Brett Johnston: This is Brett. I’ll take that question. So I think the first thing we’d like to talk about just related to the Q4 revenues, there was no lost customers there. So base core customers, very solid. Again, most of it was related, if you take the commodity value decreases and the seasonality, you’d get mostly there if you want to split that in half, that’s fine. But that will get you most of the way there.
Gerard Sweeney: Got you. And I apologize if I said lost customers, I didn’t mean that, I meant seasonality.
Brett Johnston: No, no, I was just reaffirming, I think it’s important.
Gerard Sweeney: Sorry, there was noise in my background. But got it. Perfect. So fair to say 50-50 part commodity, part seasonality?
Brett Johnston: Yes.
Gerard Sweeney: Got it. Got it. Okay. And then on the RWS side, that $1.5 million that you sort of broke out maybe impacted gross margin. Was that spread out across the course of the year? Or did that sort of become more second half loaded or even loaded in the fourth quarter? Because we saw some pricing pressures, inflation or lack of pass-through, it maybe became more cumulative later in the year. How do we look at that?
Brett Johnston: No, you’re thinking about it right. I definitely think of that as more back half of the year related.
Gerard Sweeney: Got it. So I mean you sort of gave I don’t want to say guidance, but January, February this year, you’re running at, I think, $4.25 million gross profit. That equates to $12.75 million gross profit. So things are bouncing back. But also on that front, is February better than January? Or were they sort of even on that metric?
Brett Johnston: I’d say mostly even. February certainly has fewer business days. So there’s different factors that go into those. But yes, I’d take it as an average.
Ray Hatch: Gerard, this is Ray. I agree with Brett. And I think I just want to reiterate — it’s not the right word, but to clarify. We did put January and February out there, at least some key numbers around that. And yes, we started implementing sadly just in January, but we started fixing this thing. We got it fixed in January, but there’s a cycle through. So our expectation is that as the months go by, we’ll get more and more benefit from that. That’s what we were trying to kind of verbally put in there.
Gerard Sweeney: Okay. I got you. I mean I was kind of looking at it, there’s probably some seasonality in fourth quarter that, exiting January and February, looked good. And then when you say cycle through, I imagine there’s price increases, it takes a little bit of time to get through the system.
Ray Hatch: Yes, just the billing cycle itself has a bit of a lag effect. So I guess what I’m trying to illustrate is that that’s the beginning. We expect continued improvement.
Gerard Sweeney: Got it. Perfect. And then one final question, I’ll jump in line. Just cash flow from operations, obviously, a big increase year-over-year. When does that sort of get digested, maybe working capital decreased a little bit, cash flow accelerates? How do we think about that?
Brett Johnston: Yes. Overall, we’re very positive on operating cash flow going into 2023. There’s some momentum. But of course, we also expect growth. So the timing of that growth, where it falls out in the year, that could temp things down a bit from that, but we’re certainly optimistic.
Gerard Sweeney: Got it. We’ll take growth and then cash flow. Okay. Perfect. Got it. All right. I’ll jump back in line.
Operator: The next question comes from Chip Moore from EF Hutton.
Chip Moore: I wanted to follow up on that last one on the actions underway at RWS, sort of that billing lag. Do you think you’d get through that fully in Q2? Is that the right way to think about that?
Ray Hatch: Yes, I think it is, Chip. That cycle would have run out during the second quarter.
