Of course, we are improving our management of the breeder side, and I think that has improved the hatchability, especially for us. We are better than the average company right now, but there is still some challenges on the hatchability that maybe with a new breed will be resumed. The prior level that we used to have on the AD is 82%, but I think it’s still a management issue on the weight of the male, especially of the male, and an overall hatchability of this new breed. So, as we go throughout the years, we expect to get that better. As the number of – or the volume that we expect for the incoming months or the next years and the expectations and a little bit of the bottleneck that that poses, I think that’s why the industry is trying to increase the number of breeders.
As we see the pool placements, it was a little bit higher than year-over-year, but that’s the reaction of the industry, expecting to improve hatchability through age. Another issue that we have, we have a little bit of an older breeder age, which is impacting hatchability once again. And the increase in the breeding flock is going to counter that with a younger flock, which should be more productive.
Andrew Strelzik: Okay. And if I could just squeeze one quick one in here. On the balance sheet and the cash balance, you talked about the strength of the balance sheet. The CapEx is coming in maybe a little higher than we had otherwise thought, but your cash balance is pretty robust. Your projects generally speaking are kind of winding down. How are you thinking about leveraging that cash balance? You talked about some optionality for growth, but I guess when you think about the opportunity set, what’s attractive and how are you thinking about allocating the cash? Thanks
Matt Galvanoni: Andrew, it’s Matt. Thanks for the question. I think our main focus really, I mentioned it a couple times in my prepared remarks, is really on organic growth, and that growth with key customers. We’ve had some projects that we’ve been either executed or in the process of executing, which is providing us further production and kind of tightness with our key customers. And I think that’s where we’re going to probably see more of our cash from a CapEx. And that’s why when I gave that range, it really – I did put a little bit of a caveat on that this could change with other broader, bigger organic growth opportunities that we have for that cash at this time. So, that’s something we’ve been executing on very well over the last year to 18 months. And I think we’re going to be seeing more of that as we go forward. I don’t know if Fabio wants to add any other color to that.
Fabio Sandri: No, and again, Andrew, we’re always looking to how can we create value for the shareholders. We have a lot of growth initiatives. One, I think to Matt’s point, is to grow with our key customers, but we have our targets in terms of acquisition. We will do an acquisition when we think it’s accretive to us and will help us either on improving our portfolio in regions or in brands or in growing our Prepared Foods offerings.
Andrew Strelzik: Great. Thank you very much. I’ll pass it on.
Operator: Our next question comes from Peter Galbo from Bank of America. Please proceed with your question.
Peter Galbo: Hey, good morning guys. Just a couple of P&L questions for me. Matt, and Fabio, you talked about obviously the deflation we’ve seen in in feed costs or in US feed costs. Matt, I was just hoping maybe you could give us an update on the other part of the cost equation, so labor and conversion, just kind of what you’re expecting for 2024, and then maybe a blended either COGS inflation or deflation rate for the US.
Matt Galvanoni: Yes, I think at least directionally, Peter, I think relative to labor, as Fabio mentioned in his prepared remarks, we’re getting to the point of being fully staffed, which is great. So, that does of course come – and then when you think about on a per person basis, our increases in 2024 will not be as high as they were, shall we say, in 2022 and early part of 2023. Just the market is kind of becoming a little more stable relative to that. So, we will see some levels of increase, but not to what we’ve seen in the past. But I think that the main driver that we’re seeing from a cost perspective, that’s a huge chunk of our COGS, is the grain, which we are seeing the tailwinds, which is excellent. But when I think about the other key cost drivers, labor should be relatively in check and ingredients and other things of that nature, nothing that is causing any level of extraordinary change.
Fabio Sandri: And Peter, I think as we do every year, we started the year looking at all the efficiencies that we can capture. We call this the opening the gaps, looking at all the opportunities in every single operation throughout our network, and then we created action plans to close those gaps, or capture that operational excellence, as I mentioned. Every year, we expected from $100 million to $200 million in operational excellence, in operational effectiveness. And that is part COGS, part revenues, because we talk about improving the mix. We talk about reducing overall plant costs, and we talk about capturing improvements in yields. Of course, as Matt said, that is grain non-impactful, but there is a little bit of inflation in terms of packaging ingredients and somewhat utilities that we can counter.
