I would now like to turn the conference over to Mr. Peter Loimaranta, Managing Director and CEO. Please go ahead.
Excellent. Thank you. Welcome, everyone, and thank you for taking the time to dial into our results presentation. If we just kick through, I'll just give a little bit of an overview on our business for those that might be joining the call for the first time. MaxiPARTS operates two operating divisions: the traditional MaxiPARTS business, which is a commercial truck and trailer spare parts business, and Förch Australia , which is a workshop consumable business that we purchased in May 2023.
Just briefly touching on the MaxiPARTS slide, MaxiPARTS is one of the leading distributors of both genuine and aftermarket parts for commercial vehicles in Australia. We have 29 branches operating around Australia with then a number of on-site customer-embedded operations. We also have one of the largest dedicated driveline rebuilding workshops in Western Australia.
We have our own product brands in terms of Maxus and Exxel, as well as partner with a number of industry-leading brands such as Castrol or Cummins as we move forward. Quickly touching on the Förch background, as I said, Förch was a business we acquired in May 2023. It's a business that specializes in workshop consumables and offers us the ability to generate returns at a higher rate than the traditional MaxiPARTS business.
When we bought it, it was predominantly a Western Australian business with very little operations on the East Coast. Over the last 18 months, we've been expanding those operations and successfully growing the business. We do think it is a business that allows us to continue to deliver higher than traditional growth rates, and those growth rates will come in at higher than traditional EBITDA and profit margins to drive an overall improvement in the group's profitability metrics.
That business also has its three main warehouses in Melbourne, Perth, and Brisbane, which we believe is that long-term ideal distribution network with an expanding infield sales team to drive that business forward. If I then jump to the FY2025 highlights page and our progress so far in this financial year, as most people know, we have had an ongoing legal dispute in relation to the sale of the trailer solutions business that we completed in September 2021.
Pleasingly, that dispute got resolved at the end of this half, and that resulted in a positive cash inflow as a result of the settlement, elimination of distraction and management time, and certainly elimination of any ongoing legal cost or litigation risk. The items on the right-hand slide were the items that we outlined in our outlook statement at the full-year presentation where we said we are operating in a difficult market, but our focus was going to be on improving revenue and margin improvement.
As you'll see as we move forward, that's certainly something that we've achieved. We want to drive balance sheet flexibility. Once again, you'll see in the detailed presentation, strong cash flow, reduction in debt driving, and improved balance sheet flexibility as we're going forward. We do have some system integration work linking into previous acquisitions of the Independent Parts business.
That has got an in-progress sign. It is progressing well in line with what we expected, and it is only the ERP system integration work that is left. The rest of those business integration activities are all fully complete. The last one, as we talked about previously, is the opportunity with Force. We have targeted a higher growth out of that business, and certainly the half-year results demonstrate the importance and our ability to scale up that business as we move forward.
If we jump to the next slide, that leads us into some of the key financial metrics, which I will touch on before Liz jumps into some of the more details around our P&L balance sheet and cash flow. I guess these results we are very pleased with. They've been driven by a combination of strong continued organic growth programs coupled with well-executed strategic acquisitions that have allowed us to improve all of our key operating metrics and financial metrics in this financial year in what is still a very difficult market.
Top-line revenue growth of 22.6% year on year. I guess what is more pleasing to us is that revenue growth has then been coupled with margin improvement, whether it be at the EBITDA level, the net profit level. Our EBITDA margins hit the 10% mark, which is what is a metric that we were looking to target early. Likewise, strong cash flow generation allowed us to further reduce our debt into a very conservative leverage position.
We did see some natural increases as a result of the profit improvement and improvements in earnings per share of 36.3% and a lift in the interim dividend to AUD 0.035, which is an 18.7% increase on the previous half. If we then jump to the next slide, it's just, I guess, important to recognize we have been doing this over a number of periods now. We have got consistent growth at the revenue line.
We have got consistent improvement in our EBITDA results as well as our EBITDA margins. We have done that with a significant change in our revenue distribution model linking back to when we sold the business. When we sold the trailer business in September 2021, we had a large exposure to a revenue stream that was linked back into that business.
That has now been, in effect, completely removed from the business. B ut we've substituted it with traditional higher margin business, which has been driving those improvements over time. With that, I'll hand over to Liz to talk through a bit more detail about the financial results.
Excellent. Thanks, Peter. Hello, everyone. Pleased to take you through the HY25 financial results today, which hopefully you'll agree is a nice, clean set of results for the period. Just starting on the slide titled HY25 Financials, revenue for the period of AUD 136.9 million was up 22.6% over the prior period. EBITDA was AUD 13.7 million, was up 28.6%, and as Pete called out in the highlights, EBITDA percentage of 10% was a key metric that we've been targeting for the last few reporting periods.
Very pleasing to get there and see a 40 basis point increase over the prior period. We have provided further information on the MaxiPARTS operations and Force Australia revenue and EBITDA results and highlights, which Pete will take you through shortly and will give you a little bit more flavor as to the product mix that's helped contributed to the margin improvement that we're seeing.
Moving to the net profit before tax and amortization line items, profit of AUD 6.8 million, up 29.2%. We have included the details that make up the depreciation and interest line items there for those interested in the breakout of those numbers. Net profit after tax for continued operations of AUD 4.3 million was up from AUD 2.8 million for the same half last year, and a reportable profit for the period of AUD 3.8 million was up over AUD 0.4 million.
That encompasses the discontinued operations results, which we've got full disclosures in the financial statements on the makeup of those numbers. When we look at the next slide, being the balance sheet slide, the first item to call out, net working capital of AUD 68.3 million, which consists of the inventory receivables and payables balances, is consistent period to period with seasonal increase in inventory offset by a reduction in receivables.
Just called out the financial assets. Prior periods have had a AUD 3.2 million balance relating to the outstanding receivable that's now being dealt with the settlement deeds with Freighter Group . As we've previously announced at the end of last year, we received AUD 2.2 million of funds, which you'll see in the cash flow, and the remaining balance of that receivable was impaired to discontinued operations, but also offset with the balances of provisions for unused customer warranty and other provisions. Draw your attention to the deferred tax asset for the group of AUD 11.1 million. That includes AUD 10.1 million of the income tax losses carried forward for future use. The final item to call out on the balance sheet is the financial liability of AUD 1.2 million for the estimated purchase price of the remaining 20% ownership stake in Förch Australia
The purchase of that stake is governed by the put and call option that can be exercised by either party within the two- to five-year window from acquisition date. Moving on to the cash flow side, gross operating cash flow of AUD 12 million for the period. That resulted in a cash conversion rate of 88% for the half, very comparable to the second half of FY2024 at 90%. A very pleasing result. The first half of FY2024 had a conversion rate of 45%, which was sort of impacted by the timing of acquisitions in that half.
Again, a very pleasing result at 88% cash conversion for the half. Just call out the cash inflow on discontinued operation items that split across two line items in the cash flow. You'll see the proceeds from the legal settlement of AUD 2.2 million offset with outflows to the Queensland State Government. That was a provision that we'd held over at the end of FY2024, and the legal fees incurred throughout the period.
I'll draw your attention to the CapEx for the period of only AUD 0.4 million. Just reiterating that we are deemed to be a capital-light business. We are expecting a small uptick in the CapEx spend for the second half, just following on from Peter's comments with regards to the business system upgrades that are in progress at the moment, as well as some smallish site relocations.
The final item I'd like to call out on the cash flow is the AUD 4.5 million repayment of borrowings for the period. That consisted of us paying down AUD 1 million in line with the amortization rates of our facilities, as well as a AUD 3.5 million paydown of drawn debt through the use of our free cash flow generated for the period. We'll move to the next slide, being the capital management slide.
Again, just reiterating on our debt funding for the group, we have a total borrowing facility at the end of the half of AUD 28.5 million, which is drawn to AUD 25 million. Our current leverage ratio of 0.4 times is well within the group's capital management targets. For dividends, we've got a fully franked interim dividend at AUD 0.0305 per share declared to be paid on the 20th of March 2025.
The dividend reinvestment plan remains available, and that will be at a new discount to the market price. Post this dividend payment, we'll have franking credits of 3.9 remaining within the group. The final item to call out with regards to the Force Australia 20% minority stake is the AUD 1.2 million financial liability that we've recorded.
The exercise window of the option opens in June of this coming year, so June 2025, and it is considered likely that the option will be triggered inside the next 12 months. The purchase would be cash funded either through existing cash on hand or drawn existing borrowing facilities. On that note, I'll hand back to Peter to take you through business unit updates.
Thanks, Liz. If we jump to the MaxiPARTS slide, and we'll talk through the market highlights and focus areas, but really what we're seeing in this particular business unit is the benefits from the strategic acquisitions that we've made either through the Truckz one acquisition in 2022 or the Independent Parts acquisition in December 2023, combining with a continued focus on organic programs to offset the softer market and economy, particularly on the East Coast. In terms of market, as we've talked about, we do see quite a difference between the East Coast and West Coast of Australia at the moment, the East Coast being significantly weaker and subdued on the back of general economy impacting the freight task.
The Western Australian market, which links into the strategic acquisition of Independent Parts, has continued to remain robust and has delivered growth through the period at a higher rate than the East Coast. We are still seeing fairly competitive pricing in certain sectors, certainly some of the larger customers. That is a challenge to maintaining margins or has been a challenge to maintaining margins over the last 12 months.
In terms of highlights for MaxiPARTS business, as we did talk about, a number of the part of the revenue growth is driven by timing of the acquisitions, but if we strip all that back out and look at a real like-for-like revenue growth number for the underlying MaxiPARTS business, so underlying being excluding sales to the previously owned trailer business, including the Independent Parts sites that we picked up, we saw a 4% year-on-year growth rate through that business.
The Japanese parts program was an outcome of the Truckz one acquisition we completed in February 2022 and has been a continued focus and higher growth rate for us. It's a product range that comes through at traditionally higher profit margins than the traditional MaxiPARTS business, so it was very pleasing to see that grow above a 20% period-on-period growth rate out of that program as well. We have seen growth from the acquired Independent Parts business.
That growth has come through both the sites we acquired as well as the embedded operations. Once again, not relying on a single distribution revenue stream through there, the growth has come across both of those different distribution avenues. We have seen expansion of key customers that we picked up via the Independent Parts acquisition starting to drive benefits through the non-Independent Parts site.
The East Coast business, certainly through central Queensland and northern Queensland, and we do see further opportunity for that to continue to add value in future periods. Once again, a cycle back, pleasing to see the EBITDA margins improve despite the challenging East Coast market. In terms of focus areas for the MaxiPARTS business, we will continue to focus on growing the Japanese range at accelerated rates. We will look at network expansion, particularly in key regional sites where we think there is some growth opportunity.
We remain active in terms of our inventory and working capital management, particularly on the East Coast where we do see some subdued volumes. We do have the completion of our business system upgrade and database consolidation. To put that into perspective, we are currently in UAT testing for the upgrade of the East Coast database. It is an upgrade.
It's not a new system, and it upgrades in line with the version of our ERP system that is in place in Western Australia. It's not new. It's not unknown. It's an upgrade, and it's currently going through testing. That's expected to go live in the coming weeks. For those that remember, we did put the traditional MaxiPARTS business and the Independent Parts business onto a common ERP platform in Western Australia at the start of last calendar year as part of our acquisition. That's allowed transaction efficiency for those operating businesses in Western Australia. It's also meant that we've completed a bulk of the data analysis and integration work that is one of the key challenges in integrations of our business.
Once we get the East Coast upgraded, we will then bring the West Coast on and be on, once again, a national ERP platform for the MaxiPARTS business. Just to reiterate, all the other integration activities in relation to the Independent Parts business were completed probably about six months ago. We will continue to look at key account acquisition and management within the MaxiPARTS business.
If we then jump through to the slide on Force Australia, once again, I guess as a bit of a highlight, this particular business unit is delivering high growth rates and improved financial returns. The market that it operates in is very similar to MaxiPARTS. The West Coast is stronger than the East Coast.
Slightly different in terms of market impact, we see as being a lower impact on the Force business as a result of starting from such a smaller immature business, so therefore the ability to gain market share. It is a smaller spend per customer, so therefore slightly less price-sensitive than the traditional MaxiPARTS business. We have also seen very strong customer desire for those larger customers that are looking for a new, larger national alternatives compared to what they might have had previously in the marketplace.
Highlights for that business, similar to MaxiPARTS, we have gone and adjusted out for the impact of the Force Brisbane acquisition that was completed in December 2023, and that results in a 16% like-for-like revenue growth, half one versus the prior comparative period. We are still seeing strong multi-site customer solution implementations as well as ongoing strong leads in that particular space.
The national sales team that we invested heavily in 12 months ago is starting to mature and starting to drive revenue growth, and that revenue growth is coming through both the East and West Coast regions for the Force business. We did invest in upgrading an e-comm business to a B2C e-comm facility, which was just as much about starting to improve brand recognition for the Force business on a national basis as well as generating income, but that is a new distribution channel that we would expect to continue to grow as we move forward.
As mentioned earlier, with the increased revenue and a more consistent cost base, we are seeing that the operating leverage is starting to come through with EBITDA margins back up at 13% for the period, and once again, ahead of the traditional MaxiPARTS business, helping us drive that entry into double-digit EBITDA results for the group.
Cash flow for Force, we did invest fairly heavily in inventory when we first bought the business. The last six months, we managed to keep our inventory level stable despite the 16% growth, so that has driven a strong cash conversion out of the Force business as we move forward. Focus areas for the Force business, continuing to get efficiency and maturity out of the sales team that we invested in 12 months ago.
We do expect to maintain high growth rates, and they will come through further multi-site customer wins, existing customer sales growth and range extension, and some territory expansion as we leverage off some of the earlier larger customers that might have allowed us to enter particular markets where we haven't operated previously. We'll continue to build on the brand awareness through our digital marketing and social media strategy, and as Liz mentioned, we do expect to see the 20% minority holding acquired within the next 12 months. If we jump through to the outlook, very similar to what we communicated at the end of the last financial year in that we do see ourselves operating in a period of heightened unpredictability due to both global events and weaker domestic economy. That has seen the East Coast of Australia slow down and soften in the transport activity.
We are still seeing Western Australia operate in a strong basis. At this point in time, we expect those trends to continue through the second half of financial 2025. Likewise, we remain committed to our organic program, so we expect to continue to see revenue and margin improvement from our organic activities. We will continue to drive balance sheet flexibility to allow us to respond as well as have an active capital management plan moving forward.
We will finalize the integration work and get the systems back onto a common ERP platform, and once again, Force remains a continued area of investment and revenue and profit growth that we expect to come through for a number of different periods. We believe by doing that, similar to what we've seen in half one of this year, we'll continue to deliver strengthened financial metrics at an EBITDA and EBIT level as well as return on invested capital. With that, we will pass back to the administrator and open it up for any questions.
Thank you. If you wish to ask a question, please press star then one on your telephone and wait for your name to be announced. If you wish to cancel your request, please press star then two.
If you're on a speakerphone, please pick up the handset to ask your question. The first question comes from James Casey with Ord Minnett. Please go ahead.
Good morning. Just a couple of questions from me. Just in terms of the outlook, I guess you've come up with a fairly conservative outlook, which I guess is prudent. Just over reporting season, and in particular in recent days, I guess we've started to see some improvement from companies and some companies calling out some green shoots in Victoria. Peter, are you starting to see any of that kind of materialize, specifically on the East Coast?
Look, thanks, James. To be honest, at this time of year, the variability that comes through, holiday periods, customer closure, weather events, we certainly do not see it fundamentally declining. We probably think it is a bit too early for us to turn around and say we expect the slowdown that we saw last year to suddenly materialize, but we certainly are hopeful that the recent interest rate reductions drive some economic activity and that will ultimately flow through to transport movements and therefore spare parts businesses. We certainly think it is a timing event of when things improve. Whether that improves quickly or whether it flows in the next financial year, I think we will see over the next couple of weeks and months.
Yeah. Okay. Fair enough. Just with the Force business, you called out comp growth of 16%, which is really good growth. Just in the sort of outside of the next six months, maybe looking more to the medium term, I know you've invested heavily in sales staff, but where would you see the medium-term growth of that business kind of level out? Would it still be double-digit or would you expect it to kind of come back to single-digit type growth, maybe over the next three years, for instance?
Yeah. Look, we're certainly thinking that short to medium term it will remain in that double-digit level. If we go back to one of those original slides and I guess to put the opportunity into perspective, the Force business this year will be sitting at about AUD 20 million or just over AUD 20 million worth of revenue. Certainly, the market leader in that space is well north of AUD 175 million.
We will start to feed in some investment back into the sales team, but that investment will be a lot more staggered and traditional than what we originally did when we bought the business. We think a combination of expansion of that sales team, continued rollout of key customers, growth into regions where the business is traditionally not serviced will certainly allow us to continue to generate those sort of double-digit revenue growth rates for multiple periods to come.
Yeah. Okay. And then just finally, you did comment on the competitive pricing, which went back to your previous trading update. Is that competitive pricing issue still well and truly in the market in the second half, or is that kind of eased off now?
No, it's still in the market as we sit here today.
Yeah. Okay. Thanks, Peter.
Thanks, James.
Once again, if you wish to ask a question, please press star then one on your telephone and wait for your name to be announced. The next question comes from Jason Palmer with Taylor Collison. Please go ahead.
Yeah. Thanks. Good morning, Peter and Liz. Just going on from James's question around the challenging pricing environment. If you were to quantify what you thought that margin impact was to the business, what would that be?
Look, with how we participated, probably less than one, about 1% overall. Now, we have been selective in where we match and what we do with margins. We aren't interested in chasing the market to the bottom level. Certainly, where we've got key accounts and relationships, we're relying on our service and traditional relationships to not have to match every price that gets thrown through. There has certainly been some particular pricing out there that we've chosen not to match, which might have taken a little bit off the top-line revenue, but we certainly think maintaining pricing discipline in the short term will give us benefits as we flow into the medium and longer term and things stabilize.
Yeah. Is that because the customers then get reset to a new price, or is it that you don't have the systems to kind of move up and down rates?
We have the systems to move up and down, but like everyone wants you to reset a customer price, a customer gets attached to that price. Once you reset one customer, the industry, it's a small industry, that tends to flow through to the next customer and the next customer. We look to try to have a fairly structured and stable pricing matrix across all of our customer base. We certainly adapt and make minor changes, but we think getting overly aggressive and chasing volume for the sake of volume is not in the best interests of our shareholders.
Yeah. Just managing inventory, obviously that converts to cash flow, but these are not capital-intensive businesses. They're working capital-intensive businesses, and the inventory to sales has come back. I don't know whether that's good or bad, but from a growth perspective, obviously it impacts the potential nearer term around availability of inventory. How would you unpack the comment around potential stockouts if you run your inventory too tight?
I guess to go back, we consider it a good story, James. We're not putting our business at risk of stockouts. We actively manage our inventory on a national and breadth level. We have continued to invest in areas and product ranges and branches where we are seeing high growth potential. We've been very aggressive at making sure we offset that and pulling back inventory in a market or a branch that might have had a decline, etc. On an overall basis, it has balanced out. On a product range or a specific branch basis, we have seen investment where we think we need to. We haven't seen any fundamental change in our full rate full service levels as we've been working through that changing dynamic.
Yeah. That's wonderful. How does the ERP integration finalizing change any of that consideration around inventory, around management of the wider group, around further savings potentially in back office?
Yeah. Look, inventory, it does not change. It makes it easier to manage. It does not change how we manage it. There has probably been a few manual steps put in there, but in terms of how we assess inventory across both systems, we do that today. It will just be a little bit easier to do once it is on a single system. As I said, in terms of transactional ability of our Western Australian business, they have been on that same system. Potentially, we do expect to get some minor back-end staffing benefits. It might be one head in accounts, etc. It is not a dramatic change, but there will be a minor benefit once we move through that system consolidation.
Okay. Thank you. That was all from me.
Thanks, James.
The next question comes from Lorne Ashley Jeffries with Pinnacle Investment Management. Please go ahead.
Hello, guys. Did you get the full name in there? Just seeing with a view to margin, just where we're sort of sitting with Force in terms of its potential margin going forward, because I think when you first bought it, there was an aspiration to get that to 20%. Is that still reasonable, or is that slightly aggressive now?
Yeah. Look, we'll continue to benefit as we scale up that business line. It is a very different model to MaxiPARTS in that we've got three warehouses in place. Those three warehouses are sufficient to support the business on a national basis. Your investment tends to come through direct transacting sales team. Those sales teams work on a high commission basis, a low base. Once they get through that initial period, you do tend to get strong drop-through, and the gross profit margins are higher.
Certainly heading towards 20, that 15-20 range in the medium term is probably where we see it sitting. We'll continue to look at leveraging and expanding that business as we go forward. There will be ongoing improvements. We do expect certainly that growth rate, as we said before, to be double-digit. With the higher margins and the double-digit, it quickly drives some improvements in the overall group.
I think you said Force should deliver around 20 more for 25. Was that probably what you're?
Probably, yeah. Probably just north of that. Yep.
Just north of 20 and then grow at a double-digit sort of top line for a foreseeable future as you sort of penetrate. Yep. We're going. And Japanese parts offering, how penetrated is that through the full network at this stage?
Yeah. Look, it's through the full network. Certainly in the last 12 months, we had the project of rolling the program back out through the acquired Independent Parts site. That's there. By nature of maturity of the product range, those particular sites are still at the lower end of the maturity curve and have a higher opportunity to growth, but we are seeing consistent and successful growth through the network. We continue to adjust the inventory holdings on a site basis to make sure we continue to support and grow that business. A bit like Force, we do expect the growth rates from Japanese to continue at higher than the traditional MaxiPARTS business, certainly for a number of periods. Although we've made strong growth, it's not an instant click the fingers and it comes in. We do expect to see that come through multiple periods as we move forward.
I think you said 20% against the prior period. Is that 20% half or PCP number, again, something that's achievable in the next 12 to 24 months as you're sort of coming off a base situation?
Yeah. Look, it does get challenging, obviously, as it continues to grow.
Yeah. Of course.
Yeah, certainly whether it's mid-teens to 20% would certainly be our expectation probably for a couple of periods.
Double-digit.
Yep.
Yeah. The residual ATSG business, I think that at some point just rolls into normal gross margins and normal pricing. No specialized offering there.
Yeah. As we flagged that, that distribution agreement came to an end in August 2024.
August, yep.
There was a level of revenue that came through in that, probably about AUD 1.7 million in the first half. The revenue stream after that has become immaterial to the business, and what is left is reverted to traditional MaxiPARTS pricing. The low margin revenue stream converts to a lower revenue stream, but at normal margins, we'll just be considered normal business as we move forward.
Yeah. Is that taking place already, or is that still to come?
That took place at the end of August.
August.
So yeah.
August. Good one.
At that point. Yep.
Yep. Good, good. All right. Thanks, guys. Good numbers.
Thanks, Lorn.
We have a follow-up question from Jason Palmer with Taylor Collison. Please go ahead.
Yeah. Thanks. Sorry. Just one more around the embedded operations. You made a comment at the end of FY2024 that you had some expansion of on-site operations with key customers across both WA and the East Coast. I'm just curious whether that sort of flowed into the first half or whether there's still upside for major projects in the second half.
Look, there certainly was a level of flow-through in the first half. That is still an ongoing process. Yeah, there probably was just under AUD 1 million worth of revenue that flowed through into the first half. We are continuing to work on different sites and different opportunities with a number of those customers that we would expect to drive further growth into both the second half. The nature of them, they do take a while to set up, but certainly a little bit into the second half and certainly into the next financial year, we would expect it to be a more material lift.
Okay. Thank you. I just have one more around the cost management, which has been really impressive over the last 12 months. At what point or what top-line sales do you need to see in the underlying MaxiPARTS business before you start to unshackle the cost growth of the business and really invest behind it? I know it's a bit of a not trying to be a loaded question, but just to understand sort of how you think about that.
Yeah. Look, we think about it and adjust it every day. We do that every day on every side or at different projects. Although we have, as you pointed out, and we also agree, we think we've done a very good job of managing cost in difficult market time with high inflation, that hasn't stopped us investing in the business where we've seen growth. Particularly, our Western Australian operations that are operating at a high level have seen growth, whether that be into the acquired Independent Parts stores in terms of staff or general staffing across. We'll continue to do the same thing with Force. We expect it to be a bit more natural than what we originally made in terms of the Force business, but we are investing in the business.
We are just being quite aggressive at making sure we pull costs out in a branch or a function that might not have the activity that it did six to twelve months ago. We will continue to do that. We would hope to, I guess, maintain the expense versus revenue type leverages as we move forward. We are not expecting to see a step change in increase in expenses. Likewise, we do not think there is a step change down. We will more continue to manage it on a day-to-day basis.
Yeah. Wonderful. Thanks for the clean set numbers. That was good.
Thanks, Jason.
There are no further questions at this time. I will now hand the call back over to Mr. Peter Loimaranta.
Excellent. Thank you. Once again, thank you all for making the time. We appreciate the questions and the interest. I guess just to recap, we are pleased with the results. We do still think we're operating in a challenging market, but it's really pleasing to see benefits coming from both the strategic acquisitions and the organic growth programs that we have in place.
We expect those to continue to deliver benefits as we move forward. Certainly, I guess, like most businesses operating today, we do expect or do hope to see some market improvement that will allow those benefits to accelerate as we move forward. Once again, thank you all for your time and enjoy your day.
That does conclude our conference for today. Thank you for participating. You may now disconnect.