Reuben Garner: So recognizing and not providing guidance, Scott, maybe if you can help. I mean, that seems like a pretty robust outlook with some things working against you like FX and some of the surcharges rolling off. Can you talk about what the kind of underlying organic volume assumption for the year is that gets you to that kind of flattish revenue? I think the contribution from LMI was in the range of $80 million. So I mean, it seems like a pretty modest volume reduction, all things considered with what we’re hearing or what’s happening with the new housing world, at least.
Scott Zuehlke: Yes, I mean, obviously, the reason we can even talk potentially about being flat next year versus 2022, is because of the LMI acquisition contribution. Outside of that, we fully expect demand volumes to come down, the FX impact could be significant. So I mean, there’s that as well.
George Wilson: I think in addition, specifically in the North American Fenestration segment, I think we’re still finding opportunities to gain share in a couple of our product lines, where labor outsourcing is still a big driver for our growth, and even with falling demand, in terms of volumes, the labor pressures for everyone still exists. So those opportunities still arise. So we think that there’s opportunity to maybe offset some of the market volume with share gain. And then we’re working on adjacent materials as well, that we continue to talk about. So it will be a challenging year. And we’re working really hard to do everything we can to offset that.
Scott Zuehlke: And the only thing I’ll add there is, as these index pricing mechanisms kick in, and raw material costs go lower, and you’re having to roll back price, obviously, that hits revenue. But there are also a lot of other costs that George mentioned in his prepared remarks that are continuing to go up. So we’re going to fight hard. We’re going to try to push price where we need to, but the reality is with raw materials coming down, revenue is going to be challenged.
Reuben Garner: So last time, we saw kind of the housing start run rate that we’re seeing in the last few months, I mean, you guys were doing more like $800 million to $900 million in revenue, $1.2 billion is a big jump up from that. I know that there’s some pricing over that time period, but is the share gains kind of the biggest difference between, I recognize that’s just a new housing start number, but clearly some of the rates are going to impact some R&R spending, I think the biggest between what maybe you guys did in revenue a few years ago, and where you kind of are pointing us to for ’23?
George Wilson: I think on a big picture level, what I would say is share gain is a piece of that and the model of continuing to optimize our processes to solve our customers labor issues does continue to resonate. I think we’ve seen in certain areas, especially during supply chain, as people are mitigating risk from Asian supply, bringing things back domestically, that’s been a benefit, and we anticipate will continue to be a benefit. And although we don’t talk a lot about it, because no one segment, or one product line is maybe significant in the big picture, we have products like the vinyl fencing, our solar, our flashing tapes, that all continue to grow within our product line, again, individually, they’re not significant enough to call it out. But independently, they are continuing to roll up and have been great adjacency products for us.
Reuben Garner: Great, and I’m going to sneak one more in if I can. So same kind of line of questioning on the margin from pretty impressive outlook to be able to kind of hold where you are, what would I guess lead to the most pressure relative to that outlook? Is it volume worsening? Or is it more risk on the price costs front? Scott, you mentioned some — still seeing some inflation in some areas, as what’s the bigger kind of item to watch for ’23 on the margin side?
Scott Zuehlke: I think they’re equally both, Reuben. You obviously followed our business well, volume will drop, and we’ll put pressure now. Now, we’ve said all along, and you’ve seen it in the past, we’re able to adjust the volume drops, I think fairly efficient when compared to others. But volume would be a pressure on that margin. And then continued inflation, I mean we’re still seeing it, even though our commodity raw material prices may be dropping, as I mentioned in my script, we’re still seeing pretty high levels of inflation in a lot of areas of our business. And I know, my individual business leaders are really working very hard to offset that. But we’re going to have to go out and try to get price to offset that. Now, why the positive or somewhat positive look on our margin profile, we’ve talked a lot about as those indexes and surcharges roll back.
As we were chasing the tail and the lag on the way up, we’re seeing some of the benefit on the way down. So that should help alleviate some of the pressure. And that’s why we’re probably a little more optimistic on the margin perspective in the year.
Reuben Garner: Great, thanks, congrats again, and Merry Christmas and Happy New Year.
George Wilson: Hey, you too.
Scott Zuehlke: Thanks, you too.
Operator: Thank you. One moment for our next question. Our next question will come from the line of Julio Romero from Sidoti. Your line is open.
Julio Romero: Hey, good morning, George and Scott.
George Wilson: Good morning, Julio.
Julio Romero: I guess to start on the refreshed growth strategy. It sounds exciting. Obviously, you didn’t put a timeline on the targets. So maybe just talk about what investors should expect from maybe the cadence of inorganic growth? And if deals should be kind of tuck-in or transformational?
George Wilson: Great question. I think really, we didn’t give a lot of specific guidance there for a very specific reason, I think we’ve created enough opportunities. And we’re looking at these adjacencies by opening it up, what we’re effectively doing, as we’re telling people, we’re not a Window and Door Company, and we’re not a Cabinet company. We’re a manufacturing company that has a very broad set of operational capabilities and material science knowledge. And we’re starting to see a lot of different looks both from internal organic product development as well as external. So I think as we evaluate inorganic opportunities and M&A, I think that they could be either transformational or bolt-ons similar to the size of like an LMI.
And the reason I don’t give better guidance is because a lot of these markets are new, we’re still evaluating them. We’re looking at it, the favorability of each of these markets and as this progresses, we’ll try to give better clarity on markets that we may like more than others. But it’s relatively new. But I think we’ve positioned our balance sheet very well to be able to handle both transformational and bolt-ons with and staying within a very healthy balance sheet perspective, which has been our goal all along.
Julio Romero: Great. I appreciate the color there. Maybe on the organic growth side, maybe a follow-on to Reuben’s question a little bit. I mean, I was hoping you could expand more on the share gain opportunity, specifically the runway for maybe reshoring from some of your customers as your customers mitigate risk from overseas suppliers. If you could talk a little bit more about that runway and the multi-year opportunity there?
