CTS
#I would tell you, <UNK>, that getting to that high-end of the guidance on the revenue side is ---+ I don't see it; I see us more at the middle to ---+ middle of the guidance to a little lower, and markets would have to be very strong.
HDD would have to come back really well, and I don't see that happening in that market at the moment.
I know that Western Digital reported yesterday, and other customers, and I haven't had the chance to read the reports.
So, we are in the low-single digit growth rate for the year in total.
We expect ---+ our guidance includes that HDD is weak.
And I would tell you, <UNK>, as we look out at the growth of the Company over the next several years, two or three years, we've really looked at that and said, hey, we're going to dampen our expectations and still grow.
Yes, mostly ---+ some of them were on our OCXO products, frequency products.
So they go into some communications, some industrial applications.
And then also our non-HDD piezo products, which go into military applications, going to medical applications ---+ we're doing pretty well.
We've seen very nice growth rates there, but being offset by the HDD headwind.
We are targeting mid-single-digit growth on an organic basis, and we want to complement that with acquisition.
We've ---+ obviously it's got to be the right acquisitions.
We've always said we are targeting an overall growth rate of 10%.
We haven't backed off on that, but we're not going to do ---+ rush into any acquisitions.
We've got to have the right ones to make that happen.
And then on the market side, the numbers that Kieran just talked about, that assumes a relatively stable market position.
Yes.
<UNK>, we track that very closely.
When we look at it, we are roughly tracking about 5 or 6 points ---+ percentage points behind where our goal would be.
It's all a matter of timing.
Some OEMs decide to award things, and we've had one or two contracts that slipped, that we thought were going to be awarded this quarter but slipped into the next quarter.
<UNK>, for the rest of 2016, I'm expecting our tax rate to be in a similar range where we are right now.
It has increased from the last year.
And we will be looking at things from an overall perspective in terms of how we sustainably bring it down.
But we are not there yet.
(laughter) My goal is to have some work done on that in the second-half.
So, hopefully, we should be able to provide you more clarity towards the end of the year.
You saved me a question, <UNK>.
(laughter)
Thank you, <UNK>.
You want to take the operating income and I'll take the last question.
So, operating earnings, <UNK> ---+ actually once you exclude some of the items, the unusuals, the gain on the sale of assets and things like that, we are better than last year.
But sorry, excuse me.
We are just about on par but on lower volumes, so the percentages are better, improved from last year.
And on the sales side, we are looking at the sales being down, as we have talked about historically.
On the automotive business, we saw some product lines go end-of-life, and the ramp-up is happening in 2016.
And we have had challenges with HDD as well as some of the telecom market-related product lines in our product portfolio.
Kieran, did you want to add something to that.
Yes.
And then just, on a go forward basis for your question, we see, for the balance of the year, low-single digits, organic growth in the base business.
And we see on the Single Crystal ---+ as we've said, I think, when we announced the acquisition ---+ a double-digit growth around 10%.
March 11 was the effective date of the acquisition.
The $3.1 million in the second quarter is for the full quarter.
Kieran talked about a product line ramp-up in that business that will contribute partially to it.
We don't expect significant seasonality in this business, <UNK>.
Last year ---+ compared to last year, our debt balances are higher, and that's the primary driver of the interest ---+ increase in interest expense.
The (multiple speakers) [total] last year was $90 million.
Yes.
So, <UNK>, if you look at the timing of when the debt went up in the first quarter, the acquisition was closed on the 11th of March.
So that you don't see a huge impact of the interest expense increase in Q1, and we see most of that in Q2.
And we paid down the debt relatively close to the end of the quarter in the second quarter.
So I expect the interest expense to come down slightly from the second quarter level.
You mentioned that you are going to have a new ERP.
How much increase in CapEx should we expect out of the new ERP implementation.
So, <UNK>, in the past, we have talked about a relative range, and it's a pretty broad range at this point in time.
One of the other things we are working on right now is scoping that out.
And I expect it to be well north of $5 million, but I'm not expecting it to go significantly north of $10 million.
So I know I'm giving a pretty broad range, but that's where I expect it to be.
And once we get the numbers finalized, we can talk about it a little bit more in detail.
And we talked about this for a number of quarters in the past, as well, saying that this is on the radar and coming.
And obviously the timing is linked to the simplification of the footprint, so that we are doing it in the locations that are relevant.
2017 and 2018.
Could you repeat your question, <UNK>.
I just want to make sure I got it right.
It will be included in the Q that we will file later on today.
All right.
So, thank you for your participation on today's call.
We are busy and back to work here.
Hope you have a good day.
Thank you very much.
