I think what we’re looking at now is a little bit more of a backend loaded, 2024 as a consequence of people really taking the time to make those launches successful. I think the urgency around customers has increased to make sure they’re successful, to make sure that we don’t have slips as we launch the products, make sure there’s no quality fallout, to make sure supply chains are in the right places in order to meet their needs, making sure our facilities are there, making sure the people are there, and so forth. And so, that’s the activity that we’re really looking at. Obviously, in this uncertain environment around the macro and the geopolitical and the interest rates, it was easy for a lot of customers to take a pause for the remainder of the year, but that is not an indication of them taking a pause in their innovation.
Their innovation is clearly accelerating and they want to make sure it’s done right. And so we’re expecting the ramp up in the second half of the year.
Brian Drab: Got it. Okay. And that’s what I thought you were saying, that maybe it’s a little more back-end loaded and this is all related to — You know, you’d been talking about the 50 million in incremental revenue opportunity. I guess that’s part of what you’re talking about. It sounds like this is even broader kind of you know, second half of ’24, like some other stuff moving in from the first half to the second half as well.
Matthijs Glastra: Yes, that’s correct. And some additional stuff too, right? So, we are basically, yes we call that Brian, our new product Super Cycle because there’s a lot of different products and application launches coming together later in 2024 and 2025. So, you know, the message is, listen, we got a short-term macro that is a bit more of a temporary headwind, but we’re staying just razor-focused on these new product launches with our customers that really drive our long-term growth. So that’s the upshot.
Brian Drab: Got it. And looking at the gross margin and you’re really having a good year in terms of gross margin this year, how much can you tell us about 2024 in terms of gross margin? Because you have this project that’s this transition of the consumables manufacturing that should get you a healthy margin boost next year, I think. And can you talk about the timing of that? And you know, is it going to be tough to get 100 bps of gross margin in ’24 after such a solid step up in ’23?
Matthijs Glastra: I don’t think so. I think we’ll be able to still expand gross margins, another 100 basis points. You know, I think obviously, you know, there’ll be a little choppiness in the quarters as a consequence of new products being launched and the mix ratios associated with that. You know, you rightfully point out the consumables are a lower gross margin than the rest of the business. However, there are other parts of the business. A lot of our new product innovation is being launched at a 50% or greater gross margin. And so, that mix effect will be choppy throughout the year, but overall for the full year, we should be able to expand the gross margin to 100 basis points, all else being equal. Now obviously, if we do an acquisition that can change things, but you know, for the most part, the base businesses, their performance, particularly as they have been really embracing and institutionalizing the NGS process, I think that gives us the confidence that they can continue to deliver these results.
Robert Buckley: Yes, in addition, I think Brian, what we said in the prepared remarks is that we’ll also continue to apply 80-20 portfolio management tools, which is basically rationalizing our portfolio, focusing for gross margin and profitability as well as creating the capacity for the growth, right. So that we basically phase out lower margin, less productive products that are you know, either commoditized or more end of life. So that’s another aspect that is an ongoing process within the company that we’re looking specifically in 2024 to execute on.
Brian Drab: Okay, are we seeing the benefit from that consumables transition already or is that something that is really just going to be felt in the first half of ’24?
