Operator: Our next question is from Jerry Revich with Goldman Sachs, please proceed.
Rod Rushing: Hi, Jerry.
Operator: Jerry, check and see if your line is muted.
Jerry Revich: Yes, I apologize, this far into the earnings season, I should know where the mute button is, sorry about that. Good morning and happy almost holidays, everyone. I’m wondering if you just talk about €˜23 EBITDA guidance, nice to see the growth versus ’22, can we just talk about it at the segment level, how much of that growth is anticipated in RV versus the sequential improvement in Fire and Emergency and Commercial that you spoke to earlier on the call, can we just talk about by segment the growth drivers €˜23 versus €˜22?
Mark Skonieczny: Yes, so I think from an overall segment perspective, we’d be looking at — as we talked about the throughput in our F&E side, getting into that — coming off from where we ended up, relatively flat $2 million to $2.5 million to more into the $30 million and $35 million range for next year. And then, Commercial being in the $20 million and $30 million range, more of a normalized between $21 million and $22 million range, and then some downward pressure in Recreation related to the mix that we talked about, right, that having more in the towables and as you know, we’ve extended our reach into the East, so we’ll be selling more towables in the East through some of the backlog, so with the mix, we will have a downward pressure on Recreation, but would be more in that $95 million to $100 million sort of range for Recreation — for those three segments to get to where the full year number is and with some choppiness as we talked about in Q1 and Q2 across those segments.
Jerry Revich: Super. And then, can we just talk about Recreation, I mean, you folks have done an outstanding job of expanding margins in that line of business. Obviously, we’re going to give a little bit backward mix as you alluded to, but how do you think about the full cycle range of margins for the business as it stands today, what would you view as trough and peak, as you run a range of scenarios of what volumes might look like given all the improvements you’ve made in RV?
Rod Rushing: Yes, with the mixture, we’re still confident that we’re in that 10% range, so we’ve always said, Class A can dip in the low single digits since there was a real trough, but ultimately with the mix we have with the Bs and Cs exposure, as well as what we’ve done on the towable side and improving that business, as we do that, we’re still — based on the guide we’ve given today, we’re still in that 10% to 10.5% range for the year. But, I guess, you could say we’re probably in that 7% trough margins following the mix that we have when you mix in the As and towables against our Bs and Cs.
Jerry Revich: Got it. I appreciate the discussion. Thank you.
Rod Rushing: Yes. Thank you.
Operator: Our next question is from Jamie Cook with Credit Suisse, please proceed.
Jamie Cook: Good morning. Just two questions. One, if deflation starts to materialize, where do you think you can continue to have the most pricing power? And then my second question, understanding you have a strong backlog with Recreational, but just given concerns of a consumer recession, this business has been driving the majority of your EBITDA growth mix of EPS from Fire and Emergency or just relying on Recreational? Thank you.
Mark Skonieczny: Yes, I think on the Recreation side, like we highlighted, Jamie, previously, I think we’re in a different position than some of our competitors like Rod talked about that and we didn’t get ahead of ourselves in stopping some of the dealer channels here. So when you look at our actual inventory, it’s still down 50% from our pre — from pre-COVID levels and we continue to see strong demand for those Bs and Cs market, as well as we have — as we’ve talked about for our REV’s product and the towables unit, and the towables’ business is more of a niche product and it still has a strong draw from the market. So we have not seen a dip from that perspective and we have actual — our backlog continues to hold up a full year’s worth of production.
So we’re not seeing — even with the minimal cancellations I talked about, we’re not seeing a hit to our full-year guidance at least what we’re providing here. So — and then from a price realization perspective, obviously on the Recreation side, that will be more maintaining the price that we have going after inflationary cost to make sure we get the savings that we deserve as some of the commodity prices come down. And when you talk about price realization, majority of it is getting to that €˜21 and €˜22 pricing that I highlighted in my call, that just given the throughput challenges we have — had in F&E. We have a lot of older units that haven’t had the pricing that’s been injected over the last couple of years, so it’s really a throughput story.
The first half is really, both in Commercial and F&E, it’s getting through the units that have aged in our backlog so that we get the units that have margin expansion opportunity in the second half of the year. That’s really the story here in the first half. It’s all around throughput within F&E and Commercial, and getting some of the older units out of the backlog, and then realizing pricing in the back half that’s already been sold into the market.
Jamie Cook: Thank you.
Mark Skonieczny: Thank you, Jamie.
Operator: Our next question is from Mig Dobre with Baird, please proceed.
