Luxfer Holdings PLC (NYSE:LXFR) reported its earnings for the fourth quarter of 2023, revealing adjusted sales of $87.8 million, which slightly exceeded guidance. The company experienced a 2.9% decline in adjusted sales for the full year, totaling $373.5 million, attributed to macroeconomic challenges in the industrial sector.
Still, adjusted EPS for the year reached $0.80, surpassing expectations. For 2024, Luxfer forecasts flat to slightly lower sales compared to 2023, with adjusted EPS projected between $0.70 and $0.85, and adjusted EBITDA expected to range from $42 million to $46 million.
Key Takeaways
- Luxfer's Q4 adjusted sales were $87.8 million, with a full-year total of $373.5 million.
- Adjusted EPS for 2023 was $0.80, and adjusted EBITDA stood at $43.3 million.
- The company experienced a decline in transportation sales by 22.3% for the quarter and 10.2% for the year.
- Luxfer plans to divest its Graphic Arts business and focus on growth in the Gas Cylinders and Elektron segments.
- 2024 outlook includes flat to slightly lower sales with improved performance expected later in the year.
Company Outlook
- Luxfer anticipates flat to slightly lower sales in 2024 compared to 2023.
- Adjusted EPS for 2024 is forecasted to be between $0.70 and $0.85.
- The company expects adjusted EBITDA for 2024 to be in the range of $42 million to $46 million.
Bearish Highlights
- The company reported a 2.9% decline in adjusted sales for the full year due to industrial sector challenges.
- Transportation sales decreased by 22.3% in the quarter and 10.2% for the full year.
- General industrial end markets saw a 42.8% decrease in sales in Q4.
Bullish Highlights
- Luxfer saw increased demand for gas cylinders, leading to slightly above-guidance sales in Q4.
- New SCBA agreements and insurance coverage for legal expenses were positive developments.
- Lower upcoming costs for magnesium and strategic pricing are expected to benefit the company.
Misses
- Full-year adjusted sales decreased by 25.6%.
- Q4 sales decreased by 17.4% to $87.8 million, primarily due to lower volume and unfavorable mix in industrial and transportation markets.
- Adjusted EBITDA for the quarter decreased by $3.1 million to $8.1 million.
Q&A highlights
- The company has made necessary cost adjustments starting from October 2023 due to new multiyear supply agreements.
- Luxfer's Elektron business is expected to see demand return in military, industrial, and transportation sectors in the first half of 2024.
- Andy Butcher, the CEO, is satisfied with the supply continuity ensured by the agreements.
Luxfer Holdings PLC has undertaken a strategic review, resulting in the decision to divest its Graphic Arts business and identify growth opportunities within its Gas Cylinders and Elektron segments. Despite a challenging macroeconomic environment and a decline in certain market segments, Luxfer remains optimistic about its 2024 outlook, with an expectation of improved performance as the year progresses.
The company will continue to focus on maintaining a healthy balance sheet, generating strong free cash flow, and investing in organic growth projects. Luxfer will keep stakeholders updated on its progress at various conferences throughout the year.
InvestingPro Insights
Luxfer Holdings PLC (LXFR) has been navigating a complex industrial landscape, as reflected in the company's recent financial performance. To provide a deeper understanding of Luxfer's market position and future potential, here are some key insights based on real-time data and InvestingPro Tips.
InvestingPro Data highlights a market capitalization of $255.2 million, indicating the company's size and investment scale within its sector. The Price/Earnings (P/E) ratio stands at a forward-looking figure of 16.41 based on the last twelve months as of Q3 2023, offering investors a sense of the company's earnings relative to its share price.
Moreover, the company's dividend yield is notable at 5.47%, which is particularly attractive to income-focused investors.
From the perspective of stock performance, Luxfer has demonstrated significant returns over various periods, with a one-week price total return of 23.67% and a three-month price total return of 17.17%. These figures suggest a strong recent uptrend in the stock's price, which could be of interest to momentum investors.
Two InvestingPro Tips provide further context: Luxfer exhibits a high shareholder yield, which is a composite measure of dividend payouts and share repurchases, indicating a commitment to returning value to shareholders. Moreover, the company's liquid assets exceed its short-term obligations, suggesting a solid financial footing and the ability to meet immediate liabilities.
For those seeking additional insights, there are more InvestingPro Tips available, including analysis on the stock's overbought status according to the Relative Strength Index (RSI) and predictions on profitability. To explore these further, Luxfer investors can visit https://www.investing.com/pro/LXFR and use the coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription. There are 9 additional InvestingPro Tips listed for Luxfer, providing a comprehensive investment outlook.
Full transcript - Luxfer Holding Plc (LXFR) Q4 2023:
Operator: Good morning. My name is Todd, and I will be your conference operator today. Welcome to Luxfer's Fourth Quarter 2023 Earnings Conference Call. All lines have been placed on mute. After the speakers' prepared remarks, we will hold a question-and-answer session. Now I will turn the call over to Kevin Grant, Vice President of Investor Relations and Business Development at Luxfer. Kevin, please go ahead.
Kevin Grant: Thank you, Todd, and good morning, everyone. Welcome to Luxfer's Fourth Quarter 2023 Earnings Conference Call. This morning, we'll be reviewing Luxfer's financial results for the fourth quarter ended December 31st, 2023. I'm pleased to be joined today by Andy Butcher, our Chief Executive Officer; and Steve Webster, Chief Financial Officer. Today's webcast is accomplished by a presentation that can be accessed at luxfer.com. Please note, any references to non-GAAP financials are reconciled in the appendix of the presentation. Before we begin, a friendly reminder that any forward-looking statements made about the company's expected financial results are subject to future risks and uncertainties. We undertake no obligation to update any forward-looking statements whether as a result of new information, future events or otherwise. Please refer to the Safe Harbor statement on Slide 2 of today's presentation for further details. During today's call, we will be providing adjusted fourth quarter and full year 2023 financial results that exclude Graphic Arts based on our strategic review decision to divest that business. Now let me introduce Luxfer's CEO, Andy Butcher. Please turn to Slide 3. Andy, please go ahead.
Andy Butcher: Thank you, Kevin, and good morning, everyone. Thank you for joining us. I would like to begin by acknowledging the dedication of the Luxfer team as they served our customers and focused with an optimized lens on all aspects of our operations. They delivered solid and improved results against the backdrop of challenging market conditions as well as the added demand of our strategic review process, I am very grateful for their commitment. Today, we will provide details on our 2023 fourth quarter and full year financial performance. Additionally, we will share important positive information on our self-help actions including new SCBA agreements, go-forward insurance coverage for our elevated legal expenses and some lower upcoming costs for magnesium. We will also provide an update on the initial decisions from our strategic review and lastly provide our 2024 guidance. We have a lot to cover today, so let's get started. We achieved adjusted fourth quarter sales of $87.8 million, approximately 3% above the midpoint of guidance, underpinned by an increase in gas cylinder demand. For the full year 2023, adjusted sales were $373.5 million, a decline of 2.9% from the prior year, reflecting the industrial macro challenges we faced, particularly during the third quarter. Full year adjusted EPS of $0.80 exceeded our most recent expectations and full year adjusted EBITDA was $43.3 million. In addition to better-than-expected sales and earnings, we generated improved operating cash flow and full year free cash flow more than doubled the prior year. Our balance sheet remains healthy with net debt leverage of approximately 1.6 times. This gives us additional assurance and the flexibility to continue investing in areas where we can grow in support of our customer value proposition. Steve will walk through the financial performance for the quarter and full year in more detail but we are encouraged with the sequential momentum of our ongoing business as we exited 2023 with a number of positive developments that we believe position us well for 2024 and beyond. The supply chain challenges we faced with our commercial magnesium have, to some extent, eased, particularly in areas outside of the USA. Though pricing is still at elevated levels relative to 2021, there is greater pricing stability and this should help support our demand recovery in some of the Elektron, Industrial and Transportation sectors. In the USA, supply of magnesium remains restricted and price premiums in this region remain abnormally high. So we have qualified and contracted for an additional source of magnesium and this should support an improved position in a number of our end markets. As discussed in prior calls, we incurred elevated legal costs throughout 2023 and expected that these costs would continue into 2024. Today, I am pleased to announce that late in the fourth quarter, after detailed discussions our insurance company determined that these costs will be covered. This will eliminate approximately $5 million of annual legal costs going forward, and we are taking action to recover historical costs. This is a tremendous development and eliminates some uncertainty from our results going forward. In addition, we've made further progress in the fourth quarter with the tactical operational actions we are taking to improve financial performance, including minimizing expenses, passing through higher input costs and improving cash flow. I will return to these in a few minutes. Firstly, and very important to us, I want to cover our comprehensive strategic review process. Let's turn to slide four for an update. In October, we announced an acceleration and expansion of our annual strategic review process. The motivation for this comprehensive and portfolio-wide exercise is to improve the performance of our businesses and unlock shareholder value. With the support from our Board of Directors, we have engaged with Deutsche Bank (ETR:DBKGn) as our financial adviser during this process. Today, I would like to share with you our findings from the initial phase of our review and their implications for the future of Luxfer. Firstly, we have determined that the Graphic Arts business is not central to Luxfer's go-forward strategy and does not fit with our value proposition. This is a good business, delivering quality products and supported by an outstanding team. However, after thoughtful evaluation, we believe Graphic Arts will be better served with a sharper focused owner. We are working with XMS Capital Partners to identify and engage a suitable buyer. Secondly, we have revisited our internal strategic growth plan and remain highly encouraged by the opportunities for improved performance over the next few years. We have already executed quick actions across our operations to improve the cost structure. We have identified several end market megatrends that will drive higher demand for our products, including positive developments in the transportation sector where Gas Cylinders is realizing increased demand for a number of alternative fuel products, especially related to CNG in North America. We are increasingly confident that both the Gas Cylinders and Elektron segments can deliver attractive profitable growth during 2025 and beyond. Thirdly, and notably, we've determined that the remaining Gas Cylinders and Elektron segments have no significant strategic synergies and therefore, is no material benefit to these being owned by the same company. At the same time, while there is no overriding rationale to keep the businesses together, there is no immediate need to separate the two and no reason why they cannot coexist under the same corporate structure with the expectation that business conditions and macroeconomic market dynamics will improve during the periods ahead. With that flexibility, we have various mechanisms available to create value including optionality for the possible sale of one or both businesses. We will evaluate whether alternative ownership drives up lifted performance and value creation. In the meantime, we will operate and manage both businesses for their long-term success as they serve their customers by delivering the Luxfer value proposition. We are pleased with the progress to date of our strategic review. We have made some key decisions regarding the future composition of our portfolio, including the decision to sell Graphic Arts. We have refined the ongoing strategy of profitable growth in both Elektron and Cylinders. And Importantly, we have recognized future options for our remaining businesses that position us to unlock maximum value for our shareholders. Now turning to Slide 5. Let me update you on the impact of actions we undertook in 2023 to improve performance. In our Elektron segment we have fully completed the consolidation of the Elektron Powders plants, which is now delivering $900,000 in annual savings and the potential to sell the vacant site later this year. We have introduced a new source of magnesium for some of our North American facilities. And we have executed programs related to improving productivity and lowering fixed costs all helping to offset the weak Q4 demand, which materialized as we projected in our last call. Additionally, as I stated earlier, we've been able to confirm that we have insurance coverage for the abnormal legal charges we have been incurring, which eliminates the expense from our forward projections sooner than anticipated. In Gas Cylinders, we have new long-term multiyear supply arrangements with both of our major SCBA customers. These important agreements enabled us to address high carbon fiber costs and restore margins while providing continuity to our customers. We are delighted to be retaining these relationships and to be providing our ultralightweight products to the domestic and global firefighter communities. We have also completed the optimization of our North American alternative fuel footprints, already delivering $1.1 million in annual savings, while significantly increasing output to meet the higher demand for CNG cylinders. And finally, we have begun the construction of our new bulk gas transportation module facility in Nottingham UK, which will come online towards the end of 2024 with future capacity for revenues of up to $40 million annually. We have made strong progress on improving overall performance. In addition, we have made important decisions on the long-term structure of our portfolio. These efforts position Luxfer to grow margins, improve profitability, deliver strong cash flows and return cash to shareholders. There is still more work to be done, but we are already on our way to achieving levels of profitability that reflect the value that our innovative materials engineering delivers to our customers. At this time, I'll turn the call over to Steve to discuss our Q4 and full year 2023 results in greater detail, emphasize our strength and balance sheet and provide our initial outlook for 2024. Steve?
Steve Webster: Thanks, Andy. I first want to echo Andy's sentiment about our excitement and the positive momentum we have made regarding the strategic review process. The acceleration and expansion of our annual strategic review has clearly identified optionality to the Board of Directors and the Luxfer leadership, which we can execute successfully. Now I'll begin on Slide 6 with a summary of our sales performance by end market. Please note that these financials and my comments exclude the Graphic Arts business, for which we are in the process of identifying a suitable buyer. Defense, First Response and Healthcare sales remained strong, growing 9.7% compared with last year, driven by ongoing strength in lightweight SCBA as well as medical cylinders, offsetting anticipated lower fourth quarter demand for flameless ration heaters and chemical kits. For the full year, Defense, First Response and Healthcare was up 23.9%, demonstrating both the strength and secular nature of our largest end market. Transportation sales decreased 22.3% in the quarter and full year sales decreased 10.2% compared with the prior year. In the quarter, areas of softer demand included auto catalysis material and aerospace applications. General industrial end markets continued to face macro headwinds resulting in sales decreasing by 42.8% in quarter four. As was the case in previous quarters, this impacted demand in applications such as commercial magnesium powders, industrial zirconium and oil and gas. Full year adjusted sales decreased 25.6%. Please turn to Slide 7 for a summary of our consolidated fourth quarter financial results. Fourth quarter sales decreased 17.4% from the prior year to $87.8 million. While we delivered strong favorable pricing of $7.2 million and received benefits of $1.2 million in foreign exchange, these were more than offset by lower volume and unfavorable mix of $26.9 million, primarily in industrial and transportation markets. Fourth quarter adjusted EBITDA decreased $3.1 million from the prior year to $8.1 million. Adverse cost inflation and foreign exchange were positively offset by pricing. However, the business was not able to absorb end market demand pressures impacting volume, which were primarily in Elektron. Importantly, the combined business did achieve sequential adjusted EBITDA growth from the third quarter of 2023. Fourth quarter 2023 adjusted EBITDA margins were 9.1%. Turning now to Slide 8 and our segment results. Reflecting our decision to sell Graphic Arts, that business is now reported in a separate segment, and our results shown on Slide 8 do not include Graphic Arts. Gas Cylinders fourth quarter 2023 sales of $51.7 million were relatively flat with last year as higher SCBA and medical sales were offset by lower demand for alternative fuel and industrial cylinders. Despite flat sales, we achieved a significant increase in adjusted EBITDA, more than doubling to $6.5 million, supported by the cost pass-through on our newly negotiated cylinder supply arrangements and by increased demand. Elektron fourth quarter sales decreased 33.8% from the prior year to $36.1 million, driven by lower demand and unfavorable mix in the general industrial end market, slightly offset by pricing and FX tailwinds. Adjusted EBITDA of $1.6 million decreased from $8.2 million primarily as a result of lower demand that more than offset positive price versus inflation. Now please turn to Slide 9 to see our full year 2024 financial outlook. Note this does not include the Graphic Arts business. We expect 2024 sales to be flat or slightly lower than 2023. Although better than second half of 2023 with the overall market landscape improving as we go through the year. We expect positive overall growth momentum for the Gas Cylinders business for the full year although we see softer demand sequentially in quarter one coming out of an unseasonably strong quarter three -- quarter four 2023. Elektron's end markets will gradually improve although some softness may linger through the first half of 2024. Based on this outlook, we expect adjusted EPS will be in the range of $0.70 to $0.85, with the business ramping up towards the middle and latter part of the year. Like our sales outlook, our expectation is that earnings will strengthen during the year with notable improvement as Elektron rebuilds from their depressed quarter four performance. Adjusted EBITDA for the year is anticipated to be in the range of $42 million to $46 million, again, with a bias towards the latter quarters with quarter one expected to be similar to quarter four 2023. Our exit velocity at the end of 2024, adjusting for seasonality will be above this range, positioning us to achieve greater EBITDA in 2025. We remain focused on prioritizing a healthy balance sheet and driving strong free cash flow. This enables us to support a balanced approach to capital deployments with the flexibility to invest in future growth and return cash to shareholders maintaining current levels of dividends and share buyback. While we do anticipate an uptick in inventory levels as we prepare for higher revenues, working capital management remains important. And we expect to generate free cash flow of $20 million to $24 million. CapEx for the year is projected to be in the range of $11 million to $14 million compared to $9.4 million in 2023. As we incrementally invest in organic growth projects, including our new production facility to assemble bulk gas systems, we ensure that all such organic growth projects align with our value proposition and with the framework of our strategic review. Before I close, I wanted to cover the item reported in our Form 10-K filed yesterday regarding the technical statement of material weakness. This relates to the design and operation of certain controls pertaining to the recording of inventory in transit, which affected only balance sheet accounts and had no impact on either the income statement or key performance indicators. We are in the process of designing enhanced procedures over inventory in transit, which we are confident will address this area. Returning to the year ahead, I'm optimistic regarding Luxfer's 2024 outlook and our market position to capture growth in key end markets that have been muted recently. I'm encouraged by the projected demand levels, which gives us confidence that we will see volume growth as we emerge from the first quarter into the remainder of the year. This should put us on a trajectory to continue building momentum into 2025 to achieve higher levels of profitability and continue to create value for our shareholders. Now I'd like to turn the call back to Andy. Andy?
Andy Butcher: Thanks, Steve. I will conclude my prepared remarks on Slide 10. 2023 was a challenging year with several factors having an adverse impact on our full year results. The focused actions we have taken to improve performance and profitability have been effective in turning the corner and we expect to make further progress as we move through 2024. Throughout this time, I've remained extremely proud of our global team's ability to execute through difficult circumstances. As we conclude this update, I'd like to highlight again the significant progress we have made over the last few months that give us confidence in our ability to deliver improved results. Concluding new commercial arrangements for our SCBA cylinders, recovering our carbon fiber costs, improving margins and restoring profitability. Capitalizing on early signs of demand recovery in some of our Elektron, Industrial and Transportation sectors with an uptick in orders. Resolving our insurance coverage for the abnormal legal charges that we have been incurring in Elektron, eliminating this expense going forward. Completing our two consolidation programs, improving our cost base in both Elektron and Gas Cylinders provided annualized cost savings of $0.9 million and $1.1 million, respectively. Lastly, reducing our inventories, delivering higher levels of free cash flow and reducing our net debt below $70 million. The Board and I are encouraged by these developments, and we enter 2024 with strengthened levels of confidence. While the industrial macro environment remains uncertain, we're already seeing a rebound in demand for a number of higher-margin Elektron applications, and we are pleased with the recent elevated performance of Gas Cylinders. As we continue to navigate the future together, we are following a clear path to value creation, solving our customers' challenges with our materials engineering expertise while improving profitability and margins, maintaining strong levels of cash generation and executing on the outcome of our accelerated strategic review. We are making substantial progress on actions that we expect to unlock shareholder value and gaining confidence that we will return Luxfer to a path of margin improvement and sustainable earnings growth. With that, I'd like to turn the call back to the operator to begin the Q&A session. Todd, please go ahead.
Operator: At this time, the floor is now open for questions. [Operator Instructions] Our first question comes from Steve Ferazani with Sidoti. Please go ahead.
Steve Ferazani: Good morning, Andy, Steve. Thanks for the detailed call. Obviously, it's been a very, very busy quarter and the guidance, which seems to indicate you've taken significant steps to improve profitability going into the New Year. A lot to cover here. Can we touch on first the decision to divest Graphic Arts. What went into that? What differentiates issues with Graphic Arts from the rest of Elektron. And then I know probably you can't answer it, but timing and what the value of Graphic Arts could be.
Andy Butcher: Thanks for joining us, Steve. A lot of questions there. First of all, the decision to sell Graphic Arts and why it no longer fits with our portfolio. We originally purchased that business, Steve, back in 2003 when it traded as Magnesium Elektron North America. And at that time, we envisaged it as a high-volume aerospace and automotive supplier. Increasingly, of course, the business opportunity grew in Graphic Arts very successfully, but moving more and more away from Elektron's core competence in material technology and allies. So we think that now Graphic Arts will do better under a new owner. Helped, no doubt by the upcoming lower magnesium costs, which should provide higher levels of profitability. And frankly, I'm excited that the successful sale of that business will release resources to the rest of Luxfer, results in both time and money for us to deploy on some of our core organic opportunities elsewhere in the business, materials technology, lightweighting, clean energy. In terms of timing, I can't answer that. We're aiming for completion in 2024. The work we've done to date with the help of XMS Capital Partners suggest that this is achievable. As you suspected, I probably wouldn't want to discuss the transaction price. But I would note, the inventory is currently valued at around $17 million. And the business operates with substantial, although somewhat aged capital assets. We're just initiating the process. We're going to be running a comprehensive process to ensure we deliver the very best outcome. Look, this is a good business, delivering quality products, led by a strong team with some significant assets. We don't doubt there is a good buyer out there for the business.
Steve Ferazani: Very helpful. Thanks for covering all that. Just, I guess, a question for Steve. Since you're guiding with audit. Are you going to be able to include this into discontinued operations moving forward? Or what would be necessary to predicate that.
Steve Webster: Yes, there's some technical accounting there, Steve, which I won't go into, but it doesn't quite meet the criteria in terms of size, strategic shift, et cetera, to be a discontinued operation. What we will be doing from quarter one is classifying it as available for sale or held for sale. And then we will, as you've seen with these results, continue to adjust out Graphic Arts from our ongoing results, as I have on the guidance, reflecting that it is no longer strategically part of Luxfer.
Steve Ferazani: Thanks for that, Steve. If I could shift gears on to very, very strong performance for Gas Cylinders. Just trying to walk through the pieces a little bit on the SCBA agreements and how much they were a part of that. Did you get the full benefit of the new agreements in the quarter because this is your highest margin for that business in quite some time. So I'm trying to mix the much stronger volume versus the benefits from the new agreements. And also, I think you mentioned Q1 will be softer after a particularly strong volume quarter. Can you just sort of walk through the pieces of that margin and how you're thinking about that moving forward?
Andy Butcher: Yes, pleased to do that. Steve, we're very proud to be a leading supplier into the firefighter SCBA market and to be able to provide our lightweight high-pressure cylinders into what is a very important life-saving application. And so, yes, we're very pleased that Luxfer Gas Cylinders and their two largest customers have recently formalized these new multiyear supply agreements. As part of this, Luxfer Gas Cylinders has been able to make the necessary adjustments related to cost increases. Those did take effect from October, the start of Q4 2023. And those adjustments will now be executed on a quarterly basis going forward. Quarter Four was also a very strong period for demand in SCBA cylinders and we're really pleased with the way the Luxfer operations in Riverside stepped up to address that. Products for firefighters have been a bedrock of the cylinder business over the last 20 years. It's -- and in turn, very important for our customers' businesses. So we're very, very satisfied that these agreements are now in place with the associated supply continuity.
Steve Ferazani: Excellent. Thanks for that, Steve. When I think about -- I think I may have the language wrong here, but gradual improvement in Elektron. Can you talk about strengthening versus not strengthening end markets for your Elektron -- varied Elektron businesses. And also, timing of seeing some of this additional magnesium supply, I would assume lower cost, how that can affect margins as we go through the year and into '25.
Andy Butcher: Yes. So magnesium supply is obviously an important part of the Elektron business. And you'll recall that the US magnesium plant has been offline since late in 2022 for some major maintenance and capital engineering work. We do maintain a regular dialogue with them, but the time line for a restart is still a little unclear. The overall landscape for magnesium supply has improved, though, especially over the last six months as some of the supply chains even out. And we've proactively developed and approved some alternative suppliers. And in 2024, we bought another one of those online, which is beneficial. So yes, while magnesium pricing is still up from historic levels, it's considerably lower than we saw at the peak in 2022. And as we work through our inventory as quickly as we can, we will see lower overall costs, which will be helpful as we seek to rebuild demand in the Elektron segment. And we do think that quarter four represents a low mark for Elektron last year. And we'd flagged some lower sales of products such as military, meals ready-to-eat, flameless ration heaters. And we're already seeing that demand coming back in quarter one. And some further strengthening in Elektron in quarter two in some of the general industrial and transportation products. So a difficult Q4 for Elektron and an increasingly brighter period ahead.
Operator: Thank you. At this time, I'll now turn the call back to CEO, Andy Butcher for final remarks.
Andy Butcher: Well, thank you for the questions, Steve, and thank you to everyone for joining the Luxfer call today. We are entering 2024 with favorable momentum as the structural changes to our operations, improve our cost base, our strategic pricing drives sustainable margin improvements and the definitive directions from our strategic review process gives us the opportunity to further unlock shareholder value. I'm really very pleased with the work on the strategic review process, and I look forward to discussing those three elements with you further in the quarters ahead, the disposal of the Graphic Arts business, the improved performance that we will see in Gas Cylinders and Elektron as we deliver profitable growth and the optionality that we now have in our portfolio. I hope that like me, you are excited about the prospects for 2024. Before I conclude, I'd like to mention that we will be attending the ROTH Conference on March 19th in Dana Point, California. In addition, we will also be attending numerous other conferences throughout the year. And I hope to have the opportunity to connect with many of you soon. As always, thank you for your interest and support in Luxfer. We look forward to updating you on our progress next quarter.
Operator: This concludes Luxfer's Q4 2023 Earnings Call. A recording of this conference call will be available in about two hours. A link to a recording of this webcast will be available on the Luxfer website at www.luxfer.com. You may now disconnect and have a wonderful day.
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