Greetings, and welcome to the American Vanguard Corporation Fourth Quarter and Full-Year 2014 Conference Call. At this time all participants are in a listen only mode. A brief question-and-answer session will follow the formal presentation. [Operator Instructions] (Operator instructions) As a reminder, this conference is being recorded. It is now pleasure to introduce Bill Kuser, Director of Investor Relations. Thank you. You may begin.

Well, thank you very much and welcome everyone to American Vanguard's fourth quarter and full-year 2014 earnings review. Our speakers today will be Mr. Eric Wintemute, the Chairman and CEO of American Vanguard; and Mr. David Johnson, the Company’s Chief Financial Officer. Mr. Bob Trogele, the Company’s new Chief Operating Officer. Before beginning, let’s take a moment for our usual cautionary reminder. In today’s call, the Company may discuss forward looking information. Such information and statements are based on estimates and assumptions by the Company’s management and are subject to various risks and uncertainties that may cause actual results to differ from management’s current expectations. Such factors can include weather conditions, changes in regulatory policy, competitive pressures and various other risks that are detailed in the Company’s SEC reports and filings. All forward looking statements represent the Company’s best judgment as of the date of this call and such information will not necessarily be updated by the Company. With that, we turn the call over to Eric Wintemute.

Thank you, Bill. Good afternoon, everyone. Thank you for joining us today. As the reported results indicate, 2014 was a challenging year for American Vanguard. During the last year we have commented regularly, the significant impacts of carryover inventory in the Midwest distribution channel. This excess inventory largely resulted from weather-related usage reductions of many crop protection products for corn during the spring planting season of 2013. With such considerable quantities already available in their own inventories, many distributors, retailers and corn growers did not mean to order a normal level of these products during 2014. As a consequence, our granular corn soil insecticide and Impact corn herbicide sales declined significantly in 2014. Nevertheless, while on the ground use of our soil insecticide declined somewhat from the prior year, Impact use actually increased significantly about a third. Also, although we had a modest growth in other crop segments, the shortfall in our corn segment of approximately $90 million drove the Company's year-over-year revenue decline. Further in 2013, our U.S corn products accounted for 38% of our $381 million in overall sales. In 2014, these same products accounted for only 18% of our $298 million total. With the reduced purchasing that we experienced in 2014, the level of excess inventory of our corn products in the distribution channel has declined. And we believe that more normal procurement patterns can resume in 2015. The Midwest corn market continues to experience expansion and intensification of Glyphosate resistant weeds and GMO resistant soil insects. While present market conditions may be influenced by near-term commodity prices and crop rotation, a continued long-term need for our proven corn products remains. As we’ve mentioned in our press release, we’ve taken significant steps to streamline our manufacturing costs and reduce operating expenses. David will now provide some specifics on these programs as well as discussing our efforts to reduce inventory and working capital levels. As you know we've always focused on maintaining a strong balance sheet and prudent use of our credit facility to meet both current operational requirements and the pursuit of new product acquisitions. David?

Thank you, Eric. As you all have read in our earnings release, overall financial performance for 2014 was down in comparison to 2013, with the Company's total net sales down 22%, including crop sales down 23% and non-crop sales down 10%. From my perspective, the issues of paramount importance are: first, understanding the drivers about sales and margin performance. Second, what we’ve done to manage the under recovery of our factory cost. Third, what actions we had taken to curb operating expenses. Fourth, what are we doing about inventory levels, and fifth, what impact this all this have on our liquidity. First, on sales performance. As Eric indicated a few months ago, a $90 million drop in sales of our products into the U.S corn market is a cause of our drop in overall sales. Within our crop business sales into other crops like peanuts, sugar cane, potatoes, and high-value vegetable crops were actually up by $11 million. Within these other crops, are fumigants, insecticides and non-corn herbicides, all marginally up. Our Thimet product that mainly goes on peanuts had a very strong year. Our PCNB sales improved as we work to steadily reestablish our place in the turf and potato market, our Pest Strip and Envance product lines also saw a solid improvement. Furthermore, we’ve seen our international sales grow by 6% including strong global sales for our Mocap Nemacur product lines. Second, as the year progress, we took action to reduce our monthly operating costs. And second, to curb inventory growth. Slowing the factory has an immediate impact on manufacturing overhead costs recovery. We have disclosed this elevated under recovery during previous conference calls and as you will read in our 10 K, approximately two-thirds of the year-over-year drop in gross margin performance from 45% in 2013 to…

Thank you, David. Now I'd like to take this opportunity to introduce our new Chief operating Officer, Bob Trogele, who joined us at the beginning of this year. Bob comes to American Vanguard from FMC Corp where he served most recently as President of Asia Pacific and previously as North American Director of their agricultural solutions business. As COO, he will oversee sales, marketing, and business development on a global basis. And will focus on growing our business across multiple product lines and geographies, achieving greater profitability, and establishing a pipeline of future opportunities through innovation and strategic relationships. I have known Bob for over 10 years and greatly admired his tremendous track record of spurred unprecedented growth and superior profitability. Prior to his business career, Bob was an elite basketball player representing the German National Team as a two-time Olympian. He attained both an MBA and Ph.D. He is fluent in both French and German and since 1997 has served as professor of international business at the Berlin University School of Economics and Law. With that introduction, let me allow Bob to comment on his objectives for this new role. Bob?

Thank you, Eric for that introduction. Hopefully I’ll have the opportunity to meet with many of you in the future. As Eric stated, we’ve known each other for over 10 years and I’m looking forward to working closely with him in driving future business growth and value creation for the shareholder. I admire the success of this Company and its leadership. Further, I'm looking forward to working with our experienced, distinguished Board of Directors, many of whom I have had the pleasure of working with and observing over the years. In addition, the Company has recruited a top-level professional management team, many of whom I know very well. Historically, American Vanguard has a solid growth record underpinned with a strong entrepreneurial spirit. I'm excited to join American Vanguard because I see a great opportunity to utilize, my extensive network of relationships with customers and industry peers throughout the globe to expand the Company's past success. I'm confident that we can drive value creation for all stakeholders through innovation, technology, strategic alliances, and global market access expansion. Looking forward, we will drive toward diversifying the product portfolio, expanding crop segment presence, and enhancing our regional focus. Short-term, we will be looking for all potential upside opportunity as the market in 2015 evolves. Now back to Eric.

Thank you, Bob and welcome to our team. Now let me comment on some of the challenges and opportunities that we have in front of us. We all recognize the headwinds that exist in the U.S corn market over the next year. Core profitability trimmed by lower corn commodity pricing, the potential for corn to soil crop rotation, the possibility of the colder weather conditions could diminish insect pressure. Counterbalancing these issues, we have eight years of solid university field trial evidence for the yield enhancement benefits delivered by our corn soil insecticides. We have a distribution channel that has significantly reduced the excess inventories that curtail 2014 sales. We expect to see rising demand for our new liquid soil insecticide Xpedient as growers become familiar with this convenient cost-effective treatment. And we have begun a new marketing relationship with DuPont's Pioneer division that incentivizes Pioneer seed purchasers to use AMVAC soil insecticides. In other crop segments, we have additional opportunities for several of our products. Last year we received late in the season a Section 18 registration for our Counter insecticide in two States for the control of nematodes in cotton. This year, we are looking for early approval in four key States. In the potato, and other crop market, we are seeing increased sales of our insecticide Mocap as a replacement for existing competitive products that is in short supply. Further, we are pleased to report that last week we received a 24(c) registration for our insecticide Thimet used to control sawfly in the wheat crops of Montana. Over the past two years we have been successfully testing our products on this relatively new destructive pets. And finally, we still expect to receive European Union approval for our SmartBlock potato sprout inhibitor during the first half of 2015, which would open up an attractive new market for AMVAC. I also want to mention that we remain active in our pursuit of product additions to our portfolio. We’ve several such editions under evaluation presently and we’re focused on making the right purchases, at the right price to complement and expand our existing market position. So to conclude, we have faced challenging times recently. We have adapted our organization to respond appropriately and we’ve attracted top notch talent to the Company. And we continue to believe in the attractive benefits that our proven crop protection products provide. And with that, now operator, I’d like to turn over to any questions we may have.

Thank you. Ladies and gentlemen, we will now be conducting a question-and-answer session. [Operator Instructions] Our first question comes from Chris Kapsch with Topeka Capital.

Good afternoon. So my question relates to current market conditions at an investment conference currently ongoing both Monsanto and DuPont are talking about challenging near-term conditions, probably not a big surprise, but the headwinds being -- farmers being a little bit more thrifty in the context that seeds maybe trading down. Also, maybe some deferred purchases of crop protection chemicals. So I'm just wondering how much of this are you seeing? Is this thriftiness and maybe the pause that the grower is going to hear as he looks to the growing season resulting in any -- changes in behavior in terms of what the pricing expectations might be for your products or if they’re trading down to lower quality seeds and trades, are they maybe more inclined to not protect those as much with the -- that the fact thought insurance policy that your insecticide provides, any color on that would be appreciated?

So with regard to the seed companies, the lower trades, that’s one of the reasons why we did this program with DuPont. And in fact, Monsanto does endorse as well the use of insecticides with the lower trades. So that’s potentially on the upside for us, but no doubt that growers are waiting. They are looking for the best deals they can get. There is -- we did not increase for the most part the pricing in our corn soil insecticides and after three years of doing so, I think they know the market is soft, they’re kind of making -- they will make decisions may be a little later than they might normally, knowing that there is plenty of inventory. There aren’t shortages of what they’re going to need and they can make that decision about how much they're going to plant corn or soy beans or wheat, they can make those decisions probably towards the last few minutes and still be assured that they will get what they want. So I think that's probably what we're seeing, so I think there was -- and when your statement there is a little bit about there is potentially some upside, but there is no doubt that if they want to cut, they certainly could -- can cut. I think there was a list of things that they would cut and I think equipment was at the top and herbicides were at the bottom and just above herbicides, I think were insecticides. Fungicides would be something that they’re probably likely to go without as well. So that’s -- it’s a mix bag right now.

Yes. And is this dynamic affecting the intended pricing? I know the industry generally didn’t -- wasn’t -- didn’t expect to push much in the way of pricing through, but I’m just wondering as this plays out in a channel currently is there pressure for or is there competitors looking to discount in order to try to spur little bit more demand at this point?

Yes, I'm sure at all levels whether its retail or wholesale, I mean there is going to be pressure to not be left holding inventory. So I don’t know that that, I mean, there will be a lot of pressure from growers to try and take the best deals. So I think that will be -- I think it will be a competitive year.

Okay. And maybe if I could just also a follow-up for Bob, and congrats on the new role Bob and I appreciate your prepared comments about the exciting opportunity with American Vanguard. Just wondering if you -- maybe some color on contrasting in your eyes the competitive positioning of an American Vanguard versus your former employer and how that may translate into some of the imperatives that you talked about in terms of little bit more innovation, technology, acquisitions and so forth and in terms of trying to help this Company grow? I would appreciate that. Thanks.

Yes, thank you Chris, for the congratulations. I look forward to meeting you sometime personally. I would just say that when we look at the global market space this Company has grown historically from a U.S base. I would say we have lots of expansion opportunities over long-term time period to expand globally as we acquire products, improve our footprints in key markets internationally. So that’s I think one great opportunity for American Vanguard. And secondly, our portfolio is still very limited versus many of the larger competitors. So we’ve a lot of white space, so we’re available as we strengthen our market access for technology companies to approach us. We have white space to acquire, chemistries and technologies to put into our portfolio that are non-competitive with our own pipeline. And I think this Company just had a great job coming from a manufacturing base to a technology base, and just hiring the right people from a scientific experience to drive technology as it comes into the portfolio. So I hope that answers your question, Chris.

Yes, I appreciate it. And then just one quick follow-up though, I mean, on contrast that between the American Vanguard and FMC is the -- just you guys have the ability to manufacture, FMC had been more of a capital light approach and I don’t know, I guess, is there contrasting those sort of strategies, is there -- does it really matters, it really just more about having a formulation or to registrations and the innovation. Just any thoughts on that would be appreciated. Thank you.

Well, Chris, I will just say that American Vanguard as it has acquired products; it has also acquired manufacturing assets. And you can then speculate how will that in the long-term play out, if you look at the increasing cost of production environmental controls, in foreign markets, this could be an advantage for a Company like American Vanguard going forward. So I’d just say that it's too early for me to really to assess what is the competitive advantage of that versus some of the other competitors.

Fair enough. Thank you.

And maybe Chris, just to add to that obviously we’ve seen during -- when there are strong demand for our products growing at a rapid rate, which is what we saw in ’11, ’12, and ’13, we were able to react pretty quickly and keep up with that demand. That's the upside. And of course the downside is when that demand diminishes or in the case it was overstated, so to speak, then we are less dealing with assets that we built that aren’t fully utilized. So -- but as Bob said, we think from a sustainability standpoint, having the assets that we do for relatively a small amount on our books, we believe ultimately is a strong sustainability statement.

Thanks, Eric, for the extra color.

Our next question comes from Brett Wong with Piper Jaffray.

Hi guys. Thanks for taking my questions. I was just wondering if you can talk through -- and I know that it is early and it still seem to be [technical difficulty] crops corn and soy and cotton?

I don’t know that we quite got all, but I’m going to try to restate, you’re asking about where we think acreage in corn and soy beans and cotton will be this year?

Yes, yes.

Okay. So I think corn, people are taking out anywhere from 87 million to 90 million acres. So if you figure 88.5 million, somewhere around there and then soybeans is probably in that 84 million, 85 million. There was some speculation that they might be equal, but I think that it will be closer in that range. Cotton is it's likely to be down into that 9.5 million to 10 million acres range. So I think that’s generally what we're hearing from -- we can -- [indiscernible] ask everybody the same question, I think and so you try to -- its one of those circular things whether trying to get different opinions from different peers and customers. But that’s basically what we’re hearing.

Okay. And with cotton acres down, is that a concern with the Company and for cotton product as we look out through 2015?

No, obviously we’d prefer cotton to be up, but keep in mind as far as the insecticide piece where our Bidrin, it’s a function of pest pressure. So sometimes you can have lot more acres with less pest pressure and so less than when you’ve fewer acres with strong pest pressure. So that’s one piece of it. And then of course on our defoliant we’re looking at -- that’s a weather related product. So if it doesn’t -- if it gets real hot then the cotton leaves burn off naturally then you don’t need the defoliant. If it stays relatively mild through the September-October time, then they wind up using quite a better material. So -- and then Counter as we had mentioned, again we’re hopeful of getting Section 18 in expanded States from last year at an earlier time and this will be a new opportunity for us for controlling nematodes. And this is kind of filling of a gap that’s been there for quite a while now with the loss of [indiscernible] as a product for nematodes. So that pressure has been building and building to the point where the States has now said hey, we’ve got to have something here and here is a product that works.

Okay, great. Thanks, Eric. Just looking at pricing again, you mentioned you didn’t look to see a higher [ph] pricing, what -- has Impact come down?

No, Impact we took a slight increase on -- again, we’re looking for growth in Impact this year again. Although I don’t think we’re expecting to grow by the third, but we do expect it to grow by maybe half of that. And so that’s -- that we have to deal with quite a bit of inventory sitting in the channels last year, so we’re kind of looking for nice pump here, this year for actual sales for us.

And pricing you said have [indiscernible] for Impact even with perhaps other herbicide, pesticide down?

No, I haven’t seen that. Again, if you go through that model of what a corn grower might stop herbicide is the last on the list to go. So, I think again we feel our product is the safest product on the market and we enjoyed this relationship with Monsanto, tying it to Roundup. They’ve done an excellent job with their Roundup and they pretty much sell out each year. So it’s been a nice program for us.

Okay. And then, Bob, again welcome and look forward to beginning to know you as well. I’m just wondering if you can talk through kind of what your plan and the focus on first, where do you see the lowest hanging fruit [technical difficulty]?

Yes. Thanks, Brett. Lowest hanging fruit is the upcoming season, just making sure that we target those opportunities that Eric mentioned in his preview. So I mean that's going to be the lowest hanging fruit is just things like the Section 18, Section 24, the Mocap opportunity et cetera.

Our next question comes from Jay Harris with Goldsmith & Harris.

Eric, I wonder if you could give us some color on the early order season when in December versus ’13?

Well, we had a stocking program at the retail level at December. I think it was December 31st. And there is another stocking hurdle, March 15th. I think our -- where we had identified the demand should be there, we had our customers step up, there were some that we’re looking for buying the same that we played last year, looking for discounts and something again that we try to steer away from. So I would say, up slightly from 2013, but -- so I think that’s probably about where we Roundup.

And what -- can you say anything about how the first two months of the quarter -- this quarter are going relative to last year?

Well, last year again we didn’t feel that strong as we’re moving along, because we knew -- that’s when we figured out, I guess, in that first two quarters -- two months that we have this inventory overhang. I think we’re faring on similarly to last year of where we were this year. I mean, just taking a look, yes, so right. So we will see when we hit the March15 timeframe, a couple of weeks, how well our retailers are pulling position. I think the EDI is tracking well. But again, I think we’re seeing our customers -- I mean, they’re making sure that their inventories are down as far as possible.

They’re holding two way sort of order when the retailers order kind of thing?

Correct. Right. I think they want to ensure that -- they don’t have -- again, now that they know that there is plenty of inventory there, there was not the incentive for them to stock large quantities and I think a lot of them are sitting on large volumes of fungicides, certainly -- probably more than what is needed for this year.

Turning to the balance sheet, if you meet your targets for the year, what kind of debt reduction should we anticipate by December 31?

The number I don’t have in front of me.

Okay.

Well, could you wing it a little?

So while you’re thinking that, I would say this would be short of making any acquisition. So assuming we don’t …

Right.

Yes, we’re expecting some reduction in debt in Q2, particularly, because we get the crop terms coming in on June 15. So I mean just winging, I think it was down maybe $20 million from where we’re at the end of this year.

Yes, I mean, if we hit our targets on unless it just pick the midrange and say we’re at 135 on inventory, that’s $30 million right there. So …

Plus I presume the earnings will exceed the capital investment, right?

Yes. So, yes.

All right. And then, finally, I would like to talk a little about international. What were the dollars of international sales in ’14?

I think [indiscernible] 70 …

25% on two [indiscernible] just give me a moment.

Well, all right. That’s little less than $75 million.

Actually 73,706, so $74 million.

All right. With the existing product line, just looking at the existing product line, what kind of growth rate is that capable of generating with and is the product line bold enough to make significant new distribution relationships?

What you mean by significant new distribution relationships?

Well, I presume part of the way of growing this is to get additional channels of distribution going and also to -- in the current international array of use -- grow that participation as well.

Right. You’re talking about international sales?

Just international, right.

Okay, okay. Yes, so Bob has pretty extensive international experience and of course [indiscernible] does as well, so I think the two of them are hurdling with the team and figuring out some additional relationships that we may be able to take advantage of. We have got lot of interest in SmartBlock as we get that registration and we’ve got some very nice names of people that want different parts of the world to distribute that product. So that will probably open up some channels. I think one of the things that -- Again, Bob and [indiscernible] are working with this. We have a number of registered products in Brazil, but we’ve not really got a platform of moving forward. So that’s a kind of an area that they’re focusing on to figure out how do we take the products that we’ve got registered and how do we get those through the channel? We had BASF moving a couple of our products, but as it turns out we have had more registrations of different crops and different products than we’re aware of such as Aztec. And so, that’s an area that I think has some great growth opportunity for us.

Would the goal be to get those revenues -- those start growing at 10% a year?

Well, mine with -- my goal is on growth at 15%. I don’t know when you talk to the international team there, they’re saying we need acquisition to make those sort of thing happen, but that includes acquisitions, so yes.

Okay. All right. Thank you very much.

Sure.

Our next question comes from James Sheehan with SunTrust Robinson Humphrey.

Good afternoon. Could you quantify what's the fixed cost headwind was in the fourth quarter and what do you expect it to be in the first quarter of ’15?

The question was what was the fixed cost in fourth quarter and what do we expect that to be in first quarter of ’15?

The fixed cost, the operating cost?

Unabsorbed.

Oh, the unabsorbed.

Are you talking about unabsorbed?

Yes, correct.

The unabsorbed.

Unabsorbed fixed cost, yes.

Right.

$4 million.

That was $4 million in one quarter?

Yes, [indiscernible] time yes.

Right. And I think we’re targeting to reduce about $10 million for the year -- year-over-year.

Right. And Q1 tends to be slightly better than Q4, because it's when we are tend to be producing for the season. So perhaps a little over than the $4 million.

Okay.

Thank you very much.

[Operator Instructions] Our next question comes from Bruce Winter, Private Investor.

Yes, thank you. Your long-term debt is up by a lot. You covered the increasing receivables; you covered the inventories, about the other half of that is in the liability side, accounts payable and accrued expenses type things. Could you go over the liability side of the equation in the similar detail as you did for the asset side?

Yes, I mean, the big elements in the liabilities are accounts payable as you mentioned and that is really down a little bit because of the level of manufacturing particularly in the last two weeks of Q4. So that's why that's down. If you go back to ’13, we were still producing at a higher rate at that time. Our program costs are about the same level to where this time last year. Those are main items really.

Accrued expenses of $4 million to $5 million?

They’re down, right, $4 million to $5 million.

Yes, $4 million, $5 million, yes.

Part of that is tax liability.

So you were talking about like $20 million of decrease in accounts payable because of …?

Yes.

That’s a lot for …

Yes. It could just be the flows of certain inbound raw materials like Topramezone at that time.

Last year?

I have to look at exactly what the floating was in the $40 million.

From 2013?

Yes.

Yes, so that’s our Impact coming in fourth quarter last year that we didn’t have come in this year.

That will normalize soon or later, I guess.

Yes.

Right.

Okay. That’s a big debt reduction right there?

Right.

The other -- the only other question I have is could you run through how all this stuff with corn -- affects your SmartBox business?

Well, the SmartBox again is not -- the unit themselves is not a profit generator. It does generate revenue, but its not something -- again, we’ve got more of a razor-razor blade model. We do try to not lose money on it, but as far as sales of new systems, as I said equipment was at the top of the list for budget cuts and so our SmartBox sales are down this year versus last year.

Okay. Thanks for answering my questions. I appreciate it.

Sure.

Our next question comes from Tom Willingham with The Hampton Group.

Hi. Thank you for taking my question. You’ve mentioned in the call your efforts to streamline manufacturing cost and your operating expenses to match the decreased demand. Given the market uncertainty and especially in the granular soil and insecticides, have you taken any steps to improve your supply chain responsiveness, especially in the areas within your control and try to litigate the risks of rebuilding product?

Well, we have. Again, part of our -- again our biggest inventory is obviously the corn, corn soil insecticides and those are products that we do make ourselves. So during this -- during the last -- really six months what we’ve done is we’ve automated the system, so that we can produce more with quite a few less employees. So I think a shift that used to be 18 to 20 people is now 7 to 8 people. So I think our response time as we see demand move going forward, we will be able to react quicker to upsides and surges that we see. So that's kind of probably one of the main steps that we’ve done.

And one of the prior conference calls, you’ve mentioned I believe some potassium [ph] increases, are you continuing to expand potassium [ph] to match the surge capacity needs, at the beginning of the season?

No, we are -- I think as we stand right now, we think we’ve got adequate capacity. We are focusing more on bringing some of the intermediates and products that we’ve had told for us on the outside, we’re bringing those into the factory in order to utilize the additional capacity that we’ve right now. If we saw big surge going back the other direction and we certainly could use toilers [ph] again to handle that increased demand. But right now we’re focusing on utilization of our current assets.

Thank you.

Our next question comes from James Sheehan with SunTrust Robinson Humphrey.

Thank you. I want to ask about your Xpedient liquid corn insecticide. That is a lower price product than some other products in the market. And I'm just wondering if you're seeing some trade down patterns benefiting that product yet?

What we are seeing increased sales this year versus last year, but again last year it was really pretty small for us. And a lot of that had to do with the product, gets used mixed with liquid fertilizers and those are whole batter of different liquid fertilizer formulation. So I think our customer base they took it on trial basis to see how well that would mix their various portfolio and we did very well. So I think there is a fair amount of competitive material that is sitting in the channel. I think, I mean we’re -- although we’re seeing significant increases in our usage, I think there is a fair amount of material in the channel as well. So it's probably not a normalized year for the product, although those that are looking for half insurance policy or something along those lines might gravitate more towards the liquid -- less expensive liquid.

Thank you.

Thank you. Our next question comes from Chris Kapsch with Topeka Capital.

Yes, just a follow-up on this program that you have lined up with Pioneer. I’m just wondering how the economics work in terms of the incentive? Is it similar to your -- the program that you have in -- with impact on the herbicide side or if you could just explain that how that’s going little bit more? And then, also just on Impact, I think you -- I think I heard you say that, on the ground use was up 30%. Just wondering what sort of visibility you expect in terms of expanded acreage for on the ground use of Impact, if you have a line of sight to that? Thank you.

So the impact I think we’re looking at about 15% increase this year over the last years, what our estimation is currently. And as far as the Pioneer program, it basically allows the grower to have a reduced cost per bag of seed. So when they line up the seed with our soil insecticide, they get a reduction. So in that regard its, I mean, its similar type approach and that it’s a grower rebate as opposed to a rebate to the channel.

And I assume this is for BTC there right?

It is.

Excuse me?

It is for BTC, yes.

Yes, okay. Thank you. End of Q&A

Thank you. Ladies and gentlemen, I’d now like to turn the floor back over to Eric Wintemute for closing comments.