Precision Castparts Exec Insights: Offsetting Headwinds, CapEx Outlook
Howard Rubel – Jefferies: Mark, at the end of the release you talked about headwinds and the capability to offset them. Could you elaborate a little bit on that?
Mark Donegan – Chairman and CEO: Well, again $32 million is not a small number, but with what we have and where we are in growth. Certainly we will power our way to overcome those and go beyond that. The reason why, $32 million is a big number that needed to be called out, but like I said I am not throwing it over the fence to anybody, we get it and we are not sitting with a lack of ideas of what to do. So we’ll overcome it and we’ll go beyond that in terms of what we need to do. So it’s really Howard more just to call it out as to what was there.
A Closer Look: Precision Castparts Earnings Cheat Sheet>>
Howard Rubel – Jefferies: It’s not an operational issue like you are also pointing out the forge outage for that period or it’s just the cumulative all these little items, it’s nothing big or anything like that?
Mark Donegan – Chairman and CEO: The one off, we get the pension, it is what it is, we got to overcome it. The one that’s there, that we’ve been prepping for is the outage, shy of that, it’s just a normal wear and tear that we face in an operation and we fight our way through. There is nothing other than that that we know about today.
Jason Gursky – Citi: Can you just give us an update on the CapEx outlook for this year and the next couple of years if you wouldn’t mind talking about having?
Mark Donegan – Chairman and CEO: I think that this year will be up to some degree, what we basically have done is kind of set a target of what this capital expenditure was plus the growth rate and that’s kind of the range we’re coming in at. I think that we have a couple of starts this year. We’ve talked about the furnaces that we’re bringing in the airfoil side. We have additional ones coming in after that. And then we have the graft in the outage which is putting a number in there, but I think that’s we’re looking at is kind of a proportional growth in capital to overgrowing it. If I look out beyond that, I’d say the next inflection point for us is really is in the powder side of our business. Depending on at what rate some of the more attentions come in, so the leap would be one but how that transitions between the existing platforms and new ones will dictate when we will need to put another atomizer and which is how we make the powder and another iso-press. That conversations we are in right now, but it’s probably going to be somewhere in the ‘15, ‘16 time frame is when we will face that decision point. That’s probably $100 million price tag when that occurs between those two pieces of equipment.