Good day, and welcome to the TriMas Fourth Quarter and Full Year 2014 Earnings Conference Call. Today's conference is being recorded. At this time, I would like to turn the conference over to Sherry Lauderback. Please go ahead.

Thank you, and welcome to the TriMas Corporation fourth quarter and full year 2014 earnings call. Participating on the call today are Dave Wathen, TriMas' President and CEO; Bob Zalupski our new Chief Financial Officer, Mark Zeffiro, our Cequent Group President. Dave and Bob will review TriMas' fourth quarter and full year 2014 results, as well as provide details on our 2015 outlook. Mark will provide an update on the Cequent spin, and after our prepared remarks, we’ll open the call up to your questions. In order to assist with the review of our results, we have included a press release and PowerPoint presentation on our company website, www.trimascorp.com, under the Investors section. In addition, a replay of this call will be available later today by calling 888-203-1112 with a replay code of 3786796. Before we get started, I would like to remind everyone that our comments today, which are intended to supplement your understanding of TriMas, may contain forward-looking statements that are inherently subject to a number of risks and uncertainties. Please refer to our Form 10-K for a list of factors that could cause our results to differ from those anticipated in any forward-looking statements. Also, we undertake no obligation to publicly update or revise any forward-looking statements, except as required by law. We would also direct your attention to our website, where considerably more information may be found. I would also like to refer you to the appendix in our press release, issued this morning, and included as part of this presentation, which is available on our website. With the reconciliations between GAAP and non-GAAP financial measures used during this conference call. Today, the discussion on the call regarding our financial statements will be on an excluded special item basis. At this point, I would like to turn the call over to Dave Wathen, TriMas' President and CEO. Dave?

Thanks, Sherry. Good morning. Thanks to everyone on this call for your interest and attention to TriMas. Our view 2014 is a year that kicked off a new set of transformational improvements for TriMas. While we faced external and internal challenges throughout the year, we have taken many actions to improve our company going forward. You’ll notice that we have reorganization or restructurings in the majority of our businesses, including those which have been - achieve higher margins. We are focused on those areas that we believe will drive value for our customers, shareholders, and employees. Throughout this call, we’ll provide insights into why we’re excited about TriMas, our businesses, and the prospects of the future. We have several large projects under way, and a couple of key people and new roles, which you will hear from today. But first let me comment on 2014 on slide 4. Despite the slow growing economy and other economic uncertainties during the year, TriMas achieved $1.5 billion in sales representing growth of 8%. Externally we faced slower market growth rates in Asia and South America, Europe remained flat and the U.S. stayed near 2% GDP growth. So I’m pleased with these top line results. We attained the full year EPS of$1.92, which was in the middle of our range, absorbing a $0.01 related to the impact of the Allfast acquisition and its related financing, as well as increased headwinds in the fourth quarter related to currency, rapidly declining oil prices, and the port slowdown on the west coast. We have, of course, already reacted to these challenges and we’ll continue to react as required in 2015. We also continued to refine our business portfolio toward higher growth, higher margin businesses. We completed strategic acquisitions in Packaging and Aerospace, disposed of a lower margin…

Thanks, Steve. And I’m pleased to share with you today the progress our team has made for the spin in Cequent businesses mid-year. It’s an exciting time for us and we are well engaged in completing this project. The project team has made significant projects - progress toward being ready to be a standalone public company. First, we've decided on the company name Horizon Global Corporation. This is an important step in creating a new identity for the company and our employees. This name selection points to us being broader than the products and markets we serve today and embodies our aspirations of growth for the company. In addition, we are well underway and developing our organizational precepts, vision, and mission, all of which will support the company culture we aim to create. Second, we've made real progress on aligning the organization with how we’ll operate in the future. As you may have seen we have selected our CFO for the company Dave Rice. Our current TriMas and Cequent employee, Dave joined TriMas in 2005 and brings more than 30 years of financial, audit and leadership experience to the role. I’m looking forward to the partnership we’ll form in leading Horizon. In addition we've begun combining organizations in the Americas, which have historically been run as separate businesses of consumer products and performance products. The teams have been identified in our line for what we need the Americas business to become, a more efficient part of the enterprise. As such, the team is working on the synergies of becoming one company. These synergies will mitigate the new burden expected of standalone public company costs. The team knows the goal and is diligently working on these actions. We have also begun the prioritization of our strategic platforms for Horizon. We've identified…

Thanks Mark. Mark has been a great asset to TriMas and I appreciate all his contributions throughout his time here. At this point I would like to shift gears and have Bob Zalupski discuss our financial highlights. But first let me share why I’m so pleased to have Bob as TriMas' Chief Financial Officer. Bob’s entire career has been focused on all aspects of finance, from audit to treasury, to reporting and tax. Bob has been on point at TriMas, for our financing and bank relationships, which have served us well. He has also been leading our corporate development initiatives. He has long-term positive relationships with the audit community and rating agencies. And highly important to me, Bob is a true team player, has strong, positive relationships with TriMas division presidents, and financial teams. And clearly has TriMas’ success to continue this improvement to the top of his agenda. Bob?

Thank you Dave, for the kind introduction. I am excited about the opportunity to partner with you and our business presidents, and my new role as TriMas CFO. And look forward to the challenge of continuing to prove upon TriMas' valued proposition for our customers, shareholders and employees. I will start my comments by providing a brief summary of our total company performance for the fourth quarter, beginning on slide 10.TriMasreported record Q4 sales of $351 million, a 9.5%increase compared to fourth quarter 2013. This increase was driven, primarily, by sales growth in our engineered components and energy businesses, and sales resulting from the acquisition of all facts. These increases were partially offset by the unfavorable impact of currency exchange of approximately $4 million in the quarter. Operating profit for the quarter increased 24% to $29 million, or 8.3% of sales, which is an improvement of 100 basis points as compared to Q4 2013. Q4 2014 income increased 27% to $17 million, despite absorbing higher interest in tax expense, and we achieved diluted EPS of $0.37, as compared to $0.29 in the prior year. Turning to slide 11, it summarizes our full year 2014 results. For the year, sales increased 8% to $1.5 billion, with sales growth occurring in all six segments. Of that sales increased approximately 75% was due to acquisitions, with the remainder resulting from organic initiatives. These increases were partially offset by the impact of a $10.2 million decrease, related to the sale of our Italian rings and levers business within packaging in Q3 2013. It results a $6.3 million of unfavorable currency exchange, as well as a decrease of $4.5 million in sales related to the closure of our less profitable Brazilian manufacturing facility, and branch in China within our energies segment. We are pleased that…

Thanks Bob. So as Bob mentioned I’m now going to look forward and comment on our guidance for 2015. I’d like to start with sharing our baseline revenue and margin assumptions for each of our operating segments for 2015 based on our current view of markets, currency, oil prices and our own plans and projects in business. Packaging strong performance to continue into 2015, even with the headwind of 2% to 3% related to the strength of the dollar. Operating profit should stay in the low 20s, even with building out global tech centers, including one in India during the year. This tech centers are a piece of our commitment to our global customers to support them with the right products in the markets they pursue. Aerospace growth will be driven by the addition of Allfast, plus over time, the additional new product opportunities within the overall Allfast Monogram and Mac Fastener’s product portfolios. In parallel, we will prune and harvest some less attractive product lines. We expect margin improvement as we move through 2015, as we work through the operational challenges we faced in 2014. Martinic Engineering is showing progress, and Mac continues to improve its product mix to distributors, both of which should yield higher margins. Tom Aepelbacher has added sales and operating horsepower to his team, including folks with significant industry experience. They are focused on long-term sales growth and attaining longer term margin levels and compete with packaging for highest marks. In Q4 2014, Energy revenue increased 16% incurred orders improved, but we know our Energy customers have cut CapEx budgets and short term changes will occur. So we are modeling low revenue growth in 2015. As I previously discussed, our main focus in this business is margin improvement, via manufacturing cost out, and product mix…

[Operator Instructions]. And we’ll take our first question from Scott Graham from Jefferies.

Good morning. I have a couple of questions about the segment assumptions for 2015 that’s short. And really, thank you very much for that chart, that’s really helpful. The assumptions that you’re making for within oil and gas overall, Arrowed down to 25% to 35%, but I assume that you’re kind of thinking a similar type of number. Maybe not quite as bad, but a pretty down number in the energy segment as well. Could you give us just an idea of maybe bracket what you’re thinking in that business?

In the interview segment, I think what was - you can tell we’re seeing a lot of growth right now, kind of recovery. Scott, what it comes to us, we projected that momentum of growth forward and then pulled it back down due to the customers pulling CapEx out and it winds up, we marveled at about flat revenue. We’ve got a few upsides going on, with some new big programs. We know there is a pretty decent recovery, and heavy project work, new builds, gas compression and all that stuff. And so we put it altogether, and it feels essentially flat. So oil price impact, for sure offset by some big multi-billion dollar projects that we know respect in that.

Right. So it sounds to me like you’re expecting whatever kind of flattish out of energy. Most of the energy segment serves the oil and gas market versus the petrochemical market, right?

Of course most of it is refineries and processing plants. We’ve seen quite a bit of growth in oil production for, I’ve mentioned before, under the ocean spec for platforms where they use real high end fasteners, because of corrosion. That’s all upside for us, and it’s all high margin business. So when you throw that all in, again, we come out flat, but -

I know you work a lot this season, that you’ve --. Apologies I know you work a lot with the E&C in this business, so you’re not hearing them say that some of these multi-billion dollar projects that you’re specked in at, that these projects won’t --?

We’re actually not hearing much of that. I mean we are hearing people cutting CapEx at the refineries, we know about there’s strikes going on. And the one in the refinery’s what - we don't call it bench for salary folks. Yeah, we've been trying to cross-reference with what other people are saying. The couple of big projects we’re on, they’re all kind of one-off events, seem to be still on track.

And there has been some requests, Scott, from those customers for, what I’ll call price reductions, are not necessarily cancelling the deferral of orders, but looking for some price give back. Naturally, we’re negotiating those quite heavily, but there is some of that pressure we’re seeing as well because of what’s going on with oil.

Thank you for being very forthcoming with that, I appreciate that. My last question is this, in the aerospace segment you’re expecting a pretty big improvement in the operating margin there. Is there any way to kind of sort out how much of that is Allfast mix versus base business margin?

Well to answer that is of course, we typically don’t get into the margin assumptions around the individual businesses. But what I would say Scott, is that clearly the Monogram margins were lower than we would like, or even expect for that business. The new management team is really heavily focused on improving the efficiency of, not only the manufacturing within Monogram, but also as it relates to Martinic and Mac. The Martinic business, while smaller, was a fairly sizeable drag on the margins in 2014 given, certain adjustments and other kind of one-time clean-up activities that occurred in that business. Going forward, we see that business returning to its historic levels of profitability, and similarly we would expect Mac to be at comparable margin levels. So in that sense, that’s kind of mid-teens, in that business, which would be a significant - those two businesses, which would be a significant improvement over the 2014 results.

That's great. Thanks a lot.

Scott, part of the advantage of my goal is, if I need to be brutal I can be. And I was pretty brutal about some parts in that business to say - on the positive you’re part of the diversified company that can handle some bad times. On the other side, you’re part of diversified company that can put this behind this and move on, prove to me it’s worth staying in this business. And I give the team - some of us are good people, I give the team a lot of credit for - not going under and - what’s good and what’s not. Sometimes in times of stress, you get much faster response, I’m pretty upbeat. I also have very high confidence in that management team. Tom is as good an operating manager as I know, he’s also - he and the folks from Allfast, have recruited some people that we would have never recruited as Monogram. And we’re a much bigger and more attractive business, we’ve got a marketing guy who came back, who had left. We’ve got an office manager who is Tom, a little younger, and in the industry. So got the customer relationship interest and all that so there’s a lot of positive indicators in that business.

Thanks a lot.

I feel pretty good about it.

And next we’ll go to Steve Barger with KeyBanc Capital Markets.

Hey good morning, it’s Ken Newman on for Steve. Just curious, if you could talk a little bit about the neutral cooperation agreement with engaged capital. I think the release states that engage can appoint its own principle to the TriMas board at its request in 2016. Just wanted to get your thoughts on why agree to the agreement, and what does that get TriMas?

Well we’ve got is a very first class board member joining, Herbert Parker. I would cement that any of you who know him, or would spend time with him, we’d get the same opinion as me. Herbert Parker is a lived around the world, dealt with lots of things, helpful, kind of a long time global CFO and Operating Manager. And he, like anything, part of a function of board is to sort out, what do you focus on? What do you focus less on, and be part of a team? And he - so we got Herbert Parker which I feel real good about. The agreement with engaged capital, I would say our legal for general counsel, Josh could explain it looks almost stereotype for this kind of thing. That if in the future the focus on engaged capital feel the need, they do have a right to appoint principle as a board member, we’ll see. I would say for now, I like the outcome, and we’re in a government mode.

Got it, and then. And then switching gear to your - it looks like you had about a $7.5 million restructuring charge in energy this quarter. Can you provide some color on what that charge consisted of, and what’s the expected payback on that charge, and as well, if you could just talk about do you expect a similar type charge of that magnitude going through the course of the year?

The majority of the charge in energy related to some restructuring activities in Brazil. And in doing that, a big chunk of it was basically a lease facility that we’re in, that we have now exited. Any time you discontinue a business, or an operation, in a foreign country, there’s the cumulative translation adjustments or losses, in this instance that we’re tied up in CTA, which also get expense to the P&L. So that was the majority of the 7.1 million charge, the remaining was ancillary cost as well as employer related kinds of severance.

You will see costs in 2015 we're moving, we're ramping up a plant in Mexico and they’re down plants in the U.S. you’ll see cost related to that going forward. I’m not being shy about really getting busy in energy making the moves that bring it back to where it ought to be.

Understood and then just one more for me. Just comment on how we should be thinking about - full conversion this year. I know your guidance came down from last year, I’m just curious if you’re expecting for the conversion - for the spin-off and also wanted to get your thoughts on what that means for capital allocation in the near term?

Well we're expecting very strong cash flow generation from operations, again, in the current year Ken. And I think maybe the difference between this years and last is that we've got a much higher level of capital investment plan relative to building out - our manufacturing footprint in packaging in Asia in the related technical centers, as well as the relocation of the Lehman’s manufacturing capacity to Mexico. So that will reduce the conversion percentage as it relates to net income, but again, I think the underlying principles of cash flow generation will be, again, very strong.

We still have strong metrics on working capital as a percent to sales and efficiency of how we use cash in each business. We're pretty, that’s pretty ingrained in us by now.

And next we’ll go to Andy Casey with Wells Fargo Securities.

Related to - if we could go back to engaged capital I’m just wondering, did you receive any advice from them prior to your decision to spin-off Cequent, or would you describe any advice that may have provided as more forward looking?

You know the answer to that, we don’t talk about discussions like that. But the Cequent spin was - you know that the idea of doing something different, Cequent has been around for a while. You and others have asked us about that. I would - if you could eavesdrop in the boardroom in previous meetings, that was a TriMas Board decision, certainly driven by lots of inputs by investors and analysts and industry and all that, but that was a TriMas decision. I would call it a tactic.

And then an additional question on the 2015 outlook, you were very clear on the oil related demand impact. And you may have touched on this, but could you discuss whether any of the commodity price declines the market has seen, may drive an input cost tailwind. I guess overall are you including in positive net pricing, meaning priceless cost in the outlook?

I don’t know that we're seeing, I would describe it as tailwind. I mean in certain of our businesses where steel has an impact and Norris Cylinder notably, the price downs there have been available to us for a while now. I think the issue that we potentially see is their pricing pressure in terms of givebacks to customers, relative to their perception of declining prices and commodity costs.

I’m sure you hear this a lot - the refined products, like plastic resins, have stayed remarkably robust. Once you think it would drop immediately, but overtime sure, we will take advantage of it, our job is to hang on to selling prices longer than the - so we do get benefit from commodity price reductions as it goes on. It’s - you’d think there’d be more of a strong dollar and all that, but we’ve got global sourcing organization, we're on top of all that. And it’s been a slow move down. In finished products like we buy.

And then couple of questions on kind of historical, first on Q4 in the P&L you called out a 4 million hit due to dispositions. Was that all related to Aerospace? Was there any better impact, I’m just wondering where that - segments, and if there was any tax effect associated with that?

There’s a $4 million reduction that you’re referring to, I believe, was the divestiture of our Brazilian business.

Okay. And then on cash flow you had pretty favorable changes in receivables during the second half of the year. Can you provide a little bit more color on what drove that?

We are always focused, Andy, on improvements on our working capital efficiencies. If you look across our businesses, we’re generally speaking, pretty darn good about reducing the day sales outstanding, particularly at year end. So in that sense, I don’t know if there’s anything particular that I would point to other than just normal operating practices.

I will tell you, I’ve been a broken record in operating reviews about, interest rates are low. We forget what it’s like in higher interest rate times for receivables and payables, but it intentionally goes up. So get busy and then of course it’ll go up, but we all know interest rates will climb and get tougher. And we’ve got to be on our gains in control in working capital. And so - not that that’s a specific answer, but we pay attention to it even though the low cost of money could let you go to sleep about it but you can’t.

Okay. I’ll pass it on. Thank you very much.

And next we’ll go to Karen Lau with Deutsche Bank.

Question on Energy. It sounds like the refinery maintenance is coming back a little bit, but yet you haven’t seen the mix improve, I was under the impression that the turnaround starts to happen, your mix will kind of come along with it. So is there something structural going on that is depressing the mix do you think?

I mean some of it is the timing that you tend to order the standard product sooner and get that all delivered and then the specials become fast turnaround style. I don’t think there’s anything structural with that. I’m expecting improvement index, the - and the team in that business have really gotten proactive recently. And I mentioned some of that, I mean it’s everything from making sure we're selling all the higher margin products every place in the world. Some of that’s education of our own sales force and branches, resetting some of our setting system, so it’s not spread across specific. Karen I’m going to say stay tuned, because we are expecting to see that impact. I want it sooner too.

Okay. And then I just want to follow-up on the question about price costs. So it sounds like you were not expecting any meaningful boost, for instance in packaging, which I believe resins and steel, and portion of the cost of goods, but you’re assuming a benefit to margins in the near-term based on lower prices?

No, we have pretty tough customers about that and while we will always try to come out ahead on the timing of price downs - but no, we're not modeling that way.

We just haven’t seen it in actuality that would suggest it’s an appropriate thing to do at this point.

I mean you’re exactly right, it could be an opportunity in times like this. And, but again I’m not one to count on opportunities until I really see them, but you know we’ll try.

And aside from packaging, I mean you mentioned little bit on the cylinder side. There could be some pricing pressure with regarding tough customers asking for some sort of price back given lower high commodity prices. Do you expect that dynamic to happen in any of the other segments?

I think there’s a lot of that going on Karen. I think there’s a lot of price pressure on in this - we're all everybody I talk with, I’m sure is dealing with the same thing. You’ve got muddy low inflation, you’ve got commodity softening, strong dollar. Strong dollar makes - people who sell in the U.S. from outside get aggressive, they may look aggressive. So there’s a lot of price pressure.

Okay. And then last one, could you help me a little bit with the free cash flow how to bridge the component. I realized the CapEx component is what, like maybe 30 million higher year-over-year, but I was under the impression that Allfast, given its high EBITDA margins, was going to boost free cash by 30% year-over-year. So are there may be like charges incorporated in that $60 million to $70 million number?

No, not being specific in that regard Karen, you’re correct, we do expect the benefits of Allfast strong cash flow generation as a positive, obviously. I think you have to remember the benefit we saw this year in terms of much higher free cash flow generation through improved working capital, that’s not necessarily a benefit that recurs. And again, in 2015 we have a much, much higher level of capital investment plan that we had in the current year, which will approximately offset the improvement or the add, if you will, from Allfast.

Okay, makes sense. Thank you.

And next we’ll go to Robert Kosowsky with Sidoti.

Just going back to that $4 million charge that’s in the P&L so is that included in your $29.1 million adjusted operating profit?

No it isn’t, it’s one of the special items.

So it’s included in the $7.5 million of severance in business restructuring costs?

Correct.

Okay, and then secondly it seemed like corporate expenses stepped down pretty nicely in the quarter about $6.7 million, was there anything behind that especially sequentially? Is this a new level with just bonus accruals being reversed because Europe didn’t come in as planned, just kind of thoughts on that.

Yeah, clearly there were lower incentive comps related accruals and adjustments, so that was a portion of it, but again as we went through the year and we saw certain of the challenges that were coming at us in the back half. We appropriately pulled back in terms of corporate office expense as well. So is that through run rate normal? No because obviously the incentive comp arrangements get reloaded and there’s the net inflationary pressures on, in terms of married increases in the like.

Okay. And then finally in your - outlook you fall for mid-single-digit revenue growth and that seems like a step down from kind of high just to low double-digit growth rate that were accustomed with Packaging. Was there anything behind that slowdown? And maybe you could talk about the outlook from U.S. also international?

Remember Packaging gets hit on currency translation, because of the amount of sales outside the U.S., so that’s the big delta.

So the mid-single-digit - well sorry --

But other than that, again I would say we are - we know what we've got - and what we can count on. We're viewing Asia as good, but softer than it used to be. Plenty of people think Europe’s going to rebound, but again, I’m not going to count on that till we see it actually occur. So I mean you might get away with accusing us so far. Not counting on some potential upsides we’ll see. It’s also true, and this is a structure of the business, we've got a lot bigger, we are dealing with some new bigger customers who have a lot of control of their own wrap-ups and switches and that sort of thing. We aren’t as used to them as some of the customers were, so we're not going to be aggressive about things that are in their control. We’ll make sure we can serve them when they’re ready for us, but we're not going to forecast the revenue till we’ve really got it in hand.

Okay and so that mid-single-digit growth rate, that’s inclusive of the 2% to 3% headwind?

Yes. Maybe - once clear on that.

And we do have three questions left in queue. And next we’ll go to Matt Koranda, Roth Capital Partners

So it looks like in Q4 you guys already saw a bit of the impact of the west coast port delays in the packaging segment. But I was just wondering how we can think about the near-term impact, maybe the Q1 impact by business segment? And are you comfortable it’s all fully factored in the year 2015 outlook?

I think we’ve got it factored into our outlook, I mean as it’s working out, it’s hitting harder in first quarter. And, but you could probably, with the right telescope, you could count the ships right? I mean and it’s another couple of months to get it through this system, but that said, it hits packaging hard because we do quite a bit of production particularly for - in Asia and move it this way. It gives us some fits on some commodities that tend to come from Asia, like some steel product out of Korea for Norris but we could re-route some of that. It - castings for Arrow, nobody in the U.S. runs foundries anymore. I mean castings, while we've moved a lot of those in the Mexico. Mexico is mighty busy, that’s been giving us some issues. I could put a - somebody named [indiscernible] 7, 6.28 who runs our logistics for us and she could take you through everything. And we re-routed, and we found that where we've bit down and decided to airfreight, that’s a long answer to say. I think it’s going to be first half before we see it flush out.

Mark do you have impact at Cequent?

Yeah Matt, when you think about the Cequent business obviously a good portion of supply chain comes out of China as well, that’s obviously been re-routed to other - we're seeing the fact that we anticipated some of this and re-routed to other locations. It’s at least to reducing the risk of not having the right inventory for key customers. So to that end, if you really think about it, you might see pressure in the Q2 numbers as you start to think through help fight, though we’ll actually roll off the balance sheet. So I would tell you that the team’s done a great job in terms of re-routing efforts to ensure that our customers haven’t been affected?

Okay, thanks for that guys, that’s helpful. And one more from me on Energy, just wondering in terms of the move from Houston to Mexico, if you could give a little bit more detail on where you are on the process? Maybe, share potential timeline here and maybe some milestones that might be associated with the move. And I know Dave, I think you mentioned earlier some lessons learned from the Cequent move, if you could just elaborate on some of those lessons and how they’re on form to move in Energy?

We have a plant, we are, and we’re doing the plant improvements, air gliding and all that kind of thing. Equipment is, much of it is on orders delivered. So all that is underway, we did move out of the Cequent team review the - have been real active in building new plants in Mexico, and its helped us with everything from the logistics of crossing the border and timing, to help and recruit new plant manager and that kind of thing. So it is at that stage that we’ll have initial production in the pretty near future, certify that kind of thing. So that’s why I’m saying we’ll see the impact to that and are starting to ramp up in second half. We did so far away yet. The lesson learned, and we've talked about it quite a bit, the real lesson learned for me at Cequent, and I’ve lost count of how many projects like this I’ve been involved in since, call it the 80s. Mexico is so much busier that you can’t quite count on the supply chain like you used to. It will catch up, but even though you find the supplier for brackets you need made outside, it takes a while for that supplier in Mexico to pitch it into their schedules. And a while might be months, and we are configuring the initial ramp-up of the energy plant where we will - and it’s partly the physical location of Houston versus Reynosa, being able to move, call it raw materials and supply chain things from the U.S. into the plant, rather than to outsource in the - Mexico. So that didn’t sound all that profound, but it was a decision to make the ramp-up go smoother without getting caught out with vendor problems. And of course we also have the physical advantage of, call it, used to be in a master distribution point for that entire company that it’s not so far away from Reynosa, we don't have to move - move the entire warehouse system at the same time. And so we don’t have a parallel there, and so it’s simpler, and we’re trying to - we're derisking it. The folks who work on it, - I get to hear the output, and it’s important enough that I go out of my way to travel to a debrief meeting and we talk about how will we de-risk this? So there’ll be any time start-up as share stumbles, but I think we have learned and this one will stay tuned, but I think we’ll be happy with the way it ramps.

Okay. Thanks for the color and then I'll jump back in queue.

And next we’ll go to Walter Liptak with Global Hunter.

My question is about the aerospace segment, and your comments that the aerospace distribution channel’s still choppy. I wonder if we can get some color about that, and the way you made sound about the guidance, is that all the 50% revenue growth’s coming from Allfast, is that right or is there also some growth expected in that segment?

Well the majority of the growth, Walt, is attributed to our full year of Allfast being included. So I think sales lies - you can expect that to be the case, I think relative to what we’ve seen in distribution customers, a couple of the major ones, VEO [ph] space and then Wesco. They’ve undergone some of their own I guess, legal entity or corporate transformations, our BE I think spun off, the distribution business into KLX, but that was a fact, of I believe, was the start of the year. And I think what we saw in fourth quarter was pull back in oil patterns, as now as a separate company, they were preparing to manage their inventory levels in investment and working capital in the like. So it’s a little different behavior that we’ve seen, in at least the first part of 2015 here. We’ve seen stronger order patterns from BE in particular. Wesco was acquired by another company, and again, I think again, we’re seeing I think as of yearend, some changes in ordering patterns that reflective of that ownership change. And again, it’s hard - for the first couple of months in 2015, indicated a bit higher order patterns that we expected. So we’re cautiously optimistic in that regard.

Okay good. And then I wanted to ask one about the spend and as we’re getting closer to it, any changes on - associated with it? And do we start to see any of those - flowing through in the first quarter - the second quarter?

Have you been listening to the questions I get from my board members? Look, the answer is our early estimates have proven to be pretty accurate, but I don’t want to pretend we know it all yet because his is a big, legal structuring kind of project. So - but so far so good. I mean as you know, we’re pretty decentralized on - sequence is quite separate. And so we probably have a laid up what some other companies have dealt with in this kind of thing.

Yeah, well specific to transaction related costs - we’re obviously right in the middle of it, so we’ll start to see those slope through in Q1 and obviously Q2. The ones that are directly related will be out boarded, as special items and will obviously be disclosed in our future filings.

Right, so we’ll some - I mean you’re going to have added costs and things, you’re saying that we’re going to see some of those in the first quarter?

We’re clicking right through those, but we’ve said, it appears to be clicking right away like we planned it, and we’ll keep at it.

Okay. Any additional thoughts on the debt on the horizon business might be --?

It’s a little early yet, we’re talking about it but we will as soon as we can, we will share all that.

And next we’ll go to a follow up question with Scott Graham from Jefferies.

I’m sorry, I just want to ask a little bit more around energy. The - exposure that you guys have is housed involved with the energy components businesses, and I’m just hoping that is, if you wouldn’t mind Dave, if we just take out the petrochemical piece of energy, which I consider to be a very different set of multi-dynamics in ’15 than oil and gas. And then add to that the total form Arrow Engine, which is mostly oil and gas, is that about 15% or 20% of your sales --?

Yeah, if the way you’re trying to describe it is energy, it sounds a little high, but -

But maybe more toward the 15%?

Yeah. And remember, I’m trying to - whether it’s - chart of the segments of me talking about, with Arrow, it’s the engines that drive pump jacks --. The gas compression part of the business and metering devices and all, those tend to be a little bit more just on volume being moved, not new the thing that’s way off is new --. The volume of oil and gas moving - today’s the same, the demand number stays the same.

I think - is going to be a little bit more widespread than that, but --

We can cover with that, and I tried to - but right now, we can - pretty far, but we’ll see.

Well I think the variable here Scott, is - what does the price of oil do as we get into the second half of 2015 is, it stayed kind of where it’s at today. Does it decline further or do we see some bounce back? I think to the extent there’s a bounce back, we’d expect there to be less of an impact. Obviously if it gets worse, it could prove to be more negatively impactful to the top line, certainly in aero and possibly even so in laymen.

I’m with you, but then sort of the - to that question is, if we’re talking 15% of sale of total company sales, I thought it’d be much more of that in the energy segment and energy components. You’re still forecasting an obviously healthy margin expansion in energy in the business that has most of your oil and gas. And you’re kind of expecting just slight decline in edging your components because of what you’re kind of seeing in the order book for Arrow. So that I know you guys are as forthcoming as they come, so obviously there’s going to be some restructuring savings that are going to hit those businesses. And I’m just wondering if you can kind of get a little more granular on some of the dollars you expect or structuring - to those margins?

Again, as we look at energy Scott, and maybe some of the expected improvement in margins there, a lot of that will be - coming off from very difficult challenges in the current year. So I would certainly view it as a function of some massive restructuring that we’re going to do - further what we talked about in terms of moving, certain about production capability from Euston, New Mexico. And the margin impact again, I would come back to, we see more of that happening in the Arrow portion of our business. As Dave mentioned, we’ve taken actions to reduce the cost structure in that business, commence - pull back in engine orders. And - that isn’t visible because it’s part of the segment that includes an all cylinder activity. So I think in the main we’re pretty comfortable with where our outlook is with respect to margin with - overall.

So what you guys are saying that you need to focus on margins for ’15, it doesn’t’ necessarily mean restructuring across the businesses like that, I feel across the businesses like I thought I heard earlier, but in fact just better execution avoiding some of the pitfalls that you had last year and what have you?

Me giving the businesses, I’ll say, permission to de-emphasize in lower margin lines, we take a hit to the growth rate but exchange for higher margins, a whole lot of that kind of thing.

[Operator Instructions] And it looks like we have no further questions. I’ll turn the call back over to speakers.

We really appreciate the attention and the input. I am feeling like - we're all going to like 2015. We're all dealing with a whole bunch of stuff, but that’s what we do. And so I would ask you to, I’d ask you to have that as a takeaway from this, that we've got a lot of good stuff going on, big and smaller. And we've got a lot of good people getting it done. And I’m happy with where we're at, so much to do, but thank you again.