Hassan Ahmed: Question on the guidance. You guys reported $130 million in EBITDA in Q1. And obviously $160 million to $180 million is the guidance range for Q2. So I mean, taking the midpoint of Q2 guidance, you’re roughly sort of guiding to around $300 million in the first half of the year. And it seems from all your commentary that earnings momentum is developing, right? So the back half should look far better than the first half. And yet, I take a look at consensus numbers, and they are slightly shy of $600 million. So which to me seems highly beatable. I mean is that the fair way of thinking about 2024?
John Romano: Yes, it’s another interesting way to ask the question that Frank asked. But look, I think your comments are reasonable, right? If you doubled 300, you got — you’re still shy of the number that we just kind of confirmed with Frank. So we’ve got some upside as we move through. And I’m not supposed to talk about consensus because Jennifer tells me how to do that. I’ve all referenced that you did — but I think your comments are accurate.
Hassan Ahmed: Fantastic, fantastic. And again, just sort of digging a little deeper into that. You guys talked about fixed cost absorption being a $25 million to $35 million penalty last year, right? So as your operating rates sort of move up and you were talking about sort of operating rates being sort of above 80% now, how much of that penalty was an offset in Q1? How much of it is going to be an offset in Q2? And what does the back half look like?
John Romano: So we’re not going to provide the back half yet. But I would expect if we continue running at this rate. So I’ll let John kind of work through the numbers because we kind of gave you that. It was about $25 million to $30 million in the first quarter. But you have to think about how those numbers work through last year, right? It wasn’t — we said $25 million to $35 million a quarter, but there were quarters where that number was higher. So John, you might —
John Srivisal: I mean we said in Q1 versus Q4, production costs were about $57 million, $32 million was favorable absorption and lower cost or market changes, $15 million from the Botlek idle and then $10 million from higher mining. So if you take a look at that $32 million or so, and then we did answer on the Q&A recently, we do expect a similar amount, not quite the amount, but a similar amount in Q2. So if you take a look at that, it’s additional to this $32 million that we’ve quoted. So you’re already seeing a good amount of it, and that will continue through Q3 and Q4. So that’s why we said that we expect that to recover the $25 million to $35 million from running at lower through Q2.
John Romano: And we’re not — so, I mean, we’re not at the rate where we’re running at full capacity yet because, again, we’re seeing a recovery, we’re on the front end of it, but we’ve still got some capacity to respond to further demand improvement as we see the recovery continue. So we’re continuing to come off of — we’ve been talking forever about the fourth quarter of 2022 was the bottom, it was, and we saw 2023 there was some slow progression, and we’ve finally seen what we would say is a good indicator of the front end of a real recovery. So as we continue to move through the rest of the year, we’ll evaluate that. China is still kind of an unknown. So if China recovers, you’ll start to see impact not only on TiO2 but on zircon as well.
Operator: Next question will be from Jeffrey Zekauskas at JPMorgan.
Jeffrey Zekauskas: When you take a step back and you look at the coatings markets in the United States, they didn’t grow in the first quarter, and maybe they shrank a little bit. And the coatings markets in Europe, maybe they’re flat. And when you listen to the commentary of PPG or Sherwin-Williams, what they say is that they have plenty of TiO2. So when you look at your volume growth, where did it come from? And why isn’t it simply just a restocking of lower inventories with volume to fall off because the TiO2 growth rate is so much higher than the end market coatings growth rate. How do you assess those different pulls and pushes?
John Romano: Thanks, Jeff. I think you got to go back to the last 24 months, right? So let’s wind the clock back to the ’22 and ’23, where volumes dropped 15% each year. So over that 24-month period we lost 27% of our volume. That’s not sustainable either. And you didn’t hear that kind of a reduction from all of those coatings companies. So there is an element of a tremendous amount of inventory that was in the supply chain that we talked about the destocking effect. So part of it was destocking, and now we’re just getting back to normal buying patterns. We’re not back to where we were in ’19 yet. To get to ’21 levels, 2021 was a boom year for a lot of reasons for the TiO2 industry because people were staying at home, they weren’t going out to and they were using products that our products are in.
So we’re not suggesting we’re going to get back to ’21 volumes. But what we saw over the last 2 years wasn’t sustainable either. Now we’re getting back to what we would refer to as just more normal buying patterns. There has been no significant replacement for TiO2, where 15% of the demand can just drop away on an annualized basis. So when you think about our growth, a lot of that growth is just getting back to normal buying patterns and feeding through that supply chain, which has been bloated with inventory and has been now depleted and we’re starting to see upticks in demand. And I’m not going to speak to what or who you’re speaking to with regards to the customers, but we’re supplying all of them.
Operator: Next question will be from Vincent Andrews at Morgan Stanley.
Turner Hinrichs: This is Turner Hinrichs on for Vincent. I’m wondering if you could provide some additional color on industry operating rates and how the supply and demand balance has trended by region?
John Romano: So on industry operating rates, we’re not going to really comment — it’s hard for us to comment on what everybody else is doing. We gave you an indication on where we were. And I would expect, as the market recovers, everybody is going to start looking at how — at their operating rates and how they’re going to respond as the demand continues to recover. So with regards to — the second part of your question, was it regional demand? Or could you just —
