Good afternoon, and welcome to Compass Diversified second quarter our 2022 conference call. Today’s call is being recorded. [Operator Instructions] At this time, I would like to turn the conference over to Cody Slach of Gateway Group for instructions and the reading of the Safe Harbor Statement. Please go ahead, sir.

Thank you, and welcome to the Compass Diversified Second Quarter 2022 Conference Call. Representing the Company today are Elias Sabo, CODI’s CEO; Ryan Faulkingham, CODI’s CFO; and Patrick Maciariello, COO of Compass Group Management. Before we begin, I would like to point out that the Q2 2022 press release, including the financial tables and non-GAAP financial measure reconciliations, are available at the Investor Relations section on the Company’s website at compassdiversified.com. The company also filed its Form 10-Q with the SEC today after the market close, which includes reconciliations of non-GAAP financial measures discussed on this call, including adjusted EBITDA and adjusted earnings and is also available at the Investor Relations section of the Company’s website. Please note that references to EBITDA in the following discussions refer to adjusted EBITDA as reconciled to net income or loss from continuing operations in the Company’s financial filings. The Company does not provide a reconciliation of its full-year expected 2022 adjusted earnings or adjusted EBITDA because certain significant reconciling information is not available without unreasonable efforts. Throughout this call, we will refer to Compass Diversified as CODI or the Company. Now allow me to read the following Safe Harbor Statement. During this call, we may make certain Forward-Looking Statements, including statements with regard to the future performance of CODI and its subsidiaries and statements related to the impact of CODI’s updated tax structure and the impact and expected timing of acquisitions and dispositions. Words such as believes, expects, plans, projects and future or similar expressions are intended to identify Forward-Looking Statements. These Forward-Looking Statements are subject to the inherent uncertainties in predicting future results and conditions. Certain factors could cause actual results to differ on a material basis from those projected in these Forward-Looking Statements, and some of these factors are enumerated in the risk factor discussion in the Form 10-Q as filed with the SEC for the quarter ended June 30, 2022, as well as in other SEC filings. In particular, the domestic and global economic environment is currently impacted by the COVID-19 pandemic and related supply chain and labor disruptions had a significant impact on our subsidiary companies. Except as required by law, CODI undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. At this time, I would like to turn the call over to Elias Sabo.

Good afternoon, everyone, and thanks for joining us today on our second quarter 2022 conference call. I’m pleased to report that we continued our strong momentum in the second quarter of the year as we recorded our sixth consecutive record quarter at our sixth straight quarter of double-digit increases in pro forma consolidated subsidiary adjusted EBITDA, once again, enabling us to raise our 2022 outlook. We are extremely pleased with these results, particularly given the macroeconomic headwinds that all companies are facing today. We again need to acknowledge the skill and agility of our management teams and employees. Each day, it seems they wake up to face a new issues stemming from inflation or a new supply chain disruption, and each day, they put forth extraordinary effort and adjust. In our last several earnings calls, we discussed our strong execution against the tough macro environment and this quarter was certainly no different. Though inflation may be just starting to crest and there has been some improvement in certain pain points of the supply chain, we remain guarded as inflation will likely remain at elevated levels for some time and slight improvements in the supply chain could reverse quickly. During the quarter, we again delivered double-digit sales growth in both our branded consumer and niche industrial businesses. Our growth this quarter was led by BOA Technologies and Lugano Diamonds, which each had excellent quarters. BOA produced record quarterly revenues and over $24 million of EBITDA, nearly reaching its record Q1 figure. We mentioned last quarter that 1 component of BOA’s growth could be due to the elongation of the supply chain and that some demand could be the result of pull forward from future quarters. Though this dynamic did not impact the Company’s stellar performance in the second quarter, we do…

Thanks, Elias. On a combined basis, revenue and pro forma subsidiary adjusted EBITDA in both our branded consumer and niche industrial businesses grew meaningfully and continued to exceed our expectations. For the quarter, as Elias mentioned, EBITDA growth exceeded revenue growth as we were able to increase margins slightly. Our businesses continue to perform admirably throughout this unprecedented period. However, several of our companies who sell to retailers focused on mass channels did face pressure as consumers in that segment continue to be impacted most acutely by inflation. Nevertheless, our management teams continue to execute for their customers and employees, and we are able to drive considerable growth as a whole in this difficult environment. Now on to our subsidiary results. I will begin with our niche industrial business. For the year-to-date period, revenues increased by 16.8%, and adjusted EBITDA increased by 16.4% versus the year-to-date period of 2021. Arnold and Altor once again posted meaningful revenue and adjusted EBITDA growth driven by solid execution and stronger-than-expected demand. Arnold continues to benefit from investments made over the last several years in technology and infrastructure. Though the company will be comping against a very large defense-related order in the back half of this year, we are continuing to see strength in bookings and believe the company will have solid performance in the remainder of the year. Altor had solid growth, partially driven by its acquisition of Plymouth Foam in the fourth quarter of 2021. Though margins continue to be pressured by higher raw material costs at Altor, our expectations are that these margin levels should improve in the back half of the year. Turning to our consumer businesses. For the year-to-date period, revenues increased by 13% and pro forma adjusted EBITDA increased by 11.8% as compared to the same period in…

Thank you, Pat. Before I get into our financial performance, I wanted to make a few comments on Advanced Circuits, as well as our adjusted EBITDA calculation. First, ACI. As you are aware, we announced the termination of the ACI sale last week. As a result, we expect to reclassify ACI from held for sale to continuing operations in our third quarter reporting. In addition, since its operating results will be reclassified to continuing operations. CODI will get the benefit of ACI’s earnings contribution to our non-GAAP adjusted earnings metric from January 1, 2022. Therefore, our guidance, which I will discuss later in my remarks, has been updated to reflect ACI’s full-year of adjusted earnings contribution. Now on to the adjusted EBITDA calculation. Effective this quarter, we are no longer adding back management fees to our adjusted EBITDA calculation. The impact of this change is a reduction in consolidated adjusted EBITDA by $14.9 million in the current quarter, which were the total management fees expense in the quarter. Of this $14.9 million, $1.5 million was incurred by our subsidiaries. Please note that this amount excludes ACI as it was in discontinued operations at June 30. As you will hear in our consolidated subsidiary adjusted EBITDA guidance shortly, we have updated it to reflect this calculation change. In addition, our current year reporting periods and prior year reporting periods have been adjusted to reflect that management fees are no longer added back to adjusted EBITDA. And for clarification, this calculation change has no impact on our adjusted earnings calculation since all management fees are deducted. Moving to our consolidated financial results for the quarter ended June 30, 2022, I will limit my comments largely to the overall results for CODI since the individual subsidiary results are detailed in our Form 10-Q…

Thank you, Ryan. I would like to close by briefly providing an update on the M&A market and on our ESG-related activities in the quarter. M&A activity remains somewhat below historic levels, though it has picked up slightly in the second quarter. Potential sellers remain somewhat hesitant to begin processes given the economic headwinds and the macro backdrop. We anticipate activity continuing to increase modestly in the back half of the year if these headwinds start to moderate. On the ESG front, we have had a productive quarter developing and implementing our mission, vision and values in an effort to strengthen our corporate governing purpose. It is our goal to continue to build and strengthen our culture of trust, transparency and accountability necessary to deliver long-term results. Our MVV process has enabled the creation of a clear pathway for the growth of our ESG framework, which has been strategically developed to deliver an environmental and social focus areas underpinned by good governance. We expect to have the Compass ESG framework formally approved by the CODI Board of Directors in the next quarterly Board meeting, and it will be publicly shared upon Board approval. In addition, we are developing a set of core metrics and minimum standards to be tracked by each CODI company to enable consistent subsidiary measuring and reporting to enable us to develop accurate metrics for continual improvement. Our longer-term goal is to be able to integrate impact reporting into our public disclosures. Lastly, we are continuing to develop policies and programs that create an inclusive and healthy working environment that inspires people to do their best. Our focus towards diversity of people and thought has introduced new perspectives, skills and approaches to problem solving that enhances our strategic and operating capabilities. We believe that this focus is an indicator of a commitment to building a high-performing, purpose-driven workforce and inclusive culture. In this last quarter, 50% of our new hires at Compass Group Management have come from diverse backgrounds, and we recently added 1 new female Board member as we are pleased to announce the appointment of Teri Shaffer to our Board of Directors on July 2. In conclusion, it was a great quarter for CODI. Relative to our expectations, our performance was once again outstanding. As gross domestic product shrank for the second consecutive quarter, we once again grew revenue and adjusted EBITDA by double digits. Our management teams and employees continue to put forth incredible effort, and I would like to give thanks and recognition to all of them. With that, operator, please open up the lines for Q&A.

Thank you. [Operator Instructions] Your first question comes from Cris Kennedy, William Blair. Please go ahead.

Good afternoon and thank you for taking the question. Elias, you guys have been acquiring faster-growing businesses over the last couple of years. Can you just talk about the long-term growth profile of Compass today versus maybe two or three-years-ago?

Sure, Cris. And good afternoon to you, and thank you for the question. We have, if you look back over the last few years, and if I go back to pre the pandemic in 2019, if you remember, we sold a couple of businesses, which were one of which was relatively slower growing and cleaner, very good business, but kind of grew GDP. And then in 2021, we sold another business Liberty Safe, which was also a relatively slow growth business. And so through that through the sale of those businesses, and then the acquisition of BOA, Marucci, Lugano and now PrimaLoft, what we have seen is the portfolio composition has changed really dramatic with respect to our core growth rate. And I would say before, we used to talk in the context of we are a slightly stronger than GDP growth company. Now we believe we are kind of a high single-digit type growth company, potentially a low double-digit growth company at the adjusted EBITDA line. And that is a subsidiary adjusted EBITDA pre deduction of management fees. Just to be clear here, Cris, and as we have defined new adjusted earnings metrics, we do get quite a bit of leverage on growth. Our management fees, as you know, principally don’t grow unless we do acquisitions. So if we think adjusted EBITDA at the subsidiary level is growing kind of high single-digits, there is a leveraging up of kind of the corporate EBITDA, which deducts management fees because that expense stays flat. And then as you further know, we locked in all of our debt prior to the increase in debt rates that happened at the beginning of this year. And 1.3 billion of our debt in the bond market is locked in at 5% and 5.5%, respectively. And now we have just a small amount for PrimaLoft, we have a $400 million term loan that is floating rate, but the spreads are relatively low on that. And so if you think about just the amount of fixed expenses that we come underneath, including interest and management fees, we think that high single-digit growth rate of subsidiary adjusted EBITDA should leverage into strong kind of growth rates and adjusted earnings just based on how the math works. But I think largely one of the things that we are demonstrating right now and may have been not as apparent to the market is that the core growth rate of this Company has absolutely accelerated as we have engineered this portfolio transition by buying faster growth businesses and shedding some of our slower growth businesses.

Great explanation. And then just one last one on the health of your consumer, I know CODI generally has higher end consumers, but just there is a lot of uncertainty out there. But just talk about the health of your consumer and your ability to pass through inflationary pressures on your consumer?

Sure. So I would say just, and I will give kind of an overall macro view of what we are seeing. And frankly, our guidance is very much tempered based on some of the headlines and this change in Fed posture, we really haven’t seen in a very long time of Federal Reserve that has been as aggressive as it is and is projecting to be kind of further aggressive going forward. And so the overall uncertainty, Cris, just that exists in the marketplace right now has caused us to really temper expectations. Now all that being said, we generally see demand as staying strong. I would have said a quarter ago, we see demand really more at a torrid level. And so I think it is kind of down shifted a little bit. But part of what we think is happening is there is a more normalization of inventories throughout the supply chain right now. So some of the initial orders that are coming in can be reflective of that. And so as we have all heard, customers, our companies have really expanded their inventory positions, and there was an elongation of the supply chain. I would say broadly, we are now seeing companies start to shrink their inventory position. And it really doesn’t matter whether you’re at the low end, the middle end or the high end of the marketplace, we are just seeing that broadly. And that is starting to bring down slightly what the new order flow coming in, so we do think there will be some inventory adjustments that generally weighs a little bit on what our revenue growth looks like and otherwise would be without that normalization. Now on the other side, I will say we are also starting to see some moderation in…

Great. Thanks for taking the questions.

Thank you, Cris.

Thank you. The next question comes from Larry Solow of CJS Securities. Please go ahead.

Great. Good afternoon guys. Just a couple of follow-ups to that. On the price increases, which I know a lot of your businesses certainly have pricing power as leaders. Have you found it increasingly more difficult to continue to raise prices or have you seen some pushback from customers or some elasticity as you continue to raise price. I’m just trying to get a feel for that. And have you also - are there other workarounds have you be able to maybe increase suppliers in some instances or I know you’ve been building inventory outside of Lugano, but in other places where you normally don’t hold as much inventory. So just trying to get some idea on some of the workarounds.

Hey Larry, this is Pat. I would say, holistically, what we are trying to do is provide value to our customers. And so product A, maybe - product line A, you may be able to raise prices a little bit more than product line B. We had sort of the - what I will call the hatchet raise and now further raises are more scalpel as you will, kind of looking at what products are really sort of underpriced relative to the value that they convey to the customers. We have a diverse group of suppliers that we have at each business that we are constantly looking for the best prices on. And then as Elias mentioned, we are seeing certain sort of COGS related items moderate freight costs are down. That was a big driver. I mean they are still significantly up from year ago levels, but freight costs are down. Gas energy is down. So we are seeing some of that, which is also starting to maybe, I think that is why Elias said used the term cresting because it is kind of starting to see that cresting. So that is sort of where we are now in kind of a state of play. Does that make sense?

Yes, absolutely. Just specifically on Lugano, do they sort of benefit or maybe not really get impacted inflationary environments on diamonds? And I would also think to people that the audience these are being sold to. Does this type of environment. Obviously, the performance doesn’t seem to be impacted them, but I know it also seems like the more you invest in working capital, it is almost like the more you can earn. So just trying to maybe that is not quite true, but so does the inflationary environment actually hurt Lugano or maybe actually benefits them?

I think if it benefits - so a couple of things. First, as diamond prices go up, it is good to have a lot of diamonds. So that is number one. Second, I would say, it is probably - I mean, I know all of us as we see inflation, we look to hard assets as stores of value. And their pieces are beautiful. Their pieces of art, but there is also sort of a very large hard asset sort of component of it. So in that way, I do believe there is strong demand, and we have seen it from competitors, kind of strong demand for all for many sort of ultra high-end retail. those. So it is kind of ultra-high-end jewelers. So it is kind of both pieces, if that makes sense. We don’t mind it. And I would just add that because of Lugano’s business model that we have talked about, we think we are providing, again, more value to our customers than any of our competitors because of some of the ways that team there has been able to disintermediate and purchase.

Okay. No. Fair enough. And just lastly on 5.11, I think you guys mentioned revenue is up close to 7% year-to-date and EBITDA sort of flat, just more supply chain issues. Were those supply chain issues more front-end load? I thought that was, a lot of that was in the beginning of the year, and hopefully, some of that is waning for 5.11. And then on the other side of it, on the revenue side, I think you mentioned the direct-to-consumer side is still doing really well. How about the professional side? I would feel like that, it feels like more dollars are going into that these days than maybe a couple of years ago, but maybe that is just perception, but any thoughts on that?

So we are seeing the, and I think we had stronger performance in Q2 than in Q1 at 5.11. And I think we touched on last time that in March, we really saw kind of the really critical like not getting any inventory in issues sort of abate. But there is still a lot of acute issues. I mean you heard about the trucker strike in the L.A. and the Bay Area ports. Well, that cost some revenue as we weren’t able to get products shipped in, if that makes sense. And then on professional side, our professional business is very strong, and we are seeing strong professional demand. And I think some of the sort of pullback that we witnessed post-pandemic in sort of people’s appetite to support local and international professional market has mitigated, and they have realized that they need that they need to catch up. And so we are seeing really good professional demand. Where we are seeing some weakness is in wholesale, which is a smaller component of our business. But if you remember, 5.11 does have some wholesale business, nonprofessional consumer wholesale business, which is facing same sort of inventory.

Same retailer. Yes. Yes.

Yes, that is what you hear about it, right. And so there is some of that. And I would say e-com and DTC continues to be strong. I would say e-com is not as is moderating a little bit from year ago levels, but I would say it is still strong in putting up respectable numbers.

Great. I appreciate all the color. Thanks Pat.

Thank you. The next question comes from Matt Koranda of ROTH Capital. Please go ahead.

Hey guys it is Mike Zabran on for Matt. In terms of 5.11, could you just comment on your comfortability with the current store count in relation to your initial rollout expectations? And then from there, has the ability to get inventory improved at all since last quarter or are we still experiencing some headwinds on that front?

So I think we have 94 stores now. We will be opening a number of stores in the back half. I think if we said we were going to do 25 this year, I think we will do 20 to 25, one to two a month. I think the back half is more loaded than the front half. So look, I would be looking forward in the next several months to the press release of our 100th store. And again, those stores are continuing to perform well. What we have seen, and we have seen improvements in the receipts of inventory. But again, if you say it took two months to get from factory to 5.11 before, it is still, we still are budgeting in sort of three or longer, right? It is just that, that elongation has happened, and our inventory has expanded sort of because of that. But yet that elongation has stayed constant or maybe improve slightly a day or two here or there, if that makes sense. We have not yet started to sort of reduce those levels and pull back on our order time and being able to order kind of closer to when we need it, if that makes sense to shrink the inventory. We are not yet in that phase of the recovery, but we are able to manage our inventory better because that the kind of - the elongation has stopped getting longer if that makes sense.

Yes, absolutely. That is helpful, thank you. And for Marucci, could you just comment on the demand environment and help us understand what’s really dragging our margins here?

Yes. I mean a couple of things. First, Marucci, like everybody else, and we touched on it, had some air shipments and those air freight, as you know, get put in inventory and average out over time. We have seen that improve. We expect margins to improve significantly in Q3. And I would also say we feel demand is good, preorders were good, and we feel demand is good for this sort of next line of bats and accessories and clubs. We are making inroads, and we think those roads will continue in Q3. Really, we are comping against a smaller launch last year, I believe it was the CAT 9 past time that we didn’t kind of replicate this year above the, before the CAT X. So I would expect a much better Q3 than Q2 at Marucci.

Right. Okay. Got it. And last one for me. In terms of the M&A environment, maybe just speak to how comfortable we are pursuing any additional tuck-in opportunities in the near-term, and maybe just comment on private market multiples and how they have changed quarter-to-date?

Yes. So as Ryan mentioned in his section, pro forma for the PrimaLoft acquisition, we are right around four times leverage right now. It is well within sort of what is tolerable and given kind of the growth of the portfolio, which I talked about earlier and the increased core growth rate the free cash flow that we generate, pre-making investments, whether in growth CapEx or working capital, we are just in a very different position that allows us to have leverage that is above our target leverage. But to be clear, we are above our target leverage. As we have set out there, our target leverage is kind of three to 3.5 times, and we sit 0.5 turn above the high end of our target. So our goal is to reduce our leverage back to within our target leverage. We feel that is a responsible amount of risk for us to have in our balance sheet for our shareholders. and it gives us the flexibility to run our business well. Now I think there is a few ways to get there. Clearly, the ATM that you guys are all aware that we have in place allows us to get equity capital into deleverage. But on top of that, just growth in the portfolio increases the denominator and that is deleveraging in and of itself and free cash flow will as well. So we think that those three components growth cash flow from operations and ATM will get us back within sort of our leverage window in a relatively short period of time, and that is why we are comfortable at where we are right now. Now that being said, I think for small tuck-ins, we are still open for business. And generally, those are at more better purchase price…

Very clear. Thanks guys. That is all for me.

Thank you.

Thank you. [Operator Instructions] The next question comes from Barry Haimes of Sage. Please go ahead.

Thanks so much. Great quarter once again. I had two questions. One, the financial market has only recently gotten a little better, but I’m just wondering, is there a set of circumstances where you would go back to the notion of a 5.11 IPO? And second question, I wonder if you could give us a little bit of an update on the health care initiative you guys have talked about. Have you built out the team? Are you starting to look at acquisitions yet. So just a little of an update there.

Sure, Barry. Thank you for the question. So first, with regards to 5.11, what we have said on numerous occasions, and we will continue to say 5.11 is a great business. And this is one of the, as companies that we have in our portfolio. We are fortunate now to have a number of kind of A type businesses, 5.11 being kind of the one that we have had longest. We are happy holding 5.11 as long as necessary because it is going to provide great growth tailwinds for our shareholders and tremendous shareholder value creation, whether it is owned 100% or whatever we have a minority interest there or whether we have a component of that, that is publicly floated. Now that being said, this company has done a lot in order to make itself a publicly viable company. From the creation of an extraordinary management team with great systems that they have in place. And the underlying elements, whether it is working on ESG, whether it is working in a SOX compliant environment, the company has the systems and the talent to be able to be a public company and it has the growth opportunity that public investors want. So it naturally should be a public company. We do not view ourselves as needing to force it out into the public markets before they are accommodative. And so as markets become more constructive, as we see the consumer businesses, which still are trading relatively poorly, especially if you look at a lot of the consumer IPOs that occurred late in 2021, mid- and late 2021, they have performed incredibly poorly. That is just creating a really kind of negative backdrop still for consumer companies to go public. And I would say a company of this ilk, we don’t feel a need to try to get it out there unless the markets are going to be very accommodative and reward our shareholders with the type of multiple this company deserves. And so are we always evaluating whether this company is ready to go back and become a public company? Absolutely. Do we think right now conditions, even though they have moderately ticked up financial conditions in the last month or two? Do we think now is the time? Not yet. But as you know, financial markets can change rapidly. The tone of financial markets can change. If we see headline inflation start to really come down, and the Federal Reserve change its policy stance and that creates the next kind of bull run in the market, then 5.11 will be ready. And at that point, we will make a decision because we do view this eventually is becoming a public company. And so - I’m sorry, your second question that you had asked.

Health care.

On the health care initiative. Yes, we continue to advance along on health care. It is an important initiative I would say there is some candidates that we are in talks with. As you know, this is predicated on getting a leader who will be in and can direct that effort for us. And we are feeling more confident by year-end that we will have some positive news to announce there.

Great. Thank so much.

Thank you. The next question comes from Matthew Howlett of B. Riley. Please go ahead.

Hey guys. Thanks for taking my questions. Did you note any FX items on the earnings or the guidance here?

Do you say FX? No, no FX Matt.

Okay. Nothing with the strong dollar is not going to have any impact or I mean there is nothing to note there with the dollar strength at all?

You don’t adjust that out. You are not adjusting that out. No, we don’t adjust that out. There is some impact. It is pretty modest across the group of companies. So it is, yes, so it is technically factored in as part of our guidance is a way to think about it.

Okay. Got you. Good. Okay, good. Second question, on Sterno, there was a nice pickup there. I know you had some, on the two divisions, was it just that the heating lamp with the sort of return to a conference schedule or was it the other division with the catalyst, was there any sort of -- any reason for the pickup there?

I would say the strength in Q2 was definitely driven by the Sterno side of the business, the core Sterno kind of the party and the getting outdoors and the buffet set as I think people are making up for weddings that didn’t happen over the last couple of years and parties that didn’t happen over the last couple of years.

Okay. Yes. Any update on sort of the other side of the business, I know there was some, with Walmart, some of the inventory issues. Anything there?

I mean I would say, not performing as strong right now at this moment as the other side of the business, performing fine, taking all necessary actions and it kind of goes into some of the things we said before about kind of the more cost-conscious consumer being pinched a little bit by inflation.

Got you. Okay. And then real quickly on Lugano. I mean the -- you said two more salons, I mean, any sense of how we think about modeling sales with these additional salons coming on?

Let us think through that. I don’t think we have a good answer for that right now. I mean -- and the short answer is, the salons vary. Salon can vary materially in the sales level they have. So I think we are hesitant to put out sort of salon level guidance.

Got you. Okay. Well, they certainly have a great big following. So it would be really interesting to -- could obviously have a really meaningful impact that these are successful. We will look for that. And then remind us again, the Marucci - the new bats - interesting, how often do they introduce a new bat like that? You could just go over or is it once a year or is it once every two-years?

Yes. So the big launches like the CAT X, CAT9, the big sort of Marucci level launches tend to be once every two-years. I would say there are sort of incremental launches or slightly smaller launches that we have in between. So Victus, our sister company, launched the NOX, I think it was last year, last year. Last year, we came out in the summer with the CAT9 Pastime, which was a different design sort of version of it. And then there is, also right now, markets that are launching, we launched the globe a whole glove line. But it is the big bat launches we have launched softball lines with the echo. But it is a big, it is the big sort of Marucci bat launches that provide the lumpiness. And for those, it is usually every two-years.

Okay. Got you. Okay. So okay. So this is going to be a third quarter event, right, to sort of -.

Yes. We have a launch in the third quarter. It is going well. We should have a good quarter.

Great. Wonderful. Great I really appreciate it.

Thank you Matt.

Thanks Matt.

Thank you. There are no further questions at this time. I would now like to turn the conference back to Mr. Sabo.

Thank you, operator. As always, I would like to thank everyone again for joining us on today’s call and for your continued interest in CODI. Thank you for your continued support.

This concludes Compass Diversified’s conference call. Thank you, and have a great day.