Andrew Kuske: Thanks. Good morning. Apologies if I missed this, but could you give us some context on where Clarios is today versus your initial underwriting? And obviously, there’s some messiness around that because we went through a pandemic. But I guess the question really the just to it is the extent of the transition from lead-acid batteries to batteries more involved in EVs is tracking ahead of your initial expectations.
Cyrus Madon: Cyrus here, and then I’m going to turn it over to Mark to give you a little bit of color there. But I don’t have the numbers in front of me specifically, but I can tell you, Clarios is performing really well and more or less what we expected. I think I’ll turn it over to Mark. But I think the short answer is that the upside opportunity here from transitioning into a higher specification battery is pretty interesting for us.
Mark Wallace: Yes, Andrew. Hi, it’s Mark Wallace. So a couple of things. One, kind of you mentioned it, right? We went through COVID, high inflationary environments, all the macro challenges. But the one thing is the business continues building out and improving its what I call profit per unit or EBITDA per unit, that continues to make not progress since the acquisition. And given the fact that we had a lot of inflation to catch up to that happened in our fiscal 2022, we think that will be a continuing tailwind for us in our fiscal 2023. So actually a very good spot with how the performance is shaping up in the company today. As I mentioned in my prepared remarks as well, we’re going to get a pretty significant revenue and margin expansion due to AGM batteries being sold into the aftermarket.
That’s going to be a significant part of the next kind of decade story of the company while at the same time in my prepared remarks, I mentioned that we had a target to win 200 new battery electric vehicle platforms. Of that, we’ve won 130. In every case there, those are all our conventional battery technologies, though we do have a lithium offering in the market today. The vast majority of our customers at this stage are continuing to choose our conventional battery technology like AGM.
Andrew Kuske: Okay, that’s very helpful. And then maybe just a follow on question, if you think about your – and then there’s obviously a bunch of inflationary impacts have happened. So if we think about normalized margins into the future on a per unit basis, where do you think that lands versus maybe a few years ago in the traditional product lines?
Cyrus Madon: Yes. So just on the revenue and margin percentages, the one thing to be mindful of is that with things like our input raw material costs such as lead, those flow through the top-line but have no impact in the actual cost line. And so ultimately, in a higher inflationary environment, you could see some margin deterioration just due to that math. But ultimately, and how we look at the business is EBITDA per unit. And so over the course of time, that has continued to improve. And we expect, given our ability to price the market, the growth of AGM batteries in the aftermarket and our continued operational improvements that that will continue expanding through the next five years as well.
Andrew Kuske: Okay, that’s great. I’ll look good at that. Thank you.
Operator: Thank you. Our next question comes from the line of Gary Ho with Desjardins Capital Markets.
