Mark Kowlzan: We’ve got this momentum going right now that we started good five or six years ago. And quite frankly, as we’ve done on the mill side now, the opportunity to continue to capitalize on the box plant opportunity will continue infinitum for us. That’s part of our growth strategy. That’s how we’ll continue to provide value for our customer base. And so again, Tom, again just…
Tom Hassfurther: Well, I think I would add — I think it’s a good reminder always that our capital plants and the box plants are built around our customers. And our customers that we’re aligned with are in growth mode and that’s a big benefit to us. And we’ll continue to invest around those customers.
Mark Kowlzan: Again, I think I commented on the January call in the last five years since 2019, we’ve installed 69 new converting machines. We’ve replaced or completely upgraded 25 of our corrugators. We built four new plants, Marshfield, Richland, Landisville and Salt Lake City specialty. In Salt Lake City, we just started up in the last month, so that’s our newest one. And so we continue to do this as Tom mentioned, it’s all done to grow with the customer and take care of what the customer needs are. But we have this capability and it’s — again, we’ll continue to capitalize on the strength.
Nicco Piccini: Understood. Thank you very much for the commentary.
Mark Kowlzan: Next question, please.
Operator: Our next question comes from Mark Weintraub from Seaport Research Partners. Please go ahead with your question.
Mark Weintraub: Thank you. First, are you now done with the Jackson project conversion? Is that now fully set?
Mark Kowlzan: Yes, everything that we had sculped out four years ago is complete, and that project has turned out, as you can imagine, we’re more pleased than we thought we were going to be at this time. The original phase of work that we just completed was originally a 58-day schedule. We completed that two weeks ahead of time, started up the day before Easter, and have been running extremely well ever since. And as I’ve talked over the last year, I expected that machine to be producing over 2,000 tons a day and we’ve been doing that for the last week or two. And so, getting that mill stretched out now, and getting everybody used to running at these high production rates, but the good news is we need every ton that we can produce. And this is all high-performance grade lightweight linerboard coming off that machine. And so it’s doing everything that we expected it to do and more.
Mark Weintraub: Congrats on that. So now with Jackson up and running for — I think in the second quarter, you produced a little under 1.2 million tons. Maybe on an annualized basis, what would your full production potential be assuming the demand is there for you to run for?
Mark Kowlzan: If you include the seven mill system, would be a little bit over 5 million tons. If you round off 5 million tons system, a little over 5 million tons, 5.2 million or so.
Mark Weintraub: Okay.
Mark Kowlzan: Depending on the grade mix that you’re running as far as lightweights basis weight, 5 million, 5.2 million is a good number going forward on a run rate basis.
Mark Weintraub: Excellent. And then lastly, just want to come back to the up 8% on at least in April, et cetera. If I look at where your first-quarter daily shipments were relative to your second-quarter ’23 daily shipments, they were up about 8% as well. And I realize we’re talking about different time periods when you’re referencing April specifically. But so the question is, I mean, are you still seeing momentum of demand getting stronger in the current environment? Or is it more that you had this uptick, you gained business and it’s sort of stable at those higher levels?
Mark Kowlzan: Mark, it’s still going up, it’s going up at a lesser rate, but still we’re going up and — but second quarter is always an interesting one for us versus the third and fourth, which are more predictable because we have — we take — seasonality is kind of a little more iffy in the second quarter. But we still see that momentum going up and then we expect it to continue to go up again in the third and fourth quarters of the year.
Mark Weintraub: Okay. And then one last quick one. So I — and if I read it right, your cap spend was pretty low, I think like $72 million or something in the first quarter. What are you expecting full-year on CapEx and maybe depending on the number, if it’s — I thought you were going to be spending a fairly sizable amount still this year. And maybe help us with Jackson now done, what these new monies are going to be spent on?
Mark Kowlzan: Yeah, Mark, that was a timing issue as far as just how the invoicing is done against the projects. We called out that somewhere in that higher 400 level, and we’ll give you some updates in July. We always reserve the right as an example, if new opportunities come along, we move forward with these opportunities. And so right now, we’re in that high $400 million area. But again, we’ll give you some update. If there’s any — if there is any change, we’ll update you in July.
Mark Weintraub: Thank you. I’ll get back in queue.
Operator: And our next question comes from Gabe Hajde from Wells Fargo. Please go ahead with your question.
Gabe Hajde: Mark, Bob, Tom, good morning.
Mark Kowlzan: Good morning.
Gabe Hajde: Thank you for all the detail. I wanted to ask and I guess revisit the price question, which I know is a little tricky sometimes. But going back to the Q4 call, you had made some comments, Mark, that you were going to try to — these are my words, kind of decouple from RISI indices to the extent you’re able to. And then now we’re reading on a sequential basis that we got the $40 a ton posted in February, we had expected $70. And so it feels like a headwind relative to what you were expecting or maybe we all were expecting going back to the kind of the price-cost squeeze that we all mismodeled in the first quarter. So I’m curious if that is proving more challenging. And I’m just asking in the context of this is kind of blazing new trails relative to what we’re used to when analyzing this industry.
