Good day, everyone, and welcome to the Third Quarter 2024 Minerals Technologies' Earnings Call. Today's call is being recorded. At this time, I would like to turn the call over to Lydia Kopylova, Head of Investor Relations for Minerals Technologies. Please go ahead, Ms. Kopylova.

Thank you, Sheley. Good morning, everyone, and welcome to our third quarter 2024 earnings conference call. Today's call will be led by Chairman and Chief Executive Officer, Doug Dietrich; and Chief Financial Officer, Erik Aldag. Following Doug and Erik's prepared remarks, we'll open it up to questions. As a reminder, some of the statements made during this call may constitute forward-looking statements within the meaning of the federal securities laws. Please note the cautionary language about forward-looking statements contained in our earnings release and on this slide. Our SEC filings disclose certain risks and uncertainties, which may cause our actual results to differ materially from these forward-looking statements. Please also note that some of our comments today refer to non-GAAP financial measures. A reconciliation to GAAP financial measures can be found in our earnings release and an appendix of this presentation, which are posted on our website. Now, I'll turn it over to Doug. Doug?

Thanks, Lydia. Good morning, everyone, and thanks for joining today. Let's go over a quick outline for today's call. First, I'll provide a quick review of our performance highlights for the quarter, and then I want to spend a few minutes reviewing the progress we've made with a variety of key initiatives and business development activities, as well as run through some highlights and key takeaways from our Investor Innovation Day that we held in September. Erik will then take you through the detailed financials for the quarter. We'll try to keep our prepared remarks a bit short of this call, so we have more time for your questions. Let's start with our Q3 highlights. This is a record third quarter for us and we're on track for another record year. We did experience a general slowdown across our industrial markets this quarter, primarily in the Engineered Solutions segment. But this softness was offset by growth in our consumer-based businesses. This is the balanced structure of our portfolio that I often refer to, and it continues to prove that it can deliver solid results through a range of market conditions. Despite the softer conditions in our industrial markets, operating income was a record for the third quarter, and both gross and operating margins remained strong, reflecting the increased profitability we are driving across the company. Price improvements, higher sales of our newest products, input cost-savings, and productivity improvements all contributed to this performance. Operating cash flow increased over last year and our balance sheet is in great shape. We have broad opportunities to invest capital in ourselves, both to support our organic growth and to capture manufacturing cost improvements in our facilities. With debt leverage at our target levels and with our free cash flow generation of around 7% of…

Thanks, Doug, and good morning, everyone. I'll begin by providing an overview of our third quarter results, followed by some detail on the performance of our segments, and I'll wrap up with our outlook for the fourth quarter. Following my remarks, I'll turn the call over for questions. Now, let's review our third quarter results. We delivered another strong quarter. Our results represented third quarter records for operating income and EPS, excluding special items. Third quarter sales were $525 million, down 2% from last year on an underlying basis as growth in Consumer and Specialties was offset by lower sales in Engineered Solutions. We experienced a slowing of industrial market activity in the third quarter, and you can see how that impacted our high-temperature technologies and environmental and infrastructure product lines in the sales bridge on this slide. In the operating income bridge, the volume and mix impact reflects this market softness, which you can see we more than offset with continued pricing improvements and cost performance. Selling price increases totaled $3 million versus the prior year, which translated to 40 basis points of margin improvement, and cost improvements contributed $6 million in higher income and 120 basis points of margin improvement over last year. Our teams continue to manage costs well, delivering a strong mining and productivity performance, and we're realizing the benefits from the cost-savings program we implemented last year. Altogether, third quarter operating income rose by 3% versus last year to $79 million, and operating margin increased by 100 basis points to 15.1% of sales. Earnings per share was $1.51, excluding special items, up 1% from prior year, and finally, our cash flow remains strong with $60 million in cash from operations in the third quarter. Now let's review the segments, beginning with Consumer and Specialties. Third…

[Operator Instructions] Our first question is coming from Daniel Moore with CJS Securities.

Thank you. Good morning, Doug. Good morning, Erik. Thanks for taking the questions.

Hi, Dan.

Hi, Dan.

I'll start with prepared remarks. If I heard right, I think you said you mentioned your end-markets and new products set you up well for mid-to-high single-digit growth next year across Consumer and Specialties. Did I hear that right? Number one. Number two. Can you break that down a little bit by category and what are the key new products or innovations that give you that confidence?

Yes. So the comment in the remarks was in reference to household and personal care. And the fact that the growth was, I think low-single digits in the third quarter and October is looking pretty strong for pet care, and we feel good about the fourth quarter and heading into next year. And generally, we've been seeing good growth out of that Consumer and Specialty segment and in particular, the household and personal care product line. It's not just the pet care, but it's the high-margin specialties that we're talking about, the bleaching earth, edible oil purification, renewable fuel purification, personal care, fabric care, animal health. There's a lot of product lines in there that we feel confident about. And so that's what the statement around mid-to-high single-digit growth for next year was about.

Dan, that said, we'll take it a little further. So the high to mid-single digits is household and personal product line, but I do think that Erik made another comment that sets up the backdrop for next year could be very positive for both. Now interest rates and when -- how they'll trend down, impact, and the delay that it will take to kind of move some of these more industrial markets, especially commercial construction, which we have some projects that we know that are on the sidelines that are ready to go, this could provide a very nice backdrop next year for both of the segments in terms of growth. So we're setting up nicely in the Consumer and Specialties business and I think we could be set up nicely next year if some trends take place where we could see that revert to a growth. And for both segments going that direction, that's where we're going to revert back to that mid-to-high single-digits or at least mid-single digits for the Company.

Very helpful. Near term, how much of the slowdown you're seeing across the more cyclical pieces of the business? How much of it, if any relates to customers being cautious and working down their inventories versus actually related to kind of softening end-market demand over the next quarter or so?

Well, let me start off and then I'll give it to Brett, who is the Group President for Engineered Solutions. I think it's a bit of both. I think we're seeing -- we continue to see weakness -- and not a lot of movement at all in commercial construction. So I think that's just kind of the economic activity and interest-rate driven, and the same with some of the environmental projects -- larger environmental projects. I think in foundry and refractories, it's a bit of a difference. Brett, you want to give some color on the two product lines and what you're seeing?

Sure. Dan, from a metal castings standpoint, mainly North America, it's really the ag market demand has really softened. The third quarter declined a little bit further than the second. We have a major equipment supplier pulling a lot of production out of the market. We also saw other ag foundries take extended outages, but the core business is still okay. Reduction continues to be driven by the high interest rates, the high inventories and of really used and new farming equipment. So there's just -- it's a slowdown in the market itself. We -- in the fourth quarter, though, it's expected to hold, we don't anticipate that ag market to go down much further. And that segment makes up -- that part of the segment makes up about 15% of the total metal castings market. So in North America, automotive seems to be okay. It's holding. So we think we're going to see the similar performance in the fourth quarter. From a steel side, we are seeing some softening in the market. Utilization rates in North America are about 72%. They have been in the mid-70s, a little bit higher last year, but it's still doing well. Most of that decline is in flat-rolled steel. We are seeing the service centers reducing some inventories, and some of that's just based on softer demand and some is just for pricing and trying to get pricing back to higher levels. Our expectation for the steel production overall is similar to what I just said in foundries. We think that's going to be pretty flat in the fourth quarter and probably flat in the first quarter as well. Europe is still flat. But overall we think by the second quarter, once the election is over, interest rates come back down, we're going to start to see an increase in trajectory. So we don't feel like we're seeing any major drop like we have years past. So overall, we feel pretty good about the market and moving it forward in the next few quarters.

That's a great color. Just trying to get a sense for when it turns, whether there might be a little bit of extra boost from inventory replenishment so to speak. I think that really helpful. Last one and I'll jump out. You've been running ahead of your margin targets on a pace of 15% op margin this year. How do we think about the upside to those goals? And if so, when might you think about updating or establishing kind of new longer-term targets? Thanks again for the color and congrats on the execution.

Thanks, Dan. Appreciate that. Regarding margins, yes, we think there's some upside to our 15%. I think when we have -- let me prefer it this way. I think it's going to come from a couple of places next year. It's going to come from, volume growth and revenue growth, which as I mentioned in the two segments, I think are set up well to deliver that next year. As you know us, we keep our fixed costs relatively tight. We do have capacity in our plants to handle that revenue growth. And so I think that contribution margin is going to drop to the bottom line. That's going to be a positive. Second thing is, we are seeing acceleration in some of our higher-margin products. We've seen that all this year. Those are new products, but also some of the high-temperature technologies as they rebound from a slower second quarter or a slower second half, I think those are going to accrete to our margins going forward next year. So price-cost, you know us. If we see cost pressures, we're going to adjust pricing to keep our margins. But I think we're largely through that. We will be diligent on pricing. But at the same time, I think next year, you're going to see that volume growth, revenue growth and you're going to see the higher-margin products all accrete to bottom lines. Where that ends up next year, I think we need a little bit better look at getting through the election in the fourth quarter, what the volume outlooks outlook looks like next year, and we'll give you some targets probably at the end of the year.

Sounds great. Thank you again. Jump back with any follow-ups.

Your next question is coming from the line of Mike Harrison with Seaport Research Partners.

Hi. Good morning.

Hi, Mike.

I was hoping that we could maybe dig in a little bit on the HPC business. We've had a couple of softer quarters there. I think last quarter, we were talking about some changeovers that impacted the pet care business. This quarter, as you went through the different product lines within that business, it seemed like everything was kind of growing pretty nicely except fabric care. And I'm just kind of curious how we got to a 1% or 2% type of growth number if everything else was growing and it was really just fabric care that was soft. Can you give us some more details on what you were seeing in that business?

Sure. Let me kick it off, Mike, and then I'll pass it to D.J. to give you some more color. Yes, a couple of areas. I mean, look, this product line is still set up really well. It's growing. These are some of our newest products. Yes, a bit of a softer couple of months in pet care in the slow season, a slower than normal, but rebounding nicely. And I think the fabric care was a little bit of an order pattern change and shift largely to some of our Asian customers. So I don't think it's anything there. It's -- but these businesses have a lot going for them and going ahead. Let me give D.J., you want to take them through the product lines and what you're seeing.

Yes, gladly. So, Mike, let me address fabric care specifically then we'll talk a little bit more about specialties and then just provide you some color on pet side as well. On the fabric care, yes, a little slow, but if you look at, as Doug said, mostly that was some order pattern issues, primarily with Asia. So that will be coming back to our expected pace in this quarter and next. But long-term, I guess, if you look at that product line in general, the lineup that we've got with some of the macro trends out there on natural solutions and environmentally-friendly approaches, all those things that we're doing, we're seeing a substantial customer pull in fabric care, in particular. This trend towards dry detergents is where our expertise lies and we're getting increased requests for higher performing additives that do everything from fragrance control to go into some new products that will be further working through dry products, reducing water consumption and eliminating plastics in that line. But if you look at that broader perspective of that particular product line, bleaching earth, we still continue to get strong pull, especially from renewable fuels, and that is just a nice performing mineral in that space. Animal health, the drivers, again, are improved nutrition for especially these, let's say, the food animals, the protein source that's out there. And we're lining up with natural solutions that kind of go along with the trend of moving away from the antibiotics and those sorts of -- and GMOs. So we're really comfortable that we're in the right space for all of those items. When you look at pets, a little bit of a slow quarter, caught me a little bit by surprise on the early part of the quarter. We're seeing strong orders right now from them. So we'll see both sequential growth and year-over-year growth as we go into this quarter. Erik already highlighted those items. As we go into next year, we're seeing pretty substantial pull on some new products, new offerings that we have. That's everything from a fragrance to some new packaging, but we're also seeing some up call it private-label strategy expansion where people going upscale and downscale depending on what their particular strategies are. An upscale move would be something like a hygiene improvement, something with less dust, higher brightness or something specific for these new robot litter boxes that are going out there and the downscale would just be something that's a more competitive price offering versus an existing private-label. So we're lined up well, Mike.

Yes, Mike, the only thing I would add to that is just giving you some perspective. So a bit of slower quarter in some of these product lines, but on a longer-term basis, I think a year and a half ago, we laid out that this pet care business at the time of our kind of Investor Day, we laid out some targets for you. I think it was a $350 million business. That thing is probably going to be pushing $440 million, $450 million next year, and our target by 2027 was get to $500 million. And we are well on track, if not ahead of that. So a little bit slower summer, but with the initiatives that we have in terms of aligning ourselves with some Asia e-commerce business, some of the new products you saw in Hoffman Estates around robotic litter boxes with our new additive, all the things D.J. just lined-up, I think we're really well-positioned to not only meet that target but maybe exceed it. So on-track and I'd say it's pretty similar for the rest of the product lines in that -- of the products in that product line that D.J. just mentioned.

All right. Thanks very much. That's definitely a helpful color. And then on environmental and infrastructure, that business continues to be pretty soft, I think even though we're kind of lapping some easier comps there, and you mentioned that the lower interest rates maybe should help. But can you talk a little bit about what you guys are hearing from your key customers, what they're saying about backlog? And I'm just kind of curious, is there some pent-up demand there that could start to materialize in the next year or two, particularly as interest rates are coming lower?

Yes, sure. Brett, do you want to go through some of what we're hearing from our customers?

Sure, sure. Mike, let me just walk you through our key product lines and where we are and where we think it's going to go. When you look at our building materials, the construction market, as you know, is -- continues to be depressed due really to the economic drag we've seen throughout the world. We -- it hasn't really fully recovered from COVID, supply-chain crisis, interest rates, credit tightening. It's -- so we've been frustrated with it. But we're starting to see more stability globally and we're starting to see some extra activity. We're getting specked into several projects. But the consensus opinion is, again, when rates drop further, the political situation stabilizes, we're going to start seeing more movement. We're way more optimistic for next year in 2025 than we have been in the last couple of years, and our products are used on the front end of projects. So as these holes start to be dug on these construction projects, our products are going to are going to be there. So we are more optimistic. From an environmental standpoint, which is primarily municipal waste and coal ash, let me talk a little bit about that. The landfills -- the municipal waste, of course, continues to grow and landfills in the U.S. continue to be a large part of the EPA's waste hierarchy plan. In Europe, that's not the case. There's more incineration. Landfills will -- we'll continue to use compact clay liners, and when they need airspace, we don't -- they use our geo-synthetic liners. So those products are a key base for our business. And then in coal ash, this is a more cyclical business. Coal ash and the drilling, that has been very slow for us and that's a key part of our business. And sometimes that takes longer. There's a lot of planning stages in that. So we think that 2024 was a key planning stage and we are getting a lot more inquiries for 2025 for those businesses. So we anticipate that getting better as well. And then drilling, drilling actually has been the highlight of the environmental and infrastructure business this year. It has produced pretty decent sales and that's without the traditional heavy construction drilling. So when that kicks back in, outside of what we've been selling mainly into the electrical grid, clean water, broadband Internet, and energy initiatives, when that traditional heavy construction drilling kicks back in, I think we're going to be set up for a decent year. And then, of course, wastewater. Wastewater, we have projects ongoing in the industrial manufacturing of discharge of wastewater into municipal sewers, in city remediation and then, of course, drinking water. So there's a lot of activity going on, but unfortunately, it's been really slow and we think we're set up pretty well for some of these projects that are waiting for to be initiated.

Does that help, Mike?

All right. Thanks. Super helpful. And maybe just a quick follow-up. I think of that project-based business as being -- is having a very high incremental margin, or being a place where more activity can leverage really nicely to the bottom line. Is that still the right way to be thinking about that in both environmental and infrastructure business?

Yes, it is. I think it's -- if you look at the whole Engineered Solutions segment, it as a segment has the highest margins in the Company. And so I think from back to the earlier question on margin improvement, as you see the industrial activity around foundry, around refractories and these projects that have a high contribution, especially in the construction market, as that starts to move back in, not only that growth, but that contribution will come in and that's where we see some of that margin improvement and profit-improvement coming next year.

All right. Very helpful. Thanks so much.

Our next question is coming from the line of Kyle May with Sidoti.

Hi. Good morning. This is Steve Ferazani on for Kyle. I appreciate all the detail this morning, Doug and Erik. I wanted to ask about the upside -- upsized share buyback. Just curious if that's still a one-year term and also what related to the upsizing. Was it the greater cash conversion, the improved balance sheet? Your look at the valuation, I know the support decision, or the flip side being maybe M&A candidates out there are either still priced too high or maybe there just aren't a ton out there. Just a glass-half-full or glass-empty type question?

We're definitely, a glass half-full here. But Steve, thanks for the question. Let me take it back to just kind of our capital allocation policy. Generally, when we're at -- when the balance sheets where it is now and our leverage is around 2 times or below and as Erik mentioned, we're 1.7 times, we like to steer capital back to shareholders. 50% of our free cash flow on average goes back to shareholders each year and the other 50% we like to keep on the balance sheet for opportunistic M&A. We did finish -- so on $150 million, $160 million [ph] of free cash flow, $80 million a year, $75 million -- $80 million a year. We did that this past year through a $75 million share repurchase and dividends. I think totaled about $96 million back to shareholders -- $95 million back to shareholders. Going forward, we see the growth, we see improved margins and we see improved cash flows. And I think that supports both that capital allocation strategy and additional inorganic opportunities if they arise. So we did that through this time a $200 million share repurchase initiative. There's really no timeframe on this one. It's not a one year, but we plan on purchasing those shares, gives us a little more flexibility through that kind of 50/50 balanced allocation of capital, okay? So we'll be doing that over the next year -- two years -- two to three years, probably finish that program up, but we'll see how that goes. And we also saw that with that kind of increased cash flow the Company is generating with the forward sales projections and the positions we're in with the confidence to -- we doubled our dividend last year, but now add another 10% to that. So I think with our financial strength, it gives us a lot of options and flexibility to both keep the balance sheet in great shape, increase the dividend, repurchase shares and at the same time, as you mentioned, we still have retained the opportunity for M&A. So it's not one or the other. It's not give share repurchase or M&A. We think we can do both.

Thanks, Doug. Can I ask about the AI applications to the mining processes? I'm assuming if you're making these investments -- I know you highlighted worker safety, but if you're going to make these investments, I'm assuming you see some margin-enhancing potential. I think you talked about productivity, and I know you're in the early stages. Is that the goal that you think that longer-term, and what would your confidence level be that those could contribute to margin enhancement?

Yes, I think so. So over the past couple of years, we've been working on -- I highlighted this one just because I did want to -- we just came off of an Innovation Day on products and innovation around new concepts, and I wanted to highlight that it's deeper than that. Those were my comments. We are looking at tools -- AI tools, but other tools, just that we use every day in our operations. And here was one that we felt that was very interesting the way out to announce. And the reason this one is important is because, yes, there are some direct savings and efficiencies in fuel, but more to that, it can help us use equipment when we typically wouldn't use it. So this is helping with safer operations because of ways of running that equipment in sometimes challenging circumstances with our employees. But also if weather -- inclement weather at night, these are not times where we're going to be running that equipment. It's not safe to do so. But this gives us the opportunity for asset utilization improvement, which ultimately will be a long-term cost savings. So it might not be a huge margin improvement. Our mining folks are fantastic at what they do, but being able to use this equipment on a 24/7 basis is a big thing.

Excellent. Okay. Thanks for that, Doug. Last one for me on FLUORO-SORB. You talked about some progress on those eight pilot programs. Can you talk about when we can actually, move to an implementation phase? Is that going to be driven more by the success of those programs, or the regulatory requirements timing-wise?

Well, we're already in the implementation stage. I guess it's just a matter of trajectory and timing and adoption from the marketplace. We are in four drink utilities already -- I'm sorry, I just got saying, we're in six utilities already by ourselves removing PFAS from water. So we're already implementing that. I think the engagement with the EPA is really we're already validated as a very high-functioning PFAS removal agent. What this is doing is, having the EPA kind of utilize the three technologies, primary technologies that are out there, ours being one of them in eight studies. Now I think that will just add to the confidence level of FLUORO-SORB as a very effective PFAS removal media and will likely accelerate its adoption. It will give utilities the confidence that this is a good solution for PFAS and I think it will accelerate it. Now regulation in the utility is really not going in until 2029. It's not to say that water utilities are waiting. So it will ramp up and it will ramp up as we get closer to that. And we're also working in environmental remediation, groundwater capping systems as well. So it's only one element of PFAS removal is drinking water. We have other environmental water cleanup projects as well. So we're already in the implementation stage, Steve.

Excellent. Great. Thanks so much, Doug.

Thanks, Steve. Appreciate it.

Our next question is coming from the line of David Silver with C.L. King.

Yes. Hi. Good morning.

Hi, David.

Hi, thank you. I think the first topic I'd like to go at is kind of the cost performance this quarter. So looking at Slide 8 bottom right-hand corner, but Erik highlighted about the $6 million benefit at the operating income line year-over-year, and I'm just wondering -- I mean, I do see prices up marginally as well. So price up a little cost-down, but more on the cost side. Would you say that, that $6 million benefit net-net? I mean, is that a function of lower raw materials? Is that better mining efficiency? Is it lower fixed costs? I mean, what would you point to kind of characterize the cost-benefit that you experienced this year versus one year ago?

Yes. Thanks, David. This is Erik. It's kind of all of the above that you mentioned. It's about -- if you want to break it down, it's about a third raw materials, a third energy and a third productivity. And in productivity, I'll throw in kind of fixed-cost savings as well. But from a productivity perspective, we're performing really well this year. We typically -- we go into every year targeting 10% productivity improvements from a tons per hour worked perspective and 3% variable conversion cost improvements. And those are aggressive targets and -- but this year we're above 5% from productivity savings across the Company. I mentioned a lot of that is coming from our newly-acquired pet care facilities. We're still driving efficiencies in those facilities as we continue to automate and just bring these new plants up to kind of the MTI standard from a productivity perspective and a variable conversion cost per ton standpoint. So there's savings there. And then on the fixed-cost side, we're staying disciplined around fixed-cost. I mentioned we did have that savings program that we implemented last Q3, and so we've got the full run-rate of that in effect as well. So it's across the board. We're performing well from a cost standpoint.

Okay, great. Thank you for that. I'd like to ask a question. I think it's going to build on the PFAS question that was asked previously, but maybe I'll throw in MINSCAN as well, but just sticking with PFAS for a minute. But you said you have eight pilot projects underway, and this is my opinion, but I think between now and let's say, 2026 or so, when the water utilities have to kind of define their particular positioning relative to the EPA standards and then sketch out a plan for remediation. But -- so in that interim period, you're -- I'm guessing there's going to be a steep ramp-up in pilot projects and beta testing and whatnot, and I'm wondering whether that has a net economic cost impact for your Company. In other words, is this the kind of thing where increased testing and rollout of your products to potential customers causes a meaningful, I don't know, upfront cost impact? So maybe I'll just stop there, but how should we think about -- we're always thinking about price and volume, but if you're rolling out new products on maybe a larger -- more broad scale than historically with other new product initiatives that might be more targeted, how should we think about how the upfront expenses or the pilot testing period impacts your financials?

Sure. Thanks, David. Let me -- just a bit of perspective, and I'll pass it to Brett again. We talk about eight pilot trials with EPA and we talk about we're in six water utilities. We're actually running 250 different pilots around the world in terms of PFAS, right? So these can be tests -- small tests and they move them into more full-scale trials. So we're -- this isn't just small -- small-scale here. We're -- it's pretty broad in terms of how we're testing this in different situations. Now most of those we're getting paid for. So they may be small in revenue, but -- and they do cost us to manufacture, but we're getting paid for those and making a profit on them. Now, the potential of those 250 as they become full-scale and as they move through their pilots with different technologies over the next three, four years, that's the kind of breadth that they -- if they go to scale, the type of volume that will be pulled into -- and some of them will use PFAS and some might use others and we might be used in conjunction with different technologies. But that's when the volumes will start to really drive and the contribution will start to kick in for this product. So I don't know, Brett, do you want to give a little bit more color on that? I just want to give some perspective before I pass it.

Yes. No. Hi, David. Doug is right. I mean, we have over 250 pilots -- active pilots. And keep in mind, I think we may have mentioned it or Barry mentioned it at our conference, there's minimal to no capital. Our equipment -- we don't have to capitalize equipment. The FLUORO-SORB can be used in existing municipality equipment. So it's -- the cost outlay is very minimal for us because our product was designed to work right through those products or through the existing equipment. So with the work we're doing with the EPA, that's going to -- that should accelerate it. Will we see a hockey stick, probably not in the next couple of years. It's going to take some time. But again, as Doug said, we have eight pilots that we just brought on. We have six full-scale drinking water systems that are utilizing our FLUORO-SORB. We have two additional full-scale projects that are coming on in the fourth quarter. So we're really excited about it. And internationally, we're seeing an uptick in active piloting for the FLUORO-SORB in other EU countries for drinking water. But keep in mind, this product can be used as we mentioned earlier in drinking water. We have landfill leachates, wastewater, and remediation. So yes, we got a -- we're excited about it. How soon it's going to hit is still a little bit iffy, but we're going to stick with our target of 30 million [ph] by 2027, and we'll -- and we hope to accelerate that.

Okay, great. Thanks for walking through that. I have a question that's more China-related so I guess part metal casting part PCC. But you know, by all accounts, this has been a slow a rebound or slower -- period of slower economic activity in China. And the government there recently has taken some incentive or incentive measures to try to get the economy kicking into a higher gear. And I know you're part of the -- Chinese economy is limited, but from what you could see thus far? I mean, has the economic supporting measures by the government? Has that had any noticeable impact on your relevant businesses there? And you know, is any of that -- if there is -- improvement there is that factored into your -- I don't know, your view for 2025?

So, I think it's a bit -- to answer that last question. I think it's a bit early to see if whether the stimulus that was put in place in China is having a major impact. My thought is, yes, it will, but maybe a little bit too early to call that one in terms of our business and volumes. I will say though that though China has been -- the economy there has been a bit slow over the past couple of years, we've continued on our growth track in foundry. Our volumes are up 8% this year on a relatively what I guess folks would call a weaker Chinese economy. And I put that into my comments because I wanted to highlight that fact that says, look, we're continuing to build the thesis that we have for Asia and India -- China and India in foundry is that even through -- higher levels of demand will help it, but even at lower periods of demand like we are right now or more moderate levels, we're still able to grow at this kind of 8% to 10% rate we always have been. And that is because the penetration of the market to our solution is only at about 25%, and we've been driving that over the past 10 years from 5% to now 25%, and there's a lot more to go in both. And India is further back in terms of penetration. So there's an enormous addressable market for us there. And despite it might be weaker economy in China over the past couple of years, it's enabling us. We're able to continue to drive that penetration and drive volume growth for our company. On the paper side of things, a little bit different than kind of economic stimulus will help some of that. But it's a different dynamic there. Again, it's penetration where both in India and China as consolidation of paper and packaging production into newer machines, newer technologies come in. We are the provider of that newest and latest technology. Recycling environmental technologies are becoming the forefront of how we sell there and those are taking hold. And so again, even with flat production of paper and packaging in China and India, we're able to continue to penetrate with our technologies into the market. And so that's what's really driving our economics or at least our revenue streams. Should those economies continue to move higher in terms of GDP, it will only drive those further.

Okay, very good. Last question and I have to confess, this is probably the first time I've ever focused -- asked a question about your most recent dividend hike. But, in my opinion, I think the context for that is kind of a little different than for most other companies I follow. I mean, you've been public for over 30 years and I think over that time, you know, the number of dividend increases you've announced can fit on the fingers of one hand, probably with one or two left over. So we're in an environment you did double the dividend a year ago and now one year later, you're coming back with a sizable but historically more modest dividend hike. So when I think about two dividend hikes more than doubling the previous off of a base that you're more than doubling now, is this part of a longer-term strategy for distributing cash to shareholders? Or you know, how should I think about a relatively rare event now becoming a little more common?

Well, you're right. The number of times we've increased the dividend I think is a total of four in the Company's history. But David, I think it's -- let me take it to a different place. I think the Company is different than it is -- now different than it was five, 10 years ago. I think we focused more on share repurchases earlier in the Company's history, gave the Company flexibility to pursue growth. And I'm not saying, hi, this is a maturing company. I just think that we put ourselves in positions for much more stable revenue growth, stable profit growth and stable cash flow growth, okay? And -- so you notice we still are tending more towards share repurchase and that flexibility and giving the Company -- we think that there's inorganic opportunities out there and we think that share repurchase provides our ability to move toward a high-value acquisition versus share repurchase. But it does also where the Company is today and cash flow forward profile support more of a dividend. Now you might say 10% is modest. We'll continue to evaluate that cash flow growth as we go next year. It could end up being something that we'll do regularly, but I think it's just getting to a place where we feel we can easily support a dividend increase, a doubling last year, and another increase this year, also a share repurchase program, and inorganic opportunities. That's quite a bit of flexibility and financial power for our Company. So it's also the confidence that we have in the model that we have. This structure of balanced structure of the Company being able to move through economic conditions and still generate 7% of cash flow to sales, and we think, well, okay, we'll increase the dividend and we'll have a share repurchase program, and we still have capital left for inorganic opportunities. And I think that's just reflective of where the Company sits today. That help?

Yes. No, I really appreciate the context there. Thank you. That's it from me. I appreciate all the color. Thank you.

Thanks, David.

And at this time, I'd like to turn the call back to Mr. Dietrich for any closing remarks.

Thank you very much for attending this quarter's call. We look forward to chatting with you at year end and giving you our full-year results in January. Take care.

This concludes today's call. Thank you for your participation. You may now disconnect.