Question-and-Answer Session
Operator
(Operator Instructions) Your first question comes from Charles Strauzer – CJS Securities.
Charles Strauzer – CJS Securities
Just picking up on your last comments there, obviously there’s been a lot of compression or pressure on some of your smaller competitors and given the ability to maybe define some attractive targets right now I would assume that you’re figuring that the multiples have come down quite a bit in terms of price when you’re having these discussions, is that true?
Robert G. Burton, Sr.
It is. It’s like everything else you need to walk them down from what they expect to what’s reality. But, price is a big thing but just as important Charlie as I’m sure that you know better than anyone, it’s also where the synergies are. If there are really significant synergies we have the advantage of doing price versus the other thing but in some cases we won’t beat people up as much or at least try to work a deal where we look consolidated at both synergies and what the price is. But, the answer is yes, the multiples have come down because I look at ours and I look at the rest of the industry and the multiples are a lot less than what they should be.
Charles Strauzer – CJS Securities
I would assume that you say they’re accretive to earnings they would also probably be accretive to your leverage ratios if you were going to make a transaction of these types of size?
Robert G. Burton, Sr.
That’s is correct. I didn’t mention that but, that is correct.
Charles Strauzer – CJS Securities
Then just talk a little bit more about some of the pressures in the industry. Obviously, there’s been a lot of news about various kind of mid size printers starting to feel the pain. Are you starting to see that acceleration? I agree with you, I do think the industry is going to see an acceleration on the compression side of the capacity that is out there and I think it needs to happen. I think obviously when you look back to ’01 post 9-11 a lot of your competitors were kept afloat through vendor financing and creative access to capital but you don’t have that access to capital today so are you going to see that acceleration pretty soon?
Robert G. Burton, Sr.
You know, really it’s sad. It’s very sad to see companies that have been around for 25 or 50 years that really will not make it in today’s environment and they are falling like flies unfortunately. You talk about that and there were some companies early on that were totally funded by people buying presses for them and putting them out there in business. Those days are gone. They are gone.
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