Christian Koch : Yes, we could — that’s an extended discussion because the building envelope space stretches from windows, doors, garage doors, I mean you’ve got shingles, you’ve got nails. We could get into all sorts of stuff. But I think for us, if you think about our core and what we do well, it would — it’s really going to be around that core building envelope, other roofing ideas, things down the wall, getting into the wall. But again, that — an idea that I think when we look at things, it’s going to be either — it’s going to have synergies either in channel. So is it something that helps us with the channel. And obviously, my comments on the retail piece and the big box stores in that. And having said that Frank has opened up a new channel for us there.
There’s some interesting opportunities there. We look at new products, and there are some things in roofing and there are some things in wall cladding and things like that, that we think we have certain processes and raw materials that could be added to that like insulated metal building panels or one that obviously — we do metal and we do polyiso and those kind of things. So that could be one that we would look at. But I think you’re going to find that there’s enough for us with channel and with core synergies there too, in products too. keep it pretty close to what we’re doing now. We think there’s enough that — it’s not going to be too far afield. I don’t see us getting into nails, for example, or getting into some piece of equipment related to cranes or something like that, right?
So it will be a more CCM, CWT looking acquisition, adhesive, sealants, as I said, roofing materials, metal, things like that.
David MacGregor : Where are acquisition multiples right now, Chris?
Christian Koch : They’re moving, I think. This is one of the interesting things. I think we all knew they were pretty high for the last couple of years, and I think they’re moving down, I think, for types of businesses we look at. probably in the 8% to 10% range, maybe 9% to 11%, something like that, depending. But I think there’s also value to be had a little bit lower as people get more realistic about the surge that came with COVID and what’s happening in the market. I also think, seeing things in the private equity markets around wanting to seeing extended monetization events, the time keeps extending. And so we think there may be some opportunities to generate some lower multiple and opportunities for exit by looking in that space.
Operator: And your next question comes from the line of Adam Baumgarten from Zelman.
Adam Baumgarten : If we think about where you stand today and assuming stable price, stable costs, on the input side, how would that look in terms of the impact of next year at this point?
Christian Koch : I guess — sorry, you’re breaking up there. I think you said if we look at stable prices, stable costs, how does it look for next year. Again, we don’t want to get too far into what next year looks like right now given what’s happening in the markets. But again, our view on pricing is been that this year was a pretty tumultuous year as well, and pricing was relatively stable, and raws were relatively stable. In fact, we’re kind of beneficial. But again, I think we’re going to have to wait and see what happens in the markets. But our view into the fourth quarter, as Kevin dictated or indicated is good, another stable quarter. Q1, we think, Q1 of last year wasn’t the best quarter. I think we were down in the high 500s in terms of revenue on that.
So this year, if our exit point is maybe somewhere in the 650, 660, 670 range for fourth quarter then. We think that brings more stability into the year could get off to a good start. And then we I think if we can keep interest rates at a reasonable level, and we can get some confidence back in the economy and stability, I think it could be a good year.
Adam Baumgarten : Okay. And then I guess if we think about demand into the fourth quarter, given your implied guidance, and if we strip out the destocking in 3Q, it seems like 4Q is maybe a little bit lighter than usual. If you could just kind of walk through the moving pieces there, if there’s still some other kind of one-off type like factors in that guidance?
Kevin Zdimal : Yes, really no one-off things. It’s just more of the things we talked about with some of the project delays would be the biggest piece, and that’s all around the interest rates and market uncertainty that for economic uncertainty that people try to delay some of those jobs.
Operator: Thank you. Mr. Koch, there are no further questions at this time. Please proceed.
Christian Koch : Okay. I want to thank everyone for joining us on the call. And we look forward to, first of all, launching our Vision 2030 in December and sharing all those details with you. And we’ll be in touch on that. And then following up with our fourth quarter call as we end the fourth quarter and move into 2024. So thanks very much, and look forward to talking to all of you very soon.
Operator: Thank you. Ladies and gentlemen, that does conclude our conference for today. Thank you all for participating. You may all disconnect.
