So that helped us out a lot as the private label was particularly aggressive. But we also have further relationships developing on the brands given our vertical integration. So we’re really happy with the way the pet care is going. There is also some pricing leverage that we still see in that area. Then you had asked about destocking. I would say the destocking was more on the consumer specialty side of things, in particular in the health and beauty solutions. And as we’re looking at the order books now, as we go into the first quarter, we are comfortable that that destocking looks like it’s behind us. We got some strong order books. So outlook is very positive for that product line.
Michael Harrison: And then maybe, since I have you, D.J., maybe just to ask kind of a similar question on the paper, PCC business. Get a sense that maybe in North America, in particular, those customer operating rates weren’t where you would like them to be for 2023. Just curious if you feel like destocking and lower operating rates were something you were still dealing with in the fourth quarter and maybe how those are trending thus far in January and I guess early February?
D.J. Monagle: Yeah, so a couple of perspectives on that. So, if we look at Europe, Europe still lagging a little bit down in that 70% operating rates. We’ve been fortunate in that our customers have been less affected by that decline. But Europe is still sluggish. North America in the low 80s starting to climb up. We look at inventory levels and those have come down. So we are projecting that North America volumes will be better this year. And we’re starting to see some of that come back, but not at the rate we’re hoping for, but it’s certainly better than last year. That’s how that looks. And then, of course, Asia were less dependent on the operating rates. Asia is a penetration story and that continues to go very favourably.
Michael Harrison: All right. And then, I guess, maybe just over on the metal casting side of the business, we talked about Q1 maybe being kind of a slower seasonal period in Asia, but I’m just curious if maybe you can talk in a little more detail about the pace of recovery in China. I think everybody maybe around this time last year was hoping that we were going to see a more robust rate of recovery hasn’t really materialized that way. Are you seeing signs that some of the government stimulus and other actions that are in place in China are starting to drive some market improvement there?
Douglas Dietrich: Yeah. Thanks, Michael. I’m going to pass it over to Brett Argirakis as well. But let me start by saying, look, last year, we saw, referring to the metal casting business, continued growth quarter after quarter after quarter and we’re still seeing that kind of trend. So for us right now going into 2024, it looks like a really solid year for us both on, as D.J. just mentioned, some new satellites ramping up, new contracts in paper, but also in metal casting. Let me give it over to Brett to give you some color there.
Brett Argirakis: Hi, Dan. Thanks for the question. Look, China — as Doug said, China — it was a — the market continued with a slow, but continuous recovery last year. The green sand bond volume improved about 7% versus prior year. But we still have plenty of room to go to get to those peak levels that we saw in 2021. The fourth quarter volumes increased about 26% over the same period in ’23. But again, that was a low point, but you could see the recovery is continuous. You mentioned the government stimulus programs. There have been several stimulus programs to boost the economy and we are seeing some impact from them. During the investor day presentation, we talked about the — going into the blended products more so into the — some of these mature markets. We have it in the mature markets. We’re moving them into other markets. So, we continue that initiative. So all in all, we see 2024 with about similar growth of around 6% to 8% this year.
Michael Harrison: And sorry, is that a comment on China specifically or for the metal casting business overall?
Brett Argirakis: No, that’s China specific.
Michael Harrison: Got it. Okay. And then last question for me is one maybe more for Erik. Just curious for your thoughts on interest expense for both Q1 and the full year. And maybe just remind us how much of your debt is at fixed rate versus exposed to some variable rate.
Erik Aldag: Sure, Mike, thanks. So roughly 50% of our debt right now is variable. Average interest rate right now is around 6.15%. So the fixed rate is at 5%. Those are the notes, and the floating is around 6.9%. So if and when interest rates come down, we’ll see some benefit on that floating piece of the debt. I think shorter term, Q4 to Q1, since we were able to pay down some debt in the fourth quarter, probably going to see about $500,000 of lower interest expense just sequentially Q4 to Q1. So hopefully that helps.
Michael Harrison: Very helpful. Thanks, everyone.
Douglas Dietrich: Thanks, Mike.
Operator: Our next question is coming from David Silver with CL King. Your line is open.
David Silver: Yeah. Hi, good morning. Thank you. So I do have a number of questions and I’m going to demonstrate my lack of organization here, but I’ll probably go back and forth a bit. First question would be on price and volume trends. But just looking at the fourth quarter ex-BMI, you were plus 6%, right? I know you had pricing initiatives in place through the year. I know you have — you highlighted a number of new product introductions. How would that 6% in general from your perspective break down? I mean, how much was price, how much was volume increased? I don’t know if you look at it at the company wide level, but any kind of breakdown there would be helpful. And I apologize if I missed it. I don’t think I saw it in the slides.
Erik Aldag: Yeah. Thanks, Dave. So as we moved through 2023, pricing became less of a year over year impact. So as we got to the fourth quarter, pricing is in the low single digits in terms of year over year revenue change. So a lot of that 6% is coming from volume and mix improvement.
David Silver: Got it.
Erik Aldag: And I’ll just add, Dave. And that’s going to be the case going forward. I would say that our growth in 2024 is going to be much less price driven than it has been the last two years. We see good volume growth. As Doug’s been talking about, Household & Personal Care staying strong, pockets of a few markets recovering from where they were in 2023. So the growth going forward, we expect to be much more volume driven.
David Silver: Thank you for that. And let me just follow up. But I guess 12 months ago, Erik, you had indicated with your pricing initiatives that it would — they would take effect kind of a little bit on a lagging basis. I just wanted to clarify, but for the fourth quarter, would you say the price cost has fully offset or you’re slightly better than covering all your costs? And then maybe from your view, from the — your customers positioning, what is the nature of kind of the request for some give backs? In other words, it’s a mixed cost outlook, right? Labor is up, but at least in a number of areas, goods prices are softer. What’s your view or what’s baked into your expectations for next year regarding maintaining the price improvements that you’ve achieved across 2023? And if you could, your expectations for that price cost balance?
