Ladies and gentlemen, thank you for standing by, and welcome to the H. B. Fuller Third Quarter 2018 Investor Conference Call. This event has been scheduled for 1 hour. Today's conference call is being webcast live and will also be archived on the company's website for future listening.
At this time, I will turn the meeting over to our host, Vice President, Investor Relations Ms. Barbara Doyle. You may begin.
Thank you very much. Good morning and welcome to our fiscal year 2018 third quarter earnings call. We have 2 speakers today, Jim Owens, our President and Chief Executive Officer and John Corcoran, our Executive Vice President And Chief Financial Officer. After our prepared remarks, we will open up the call to take your Let me remind you that comments made by me or others representing HP Fuller may contain forward looking statements which are subject to risks and uncertainties Our SEC filings contain additional information about factors that could cause actual results to differ from management's expectations. These filings can be found b fuller.com.
Also note that our comments may include references to non GAAP financial measures. These results are in addition to the GAAP numbers in our earnings release and our Form 10 Qs. We believe that a discussion of these measures is useful to investors because it invests it assists in understanding our operating performance and our operating segments as well as the comparability of results. A reconciliation of these non GAAP measures to the nearest GAAP measure is provided in the earnings release our company issued last night. I also want to remind you that in March of this year we filed an 8 K that included pro form a 2017 results that illustrate what our consolidated and segment level financial performance We chose to file this 8 K to provide you a baseline when comparing year over year performance.
During our call today, we will make some references to our growth in 2018 versus the pro form a results included in that filing. So with that, let me turn the call over to Jim Owens.
Thanks Barbara. It's good to have you here at HP Fuller. And thanks to everyone who's joining us on the call today. We had a very good third quarter with solid organic revenue growth margin expansion, increased earnings and strong cash flow generation. For the quarter, organic revenue grew almost 5% led by pricing gains and double digit revenue growth in engineering adhesives.
Adjusted gross profit margin improved by 110 basis points versus the same period last year, reflecting pricing momentum and synergy capture. Adjusted EBITDA of $120,000,000 was 63% above prior year and is an increase of 7% pro form a for Royal. Adjusted EPS was up 34 percent to $0.86 in the quarter and operating cash flow of $84,000,000 enabled us to pay down $41,000,000 in debt in line with our plans. Foreign currency exchange rates changed direction in the quarter and became a headwind. This impacted our 3rd quarter results by approximately $0.04 and our full year outlook by about $0.10 and we are adjusting our guidance accordingly.
Our core underlying business performance was strong and we continue to make excellent progress toward our 2020 targets. On our first quarter call, we identified 3 focus areas for fiscal 2018. As shown on Slide 4, And I'd like to update you on these 3 key areas. These were and are the top priorities heading into 2018. The first imperative was to realize annualized pricing to offset last year's raw materials inflation.
The pricing actions we've taken so far in 2018 will allow us to achieve this goal points of adjusted gross margin improvement We have continued to see increases in raw material feedstock, logistic and labor costs. And earlier in September, we announced necessary price changes in North America of between 4% 10%. We will continue to closely monitor our supply chain and we'll implement the appropriate pricing actions necessary to offset further cost increases. Another priority is to deliver $15,000,000 of cost synergies from the Royal integration. We have achieved $10,000,000 through the 3rd quarter and are on track to realize the $15,000,000 synergy target for fiscal 2018.
And the 3rd focus area for 2018 is free cash flow generation to enable $170,000,000 of debt paydown by the end of 2018. 3rd quarter cash flow from operations was $84,000,000 and we repaid an additional $41,000,000 of debt. The 4th quarter is our highest cash flow quarter, and we are on track to achieve our 2018 debt repayment target of $170,000,000. We continue to make notable progress on each of these imperatives, which is demonstrated in our growth, our margin expansion and our higher cash flow. Now I'll go through the performance of each of our segments in the quarter, which is summarized on Slide 5, as well as our expectations for the rest of the year.
In the Americas segment, organic revenue increased 2% year over year with pricing outpacing lower volume and mix. Similar to the second quarter, volume was down primarily in low margin businesses and due to the planned exit of lower margin business from the Wisdom acquisition. Pricing will continue to be a net contributor to America's growth, and we expect to see the negative impact of volume moderate as we exit the year. Pricing and acquisition synergy capture are driving significant EBITDA improvement. In the 3rd quarter, Americas Adhesives EBITDA margin of 18% increased sequentially from 16% in the 2nd quarter and we exceeded the 17% target we discussed last quarter.
We expect margins to year over year, reflecting pricing actions, particularly in emerging markets. EBITDA margin was 10.5%, which was lower than Q2, reflecting typical summer seasonality as well as currency impacts in that region. In Q4, we expect to see slightly slower growth due to currency impacts but improving margins in the higher volume fourth quarter. In the Asia Pacific segment, organic growth of 3% was lower than our trend. As volume growth slowed from Q2.
We saw strong growth at Southeast Asia, Korea and Australia, but China growth slowed in the quarter as consumers and exporters decrease their spending. We expect this to continue into the 4th quarter. Adjusted EBITDA margin of 10% increased eighty basis points over last year as positive pricing and volume contribution offset raw material inflation. In the fourth quarter, we anticipate similar revenue trends and year on year margin expansion. Construction Adhesives revenue pro form a for Royal was flat year over year, while EBITDA margins improved by 220 basis points This is part of our overall As part of our integration with Royal, we are taking additional actions to reduce costs, adjust our customer and product portfolio and ensure continued margin expansion in this segment.
As a result, we expect continued low single digit growth and significant margin expansion in this segment and in Q4 and through 2019. Lastly, performance in Engineering Adhesives was very strong again as we maintained double digit organic revenue growth, Results were strong due to the highly differentiated as they introduced new and improved products. The EA performance was broad based with strong growth across all segments and all geographies in both the legacy H. B. Fuller and Royal Businesses.
EBITDA margin 16% increased 20 basis points sequentially from Q2, but was down slightly versus last year to a higher raw material cost a portion of the business where we are taking price actions to offset higher input costs. We expect to see continued strong top line performance and sequential margin improvement in the 4th quarter. Overall, we performed well in the third quarter as we managed through the challenges of raw material inflation, dramatic currency fluctuations and economic unease in China. I'll now provide an update on disciplined rigor and a sound governance process, successfully keeping projects on track. Our procurement savings programs continue to deliver the expected benefits with $10,000,000 of cost synergies recognized to date.
We're on pace to deliver 15,000,000 targeted cost synergies for the year. In the third quarter, we announced plans around the closure of a New Jersey plan and will consolidate its production into the South Bend Indiana site over the next 2 years. This is in addition to the 2 plant closures we discussed during our second quarter call. We continue to evaluate other opportunities to optimize our manufacturing footprint. From a revenue standpoint, we continue to identify new opportunities that support our $50,000,000 revenue synergy target by 2020.
Many of these synergy opportunities have been refined and validated and are making their way into our 2019 budgeting process. We continue to be pleased with the complementary nature of our technology portfolios. As discussed at Investor Day in July, we expect to see significant growth coming from our reactive urethanes, cyanoacrylate and anaerobic technologies, as well as metal to rubber bonding capabilities in engineering adhesives. This, along with our high efficiency 4sg spacer technology for insulated glass in our durable assembly business. We have made steady progress on the Royal integration, which is evident in our pro form a growth rates and in our EBITDA results.
And as we move through the integration, we continue to strengthen our visibility expected synergies.
Thanks, Jim. As Jim said, overall, we're pleased with the performance of our business in the quarter, especially given the continued inflationary pressure on raw material costs, as well as significant headwinds from currency movements. Net revenue grew approximately 37% compared to the third quarter of 2017, driven by the addition of Royal. Organic revenue growth grew 4.8%. Pricing was a strong contributor to growth as we realized benefits from pricing actions we've taken throughout the year to offset raw material costs.
Volume and mix impacts were about flat for the quarter. Foreign currency exchange rates had a negative impact on revenue in the quarter, Due to what strengthening these dollars, I'll talk more about in a minute reducing growth by approximately 2% year on year. On a pro form a basis, including Royal in 2017, adjusted gross profit margin of 28.7 percent improved 110 basis points versus last year and increased 40 basis points sequentially from the 2nd quarter driven by strong contributions from pricing expenses increased by 6.5 percent year over year on a pro form a basis, primarily driven by the annualization of last year's Atacol acquisition and timing of other expenses. The net of at EBITDA of $120,000,000 increased by 63% versus the prior year and increased by 7% on a pro form a basis, including Royal. Adjusted EBITDA margin increased to 15.6% from approximately 13% last year.
Let me also comment on our third quarter results versus guidance. While we showed strong organic growth and margin improvement, currency had a more negative impact on 3rd quarter results than we considered in our prior guidance. Slide 8 shows the average depreciation that occurred between the 2nd quarter 3rd quarter in the top non U. S. Currencies that impact us.
Relative to the exchange rates used in our guidance, the euro, Chinese renminbi Brazilian Real, Argentine Peso, Turkish layer and other currencies turned lower throughout the quarter with several moving substantially lower. We estimate these currency shifts impacted revenues by approximately $15,000,000, impacted EBITDA by approximately $4,000,000 and impacted adjusted EPS by approximately $0.04 relative to our guidance assumptions. In Q4, we estimated that in Q4, we estimate that currency will impact revenue by approximately $20,000,000 EBITDA by approximately $5,000,000 and EPS by approximately $6,000,000 relative to our prior guidance. In addition, while we pricing performance, reflective of the weakening economic issues in China, as Jim mentioned. We see these headwinds continuing in the 4th quarter and as a result, we are adjusting our guidance for fiscal 2018.
Adjusted EPS is now expected to be in the range This represents EPS growth of 25% at the midpoint of the range. We anticipate that net revenue will grow approximately 17% in the 4th quarter driven by adding the Royal business. On a pro form a basis for Royal, we anticipate revenue to grow by approximately 3%. At today's rates, we estimate that currency will have a negative impact of 2% to 3%. Acquisitions will contribute about 1% of growth, Organic revenue growth of 4% to 5% will be driven primarily by pricing to offset raw material cost increases and to a lesser extent, volume and mix.
Positive pricing, underlying operational improvements, the Royal Acquisition and synergies from the acquisition will contribute to EBITDA in the range of $455,000,000 to $470,000,000. This represents a 10% increase on a pro form a combined basis at the midpoint of the range. Full year depreciation and amortization will be approximately $145,000,000 for the full year with about $55,000,000 of new D and A related to Royal Full year net interest expense will be about $100,000,000, with about $65,000,000 related to financing the Royal acquisition. The company's core tax rate, excluding the impact of discrete items, is unchanged and is expected to be between 25% 27%. Capital expenditures are now expected to be approximately $70,000,000 in fiscal 2018.
And we continue to anticipate free cash flow generation that will be used to repay $170,000,000 of debt in the 2018 fiscal year. Now let me turn the call back
Thanks, John. In summary, our business performance in 2018 continues to progress very well in the third quarter. Despite the currency movement and a more challenging economic environment in China. We've grown organically executed on our pricing strategy and delivered continued margin improvement. We are well on our way to successfully integrating Royal, offering an expanded set of high value solutions to our customers.
We are also delivering on our cost and revenue synergy plans favorably impacting our financial results. Our EBITDA and cash flow continue to increase, and we're on track to pay down $170,000,000 of debt this year. All of this gives us confidence that we are on the right path toward our 2020 financial deliverables, which we discussed in detail at our recent Investor Day. Thanks to those of you who attended our Investor Day, whether in person or over the webcast. During our Investor Day, we said that in order to achieve our 2020 EBITDA and cash flow targets, we needed to deliver on 3 key deliverables.
These were to achieve double digit growth in engineering adhesives, $35,000,000 in Royal related cost synergies and operating efficiencies in manufacturing to drive margin improvements in our core business. We again this quarter showed a significant progress on all three of these strategic objectives with double digit growth in engineering adhesives excellent delivery on synergies with $10,000,000 delivered year to date and margin expansion to 15.5% in the quarter, in part due to operating efficiencies. This quarter was strong in our path to deliver our long term strategy and financial commitments is proceeding as planned. This wraps up our prepared remarks. So operator, let's open up the call to take some questions.
Questions.
You. You may re queue as often as you would like. Our first question comes from Mike Harrison with Seaport Global Securities. Good morning, Mike.
Just wondering, Jim, if you can go into maybe a little bit more tail on what you're seeing in, in China from an uncertainty standpoint. Is this more consumer driven or having to do with government policy or maybe just give us your thoughts on what you're seeing and what has you more cautious there?
Yes, I would say and we've seen reports of this in we report early. So we give a view on China maybe that and as you know, we have a nice size business there. But yeah, I would say, it's both across the consumer goods businesses. And so our packaging and our hygiene businesses and also, some of the adorable goods that are exporters. So I think There's a bit of uncertainty there.
And I think, consumers are spending a little less. And I think, manufacturers are or maybe reducing some of their inventories. We do see some pickup in Southeast Asia. So I think for customers who have options as exporters outside of China. I think they're, they're sometimes shifting some of their production over there.
So, but yeah, we definitely see it across a a number of our businesses. And I would say it's mostly been in the last 2 months that we've seen it, and it continues here into this month. So that's I think a general economic and a business that we've looked at in our Asia Pacific business to be close to double digit growth is probably going to be closer to lower single digit growth and that has a pretty big impact on our issue results.
All right.
I don't think this is a in turn problem in China. I think it's a short term issue probably related to all the news around tariffs and concerns that consumers have. But that's just my supposition based on conversation that would keep on conversations that would keep on.
And then was also to get just a better understanding of what drove the EBITDA margin improvement in the Americas And obviously, you called out some of the volume weakness and some of the reasons there, but maybe just a little bit more detail on kind of how that volume decline is going to trend going forward or how that's going to play out and how sustainable something like an 18% EBITDA margin could be in Americas?
Yes. So I can let John comment on specifics of the 18%. But the Americas team has done a great job. I said this going into Q2, right? They took a pretty strong approach to recovering their prices Q2.
Some of that continued into Q3. So very sustainable where they brought the business. The WISM business had some pieces of business that were very low or 0 margin. They shed those at the beginning of this year. So and those were very strategic, I think, in terms of improving the portfolio.
So I think they've been, targeted and thoughtful about price increases and, and where they've had to let business go. It's been lower margin business. So We're also seeing some synergies there, right? So I think some of the, Royal related synergies offensively as well as as on some of the raw material sides are helping that business as well. So really good performance and broadly sustainable.
I think I said for a long time that we expect that business to run-in that 17%, 18% range. And I think that's the kind of expectation you should have going forward. John, you want to comment?
Yes, I think that covers it very very well. I mean, it really is pricing led. As we look at pricing realization, in the second quarter and then particularly in the quarter, we're definitely seeing that come through and significantly outpace raw material costs. It is a little bit of the synergies that Jim talked about, but all the profit and margin improvement deliveries at the gross profit line.
Thank you. We'll take our next question from David Begleiter with Deutsche Bank.
Jim, just on Q4, it's still a pretty wide range of $0.15 or sorry, $15,000,000 of EBITDA, I'm sorry, and $0.10 on EPS. What's driving that wide range at the moment?
Yes. Let me give that question to John. We have specific goals exactly where we're going to be and we're trying to give a range based on the level of uncertainty that's out there in the world, but maybe you can comment more on the size of the. Yes.
I would say it's uncertainty related to exchange and and a little bit economically China in particular. So we've we're probably, I think, a nickel wider than we were last year. And that's the reason.
And I would just comment, David. I mean, we report on a quarterly basis and we have a quarterly target and we're hitting we're hitting those Last quarter, we were a few cents above what everybody expected. This quarter, we're a few cents below. We set an annual target at the beginning of this year And if you take this $0.10 of currency impact, we're going to end the year spot in the middle of where that started. So So I think we look really at this long term view on what we're going to deliver for the year and it's going to end up in a very solid year right in the middle of that target.
So I think we're not trying to avoid getting into the quarter to quarter game, but I think it's a fair question.
Understood. And just I know it's early, Jim, but any early look on 2019 from either an EBITDA or ATS perspective, just maybe a range for either one of those 2?
Yes, I think it is a little early for us us to give you that. I think we're positive about 2019. I think we feel we laid out some plans at the Investor Day. We feel really good about those. The obviously, the currency is a little different, but currency goes up and down quarter to quarter.
So we'll have to factor that into 2019. And then as I said, I think the China issue, while I do think it's going to happen in Q4, I don't think it's a systemic problem. I think this is more. So I would say look at our Investor Day deck and what we said in terms of, 2020 2019 should be a really positive step in that direction. And fundamentally things haven't changed.
And, the only thing that's changed a bit is the currency. So John, do you want to I'm sure you don't want to add anything to that?
I think that's a yes. Think that's a very good summary.
But we feel good about where the business is.
Great. Thank you very much.
Thank you.
Thank you. We'll take our next question from Eric Petrie with Citi.
Hi, good morning guys.
Good morning, Eric. Could you
give us an update on your for an annualized pricing target this year? And how much coverage do you have of raw materials in 2018?
Yes. So, again, I gave that number in Q2. So, that's something we update on a regular basis, but I think we said we delivered $50,000,000, which we did in Q2. We delivered more this year. I would say cumulatively were today between $90,000,000 $100,000,000 maybe close to $100,000,000 of price increase executed on an annualized basis.
And And as we've said, that's recovered more than the increases we've gotten this year.
And on construction products, your volume improved significantly and you saw acceleration or contribution from the Royal Business. Is that sustainable going forward or did you have any nice product wins there?
Yes, there's two stories going on there. I think if you just look at the PBM and our data, you'll you get a really nice look at what's happening to our legacy business. So really strong quarter from a volume standpoint on our legacy business. As I said in the script, though, when you net the two businesses, relatively flat from the top line with very nice margin improvement. And I think that's what we're really targeting here over the next 12 months in this business.
We think as we've looked at both businesses strategically and we bring them together, there are some parts of those businesses that are generating a lot of profit performance and we want to grow those faster and focus on those. There's other customers and portions that are less profitable and I expect us to decrease our position with those. So I think if you look at that business going forward, it's going to net out a very low growth with good margin improvement. And what it's going to do going forward. But yeah, as you point out, we had a very strong top line quarter relative to last year in the legacy business which for guys like you that have followed that for a while, it's very encouraging and in line with what we said we do.
Thank you,
We'll take our next question from Ghansham Panjabi with Baird.
Good morning. I guess going back to America's adhesive, last quarter you called out the Brazilian strike as part of the reason volumes were down 5%. It was still down 5% during the third quarter in the context of a very strong economy in the U. S. Did that surprise you any particular categories that were weaker than you thought they would be?
Yes, I wouldn't say there's any categories that were weaker. I think if we had predicted the volume number, it would have been a little higher, not much. Because of that Brazilian thing. So I think it might have been negative 4. The biggest driver of that is the biggest driver is the businesses we decided to shed related to wisdom, that were essentially 0 margin businesses.
And then, and then some of the impact of price increases. So those were the 2 big factors, but But you're right. The Brazilian thing, of course, didn't happen this quarter. So, so and And I think we're going to start lapping those wisdom exits. So you'll see more positive volumes as we go into the fourth quarter and certainly into next year.
But in terms of the overall economy in the U. S, we see positivity. I think if you, if you parse the part, the numbers in the Americas, good positive economic activity, particularly in more of our durable assembly goods, things like recreational vehicles, of course, are strong. And I think overall, very positive, less positive economic activity in Latin America, but not negative, just not as positive as the states. Okay.
And just my second question on the back to the weakness in China, for what you're seeing thus far is in products that are consumed locally, products that are exported, which specific end markets are you seeing any sort of incremental weakness? Thanks so much.
It's a little bit of both. So I'd say the consumer good side for us is hygiene and consumer packaging. So and generally, the products that we sell into are in the middle to upper class consumer goods areas. So we see some weakness there. And then on the durable assembly side, Most of the stuff that's for the domestic market is not weakening, but anybody who's an exporter, you see whether it's inventory declines or loss by you may see a little bit of decline there.
So that's what we see in China.
Again, just to finally clarify, the only incremental weakness from a macro perspective you've seen is in China, correct?
That's correct. That's correct. Macroeconomically, we see a lot of positive things all around the world.
Got it. Thank you so much.
Yes, I'd just add maybe Turkey a little bit, right? I think the currency has really put Turkey on some uneven footing. So I think that'll spring back as people recalibrate, but yeah, China and Turkey would be the 2 places. Thank
We'll take our next question from Christopher Perrella with Bloomberg Intelligence.
Hi, good morning. Question to dig a little deeper on the Americas Adhesives. I would have thought that, year over year you would have seen still have been negative with the loss of the Wisdom business. But why how much is that the deselection of the Wisdom business contributing to the volume decline in the third quarter? And then just to clarify on the guidance, do you expect to see volume term positive in the Americas in 4Q were just less negative?
Yes. 2 big factors I would say, again, we don't have exactly specifics on each of these to share today, but about half of it is wisdom business that we purposely exited. And I'd say, the other piece that you'll see in our volume numbers is a business that we've exited as a result of price increases. So we've been aggressive with price increases and where we've had to shed lower margin customers where they've made, where they're making marginal decisions. We've exited some of them.
So So those are the 2 biggest factors that are driving the Americas volume numbers for Now there's a combination of volume and mix you have to look at in our business and mix was positive. And underlying, I think the team is is managing the portfolio to make certainly have a stronger business. So I wouldn't look at that volume number as an indicator of what's happening underlying economically. But more about the strategic moves we're making in our business.
Thank you. We'll take our next question from Jeff Zekauskas with JP Morgan.
Thanks very much. Your adjusted SG and A expense is running around $140,000,000 a quarter, maybe a little bit lower. Do you think that will be true for the fourth quarter or are there unusual expenses that occur in the fourth quarter?
No, I would say, Jeff, that's going to be kind of our run rate. Kind of third quarter, maybe trending down a little bit into the 4th quarter. It shouldn't be, anything unusual though.
So your volume growth was really your organic volume growth was really pretty good in engineering adhesives. Can you remind us what are the top 3 geographies for engineering adhesives and the top 3 end markets?
Yes, I'd say if you look at our growth, as I mentioned in the script, it was very broad. So, The growth really nice growth continues in our electronics business. That's off of a new consumer goods wins that we have. As well as we're now penetrating some of the areas of microelectronics. So that's really positive for us.
On automotive, we've done a really good job over the last couple of years of getting specified particularly on interior trim applications. So that's driving the automotive growth along with a few synergy projects that are starting to come through in the automotive business that are hitting the numbers the second half of this year. And then U. S. Assembly is very strong for us.
So there's a, an assembly business that we had with Cyber Bond as well as as part of the Royal Acquisition company they bought called ASI. And just this broad based economic growth in the U. S, is showing up in growth in, in North America. So that's where we're seeing the best growth also some positive wins we've had in the truck business in Germany. So those would be the pieces of this that I'd call as our our biggest drivers of growth in that business.
Thanks for that. Were you to appointed by the rate of volume growth
Let me take a look at the numbers here. Yeah, I would say it's a, it's probably a little lower, I guess, Jeff, and I would have expected, our EMEA business includes, all the Middle East and Africa, certainly the Turkey the Turkish devaluation in the middle of the quarter had an impact on our sales in that country. We got a nice sized little piece of business there that slowed down a lot in the quarter. So, and, so yes, probably a little less, but again, as the team moves forward, Now our objective here is to work on the quality of our business. So as we especially when we're leading relative to smaller competitors, we're going to have a little bit less volume growth in these kind of inflationary times and we're willing to give that up to improve margins.
So that would be sort of a high level look at it. But it's probably a little lower than I would have expected.
I guess lastly, I think you're going to spend $70,000,000 in CapEx this year. And my recollection is maybe you were expecting to spend maybe 80 or more earlier in the year. Is that because you're they're going to be lower capital outlays or what you don't spend or or what's not going to be spent this year will flip into next year?
Yes. I think what you there's a little bit of delay into next year on a couple projects. So we've looked at the timing of some of those projects. So a shift by a quarter of certain projects a couple of the Royal projects are a little smaller than we thought. There's one that's bigger that comes next year.
So yeah, I'd expect a little of it to slip into next year but some of it is savings that we found relative to, what we were going to thought we were going to spend in the year. So a little bit of both, I guess, is the short answer. But not a dramatic shift in the next year, Jeff. That's your question.
Thank you. We'll take our next question from Ms. Ren with Berenberg.
Hi, thanks.
So just looking at full year guidance, the implied EBITDA growth rate for the fourth quarter looks quite high 50% to 30%. Is that realistic? And is there anything unusual happening in the fourth quarter like lower maintenance cost or just some higher shipments or something?
So, we it is a higher volume quarter overall. And I think, Perfetch, maybe looking at looking at this number, not on a pro form a basis, on a pro form a basis, I think it would be growing in the mid teens. From a year on year standpoint. So we're obviously carrying all of the pricing we've gotten to date into the fourth quarter and we have and we it is our higher volume quarter. So but it's not a dramatic shift from what we saw for the first half of the year and third quarter.
Yes, I
think we had a 63% increase in EBITDA like for like this quarter. So, but I mean, not like for like, but ex Royal in both quarters. So yes, I think more in the mid teens is what you should expect in terms of EBITDA growth.
Got it. I'll check. And then on the slide on the currency, outside the euro and Chinese RMB, which what are the other 1 or 2 biggest exposure and how much exposure do you have to the Turkish lira?
I would say, again, we don't get into all the specifics of each currency, but fundamentally, I think the right way to think about our business is it's a third exposure to of the numbers John shared. We have a third for RMB, a third for the euro and a third for everything else combined. And it's not heavily weighted to the lira obviously Lear is a big story for us, but it's broad based across lots of currencies.
And, Paretosh, with the slide lists the currencies in the order that of our largest exposures.
Thank Thanks everyone for your time and your support of H. B. Fuller. We appreciate your input today.
Operator, we'll conclude the call now. Thank you.
You're welcome. Thank you, ladies and joining for joining today's conference. This concludes the call. You may now disconnect.