And as we said on the last call, the savings will be about 40% of the total. So we think we’ll be at a run rate of, call it, $20 million of savings as we exit ’24 and heading into ’25.
Operator: We’ll now take our next question from Matt Roberts with Raymond James.
Matt Burke: Adam, if you could just please expand on — in regard to George’s question earlier on pet food, I believe I heard 2024, you’re expecting mid-single-digit growth rate in that, correct me if I’m wrong, please, but that was going to be dampened in first, maybe into 2Q from destocking. So — if you could provide any additional color into how inventory levels were exiting in 2023? And what indications are there that potentially more supply is coming online? Or just trying to reconcile getting to mid-single-digit growth there after destocking in the first half.
Adam Greenlee: Sure. And you’re right. So there is some continued destocking in the first quarter. I think we’re being a little cautious, Matt, because as we’ve seen in other categories, that destocking does sort of linger on just a little bit longer. So we’re working with — closely with our customers. And as you well know, we’re near site or on site with many of those customers in this category. So we’ve got really good visibility into what they’re filling plans are for 2024. They’ve added some additional capacity as well. So that’s helpful. So as we think about it for the year, you’ve got some destocking activity that will cause a difficult comp for us in the first quarter, and we will see growth the remainder of the year in pet food. And on a full year basis, again, remember, our first quarter and fourth quarter are 2 seasonally smallest quarters in the Metal Containers business. So we anticipate nice growth for the full year as we sit here in wet pet food.
Matt Burke: And then on high-value [indiscernible], and I might have missed this in the prepared remarks as well. But I believe in the release, you said further growth in 2024. How does that compare to the growth rates you saw in that category in 2023? And what factors are driving that for either higher or lower than 2023? Is it new products and new customers? Or just any additional color on that high value would be great there.
Adam Greenlee: Sure. It’s a highlight for us. It’s an area where we’ve been winning in that market for sure. We’ve seen really nice growth. And I would say we’re still expecting significant growth in that particular sector. It’s just — it’s moderating just a little bit. So instead of very consistent kind of mid-double-digit levels, we’ll be kind of low double digits, high single digits as we look forward into those products. And that’s still get the volume. So I think we’re going to be ahead of the market for whatever that’s worth. And again, we’ve added capacity as well to support that continued growth. So that growth comes with new product launches. It comes with innovation. It comes with growing customer relationships. So we’re having a lot of success in that market because we are doing what Silgan does. We are standing and delivering on our commitments and winning with innovation in that market.
Operator: We’ll now take a question from Gabe Hadje with Wells Fargo.
Gabe Hajde: I had a question about — I guess, Adam, as we look at the guidance and positioning for the business into ’24. Fast forward, we’re having this conversation, you talked about closing 5 facilities as part of the $50 million cost out initiatives. I know it’s sensitive to talk about in a format like this. But are there other plant consolidation efforts that you have to execute against? And what are the biggest risks against kind of getting to that $20 million run rate number? Or do you all feel like that’s pretty well in the bag and then maybe upside from there?
Adam Greenlee: Sure. And they are tough decisions, Gabe. And what I would say is the 5 that we’ve announced to date go a long way to supporting the $50 million in total. Unfortunately, it doesn’t get us all the way there. So there will be some additional activity, call it, over the course of the next 12 months that we’ll be engaging in. Those are fluid plans, and we’re continuing to evaluate and from my perspective, Gabe, this is nothing new for Silgan, unfortunately. We’ve had such a — it’s not unfortunate. Fortunately, we’ve had such a focus on driving cost out of our operations over time that this is just kind of the next page in the playbook. And we’re responding, as we said, we’re going to rightsize our capacities to market demand, and we’ve done that.
We’re doing that. And we’re continuing to evaluate where additional opportunities to drive cost out of the system can take place. So you should assume that there will be some more activity in the course of 2024 to get us to the total $50 million by the end of ’25.
Gabe Hajde: Maybe Bob, one for you. It seems like some of the top webs are getting cleared out of the M&A markets, we’ve seen a couple of things were at a loose here. That’s been a pretty big value driver for Silgan historically speaking. Again, to the extent you can comment, I know you guys are always trying to be busy there, but anything that you get excited about or that we can be talking about maybe in ’24 and/or uses of cash if that doesn’t come into fruition, balance sheet closer to 3 times leverage, do you see the stock as attractive at current levels?
