Benjamin Theurer: Okay. Perfect. That makes sense. And then my second question is really just around capital allocation. You’ve upgraded your cash from operations guidance for the year, just marginally higher on CapEx, I think, just about $10 million versus the prior guidance. So there’s clearly more excess cash created and you’ve alluded to opportunistic share buybacks, increased dividend. But just — how you feel about the asset base you currently have? How much do you think go forward you still need to invest into just CapEx operations, to have plants up in running, maintenance? And how much is left for buybacks? Because it seems like you’ve guided down for shares outstanding. So there’s something in those numbers. Just wanted to understand like how do you think about the buyback opportunity here.
Jim Gray: Yes. Well, we look at, obviously, the strategic cash that we have for deployment. So that’s cash from operations less our CapEx and less our dividends. And in this — in Q3, we did deploy $101 million towards share repurchases. So again, I thought that the stock was trading at a nice value and wanted to make sure that we’re putting dollars back towards shareholders. And we’ll continue to look at that as an opportunity. I think as we look forward on our organic growth capital, we have — obviously, we’ve had some volume slowdown, so that gives us a little bit more headroom capacity that allows us to push out some of our growth CapEx into later years. But we’re really seeing some investments in some of our healthful solutions platforms that are still where we’re anticipating.
For example, we’re completing an expansion at our PureCircle facility in Kuala Lumpur, which is just coming online. And so that really helps us with our bioconverted Stevia solutions, which are absolutely in demand as we look around the world and concerns from governments around obesity, diabetes and really pushing trends towards sugar reduction. So we’ll be opportunistic towards organic capital, but there’s just an excess of demand in terms of opportunities right now that we see globally versus really the dollars that we allocate out of our capital allocation.
Benjamin Theurer: Okay, perfect. Thanks Jim.
Operator: Thank you. One moment please. Our next question comes from the line of Ben Bienvenu of Stephens. Your line is open.
Ben Bienvenu: Hey thanks, good morning guys. I want to ask about the 4Q guidance and in particular, kind of the implied operating profit for North America, which I recognize there is inherent seasonality in the business from 3Q to 4Q. But I would think with core base is coming down, still strong pricing, volume getting better sequentially, that we might see operating profit better than flat to slightly up in the fourth quarter? So help me think about the range of outcomes that are possible there, what the variables are affecting it and why you centered in on that guidance that you did?
Jim Gray: Yes. Thanks, Ben. I’ll take this one. I think this has been a year where we’ve seen some sales volumes impacts and kind of just slower play through and the demand signals that have really kind of led to what I would call kind of a nice normalization of our texture sales, particularly in North America. And we’re seeing — as we go into Q4, it’s always — it’s a softer quarter in terms of volume demand for sweeteners. And so I think what we’re just doing is we’re being, I would say, mid center cut to maybe conservative on volume expectations, which really kind of probably guides our Q4. And as I mentioned before, when you have corn values decreasing from 1 contract in year to the next, so higher corn values in 2023, an expectation that corn is going to be less expensive in 2024.
And generally, we have a conversation with customers about the value of that corn and as it impacts their pricing. And so you might have an expectation from customers that pricing might be flat to down in 2024, it might cause them to pause on those last couple of weeks of ordering in December. You get that ordering back in January or February, but it’s something that I have to be thoughtful about as we close out the year. And then I’d just remind everybody listening that if you’re a CFO and you’re looking at your working capital change, year-over-year, and you’re trying to manage operating cash flow, decrease in inventories is probably your most significant lever that you can use nowadays with short-term rates so high. And so if I’m being center cut to cautious on that, I just — I’m trying to anticipate what a December surprise might be.
Ben Bienvenu: Okay. Very good. Understood. My second question is around currency and in South America, in particular, is your expectation that you could continue to price for any currency headwinds that you incur as we move forward? And would that be true across the other regions that you’re operating as well? How do you expect to be able to navigate that?
Jim Gray: Yes. Generally, we do because the underlying conversation is in what’s the value of the corn. And in some markets, if the value of the corn is really valued on an equivalent to U.S. dollars, then that’s absolutely part of the day-to-day conversation with customers on pricing. I think what will be interesting is that you would say, well, when and if the real is strengthening, then wouldn’t the value of the corn be less? It just rises more in Brazil due to exports. So it does — it is a very efficient market in Brazil, in particular. But yes, we believe very much that we have the muscles to pass through changes in FX over time.
James Zallie: Yes. And we’ve demonstrated that over the last number of years. And specifically, our Pricing Centers of Excellence originated in South America and developed those muscles, and that’s been carried out around the world. So I think we feel pretty comfortable and confident that the team is very experienced in knowing how to do that.
Ben Bienvenu: Great. Congratulations, best of luck.
James Zallie: Thank you. Thanks Ben.
Operator: Thank you. One moment please for our next question. Our next question comes from the line of Josh Spector of UBS. Your line is open.
Unidentified Analyst: Hi, good morning. This is Lucas [Ph] filling on for Josh. So just sort of want to get back to the volume. So I mean, you’ve given quite a bit of context there on sort of how it’s improving sequentially through the third quarter into the fourth quarter. So just wondering if you could give us your updated view on where you sort of see the gap currently between customer purchases and the sales volume trends? So what is the difference sort of now between kind of the seller and the sellout? And do you expect that to reconnect in the fourth quarter? Or is that maybe in the first quarter? Thanks.
Jim Gray: Lucas, maybe I can ask you just to expand on your question a little bit in terms of — I think there’s some implied timing of what you’re looking at for like customers here like branded company customer volumes versus our ingredient sales. Is that your question?
Unidentified Analyst: Exactly. So where your sales are going downstream. So I mean, obviously, with the destocking, there’s been a gap there over the last sort of nine months or so. And presumably, that’s narrowing as we sort of get towards the end. Do you have any visibility into sort of where that gap is and how you see it closing other than just that your volumes are improving sequentially?
Jim Gray: Yes. Maybe I’ll comment, and I think maybe Jim can add here as well. We look at our business and then we have — a large part of our ingredients goes into food and beverage, usually into packaged — packaged food companies. And within that, you have both branded as well as private label. So private label is really kind of co-packers and co-man. So we’ve seen some volume kind of uptick there. I’d say really, where we’re catching up is in more of the branded — branded CPG companies. We also have about — like in the United States and Canada, for example, about 20% to 25% of our volume goes towards foodservice, so restaurants, etcetera. And there, we’ve seen generally probably much more kind of ups and downs in 2020 and recovery in 2021.
