Operator: The next question comes from us to Aleksay Yefremov with KeyBanc. Your line is open.
Aleksey Yefremov: Alberto or Steve, on Slide 6, you list the key categories of the products side interim pipe et cetera. Do you just provide sales performance commentary? Do any of the categories stand out to you so far this year is particularly strong or not?
Steve Bender: Yes. I would say, Aleksay, that those that I spoke to really were, as I say, the Pipe & Fittings and Siding & Trim are those that we continue to perform very, very well in this business. They are, I think, really strong positioned in the marketplace with the competitors. We have a strong positioning in our Fittings business and on our Pipes business, and of course, Siding & Trim. We continue to see really good improvement in the Boral businesses that brought roofing materials and Windows as well as decorative stone. So I would say that acquisition has really continued to perform well. And you can see from the results that those branded products continue to really be good selling points with our nationwide customer base. But I would say those that we called out specifically in this quarter, the Siding & Trim and the Pipe & Fittings were those that really strongly performed.
Aleksey Yefremov: And then maybe more of a big picture question. On your HIP business, you’re obviously looking for additional product line acquisitions, but you talked before about potential opportunities to unlock the valuation discount for the business. As you think about those options, is the stock merger was another sort of publicly traded or another large building products company an option that would separate the epical business from the building products?
Steve Bender: Yes. I mean as we think about opportunities to build out the businesses, looking at acquisition currencies, whether they’re cash or equity-based are all issues that would be well considered. It’s just a matter of what the value proposition is and really what is of interest to the other side. So those considerations and that kind of currency or freely available to us. It’s just a matter of what is interesting and value oriented to the other side of the table.
Operator: The next question comes from Hassan Ahmed with Alembic Global Advisors. Your line is now open.
Hassan Ahmed: I just wanted to touch on the sort of qualitative points that you talked about with regards to your guidance and maybe sort of turn that into a bit of a quantitative side of things as well. I mean, you guys did $546 million in EBITDA in Q1. And from the sounds of it, you’re talking about destocking being behind you, obviously, we’re going into a period of seasonal strength and the like. And it seems that there is volume and pricing momentum as well. So is it fair to assume that — I mean $546 million annualized $2.2 billion, so 2024, it appears like at the very least, you’ll make north of $2.2 billion. Is that kind of the right way of thinking about things?
Steve Bender: Hassan, as we think about guidance, as you know, we don’t provide kind of the consolidated company guidance though we do provide it for the Building Products business. And I think as you can see from our prepared remarks, that pricing seems to have stabilized at this point across the chain. And that’s, I think, very important. But as we think about the outlook, the questions still remain in terms of how we see the pricing trends in the back half of this year and volume trends. So we have a constructive outlook, as you can see, but we’re not providing any numerical guidance for West Lake on a consolidated basis.
Hassan Ahmed: Fair enough. Fair enough. And just changing gears to the box side of the business. One of your competitors that actually separately discloses their epoxy results. From those results, it appeared that Epoxy is kind of turning a corner, EBITDA turned positive for the first time in a couple of quarters there. So could you talk a bit about what you guys are seeing in terms of the market dynamics there, the supply-demand fundamentals there in a sort of business going the way it’s going scenario as well as in a scenario where these antidumping cases that are being brought about actually go through?
Albert Chao: Yes. We are seeing a slight improvement in epoxy prices through all the regions in U.S., Europe and Asia. And we are seeing some demand improvement as well. And also, we’re seeing a bit less imports into U.S. and Europe. So things are looking better, but I think the dynamics still a lot happens on renew energy with wind mills and with coating, which associated with construction infrastructure. So I think the general economy globally would impact on the global demand for Epoxy. So we are seeing some — a little bit of signs of improvement. Again, the dynamics, the different Asia is weakest and then Europe to do better and the U.S. is the better region generally speaking for these 3 regions, but things could change.
As Steve mentioned, we don’t know the second half with so much uncertainty from inflation, interest rate geopolitics and as well as elections. So — but I think longer-term basis, we are very optimistic on both HIP and PEM segment, as we alluded to in our comments, and we work to reduce our costs, strengthening our positions in all these products, including M&As. And we are open to all ideas on M& as well. And our goal is to really earn above cost of capital and with our financial asset base, we can do deals that make sense to us.
Operator: And the next question comes from Mike Harris at Goldman Sachs. Your line is now open.
Unidentified Analyst: [Indiscernible] this morning. And I have a question on HIP. On Slide 6 in the earnings deck, you show a U.S. TAM of roughly $40 billion. And looking at the current annual HIP sales would suggest that even though you have a number one or number two market position for the most part, you still only serve about 10% of that TAM. If so, how should we think about the other 90%? I mean, can you pick up meaningful market share with the current portfolio? Or would it require more M&A? And if more M&A, how would you rank your HIP in the list of growth opportunities?
Steve Bender: Yes, Mike, good question. And the answer is you’ve seen that we are continuing to look at broadening the overall portfolio in our HIP segment. The acquisition of Boral and Alaska are really good examples of ways we’re adding to that portfolio. This broad total addressable market is one that we think has got good opportunity. The — in our prepared remarks, we spoke about the underinvestment in both infrastructure and in housing. When you think of the housing market being probably a 40-year age average, it has great opportunity to continue a need for both repair and remodeling and new construction activities. And of course, the infrastructure bill provides great opportunities for us to continue to invest and opportunities to grow in that area.
