The Goodyear Tire & Rubber Company Price & Performance (GT)

Our commitment to continued progress is clear. Throughout the entire company. We will continue to drive execution to unlock Goodyear's full potential as we move forward. Addition to our progress on earnings, we have also completed the divestiture of our OTR the off the road business and announced an agreement as well to sell the Dunlop brand Both. Part of our strategic review process. It's a clear demonstration that we're focused on delivering the plan and positioning the company for future growth. As with all transformation, it hasn't come without some challenges. As we look at the top line this past year, we've seen growth in the low end imports, impacting the consumer replacement industry in The U. S. Europe, as well Brazil. The inflows at the low end of the market over the last two years are unprecedented. Looking to The U. S. Market, low cost imported tires are largely sourced from Southeast Asia. Including from a number of countries that are either not subject to anti dumping or countervailing duty tariffs or whether the production has been shifted to avoid the level of tariffs that The U. S. Has sought to impose in order to counteract unfair foreign subsidies in our industry.

It remains to be seen how the tariffs in our markets will evolve this year in 2025. The Tier one tire manufacturer including Goodyear, source our volumes from factories located in all three U. S. M6 countries to support both the OE as well as the replacement customers in The U. S. As you would all expect, we have been quite active in our emphasizing the significance of Goodyear having the largest manufacturing footprint in The U. S. As well as the quality, the safety and the technology that we bring to consumers with our products right here in The U. S. The. We look forward to continuing our collaborations with the leaders in Washington as we work to address these critical issues impacting our business. In the meantime, we're working across our operations to mitigate any potential near term impacts of tariffs related to our Canadian and Mexican supply. As the tariff situation may be fluid and will be fluid, we'll remain agile and execute efficiency. We will also remain steadfast on our execution of the good year forward. Which will bolster our top line and our cost performance with benefits of US750 million dollars planned in 2025. This is continuing on the foundation that we executed in 2024 and will allow us to continue to push forward on several fronts this year.

We're going to take advantage of the strategic moves we made in 2024 to advance new products, modernize our manufacturing footprint enhance our sales effectiveness and evolve our regional operational models. In The U. S, we will accelerate the introduction of new products to more effectively compete in the premium tiers and capitalize on blank space opportunities. In our last conference call, I while also increasing our coverage to a much broader spectrum of high end high margin SKUs. We will introduce five new product lines in The U. S. This year each with significant improvements in the large rim SKU coverage than the predecessor lines. On the manufacturing side, we're increasing our capabilities in our Oklahoma facility with a modernization project that will add about 10,000,000 units of new capacity for premium tires in 2025 and 2026. We will [indiscernible] and we're running the products that will yield the highest opportunities for profitability this year. As we look to our new portfolio in the market, we're also investing in our sales capabilities, both in strengthening our customer service through global digital platforms as well as strengthening our overall value proposition for our customers, all with a clear objective to grow with the products our customers On the cost side, we're lowering our SG and A or SAG and optimizing our manufacturing assets as we look at both footprint as well as plant optimization.

In early January, we announced the addition of Don Metz as our SVP of Global Manufacturing and Supply Chain reporting directly to me. Don brings more than thirty years of experience in developing, transforming and leading complex multi site, world class manufacturing operations, he'll be instrumental in taking our global manufacturing capabilities to the next level. We have a significant opportunity as we look to drive both higher output and lower cost. In addition, Alon Konan has joined our organization from our European manufacturing operation Alon has many years with the company and a demonstrated strength in leading manufacturing Alain is now leading our manufacturing in The Americas. Don Metzler is one of six leaders I've added to The leadership crucial to our business transformation and creating a culture of high performance in the company. In addition, with the right leadership in place, we will capitalize on opportunities to streamline our operating model and address duplication of effort, and excess costs that are inherently incur under our current centralized structure model. Today, we operate from within three regions, meaning each region manages their own product portfolio, their product development, sourcing and manufacturing. By aligning our structure and process globally, we will be able to innovate and operate with speed, around the world, leveraging the benefits of standardization optimization and our key assets, meaning our people, around the world.

This new structure will translate to better products, lower costs, better service and quicker refreshing of our products across the world. The transition will take some time, but the model is one that many companies are already leveraging and will shape the future of Goodyear as well. Looking ahead, we will continue to prioritize Goodyear forward and advanced several strategic initiatives to ensure we're positioned for long term growth for our shareholders. We successfully navigated a very challenging landscape and execution will continue to support us as we work further strengthen our financial our operational foundation in the coming years. I'll turn it over to Christina and she'll take you through the financials and we'll move on to the Q and A. Thank you.

Thank you, Mark. 2024 was an important year for us we've executed on our transformation plan while continuing to build our savings pipeline for We feel very good about where we stand with respect to our targets as we look at both the goal to attain 10% SOI margin in the fourth quarter and net leverage of two to 2.5 times by the end of the year. I'll begin the year end review with the income statement on Slide eight. Fourth quarter sales totaled 4,900,000,000.0 down 3% from last year driven by lower volume. Unit volume was 4% lower versus last year in line with our expectations given growth in low end imports in The U. S. SAG declined $77,000,000 driven by Goodyear Forward work streams. As a percent of sales, SAG declined one full point versus last year. Segment operating income for the quarter was $385,000,000 and as increased to 7.8% After adjusting for significant items, including the final settlement of an insurance claim related to storm damage we incurred in 2023, our earnings per share were $0.39 Excluding insurance proceeds, SOI margin was 6.7%. Turning to the segment operating income walk on Slide nine. Lower tire unit volume and factory utilization were a headwind of $1,000,000 in the quarter.

Net pricemix versus raw materials was unfavorable during the quarter driven by increases in our raw material costs. Pricemix was unfavorable $36,000,000 Now pricing was stable, but mix was negative. Given declines in commercial replacement volume and an increase in our consumer OE volume. Continued strong execution on Goodyear Forward contributed $195,000,000 against inflation that was $50,000,000 in the quarter. And as I referenced earlier, we collected $52,000,000 of insurance proceeds in the final settlement related to our 2023 tornado claim. Other SOI was favorable $41,000,000 driven by lower incentive compensation, the recovery from last year's fire at our factory in Poland and higher earnings in other tire related businesses. Turning to the cash flow and balance sheet on Slide 10. Free cash flow exceeded $1,000,000,000 in the quarter driven by strong working capital in As we shared in an earlier press release, we finalized the sale of OTR on February 3 The. [indiscernible] Pro form a for that transaction, year end net debt was $6,100,000,000 dollars down nearly a full turn from year end 2023.

We intend to repay the $500,000,000 principal outstanding on our 9.5% notes later this month and the remaining proceeds from the sale will reduce our variable rate debt. Together, these actions should generate $70,000,000 in annual interest expense savings. Finally, earlier in January, we announced a definitive agreement to sell the Dunlop brand to SRI. That transaction is expected to close mid year and the related upfront proceeds of about $700,000,000 will be used to further reduce our leverage in 2025. [indiscernible] The strategic review of our Chemicals business remains in process. Moving to our SBU results and starting on Slide 13. Americas unit volume decreased about 1,000,000 units driven by consumer replacement. As we look at the industry, U. S. Consumer replacement industry declined about 2% Low end imports outperformed the industry and grew 11%, rising to an all time high as a result of channel stocking and pre buy activity related to potential tariffs. On the other hand, our U. S. Consumer OE volume grew approximately 20% driven by new fitment wins and the recovery from last year's UAW strike. Resulting in year over year share gains of approximately four points. Commercial OE and replacement volume declined following industry weakness.

Segment operating income for The Americas totaled $262,000,000 or 9.1% of sales. Americas earnings reflect unfavorable net price mix versus raw material costs and lower volume, partly offset by Goodyear Forward Benefits and insurance proceeds. Moving to Slide 14, EMEA's fourth quarter unit volume increased 2%. Our volume reflects growth in the consumer replacement market, driven by a strong winter tire selling season. The robust market was in part due to new regulations in Germany that require three Peak Mountain snowflake labeling. On both winter and all season tires. Our OE volume was about flat in consumer but was down about 10% in commercial, given industry weakness. Statement operating income was $41,000,000 Goodyear Forward benefits more than offset net price mix versus raw material cost headwinds and general inflation. Turning to Asia Pacific on Slide 15. Fourth quarter unit volume decreased 9% driven by actions to reduce lower margin business in key markets and channel destocking in China. Segment operating income totaled $82,000,000 and 13.5% of sales, an increase of $14,000,000 compared to last Turning to our outlook, we expect that our first half SOI will decline based on prudent assumptions around our volume. Carryover effects of production cuts in the fourth quarter and significant increases in our raw material costs.

In the second half, we expect modest volume growth and price mix to more than offset raw material inflation. Which when combined with Goodyear Forward Benefits should support earnings and margin growth particularly in the fourth quarter. In addition, we expect consulting fees and other costs related to Goodyear Forward to decline by about $80,000,000 versus last year. As we look at risks to our 2025 plan, a further step up in raw materials later this year could limit our earnings growth in the second half as it typically takes us time to offset increased in our raw material costs with price and mix. Similarly, potential tariff impacts related to Canada and Mexico are difficult to predict including both primary and secondary effects. In any case, we'll manage near term volatility with the benefit of the stronger cost base we've gained under Goodyear Forward. Sources of upside to our plan include growth in volume and price mix related to the potential for U. S. Tariffs impacting countries outside of those currently contemplated. Similarly, we also anticipate that the European Commission may make a tariff determination as to unfair competition related to consumer tire imports in the coming months. Finally, we could see raw material prices decline if pre buy and channel stocking of low cost inventory abates.

As we look at the outlook driver specific to the first quarter, we expect global unit volumes to decline channel inventories in The U. S, and consumer OE declines as a result of lower OE production. In addition, we expect higher unabsorbed fixed costs of about $25,000,000 driven by lower production, during the fourth quarter. Price mix is expected to be a tailwind of about $65,000,000 driven by pricing actions we have implemented and raw material index contracts with OE and fleet customers. Raw materials will increase approximately $175,000,000 driven by natural and synthetic rubber price increases. At current spot rates, we would expect to see raw material total in the first half of twenty twenty five, with about $50,000,000 of that driven by transactional currency impacts. Goodyear Forward will drive approximately $200,000,000 of benefits, reflecting continued progress across all works Inflation and other costs are expected to be a headwind of approximately $75,000,000 reflecting increases in transportation rates over and above core inflation. Foreign exchange will be a headwind of $15,000,000 and the non repeat of costs related to the fire in our DnBisa, Poland facility last year will be an $11,000,000 benefit. Also for modeling adjustments related to the OTR transaction.

Our full year 2024 OTR revenue about $600,000,000 and SOI was 65,000,000 Depreciation and amortization was $18,000,000 We expect the transaction to reduce 2025 SOI by approximately $80,000,000 inclusive of stranded costs primarily in Asia. Other financial assumptions on Slide 1818 have been updated to reflect our expectations for 2025. Interest expense will be approximately $60,000,000 lower than last year driven by debt reduction. Higher restructurings reflects footprint actions announced under Goodyear Forward Including A Recently Announced Plan In Our Danville, Virginia facility. With major cost programs announced in three of our factories this year, we expect to incur some transitory manufacturing costs approximately $30,000,000 in the second half of the year. With inflows in working capital and lower CapEx spend relative to 2024, we expect to generate positive free cash flow in 2025, consistent with our deleveraging objectives. With that, we'll open the line for your questions. Thank you very much. We'll take our first question from James Picariello with BNP Paribas. Please go ahead.

Hi, everybody. My first question is just on your pricemix expectation for the The. I know it's harder to call the farther out, but can you just confirm what the expectation is for the first The, if you already provided that?

And then thoughts on the second The, raw materials, should we assume neutral or an additional headwind potential based on spot pricing? And have you seen any pricing actions from your peers thus far given the rather substantial raw material headwinds that the industry is facing? Thanks.

Yes, sure. James, I'll start and I'll have Mark follow-up on the pricing environment. When we look at our SOI bridge for 2025, pricemix should grow from the first quarter on into the second and third quarter. A part of that is the realization of our OE RMIs and our raw material index contracts with our fleets. Those generally were priced on a six month in six month arrears. And so we don't have nearly the full run rate here in Q1. There's also been pricing actions that we've taken in our key markets around the world. In the first quarter as well. And I'll let Mark follow-up on that. When we look at the raw materials, what I would say is the $350,000,000 is baked based on current spot rates for the first half.

If spot rates hold, we could see a headwind of about $100,000,000 to 150,000,000 in the back half of the year. Of course, raw spot prices have been pretty volatile, so we'll continue to update you on that But again, looking for pricemix to grow into Q2 and Q3, before leveling off or just depending on what happens the rest of the year with raw. [indiscernible] Yes, James. Yes, just talking through some of our pricing actions that we've already happened as Christina mentioned, right. Since the third quarter, call, pricing actions we've taken. We've done multiple rounds of pricing globally. Commercial tires in Turkey, for example, across the Latin American countries. As well as consumer pricing in Europe, as well as Middle East.

And then across The U. S. On specific product line, we've taken product actions in both quarter four as well as rolling into quarter one. So we'd expect to see see the benefit of that going into the quarter '2 time period.

As that flows through the system. We continue to watch things to make sure that we are competitively priced based on our upgraded marketing intelligence. As we mentioned, it's a big area we focused on in 2024. Was our scraping and making sure that that we're benchmarking, that we're in the right price position across each of the categories and really taking a look at that from a consumer facing thing so that we are competitive in the market Got it. That's helpful. And then I just have a quick two part question. One on volume. You have the full year industry volume assumption consumer flat, commercial up 3% at the mid point, again at the industry level. Just your thoughts on Goodyear's volume performance for the year, we could see the down 2% to 3% for the first quarter. Just curious what The expectation is for the second half? On easier comps, is there a good pathway for likely growth given channel inventory levels at this point? And then just The in your Goodyear forward savings in the fourth quarter, there was obvious upside. So just had a question on what drove that upside? It seems like it might have been in the margin expansion effort.

Is that just your pricing actions? [indiscernible] talk about volumes to start and then we can talk about Goodyear Forward with Christina. Again, as you mentioned in the consumer replacement side, we expect overall global growth in '25 with a stronger marketplace in Europe and Asia and continued to see expect to see volatility in The U. S. Market relative to the imports In the South America or Latin American countries in Brazil, we expect to see some declines in the imports as new tariffs have gone into impact The. Starting in October. The the consumer OE, we think there will be a flattish first half. We with growth on the second The end, as you mentioned, on The U. S. Side.

As we look at commercial, from a replacement demand we think that's going to stabilize progressing throughout the year. With non imports declining at the tariffs that were recently announced begin to take impact, especially those coming out of Thailand. And then so overall commercial OE side, first half, I think, will be relatively soft, continuing on from last year. And then second half being stronger with the new GHG regs going into place and the fleets beginning their pre buy activities be before those new regulations go into place. And then then your second question and secondary part of that, how are we going to address those lower volumes? So we're doing that on multi fronts. As we shared in quarter three, we are aggressively growing. This was an area that we were behind on. We took a step back. We reorganized our self in terms of our engineering teams, our go to market teams and have dedicated focus on bringing 100 and somewhat nearly 200 additional SKUs into the marketplace in the high end, highly profitable segments of the market that are going to generate the returns and greater value for us and also at a premium price.

So that's a key area of focus for us. We've got five new power lines coming in to the marketplace around the world, our WeatherReady 2s, our Wrangler workhorses, the ASEM-6s we discussed The are the really on the premium side of our high high value UHP market the Eagle F1 all season as well in the high segments and Max Life two, right, all of which are are coming into the marketplace throughout this year, which again is why we feel feel good towards that second half as these all are coming into the market place at volume and the right number of SKUs in each of those power lines, James.

And James, just to follow-up your question The. I mean, there's a lot of time Mark just spent on price mix actions and a lot of that started in Q3 last year. And so you're seeing that in the Goodyear Forward program. Especially in the premium end of the market.

Appreciate it. Thanks guys.

We'll take our next question from Thank you. I was hoping to actually follow-up on the same topics, which is volume pricemix outlook. First half versus second half. So it seems the outlook contemplates decline in in SOI at least in the first The, but then [indiscernible] in the second half. Can you just maybe just go back over for both volume, price and mix What will be the anticipated drivers of improvement in the second half? And I guess how much visibility and conviction do you have on this at this point? Sure. Hi. Good morning, Emmanuel. I'll start out with the SOI bridge for 2025.

If you look at the puts and takes as we've talked about them, our 2024 SOI was about 1,300,000,000.0 we adjust that for insurance proceeds, we are at 1.2 Now Goodyear Forward, of course, going to add $750,000,000 for us against a base inflation of $225,000,000 We said we're also going to have headwinds in The costs outside of core inflation and that's mostly driven by transportation. That's going to run $20,000,000 a quarter. We also have three factories that we are ramping down or decreasing production in The third fourth quarter of this year. So that will increase our manufacturing cost through some transitory inefficiencies in the third and fourth quarter by about $30,000,000 We've talked a lot about raw material headwinds. About $350,000,000 in the first half, about 100 maybe up to $150,000,000 at current spot prices in the second half. And then spent a lot of time already on the call about how we're thinking around price mix. We've given you the first quarter, but that should grow pretty materially. In Q2 and Q3. And get to a run rate by Q4 and that's driven by pricing actions that we've implemented in the first quarter The. We pricing through our OE RMI index agreements, fleets as well.

And then obviously, Mark just spent a lot of time on the new product development, new product lines we're bringing into the market, which should also support our mix. OTR should be a headwind. We've outlined that in the presentation dollars 80,000,000 on a full year basis and then it does come down to volume.

What we've laid out is Lower first half driven mostly by The U. S. Channel stocking of low end imports. And lower OE volumes just following OEM production broadly. And then moderate growth in the second half for us driven by very low comps and a recovering industry broadly in commercial and in consumer OE. And so once you put all of that together, I think it's safe to say you should be able to model a level of SOI that's in line with our current year. Including the insurance, which means that we should be demonstrating a very strong level of underlying growth in the business, something on the order of 10%.

That is super helpful.

Thank you so much. And then just so in line with currently, I mean, in line with 2024.

In 2025 would be in line with '24 including the proceeds you got last year? Yes.

So like the 1320 The.

Got it. Yes. So that's was our understanding as well. Perfect. And then if you could just help us out with the the free cash flow walk as well. And then you called for positive free cash flow I assume that this is before restructuring. How should we think about restructuring, which I think you qualified for this year, but also how much more is there to spend as part of the overall plan?

Yes, sure. So the positive free cash flow $400,000,000 of restructuring. So we intend to be positive including restructuring. The is really driven by that SOI we just talked about and you should get to an EBITDA call it about $2,100,000,000 after you go through the model that we just talked through on SOI. Working capital will be a benefit. We've laid that out. We're structurally Restructuring, of course, against that taxes, a couple of hundred million dollars $400,000,000 in restructuring, sorry, And then interest expense is coming down on a year over year basis Interest income will offset that. We'll have our normal financing fees and then CapEx significantly lower than 2025 and all of that should get you you to a fairly positive free cash flow expectation for 2025. And then as you think through to next year, should see restructurings normalize I'm restructurings next year will be on the order of $100,000,000 to $200,000,000 We'll see further interest expense savings once we close on the Dunlap transaction and finalize the strategic review of chemicals. We would be in a position next year to drive cash flows significant positive cash flow reflective of the underlying earnings run rate of the business.

Great. That's super helpful. Just final point, is it is the overall spending on restructuring lower than in initially anticipated?

Maybe just my memory doesn't serve me right, but it sounded to me that the total budget could have been sort of like north of $1,000,000,000 Now we're talking about just $400,000,000 this year and maybe $100,000,000 to 200 next year. So is it just an overall lower build than expected?

I think, yes. Emmanuel, we had set aside about $1,000,000,000 as part of Goodyear Forward for restructuring and as I've just laid it out, we spent 200 in 2024 The capital that we're going to allocate in 2025 is about 400 and then up to 200 next year. So we're we're probably going to land right around $800,000,000 or so as part of the overall program. I think some of that is terrific negotiations with our constituents around the world. I think a part of that also is just the execution that we've seen in what Mark's describing about generating efficiencies in the factories to increase our volumes. And so no other announcements planned nothing else in the pipeline. If anything changes, we'll keep you updated.

Great. Thank you so much.

Thank you. And our next question comes from Doug Carson with Bank of Great. Thanks so much for the detail on the slide deck.

I want to maybe just turn good morning.

I want to maybe turn to the balance sheet for a moment here.

Net leverage now as it's three times almost a turn below what you had last year. So The the forward program is certainly working. And I've just kind of pulled up your ratings at B1 and B plus seem pretty underrated relative to the progress you've made on the balance sheet. Have you had a chance to to kind of refresh with the rating agencies to have them take a kind of newer look at where the balance sheet is headed That's my first question.

Yes. Thanks Doug for the question. And certainly making a lot of progress on the balance sheet. We intend to close on the Dunlop transaction a little later this year and that will bring in $700,000,000 more of gross proceeds that we intend to use to deleverage even further. We do talk to each one of the rating agencies very regularly. Last night in fact was the most recent conversation. And I think they do Look at our forward forecast, I think there was a lot of emphasis placed on our 2024 free cash flow, which you can see was slightly negative because of a lot of the restructuring programs that we had in place. And so I think as we look ahead, we would expect more positive outlook and sentiment from the rating agencies just given the progress so far.

That's great. Well deserved.

I was impressed to The close to 50% increase in the Goodyear Forward cost savings up to $750,000,000 in as I look at the environment we're in, there's so much volatility between tariffs and raw material fluctuations You maybe just help us think about some of those big line items you have $300,000,000 for footprint optimization and and $200,000,000 for purchasing. Are some of these categories less at risk, more at risk given the environment, just trying to be thoughtful about the seven fifty?

Yes. We Doug, we feel really really positive about the look ahead, right? We executed very strongly in 'twenty four. We were able to put additional projects and they're grassroots projects, right, as well. So if really good. It's coming from our associates from around the The. We've got our dedicated weekly session as part of governance across the five key work streams.

And as I mentioned The the start of the call, we've now combined our manufacturing organization into one global organization with our three regional heads reporting to Don Messer, our new VP there.

With a very strong thirty year track record. I spent a lot of time in the space myself last year with the teams as we went through just again working on the nuts and bolts of manufacturing basics, right, of us really working on on our efficiencies, our operating equipment effectiveness, our scrap rates, getting through the material flows and really upgrading things in terms of just the diligence and the few KPIs that make the most difference in terms of us really getting ourselves to a super strong position there. So we feel very good about our plant optimization We announced the the footprint actions both last year as well as at the start of this year. In our commercial truck operation to to be in a position where we can compete in the marketplace there at the right cost structure and we continue to drive those work streams. In the purchasing side, we're continuing to go through on looking at our cost in the purchasing arena.

Working with our supply base, both on current programs as well as future [indiscernible] And a strong drive and efficiency improvement in our indirect and MRO activity. [indiscernible] again in that area very strong. We've taken actions throughout last year as well as early this year and our SAG or SG and A, however you want to refer to that as of making sure that our overhead structure is in the right condition there and continue to look at that on a monthly basis as we take a look to say what are things that we can do more efficiently than we've been doing it. So standards, looking at how we spend, how we negotiate, and long story short of it, we feel very very strong that that the improved savings rate are going to continue. And it's just really gotten to a point that is embedded in our DNA.

Great, Mark. Thank you very much for taking my questions and it was very helpful.

Thank you. Go next to Edison Yu with Deutsche Bank. Please go ahead.

Hey, good morning. Thanks for taking our questions. Want to ask about the on the chemical side. I know you said you're still on track for a sale. Has the reception been a bit more muted We speak to some chemical companies and obviously there's some challenges just for the industry there. What is your latest thoughts on On The, Edison, we don't have a lot more to say other than that review remains in process. I think that generally speaking, I think the interest has been pretty across all sectors, whether you think about strategics or private equity. This one in fact was when we got in the market a little bit later. Of course, the focus on OTR and Dunlop in the earlier part of 2024.

Thank you.

Understood. And then just a quick one on the SOI in APAC and I apologize I missed it. Earlier. It was actually very strong margin Was there anything kind of one offs there some sort of kind of benefit that doesn't carry over? Just wanted to double check on that.

No, we've got we just have a really strong operation in AP. They're Their manufacturing prowess is very strong. Pricing in the marketplace, very good. New fresh products going in, winning with the right with the right winners in the marketplace, particularly on excuse me, on the EV front there. And just really operations doing quite well in AP.

Got it. Actually just one quick one The quick one. I know you know I heard earlier about the expansion in Oklahoma. Is that Is that in any way kind of maybe mitigation in case of the tariffs?

No, we would like tell you our crystal ball was good enough to do that, Doug, but that was not the case, right? It's just necessary modernization that we needed to make across our footprint. And that's one of our larger facilities or one of the largest actually. And we just were taking all the right actions we needed to take there in terms of moving more into the higher rim sizes, additional volume for the marketplace. In that higher profit, higher margin segments.

Great.

Thank you very much.

Thank you. And we have no further questions. I'd like to turn the call back over to for any final or closing remarks.

Okay. So I'd like to thank you all for taking the time to join us today for the fourth quarter earnings call. We've come a long way here over the last year and still have a lot on our plate to action, but feel very good we've got the right leadership team. Got all the right associates around the world. And we want to we're really looking forward to sharing with you all the progress we make our good year forward initiatives as we move throughout this year. Thank you all for joining us today and everybody have a great day.

Thank you. And that does conclude today's conference. We appreciate your participation. You may disconnect at any time.