KS
#Capacity is usually a problem that the industry has with mills and not converting plants.
Converting plants you build where the demand is, and where we can grow our demands, that's where we will do it and it will increase our conversion.
Capacity is an industry problem when it comes to the mills historically.
And with the cost of capital so cheap and there are still surcharges for expedited shipping and stuff like that, so economically it still makes sense to hold higher inventory levels.
The question is we are still running things that we are better off with than without.
The issue is as we grow our integration we will move out of those low margin grains, possibilities whether they be export or paper or board or pulp and to more profitable and to widen the margin.
So, the integration will widen our margin just because we replaced the bottom end of our mill sales.
Well, we don't forecast our EBITDA, but I would say that we are off to a great start when you look at this first quarter compared to year-over-year as far as generating cash and we plan to keep doing that.
So I think our leverage will be coming down rather quickly as we move through the year.
So, yes.
Without predicting we do plan to reduce debt.
Yes.
It is a high priority for us.
Well, once again it all depend on your earnings estimates.
If you look at consensus, if you want to use that, yes we would be moving down substantially.
One more question, please.
When we amended the credit agreement we did a couple of things, but the primary thing is we increased the maximum leverage allowed up to four and a half times and that goes through 2017.
We did that and we changed some of the definitions of EBITDA and cleaned up some other things.
But the primary thing was increasing that maximum leverage ratio and extending it.
So that's what we did.
I mean I don't think we are ever going to be there, but you know, it was relatively, they say the time to ask is when you don't need it, and that's why we asked.
And that's why we got it.
Well, there is a bank definition.
The 3.7 we give you, it is really 3.69, but it is according to the definition and the credit agreement.
There are certain add backs allowed and things not allowed.
So that's why ours might be a little different than yours.
Because of some of the specific allowed either add backs or things we have to take out.
Well, thank you very much.
We appreciate your interest and hopefully we will out perform our hopes.
