Steve Nicola: Yes, the two things to mention just to highlight with respect to the industrial margins are, one, it’s the revenue decline, particularly on the warehouse side. And again, it’s – when we look at the engineering business, revenue was higher, but the stage of the phases of the work that we’re working on now versus where we were comparable to a year ago. Last year was more the higher-margin design-related work, engineering design-related work. So, those are the two major elements to the margin impact.
Daniel Moore: Okay. Helpful. And I appreciate the update on the debt. Just if you were to go-to-market today, any sense for what terms could look like on the refinancing bonds or wait and see given you have at least a reasonable amount of time between now and year-end?
Steve Nicola: Yes, actually, we’re working through that now and just starting to get and understand some of those market indications.
Daniel Moore: All right, thank you again.
Operator: Our next question is a follow-up question from Justin Bergner with Gabelli. Please proceed with your question.
Justin Bergner: Thanks. Two quick follow-ups here. You mentioned that as you deliver more equipment on the energy storage side that will release working capital. Is there any way for you to frame sort of how much working capital is tied up and can be sort of released in that business?
Joe Bartolacci: I am looking at Steve. Steve, might give you a perspective on it. I would tell you that it is a significant amount of working capital, but closer to $80 million to $90 million, I would say, Steve?
Steve Nicola: Yes, Justin, I’d say the – when we release our 10-Q today, you’ll see our balance sheet, but the areas, the biggest area where you noticed the working capital and the opportunity is going to be in an area called, the line item called, contract assets, contract liabilities because those are the line items of working capital that really reflect the work that we’ve done based on not necessarily what we’ve built because that would sit in accounts receivable. But the work that we’ve done and the difference between the revenue recognized versus when we’ve reached the milestones for billing purposes.
Justin Bergner: Got you. Okay. So it would be a contract asset reliability in this case?
Steve Nicola: Would actually be. It could be both depending on where we sit with milestone payments on a particular aspect of a project.
Justin Bergner: Okay, got you.
Steve Nicola: So you should see both line items.
Justin Bergner: Got you. And then the other quick question was the auto engineering business, which I assume, relates to the acquisitions from a couple of years ago. I realize that’s more to support your energy storage business or at least the acquisitions were. But is that business now profitable on an EBITDA basis, or does it still have a little ways to go?
Joe Bartolacci: So, there is a couple of things that are happening in that business. We are incrementally better than prior year, modestly profitable at this point. But we are looking at a substantial change in that organization, starting hopefully here in the latter part of this fiscal year as we’ve been in negotiations with the unions over there for quite a while, trying to get an adjustment both in terms of compensation as well as headcount. That’s fairly significant. So we hope to talk a little bit more about that, Justin, a little later in the fiscal year once we get confirmation.
Justin Bergner: Great, thanks.
Joe Bartolacci: Sure.
Operator: Thank you. Mr. Wilson, we have no further questions at this time. I would like to turn the floor back over to you for closing comments.
Bill Wilson: Okay. Thank you, Christine. And again, thank you for joining us today and your interest in Matthews. For additional information about the company and our financial results, please contact me or visit our website. Enjoy the rest of your day.
Operator: Ladies and gentlemen, this does conclude today’s teleconference. You may disconnect your lines at this time. Thank you for your participation. And have a wonderful day.
