Richard Olson: We don’t break out parts specifically, but just anecdotally, it’s — it would be a typical run rate for us relative to part’s contribution to sales. It’s been maybe a little bit stronger during this period, but nothing extraordinary.
Operator: The next question, please. And it comes from the line of Tom Hayes with CL King.
Thomas Hayes: Rick, I just wanted to get your thoughts on, especially around the lawn care segment, both residential and professional. As far as your thoughts about the continued battery adoption? Certainly, the residential segments well along that path. I was just wondering your thoughts on the professional side this year going forward?
Richard Olson: Yes. We are — the one thing I can say is we are extremely confident in the platforms that we produce, both on the residential side. The 60-volt is a fantastic product line getting additional access to our — for our customers even as we go forward this year. On the professional side, we’re extremely excited again, both about the products we’ve been able to introduce, which honestly are the culmination of the outcome of the focus that we’ve put on that area for 6 or 7 years. So it’s fulfilling to see the uptake from our customers, especially in specific categories. Golf has seen a higher uptick and uptake of battery-powered products for a lot of reasons beyond just the zero exhaust emissions of noise, operator implications and so forth.
And we just introduced the new Groundsmaster E3200, which will be the perfect product for municipalities. And those are some of our customers that are under the greatest need to provide zero exhaust emission products. So, we have a great lineup in both the residential and the pro categories, and we’re pleased to see our customers get the product that they want. Just going to add, our focus really to be able to provide gas or electric or battery options and have a terrific solution for both customers.
Thomas Hayes: Okay. I apologize for cutting you off there. Just maybe circling back, I know it’s been under pressure for the last couple of quarters. Just maybe any thoughts on the Rental Equipment market?
Richard Olson: Rental Equipment, from our perspective continues to be very strong. It’s really — most of it is some portion of contractor, particularly national accounts are looking at replacing aging fleets, that’s been positive for us. And as there’s been a little bit more construction activity, that’s a driver of future demand for us as well.
Operator: And we are going to our last question, please. It’s coming from the line of Ted Jackson with Northland Securities.
Edward Jackson: Most of my bigger questions have been answered, but just a couple of small ones. First, Angie, can you just talked a little bit about working capital and where — are we still going to see the fair to assume going to see a trend as we roll through ’24 that we’ll have a reduction in it mainly through inventory and more in the back half of the year? Is that a thesis that still kind of hold? Is that a trend that we should expect?
Angela Drake: Yes, I understood your question correctly, you’re kind of quiet. But it is some you’re asking about working capital. We do expect to see working capital improvement throughout the year. The first quarter is typically our peak usage of cash. So as we are growing our inventory and working through that, but we do expect to generate more of our cash in the second half. As you can expect, the drivers behind that cash flow is also working capital, with the majority of our opportunity being and driving our inventory down. So, a continued sharp focus on that, Ted, as we go throughout the year to reduce our inventory, both finished goods and WIP.
Edward Jackson: And when I think about inventory, I’m trying to speak up a little bit, I tend to mumble and I look that kind of pre-coded. Is it fair to say that normalized inventory on kind of a days basis is, call it, 100, 110 days is or so? And is that a level that we could expect to see as you exit ’24?
Angela Drake: I don’t know that we’ve provided that information, but we certainly are expecting to continue to improve it. When we look back pre-COVID, we’ve changed a lot. We’re really a different company. As we look at our makeup today, we added the Charles Machine Works. We have a Ventrac. We’ve added Intimidator Group. We went through a period of needing to increase with inventory so that we could provide to our customers. So we’re still rebalancing some of that. And of course, as we got into the winter season and in Q1, we saw a lack of snowfall that also increased our inventory level. So I don’t have an exact number for you on days, but we certainly feel confident that we can achieve our free cash flow guidance, that we’ve put in place today.
Edward Jackson: Okay. Next question. A little nitpicky, but just to make sure I’ve got it right. What is the — like the dividend payout on a per share basis right now?
Angela Drake: The 6% — a 10% increase year-over-year. I don’t know that I have that right in front of me Ted.
Edward Jackson: That’s okay. I can figure it out just a nitpicky one. And then with regards to the initiatives, the AMP initiatives and the savings you showed in your pro formas for this quarter. Is that something worth modeling? Is there a number that you would suggest that we put in, in terms of our pro forma numbers or just basically just back on that as you show it every quarter?
Angela Drake: So for the benefits and the savings that we expect to achieve, we are expecting to get $100 million over the next three years. So by 2027, we expect to get $100 million in annual cost savings. We have built in, what we expect to see in F ’24, but the majority of those savings will be in years two and three. So more level on the back half of that project than the first part.
