Greetings. And welcome to the Titan Machinery First Quarter Fiscal 2020 Earnings Call. At this time all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. [Operator Instructions] As a reminder, this conference is being recorded. I would now like to turn the conference over to your host, Mr. John Mills, with ICR. Thank you. You may begin.

Great. Thank you. Good morning, ladies and gentlemen. And welcome to the Titan Machinery first quarter fiscal 2020 earnings conference call. On the call today from the company are David Meyer, Chairman and Chief Executive Officer; and Mark Kalvoda, Chief Financial Officer. By now, everyone should have access to the earnings release for the fiscal first quarter ended April 30, 2019, which went out this morning at approximately 6.45 a.m. Eastern Time. If you have not received the release, it is available on the Investor Relations page of Titan’s website at ir.titanmachinery.com. This call is being webcast and a replay will be available on the company’s website as well. In addition, we are providing a presentation to accompany today’s prepared remarks. You may access the presentation now by going to Titan’s website at ir.titanmachinery.com. The presentation is available directly below the webcast information in the middle of the page. You will see on the slide two of the presentation our Safe Harbor statement. We would like to remind everyone that the prepared remarks contain forward-looking statements and management may make additional forward-looking statements in response to your questions. These statements do not guarantee future performance, and therefore, undue reliance should not be placed upon them. These forward-looking statements are based on current expectations of management and involve inherent risks and uncertainties, including those identified in the Risk Factors section of Titan’s most recently filed annual report on Form 10-K. These risk factors contain a more detailed discussion of the factors that could cause actual results to differ materially from those projected in any forward-looking statements. Except as may be required by applicable law, Titan assumes no obligation to update any forward-looking statements that may be made in today’s release or call. Please note that during today’s call, we will discuss non-GAAP financial measures, including results on an adjusted basis. We believe these adjusted financial measures can facilitate a more complete analysis and greater transparency into Titan’s ongoing financial performance, particularly when comparing underlying results from period-to-period. We have included reconciliation of these non-GAAP financial measures to their most directly comparable GAAP financial measures in today’s release. The call will last approximately 45 minutes. At the conclusion of our prepared remarks, we will open the call to take your questions. Now, I’d like to introduce the company’s Chairman and CEO, Mr. David Meyer. Go ahead, David.

Thank you, John. Good morning, everyone. Welcome to our first quarter fiscal 2020 earnings conference call. On today’s call, I will provide a summary of results, then an overview for each of our business segments. Mark will then review financial results for the first quarter of fiscal 2020 and then conclude by reviewing our updated modeling assumptions for our fiscal 2020. If you turn to slide three, you will see an overview of our first quarter financial results. Our first quarter revenue was $278 million, with adjusted pretax income of $600,000 and adjusted earnings per diluted share of $0.02. We generated solid top and bottomline results during the first -- the fiscal first quarter by achieving healthy growth across all segments of our business, despite challenging industry conditions that continue to persist. We are particularly pleased with strong increases in our higher margin parts and service businesses, which grew double digits in the quarter. The solid performance in this area, combined with higher equipment sales drove increased profitability across all our reporting segments versus the prior year period. I will now provide additional detail for our three operating segments, consisting of our domestic agriculture and construction segments, and our international segment. On slide four is an overview of our domestic agricultural segment. Across most of our ag footprint, our former customers are experiencing an abnormally late cold and wet spring. This has caused the delayed planting and this prolonged wet spell has the potential to impact yields, crop selection and in some cases fields will not be planted and growers will opt for the multi-peril crop insurance payment. Farmers’ incomes continue to be negatively impacted by low commodity prices, which is partially attributable to retaliatory Chinese tariffs. In response, last week, the USDA announced the 2019 market facilitation program, which will provide $14.5 billion in direct payments to farmers. According to a recent USDA press release, President Trump directed Secretary Perdue to craft a release strategy to support American agricultural producers, while the administration continues work on free, fair and reciprocal trade deals to open more markets in the long run to help American farmers compete globally. While all the final details of this program are yet to be released, early indications point to a high percentage of the aid going to soybean and wheat producers. We continue to see our growers fleet duty cycle increasing as their current fleet is becoming more aged, along with incurring a higher number of our machine hours. This aged fleet along with the benefits of new technology is creating replacement demand for new equipment purchases. Positive yield trends and carryover from last year’s excellent crop is supporting farmers’ ability to maintain current, productive and reliable equipment fleets. In addition, for the growers who are not updating their fleets, the aged and high yield equipment typically requires more parts and service repair, and our customers will be looking to us for aftermarket support, which is an important part of our business model and integral to our long-term strategy and focus. Turning to slide five, you will see an overview of our domestic construction segment. The strong economy continues to positively impact the construction equipment industry. In addition, the higher oil prices we have been experiencing spurs demand for construction equipment for both oil production and related infrastructure. While we are seeing stronger demand in the metro areas, the rural construction equipment markets continue to be negatively impacted by the depressed farm commodity prices. We continue to target our farmer customers as an outlet for used construction equipment. Our rental utilization is trending positively due to the steady demand and our fleet rationalization efforts. The operational improvements we have been implementing in our construction equipment stores are producing results as evidenced by our year-over-year first quarter improvements to our top and bottomlines in our construction equipment segment. In addition, with our strong first quarter and confidence in our construction equipment business for the balance of the year, we have raised our construction segment revenue modeling assumptions from up 0% to 5%, to up 5% to 10%. On slide six, we have an overview of our international segment, including our markets within the countries of Bulgaria, Germany, Romania, Serbia and Ukraine. Crop development and growing conditions across much of our footprint is good to average. We see overall stability in these regions, continued global investment and with the aged machine population a long runway of parts and service revenue growth as the machinery part increases along with the complexity and sophistication that comes with modern farming in these developing markets. Again, we experienced another quarter of solid performance and bottomline contribution from our international segment. Before I turn the call over to Mark, I want to thank all our employees for their efforts in executing on a solid first quarter. As noted in our release, we paid off the remaining principal balance of our original $150 million senior convertible notes on May 1 in conjunction with the maturity of the security. Again, I want to thank our team for their operational execution that allowed us to retire this debt in the face of some very challenging industry conditions. Our balance sheet remains strong and put us in a good position as acquisition opportunities arise. Now, I’d like to turn the call over to Mark to review our financial results in more detail.

Thanks, David. Turning to slide seven, we achieved total revenue of $278 million for the fiscal 2020 first quarter, an increase of 14.2% compared to last year. Our revenue increase was across all our business segments and across all revenue categories. Equipment revenue was up 15.6%, parts and service was up 10.7% and 14%, respectively. All these of these revenue categories benefited from our AGRAM acquisition, which occurred in July of last year. Excluding this acquisition, our same-store sales were up 11.1%, compared to the first quarter last year that was down about 7%. Our rental and other revenue increased 6.7% in the first quarter due to a higher level of inventory rentals. Our dollar utilization of our designated rental fleet in our construction segment improved to 20.5% for the current quarter, compared to 18.3% in the same period last year. On slide eight, our gross profit of $54 million for the quarter was an increase of 13.2% compared to the same period last year, primarily driven by higher revenues. Gross margin decreased by 10 basis points to 19.4% versus the prior year due to slightly lower equipment margins and a shift in gross profit mix. Our operating expenses increased by $5.9 million to $53 million for the first quarter of fiscal 2020. The increase was impacted by our AGRAM acquisition in the third quarter last year, costs associated with the transition of our ERP application, as well as higher variable expenses such as commissions on the increased revenues. As we previously communicated, we are undergoing an ERP system implementation, which is expected to impact GAAP earnings this fiscal year by approximately $0.25 per share. We view these expenses as non-recurring in nature and for the first quarter these expenses were just over $1 million or $0.04 per share. Despite these increases, we were able to achieve greater operating leverage during the quarter. As a percentage of revenue, operating expenses improved in the first quarter to 18.9%, compared to 19.2% in the same quarter last year. Floorplan and other interest expense decreased 26.5% to $2.5 million in the first quarter of fiscal 2020, compared to $3.4 million in the same quarter last year. This reduction was primarily due to our lower level of interest bearing inventory and a decrease in interest expense on our lower principal balance of senior convertible notes. In the first quarter of fiscal 2020, our adjusted net income was $500,000, compared to an adjusted loss of $1.6 million in the prior year. Our adjusted earnings per diluted share were $0.02, compared to an adjusted loss per diluted share of $0.07 in the first quarter of last year. For the first quarter of fiscal 2020, adjusted EBITDA improved to $6.3 million, compared to $5.3 million in the first quarter of last year. You can find a reconciliation of adjusted net income, adjusted EPS and adjusted EBITDA to their most directly comparable GAAP amounts in the appendix to the slide presentation. On slide nine, you will see an overview of our segment results for the first quarter of fiscal year 2020. Agriculture revenues were $154 million, an increase of 8.3%. We experienced a good start to the year, despite ongoing industry headwinds, with healthy increases in equipment, parts and service revenue compared to an ag segment that was down 12.5% in the first quarter last year. The increased revenue generated the improved adjusted pretax income of $1.9 million, compared to $1.3 million in the prior year period. Turning to our construction segment. Revenue increased 15.9% to $71 million compared to the prior year period. The segments adjusted pretax loss improved by $800,000 to a first quarter loss of $2.1 million. The improvement in segment results was primarily the result of increased revenue. This marks the third consecutive quarter of increased quarter-over-quarter top and bottomline results in this segment as we continue to drive this segment to profitability. In the first quarter of fiscal 2020, our international segment revenue was $54 million, an increase of 32.2% compared to the same quarter last year. The revenue increase was driven by contributions from our AGRAM acquisition, which was completed early in the third quarter of fiscal 2019, as well as revenue increases throughout the rest of our European footprint. Our international segment adjusted pretax income was $200,000, compared to an adjusted pretax loss of $100,000 in the same quarter last year. On slide 10, we provide an overview of our balance sheet highlights at the end of the first quarter of fiscal 2020. We had cash of $63 million as of April 30, 2019. Our equipment inventory at the end of the first quarter was $490 million, an increase of $73 million from January 31, 2019, reflecting a $94 million increase in new equipment, partially offset by a $22 million decrease in used equipment. The equipment inventory turns increased to 1.8 in the current year, compared to 1.7 in the prior year. I will provide a little more color on our inventory on the next slide. Our rental fleet assets at the end of the first quarter increased to $114 million, compared to $111 million at the end of fiscal 2019. We continue to anticipate that our fleet size will be around the $110 million level by the end of fiscal 2020. As of April 30, 2019, we had $374 million of outstanding floorplan payables on $640 million of total floorplan lines of credit. We continue to have ample capacity in our credit lines to handle our equipment financing needs. Our total liabilities to tangible net worth ratio was a healthy 2.1. This ratio was impacted by the current quarter adoption of the new lease accounting standard, which require the recording of lease liabilities have an approximate impact of 0.4 on this metric. The ratio of 2.1 is well below the ratio of 3.5, which is the leverage covenant required of our larger bank facilities. At the end of the first quarter, we had $46 million of outstanding senior convertible notes. On May 1, 2019, the maturity date of this security, we repaid the outstanding principal balance using cash on hand and our existing lines of credit. Significant cash generation over the past few years allowed us to repay these notes in full without having to replace them with another long-term debt facility. With the retirement of this debt behind us and our expectation of another good year of generating cash from operations, we are in a solid liquidity position during a period of volatility and uncertainty, particularly within our ag segment. Turning to slide 11, I would like to provide additional information on our equipment inventory. As I just mentioned a few minutes ago, in the current quarter we experienced seasonal stocking of new equipment inventory and saw a nice reduction in used inventory levels. These changes are reflected in the size of the red and blue bars in the current quarter on this slide. We are maximizing our non-interest bearing terms from our manufacturers. The dollar amount of non-interest bearing inventory is reflected in the grey bars next to the inventory levels. As an example, in the current quarter, we had total equipment inventory of $490 million, of which $232 million or 47.4% was non-interest bearing. Since fiscal 2017, the chart clearly demonstrates increasing levels of non-interest bearing inventory on relatively flat total equipment inventory levels. The primary driver of this improvement is the reduced aging of our inventory as a result of our ongoing life cycle management efforts, as more of our inventory remains under interest free terms with our manufacturers. This improvement has been the primary reason for the reduction in floorplan interest expense over the past few years. We expect that equipment inventories will increase in the second quarter of fiscal 2020 and then reduce in the back half of the year. Non-interest bearing inventory levels will follow that seasonal trending as well. Slide 12 provides an overview of our cash flows from operating activities for the first three months of fiscal 2020. The GAAP reported cash flow provided by operating activities for the period was $3 million. As part of our adjusted cash flow used for operating activities, we include all equipment inventory financing, including non-manufacturer floorplan activity, our adjustments for non-manufacturer floorplan payables was $13 million for the first three months of fiscal 2020. We also adjust our cash flow to reflect the constant equity in our equipment inventory, which enables us to evaluate operating cash flows, exclusive of changes in our equipment inventory financing decisions. The equity and our equipment inventory decreased 10.8 points to 23.6% during the three months period ended April 30, 2019 and the adjustment for constant equity in equipment inventory represents a $53 million use of cash. The decrease in equipment -- or the decrease in equity in our inventory is primarily due to the seasonal stocking of new equipment inventories in the current quarter and the higher level of floorplan financing available on such inventories, as well as borrowing more on our floorplan lines in preparation for the repayment of the outstanding balance of our convertible notes, which occurred on May 1, 2019. After all the adjustments, our adjusted cash flow used for operating activities was $37 million for the three months period ended April 30, 2019, compared to $26 million for the same period last year. Slide 13 shows our updated fiscal 2020 annual modeling assumptions. We are increasing our revenue modeling assumptions for construction to reflect the relative strength we had -- we experienced during the first quarter and our expectations for the balance of fiscal 2020. Our updated construction segment assumption is a growth of 5% to 10% versus flat to up 5% previously. We are maintaining the assumptions for agriculture at flat and international add up 10% to 15%. Recall that our range for international includes the revenue contribution from the AGRAM acquisition, which closed in July 2018. Despite the solid first quarter performance, we remain cautious due to the uncertainty in the ag industry. Therefore, we are maintaining our expectation for adjusted diluted earnings per share in the range of $0.75 to $0.95 for fiscal 2020. Operator, we are now ready for the question-and-answer session of our call.

Thank you. [Operator Instructions] Our first question comes from the line of Steve Dyer with Craig-Hallum. Please proceed with your question.

Thank you. Good morning. A question on ag in the quarter, obviously, a really strong resilient quarter, given a pretty tough backdrop for your footprint. What do you sort of attribute that to, is that just upgrade cycle or maybe a little bit more color as to what drove that strength?

Steve, good morning. This is Dave. I think there -- if you look at last year, I think, there was some carryover there, we had actually use pretty much across our whole footprint and some of that typically carries over into the following year. Definitely a replacement demand is real out there in the age and the hours on the equipment started increasing. And another -- at the end of the year last year, the soybean growers from this 2018 markets facilitation program pickup another $1.65 for our report of the soybeans they had. If you look at the last year -- this time of year last year, a lot of the growers they were able to contract soybeans up over that $10 level. I think there were some pretty good corn contracts at times. So with that good year last year, with some pretty good contracting, the $1.65 market facilitation shot in the arm, put while our growers and some pretty good position here to really take care of their equipment needs as they go into this year’s planting season. So that’s what we attribute that to.

Great. Got it. Helpful. And then, corn, which you guys have always been fairly correlated to despite nicely north of $4 a bushel here in the last few weeks, I guess, one, do you have any view on the sustainability of that? And then, two, is that something that can change sentiment in your view, and if so, sort of that need to stay that way before farmers start sort of viewing things differently? Thank you.

Yeah. Over the last couple of days, yeah, definitely, that put a little more bounce on some of the farmers steps seeing this movement on the corn price and I would say a lot of that’s attributed to the potential for a lot less acres going. Fortunately in most of our footprint with the exception of South Dakota, our farmers are making progress and I think with this week, most of our corn will be in the ground. But if you look at Indiana, you look at Ohio, you look at Illinois, they are way behind in their corn planting and continues to be very, very wet. So there could be on a supply side shot in the arm we are less supply yield to really that corn might go up. So, I know some of our growers are locking in some at today’s price and they just going to keep selling more as if they keep growing up obviously. I’d say that’s definitely has the potential for a real positive and it could be a real nice thing depending on how much corn gets planted, really what happens to the yield as we get later in the year like that typically that yield potential starts diminishing too. So, if you take less acres and less yield across the U.S., there are people are already speculating here what that supply side could do for a potential corn price.

Got it. Thank you

Thank you. Our next question comes from the line of Mig Dobre with Robert W. Baird. Please proceed with your question.

Thank you. Good morning, guys. I -- maybe want to start at construction. Obviously, you are raising the guidance there and you had a really nice strong start to the year. So I am looking for a little more color in terms of what’s driving all of this and especially what’s different versus your initial expectations that you had embedded in your outlook?

Yeah. I think with construction now, I think, as we mentioned in our prepared remarks it’s three quarters now -- three consecutive quarters of that improved top and bottomline results and it’s really, call it, blocking and tackling, and just focus on all the fundamentals out there. One of the areas of improvement is the inventory improvement that we have had there. That’s driving better margins and lower floorplan interest expense in that area. Particularly within this quarter you saw some of this parts and service. Our focus in that expert team on driving that parts and service business really came through in the first quarter. Some of that may had to and maybe to -- and without late start to the construction season, and our customers really wanted to make sure out there continue to ready to go out there on the construction side as they get at compressed season here to get their jobs done. I think the last thing is on the rental. We talked about the rental utilization being up 2 percentage points. Again, I think, some of that re-fleet rationalization that we have done, done some benefits here as well as just better execution on that side of the business and getting those rental deals in place. So I don’t know that it’s any one particular things, it’s a combination I think of a lot of things that will continue -- expecting to continue to happen and get us to profitability in this segment this year.

To be clear, I am mostly wondering what’s going on with the topline, right? I mean you are going from 0% to 5%, to 5% to 10%. And I mean, correct me if I am wrong, the parts and service and rentals are not enough to generate this change in guidance, seems like equipment demand has to be part of it.

Yes.

Yeah. Yeah. And I think some of the same things it’s happening on the equipment side. Just going out and getting that business. I think Dave indicated in some of his remarks, just with the strength of oil, some of the sustained strength in oil that’s happening particularly up here in the Bakken we are seeing some better activity. But that’s flowing through to some of the other areas in the strength in our metro markets and it is -- it came through better than what we anticipated, particularly late in the quarter here in April where we saw some good positive results there on the equipment sales side.

I see. Okay. And then maybe we can talk a little bit about your guidance in ag, you are still calling for flat that implies in the subsequent quarters, call it, slight decline. But I am wondering how you are thinking the second quarter versus the second half, what is sort of the progression here because your comparisons, obviously, are varied. So how do you think about it from a modeling perspective?

Yeah. I think, from -- as far as sequentially in the quarters here, I think, Q2 will see -- still see some positive, I think, Q2, Q3, and then once you get out to Q4 where we had a very strong Q4 this last year, you will see some of that come off a little bit. So I’d say some level of growth in Q2, Q3 and then going negative to a small degree in Q4, which is our highest equipment revenue quarter.

Okay. And then, obviously, you are not guiding any more to equipment margins and I understand that. But when I am looking at Q1 you came pretty close to what you have described as the new normal up 11%. Is there any variability that you would call out for the rest of the year directionally for us?

I think, overall, yes, we kind of alluded to last year getting to that that normal, we have came a little bit short in the first quarter here. But I don’t see, I mean, I -- there’s always some risk in all of this, but I think 11% for the year is certainly still attainable, even though we started out a little bit low here in the first quarter. So, no, I think, in -- I think, Q2, Q3, tends to be a little bit stronger as well and then when we get out to Q4 it will come off a little bit. I think we will be higher than we were last year in Q4, but -- Q4 will be a little bit lower than the other quarters of the year.

That’s helpful. And then maybe last question for me, I remember having this discussion on parts and service last quarter, because things were already looking like we are going to have a -- maybe a challenging plant season and that proves to be the case. Your performance was really, really good here. So it looks to me like it surprise you positively, correct me if I am wrong, I mean, I am wondering sort of what was different than what you were initially contemplating? And then as you look at the rest of the year with comparisons getting tougher in both parts and service, how do you think about growth going forward?

Yeah. I think, it did surprise us a little bit. It was higher than what we had expected. We did expect some nice growth last year in the first quarter it was off a decent amount versus the prior year.

The comp [ph].

I think another thing -- yes. Yeah, the comp will be tougher like you said later in the year. And the other reason why it’s going to be tougher is because of the AGRAM acquisition. So we are benefiting from the AGRAM acquisition to the tune of, probably, 2 percentage points to 3 percentage points here in the first quarter, second quarter it will be similar to that and then that goes away. I think it’s similar to what I said maybe on construction, we saw more strength in April, late in the quarter in parts and service where it really came on. And again, some of that may have been just due to our customers wanted to make sure that they are prepared for getting out into the field in this case to minimize the breakdowns that occur and I think that’s partially to do with that. I think the other thing we are learning is, this parts and service tends to be somewhat lumpy and it’s hard to predict between quarter-to-quarter. As you mentioned, last quarter we were a little disappointed particularly in the service results last quarter and that did come back strong. So it tends to be a little bit lumpy at times. But as far as to the full year, we still expect, I think, what we mentioned before kind of that that mid single-digit growth for the full year. The biggest quarter is, Q2 is going to be bigger but Q3 is the largest quarter, of course, with the harvest. So that all kind of make it or break it, I think, as far as attaining that mid-single digits in our parts and service growth for the year.

Right. So, Mark, to be clear, when you are saying Q3, the largest you are talking about dollars in revenue not growth, correct?

That’s correct. Yes.

Okay. Good job, guys, and thanks for the color.

Thanks, Mig.

Thank you. Our next question comes from the line of Rick Nelson with Stephens, Inc. Please proceed with your question.

Thanks. Good morning.

Hi, Rick.

I’d like to drill down into the equipment margins, we did see some pressure this quarter, is that on the new side or the used side and if you could comment on inventory in the channel, are other dealers taking advantage of these interest free deals and where you see channel inventory?

I think, so I will take it at least the first part here, as far as the equipment margins go, most of that pressure we saw coming from the ag side on the new, used continues to be stable, and I think, due to those industry supplies, and specifically, our improved inventory condition that we had. But I think that the pressures -- there is pricing pressure on that new from competition and difficulty fully passing on some of those OEM price increases to the customer, especially in this difficult environment. As far as other others taking…

Yeah. I can talk to inventory, Rick, a little bit, so we are comfortable with our current level of inventory right now. What we need we have right plus additional units in Q3 and Q4 to hit our full year revenue number, so we have got the ability to flex up and down with the Q4 orders, but we have to get a little more visibility into the both -- commodity prices and what’s going on with the yields and then, I can say, we have got that opportunity to flex up and down. So we talked a little bit earlier about corn, but if that stays on that same price trajectory during -- due to less acres on -- and our order slots in that fourth quarter they could be starting to get -- they could fill up pretty fast. We always -- we have to be kind of cognizant of that. Then like -- what like Mark explained too in his -- during our presentation that higher percentage of inventory on that non-interest bearing that really helps, that’s helpful too. So the whole picture, we feel pretty good, it’s pretty well thought out plan, and I’d say, we are right on track right now.

Great. So ag segment, the revenues were up 8%, you are guiding to flat, we heard some of the cautionary comments that you made that could cause a slow down. What are the sign posts, you mentioned corn prices that we should be looking for to shift your expectations?

Well, I think, as you look ahead, so -- but, again, if we just go back to last year a little bit, excellent yields and in some cases record yields across our footprint. Our growers had the ability to contract this time of year last year at a much higher numbers than what you are seeing today. We had a $1.65 soybean market facilitation program. So that drove a lot of last year’s business. Now this year we don’t know about -- we don’t know what the yields are going to be. We are not sure what the price is going to be. We still haven’t seen the details of the market facilitation program. So definitely there is a level of uncertainty and volatility out there. So we need some type of resolution to all of this trade information that’s out there. But, so this year a lot of that first quarter, I’d say, is carryover from last year, and then, I guess, that’s still yet to be seen for the balance of the year and so I’d say stay tuned.

Got it. Got it. That make sense. How about capital allocation, your thoughts today, you have got that converts now off the books, you are sitting on $63 million in cash. Do you continue to build the cash or do you think you would be putting it to work, any update there?

Yeah. I think, certainly, getting that convert behind us is big and critical. I think, as we have talked, I think, there’s a lot of opportunity. We believe there’s a lot of opportunity particularly on the ag -- domestic ag side and the length of this being in the trough of this cycle that we have been in. There is good opportunities to go out and get some good quality acquisitions done on the ag side and we are focused on that and that’s, I think, that’s the top of our list from a priority standpoint in regards to capital allocation.

Great. Thanks and good luck.

Thank you.

Thanks, Rick.

Thank you. [Operator Instructions] Our next question comes from the line of Larry De Maria with William Blair. Please proceed with your question.

Hi. Good morning, everybody. I know that maybe this is difficult, there’s a lot of moving parts, but we have prevent plant dates coming up and you have the new program from the government that is worth mentioned. So how are you thinking about overall, let’s say, farmer income in your territory this year, because assume there is going to be maybe some less acres and more prevent plant. So can you kind of piece it all together and think about how you are thinking about farmer income with, obviously, probably, less yields, et cetera, but higher prices. So just overarching trying to understand if this is potentially a real pivot for your market or at the end of the day, we are still going to talking about trades in the another markets and it’s just sorted out? Thanks.

Okay. So I think we are pretty fortunate, Larry. Let’s say, if you look at Minnesota, North Dakota, Nebraska and Iowa, they are actually not too far off from a year ago on their -- getting their corn planted, and like, I say, this week it’s 80 degree and in some cases maybe the weather is sunshine, and I’d say, we are going to get all that corn planted this week and some of the corn is up already. So I think South Dakota is the only thing state we have that’s probably a little bit on the left side. So I am fairly confident that our growers are pretty resilient and pretty resourceful. I’d say, you are going to see that corn get down and then soybeans are going to follow up right after that. So we are fortunate from that standpoint. Definitely, we have got the market facilitation program, we got the trade issues going on and all, and we need to get some closure to that so -- to get some of this uncertainty out of the marketplace like that. So I think everybody is pushing for that. I’d say, this 2019 market facilitation program, that’s a positive and that’s going to help our growers and I think it’s going to be especially helpful for soybean growers, we are -- and if you look at our five states, our five ag states, we raise a lot of soybeans. So that’s going to be good for that. I think one thing that, as we start to see this corn price start improving a little bit. I am not sure if everybody is aware of the amount of corn on hand, on the farms, in the storage, there is in some cases one year’s worth of crops two, even we have got some of our growers out with three years worth of crops on hand. So any spike in that corn price, I think, is going to be a benefit not only to this year’s crop but that grain on storage is going to get -- be able to get sold in that standpoint, again for some of these guys it could even be a little bit of a tax problem. So I’d say, I think some of our growers are challenged right now, the banks are become have a real conservative pulling to them. I think that some of our growers out there are putting their crop in this year without an operating note. So that’s going to be a little bit challenging for some of them. But I think when you get all said and done, I like our five states. I think we are going to be in pretty good shape as we get through this, and like we say, we just need to get that the trade issues, the tariff issues resolved and get this crop through and get it in the bin. So, hopefully, that gives you a pretty good summary.

Okay. No. It does. It sounds like you guys are in better position than a lot of others. And I guess, you guys kept the ag outlook, and obviously, you raised construction, but maintained the EPS guide a fairly wide range. I am just curious about the puts and takes to that and why not narrow it given the slightly better construction? And secondly, correct me if I am wrong, it sounds like if there is upside to ag, mostly going to come later in the year once we drove this and then maybe orders getting better later as opposed to near-term, is that right?

Yeah. I think, so first of all, in regards to ag, just with all the different uncertainties out there that Dave mentioned with the commodity prices, trade war, weather, you mentioned prevent plant, all of these things are just a lot of uncertainty out there. And on the CE side, with the revenue increase there, that’s obviously going to be the positive, a little bit of the offset here as we did run a little bit higher in expenses than what we had anticipated, so that will come off a little bit. And I think just keeping in mind that it’s a range there on that EPS and we are early in the year with a relatively seasonally low first quarter here. So there’s a lot of the year left to achieve that full year EPS range.

Okay. And then last question -- thank you. You have talked about obviously potentially putting some money to work in the M&A, are there ample opportunities in your territory in the Midwest, are you looking overseas, just curious how things are shaking out now, and obviously, that kind of an odd backdrop as well. So what kind of opportunities are there right now, are they there?

No. I think the opportunities are, we like this Upper Midwest footprint we are in, and I think, we definitely there is ample opportunities, still fairly fragmented number of dealerships, your aged dealer principles, I think, there some capital challenges. So, yeah, I think, we definitely have some good opportunities either contiguous or in this same footprint that we are in today.

Okay. Thanks and good luck guys.

Okay. Thanks, Larry.

Thank you. Ladies and gentlemen, that concludes our question-and-answer session. I will turn the floor back to Mr. Meyer for any final comments.

Okay. Thank you everyone for being on this call today and look forward to updating you on our progress on our next call and have a good day.

Thank you. This concludes today’s teleconference. You may disconnect your lines at this time. Thank you for your participation.