Scotts Miracle-Gro at William Blair Conference: Growth and Sustainability Focus

On Thursday, June 5, 2025, Scotts Miracle-Gro (NYSE:SMG) presented at the 45th Annual William Blair Growth Stock Conference, outlining its strategic transformation and growth prospects. Led by COO Nate Baxter and CFO Mark Schrier, the company highlighted its focus on becoming a lifestyle brand, emphasizing organic growth and margin recovery. While the outlook remains optimistic, challenges in macroeconomic conditions were acknowledged.

Key Takeaways

• Scotts Miracle-Gro aims for 3% annual sales growth, leveraging innovation and e-commerce.
• The company targets a 30% gross margin this year, with improvements expected through cost savings.
• Focus on sustainability, aiming to transition to synthetic chemical-free products.
• Expansion into organic and indoor gardening to attract younger demographics.
• Strong emphasis on supply chain optimization and automation for cost reduction.

Financial Results

Scotts Miracle-Gro reaffirmed its commitment to low single-digit sales growth for the current year, with a long-term target of 3% annual growth. The company reported a 5% sales growth over the past seven years. Gross margins are expected to reach 30% this year, a 370 basis point improvement from last year, primarily due to $75 million in cost savings from supply chain efficiencies. The company aims to achieve mid-30% gross margins over the next two years. EBITDA is projected between $570 million and $590 million, with free cash flow expected to be approximately $250 million for the current year. Capital expenditure remains around 2.5% to 3% of net sales annually.

Operational Updates

Scotts Miracle-Gro is heavily investing in automation to modernize its supply chain, targeting $75 million in cost savings this year and an additional $75 million over the next two years. E-commerce revenues have grown to nearly 10% of total revenues, with 12 million units shipped directly to consumers. The company is expanding its organic product line, with notable market share gains in organic soils and plant food. Maintaining a strong sales team, Scotts generated approximately $50 million in revenue from off-shelf placements for one retailer.

Future Outlook

The company is focused on achieving above 35% gross margins through strategic pricing and sales growth. Capital allocation priorities include debt repayment and potential share buybacks within the next one to two years. Scotts aims to transition to a more sustainable business model, moving towards synthetic chemical-free products. A new digital interface is being launched to enhance consumer education, with AI tools providing personalized advice to consumers.

Conclusion

For a detailed understanding of Scotts Miracle-Gro’s strategic initiatives and financial outlook, refer to the full conference call transcript below.

Full transcript - 45th Annual William Blair Growth Stock Conference:

Operator: Alright, everybody. We’re gonna get started.

John Anderson, Analyst, William Blair: Thanks for joining us. I’m John Anderson, the analyst of William Blair that covers consumer staples, including South America Grill. Today, we’re pleased to have Scott’s chief operating officer, Nate Baxter, and chief financial officer, Mark Schrier with us to present. Scott is, by far, the leading provider of branded do it yourself lawn and garden products in The US. Most of you know it, it’s based in a range of categories from lawns to gardens and controls.

Over past couple of years, the company has undergone pretty bit of transformation, which we believe position it for sustainable sales growth, significant gross margin expansion, and for a much stronger balance sheet going forward. This is moat. This company has a wide moat, which consists of brands, its r and d capabilities, and its unique go to market model. We think this is an pivotal year for the company in its journey to delivering more defensive profit growth. Before handing it over to management, just a couple housekeeping items, immediately following the presentation, we’re gonna complete the session with the entire team in the Adler Room.

Please join us for that. And last, just to inform you, a complete list of research disclosures or actual conflicts of interest can be found can be found on the William Blair website. So with that, I’m gonna turn it over to Nate to get started.

Nate Baxter, Chief Operating Officer, Scott: Alright. Thank you, John. I’m gonna kick this off a little bit by just giving you some color on the business, our brands, where we’re headed, in particular, looking towards the future, some of the transformational changes we’ve made, and then I’ll I’ll turn it over to my colleague, Gerard, who will take you through the financials. You know, one of the things that for me, joining this company two years ago was all about joining an iconic American company, and I believe that, you know, to my core. And that’s been reaffirmed in the couple years I’ve had to work a team here.

We’ve got great brands, great products. You know, people wanna get out and garden, and they wanna enjoy their green space. I think our challenge is how do we evolve to become more of a lifestyle brand with consumers? You know, how do we provide everything the consumer needs to have that beautiful green space, whether it’s in the backyard, whether it’s on the patio, inside their house. And as we dissect our business, and I was just sharing this with John, we we’ve got so much growth opportunity.

I’ll I’ll take it through that algorithm because I don’t think it requires big swings. I think we’ve got a lot of organic growth just in the existing categories we play in that allows us to drive the margin recovery, and I think will really allow us to hit Jim’s targets in a couple of years. This is what I think gets back to our base position where we can start to look at how we wanna grow beyond that. I’ll take you through the story a little bit today, and then we can talk about q and a. So I hope everybody knows our brand.

There’s a new brand that’s on the top right. It’s one Scott and Jones. It’s a legacy brand. It’s it’s really started, and it’s an all natural brand. It’s just it’s own natural lawn food and seeds.

And during q and a, you can ask John, who’s the GM of that business, about what that’s doing for us. And it’s not so much about the dollars at this point. It’s about our ability to be agile and launch new brands and get a new channel, which is an e com play. Primarily, I think we’ve got it in a few stores. And that’s really gonna be the team when we talk about growth.

We know the the retailers are crucial to our business, and they’re they’re very important partners. But just like them, we know we’ve gotta look for growth channels, and I’ll touch that in a few slides. You know, I look sort of like I say, we have the GE model here where we wanna be number one or number two with all of our brands. But even being number one, you know, we’ve done 11,000,000,000 TAM, and and we’ve been, call it, 3 and a half billion of So right there, like, you know, my thesis of there’s plenty of organic growth to go achieve within the existing market with existing consumers, I completely believe in. And I’ll touch on a few things.

You know, lawns and particulars part of the reason we brought John. We’ve got a really good story there where we’re not only revamping our product line over the next couple of years, but more importantly, we’re really focused on messaging and the education. We’ve gotten to a point where our products were sort of once a year applications for many lawn consumers and the next generation of lawn consumer needs to understand that multiple applications a year is what really drives a successful lawn. It also works towards our sustainability goals because the more you feed the lawn, the better it is and the less you feed and weeds you have. And therefore, the less pesticide and herbicide you need to put on the product, which, by the way, we’re hugely supportive of.

You know, we it’s important for us to look forward to a sustainable future, and I’ll talk about that when we get to an r and d slide. But proud of these brands, and I feel like stewardship of these brands is is really what my job is all about. So, you know, we’ve invested heavily in our insights organization. We’ve rebuilt a company that started coming out over the last couple of years. We recognize consumer is changing.

It’s safe to say we’ve relied heavily on, you know, the older homeowner. They’re still a very important consumer. They’re not going away. We know that housing for younger generation is a challenge, but we also know that those who own homes and invest in their lawns really feel strongly about it from these statistics here. Consumers see this as an effect, and that’s a trend that’s sort of come out of the pandemic and and we’re sort of leaning into.

We are seeing shifts from do it for me to DIY. I think that shift happens every year, but we’re seeing more consumers engaged and and the lesson we’re learning here is education. So I’ll talk a little bit in a minute about where we’re headed. We’re going to have a completely new sort of digital interface with the consumer this fall, and it won’t be perfect out of the gate. We’re gonna consolidate all our websites.

We’re gonna have more of a lifestyle feel. More importantly, it’s not necessarily about directly selling products, although that is critical, but educating the consumer. We’ve got a team that’s bringing an AI tool that’ll come into play even on our existing websites in the form of search. We’ll have a more interactive website that’ll be coming where we are using, call it, a hundred and fifty years of knowledge that we’ve built through science, weight papers, and consumer experience, and that is proprietary information that we will contain in our large language model. We will leverage that to be able to provide answers to consumers.

In a perfect world, it’s a QR code. We’ll have an app. You can put you put a name to that, Scotty. You can send a picture of a problem, a picture of a of a graph type. We can help you understand what what you need to attack, whether it’s an opportunity to grow something or dealing with a problem that you might have.

And we feel we’re uniquely positioned to do that. And we’re gonna do it in a way that is is harmonizes with what our retailers are doing because everybody’s got an AI app. But, you know, we believe we have a right to go on to the source of education, and we think that’ll drive consumer engagement. Especially as we start to look at these cohorts, you know, this this cohort of older gen z and the millennials that have been really prevented from homeownership today. They are actually bigger than the boomer and gen x.

They are coming. It might be five to ten years from now. Part of what we have to do is engage that consumer today. And if you spend any time on Instagram, you see there’s an awful lot on there about house plants and growing your patio or balcony. We’re gonna start to lean more into that.

You know, our focus this year in gardens is getting our organic product line expanded, and I feel like we’ve done a great job there. So we’re now gonna start leaning into indoor gardening and engaging those consumers as well as we try to bring them along. And while it’s a long play for us, we believe it’s important as we look out for the past five years. So I think that’s an important statement because, you know, as you know, here here when I joined, we were very short term focused. By that, I mean, weeks and quarters.

You know, we’ve now put a vision out for three years for fiscal twenty seven. So that’s the table stakes getting back to a financial position, and and Mark will talk about that. We’re now starting to talk about what’s beyond that, and I think that’s important. I’m coming on maybe just a couple of quotes here from from Ted and and Marvin, but, you know, our consumer is healthy. They’re homeowners.

They generally have high incomes, low debt. So I know there was a lot of nervousness, obviously, last couple of years with inflation, obviously, all of the tariff and consumer sentiment concerns. I wouldn’t say we’re immune to it. I think people are choosing how to spend their discretionary dollars wisely, but we are largely unaffected. And I think we’ve been able to manage through that, and and hopefully, the reaffirmation of guidance that we’ve got up this morning shows that we’re facing a market where it’s ultimately in the weather.

You know? I know we always talk about weather. It is a factor, but it’s not the biggest factor. At the end of the day, it’s one or 2%. And forget about it.

We’ve gotten more sophisticated about how we manage through it, and we can talk about that in q and a if you want. And then, you know, consumer sentiment, I think, is something that brings everybody down, but we haven’t seen an impact in our numbers this year from there. We talk about our superpowers, you know, our brands, our innovation, our supply chain, our sales team. I talked about brands, little bit of innovation on the next slide and and supply chain. You know, sales, I I just I wanna comment on this because, you know, a big part of our expense is maintaining a field force that is by and far larger than any of our competitors.

The reason we do this is the relationships that they build at the store manager level allows us to drive a ton of off shelf activity. I was actually here in the Midwest talking to our sales leaders here. For one retailer, something like 50,000,000 of our revenue this year was taken completely off shelf, not part of Planetgrams. And I think that’s something we probably don’t talk enough about. You know, we talked about going in the line reviews, which are happening this time of year.

We can’t fix on planograms and pricing, but what we don’t talk about is either around short elbows trying to make sure we get some gaps, and and it’s a meaningful number for us when we look at our growth. Continue investment brands. Jim talked a lot about that. Don’t worry about Comcast. It’s in a really, really good place.

We just decided that we were gonna allocate our dollars elsewhere, but we have high commitment to invest on those brands. We will continue to do that, and our brand health scores reflect that. Let me take a pause here because I think, you know, when we talk about our growth algorithm, I talked about the opportunity for organic growth within the existing TAM, but we also have to drive it through innovation. And that innovation has to look to where the consumer is going. Safety, sustainability is important.

We’re probably the only company in this case. And if you if you look at some of the little notes on the right, lean heavily into organic, probably continue to grow and dominate across all of the categories in natural. We’re working with the GAG partners on biologicals. You know, I I have a vision that in ten years or so, we could say we’re gonna be a synthetic free chemical synthetic chemical free company. Whether we can really achieve that or not, I don’t know.

But we we sure are gonna try, and we know from some of our partners that there are biological and natural formulations to either supplement and synthetic chemicals. You need to use less chemicals to keep the perspective, and then the ultimate decision would be to replace those. So I feel we’re the only one that’s gonna able to invest in that. We continue to look at packaging. We talked about Owen or I talked about Owen Scott.

Products is now in a fully curved recyclable paper bag. We’re very cognizant of the amount of plastic we put out in the world and continue to work on not only packaging, but small form innovation. We care a lot about the indoor gardening space, and we’re in ’26 and ’27 gonna start to really expand there. On the left, you know, these are just some successes. The top is our exclusive across our max line.

That came out of the gate last year, really strong. Slow that you see organic line. Huge huge gains this year. Just year to date, soils for organic line is up seven percent in terms of market share gains, and organic plant food is up 3%. We see a consumer that wants more options in this space, and we’re gonna continue to invest in those.

Supply chain, this is what’s been making it happen. This is why we’ve been able to affirm our guidance and our gross margin recovery. We’ve leaned very heavily in automation. As we all know, we invested heavily in expanding supply chain during the pandemic. That was a bad move.

I think a lot of retailers got caught in that position. But what we’ve done is we’ve shrunk it as we’ve modernized it. So we’re leaning heavily to automation. We’re driving utilization on a on a because it’s such a peak business, we tend to have very high utilization during certain periods and very low utilization. The others came out of semiconductor where if you’re not utilizing your CapEx at as high rate as possible across the year, you’re not winning, and that’s where we’re gonna head with supply chain.

And in general, we try to get 1% of COGS, call it 20,000,000 a year out. We’ve committed to 75,000,000 this year and a hundred and 50,000,000 over a total of, you know, three twenty seven, and we are definitely on track, and I’ll let Mark talk to that. A lot of automation the the guy that came out of Texas is an area that, to me, is really easy and, finally, managing changes that put in younger leaders who are more tech savvy, and we’re starting to see results of that. You know, I wanted to talk about ecom because when we talk about our growth algorithm, you gotta go to where the shoppers are, and part of that is online marketplace. And I talked about that broadly.

It’s our own b two c, which today isn’t huge, but we’ll continue to lean into it. You know, when we go through this rationalization, which is something we are going through right now, we know that we have to start to segregate SKUs that are big movers and margin drivers for retailers. We need to segregate SKUs that are ideal for ecommerce. And by the way, those are both small and large. A big part of our ecommerce platform is now pallet delivery of mulch and growing medium, some of these bigger and heavier objects.

So that’s an important part of that story. Then we’ve gotta figure out how to support the retailers and their ecommerce. So if you look at where we’ve come last year, about 8% of our revenues were driven through some form of ecommerce. It’s just under 10% this year. So if I were to I’d say we end somewhere between nine and a half and 6%.

To frame that last year, we shipped about 6,000,000 units direct to the consumer’s home on behalf of not only our small c to c business, but also our partners. Year to date this year, we’re at 12,000,000. So one of the benefits I inherited of all the investments supply chain is a very, very robust network for direct to home delivery. Now it’s not all about direct to home. It’s buy online, pick up in store.

So there are many flavors, and quite honestly, I’m agnostic of it. So I think we need a c to c business. It’ll probably be that long scale of SKUs that are making extra SKUs that don’t make sense to push into retailers who are gonna address those. So I think with that, I wanna turn it over to Mark and let him talk us through the financials, and then we’ll take questions from the Q and A.

Operator: Sure. Alright. Thanks, Nate. Before I jump into the to the guidance and a reaffirmation, I just wanna give you a flavor of the employees at Scott, what we believe in, and and hopefully, you can get a feel of you know, we love the company. We’re consumers at heart.

We love the brand. We are a branded consumer company, first and foremost. This industry has been around for many years. It’s stable. It’s consistent.

And the thing I’m excited about that we just spoke to is we’ve got a lot of growth opportunity in the future, both through ecomm channels, through frequency, getting that educating that consumer to use our products more. I started as a as a homeowner in my 20. I went an eighth hardware store, learned the four step program, getting educated really by top miracle pro on what it means to take care of my yard. We can do more and more of this to drive frequency. Now I go into all the other retailers, whether it be Home Depot, Lowe’s, and it’s even more exciting now as as Nate talked about the ecom side when it comes to our our our partners.

You can deliver pallets of of soil and mulch now to customers to consumers at at your home. So we are doing things now that’ll help us with our growth algorithms, our sales growth in the future, it it’s what gives us our right to win. Over the past several years, miss Per has it up here that is a little history of our sales, it shows that we’ve grown sales. It shows that we’ve taken a listing game. It shows that we’ve innovated, and it shows that we can continue to do that.

It’s very consistent. I would tell you that from a long term perspective, we set out a target of three percent annually for sale, and we believe in that. It comes through innovation. It comes through pricing. You know, being the national lawn and garden company, consumer products company that we are, we offer a wider range of products.

You need to spoke to all the brands, but, you know, if you look at them in in the categories, lawn. We offer fertilizer. We offer grass seed. We offer plant food and garden. We offer soils, mulch.

In the control space, we offer a wider range of insecticides and herbicide, weed killing products. We offer rodenticide products. These are all wide range of things that we offer, and we also offer mulch, which is high velocity skew. Why do I say all that? It allows us to take pricing.

It allows us to innovate in all of these areas, and it allows us to to grow on an annual basis. You’ll see here over a seven year period through through last year, we grew the through our sales now 5%. We’re we we we reaffirmed our our sales guidance for this year to be low single digit. So it shows that we have the ability to innovate and to grow our sales. Some of the recent innovation and and Nathan, she told us that I’m excited about, Miracle Gro Organics that was launched last year with Martha Stewart campaign.

It’s a pink bag. And we’ve got some other cool things, as you mentioned, to do Owen’s stuff. Over the years, we’ve we’ve we’ve innovated over the past ten to fifteen years in some really cool things that are thicker in the fertilizer space, is a grass seed and fertilizer product that’s an all in one solution. We’ve also, in the fertilizer space, have other all in one solutions that provide a multitude of outcomes. So he he I would say over the years, we’ve been able to prove that.

We have a an amazing r and d team. And the reason we’re able to continue to grow our sales, and I and I just come back to I’ll I’ll kinda reiterate, and it’ll help define what we can do on gross margin is our supply chain team. Our supply chain team helps us deliver product quickly in season to customers. We’re a national garden a national consumer product lawn and garden company, And we can get product to consumers and to our customers quickly, reliably, and on time. That’s super important.

Jumping to gross margin and EBITDA. We reaffirmed our target between 30% and in the range of $5.70 to five ninety. You know, I would just tell you that as we set up for the year, we have made a ton of progress. We don’t almost take it granted internally on the on the gross margin side of the house. If you look at it a couple of years ago, we were in the low to mid mid 20, and and a lot of that was COVID COVID driven.

We had significant peaks and valleys in our sales volume that caused quite a few fluctuations in our gross margin, and now we’re on the road to recovery. If you look at pre COVID, stocks have been a mid 30% gross margin company. Now to talk to Jim Hagedorn, our CEO, he’ll push us to high 30. You know, do I see a path to that? Potentially.

But we gotta keep being diligent. We’ve gotta focus on the things we do best. They had applied earlier that’s up to get cost out. This fiscal year, so just to get everyone grounded, this year, we’re expecting 30% gross margin, just over 370 basis points of improvement versus prior year. About 210 of it is coming from cost savings from a supply chain perspective or about 75,000,000.

About one third of that is commodities driven, a few thirds is is cost out. And it can come from a range of things, automating the packaging line, renegotiating prices with vendors, changing formulas, all those things. We have a history of consistently doing that. A 30% gross margin this year, And if you talk through the first half of our fiscal year, what we’ve reported, we are well on our way to achieving that. And in fact, I feel real confident in what we’ve been doing in that area.

So about 210 of those basic things I could talk about are tied to to that. Last year, in q four, we also did an e and o charge tied to an AeroGarden our AeroGarden business, which was is the kitchen counter light unit that grow plants. You took about a $29,000,000 inventory write off. That will be nonrepeating. That’s a that’s an upside, call it call it, eighty eighty basis points.

And then the difference really goes to a couple of things. It’s additional overperformance in the business. It’s also Hawthorne doing a lot of strong work there. We didn’t mention it here, and I’ll and I’ll cover it at the very end around basically around Hawthorne, but they are making a lot strides on profitability. It’s a lot smaller segment, very much like our other segment now.

EBITDA. So we at the beginning of the year, the past couple of years, we’ve given an EBITDA metric. I have we have in the press release introduced ETF back into the cold again, which is traditionally what we used to do pre COVID. But EBITDA, 570 or 590,000,000, if you look at it historically, pre COVID, we’re we’re back to those levels, and we see strong line of sight to to growing that even further for next year. The the way we grow that in our gross margin, which is mid 30 for the next two years of ’26 and ’27.

Jim spoke on the past couple earnings calls, and and I have as well about obtaining about a hundred and 50,000,000 of supply chain cost out over three years. Seventy five million this year and then another 75,000,000 the next two years. And, again, 75,000,000 over two years, it should be probably evenly evenly distributed. But it’s around, what, 38,000,000 a year. It is something we can consistently do, and we have a history of.

The team has already been working on it. We’ve already been planning for next year, and I I’m seeing great progress in that area. So I’m excited about next year and and the path forward on achieving the the second phase of the 75,000,000 of cost out. Other things. Let’s see.

Anything else on you, though?

Nate Baxter, Chief Operating Officer, Scott: I don’t think so. Let me go ahead.

Operator: Alright. So ETFs. We’ve we’ve we’ve introduced ETFs. We’ve put in here a minimum of $33 and 50¢ a share. If look at it, past couple of years, we’ve made outstanding progress.

You know, part of that is is tied to the EBITDA improvement I just spoke to, this margin I spoke to, which are driving a lot of that EPS growth. The other piece of it is also below the operating line, and this is where we’ve done a lot of hard work with the team on cash flow, debt repayment, and and eventually then driving interest expense savings. So that is driving a lot of that improvement below the line. For the this year, we do expect cash flows to be about $2.50, 2 hundred 50 million dollars. And if you look at it probably pre COVID, that that number was around, call it, on average, about 200 to 210.

We have started to take a step change up with free cash flow as we look to look for this year and beyond. Some of the growth initiatives that Nate spoke to as he was going through the presentation, they don’t require massive working capital. They required just normal capital CapEx expenditures that we can fill within our within our normal run rate, which CapEx in general is around, call it, two and a half to 3% of net sales on an annual basis of cap. And, again, a lot of it’s focused on our factories, supply chain. But I would say some of the newer investments we’re making in CapEx are tied to to to data, to IT, and a lot of those insights that that you spoke to, automating things through that.

A lot more good work can happen. We feel like we can consistently deliver it. And, I go back to Scott. He’s been around for many years. He’s a consistent, stable company.

He can deliver consistent, stable cash flow as we look through this year and beyond. The last couple of years, I’ll only highlight, were pandemic driven, so we did get a lot of free cash flow from inventory pull through. I would just tell you that our inventory levels are are very good as we head into the balance of the year, and we could foresee our inventory levels to be solid around $10,500,000,000 at the at the end of the the fiscal year. Our our what we hold on our balance sheet. So I think the thing I’m more excited about, as Nate spoke to, is how do we how do we maybe improve cash flow during the during the fiscal year and not have such a significant ramp up in our inventory

You can produce inventory at different times. You can get your retail partners to to take that over that time period. So we’re working on that, and and we’re excited about it. Alright. Long term.

I’ve got this chart in here that’s talking about the four, well, four key goals, and that’s delivering sustainable net sales growth. Again, I just showed you that history. You know, we we’ve shown that we have the ability to hit 3% annual sales growth. And that comes with some pretty solid high margin products. You know, we’re not we’re not just driving low margin 20% below our our our countrywide gross margin SKU.

This is high margin activity. And the things that we’re doing from a growth, both in the lawn space and frequency, our soils products for high margin and doing the stuff with Martha Stewart there, they all deliver really strong margin. So we have a history of delivering 3% annual growth as you saw on the chart earlier. It comes through innovation. It comes through new platforms.

And, again, I’m excited about ecommerce. We’re growing double digits in ecommerce. This year, we’re we’re growing double digits. So it keeps it keeps it keeps growing. And the reason we’re able to do that, again, is high paying.

We can get you the product in season when you need it the most. That’s super important. They’re the lowest cost manufacturer. So this is tied to sales at the end of the day in my mind. We, you we have had a lot of listings.

We are the national lawn and garden player, Growing media what I didn’t tell you, and you you may have seen them prior slides, but Growing Media has about 40 sites around the country where we produce soils, mulch. That is a a strategic competitive advantage. We’re able to get products quickly across the country. And then get and then, ultimately, then that that that allows us to then ultimately get

Nate Baxter, Chief Operating Officer, Scott: our margins back up to what you’ve historically seen.

Operator: And then I think and, again, for me, as I look out, I think we can achieve above 35%. And and the grow and the and the way you get there, again, high trend savings, pricing because we are an innovative company. We offer multitude of products across the category, and then we can grow our sales. And all three

Nate Baxter, Chief Operating Officer, Scott: of those things can provide you gross margin. And I’ll

Operator: just wrap up and talk about briefly the balance of the balance sheet and capital allocation. If you look at this pre COVID, traditionally, you know, we we give our quarterly dividend. We give a share buyback or share repurchase. Those are some of the consistent things that we’ll ultimately get back to once our leverage gets to three and a half times and below. We can easily do that, we feel like, over the next few years, and then hopefully introduce something like a buyback to you all in about a year or two.

So with that, I’ll I’ll pause, and we can start to q and

Nate Baxter, Chief Operating Officer, Scott: a. Yeah. Alright.

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