting in the first quarter specifically?

Yes, that’s a good question. I think we would probably say, based on what we know today, that there’s likely some push out of Q1 into Q2 due to the coronavirus. We did have talked – we did have some facilities down. Transportation is not moving really well right now in China. We do think, as we sit here today, though, that it’s just a movement within quarters and not a issue for the full year. Obviously, it’s a developing issue, and we’ll have to stay close to it. So I think it’s a fair comment on Q1. Probably, overall, Food Care in the first half of the year is going to be in that 1% range on volume. And stronger than that in the back half of the year as some of these equipment orders I talked about that are in our backlog are scheduled to deliver as well as some of the new products. So, overall, in the back half of the year, slightly above 2%. So a little bit of sequential strength in volume in Food Care.

Operator, next question, please.

Thank you. Our next question is from Rosemarie Morbelli with G.Research.

Thank you. Good morning, everyone. I was wondering if you could talk about the reason behind no longer ceasing operations in one of your manufacturing facility. And then your lack of presence, if I can qualify it like that, in the frozen food market, why aren’t you in it? And then how do you expect to get into it?

Could you just help, the first part, I got the why frozen food is impacting us, got that question. The first part just came through – we couldn’t hear.

Sure. It looks as though you are no longer going to cease operation in one manufacturing facility. Could you give us some detail as to why, first, you were planning in closing it down and now you decided not to? Unless I read – unless I misread it.

Are you talking about the comments on the coronavirus?

No, no. It was a comment on your – in the press release. It’s all right. I can get back to it offline.

Rosemarie, I’ll take – yes, I’ll take that offline. It seems we’re not sure to what you’re referencing.

If you’re talking about the credit on restructuring that occurred in the quarter, yes. When the company originally set up its reserves and it anticipated that it would shutter a facility in that region and as we got further into the implementation, the margins of that business and the cost structure of that facility and through some local sourcing that we did, we were able to improve dramatically the economics. And therefore, we decided that it didn’t make sense for us to go ahead and follow through on that action. So we reversed that restructuring into the GAAP results for the quarter. Of course, that’s called out as a special item, it’s not in our non-GAAP results. If that’s what the question was.

Okay. Yes. And Rosemarie, I’ll take the frozen one. Thank you, Jim. The question on why the frozen versus fresh is affecting us. It’s a good question. The protective packaging that we have with our Cryovac brand is what we offer is tremendous barrier protection on fresh meat, fresh proteins. When you go to – when you freeze it, you’d use a simpler structure that doesn’t use the same level of per barrier protection that the Cryovac brand has. So hence, that is not a strong market for us. How these dynamics are working, though, it’s quite interesting as trying to serve that China market quickly because of the issues, first with the swine fever, now with the coronavirus on how to get protein to that market quickly. It did shift heavy to frozen. But in the process, especially in Latin America, we have a strong presence and we’re at the table with the larger meat producers. They were using our bags to actually freeze. Also, when they’re freezing, they’re freezing larger carcasses. So they, again, wanted our protective capability in our barrier bags. So in the short-term, it actually – going frozen doesn’t support the product lines we have. Though, in the long-term, it will, because fresh is what is preferred. And even if they stay frozen, we’re in there in the automation change and we think where there’s some growth opportunities. So it’s really a short-term phenomenon. But we’re at the table and we think this will be a growth opportunity for us, probably more in the second half of the year than the first half.

And, Rosemarie, happy to take more clarification questions offline on that first question. Operator, we can take the next question, please.

Our next question comes from Anthony Pettinari with Citi.

Hi, good morning.

Good morning.

Ted, you referenced some of the success that you’re seeing with paper-based solutions. I was wondering if it was possible to quantify how big that paper-based product set is for you or how big that opportunity is. And I guess we typically think of Sealed as a resin-based packager. Is paper something that you’re making significant growth investments in? Or is it something where you could even potentially look to acquire?

Yes, probably don’t have the actual numbers, but I’ll just tell you how it fits in. The – we’ve had – we actually have had paper-based products for quite some time, and paper shows up in a lot of our products. Korrvu products is actually a cardboard solution with a film inside. Our mailers, we have a multiple set of different mailers with paper. The paper fill, very specifically, is paper for void fill, which is the paper versus plastic decision versus a Bubble Wrap opportunity. So with the question on plastics versus paper, which we believe it’s actually going to probably drive even more of our Bubble Wrap solutions by giving the market a choice, paper versus plastic. So as far as the percentage, and probably Lori can follow-up with you the exact percentage, but rather than give you a number right now, we can follow-up with that. We are seeing its growth, though, as we’ve introduced new paper products, growing. And I’d just rather not quote the wrong number. We can follow-up with you on that.

Yes. Let me just go ahead and jump in. I think I can give a bit of a dimension there, Ted. So if you look at straight paper, it’s a pretty small percentage, low single-digit percentage of the total Product Care sales, but we do have paper that’s in some of our mailers. So mailers would probably bring that up to mid-single digit part of the Product Care portfolio growing faster.

And it’s also in the Korrvu products, et cetera, et cetera.

Yes.

Operator, next question, please.

Thank you. Our next question is from Neel Kumar with Morgan Stanley.

Thanks for taking my question. In Product Care, just in terms of your expectation of stabilization in the industrial markets following inventory destocking, can you just talk about what gives you confidence that the inventory destocking is, in fact, over? And what are you seeing in terms of underlying demand trends in the industrial space so far in the first quarter?

Well, the first quarter right now is choppy for us around the world for what’s going on right now in China. But in the U.S., what gives us confidence is we’ve seen that slowing down. Plus, in looking deeper into the portfolio, we think some of our new products can help us fight some of that, the secular decline that, as you’ve highlighted, is out there. So we’re seeing that. And as I highlighted earlier to a previous question, we’re seeing what we’ve been able to do in Europe and move faster, so we think bringing our new products in, in the sustainability play, we think we still have an opportunity to turn that quicker. And the question was asked before, not seeing it turn to 2021, but we think we have an opportunity. And then the third area, just to highlight again, our acquisition of APS was one of the product gaps we had there in that portfolio in the automation, the equipment, the auto bag product, the side pouch. So, we think filling that product gap portfolio will help turn that quicker and see if we can actually turn that to a positive before 2021.

And I would just add that we have talked directly with our key distributors, and they’ve indicated to us that they have been doing destocking. So, their underlying sales rate is at a better rate, if you will, than what we’re posting because of the destocking. So, it’s really a combination of what we can observe directly through those discussions as well as our own internal data seems to be stabilizing, albeit at a level that’s not where we want it to be longer term.

Operator, next question please.

Our next question is from Mark Wilde with BMO Capital Markets.

Good morning, Ted, Jim, Lori.

Good morning, mark.

I wondered, Ted, if it’s possible to just give us some sense with Reinvent SEE of where you’re seeing the upside. And then just as a follow-on, I know that you’ve been trying to kind of reengineer the relationships on the distribution side for Product Care, so I wondered if you could just give us an update on that.

Sure. The first question is where we see the upside on Reinvent. Obviously, as we’ve been talking about since we’ve introduced it, the upside is we’re actually performing better than we had planned, and we want to continue that into 2020. One of the areas that we brought in to Reinvent is, really, could we bring the same discipline that we put in our cost structure and actually bringing it into the growth of our business as well. And what I mean by that is the tracking and tracing of initiatives that we do on cost, bringing that into our new product development, bringing that even into our sales opportunities. And so that’s underway, we put that in place in the fourth quarter. So I think that same discipline that’s been driving our effectiveness on our cost structure, I think – I’m pretty optimistic we’ll see that benefit in 2020, and we need it. As far as moving, your second part of your question, on where we are with our – or how we go-to-market in our Product Care business. It – the first, you’ve heard me mention and somewhat repetitive, best product, right price and make it sustainable. So, really working with our sales channels to make sure that we truly do have the best product. And the right price is really working with our customers through our distributors, through our channel partners. If we don’t have the right price, what do we do to look for more savings in their operations and also what other products do we need to bring in to the market? So that’s helping us. But also, being clear and direct with our channels, that the channels have to perform. And as we’re reinventing everything, it’s how we go to market. We have actually an e-commerce platform that we’re piloting that’s actually working ahead of schedule to make it easier to do business with, so our customers can actually connect with us online and use our service team, our distribution team, our direct team to really support and service our customers and the geographies where we serve. So, we’re making progress, Mark. I’m never happy we’re moving fast enough, but we’re – I think with our Product Care structure on the whole thing of how we go to market, how we make it and how we develop these new products, I think we have lots of opportunities to lots of opportunities to turn that tide around sooner rather than later.

Operator, I think we have time for two more questions, please.

Thank you. Our next question is from Arun Viswanathan with RBC Capital Markets.

Great, thanks. good morning. I just wanted to ask about the guidance, specifically. If you look at the EBITDA this year, $965 million going to $1.02 billion at the midpoint next year. That’s about $55 million of growth. It looks like you’ve assessed around $25 million for the acquisition. And so the other year-on-year $30 million improvement, I guess, FX, you’re saying negative eight. Assuming that the organic side maybe offsets that, is the other $30 million mainly in restructuring savings? Or how are you thinking about the bridge from 2019 to 2020? It would seem that there’s maybe a little bit more upside there, maybe on the price/cost side, if those resin prices continue to be benign. Is that right?

Well, keep in mind that the formula pricing is really driven by what we experienced in 2019. We are expecting kind of a stable resin environment in 2020. So yes, I think you had most of the bridge items we talked about earlier, $110 million of Reinvent SEE and APS being $25 million. With the takeaway, it’s largely being inflation of about $50 million and net price/cost spread of about $20 million. And then you hit on the unfavorable currency of $8 million to $10 million. So that kind of gets you to the midpoint. Again, if you look at our consolidated sales, there’s not a lot of what I’ll call sales upside beyond what we’re consolidating in with APS. Organically, volumes were up 0.5% consolidated. And that’s offset by this formula pricing. So that’s kind of the way we laid it out. We tried to do it kind of middle of the road, tend to be a little bit conservative here. But hopefully, hopefully, we beat the numbers in the market, especially in the Product Care business, where we are really being impacted by a weak manufacturing economy. A big chunk of the Product Care is cyclical and we’re not benefiting from the cycle now. But when that turns, we would expect to see nice incremental margins on the pickup in sales there.

Operator, we’ll take our last question. I think we have one more in the queue.

Yes, ma’am. Our next question is from Daniel Rizzo with Jefferies.

Hi, thanks for squeezing me in guys. Just question on – with the push in the frozen you guys kind of discussed, I mean, given that it’s kind of an easier product, would that suggest that there’s going to be kind of a mix headwind as you head into 2020 and 2021?

No, not for us, because where us because where they want to use our products, they’re – if I can describe it clearly, where they’re using us now for our product on the frozen, they’re using larger carcasses, that then bigger pieces. So they want our protection, they want our barrier capabilities and also trusted supply. So that’s not a margin mix, actually, it’s an opportunity for us. We don’t really compete on the very simple poly bag in a box for the frozen market, that’s very – that’s low margin, that’s something that we don’t compete in right now. But when they use our products when they go frozen, that will not be a margin hit for us at all.

So, operator, we’re going to close our call. Thank you all for joining us today. We look forward to speaking with you in the near future and safe travels to all.

Thank you. Ladies and gentlemen, this concludes today’s conference call. Thank you for participating. You may now disconnect.