So managing that inventory and getting that down is, again, another key focus. So we see a path to get that $149 million of inventory back to the low-130s by the end of the year.
Matthew Koranda: Okay. That’s helpful. And then just lastly, just on the balance sheet. What are the other levers we have to reduce leverage? I mean, it seems like we’re going to be cash flowing with inventory reduction and even with the lower guide. There should be cash flow in the back half of the year here. Are there any portfolio actions you’d consider in terms of monetizing any particular segment to pay down debt, kind of free yourself up from some of the leverage that’s happening right now?
Michael Yates: We’ve been — good question. We’ve been focused on leverage and managing inventory. Obviously, we’re 2.7 times levered on our — on a net debt basis, as I mentioned in the prepared remarks, we’ve been focused on that. Obviously, if we can achieve these $15 million improvement in inventory here between now and the end of the year, that will put us in a position where we can pay off the revolver. The revolver has about $12 million, $11.5 million outstanding right now. We’ll pay that off. And then we have a couple of other payments on the term note as well. So there’s about $18 million of debt that we could repay between now and the end of the year. The intention is to pay that off as we delever the balance sheet.
I think we’ve been planning pretty significantly from a demand planning and syncing up our demand plans and our inventories. That’s been a focus over the last couple of quarters to make — which had to happen in order to achieve what I’m trying to do by — what we’re all trying to do by the end of the year. So if we, in fact, do that, I could see us — the goal is to be — just have the term loan outstanding at the end of the year, which is about $110 million of debt. And on a trailing 12 month EBITDA at the midpoint, $46 million of EBITDA, you’re still — we’re still right in that range — middle of the range, 2.4 times levered. So, I don’t think we’re not in a panic position where we need to sell a segment. But in the same breath, I’m sure if the right price — and that’s the Board’s responsibilities to assess any type of strategic alternatives like that.
But right now, that’s — we’re just focused on right-sizing inventory, generating cash and paying down debt and getting in a good strong, better position from a balance sheet perspective to start next year.
Matthew Koranda: Okay. Got it. Enough portfolio actions in the near term it sounds like.
Michael Yates: Yes.
Matthew Koranda: Okay. Thanks guys. I’ll take the rest offline.
Operator: At this time, this concludes our question-and-answer session. I would now like to turn the call back over to Mr. Kuehne for closing remarks.
Aaron Kuehne: Thank you very much, everyone, for joining the call. We look forward to connecting with you as part of our Q3 earnings call in process.
Operator: Ladies and gentlemen, this does conclude today’s teleconference. You may now disconnect your lines. Thank you for your participation.
