I would like to welcome everyone to the AMETEK Second Quarter Earnings Conference Call. All lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question-and-answer session. Thank you. Mr. Kevin Coleman, you may begin your conference.

Great. Good morning. Thank you everyone for joining us for our second quarter earnings conference call. With me this morning are Dave Zapico, Chief Executive Officer, and Will Burke, Executive Vice President and Chief Financial Officer. AMETEK's second quarter results were released earlier this morning. These results are available electronically on market systems and on our website at the Investor Section of the ametek.com. This call is also webcasted. It can be accessed on our website and at streetevents.com. The call will be archived on both of those sites. Before we get started, I will remind you that any statements made by AMETEK during the call that are not historical in nature are to be considered forward-looking statements. As such, these statements are subject to change based on various risk factors and uncertainties that may cause actual results to differ significantly from expectations. A detailed discussion of the risks and uncertainties that may affect our future results is contained in AMETEK's filings with the Securities and Exchange Commission. AMETEK disclaims any intention or obligation to update, or revise any forward-looking statements. I'll also refer you to the Investor Section of ametek.com for a reconciliation of any non-GAAP financial measures used during this call. We'll begin with some prepared remarks by Dave and Bill, and then we'll open it up for questions. I'll now turn the meeting over to Dave. David A. Zapico - Chief Operating Officer & Executive Vice President: Thank you, Kevin. Good morning. AMETEK delivered a second quarter results that were in line with our expectations, reflecting the strong efforts of our businesses in managing in a challenging global environment. Also, subsequent to the end of the second quarter, we acquired two businesses, Nu Instruments, a leading provider of magnetic sector mass spectrometers and HS Foils, a provider…

Okay, great. Thanks, Bill. Hey, Brandi, we are now happy to open it up for questions.

Your first question comes from the line of Nigel Coe with Morgan Stanley. Nigel Coe - Morgan Stanley & Co. LLC: Thanks, good morning. David A. Zapico - Chief Operating Officer & Executive Vice President: Good morning, Nigel. Nigel Coe - Morgan Stanley & Co. LLC: Good morning. Yeah. So, I guess obviously tough end market conditions. But if I compare – the last time we had big end market declines back in 2009 to today, you held the line on margins much better then. I'm just wondering maybe, David, if you could just maybe compare and contrast 2009 to here, what led you to keep margins pretty flat to slightly up during that period. And obviously we're seeing a bit more pressure today. David A. Zapico - Chief Operating Officer & Executive Vice President: Right. That's a great question, Nigel. You'll recall, 2009 was much different than it is in the current environment. All of the markets were down and we took action to deal with all the markets then it returned very quickly. But in the current environment, a couple of our markets are down, but some of our markets are hanging in there fine. So, the difference really is, it's a much slower market and the market has drug on for some time. And we have a much higher margin company right now. Remember that we were a mid-teens operating income margin company. Now we're much higher. And the two markets that are down, about 20% of our company, oil and gas and metals are down 30%. So, that's a difficult tailwind to offset, but we've done a good job to do it. We still have 22.4% operating margins and we had a good operating quarter. Nigel Coe - Morgan Stanley & Co. LLC: Okay. No, I…

Your next question comes from the line of Robert McCarthy with Stifel. Robert McCarthy - Stifel, Nicolaus & Co., Inc.: Hi. Good morning, everyone. How are you doing today? David A. Zapico - Chief Operating Officer & Executive Vice President: Good morning, Rob. Robert McCarthy - Stifel, Nicolaus & Co., Inc.: Okay. A couple of questions. One, I think I it was customary in the past that Frank would kind of go through the state of some of the sub-segments in terms of what we're seeing, in terms of growth and just a little bit of more color. If you could do that kind of State of the Union for AMETEK, right now, that would be helpful? David A. Zapico - Chief Operating Officer & Executive Vice President: Sure, Rob. I'll start with EIG aerospace. EIG aerospace sales were flat as compared to the last year, as we saw continued strong growth across the commercial business that was offset by weakness in the business and regional jet market. For all 2016, we expect a similar trend to continue as the second quarter, with the commercial market being strong and offsetting weaker business than regional jets. This business continues to deliver strong new programs wins. These wins are across a wide range of platforms, including commercial OEM, business and regional jets, military. And year-to-date they have already won $230 million in life of program wins. So we're really excited about the new business we're winning in that market. And you know that's important for the future of any aerospace business. Next sub-segment where we process. Organic sales in process were down mid-single digits in the quarter, driven largely by weakness across our oil and gas business. Our Ultra Precision Technology business performed very well in the quarter. That team has done…

Your next question comes from the line of Scott Graham with BMO Capital Markets.

Hey, good morning. And welcome to chair your first call, Dave. David A. Zapico - Chief Operating Officer & Executive Vice President: Thank you, Scott.

Good morning, Bill, as well Kevin. Unfortunately, it comes under not terrific auspices, but I certainly did like the answer to, or how you finished Rob's question just now. I guess maybe more surgically, I was wondering if you could tell us what were the pressure points on the second half effective guidance reduction here? What changed? You seem to have pretty good line of sight, you gave us some really good numbers in the first quarter as to why the guidance needed to come down. Could you maybe do something similar to that for the second half to perhaps make us feel as good as you feel about the full-year guidance at this point? David A. Zapico - Chief Operating Officer & Executive Vice President: Yeah. So there is kind of two questions there. One, really what's driving the takedown and why do we feel good about the stabilization. So I'll take the first point. Really, if you look at it, it can be explained really easily economically. Our organic growth is dropping 2.5 points versus the prior forecast or approximately $100 million. And it's really driven by oil and gas, and metals. That results in a 50% decremental. Oil and gas is one of our most profitable businesses. So if you take that $50 million and you look at the number of shares we have, it turns out to $0.16. So that puts you right in the mid-point of the guidance range. So that's what happens economically. When we look out for the balance of the year, really our EMIP business we thought that was going to pick up and now it's not. And we can talk about that a little more in a bit, but fundamentally we got comfortable with it because it's flat. We saw the…

Dave, that was very helpful. I very much appreciate that. But obviously the thing is, is that we – with the exception of the new rigor and the new sort of construct you have around the guidance, we did hear that in the first quarter, oil prices are now lower again, I know it's a small business but truck is falling apart. And then you have Brexit potentially affecting Europe. So if your reduction in guidance is only around oil and gas and metals, is there essentially a lift in the cost savings number to make sure you get there, that's kind of where I may be coming up short? David A. Zapico - Chief Operating Officer & Executive Vice President: Right. Yeah, our cost reductions are $130 million for the year. So, it's the same number that we communicated last quarter and really on lower volume, we're purchasing less material, but we're confirming the $130 million number. So, the cost reduction is embedded in it. You mentioned Brexit, there is a situation where we are balanced in revenues and expenses. We have 5% of our sales in UK. We're balanced in revenues and expenses, so we have a natural hedge. So we're not going to have any transaction or translation surprise, so we have, expect a short-term impact to be minimal. We've been checking with our UK businesses on a weekly basis. So we haven't seen any downturn in orders yet, mainly because we're in a market that's not maybe tied to the consumer there. And you're right, longer-term impact; it will be driven with the economic growth, on the European and the global growth. And then, this uncertainty is going to go on for some time, but we're feeling pretty good about our exposure. And there are weak global macro conditions. I mean we highlighted oil and gas and metals, but certainly the global economy is not good, and you have the spillover effect from oil and gas into the other markets. So, all the markets are tough. Again, with the first half or the second half they're essentially carbon copies of each other and we are very comfortable with it.

All right. That's great, Dave. Thanks very much. David A. Zapico - Chief Operating Officer & Executive Vice President: Sure, Scott.

Your next question comes from the line of Allison Poliniak with Wells Fargo.

Hi, guys, good morning. David A. Zapico - Chief Operating Officer & Executive Vice President: Hi, Allison.

Dave, I just want to go back, you said, to sort of that metals commentary, I guess, high-level. I agree we would have thought that we would have seen improvement there, can you kind of walk us through what happened, what changed in that business that's driving sort of a lower expectation for the back half now? David A. Zapico - Chief Operating Officer & Executive Vice President: Right, sure. First, let me take a moment, in this business, we take metals, metals such as Titanium, Vanadium, Cobalt, Nickel, Molybdenum and process them with very unique processing capabilities into specialty alloys, powders, components and we are very – we have strong niche positions and we feel very good about this business. What's happening is two things, visibility and inventory. In this business, we tend to be four to five levels removed from the ultimate end customer or application. So, as a result the visibility is limited and we can get misaligned with the broader end-market demand given the inventory buildup in the channel and we are seeing this play out right now. To give you a tangible example, we produce specialized master alloys which is a critical component in that the making of titanium parts for aircraft, we're one of the few producers who can make the specialized alloy, but – we're far down removed on the food chain. So, we sell to a titanium melter, who sells to an ingot maker, who sales to a part manufacturer, who sells to a sub-assembly manufacturer, who eventually gets on the airframe. So, we are quite a way removed in this business, different than most of our businesses. And we really, we identify some secondary inventory locations who have some inventory. So although the long-term demand for titanium master alloy, in this case an aircraft, is very strong with new aircraft using more titanium, the short-term demand for alloys has been impacted by this excess inventory in the supply chain.

Is there any sense of when that excess inventory would be cleared? David A. Zapico - Chief Operating Officer & Executive Vice President: Yeah. It's not going to clear in 2016, but we're still bullish that it's going to clear and it will be in 2017.

Thank you. That's helpful. And then on the new acquisition, you had talked about expanding it into the new market; can you expand on that, like where would that sort of a new market be for AMETEK? David A. Zapico - Chief Operating Officer & Executive Vice President: Yeah. Right. That's a great acquisition. We're talking about Nu Instruments and they are very analytical high-end magnetic sector mass spectrometers and the markets that we're in currently are similar to the markets that our CAMECA business is in, the research market and environmental, I mean in the environmental sciences, material characterization, nuclear. But the one new market that we're interested is, they have a new product that's in the food and beverage testing market. And the interesting thing about it, in the news, there is a lot of questions about food contamination and the interesting thing about the new equipment is it is so sensitive, and has a unique processing capability, it can actually tell if there is a contamination, and it's sensitive enough to tell where in the world the food is from. So we're very optimistic for the food testing market, and that business, if you take a step back, the business had basically one sales person. And they have great technology and we're going to plug it into our CAMECA business with a tremendous sales and service network and really optimistic about the potential for Nu.

That's great. Thanks so much. David A. Zapico - Chief Operating Officer & Executive Vice President: Sure.

Your next question comes from the line of Christopher Glynn with Oppenheimer. Christopher Glynn - Oppenheimer & Co., Inc. (Broker): Thanks. Good morning. David A. Zapico - Chief Operating Officer & Executive Vice President: Good morning, Chris. Christopher Glynn - Oppenheimer & Co., Inc. (Broker): Good morning, Dave. You referenced a bit of a 3Q step down clearly on the EPS. Is that all volume related and what exactly drives the step back in 3Q versus the kind of run rates for the year? David A. Zapico - Chief Operating Officer & Executive Vice President: Right. Yeah. Its change from Q2 to Q3 can be explained by lower sales volume. So, our EPS is lower because of volume and typically we have a – Europe has some slower months and we have seasonality in Q3 that drops back a bit. And in Q4, there is really our normal seasonality. And as I said before, Q4 is really a carbon copy of the quarter, we just completed. So, we feel pretty good about it. Christopher Glynn - Oppenheimer & Co., Inc. (Broker): Okay. It make sense. And then on the deals, I think you mentioned, a $150 million total sales acquired to-date, disclose Nu if I look at the first quarter deals. I think it all implies HS Foils is similar in size, do I have that right, to Nu. David A. Zapico - Chief Operating Officer & Executive Vice President: Yeah. I think the numbers are wrong, it was a $115 million. Christopher Glynn - Oppenheimer & Co., Inc. (Broker): Oh, $115 million. Got it. David A. Zapico - Chief Operating Officer & Executive Vice President: So, what you really have with Nu – we've paid a price that was a little more than two times sales, close to two times sales. And the, it's nine times the first year EBITDA and HS Foils is smaller. It's significantly smaller. It's a technology acquisition, that's really going to help us drive organic growth and we're optimistic about it, but it's in the low millions of dollars in terms of the technology. Christopher Glynn - Oppenheimer & Co., Inc. (Broker): Okay. That clears it up. Thanks. David A. Zapico - Chief Operating Officer & Executive Vice President: Yes. No problem.

Your next question comes from the line of Matt McConnell with RBC Capital Markets.

Thank you. Good morning, guys. David A. Zapico - Chief Operating Officer & Executive Vice President: Good morning, Matt.

Just a follow up on the specialty metals business. So, and I certainly understand that these end-markets are fundamentally pretty healthy, so is this a permanent change in how the supply chain is managing inventory, or are there any competitive shifts going on here that are notable? And just, any permanent change in the level of activity in the specialty metals business? David A. Zapico - Chief Operating Officer & Executive Vice President: No, it's not a permanent change, Matt. I mean, it's an issue where the metals market that I talked before, about the complex supply chain, it's kind of in between us and really good end-markets. And that market is in – it's into stress right now. So the customers are managing their inventories for cash, they're being very aggressive in terms of working capital, but long term, we're very bullish. I mean, if you look at the titanium used in aircraft, if you look at – that's all growing with the A315 and 787, if you look at the other end-market applications in medical and specialized industrial, we're very bullish. I mean, certainly, we have a FX that's creating headwinds with that business along with some of our other business, but there really is no competitive dynamic that's major, and the market is going to return and we're going to have good businesses in good positions, and we just have to wait it out. And we – I talk a lot about the visibility and the inventory, but that's the key factor. It is not an issue where it's not going to come back.

Okay. Thank you. And so, following up on some of the stabilization comments you made. You gave great insight around your level of conviction to that comment for oil and gas, some customer comments and actions, how about outside oil and gas? Any other – do you have orders or backlog or any other comments to give you confidence about stabilization ... David A. Zapico - Chief Operating Officer & Executive Vice President: Yeah.

... in the other parts of your business? David A. Zapico - Chief Operating Officer & Executive Vice President: Yeah, our backlog is $1.1 billion. I mean, if we look at the run rates and we spend a lot of detail on it, it gives us confidence for the back half of the year. So again, we mentioned that the metals business is already performing from – and that's flat sequentially from Q1 to Q3. There's not much change in the other parts of our business. And there's not much change in the market. You really have a slow global macro environment and the two things we've been trying to get our hands around are really oil and gas, and metals, but the balance of the business is performing as we expected.

Okay, great. Thank you. David A. Zapico - Chief Operating Officer & Executive Vice President: Sure.

Your next question comes from the line of Richard Eastman with Robert W. Baird. Richard Eastman - Robert W. Baird & Co., Inc. (Broker): Yes, good morning. David A. Zapico - Chief Operating Officer & Executive Vice President: Good morning, Richard. Richard Eastman - Robert W. Baird & Co., Inc. (Broker): Dave, or maybe this is a question for Bill, but could you just explain the decremental EBIT in EIG? And roughly flat core sales, we delivered something like $9 million less of profit. Is that all mix shift with oil and gas being weak? William J. Burke - Chief Financial Officer & Executive Vice President: I think in EIG, we had a negative 6% core. So what you're seeing is roughly, I think it's a 50% kind of decremental margin in that business. You've got some of the higher margin businesses going down, and that's really what's driving the decline quarter-over-quarter in terms of the profitability in the business. David A. Zapico - Chief Operating Officer & Executive Vice President: Another point I would add to that, Richard is, really as you think about what happened last year, our mid and downstream oil and gas businesses were still running very strong. So, you have that business as very profitable and now it has started down. So, that's a – one of the... Richard Eastman - Robert W. Baird & Co., Inc. (Broker): Okay. David A. Zapico - Chief Operating Officer & Executive Vice President: ...the profit impacts in Q2 year-over-year. Richard Eastman - Robert W. Baird & Co., Inc. (Broker): Okay. And then I noticed from your comments, Dave, when you kind of laid out some of the sub segment expectations for sales, the cost driven motors business now is going to be down mid-single digits verus flat, but…

Your next question comes from the line of Andrew Obin with Bank of America.

Hi, and this is Akshay Bhatia on for Andrew. I just wanted to dig into your energy exposure a little bit, could you remind us what your exposure is between upstream, midstream and downstream after a couple of years of downturn, and maybe could you talk about some of the trends you saw over the course of the quarter, how April compared to June across these different business lines? David A. Zapico - Chief Operating Officer & Executive Vice President: Right, it was difficult to hear you, but I think I have your question. Yeah, the oil and gas business as we talked before was lower than forecasted in Q2, but stabilized. So we saw orders in that second quarter that really matched our Q3 volume level. So we feel good about that. Coming into the year, it was about a $360 million business for AMETEK, about a third of that is upstream, a third of that is midstream and a third of that is downstream. The business is one-third in the US and two-thirds international. So we have a $120 million take down this year. So the $360 million is going to be down $120 million, that's about a third, and it's about $60 million down in upstream, and $60 million down the combination of midstream and downstream. So if you look at our upstream exposure, that's down about 60%, and our midstream and downstream exposure is about 20%.

And I know you talked about pricing overall being up 1% but maybe could you discuss pricing that you're seeing specifically in the energy market? David A. Zapico - Chief Operating Officer & Executive Vice President: Yeah. The pricing in the energy market is below the average for the whole company. It's a very difficult environment. They've had to reduce costs to stay in business. We still can maintain pricing because we have very premier positions with niche-differentiated technologies. But it's certainly not at the AMETEK level on average and it's down a bit in the energy market, more in the upstream than the midstream and downstream.

All right. Thank you.

Your next question comes from the line of Bhupender Bohra.

Hey, good morning, guys. David A. Zapico - Chief Operating Officer & Executive Vice President: Good morning, Bhupender.

Hi. Just on the orders growth here. Could you give us the number and organically what the orders growth were for EIG and EMG in the quarter? David A. Zapico - Chief Operating Officer & Executive Vice President: Sure. Organic orders were minus 7%, so that was in line with sales. And our EIG organic orders were down 5% and EMG organic orders were down 9%.

Okay. And we have been talking about products in the end-markets. I think, I just wanted to focus on the geographic mix here, if you can give us some color how the emerging markets did actually in the quarter, because oil and gas is like two-third is international, just wanted to get a sense of how it did in like a Europe, Asia Pacific and outside the US, too? David A. Zapico - Chief Operating Officer & Executive Vice President: Yeah, sure, Bhupender. I'll go around the world. In the US, we were down high single-digits versus last year. There are broader industrial weakness, but the key factors driving the negative growth were oil and gas and metals. In Europe, it's been – it was down low-single-digit. So we've been at that level for several quarters. Oil and gas impacted the region, but we don't have much metals exposure in Europe. And in Asia, we were down mid-single-digits and China was down mid-single-digits. So, there is a little bit of an improvement in China, there was a better trend for Asia where we were down double-digits for three quarters in a row and now we are down mid-single-digits and China was a negative for us. So, orders for the region, the entire Asia region were a little bit better than prior years. So, it seems to be that, that Asia is stabilizing, China is stabilizing and the one emerging market that I'd point out is doing better than the others is India, that's about the mid-single-digit growth, and it's a much smaller exposure but our investments there are paying off.

And how should we think about how these markets would act or what kind of assumptions you have for the second half? Like which of these markets would be kind of remaining stable along the lines you just mentioned or they would deteriorate further? David A. Zapico - Chief Operating Officer & Executive Vice President: Yeah. If I look at the trends in the US even though we're down high-single digits, it's slightly better from last quarter. Europe, that same trend is continuing and in Asia, we are improving a bit but really it's – we don't have anything factored in, it's really a down mid-single-digit. So, geographic-wise it's square with our concept of stabilization. I mean fundamentally our business has stabilized and then – and we are working on our earnings growth for 2017 now. We're focused on our business. We are getting ready to go into our budgeting process and that budgeting process that we go through in Q3 and spreads into Q4, there is really no area immune from efficiency improvement. We are going to look at things like global sourcing, low-cost region production, value analysis, value engineering, plant consolidations, engineering, all of the tools that we have and we are going to get a healthy cost reduction target. And we're going to pair that with acquisitions and that's how we are going to grow our earnings next year. So the geography is not a big factor in thinking through what we have to do for the balance of the year or what we have to do next year.

Okay. And if I go back like a few quarters here when Frank was there, he did mention that AMETEK could actually grow their margins by 30 bps to 40 bps I believe, if I'm right even in a declining organic growth sales. Now, how should we think about the back half of this year, are we – any assumptions here, where the focus will be more on the cost side as the macro is kind of... David A. Zapico - Chief Operating Officer & Executive Vice President: Right, right. For the year, we're saying operating income margins will be down a 130 basis points to 170 basis points. In the longer term – I mean given our high margin contribution margin businesses and given our operational excellence capabilities as far as the eye can see, when we get out of these market conditions and we return to internal growth we have the same 30 bps of margin expansion for the long-term.

Okay got it. And lastly, just wanted to tap into your oil and gas, you just gave a number of $360 million, is that company-wide, that's the direct exposure or ... David A. Zapico - Chief Operating Officer & Executive Vice President: Yeah. That's direct exposure, it's not indirect exposure, saw some impact in other markets that are not oil and gas related but that's a direct exposure and that will be done about a $120 million this year.

Right, that's what, I just want to get a sense of – because when we think of AMETEK we think of oil and gas to be about like let's say 9% of total sale, which is about like $360 million which we just gave. David A. Zapico - Chief Operating Officer & Executive Vice President: Right.

When we look at indirect exposure within EMRP and some other markets where oil and gas is definitely one of the markets where you're serving. I don't know if you've done some work internally to kind of give us a sense of what the indirect exposure would be. David A. Zapico - Chief Operating Officer & Executive Vice President: No – yeah, the total market exposure for AMETEK, most of it's in process. But, the total market expansion for AMETEK, exposure – going into the year with $360 million, that's the entire exposure. I was talking about the indirect exposure. For example, when you look at the helicopter market, I mean they're using helicopters to fly to offshore platform. So there's less demand for helicopters and that's in our business jet, regional jet segment. That's what we report it. So when I was talking indirect, I was talking about the total oil and gas exposure is the $360 million.

Okay. Got it. Thank you. David A. Zapico - Chief Operating Officer & Executive Vice President: Sure.

There are no further questions at this time. I will now turn the call back over to Mr. Kevin Coleman. Please go ahead.

Okay, thank you, Brandi. Thanks everyone for joining the call today. As a reminder, a replay of the call can be accessed at ametek.com and streetevents.com. And as always, we're available for additional calls and questions this afternoon. Thank you.

This concludes today's conference call. You may now disconnect.