So I would expect something more in line with Q4 and then sequentially growing thereafter, as we said on the call, and that’s based on what we’re expecting from the timing of deliveries and also from the timing of how the vinyl initiative is ramping up. And the other thing is that, as you know, in January, we have a scheduled maintenance where we only had about 20 days — 20 working days. So that has an impact in there as well, which we did not have in January of last year.
Samuel Darkatsh: Yeah. Because that’s normally in December, right?
Santiago Giraldo: Yes, more in December. So this time is going to be a little bit unusual.
Samuel Darkatsh: Got it. So the gross margin and EBITDA, similar to fourth quarter or just gross margin? I was trying to get a sense of EBITDA also. I’m sorry.
Santiago Giraldo: I think EBITDA could be in line or slightly lower based on the mix of revenues. And then, as I was saying, just ramping up throughout the year.
Samuel Darkatsh: Got it. And then I respect the reticence to talk about EBITDA for the entirety of ’24 because of macro uncertainty. But if you just thought that the sales growth would be 10%, which is the low end of your double-digit growth expectations, how should we think about what prospective EBITDA might look like under that scenario?
Santiago Giraldo: I would consider two things on that. You’re going to get operating leverage on higher sales, but then you’re going to have the effect of FX, which for 2023 was at 4,325 (ph) and what we’re projecting for 2024 is in line with current conditions, which is 4,000. So you’re talking about the peso being stronger by about 8% to 10%. As we discussed earlier, and we alluded on the call this morning, for every 5% movement on FX, you have about 150 basis points of impact to operating margins, right? So at the end of the day, you’re going to have operating leverage, helping out with double-digit growth, but then you’re going to have the impact of FX for the full year, which we see stable, but then 8% to 10% stronger year-over-year versus 2023. So if you kind of back into it, I think we can — there’s a chance that we can grow EBITDA, but it’s going to be probably more in line year-over-year based on mainly FX and mix.
Samuel Darkatsh: Got it. So we would use a normal — sorry, you’d use a normal incremental margin on the 10% volume growth and then apply a 300 basis point or so headwind from FX? Is that the way to think about it holistically?
Santiago Giraldo: Yeah. And if you look about the guidance or the high-level color that we’re giving on gross margins, we ended up at 47%. And if you do kind of the math on gross margins that we’re talking about for 2024 and discussing mid-40s gross margins, you already kind of have that effect baked in there, right? I mean you have a 300-basis-point effect on FX, which gets you to about 44%. The difference from then is going to be how much operating leverage can we get, how fast is this residential initiatives going to ramp up. So that’s going to be the upside. And obviously, we can get more operating leverage on those higher revenues. But then you kind of offset that with the fact that we’re going to have more installation mix. So those are the three variables that are kind of playing a part in there. All-in-all, I think that mid-40s is probably the run rate and the adequate way to project gross margins.
Samuel Darkatsh: And then my last question, thank you for that Santiago. My last question, lots of price increase announcements from U.S. windows — single-family window manufacturers and a lot of your competitors of late. Are you anticipating raising prices for single-family resi in line with those announcements or are you looking to keep pricing flattish and maybe pick up some share as a result?
Jose Manuel Daes: Well, we don’t have any plans to increase prices because to the contrary, we have good sources for aluminum and glass. We see no price increases on that end. So our clients are very happy with our price point. And actually, February was better than expected month than August. So we’re very happy with where we are right now. We’re not going to increase prices, at least not this month or next.
Samuel Darkatsh: Very helpful. Thank you, gentlemen.
Santiago Giraldo: Thanks, Sam.
Operator: Thank you. Our next questions come from the line of Stanley Elliott with Stifel. Please proceed with your questions.
Stanley Elliott: Hey. Good morning, everybody. Thank you for the question. On the vinyl initiative, can you talk about how much you’re assuming that vinyl would contribute to the double-digit revenue growth you guys are targeting for the year?
Santiago Giraldo: Yes. It’s basically weighted towards the second half, first of all, because what is taking place right now is the delivery of sampling and testing of the product, so bear that in mind. But we are seeing that contributing more meaningfully in the — after the second quarter of the year to the range of probably $20 million to $25 million in total orders. Now if it ramps up better than expected, that’s where you’re going to see the upside come from. But early indicators on feedback and what’s going on right now are encouraging, Stan.
Stanley Elliott: Great. And then could you remind us again kind of what you’re thinking about from a CapEx perspective for the coming year, now a lot of that heavy lift is done. And then how are you all thinking about maybe accelerating a buyback at this point?
