American Woodmark Corp (AMWD) 2012 Q1 法說會逐字稿

Good day and welcome to this American Woodmark Corporation conference call. Today's call is being recorded.

The Company has asked us to read the following Safe Harbor statement under the Private Securities Litigation Reform Act of 1995. All forward-looking statements made by the Company involve material risks and uncertainties and are subject to change based on factors that may be beyond the Company's control. Accordingly, the Company's future performance and financial results may differ materially from those expressed or implied in any such forward-looking statements.

Such factors include but are not limited to those described in the Company's filings with the Securities and Exchange Commission and the annual report to shareholders. The Company does not undertake to publicly update or revise its forward-looking statements even if experience or future changes make it clear that any projected results expressed or implied therein will not be realized.

At this time I would like to turn the call over to Glenn Eanes, Vice President and Treasurer. Please go ahead.

Good morning, ladies and gentlemen. Welcome to the American Woodmark conference call to review the financial results of our first fiscal quarter ending July 31 of fiscal 2012. Thank you for taking time to participate.

Participating on the call today from American Woodmark Corporation will be Kent Guichard, Chairman and Chief Executive Officer; and Jon Wolk, Senior Vice President and Chief Financial Officer. Jon will begin with a review of the quarter and an outlook for the future. After Jon's comments, Kent and Jon will be happy to answer your questions. Jon?

Thank you, Glenn. This morning we released the results of our first quarter of fiscal year 2012, ended July 31, 2011. Our earnings release contains the following highlights for the first quarter.

Net sales for the quarter were $131.2 million, representing a 20% increase from the prior year's first quarter. Net loss was $2.7 million or $0.19 per diluted share compared with a net loss of $3.4 million or $0.24 per diluted share in the prior year's first quarter, and the Company generated positive $2.1 million of free cash flow during the first quarter of fiscal 2012 compared with negative $0.3 million of free cash flow in the prior year's first quarter.

Regarding market conditions and our first-quarter sales performance -- during our last call, we provided five assumptions about market activity during our new fiscal year that ends on April 30, 2012, that job growth would average 200,000 per month, that consumer confidence would continue to slowly improve, that housing starts would approximate 625,000, that the remodeling market would be neutral to slightly positive and that our remodeling customers would experience sales comps in line with the market.

Here is our progress assessment on those assumptions. First, job creation has continued to occur, but the pace has slowed. There were over 200,000 jobs per month created in the three months that led up to our last call. In the three months following that call, job growth has slowed to an average of 60,000 per month and 1.2 million over the last 10 months -- still positive but less than we had assumed.

Second, consumer confidence -- until two months ago, consumer sentiment measured by the University of Michigan had been stable and trending positively, especially in the months of stronger job creation. Since that time, job creation has slowed and, more importantly, concerns over the US budget, the S&P credit downgrade and the potential for a double-dip recession have dominated the media. These stories have undermined confidence, evidenced by the University of Michigan reporting a recent drop in sentiment to its lowest level since 1980.

Third, housing starts have declined 5% for the first seven months of the calendar year, averaging an annualized level of 560,000 homes. However, starts have been 6% higher than last year over the last three months and permits have likewise been on the rise. So housing starts are roughly in line with our expectation thus far.

Fourth, the remodeling market -- sales reported by members of the Kitchen Cabinet Manufacturers Association were down low- to mid-single digits for each of the first seven months of calendar 2011. Since these results include both new construction, which has been down, as well as remodeling, our assumption of a neutral to slightly improving remodeling market is not far off.

Fifth and finally, our largest remodeling customers' results have been mixed, with one large customer reporting kitchen sales with positive comps and one with a slight negative. Collectively, these results appear to be in line to slightly positive with a remodeling market that is approaching neutral. Recognizing that the market is still not clearly improving, the Company's largest remodeling customers have continued to employ aggressive sales promotions for the last nine months in the form of free products and additional discounts based upon the amount of sale. In fact, this first quarter represents the last quarter in which we are lapping a prior-year comparison that had a more typically lower level of sales promotional costs.

Price-conscious consumers have continued to respond to the elevated level of promotions, causing the Company's remodeling sales to grow in excess of the 20% sales growth that the Company experienced overall. The Company's new construction sales also improved but at a single-digit rate during the first quarter in a market where total residential housing starts have generally been down but have begun to rebound. We had anticipated that the Company's sales growth potential would be stronger in the first half of its fiscal year due to the low sales comps that occurred in the prior year's first half, but the first quarter's 20% sales growth exceeded those expectations and is evidence of strong market share gains in a market that appears to have declined by single digits.

The Company's gross profit margin for the first quarter of fiscal 2012 was 14.0% of net sales. The Company's gross profit margin of 13.2% in the prior year's first quarter included a significantly lower sales promotional cost. The 80-basis-point improvement in gross margin was net of the adverse impact of over 200 basis points of incremental sales promotion cost that was incurred in the current year's first quarter. As I mentioned earlier, the prior year's first quarter was the last period in which more traditional promotional cost levels were incurred, and the promotional costs incurred during the current year's first quarter were more or less in line with the cost that the Company has been incurring during its preceding three quarters.

Despite the headwind from the elevated promotional cost levels, gross margin improved over the prior year due to significant efficiencies gained in labor productivity and absorption of fixed overhead costs, driven by the higher sales volume. The improvement in gross margin was somewhat offset by the impact of freight and materials costs that were higher than one year ago. In particular, the inflationary impact has been felt in paint, cartons, particle board, imported components, hardwood lumber and diesel fuel.

Total operating expenses were 17.0% of net sales in the first quarter of fiscal 2012, improved from 18.2% of net sales in the first quarter of the prior fiscal year. Selling and marketing expenses were 12.2% of net sales in the first quarter of fiscal 2012, improved from 12.9% of net sales in the prior year's first quarter. Selling and marketing costs increased by 13% in the first quarter on a sales increase of 20%. The favorable leverage was driven by relatively flat sales overhead and display costs that offset faster growth in variable compensation and increased amounts expended for business development activities.

General and administrative expenses were 4.8% of net sales in the first quarter of fiscal 2012 compared with 5.3% in the prior year's first quarter. G&A costs increased by 9%, driven entirely by an increase in the Company's incentive-based compensation expense.

Regarding capital spending, the Company's total outflow for capital expenditures and promotional displays deployed during the first quarter of fiscal 2012 was $2.1 million, in line with the prior year's first quarter. The Company expects that it will increase its investment in capital expenditures and promotional displays to a range of from $12 million to $15 million during fiscal year 2012, up from $8.4 million in the prior fiscal year. The Company generated operating cash flow of $4.2 million during its first quarter of fiscal year 2012 compared with $1.7 million in the prior year's quarter. The $2.5 million improvement during the first quarter resulted primarily from the reduction of the Company's operating loss and the timing of receipt and disbursements. The Company expects to continue to fund its capital spending from a combination of operating cash flow and existing cash on hand.

Regarding our balance sheet, the Company's financial position remains outstanding. The Company ended the quarter with a total of $70.5 million in cash, cash equivalents and restricted cash on hand compared with long-term debt of $24.5 million. Debt to capital was 13.9% at July 31, 2011. And during the first quarter the Company had positive free cash flow of $2.1 million compared with negative free cash flow of $0.3 million in the prior year's first quarter. The improvement was driven by the Company's improved operating cash flows combined with relatively flat capital investments.

In closing, we continued to manage the business with the primary objective of creating long-term value for our shareholders. We have chosen to continue to invest in improving the quality and breadth of the Company's products and services and enhanced promotional activities to drive market share gains despite challenging market conditions and expanding channels of distribution that we have not previously emphasized and in maintaining the capability for a significant amount of future growth when market conditions improve.

The Company continues to retain the organizational and production capacity and know-how to service demand in a market with average to above average new construction and remodel activity. Management remains focused on maintaining the strength of its industry-leading balance sheet. Despite experiencing net losses, the Company has operated at or near breakeven free cash flow levels for eight consecutive quarters and generated positive free cash flow in both fiscal year 2011 and in the first quarter of fiscal year 2012. The Company's first-quarter sales increase marked the fifth consecutive quarter of year-over-year sales growth, the first time that this has happened since 2006.

Although the market remains difficult to predict in the short-term, management remains confident in the Company's ability to continue to weather challenging market conditions until sustainable market growth occurs. We continue to expect that market activity will eventually return to its historical norms of 1.25 million to 1.4 million new households and 1.5 million new housing starts per year.

However, in the short-term, many consumers are still unwilling or unable to make large ticket purchases because of uncertainty, lower home prices and the lack of credit availability.

Assuming that consumer confidence recovers to its recent levels, we continue to expect that housing starts can achieve a 10% lift during our fiscal year that ends April 30, 2012, and that remodeling activity can become modestly positive. Given the magnitude of the Company's sales growth in the first quarter, it seems likely that the Company may be able to exceed the previous expectation of 5% to 8% sales growth for the fiscal year. Because of the week prior-year comp we expect that our second-quarter sales growth will exceed this level.

The Company continues to expect that its free cash flow may decline during fiscal year 2012 compared with the prior year, driven by a decline in the amount of expected income tax refunds and the expanded working capital and capital expenditure requirements associated with the Company's expected sales growth.

This concludes our prepared remarks. We would be happy to answer any questions you have at this time.

(Operator instructions) Sam Darkatsh, Raymond James.

A few questions -- first off, housekeeping. Jon, you mentioned that because the second quarter comparison is easier than the first quarter, that you expect to exceed this level. Is this level the 5% to 8%, or is this level the 20% that you just reported? I was confused.

5% to 8% annual guidance, Sam.

Okay, got you, because it's easier than the first quarter, I was -- why would you see a moderation in demand sequentially on a year-on-year basis?

Right. No, if -- the first two quarters of the last fiscal year were both low comps, and so we expected that we would have larger sales increases in the first half of the year than the second.

Okay. For the year, where do you peg your incremental margins at? There's a bunch of puts and takes, obviously, but based on what you're seeing now from raw materials and fixed cost absorption, where do you peg your incremental margins?

Well, we haven't really given that guidance out, Sam, so I don't know that we are prepared to do it right now.

Okay. Next question -- what are you seeing -- the promotions have been going on for some time now, and the first-quarter demand was terrific from a volume standpoint. Are you seeing the incremental lift from the promotions accelerate, or are the promotions themselves driving a different mix? Or how would you ascertain the chances of those promotions continuing for the foreseeable future?

Sam, this is Kent. We are kind of in a period now where it's kind of tough to tell. We're kind of in a low seasonal period until we get into September and the schedules really start to come back. Again, as Jon mentioned, it was really last fall, so it was not in our first-quarter comp when we kind of went to a different level of promotional activity which generated some good volume. In the spring, that continued, and a couple of our competitors even actually went beyond what we had seen in the fall. We generally did not, but that generated some good volume in the spring for everybody in the industry.

We have been in a quiet period now for really a couple of months. So that's -- the big $64 question is, when the incentives come back to really about what we ran last year. When we get into the fall selling season, we will be pretty much flat on a year-over-year comp basis, we think, with the promotional kind of activity, the promotional levels. And the big question is, of course, is it the consumers -- are they going to be there?

Every indication we have is we think that it will be pretty similar, that the promotional level and the volume that we're going to pick up as we get into the season; with that, will be pretty similar to what we have been experiencing.

Two more quick ones and I will defer to others. What was the unit volume growth in the quarter?

We will give that in the 10-Q that will come out in about a week. But it was predominantly unit growth, as you would expect. It was about -- 80% of the sales increase was unit, and the remaining 20% was what we would call price. But the price was really more mix than anything.

And then last question -- receivables were up about 30%. I'm guessing that's the mix, as it was over-weighted towards the home centers, or is there something else there?

You're talking about the growth year-over-year for receivables?

Yes, I'm sorry.

That's really just timing and sales volume.

Okay, all right, thank you much.

Joel Havard, Hilliard Lyons.

Kent or Jon, what does the picture look like for the current fiscal year and maybe sort of the intermediate term outlook, thinking as far as through next year, with regard to CapEx on the promotional display side of things? I'm not worried about brick-and-mortar, of course, but more about where you are with regard to cycling through replacements or new product lineups and things of that nature.

I would say kind of consistent with what you see in the overall CapEx number going up this year versus -- our expectation this year versus last year is -- some of that is equipment in the plants, but it also includes promotional displays. And it's coming from several areas. It's coming from model homes on the new construction side. We have seen some pickup in new communities being opened up and developed. And of course they generally put one to three model homes in the front. So we have seen some increase in that either because new communities or we have picked up communities as part of share.

On non-home center, non-big box remodel, we are -- again, as Jon has mentioned the last couple of quarters, we haven't historically emphasized those channels. We have done more work there, and we have signed up more dealers and more new business, which requires us to put, certainly, a selling center in and maybe a display. So there's some amount of activity on there.

On the home center side, it is pretty much limited to new product, getting our new product out there. As you probably know, in terms of actually remodeling, re-merchandising or updating the store, that's really driven by our customers' schedule. They don't let a manufacturer, by and large, go in and tear out their section of the floor and replace it.

So pretty much, we're kind of along -- go along with them in terms of their re-merch schedule. And they are doing some of that activity, but as you can imagine in this environment, it's limited as compared to what it is in prior year.

So in terms of the mix, it's probably about the same mix we've had if you look at the total CapEx number, internal CapEx versus displays and product out there. And so the whole thing goes up, and that goes up with it.

Kent, when you're -- well, thanks for that color. When you are talking about the new old channels, is that more kind of medium-sized box 2-step, or is this the specialty cabinet, specialty cabinet shop, that sort of thing? And is that really starting to move the needle at all for your top line?

Yes. Our terminology would be dealer. And generally, it's going to be somebody that has one to three locations, usually kind of a sole proprietorship kind of thing. There's lots -- or there's thousands of those folks out there. They do take -- account for a pretty big chunk of the industry. That has been a channel that we have had some business in historically but we have not emphasized.

In this environment, in the last year, maybe year and a half, we have put more emphasis on that channel. There is a kind of a long lead time in terms of getting into those places, getting them on your program and getting product. So as of now, those efforts haven't really moved. It's really not part of the top line growth that Jon mentioned earlier, the 20%. But again, we think it's going to be a pretty good base as we go forward. And once you get kind of a critical mass in terms of a dealer network, it can start to contribute meaningful numbers. But we are not there yet.

Sure. One last one, guys -- John, I think it was your comments -- I want to make sure I understand. Your 5% to 8% revenue growth, which you think may have some upside given Q1, especially for the year, was incorporating a 10%-ish rebound in new build activity, or was that in overall housing turnover? Help me understand how you're getting to that forecast.

That was 10% in new construction and a relatively flat remodel scenario.

Okay. And, gosh, that 10% -- is that your share? Is that more of an increase internally, or is that a market dynamic here?

Market.

Okay, all right, guys, thanks, best of luck.

Jarrod Rapalje, Longbow Research.

Just a couple of questions here -- obviously, a lot of talk about the cautious consumer on large ticket purchases lately. Could you kind of just comment on how that evolved through the quarter? Obviously, the 20% growth doesn't really reflect that. Did that ease as the quarter progressed, or how did that turn as it went into August here?

Well, again, it's very -- because the seasonality of our business, it's pretty difficult to draw conclusions even in a normal year. It has been awhile since we've had one, but you're going to get a pretty significant drop as you come off the spring selling season, about mid-May. You go into July and August, and quite frankly, people are on vacation and they are worried about a lot of things other than remodeling their kitchen.

So we would normally expect that as we went through kind of the quarter that we would go from high to low, that we would get a downward trajectory in terms of demand just from a seasonality standpoint. And we saw that; there's no doubt about the fact that we saw that.

So the question on consumer confidence -- but as Jon related, and some of the recent statistics have come out, we quite frankly wouldn't see that in July and August, anyway, because it's a very, very low period of demand for the business, particularly on the remodel side -- new construction a little bit, but really on the remodel side.

So the question is -- does that spill over into the fall selling season, which generally begins about the middle of September and runs through the middle of November? And again, as I mentioned before, that's the $64 question. So we don't know. What we are seeing out there, our general feel is what we are seeing out there in the stores and on the street is that there's still activity. People are still coming in. We are still -- the designers in the stores are still designing kitchens, they are quoting kitchens. The question is, when -- particularly when the incentives come back on here a little bit after Labor Day, do people actually come in and sign on the dotted line, turn their money over and get on with their project?

But so far, the pattern is not different than we would have expected. And we, to date, really haven't seen anything related to consumer confidence that's other than what we anticipated.

Okay, that's helpful. Secondly, well, first off, could you quantify the raw material pressure during the quarter? And then on top of that it seems like some of your competitors have gone through some price increases earlier in the year, and you guys held off. Are you pushing through some price increases now, and should we expect to see some in the second half?

I'll take the material side; I'll let Kent comment on the pricing. On the materials side, we've been seeing pressure really throughout this calendar year in the categories that I mentioned earlier in my comments. Hardwood lumber had been hanging in there really for a couple of years at pretty low levels, and that has been rebounding. Pricing has been rebounding in hardwood lumber. And then the other categories have imported components; there's been a lot of a lot of price inflations, and certainly on petroleum-based products like paint, for instance, we've seen a lot of pressure as well. Of course, the increase in diesel fuel has been pretty well chronicled too. And although that is starting to ease now, it's still much higher than it was at this point last year.

So I don't know that we've actually got a specific percentage that we've quantified in terms of the overall increase. But I guess if I had to put a range, I'd call it probably low- to mid-single digit inflation in material inputs.

That answer your question on that side?

Yes. And then on the pricing, are you guys pushing through some price increases here in the second half?

Yes, we have historically. We don't comment publicly on our actual -- on any pricing actions that we may or may not take. I'll kind of give you historically what we have told people, and that is that this is an industry where sustainable, real raw material increases that are out there that are sustainable as opposed to some of the spikes that we see for a variety of reasons -- that over time the industry has proven an ability to pass those through the channels of distribution to the consumer. And there may be a little bit of delay of a few quarters or whatever it is.

So we price to market, and to the extent that the market reflects that over time, we will support and be consistent with the market from a pricing standpoint. We are a value price point player, and so we are very, very conscious of that and we make sure that we maintain our value-price position for what we do. We are not the high-feature player, we are the value player. So we make sure that we maintain that position. And again, over time, we reflect the pricing in the marketplace.

Okay, thank you.

Peter Lisnic, Robert W. Baird.

This is Josh Chan filling in for Pete. It sounds like you guys exceeded your own expectations on the share gains. Could you just talk about the particular areas where you exceeded your own expectations?

Josh, they were really in both areas. I'd say that on the remodel side, certainly we didn't expect to do north of a 20% comp over last year. And on the new construction site we had a difficult comp because, a year prior, the expiration f the federal housing stimulus program came sort of right at the end of our fiscal year. And so last year's first quarter included shipments of orders that came in at the very end of that program. So last year was a pretty strong comp for new construction, and we managed to exceed that. So I would say that we probably exceeded in both areas a little bit.

Okay, that's great. And then on the promotional environment, you mentioned an expectation of that being relatively stable going into the next quarter. If market growth were to turn negative or deteriorate, could you judge the likelihood of an acceleration in promotions just by competitors who drive volume?

Well, yes, you are in a dynamic environment so, of course, anything is possible out there. What I would say, though, is that generally speaking there's about a two- to three-month window. When you put together promotional schedules, particularly in the retail environment, there's some planning that has to take place between us and our customers in terms of setting the programs up, getting the programs advertised, getting them out in the stores, all those other types of things.

So we have a pretty good look through a good chunk of the fall here in terms of what the promotional schedules are going to be. And you know now, of course, somebody could come in and try to do something on a short-term basis. But generally speaking, going through the fall, we think that the promotional schedules all the way through to the consumer are going to be pretty consistent with what we've seen. And the reality of the timing is, if they are not going to be successful and they are not going to drive the volume that we want or that the industry wants, by the time you figure out that it didn't drive volume, quite frankly, the cow, the horse and the pig are already out of the barn and you have missed the selling season, and all you can do is try to look at the next season, which would be the spring, and gear up.

So once you get to the front end of one of the seasons, you are pretty much where you are going to be for that season because your reaction time is pretty much taken away from you.

Okay, I see. And then finally, you mentioned some growth in the dealer channel. Is there some sort of metric that you can give us like number of dealers you have now versus three years ago or something like that that kind of shows that trend?

Not that we would release publicly. We are out there putting some more emphasis on the channel, whether it's picking up new customers or whether it's gaining share with the customers that we already had. But again, that's some competitive information that we're not going to release publicly.

Okay, definitely understand. Thank you very much for your time.

Robert Kelly, Sidoti.

Question on the promotional environment -- Kent, you just mentioned, if someone comes in with a short-term program to try to drive volume -- is the plan for American Woodmark to continue to match any competitive price programs put out by competitors?

Well, we have done a mixture. The ones in the spring that came on we did not match. So what we do, as I think everybody does -- I'll speak for ourselves -- is that whenever the landscape changes for a promotional period -- two, four, six weeks, whatever it is -- we go in and look at what it is, what it does to our positioning, particularly our value price point, and then we decide on our response.

Sometimes in the short-term we do match; sometimes we don't. Again, it just depends on a variety of factors. Over time we have made the statement and will continue to make it that we are not going to let a competitor buy our share over time. We're going to compete on a level playing field. But that doesn't mean that, for any one particular promotional period -- weeks, months, whatever it is -- that we might decide not to match, for a variety of reasons.

Okay, great. And then, just as far as the push into the dealer channel, I understand that the bulk of promotion expenses is tied to what's going on in the retail big box channel, but there's also some drag -- or my assumption is that there's some drag as you try to push into the dealer channel. Is that correct? And is there any way to split out how much promotional drag is coming from retail versus your push into the dealer channel?

I'm not sure what you mean by promotional drag. First of all, our dealer business in relation to our big box business and our new construction business is pretty small. So it's not going to move the needle in the near-term one way or another. The other thing I would say is that the market is relatively efficient in the sense that consumers know where to buy cabinets; they know where to shop for cabinets. And so it's relatively efficient in terms of the pricing across channel platforms, is pretty similar, the net pricing. When you get to it now on the dealer side, they do have a higher service platform, just because of the nature of the way they go to market. So they can get a slight premium for that.

But generally speaking, when we get into -- as long as you're going after remodel customers from a manufacturer standpoint, the net to us is pretty consistent across channels.

Okay, great, that's helpful. And you said it's not a material portion of your business, the dealer channel. Is there a five-year goal as far as percent of revenue you would like that to be? Or are you just going to take it as it comes?

No, we have internal goals.

Care to share them?

Internal goals.

Got you, thanks guys.

Keith Johnson, Morgan Keegan.

It's just a couple questions -- thinking about your comments regarding kind of easy comps year-over-year as we look at the first half, as we go to the second quarter this year how should we think about the seasonal aspect as you kind of go into that fall selling season and kind of compared on a sequential basis to how well you guys did in the first quarter? Did you guys think you are pulling demand forward on some of these promotions, or do you think that that promotional environment is going to keep at -- I know you don't know now, but do you think that at least the trends are that those consumers are going to continue to show up for these promotions? We are now four quarters in, and that seems to be the case fairly consistently, even though we have had ebbs and flows in kind of the economic activity and uncertainty levels out there.

Yes, I would say that virtually none of it has been pulled forward. And again, most of what happened, seasonality, a lot of our sales and shipments in our first quarter were really things that were booked, sales that were booked in April and early May, just because of the nature of the seasonality. And the idea that somebody would buy a kitchen in April or May when they really wanted to do their remodel in October is a bit of a stretch from my way of thinking.

So my guess is very, very little of it from a quarter or a season standpoint is pulled forward. Now, that doesn't mean we're not moving volume around onto Friday or the Saturday or the Sunday or whatever that they actually close out a promotion. You'll get a spike at the end of that week and a valley the week following. But when we get to quarters or half-years, there's not a lot, in my opinion, of that kind of movement that comes around. There's not a lot pulled forward. So again, the question is how many people this fall are going to feel good enough about going in and actually completing the project in the sense that they placed the order?

As I mentioned, we have reports from the field. What we see in the field is good activity in terms of traffic, good activity in terms of people working on designs and issuing quotes. The question is -- are they going to part with their money? When we get into September, October, November, are they actually going to part with their money to do the project?

If you kind of took a look at where you stand today, so (inaudible) Kent, anecdotally can you give us some color around the orders that you're kind of seeing already on the books as you kind of look into the second quarter? Are we in kind of a period where we potentially see another 15%-20% year-over-year comp and kind of what you guys are showing on the revenue line?

Well, as I said, we expect it will be higher than 8%, certainly. Will it be mid-teens or higher? We will have to see, as Kent said.

Yes, one of the difficulties we have at any time, but particularly just because we've come off the spring selling season, we are now kind of in the depths of the summer, is generally speaking, in terms of our backlog and the lead times that are expected by our customers and the end consumer, is generally we only have about a 2 to maybe 2.5-week view of backlog. And so what we really depend on is the season, once we get into it, to kind of carry us through.

So that being said, our backlog is better than it was last year. But from a seasonality standpoint it's low, and it's only a couple weeks worth of business.

Okay, great, thanks a lot.

And with no further questions in the queue, I would like to turn the call back to Glenn Eanes with any additional or closing remarks.

Thank you. Since there are no additional questions, this concludes this conference call. Again, thank you for taking time to participate. And speaking on behalf of the management of American Woodmark, we appreciate your continuing support. Thank you.

This does conclude today's conference. We thank you for your participation.