Question-and-Answer Session
Operator
(Operator Instructions) Your first question comes from the line of Curt Woodworth from JP Morgan.
Stephen M. Carter
Good morning, Curt.
Warren Chiang – JP Morgan
Hi. Good morning. This is Warren Chiang on line for Curt.
David S. Aldridge
Hi, Warren.
Warren Chiang – JP Morgan
Hi. I was wondering, the margin improvement that you saw this quarter, could you give some color on the breakdown between how much of that was base business versus acquisition integration?
Stephen M. Carter
Well, certainly there was a – to some extent, the acquisitions brought in some higher margin product sales that influence the results. But I would say that equally, perhaps even more so, the product mix shift that we are seeing in our communications business, and indeed in our existing magnet wire business, towards some of the higher margins sectors has probably influenced the margin percentage more.
Warren Chiang – JP Morgan
Okay. And looking forward, how much more room to run UST from each with the base business and additional business accretion.
Stephen M. Carter
Well, we continue to believe – I said in the script that we have got two major projects underway in terms of looking at our factory network, assuming that both come to fruition successfully, we do expect it to be up to produce more efficiently. And every time that happens, it is helpful to the margin. The other thing that we continue to work on very hard is assessing which are the product segments where we want to make investments.
And I think in communications, we have said before, that we are seeing a steady transition there from the old OSP products into the, for us at least, the newer data cable segment and the higher product areas within that segment.
Warren Chiang – JP Morgan
Okay. I was also wondering, how do you see pricing for magnet wire holding up in the current environment for the next few months?
Stephen M. Carter
Well, I think it will be very similar to the last few months, which that is there are some segments which are in high demand where capacity is struggling to keep up with that demand. And as a result, as you would expect, pricing is very tight. And then you have got some segments where the demand is weaker, factories have got spare capacity. And thus you are seeing a weaker negotiating position for pricing.
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