Mark Miles: Yes. I think again, I don’t want to repeat what Kevin said with respect to April. I would echo what he said. I might add that some of our businesses in some of the more industrial categories had a bigger headwind last year from the destocking, especially our roll stock type products. So that’ll be a nice tailwind as we lap those comps here in the second half. I mean, with respect to your specific question, I don’t — in my prior answer, I would stick to, which is that $80 million I would spread slightly more to Q4, which sounds like is in line with the numbers you referenced.
Matt Roberts: Okay. Thanks, Mark. I appreciate that. I apologize if I missed this in the remarks, but did you say how much cash you received from the divestitures that you did in the quarter? And when you look out to that $1 billion opportunity, you explicitly mentioned divestitures, but are there any other considerations or deal type structures that you would consider? Thanks again for taking the questions.
Mark Miles: Sure. Yes, on your first question, I would say the proceeds from those divestitures were very similar to the purchase price for F&S that occurred right after quarter end. The future opportunities, we would expect those to be cash transactions.
Operator: Our next question comes from the line of Christopher Parkinson of Wolfe Research. Your line is now open.
Christopher Parkinson: Hey, everyone. Good morning. It’s Andrew Orm sitting in for Chris. So our main question really is, do we are there areas where you’re still seeing some destocking pressure, either in the past quarter or going forward into the third? And if that’s still true, how do you think channel inventories are looking as we get kind of towards the end of the year in areas where there might still be some inventory overhead?
Kevin Kwilinski: Yes. The only thing I would say where we would say there’s potentially some destocking still occurring would be in some of the health care parts of the HHS business, but even that I think has mostly run its course and the rest of our business there’s really nothing material related to any continued or ongoing destocking.
Mark Miles: Yes, I would echo what Kevin said. It’s occasionally you’ll hear reference to it, but I would say it’s very immaterial and I don’t think inventories are at an unusual level. I’m not hearing that or seeing that from any of our customers.
Operator: Our next question comes from the line of Ghansham Panjabi of Baird. Your line is now open.
Ghansham Panjabi: Hey, guys. Good morning. Kind of — Kevin as you kind of zoom out and you think about your portfolio and what’s happening with the end markets with obviously the global consumer being weaker and being very price sensitive in terms of how they approach their spending and so on and so forth. How is Berry’s portfolio aligned with that in the sense that your customers are very likely including in foodservice going to have to start stressing the value portion of their product mix. Just your thoughts on that and just given where volumes are in the industry, which is obviously at a low point, how would you sort of assess the competitive backdrop as well?
Kevin Kwilinski: Yes. I would say we feel very good about our alignment with the core consumer categories that we’re exposed to. We are strong in both branded and private label volume in both Europe and North America. So we are able to win even when there’s some trading down happening. We think the long-term trends in these markets when we look at the data and the projections, are positive and we will be exposed to market growth in the 2% to 3% or more percent range, and in some of our categories much higher than that. We are very focused on as part of this commercial excellence in making sure that we are prioritizing the white space with the best growth opportunities and we are very focused on using bolt-on acquisition, to give us capabilities and access to those higher growth markets and areas and that’s a key really the key lens as we think about where we should think about acquisition because we’ll get cost improvement synergy with any acquisition we do given our scale, but we’re really focused on how can we use acquisition to accelerate our organic growth for the long term.
Mark Miles: Yes. Ghansham, the foodservice part of your question, our portfolio is largely cups and lids for beverage and as you know, our customers continue to look to expand that category. It is a decent margin product category for our customers and so I continue to see them looking to expand that category, not the opposite.
Ghansham Panjabi: Mark, just to clarify, how big is foodservice for Berry at this point?
Mark Miles: Yes, it’s largely in our CP&A business, and I would call it 20% to 25% of that portfolio.
Ghansham Panjabi: Okay, got it and then for my second question as it relates to the divestitures and potential outcomes going forward, Kevin, what is the lens you’re looking at as you consider additional divestitures in the portfolio? Is it — I heard you mentioned in terms of CPG exposure, consumer exposure to increase that, but just some more color on that would be helpful.
Kevin Kwilinski: Yes. I mean, that’s really the primary lens is we have a core strategy to be a consumer facing sustainable packaging supplier and when we look at parts of our business that don’t have that profile, we really have to question is that where we should be investing our resources and capital, and that’s really what leads us to the list of opportunities. If the only reason for owning that business is that happens to use resin, that’s not a very strong reason and we have the ability to redeploy that capital in areas that we can create a lot more growth and long-term value creation for our shareholders and that’s why we’re going down the path.
Ghansham Panjabi: Makes sense. Thanks so much.
Operator: Our next question comes from the line of Arun Viswanathan of RBC Capital Markets. Your line is now open.
Arun Viswanathan: Great. Thanks for taking my question. I just wanted to ask a little bit more about what you’re seeing in April and I guess your confidence level. So I guess, what do you think drove the improvement in April? Was it increased promotional activity on part of your customers? And is that what gives you confidence that you’ll continue to see that continued volume improvement? Or is it maybe restocking or, just trying to understand what gives you that confidence that you’ll continue to see that improvement sustained over the next few months into the next year?
Kevin Kwilinski: Yes. I would echo that we have been confident in our guidance for the year from the very beginning and we haven’t changed it and it is playing out as we expected with the addition of April came in a bit stronger than we expected. So what’s changed? I think we are seeing more aggressive promotional activity and focus on brand building by our customers. I think we see a consumer that is increasing their level of consumption of categories that we are participating in, and it is unexpected and we’re talking about movements that are hard to predict on a month-to-month basis, but it’s basically what we thought would happen and it’s happening. We have continued to build momentum through the year and we think that will have continue to be the case.
Arun Viswanathan: Okay. Thanks for that, and just a question on the strategy going forward. I guess you noted that you will be looking to bolt-on acquisitions to bolster your presence in some of these growing verticals like healthcare and more consumer facing areas. So I guess real quickly, does that mean, A, that you’ll be getting rid of maybe industrial exposure? And then, B, just curious why you would opt to make acquisitions, the strategy to bolster that presence? And, are there opportunities to pursue that growth organically, granted Berry is obviously one of the largest consumer packaging companies in the world. So I would imagine that you could potentially go after some of those markets organically. Is it just quicker to do it by acquisition? And will it maybe returns would be higher that way? Or what is the strategy behind going after that acquisition based?
Kevin Kwilinski: Thanks. Yes, exactly. First the easy part. Part A, are we reducing our industrial exposure? Yes. The second part, we always look at what’s the best overall return for our shareholders of any growth strategy and in many of those organic growth by itself is in fact the best strategy and we’re executing against that and we’re doubling down on improving our ability to execute against that, but in some areas the fastest path and therefore the one that yields the highest return is to acquire a small business that you can scale out and replicate its access to technology or to a specific relationship or geographic market that you want to play in in a strong way and it’s just a much better return than just going your own way and building organic and we’re very conscientious of that, and we expect to do that successfully and do it within our stated leverage range.
Operator: Our next question comes from the line of Mike Leithead of Barclays. Your line is now open.
Mike Leithead: Great. Thank you. Good morning, guys. Just one question from my end. I want to ask on the Glatfelter transaction. The markets obviously had some time to digest it and if I look at Glatfelter share price today and relative ownership of NewCo, it seems to imply a NewCo equity value of something like $800 million which is quite a bit different than the $1.8 billion valuation you laid out last quarter. So I guess when your team looks at that, what do you think the market’s missing? Is it just it needs to better understand it? Or perhaps do you think there needs to be something different in capital structure or something else just to better realize the value in that transaction?
Kevin Kwilinski: Yes. I think number one, we have a we’re in a bit of a holding pattern and there isn’t a short-term incentive for people to buy in until we get closer to the transaction closing. I think that by far and away the biggest issue. When we look at the actual results that we entered into the transaction on in the quarter. We saw what we thought we would see in the quarter. We are confident that we have seen the bottom of the cycle and we are now on the upswing and we have an improving business, and as we continue to do the work on synergy, we see tremendous upside to the synergy that this business will be able to deliver. It’s going to be the biggest player in the nonwoven space and it is going to be a very strong successful company and we are putting excellent leadership in place and under Kirk coming from the long history of Berry Management.
So I think overall we think the market is just getting it wrong and the biggest factor is we just need to get this thing closer to close and let them move on.
Operator: Our next question comes from the line of Michael Roxland Truist Securities. Your line is now open.
Michael Roxland: Hi, guys. This is Nico Piccini on for Mike Roxanne today. I appreciate you taking my questions. I guess, first off, I think you’ve mentioned previously that European assets might be more advanced than the U.S. in terms of the process and operations bench point, both to the U.S. and other regions. How has that progressed maybe in your initial findings, as you benchmark those assets against your operations elsewhere? And is there any low hanging fruit that you can address quickly?
