Michael Leach: Yes, and one of the things, I’ll bring this up a little bit. I think, Danny, you even asked the question before, is that as we did all the acquisitions, you could see revenue line going up, but you also saw the SG&A expenses going up along with that, and that is correct. And at some point, you have to leverage those increased costs to either grow at revenues and earnings some more or to find ways where you can realize some synergies. And that percentage reduction should go down. You should actually see synergies there and start to leverage that.
Danny Eggerich: All right, that’s helpful. I’ll leave it there, thanks.
Michael Leach: Thank you.
Operator: The next question will come from Gerry Sweeney with ROTH Capital. Please go ahead.
Gerry Sweeney: Dick, Mike, thanks for taking my call. Mike, I think this is your last call, so congratulations.
Richard Warzala: It’s his last call? Oh, come on, come on, Gary.
Gerry Sweeney: That’s Gerry, too, by the way, not Gary, right? Anyhow, I know we covered the simplified to accelerate, so I’m going let that be for now. We’ll have some follow-ups on that later today. A&D, just some random questions here. It is obviously lumpy, you’ve always talked about that, but just curious, look at that on an annual basis, how much confidence you have, we’ll say, throughout 2024 that it sounds as though there are some programs that are out there and you feel relatively confident that, that business is well-positioned.
Richard Warzala: Yes, well, absolutely. I think we’ve mentioned over several conference calls that the quoting activity has been extremely high. That didn’t necessarily convert into orders, which was a little bit of a surprise, but we have seen that orders now coming in and as to our expectations that a replenishment of certain materials that’s needed by the defense markets. So we do have visibility on programs beginning to kick in and starting to accelerate mid-year and through the end of the year and some fairly significant programs out into the future. So it is beginning to kick in. And I will state that it is our first, what we would really say is our, internally we call it the Elliott market-specific selling unit, where we want to realize as much value as possible in that market.
And we are backing that up by putting resources in place and having a strong focus on it. And then I just mentioned, we just finished up a global leadership meeting here last week and to see the excitement as we bring our team together, how much we really do from an independent unit standpoint and how much we can leverage when we bring a focus to it and have a central point of sale and contact and support of the continued increase in value in a sale that we will see. Part of that process also is we talk about, and Danny asked the question earlier too, some of the initiatives, but I would say specifically how we process, how we handle orders. We have the acquisitions that we’ve done, we have different computer systems and the transactional costs are quite high because of the way it’s being handled.
And our whole goal is to simplify it, to make one transaction, drive it all the way through the system, have it happen automatically. And to realign the revenues and profits into the right units who are contributing. Sounds simple, sounds trivial, but as the organization has grown, one of the things I wanted to be very cautious of when we hear this many times is big companies become cumbersome and they don’t want to do business with their sister companies. We have to make sure that we do things differently and we prevent that from occurring. And we could see it creeping in and we think we’ve got a pretty good solution. And in the process, we’re going to have a much better focus and we’re going to drive costs out as well as aligning more from a system sale.
And we think there’s a lot of positives there. This will be moving forward this year and it is a strong focus and it’s based upon the demand that we’re actually seeing in the market.
