Question-and-Answer Session
Operator
(Operator Instructions) Your first question comes from James Lucas – Janney Montgomery Scott.
James Lucas – Janney Montgomery Scott
First question, the costs taken out, the cash flow is a very good number, your controlling the controllables if you will and now with no major debt coming due for a little while now can you speak to priorities of capital allocation?
Randall J. Hogan, III
Jim, it really is the two Ds, it’s dividends and debt. I’m pleased with the cash flow that we’re generating and I’m pleased with the progress on costs and you said it aptly, we got control of the controllables but I still think there are too many uncertainties in the external markets to commit to anything bolder than that.
James Lucas – Janney Montgomery Scott
So in terms of weighing share repurchases versus acquisitions it sounds like that’s on the back burner?
John L. Stauch
It is Jim and we want to continue to control our own destiny and we think right now the best way to do that is to keep the debt at manageable levels and continue to pay it down. When we get to a comfortable level either with more predictability around EBITDA and our ability to lower that debt position then, I think we’ll look opportunistically at the ideas that you’re suggesting. But, right now it’s focus on debt reduction and keeping destiny within our control.
James Lucas – Janney Montgomery Scott
Then switching gears, on the filtration side of the business could you perhaps give us a little bit more color on both Porous and Everpure and what you’re seeing in their end markets right now?
Randall J. Hogan, III
I’ll go with the food service first, no surprise that there’s a challenge in the food service industry in terms of new placement but, I think Everpure is doing well in viral and our partnerships with Ecolab and some of the other leaders. I think our position with winners in this environment, people like McDonalds is boding well. So, we’re down slightly but I think we’re actually gaining share. We’re also looking to extend that capability more deeply in to the hospitality area, also an area that’s challenged right now. But, given the focus on sustainable water solutions, higher energy efficiency and lower water usage, we’re having some very encouraging discussions with a number of the larger hotel chains.
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