Good day, ladies and gentlemen, and thank you for standing by. We welcome you to Armstrong World Industries Fourth Quarter 2018 Earnings Call. [Operator Instructions]. As a reminder, this conference call may be recorded. I would now like to turn the conference over to Tom Waters, Vice President of Corporate Finance. Please go ahead, sir..

Thank you. Good morning, and welcome. Please note that members of the media have been invited to listen to this call, and the call is being broadcast live on our website at armstrongceilings.com. With me today are Vic Grizzle, our CEO; and Brian MacNeal, our CFO.

Hopefully, you have seen our press release this morning, and both the release and the presentation Brian will reference during this call are posted on our website in the Investor Relations section. I advise you that during this call, we will be making forward-looking statements that involve risks and uncertainties.

Actual outcomes may differ materially from those expected or implied. For a more detailed discussion of the risks and uncertainties that may affect Armstrong World Industries, please review our SEC filings, including the 10-K filed earlier this morning. Forward-looking statements speak only as of the date they are made.

We undertake no obligation to update any forward-looking statement beyond what is required by applicable securities law. In addition, our discussion of operating performance will include non-GAAP financial measures within the meaning of SEC Regulation G.

A reconciliation of these measures with the most directly comparable GAAP measures is included in the press release and in the appendix of the presentation. Both are available on our website. With that, I will turn the call over to Vic..

Plasterform, a manufacturer of ultra- expressive glass fiber reinforced gypsum ceilings and walls; and Steel Ceilings, a producer of metal ceilings, including specialty radiant and security-type ceilings. Combined, they added 700 basis points to segment growth and added important capabilities and capacity to our specialty ceilings and wall portfolio.

In the Mineral Fiber segment, AUV grew 6% as like-for-like pricing once again outpaced inflation. And our new high-end product offerings, including Total Acoustics, Sustain and DESIGNFlex, helped to drive positive mix gains.

Sales of these high-end products grew high single digits as the market continues to demand superior acoustical performance and products that are free of Red List chemicals. Overall, Mineral Fiber volume for the year was positive.

Other highlights in 2018 included receiving the cash from the pending sale of our international businesses, a majority of which we returned to shareholders in the form of a $150 million accelerated share repurchase program. We are increasing our expected net cash received from this transaction by $30 million to $280 million.

We now expect this transaction to close in the second quarter. In 2018, we also further optimized our manufacturing footprint and rightsized our SG&A to reflect our new Americas-focused company. Closing our St. Helens plant and opening a distribution center in Phoenix not only drives savings, but it also improves service to our West Coast customers.

The restructuring savings created by these actions will continue to benefit us in the first half of 2019. And finally, with continued confidence in our strategic initiatives and future cash flow, we instituted a regular quarterly dividend in the fourth quarter.

All in all, it's been a strong year for AWI, and I'm proud of our employees and their great work. And I want to thank our team and our partners for their commitment to building this foundation for growth and for their execution and delivering on our full year earnings guidance.

So with that, I'll pause and turn it over to Brian for more details on the financial results, and then I'll be back to preview our 2019 initiatives and our market outlook.

Brian?.

invest back in the business and high-return projects, acquire businesses that add to our capabilities and enhance our portfolio, pay a regular quarterly dividend, repurchase shares, a balance of investing in the business and returning cash to shareholders.

During 2018, we invested $72 million or just over 7% of sales in capital expenditures, made acquisitions with a total purchase price of $22 million, initiated a $0.175 per share quarterly dividend and repurchased $307 million of stock.

To date, including year-to-date in the first quarter, we have repurchased over 8 million shares for $450 million at an average price of $56.18 per share. Slide 10 is our total company EBITDA bridge for the year. Price, volume and mix all contributed to improved profitability.

Input costs, including freight and raw materials, were higher throughout the year. Productivity in our plants contributed $6 million above prior year even as we consolidated manufacturing and logistics and absorbed the production expenses of the 2 newly acquired companies.

For the year, SG&A and WAVE were impacted by our allocation methodology change in 2017. Slide 11 shows full year free cash flow excluding the net proceeds from the sale of our international business, environmental recoveries and expenses and the purchase price of acquisitions.

Operating cash flows, lower capital expenditures and WAVE dividends were the highlight of our record year in cash generation. Slide 12 provides our initial 2019 guidance.

Consistent with the value-creation model we unveiled at our Investor Day last November, we expect top line growth of 7% to 10%, driven by volume gains in Mineral Fiber, from our new products and sales initiatives, continued AUV expansion, greater than 15% organic growth in Architectural Specialties and the impact of 1 to 3 acquisitions.

Adjusted EBITDA will grow by more than 10% as the fall-through of the sales growth is coupled with continued productivity gains, the second half of our restructuring savings and earnings growth from WAVE. EPS will grow even faster as we achieve leverage on our interest expense and depreciation expenses.

We are holding share count at current levels for EPS guidance, and we'll update the share count throughout the year. We estimated 25% book tax rate but intend to report on an actual tax basis starting in the first quarter. Finally, we once again expect free cash flow to be in excess of 20% of sales.

2019 free cash flow will be fairly consistent with prior years but will not have the benefit of the $25 million WAVE special dividend paid in 2018. I know many of you are building financial models and we do not provide quarterly guidance, so I wanted to make a few observations to help the flow.

2019 will have 1 less shipping day than 2018, 1 less in Q1 and Q2 and 1 more in Q3. A shipping day is worth about $4 million in sales and about $2 million in EBITDA. Also, we continue to expect expenses associated with the Rockfon litigation.

We will continue to exclude these expenses from our adjusted EBITDA as they are not reflective of our ongoing business. To close, I'm pleased with our strong results in 2018. We accelerated growth, expanded margins and improved on best-in-class cash flow generation. I'm confident in our 2019 outlook as we've built a solid foundation to build upon.

We have clear and well-understood initiatives, and we have yet another acquisition to fuel our growth and profitability. We will continue to deploy our cash to build a better business, and we will return cash to shareholders through our dividend and share repurchase programs. With that, I'll turn it back over to Vic..

Thanks, Brian. As we look forward to 2019, I refer back to the 4 pillars for building a stronger business that we shared at our Investor Day back in November.

We emphasized revitalizing the Mineral Fiber category, accelerating growth in Architectural Specialties, embarking on a digital transformation and continuing our strong cash flow and capital allocation. Revitalizing the Mineral Fiber category hinges on our new product innovations.

The performance and design features we are bringing to market are enabling architects and designers to think differently about how and where they use mineral fiber in ceilings.

In the fall, we launched our revolutionary DESIGNFlex ceiling system, which provides an array of shapes, sizes and patterns in any color and, maybe most importantly, with standard lead times. This new product and service offering has inspired considerable market excitement, further advancing Armstrong's position as the design and service leader.

And to continue this innovation leadership, in the spring of 2019, we will be launching AcoustiBuilt, a new seamless mineral fiber ceiling that is an acoustical alternative to drywall with standard drywall installation methods. These exciting new products are changing the paradigm in mineral fiber ceilings and revitalizing the category.

As for accelerating Architectural Specialties, you've likely seen our recent announcement that we've agreed to purchase Architectural Components Group or ACGI, a leading manufacturer of wood walls and suspended wood ceiling systems.

The fast-growing wood category is strategically important, and this acquisition further strengthens our market-leading position in wood. We intend to make ACGI our center of excellence for wood manufacturing and design. And ACGI will add $20 million to $25 million to our sales in 2019, further accelerating Architectural Specialties growth.

And finally, we've begun a digital transformation. We are investing in technology as an enabler of the next level of differentiation for Armstrong in the market and to delivering the next level of productivity.

We are striving to provide a frictionless customer experience, shorten design lead times, drive the next wave of productivity in our plants and provide the backbone to facilitate rapid growth in Architectural Specialties.

Our early initiatives are exciting our customers on the possibilities, and you can expect to hear more about these initiatives in our future updates.

Now Brian provided the specifics of our guidance for 2019, and I'd like to take a moment and add a little more on the underpinnings to those numbers and why we remain confident in our value-creation model and in 2019, specifically. First, we expect the commercial construction market in 2019 to be similar to what we experienced in 2018.

Repair and remodel activity, which makes up about 70% of our sales, has improved, with some movements across the end markets. We expect health care and education end markets to improve slightly and office to moderate in 2019.

New construction starts, which impacts our sales on a 12 to 24 month lag, have been positive and fairly consistent over the past 2 years, indicating similar sales volumes in 2019.

Additionally, the conversations I've had with distributors and contractors over the last several months in terms of their backlogs and their quoting activity continue to reflect the cautious optimism out in the market.

Second, our backlog in Architectural Specialties is solid and gives us confidence in another year of double-digit organic sales growth in that segment. On the Mineral Fiber side, we continue to see unprecedented adoption rates of our Total Acoustics and Sustain family of products and expect those platforms to continue to outpace the market.

And DESIGNFlex is just getting started. Coupled with our targeted go-to-market initiatives, we expect to drive positive volume growth in the Mineral Fiber segment. Connected to these initiatives, we have a proven track record of growing AUV and achieving price greater than inflation, and we expect to continue that performance in 2019.

Thirdly, on the cost side, our plants are running well and are focused on continued productivity improvements. The St. Helens closure benefit and the SG&A reductions that we did in 2018 will carry over to the first half of 2019. And finally, WAVE is performing well, driving price over inflation and is well positioned to once again grow earnings.

So our comments and 2019 guidance comes from the fact that all the points I just listed, other than the steady market, are within our control, and we have the plans in place to execute. And that's why 2019 is going to be another exciting year for AWI. So let's pause there, and with that, we'll be happy to take your questions..

[Operator Instructions]. And our first question comes from the line of Phil Ng with Jefferies..

AUV accelerated very nicely last year. Certainly, you had an inflationary year, but just curious, how was it split between price and mix? And how do you envision that mix and AUV momentum playing out in 2019? A big part of the reason why I'm asking is because you've obviously made some nice investments to kind of revitalize Mineral Fiber.

Just trying to gauge how DESIGNFlex or some of these digitizing efforts is being adopted and what kind of impact it could have in the coming years..

Yes, Phil. This is Vic. The mix of price and mix, as we've talked about, really, over the past 8 to 10 years, has been pretty consistent, balanced between price and mix, so about a 50-50 mix. And 2018 was really no different. We had higher levels of AUV improvement versus the prior few years, so we're very pleased with that result.

But the mix between price and mix, product mix, was 50-50. That's pretty good proxy. And I think going into 2019, even though we're making investments on innovation and driving, it's supporting that continuation of mix improvement.

And I think in an inflationary environment that we're anticipating to continue in 2019, I expect this mix to be pretty similar to what we've experienced over the last several years..

Got it. And then growth in your AS business has been really impressive.

But can you just kind of give us a sense where you are in the penetration rate side of things and where you see that kind of shaking out the next 3 to 5 years? And was that glide path, is this mid-teen-type organic growth rate sustainable over that time horizon?.

Yes. In Architectural Specialties, as we've talked about, again, it's very fragmented. We've done four acquisitions to date. And I would just characterize it as we're in the early innings still of participating more broadly in architectural specialties space.

So certainly, for the next 3 to 5 years, I expect double-digit earning -- or double-digit sales growth and penetration in that segment is a good way to think about it..

Got it. And just one last one for me.

What were some of the drivers for higher SG&A expenses that kind of dinged you up a little bit in the fourth quarter? Will that kind of spill over into 2019? And specifically, I'm really focused on your thoughts on how to think about SG&A and margin for AS just because the growth has been quite robust, but SG&A expense, which -- I'm just kind of curious how that's going to impact margins going forward..

Take this, Brian..

Sure. Phil, it's Brian. So in the quarter, at least, we had some SG&A headwinds around the acquisitions, right, because we're integrating them still, and then we also did invest.

As we look forward, we'll continue to make investments in that business around the capabilities and capacities to fuel that greater-than-double-digit organic growth we've outlined, greater than 15%. So there will be -- continue to be some modest investment in SG&A in the AS segment, specifically.

But again, we are focused on annual profit growth and margin expansion..

And our next question comes from the line of Michael Wood with Nomura Securities..

First question, I wanted to just get some information on this AcoustiBuilt. Is this a wall or a ceiling product primarily? And will that get reported in Specialty or Mineral Fiber? Curious if this is something that you think will be a quick adoption.

Or is this the type of product that might take time to educate customers?.

Mike, this is Vic. So the AcoustiBuilt product is primarily for the ceiling and will use very typical drywall installation methodology that you use in the ceiling. So that's very encouraging, I think, for the trades. We're in a -- going to be in a soft launch here in the spring, so it's kind of early to say what the adoption rate is.

But I can tell you the excitement that we have seen already as we've introduced this product, again, in a soft way has been very exciting. So I wouldn't be surprised to have a nice pickup in demand on this product in the second half of the year. And this will be in our Mineral Fiber segment and capture just a part of our Mineral Fiber sales.

And this is part of our initiatives on how do we expand and sell more mineral fiber into more spaces to grow that business. And this is a great example of the innovation that's going to enable that..

Great. And can you give some more color on that? I think you called out $6 million increased SG&A in Mineral Fiber on selling initiatives. You've made some efforts in the past to help support growth in Mineral Fiber.

Has it necessarily been evident in the volumes that you've reported in that segment? So just some clarity on those and confidence that they'll pay off..

Yes, Mike. We mentioned overall SG&A was up in the quarter, but all that was being driven by the investments in AS and the acquisitions that we purchased..

And our next question comes from the line of Keith Hughes with SunTrust..

You had some inflation, not a lot but some inflation, that took away some of the EBITDA.

Could you just talk about what your view on inflation is the next couple of quarters?.

Yes, Keith. Inflation was primarily -- and it was broad-based in 2018, but it was primarily in the area of freight for us. And there's nothing structurally changing that would change that dynamic, so we're expecting freight inflation to continue into 2019. I think the other raw materials inflation should moderate is our expectation.

So we will have an inflationary environment, and I think it's going to continue to be driven by the freight side..

With same or similar magnitude of what we saw in the fourth quarter?.

Yes. I would say that's probably a pretty good run rate overall..

And our next question comes from the line of Kathryn Thompson with Thompson Research Group..

The first is just a follow-up on guidance. 2019 guidance implies a fairly sanguine outlook, and I appreciated your additional color on the bridge for the why behind the high single-digit volume gains.

But could you focus a little bit more on how growth is driven by core market versus new products versus potential acquisitions and just giving some -- a little bit more color how we should think about that bridge throughout '19?.

Brian, do you want to take that?.

Yes. Kathryn, it's Brian. So in the Mineral Fiber segment, modest volume growth, 0 to 2%, and then AUV should be in that 5%, 6% range. As you think about the acquisitions, we did recently announce the acquisition of ACGI. We haven't closed on that yet.

But as Vic mentioned, that will add $20 million to $25 million to the top line of that AS segment, coupled with continued organic growth of greater than 15%. So they're key drivers of reasons to believe, I'd say, around our guidance for the top line..

Okay, great. And just a follow-up on transportation. Based on our conversations in the field with people who are dealing with the same challenges you are with transportation, we are finding that, while it remains a challenge with drivers, availability of drivers and just availability of access is a little bit better going into 2019 versus 2018.

I just wanted to see if you're seeing a similar trend.

And then as you think about a little bit of inflation on transportation, is it really primarily on the labor component or fuel? Or is it -- what makes it maybe?.

Yes, Kathryn. It's Brian. So on the inflation question, we see more on the labor side. We have been able to increase -- now that we've got the DC in Phoenix set up, we're able to increase the percentage of our business that's on contracted rates. So that, for us, specifically will help alleviate some of the inflation headwind we saw in 2018.

But we do see, as Vic mentioned, no real big structural change in that component of our inflation line. And we continue to work on increasing the percentage of our business that is on contracted rates, which tend to be double digits below the normal CAS rate.

So no real significant change on the freight side of this, but we do start to see in raw materials some abatement..

And our next question comes from the line of Nishu Sood with Deutsche Bank..

This is Marius in for Nishu. My first question, I just wanted to ask about ACGI.

Could you give us -- could you tell us more about the acquisition?.

Yes, happy to. This is a very exciting player in the wood ceilings and wall market today. They are -- one of the most impressive things that we like about this acquisition and it brings to Armstrong is the capabilities that they have around manufacturing wood, from creating radiuses to perforations.

So in overall design and manufacturing capability, that's really going to add to Armstrong's current capabilities. Again, around $35 million in sales. So they're a nice, meaningful player in the overall space with great customer relationships and a great group of employees. So we're excited about it.

And we think, again, as a center of excellence for Armstrong, we can really build on this platform with the reach that Armstrong brings to a smaller company like this to really extend our participation in this segment..

And my second question, it looks like you are increasing your CapEx spending.

So maybe can you give us -- can you tell us about some projects that you plan to work on this year?.

Sure. So we've launched a digitalization effort. So some of that increased CapEx, it's pretty minor overall but is related to that digitalization journey that we're on as we start to accelerate and support the acceleration of growth on the top line and then drive productivity, both in the manufacturing and SG&A cost elements..

And our next question comes from the line of John Lovallo with Bank of America..

The first one is it sounds like you're still comfortable with the $10 million of incremental manufacturing and SG&A cost savings in 2019.

Can you just help us with the mix between manufacturing and SG&A and then, maybe more importantly, just kind of the cadence, the quarterly cadence throughout the year?.

John, it's Brian. So the $10 million in total should be first half. I would -- I'd say more than half of it is manufacturing, 60%, 70%. And we'll continue to see some productivity in our SG&A as a result of the restructuring activities we took, balanced, though, with investing behind AS and the capabilities and capacity to fuel that growth..

Okay, that's really helpful. And then if I missed this, I apologize, but the retail channel for Mineral Fiber, how did that perform throughout the quarter? If I remember correctly, it had a pretty good start in October.

How was the carry-through there?.

Yes, we had nice -- and the retail segment, just to clarify again, is the Big Box we sell through. It's like really a channel, right, that we sell into the Big Box retailers, just to be clear for everybody. And we had nice double-digit growth there in the quarter..

Okay, great. And then lastly if I could. The acquisition of Architectural Components, the $20 million to $25 million is contemplated in your current outlook.

Is that correct?.

Yes, that's correct, John..

And our next question comes from the line of Ken Zener with KeyBanc..

So your guidance, I just want to look at EBITDA, the midpoint guidance as it relates to sales and margin and if you could, perhaps, discern the -- it's about a 170 basis point increase year-over-year in EBIT margin -- EBITDA margin.

How does that kind of play out in mineral wall versus architectural? And I'm just wondering if you could give us a little cadence there, yes, for the year because I just want to see that we don't have -- or we're prepared for quarterly volatility, just so we can understand where you're really kind of shooting at.

Like is architectural going to be flat, down 50 bps, like it was in '18? Or do you expect that to be up or all the gain to occur in ceilings? I just want to make sure everyone's kind of set to the same bar, if you could..

Sure, Ken. This is Brian. So first of all, AS did see overall margin -- EBITDA margins expand in 2018 modestly. We continue -- expect that to continue. So think about 20 to 50 bps of margin expansion in that AS business. And then as we roll forward some of the restructuring savings, all of that is in Mineral Fiber.

And so the EBITDA margin improvements will be benefited by that restructuring..

I do appreciate that. Does it -- I believe I was saying it right. Is it AcoustiBuilt, what you just talked about, Brian, for the ceiling....

Yes, AcoustiBuilt. AcoustiBuilt..

Yes, and Vic?.

Yes..

Big category, big category there. Can you give us a little sense about what that means in terms of the markets that it served in terms of square footage today for drywall, if you're really only able to service 5% or 10% of that because the premium is -- if you could help us what the premium per foot is.

And yes, just give us some -- that seems like it could be a pretty interesting category in time..

Yes, it's a very interesting category. And again, there's a need out there for that smooth, white look that -- with some acoustical performance. So there's really a pendulum swing back from just aesthetics without acoustics to having both aesthetics with acoustics. And so it's a very interesting category.

It's a category that could continue to expand over time. And so not to get too specific with numbers and so forth, it's a meaningful segment today, and we believe it will continue to grow as we demonstrate this capability of both aesthetics as well as acoustics. And again, the -- it's going to be a higher cost point than pure drywall.

Obviously, the performance is much greater than pure drywall. But it's at a very attractive price point for the combination of performances, and that's been some nice feedback from the market on that. So we're excited about the category. Probably more to come on this as we're in a soft launch period of this product. But we'll keep you posted on it.

But again, a very exciting segment..

And then if I may, Vic, you talked about office being flat, down.

Given that that's probably about 1/3 of your end market, albeit on R&R, could you quantify, is that like a 1 point of volume contraction? Or how should we think about that?.

Thanks, Ken. Yes. I wouldn't put a number on it. I think what we're going to see is some of the activity moderate from the nice growth that's really been fueling the growth in 2018. But on the new construction side, as I referenced in my talking points, the 2017 and 2018 activity had been very consistent.

And therefore, the lag effect on those new starts should carry over nicely into 2019. So it's a real moderate point in terms of the expectation in office. And I would just leave it at that as not a significant volume contributor..

And our next question comes from the line of Stephen Kim with Evercore ISI..

A couple of questions that I have, just housekeeping items, I guess, related to the volume this quarter. We have been expecting home centers pushed out from 3Q into the 4Q to add maybe 50 to 100 basis points. I just want to make sure that, that was kind of in the ballpark of sort of what that timing differential added.

And then the extra shipping day, that was a couple of hundred basis points as well, I'm guessing. So I guess that's my first question..

Well, on the retail, no surprise there. What we outlooked in October is what we saw in the quarter. It was a nice double-digit growth quarter offsetting some of the shortfall we talked about in the third quarter.

Brian, do you want to take the second half?.

Sure. And so yes, as you can imagine, 1 extra shipping day in the quarter does add a little momentum, call it, about 1 point, 1.5 points in Q4..

Okay, got it. All right.

So would it be fair to say that the -- if you were to adjust for these two factors, that your volume was still up year-over-year in the quarter? And can you give us a sense for what 1Q on volume is looking like, what the run rate is, whether it's kind of in the range of your annual expectations or a little above it?.

On your first question, absolutely. We believe when you compensate for those 2, we still had nice positive volume growth in the quarter. As far as what we're seeing so far, January and February, we like what we see. It's really exactly where we had expected and outlooked to be.

And it's consistent with the guidance that we're outlooking for the whole year. So I'd say everything is go, and we like what we see so far..

Awesome. You also mentioned, I think, in your prepared remarks that mix, the impact was favorable, not just because you had Sustain and Total Acoustics helping you out, but also, I think you said the lower end of your line also saw some strong price.

And I was just wondering, was there anything unusual or anything -- not unusual maybe but particularly worth calling out with respect to how price performance of the lower end was a little different maybe this past quarter than in the previous quarters or what we could expect going forward?.

No, I don't think so. Just to the contrary, I think pricing was pretty consistent across the entire portfolio. And there might have been a misunderstanding in some of the talking points around that, but as far as pricing goes, no big difference on pricing realization across the portfolio..

Okay. So it was pretty consistent. Great. And last question for me is DESIGNFlex. You indicated that you're just getting started, which is encouraging.

I was wondering if you could quantify just kind of generally what you think DESIGNFlex potential impact might be versus what you see in Total Acoustics and Sustain and then maybe what kind of time frame it might be before we can really see what DESIGNFlex can add to the top line..

Yes. I think in DESIGNFlex, it's reasonable to expect it to take a little bit longer term in terms of the adoption and the penetration in the market because it is -- it has to be designed and specified into spaces in which it's going to go. I mean, Sustain and Total Acoustics are of the same format, right, and are very much interchangeable.

So we've had a much higher adoption rate, which is, again, reasonable there. So I would expect it to be a little slower ramp in terms of impact on the top line with DESIGNFlex..

And our next question comes from the line of Garik Shmois with Longbow Research..

So most of my questions have been answered, but I just want to just ask one more question on Mineral Fiber volume growth.

And just excluding the timing of the shipping day impacts over the next several quarters, just wondering if you could speak to how we should expect the cadence of volumes to progress and if there's anything to call out, recognizing that there's some channel fill in retail in Q4.

Is that at all impacting the timing of volumes in Q1? And if education is something that's looking like a potential bright spot, would that potentially mean that there could be some volume benefit in the back half of the year?.

Yes, it's really hard to outlook this quarter-to-quarter cadence, especially by segment, so we'll try not to do that. But I think what I'm a little bit more optimistic about this year versus prior years has been is the activity in education and health care, which has been a bit of a lagger over the last several years.

And really, the growth that we've seen has been driven by the office segment. So I'm encouraged by strong education, new construction starts in 2018 in the primary education area, so the K-12, which is a nice segment for us.

The state-level growth is nearly in all 50 states in terms of the expansion, and again -- so that broad-based nature gives me a little more optimism in the outlook as well. So I think office -- or education and health care, I'm looking for a little bit more contribution from them in 2019 than we've seen in the prior couple of years..

Okay.

And is there any mix considerations as you start to see a shift more towards some of these institutional categories away from office that we should be considering?.

No. I think we would expect to sell high-end products and the low-end -- and the kind of the broad product portfolio in each of these segments. And so I wouldn't expect a meaningful shift in the mix based on this..

And I'm showing no further questions at this time. I would like to turn the call back over to Vic Grizzle, Chief Executive Officer, for closing statements..

Just a quick thank you for everybody attending and for the questions. As you can see, we're excited about 2019, should be another strong year in advancing our company forward. So thank you again for your interest, and until our next update. Have a good afternoon..

Ladies and gentlemen, thank you for participating in today's conference. This does conclude today's program, and you may all disconnect. Everyone, have a great day..