Thanks very much. Good afternoon everyone and welcome to our first quarter conference call.

Joining me this afternoon are members of my executive team Jim Gerald, Roger Fulton, Marc Stoddard and some members of our corporate marketing finance and legal teams. Chris Merchant, our Global V.P.

of Finance will fill in for our CFO Dale Schneider on the call this quarter as Gail is unfortunately not able to be here today. Before I begin, I will draw your attention to the disclaimer currently being broadcast.

So let's start off with sales, earnings and contents as per normal. Sales for the quarter were $1.97 billion up 4.3% from last year despite some soft markets out there, which is great to see.

Operating earnings were $197.7 million normalized for balance sheet exchange impacts and any unusual items, which was up 5.6% over last year. Taxes, Interest and Depreciation were clearly a big part of that, meaning normalized EBITDA was actually fairly flat to last year.

A few factors were key in driving our performance this quarter, first MacDon continues to perform despite some market pressure, with market share growth offsetting flat markets globally on key combined products. And secondly, launches in the transportation business are running strong, and doing a great job of driving top line growth for us in some challenging markets.

A few factors were a challenge this quarter, and hurt our results. First, Light Vehicle markets for the three regions we serve were down 5.1% with weakness seen in every region globally.

We saw continued significant declines in the light vehicle market in Europe. Thanks to both deteriorating demand for diesel vehicles and the WLTP situation.

In addition, vehicle volumes were significantly down in China, affecting several key customers. Finally, volumes were down in North America as well, but particularly so with the [Indiscernible] quarter-on-quarter customers of ours.

Secondly, launch costs and transition impact were a key factor in the quarter as well. First of all, the transition to next generation platforms is weighing on margins as both launching and declining platforms are currently running at sub optimal levels.

Secondly, cost of launches globally are at high given the high level of programs that are currently launching. We do expect these effects to moderate over the next couple of quarters.

Also impacting the quarter were higher commodity costs in our Industrial segment and higher interest and tax costs than last year as mentioned? Normalized net earnings as a percent of sales in the quarter were 7.1% down from last year due to these factors.

On the positive side, our industrial segment continues to perform extremely well, with normalized operating earnings up 24% over last year and normalized margins at 16.7% also up over last year’s 15.8%. The Transportation segment saw earnings and margins decline due to launch and transition impact as described.

We do expect another quarter or two of this impact before we start to see some relief. In North America, content per vehicle for the quarter reached $167.37 up 1.2% from last year, thanks to launching business in a market that was down 0.2%.

Q1 automotive sales in North America as a result were up 0.9% over last year at $752.9 million. In Europe, content per vehicle for the quarter was $84.62, up 10.3% over last year, thanks to launching business in the region and the market that was down 5.3%.

Growth in Europe for us has really been fantastic. It's only 5 years ago that content in Europe was only about $20.

Q1 automotive sales in Europe as a result of our content increase were up 4.5% over last year at $472.4 million. In Asia Pacific, content per vehicle for the quarter was $10.29, down 0.6% from last year, largely due to China production declining much more steeply from overall Asian production.

When combined with market declines of 6.6%, we saw Q1 2019 automotive sales in Asia Pacific down 11.7% versus last year to reach $128.2 million Asia will be a significant growth area for us over the next several years, with more than 50% growth over current sales levels booked already. Much of the growth is coming from electrified vehicle program launches as might be expected given the stronger focus for new energy vehicles in China.

In fact, nearly 25% of our Asia Group sales will be for electrified vehicles by 2023. It's great to see continued content per vehicle growth in the quarter in most recent regions, reflecting our increasing market share thanks to large amounts of launching business.

Market share growth is key to celebrating growth when volumes start to pick up. Other automotive sales not captured in these content calculations were $69.8 million up somewhat over last year due mainly to increased truly sales.

Commercial and industrial sales were up 13.4% in the quarter at $559.2 million compared to $493.2 million last year, thanks to a full quarter at MacDon this year. If you recall last year, it was just two of the three months, and global market share growth for a combined headers that MacDon experienced despite a flat market.

Investing in our future continues to be a priority for us at Linamar. CapEx in the quarter was $120.4 million or 6.1% of sales down over the last couple of quarters as expected.

We still expect 2019 to see lower CapEx in 2018 and end up at the low end of our normal 6% to 8% range. 2020 will see a similar picture of spending at the low end of our normal range.

Our net debt level came up a little largely due to changes in IFRS Accounting. Ignoring such, we would have seen free cash flow of more than $20 million in the quarter and get down $10 million over Q4 and $156 million down over last year.

Net debt to pro forma EBITDA of $1.78 and still expected to be back down to about one times EBITDA by the end of the year. We expect to be under one times next year based on continued, strong and positive cash flow.

We're going to drive that leverage down thanks to the excellent free cash flow that we are expecting this year. We will generate between $500 million and $700 million of free cash flow this year thanks to higher earnings, lower CapEx, and a focus non-cash working capital improvement program.

We've already seen an improvement in non-cash working capital as a percent of sales compared to the last quarter, and expect to see continued improvement to such particularly in the back half of the year. Turning to our market outlook, we are seeing stability or moderate growth this year in most of our markets, with a somewhat similar picture next year that reflects slightly softer markets in a few areas.

Industry experts are predicting on highway medium heavy truck volumes to be up this year in North America and Europe at 5.9% and 6.4% respectively but to decline in Asia. Next year declines are expected in both North America and Asia, but moderate growth expected now in Europe.

Off-highway medium duty and heavy-duty volumes are also continuing to show signs of improvement. Turning to the access market, the industry is expecting mid-single digit growth in the global aerial work platform market this year.

Performance is being driven by growth in all global markets and each product group. Next year is expected to see market contraction in the mid-single digit, primarily driving out of North America.

We continue to see positive industry metrics with significant infrastructure spending in every region and an ARA forecast of 4% to 5% rental revenue growth for the rental business this year. Skyjack backlog is strong.

It’s our goal to continue to outperform the market, stream market share growth this year and next. Turning to the agricultural market, the industry expectation is for a flat to declining, combined market this year in North America, thanks to tariffs hurting North American farmers and therefore dampening demand.

This is particularly true for soybeans and canola products and particularly in Canada. Europe, CIS and Australia are also expected to decline driving the overall global market down in the mid-single digit range, despite Q1 being reasonably flat.

It's our goal to outperform the market, through global market share growth at MacDon as well. For the global light vehicle business.

The forecast is for flat to slightly down light vehicle volumes at globally again this year, to 16.8 million, 21.6 million and 49.7 million units globally or in rather North America Europe and Asia respectively. Next year, we'll see similar flat volumes of plus or minus 1% to 2% depending on the region.

As mentioned, we expect to see pressure in the first half of the year in most regions, shifting to some year over year growth in the back half according to these latest IHS estimates that you can see depicted here on the slide. This is going to result in a second consecutive year of global light vehicle volume declines with forecasts for growth to resume in 2020 in most regions at this point.

I think that it is important to reflect on past cycles of auto production and how they linked to Linamar’s earnings per share growth. In the first decade of this century, we saw U.S.

Light Vehicle sales 3.3% as depicted on this chart. In that same time period, Linamar grew EPS 10.9%.

In the next 10 years when U.S. sales grew at a compounded rate of 5.7%, Linamar grew our EPS 97%.

The bottom line is Linamar has a strong track record of out performance and long term growth regardless of auto cycles being up or being down. Turning to an update on growth and outlook.

We continue to see good levels of new business wins and a strong book of business being quoted in our transportation business. Q1 was another good quarter for us in terms of new business for the transportation business, with quite a few notable strategic wins driven by continued acceleration of powertrain outsourcing which is very exciting.

Our addressable market across a range of vehicle propulsion types continued to look excellent as you can see on this chart. Global vehicle growth is forecast to grow at a compound rate of 1.5% to 2% over the next 25 years.

Each type of vehicle propulsion offers excellent and growing potential for us and our suite of products for each continue to be developed and to grow. The total addressable market for us today is more than $125 billion as you can see and growing to nearly $325 billion in the future.

We have 204 programs in launch at Linamar today. Look for ramping volumes on launching transmission, engine and driving platforms to reach 40% to 50% of mature levels this year.

These programs will peak at more than $4.3 billion in sales. We saw a shift of about $110 million of programs that moved from launch to production last quarter, including the $30 million in incremental sales from those programs hitting this year we will see a total in launches this year in the $800 million and $900 million range.

Next year, we will see growth in these programs of 60% to 70% which means incremental sales from launches of more than $1.2 billion in 2020. In addition, as noted Skyjack is targeting growth above market this year.

So expect high, single digit to low double digit growth for Skyjobs for 2019 and relatively flat performance in 2020 as they offset market contraction with market share growth. MacDon will face market pressure as noted for the balance of the year.

Market share will help offset market declines, but the extra month sales which benefited Q1 will of course not repeat. This should all sound -- fail to result in a flat to somewhat increased sales for the year compared to 2018.

Next year we are targeting single digit growth, but of course this will be market sensitive. On a positive note, coordinate sales for North America have tripled since MacDon took over sales and distribution of the autos product, which is great to see, a testament to the fantastic brand name and reputation MacDon has developed here in North America.

Temper that growth with the loss of business that naturally ends each year, noting to expect such at a high end of our normal range of 5% to 10% this year and next year as well ofcourse as normal productivity giveback. To summarize expectations for the top line for this year, our strong backlog of launching business and growth in our industrial sectors will offset market softness in the transportation segment and drive mid-single digit top line growth rates this year.

Next year, we'll see growth pick up thanks to strong launches and more stable markets. On the margin side, we expect to see fairly flat margin performance in both segments this year.

This means staying at the mid-to-high end of our normal OE margin range of 14% to 18% for the industrial segment and 7% to 10% for the transportation segment just as we saw in 2018 excellent results really given market pressures. Next year, we will see margin expansion in both segments as we get to the other side of the transition to next generation platforms and markets settle out and MacDon resumes growth.

The sales growth noted coupled with flat margins will result in mid-single digit normalized operating earnings growth this year as well, an excellent expectation driving from organic only growth in soft markets. Next year, we expect double digit normalized operating earnings growth thanks to margin expansion, in both segments and stronger growth.

I'd like to highlight a couple of our more interesting wins this quarter. First, we won a fully machine block program for on-highway trucks for one of our U.S.

facilities. Production will start in 2022 for this program.

Also on the commercial truck side, we picked up several components for an on-highway truck program in India, including a block at the head. It's great to see the commercial vehicle market starting to yield some opportunities and also to fill in additional work for our facility in India.

It's that new business wins on the commercial vehicle side represented a sizable portion of new business wins for the quarter. On the casting side, we were awarded a major expansion program for cylinder head castings for one of our European foundries.

Production will start next year. We continue to see excellent opportunities for our foundry business, with nearly 70 million in new business wins this quarter for this division one this quarter alone.

Finally and possibly most excitingly, we were awarded a development program for a confirmable hydrogen fuel tank, for a fuel cell vehicle under development by a key light vehicle customer. We feel this project is strategically very important, as we believe we will see a move towards more fuel cell electric vehicles in the light vehicle space over the next decade and the fuel tank is a very high value technologically sophisticated product in a fuel cell vehicle.

The tank design derives from IP that we acquired last year for our unique design and tank that has significant design advantages over traditional hydrogen tank design. It's [Indiscernible] and offers much more flexibility in terms of vehicle design, which is of great interest to our customers.

Turning to an innovation update, we continue to invest in innovation, in each of our key businesses. I wanted to highlight a project in our transportation business this quarter for innovative, lightweight structural components.

This project involves a Cross Car Beam, which is a structural component that's found within the instrument panel of the vehicle. We jointly design this product with our customer, which will be produced in ultra lightweight magnesium.

We developed a unique process to cast the part which is much more efficient and cost effective and alternative tasking methods. We're utilizing a newly installed 4,400 time high pressure die cast press to do the job, the largest tonnage machine by the way installed in North America.

We're really proud of the team for the work that they've done on this program. Structural parts, caster lightweight materials have huge potential in the market as they replace heavy and costly stamped steel assembly.

Light weighting the body is particularly important in electric vehicles, where heavy battery packs are adding as much as 800 kilo to the vehicle weight and impacting the efficiency of vehicle performance. Lightweight structural parts will as a result likely have a higher market potential in electric vehicles than traditional internal combustion vehicles although of course light weighting is welcome in these vehicles as well.

We also continue to make considerable progress on our broad digitization initiatives. That's summarized on this slide.

We're rapidly transforming our shop floor to be more efficient, more proactive and reactive, safer and more connected, and in the progress, creating more exciting career opportunities for our employees. There's a huge amount of opportunity in these technologies to dramatically improve efficiencies of our operations, both on the shop floor, and in the back office as well, which we can deploy on a global basis.

In other areas of operations, our plants continue to perform well, both on mature business metrics and in terms of launch. Our launch systems are excellent, and our plant controls are world class.

In terms of new plants, we're making great progress on our three key expansion projects that are underway at the moment. Our new state of the art facility in Hungary has a significant E-Axle Gearbox program is nearing completion.

We'll be moving equipment into the facility in the summer, they continue launch preparation. The project starts into production late next year.

Secondly, the expansion of our fabrication facility also in Hungary to accommodate growing Corn Head sales and also to house the European requirements of Skyjak is also nearing completion as you can see here. And finally, the expansion of another facility in China is also well underway.

This facility will also take on a major E-Axle program, which launches next year as well. Finally, a trade update, unfortunately not a lot to report here.

Discussions continue to ratify USMCA in all three countries here in North America. It is as yet unclear if this will happen this year or not.

Frankly, I'm less concerned about that, I’m much more concerned about the need to eliminate the tariffs, which are continuing to take their toll on our American customers. They are seeing billions of dollars shift from investment in important new technologies transforming the auto industry to funding the U.S.

Treasury, which is a serious concern for the North American industry. On the positive side, the impact of tariffs to Linamar although not zero, is certainly not close to material for either the China, or metal tariffs.

Again, the concern is more about the impact to our customers and therefore the broader industry whether in auto, Ag [ph] or access. With that, I'm going to turn it over to our global VP -- VP of Global Finance Chris Merchant, to lead us through a more in-depth Financial Review.

Chris?

Thank you, Linda and good afternoon everyone. As Linda noted, Q1 was a good quarter as sales grew 4.3% despite a tough market environment.

All three regions were affected with Asia down 6.6%, Europe down 5.3% and North America down 0.2%. For the quarter, sales were $1 97 billion, up $80.6 million from $1.89 billion in Q1, 2018.

Operating earnings for the quarter were $187.7 million. This compares to $214.9 million in Q1, 2018 a decrease of $27.2 million or 12.7%.

Normalized operating earnings for the quarter were $197.7 million. Net earnings decreased $24.3 million or 15.5% in the quarter to $132.3 million.

Normalized debt earnings were $139.4 million for the quarter. As a result, fully diluted net earnings per share decreased by $0.37 or 15.6% to $2.

Normalized fully diluted EPS decreased by $0.21 to $2.11. Including earnings for the quarter was the foreign exchange gains for foreign exchange loss of $5.1 million which included a $6 million loss on the revaluation of operating balances and $0.9 million gain on the revaluation of finance financing balances.

The net FX loss impacted the quarter’s EPS by $0.06. From a business segment perspective, the Q1 FX loss due to the revaluation of operating balances of $6 million was a result of $4.8 million loss in Industrial and $1.2 million loss in transportation.

Further looking at the segments; industrial sales increased by 17% or $67.6 million to reach $465.1 million in Q1. The sales increase for the quarter was due to additional sales as a result of the acquisition of MacDon, favorable changes in foreign exchange rates since Q1 2018 and increases in European and Asian scissors.

Those were partially offset by the expected deferral of purchases by certain North American customers from Q1 to later in 2019. Normalized industrial operating earnings in Q1 increased $15.2 million or 24.2% over last year.

The primary drivers of industrial operating earnings results were included of the full quarter of MacDon’s earnings in Q1 2019, a favorable impact from exchange rates since Q1 2018 and increase in the scissor volumes in Europe and Asia at Skyjack, which were partially offset by increased commodity prices and the impact of differ in purchasing in North America. Turing to transportation, sales increased by $13 million over Q1 last year to reach $1.51 billion, the sales increase in the first quarter was driven by higher sales on our launching programs, a favorable impact from the changes in FX rates since last, which were partially offset by market declines in Europe largely due to the continued WLTP and diesel engine issues in addition to the market declines in Asia.

Q1 normalized operating earnings for transportation were lower by $27 million or 18.4% over last year. In the quarter transportation earnings were impacted by European and Asian sales declines on higher margin mature volumes, the impact of the transition to next-generation powertrain platforms weighing on margins in both launching and declining mature platforms are running at less efficiency at the current volume levels.

Additional costs related to heavy launch activity globally and the restructuring costs incurred in the quarter. These were partially offset by additional earnings from new launching programs and the favorable impact on the changes in FX rate since last year.

Returning to the overall Linamar results, the company's gross margin was $303.9 million and decreased $12.2 million due to the products mix issues related to the transition from more mature program sales to higher launching sales. Additional cost related to the heavy launch activity globally and increased commodity cost in the industrial segment, which were partially offset by a full quarter of MacDon’s earnings -- increased earnings from launching programs in both segments and a favorable exchange rates.

Cost of goods sold amortization for the first quarter was $94.8 million, cost of goods sold amortization as a percentage of sales was relatively flat at 4.8% of sales. Selling, general and administration costs incurred in the quarter were $110.2 million, up from last year at $106.6 million.

This increase is mainly due to the additional SG&A expenses as a result of having a full quarter of MacDon results in 2019. Finance expenses increased $2.9 million since last year due to higher interest rates from the Bank of Canada rate hike following Q1 2018, the inclusion of three months of interest expense related to the MacDon acquisition debt which were partially offset by the reduced interest expense as a result to debt repayments and higher interest earned on the investment of excess cash and on long-term receivable balances.

The consolidated effective interest rate for Q1 increased to 2.9% primarily due to the Bank of Canada rate hikes. The effective tax rate for the first quarter increase to 23.4% compared to last year, which was mainly driven by an increase in nondeductible expenses for income tax purposes.

We were expecting the effective tax rate for 219 to be in the range of 22% to 24%. Linamar's cash position was $486 million on March 31, an increase of $30 million compared to March 2018.

The first quarter generated $130 million in cash from operating activities which was used to fund and interesting payments. Please note that the new IFRS 16 standard was adopted as of January 1, 2019, the effect of the standard was to take all off-balance-sheet leases commonly known as operating leases and put them on the balance sheet.

The impact is primarily to the balance sheet where approximately $80 million of leases are now recorded as an increase in fixed assets and increase in debt. To compared to 2018 debt to 2019 you will need to adjust your 2019 to remove this impact to get a proper comparison as IFRS 16 restate do not exist in 2018.

Net debt pro forma EBITDA decreased to 1.78 times since the acquisition of MacDon despite the additional – the addition of approximately $80 million of new debt as a result of adopting IFRS 16 lease standard. We still expect net debt pro forma EBITDA to be back to one-times by the end of 2019.

The amount of available credit on our credit facilities were $692 million at the end of the quarter. To recap, Linamar have a good quarter despite the significant market declines in Europe and Asia.

Linamar was able grow sales, maintain EBITDA and to reduce debt excluding the impact of IFRS 16. That concludes my commentary.

I would now like to open up the call for questions.

Hi. Thanks for taking my questions here.

Maybe just first for me as relates to MacDon, its facing a number of headwinds related to the trade issues. I’m wondering if that’s change your long-term strategy or maybe your near-term strategy in terms of the growth levers you pull there; and whether its product expansion or geographic expansion?

Has that change over the past year as you try to maybe mitigate some of these trade risks?

I mean, our strategy for MacDon has not change. We are looking to grow the business globally.

We saw success with that already. In fact just in this quarter as noted MacDon is able to grow a global market share for their combine headers and that growth is coming from markets outside of North America, so, great to see success in that regard.

We continue to believe there’s massive opportunity to focus on that global growth. The global combine header market is 75% or more of it is actually outside of North America.

So MacDon who is primarily up till now focused on North America could literally quite triple their business by getting the same kind of market share globally as they have here announce. I mean, that’s not going to happen overnight.

There is a lot of work to do to that place, but absolutely that continues to be the long-term strategy. As they’re looking for additional products that the team could be selling through their distribution network, and I think the corn head is the super example of that.

I mean, they took that product – it’s a solid product. We have brand name it.

MacDon put it in to the distribution network and sales have tripled. So, I think that’s very positive.

When it comes to these trade issues, to me, its short-term noise and we need to look passive and not make import strategic decisions based on that. We can make short-term tactical decisions that long-term we have still need to focus on fundaments.

So we continue to believe very stronger in the MacDon story. The fact that they’re going to be flat this year when markets are down, is it itself a good indicator of the great business and product that they have that will be able to offset market softness with some market share growth.

That’s helpful. Thank you.

And then you provide a good color on I guess a book of business in Asia with the significant percentage of that growth related to new energy vehicles. I’m wondering as you grow into that book how should I think will content per vehicle in Asia?

Does the growth trajectory – is it a different growth trajectory that you would have seen in Europe and North America in the past because a higher percentage of the sales will be associated with an electrical compulsion vehicle?

Well, no, not at all. I mean, we’ve got good business that’s going to grow our sales in China by more than 50% over the next three, four years.

Then I’ve noted, 45% of that is electric. So, we’re seeing lots of exciting opportunities in that marketplace for both hybrid and battery electric vehicles across the wide range of products.

It’s very opportunistic, there is huge content potential for us in electric vehicles to the tone of somewhere around $2000 at a minimum. And so, we think lots of exciting opportunity and I mean, we’re turning back today.

That gives us a lot of room to grow.

That’s great color. And just last one from me, more of clarification question.

These deferred purchases in Skyjack that are being pushed of from Q1, is this primarily made up in Q2 or is it something that we should expect as a tailwind kind of through the balance of the year?

A lot of it would make up in Q2.

Q2. Okay.

Thank you very much.

No problem.

Hi. Good afternoon.

Just want to clarify some of the numbers one there on the guidance. There’s a lot of numbers given.

Just I guess now on a consolidated basis the expectation is mid-single digit growth and operating earnings versus high last quarter, is that right?

Yes. So, we’re looking at mid single-digit sales growth and now mid single-digit operating earnings growth.

I have put it backup on the screen as well for you.

Okay. And in industrial, I think it's now flat margins for the year.

You had a really good Q1. I’m just curious the incremental pressure, I don’t want to – I know its precious words, but is it predominantly MacDon?

Yes. So, I mean, the first quarter was pretty strong for MacDon, because the market was certainly flat.

It was up like one or 1.5%, but they grew market share, so they have the nice growth in the quarter. The Ag market is expected currently to decline in the balance of the year and more that performance going forward.

So MacDon will obviously want to offset that as that they came from market share, but we do expect to see that read-through to MacDon. So as noted if the market flat and Q1 was up, obviously the right think is here is going to be negative for MacDon.

Now offsetting that is going to be Skyjack which will have a stronger Q2 and Q3, right. So they had a flat first quarter because of the deliveries being pushed out, but the market is increasing in single digit and Skyjack is going outperform the market at high single digit or low double-digit.

That means growth in the next couple of quarters is for Skyjack, which more than offset the MacDon decline. So I think a good way to think about the industrial segment.

It’s kind of tempered growth over the balance of the year.

And just on the transportation, I think given the go ahead calls for flat margin, I mean, it was down quite a bit in Q1. You’ve got some of the pressure you basically want to launch costs in the mix.

It sounds that you continues for another quarter or two. I’m just sort of curious that the levers are to pull sort o make up the ground in the rest off the year on the margin?

Yes. So, we do expect to make that ground over the balance of the year more so in the back half of the year than in the front half just because of continued market pressures and because we’re continuing to work through that transition from old generation and new generation platforms and both of them running at the moment at sort of several optimal level.

So, we do expect to see things starting to improve little bit in Q4 more so Q3 and more so in Q4. So, the difference in margins this year versus last year obviously negative now but they are improving over the next couple of quarters and actually over prior year at the back half in order to get back flat.

Okay. It wasn’t clear to me.

Was there any earnings impact EPS in the quarter from the transition or IFRS 16?

We have debt impact, right, so we ended up with an extra about 80 million on the balance sheet shipping into debt, but there was no P&L impact.

Okay. Thank you and appreciate the free cash guidance as also.

Thank you.

There was – I believe the 4 million restructuring charge here in the quarter, can you tell us what that related to?

Yes. In a couple of different areas just reacting to some markets situations and also restructuring within our light metal casting group, so we’re doing – we’re changing the work structure a little bit, shifting more responsibility outside of the plant.

So there’s been severance [ph] associated with that this quarter and last quarter as well.

Okay. This just for all you’re seeing in Skyjack where some of your customers are customer delayed ordering from Q1 into further quarters just some of that relate to United Rentals acquisitions of BlueLine.

Is that the kind of thing you’re talking about?

Yes. That would have some impact for sure on their CapEx plans and certainly a lot of the orders that we had have just got pushed out because of that CapEx that they had and utilization.

Peter, I mean, they had to take some time to evaluate the assets as they got there with delay, but from what we’re seeing the actually even March shipments were up significantly and same with May and April.

Then our backlog is strong.

Okay. You mentioned MD&A that WLTP has still having in effect, do you think that round its way through or are there still powertrains that need to be qualified?

Yes. We see even just talking with OEMs that it will sort off bottom out by the end of Q2.

Okay. And then lastly these efforts that you're making with working capital, like your working capital investment in the quarter was less than it was last year, so you’re making progress in your non-cash working capital investment.

But I think and correct me if I'm wrong. I think you said last quarter you actually wanted to create cash through working capital.

You’re anticipating divesting or unwinding working capital so is that still the plan?

Yes. Absolutely, that is still the plan.

We’re going to see of the realization of those efforts in the back half of the year than in the front half of the year as we work through some of the long-term receivables. We’re looking at pretty new programs in place for my conference since that wouldn’t happen until the end of the year and other elements of inventory or more realistically going to be able to reduce in Q3, Q4 than in the first half.

Okay. And then just can you comment on the credit experience that you’re having with the long-term receivables that you’ve extended to the rental yard operators?

Yes. We obviously keep a very close eye on where we stand on those long-term receivables.

I’ll just remind you as well while we put a new in place last year as of quite the end sort of mid year last year. That’s basically put an external financing company in place to do the financing for those long-term customers.

So our level of long-term AR prospect that has actually been declining since sort of midyear, last year, so our exposure is gradually, obviously winding down and the risk shifting over to that external credits providers.

And if you have – what you have and you had any negative credit experience?

No.

No.

Nothing.

Okay. Glad to hear that.

Thanks very much.

Thanks. Good evening.

I just want to ask a follow-up on Peter’s question actually. You had a nice slide on free cash flow and then you just comment upon the components one of the main long-term receivables, but can you just talk about the magnitude of the working capital benefit you anticipate during 2019?

Well, I mean, it is a significant portion of that cash flow that we’re looking to – looking back to the slide that we’re looking to create. But at the same time don’t forget that earnings are up this year and – sorry to say this, our earnings are up this year and CapEx is down, so that in itself – and last year we generated $150 million of free cash flow.

So, we can get a chunk of that cash flow coming out of basically operations, and then another slide that will come out as a non-cash working capital. We haven’t concluded our slides which was [Indiscernible] of 500 to 700 between the tail.

But it is the combination of both.

Okay. And then just going through transportation margins with reset again, I presume I know the answer to this, but I just want to understand the cadence of margin as you go through the year as you’ve comment you expect headwinds for another quarter or two.

Should I presume that we should expect the trend to be some pressure in Q2, and then that you revert back deposit with the performance you had in Q3 of last year. Is that how we should be looking at it?

You’re definitely going to continue to see impacts in the second quarter, I mean, I think that if that comparison to prior year, the differential is definitely going to shrink, but its not going to completely go away, you won’t see that until Q3 and Q4, at which place you’ll actually see a more positive margin compared to last year.

So the inflation doesn’t happen in Q3?

Yes.

Great. And the last question, Mark asked this earlier, but I understand IFRS 16 had no impact upon P&L.

Do you know what the impact on EBITDA was?

We’ll have to come back to on that Brian. I don’t know, off the top of my head, but I’ll get Dale to give you shade back on that.

Okay. That’s great.

Thank you for your time.

Yes. I’ve got a question with regards to the normal course issue bit and I saw as of March 31, I think there were 45,000 shares that have been repurchased.

Is that the intent of the company to perhaps focus on the reduction of debt before they address share repurchases over the next 10 to 12 months?

Yes. I mean, we have for sure taken the more cautious approach to the market on our MCIB [ph] we’re definitely conscious at that level targets and really wanting to achieve those and trying to balance those goals with goals around the buyback which we understand its important to shareholders, so important to us as well.

What we’ve done is try and use sort of a discipline systems to buy when we see [Indiscernible] and hold off when we see the share price strengthening and we will look to continue to adjust that and continue to balance, what do we want to do on MCIB and what do we want to do on debt reduction throughout the next 12 to 18 months.

I see. So, it just a perspective with regards to where you see the best allocation of debt repayment to where and the cash flow that you project in the next year or so, and then you allocate accordingly?

Exactly.

Okay, great. Thanks Linda.

I appreciate it.

No problem.

Okay, great. Thanks very much.

To conclude this evening, I'd like to leave you with three key messages. First, we are very happy to see both sales and market share up in most of our businesses this quarter despite challenging market acquiring [ph] Linamar’s constant above market performance through that historical economic cycle.

Second, we are expecting to see strong cash flow this year of $500 million to $700 million which will further fortify our already strong balance sheet. And finally, we are excited about the new opportunities we’re seeing in electrified vehicle both battery electric and fuel cell electric as our industry evolve towards the future.

Thanks every much everybody and have a great evening.