Grant Fitz: And just with that, Christian, that is a mitigating factor as well, too, on some of these end markets, we continue to have the headwinds that we’re experiencing. We have not yet incorporated any of these additional cost initiatives into our — into the guidance range that we have to a large extent yet. So we’re still identifying those initiatives and getting ready to work on the timing of that. So…
Christian Zyla: And then it looks like Signature had about $16 million in free cash flow last year. I know you don’t guide to free cash flow, but based on core Myers and the addition of Signature, is $80 million reasonable? Or is there something we should think about for free cash flow?
Grant Fitz: Let me just take a quick look here at a chart, Christian, just to make sure… I think that’s probably reasonable. Let me take a look at this as if you have some other questions, just to kind of calibrate to make sure I’m comfortable with that number. So…
Michael McGaugh: Yes. I mean, Christian, just on that point, as Grant looks up the specific number. We are seeing really solid results from Signature. There’s a lot of growth tailwind there. The infrastructure investment that’s being put in place through the various government spending plans over the next decade, Signatures is — will benefit, is benefiting and we’ll continue to benefit from those programs. We just — we continue to be very pleased with that acquisition. And as I said, look, our objective was to learn with some small ones get our processes in place. We know we’re not going to about 1,000. The Mohawk acquisition, as I said, it has been a bit of a challenge culturally. We’re working through that. We’re bringing those businesses together.
But a lot of the key learnings from the 3 or 4 prior acquisitions we did that were small and in the magnitude of $30 million, $25 million. They really allowed us to have excellent processes and to really improve our capability when we move into the intermediate size acquisitions like a Signature, where we spent $350 million. I think we’ve got a great company with a lot of growth, great margins. And quite frankly, I think we bought it at a very reasonable price.
Operator: We now turn to Anna Jolly with Gabelli.
Carolina Jolly: This is Carolina from Gabelli. So hopefully, this doesn’t repeat the prior question too much, but can you just talk a little bit about what surprised you in the material handling side of the business outside of the ag order more this quarter than expected and some of that in the discretionary items? And then also secondly, can you talk about what your — what you kind of learned from Mohawk and Trilogy Plastics that you’re applying to Signature?
Michael McGaugh: Yes, Carolina, good question. A large part of it was the shift of the agricultural seed box order — and another piece of it was in March, some of the gas can sales that we expected were more shifted to Q2. But the lion’s share of it was the ag seed order, and that’s why we stand by the guidance that’s just shifted to later in the year. On distribution, the sales came through weaker in March than we anticipated. And the key learnings there is the need to integrate swiftly and effectively and the need to integrate the cultures fast. The other thing — the other learning is, quite frankly, is what we said when — in the Q&A session at Investor Day, buying some fixer uppers or some lower performing businesses and trying to convert them to a higher performing run rate and doing it in a very short period of time, it is a lot of work.
And doing that with some smaller acquisitions, in particular, several of them concurrently, you have your hands full. I do believe we will bring the performance of Mohawk up to the level of Myers Tire Supply. Mohawk was running at about 1/2 the EBITDA margin percent as Myers Tire Supply. And our belief was we could bring it up to the level of Myers Tire and in fact, just the complexity and bringing in the distribution centers, the IT systems that work with that as well as the company cultures. We — we ultimately bought a complicated small business. And we knew we would learn what to do and what not to do and what the capabilities are of Myers. And that’s where our focus now is I’d much rather buy a quality company that has branded and differentiated products.
We are being much more careful about low barriers to entry businesses. And we bought some low barrier to entry businesses to give scale to our rotational molding as well as the distribution. Those are the right things to do. Those businesses need scale. But as we said at Investor Day, we now have a larger business in contract manufacturing and a larger business in industrial distribution. They’re fine businesses, but they’re not going to have the EBITDA profile that we seek — and that ultimately is more of the Buckhorn, Acro– Akro-Mil, Scepter and Signature model where your EBITDAs are 30% plus. And that’s why I say that’s the cornerstone of the company, and that’s where we’re taking the company. So hopefully, that addresses the question.
Grant, anything to add…
Grant Fitz: Yes. You may have mentioned, I apologize if you did. But I think the ERP piece is also just a technical piece of just making sure that we can get good visibility across our businesses with ERP consolidation. That’s going to continue to be something that provides an infrastructure for growth for us as well, too. And so it’s not just the Mohawk integration issue. It’s also within the business. It will help us clearly be [Indiscernible] to be more efficient and to run the business more effectively.
Michael McGaugh: Yes. That’s — Carolina, the low barrier-to-entry businesses as you would expect, have your lower margin profiles. And while they are easier for us to integrate and we can buy them for a lower price point, we’ve learned focusing on the differentiated branded businesses with a competitive moat is the right approach. And as a matter of fact, we were able to get all that with Signature still at an 8x multiple, which we feel really good about.
Operator: [Operator Instructions] We now turn to William Dezellem with Tieton Capital Management.
William Dezellem: I’d like to jump to the $7 million to $9 million of cost savings that you referenced here. Are those cost savings currently identified? Or is that a target? And do you have some general idea how you’re going to get there?
