Stephen Rolfs : Yes, Joan, this is Stephen. So on the guidance, I would think it really comes down to a matter of degrees. So you’re correct. We’re not changing our EBITDA guidance. We had said that we would be down mid-single digits, so we still believe that’s the case. So it’s really it was, things are largely unfolding the way we expected. It’s just taking a little longer, and in some cases, it’s been a little bit more severe. So with the incremental downgrade in revenue, we’re moving within that EBITDA range. And then of course, that’s going to impact EPS as well. And the main reason why the EPS is down more than the other, metrics is of course because of the interest expense, but it’s really just a matter of degrees within the range. And things are largely unfolding very similar to what we expected.
Joan Lim: Okay, that’s helpful. Thank you. And then just a question on Red Dye No. 3. So I saw that in the California Food Safety Act, they had banned Red Dye No. 3. I was just wondering how will this impact Sensient?
Paul Manning: Well, I would tell you this. Red 3 is not a real big synthetic dye. It’s one that’s used a lot and for example, bakery applications, but there’s many alternatives to that product. So first things first, it’s not a lot of revenue. And I would tell you that number two, it’s going to open up opportunities for natural colors, which is a good thing. That’s been the drive in our food colors group for 15 years. We’ve done quite well there. So actually, I feel really good about that having a portfolio of naturals that can replace Red 3 and those types of applications because we believe with California’s actions that would have an impact obviously on the entire country. And perhaps you could even change some behavior outside of the U.S. But time will tell about that one.
And I suppose the other aspect, Red 3 has had a rather challenged supply chain for many, many years. So I think that not being as big of a factor, I think that’s a good thing. So in short, I don’t necessarily see a lot of bad. I see a lot more good coming out of that than bad. But that’s the way we operate. We always operate under the assumption that certain products can be replaced in the market. And so our portfolio has been driven about how do you replace these synthetic dyes, which folks want in the natural version. And that’s been a lot of our work. So we are more than ready and willing for this transition.
Joan Lim: Great. That’s helpful, thank you. Can I maybe squeeze in one last question on GLP-1? So what do you think, how will it impact Sensient? Are you seeing any changes in terms of your conversations with customers?
Paul Manning: Not really. I think at this point it’s used by such a small portion of the population. It’s really kind of hard to gauge at this point how that will play out. If this does in fact lead to folks consuming fewer calories, that would clearly have an impact on the food industry in the United States, for example. I don’t anticipate widespread use of this drug outside of the United States and maybe a couple of other countries. And so does that mean that we would see a difference in composition of the types of products customers buy? Too soon to tell. The overall theme around reduction in calories, sure, that could be a real thing. The question is how quickly would this thing ever get rolled out? When do the economics improve?
It’s quite expensive in most applications at this point. So not enough data points, not enough people on the drug to really measure this as a macro trend at this point. So I couldn’t really tell you much beyond that, but I think that we will assume that things like this could be a threat to certain parts of our business. And as that materializes over the next probably five, 10 plus years, I think we could adapt to different types of segments. Different types of product lines that could continue to subsidize our business. But very, very early in the game on that one.
