Mark Tkach: We have got 24 products coming in, it is holding a better margin. I mean there’s a lot of — there’s always demand for 2024 products. Every new year, our consumers really love their toys. They want to have the coolest, the newest thing that’s out there. And there’s a lot of that generally gets released by the OEs early ’24 models that will come out late in the 23 years. So we’re really, I think, focusing on the efficiencies of what we do, covering the expenses again and really trying to offset some of that inventory correction in some of these campaigns that we’re running now with the rebate, the incentives, and the ’24 product that’s coming in, we’re getting all the money for the 24 product.
Seth Basham: Got it. And my last question is just thinking about the used to new ratio into 2024 with some of the changes to your cash offer, and it seems like a little bit less emphasis on the used business. Should we expect the used to new ratio to change meaningfully next year?
Mark Tkach: We’re running a 2:1 right now to new to used. We’re happy with that ratio. We have slowed down a little bit on our acquisitions, but at that time of year. I mean we really don’t want to ramp up our acquisitions till January, February and into early March to really ramp everything up for the summer. So we’re right where we want to be. We’re going to turn that knob and right now, we’re loading some of the dated stuff, but we’re really leading it up, is going to get ramped up January, February, March, and we’ll be ready for the summer with 2 to 1. You might see that even shift a little stronger, maybe 1.75 to 1 in the spring after we load up with that product. It’s going to fluctuate a little bit, but on a year annual basis, we’re quite content right now with a 2:1 ratio.
Operator: Thank you. [Operator Instructions] Our next questions come from the line of Michael Baker with D.A. Davidson. Please proceed with your question.
Michael Baker: All right. Jumping back in. Thanks. Maybe it’s in your filing somewhere, but remind me, just walk through, again, how the debt goes from, I think you said $311 million to less than 200. And remind us what your revised covenants are in terms of leverage ratios and how long are those revisions permanent or temporary waivers? Just remind us how that works?
Blake Lawson: Yes. Great question. So $311 million goes to below $200 million, really with the $100 million rights offering, where $50 goes straight to principal debt. And the other $50 million is in your cash account. So which there’s also, obviously, we’ve got one more real estate property, which will get us another $7 million, call it, and the finance portfolio coming off. Right now, the principal balance of that is about $14 million. That will go away as well as some proceeds up to $15 million to pay down debt. So should easily be below $200 million at the end of the year, just with those facts. And as far as our covenant, with Oaktree, we did have relief for Q2 and Q3 being in the form of not even being tested. And then in Q4, that covenant starts at a total net leverage of 5.5, and then in the first quarter it dropped to 5 and that’s for both total net leverage and secured net leverage.
So 5.5 and then 5. And then in Q2 of 2024, it goes to 4.75 for total net leverage and 4.25 for secured net leverage. And then in Q3 of 2024, it goes to 4.25 billion of total net leverage and 3.75 of secured net leverage, which is where it actually was to begin with. So it goes back to where it was to begin with in next Q3 in a year.
Michael Baker: Okay. Maybe these are dumb questions relative to that. But the calculation, so the numerator, I guess, is net debt, right? So you give yourself credit for the cash and the denominator, is that the annual EBITDA outlook or is it trailing 12-months EBITDA, or just remind us.
