Ladies and gentlemen, thank you for standing by, and welcome to the Fourth Quarter 2021 AMETEK, Inc. Earnings Conference Call. [Operator Instructions] It is now my pleasure to introduce Kevin Coleman, Vice President of Investor Relations and Treasurer.

Thank you, Andrew. Good morning and thank you for joining us for AMETEK's Fourth Quarter 2021 Earnings Conference Call. With me today are Dave Zapico, Chairman and Chief Executive Officer; and Bill Burke, Executive Vice President and Chief Financial Officer. During the course of today’s call, we will make forward-looking statements, which 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 SEC. AMETEK disclaims any intention or obligation to update or revise any forward-looking statements. Any references made on this call to 2020 or 2021 results will be on an adjusted basis, excluding after-tax, acquisition-related intangible amortization and also excluding the gain from the sale of Reading Alloys in the first quarter of 2020 and the realignment charge taken in the first quarter of 2020. Reconciliations between GAAP and adjusted measures can be found in our press release and on the Investors section of our website. We'll begin today with prepared remarks by Dave and Bill and then open it up for questions. I'll now turn the meeting over to Dave.

Thank you, Kevin, and good morning, everyone. AMETEK concluded 2021 with an excellent fourth quarter. Stronger-than-expected sales growth and outstanding operating performance resulted in robust profit and earnings growth. Demand remains strong and broad-based across our end markets, leading to superb order growth and a record backlog as we enter 2022. We are integrating six recent acquisitions into the AMETEK growth model and are well positioned to deploy capital on additional acquisitions, given our excellent cash flow generation and strong balance sheet. We asked a lot of our teams in 2021 and as the pandemic and supply chain tightness led to disruption and uncertainty. As always, our colleagues stepped up to these challenges and delivered tremendous results. Thank you to all AMETEK colleagues for your hard work and tremendous contributions to our success. Now let me turn to the fourth quarter results. Fourth quarter sales were a record $1.50 billion, up 25% over the same period in 2020 and above our expectation. Organic sales growth was 17%. Acquisitions added nine points and foreign currency was a one point headwind in the quarter. Overall, orders in the fourth quarter were $1.61 billion, an increase of 26% over the prior year period, while organic orders were up an impressive 22% in the quarter. We ended the quarter with a record backlog of $2.73 billion, which is up over 50% from the start of the year driven by strong, underlying orders across our businesses, plus the contributions from acquisitions. Fourth quarter operating income was a record $361 million, up 21% versus the fourth quarter of 2020 and operating margins were 24%. Excluding the dilutive impact of acquisitions, core operating margins were 25.8%, up a very strong 90 basis points versus the fourth quarter of 2020. EBITDA in the fourth quarter was $437 million,…

Thank you, Dave. As Dave highlighted, AMETEK had an impressive finish to 2021 with outstanding operating performance leading to better-than-expected results in the fourth quarter. Let me provide some additional financial highlights for the quarter and the full year as well as some additional guidance for 2022. Fourth quarter general and administrative expenses were $23.7 million, up $6 million from the prior year largely due to higher compensation expense. For the full year, general and administrative expenses were up $19 million, also driven largely by higher compensation costs. For 2022, general and administrative expenses are expected to be roughly in line with 2021 levels and approximately 1.4% of sales. The effective tax rate in the fourth quarter was 17% down from 20.1% in the fourth quarter 2020. This lower tax rate was due to return to provision adjustments. For 2022, we anticipate our effective tax rate to be between 19% and 20%. And as we've stated in the past, actual quarterly tax rates can differ dramatically, either positively or negatively, from this full year estimated rate. Working capital in the quarter was excellent at 15.2% of sales; this reflects the strong work from our teams in managing working capital. We have also strategically added inventory in certain areas to help address the longer lead times we are experiencing across the supply chain. Capital expenditures were $43 million in the fourth quarter and $111 million for the full year. Capital expenditures in 2022 are expected to be approximately $125 million or about 2% of sales. Depreciation amortization expense in the quarter was $78 million and for the full year was $292 million. In 2022, we expect depreciation and amortization to be approximately $320 million, including after-tax acquisition-related intangible amortization of approximately $150 million or $0.64 per diluted share. We continue to…

Thank you, Bill. Andrew, could we please open the lines for questions?

Certainly. [Operator Instructions] And our first question comes from the line of Allison Poliniak with Wells Fargo.

Hi. Good morning.

Good morning, Allison.

Good morning, Allison.

It's a great order backlog numbers. I would just like to get maybe a little bit more color in terms of how this backlog might be looking differently than historical, I think we've talked about duration extending a little bit. Is that still happening? Are you seeing any orders sort of getting pushed to the right because of your customers, maybe their labor issues? Just any color on how that's sort of evolving over the past year for you?

Yes. I mean the orders have been very strong and I think it reflects organic growth initiatives and also the recovery of the economy. And we're doing very well, and if you look at our portfolio the one aspect that hasn't fully recovered is really our aerospace and defense business and our oil and gas businesses. But the rest of the portfolio, their mid-cycle businesses are doing incredibly well and I call out our automation business, which is doing extremely well, and I'd also call out our process business, which has really got momentum. But it's across the board and on top of that, it was – for the quarter, the way the quarter played out, it was each month of the quarter got better. And on orders, December was the highest month we had in the whole year. So we ended on strength and we have a very healthy backlog. And the one thing I mentioned a few calls ago is I think our customers, because of some supply chain challenges across all the market, are giving us a look into what their demand patterns are. So we're seeing orders earlier, but that doesn't take away from the strength that we're feeling in the business.

Great. No, that's helpful. And then a nice investment or dollars being allocated towards investment this year and then you talked to some high-level thoughts there. Any specific verticals that maybe you're more focused on than others? I know you highlighted a few product capabilities. Just any color there?

Yes. I think the – we're making broad-based growth investments, and we're getting tremendous return from our engineering investment and it's across the board. You understand the way we manage our portfolio, but the sustainability opportunities for us are growing, and we're investing them. This year, we'll put about $110 million of incremental growth investments in our business. So that's on top of last year's incremental investments and those are in RD&E in sales and marketing. But fundamentally, we see opportunities and we're going to invest in additional $110 million, and we're going to keep the momentum going.

Great. Thanks so much. I will pass along.

Thanks, Allison.

Thank you. And our next question comes from the line of Deane Dray with RBC Capital Markets.

Thank you. Good morning everyone.

Good morning, Deane.

Good morning.

Hey, it's very impressive giving the understanding of how tough the supply chain issues are inflation, labor shortages and everything and you're still able to deliver these numbers because a lot of your peers are struggling here. And maybe – look, I know its lots and lots of hard work. Your business mix tends to have a bit more what I'll call medium technology that has microprocessors, chips and we're seeing companies that are saying, "Look, that's the biggest chokepoint for them", but we're not hearing that from you. But just what is it about either your mix or your dual supply? You've done something very well here given what your exposures might have been. So maybe kind of help us there.

Yes. I'll try to give you some more color there. I mean, everything that you said is true and we're experiencing the same challenges as everyone is with supply chain, logistics, labor availability. And the Omicron variant certainly added a lot fourth quarter and Q1. But our overall response to these challenges has been outstanding. And I think the first point is our distributed business model, where we have committed P&L managers running their business units with their own supply chain teams, which allows them to react quickly to changing conditions. And at the same time we have these business teams; we have a corporate centralized supply chain team that acts with all the combined leverage in the forte of AMETEK. And these teams work seamlessly together, and this overall approach has been extremely effective for us. As I mentioned in the last quarter and this quarter, it's directly what you said semiconductor chip availability, we have a lot of shortages, but that's the biggest area. And that's the one that's the most challenging and we're going after that a few ways. I mean, we're using our leverage of AMETEK. We have relationships built-up over a long period of time with the supply base. Our engineering capability is second to none, and we use it to qualify second sources, find alternatives, do redesigns and we've also taken a team of people across the company. Some of them are based on our Bangalore engineering office. Some of them are based in Germany. Some of them are based in the U.S., and that team is available to quickly help our business units for shortages and find alternatives, and that's working quite well. So we don't really improve – anticipate improvements and availability of semiconductor chips until the second half of 2022 at the earliest, and it's certainly a challenge. But I think we've had an effective response to it for the reasons that I just mentioned.

That's great. I really appreciate that additional color. And maybe if you could just take us through your key end markets for updates there and regions, if you could?

Sure. I'll start with the Process business. The Process overall sales were up 20% – low 20% in the quarter driven by strong organic sales growth and the contributions from the acquisitions of Magnetrol and Alphasense. Organic sales were up high teens for process. Our Materials Analysis businesses showed the strongest growth, they were driven by as I said in my prepared remarks, like Gatan and CAMECA. The businesses have leading positions providing high-end instrumentation into life sciences and semiconductor markets. And looking ahead for Process, we expect organic sales for our Process businesses to be up mid- to high-single digits for the full year. Now I'll switch to Aerospace. Overall sales for Aerospace & Defense businesses were up over 40% in the fourth quarter, driven by the acquisition of Abaco and mid-single-digit organic sales growth. Our commercial businesses led to growth in the quarter driven by strong aftermarket and business jet growth, while our defense businesses were down slightly in the quarter due to some shipment delays, it still had another strong year. Shifting to 2020, while we remain cautious about the patient the commercial aerospace recovery we're still well positioned to benefit from the recovery, given our attractive positions in a diverse set of commercial and business jet platforms. So for 2022, we expect mid-single-digit organic sales growth for our Aerospace & Defense businesses with both defense and commercial expected to be up mid-single digits. And I go to our Power & Industrial market segment next. Overall sales for Power & Industrial were up over 25% in the fourth quarter and a very good fourth quarter, driven by mid-teens organic sales growth and the contributions from the acquisition of NSI-MI. And for all of 2022, we expect Power & Industrial to be up mid-single digits with similar growth across our Power and Industrial segments. And finally our Automation & Engineered Solutions. both overall and organic growth for Automation & Engineered Solutions were up low 20% in the quarter. Automation businesses delivered outstanding growth in the quarter and full year with continued solid demand across our end markets. And in 2022, we expect organic sales for Automation and Engineered Solutions to be up mid- to high-single digits with similar growth across our Automation & Engineered Solutions. So if you look at the big picture, our Process and Automation & Engineered Solutions, market segments are going to be up mid- to high-single digits and Aerospace and Power and Industrial will be up mid-single digits.

That's really helpful. Thank you.

Thank you, Deane.

Thank you. And our next question comes from the line of Jeffrey Sprague with Vertical Research.

Hi, guys. It's Andrew Shlosh on for Jeff. How are you?

Hi, Andrew.

Good. Good. Thanks for taking the question. Firstly on price cost, do you kind of have a view on the cadence if at all, any improvement of price cost throughout the year? I mean what's your view there?

Throughout 2021 or 2022?

2022, another – yes.

Yes. For some context, we had – for 2021, we had about 3.5% of price and inflation, total inflation in our business was in the mid-2s. And for next year, we're expecting inflation to tick up a bit. So instead of the 3.5%, maybe 3.5% to 4% – excuse me, we're expecting our pricing to pick up a bit to 3.5% to 4%, and inflation 3% to 3.5%. So we'll see – we budgeted a 50 basis point spread for a positive price inflation spread. And we see it a bit higher in Q1, and we're expecting it to level off after that. But end of the day, it's about – price is about 3.5% to 4% for 2022. And the results speak to the highly differentiated nature of AMETEK's product portfolio. That's the way we're able to get price in excess of inflation in our business. We have leadership positions in our niche markets around the globe. So does that answer your question?

Absolutely. No, that's great color. The only other one I had just on margins for 2022, I mean, I think it's fair to assume some pretty modest expansion, I mean, given just what you just said on price cost. But would you say it's accurate? I know you don't want to get to the business that's guiding margins for the full year?

Yes. I'd say that – I think we're going to have another good margin year. Our, I think core operating margins will be up in that 30 to 40 basis point range. And I think core and reported incrementals will be in that 30% range. I mean in the – and in Q4, we had really healthy margins. Our core incrementals, our reported incrementals are 21%, but when you back out the acquisitions, we had healthy core incrementals of 32%. And I think that's going to continue into 2022. So I'm pretty bullish about the things that we're doing on cost management and improvement in the cost structure.

Great. Thanks for the color. I will pass it on.

Thank you.

Thank you. And our next question comes from the line of Scott Graham with Loop Capital Markets.

Hey, good morning Dave, Bill, Kevin, how are you?

Good morning.

Hey, Dave, would you mind giving us a split of organic orders by segment for the quarter?

Sure. I can do that. If you look at Q4, our organic orders for the total company were up 22%, and EIG orders were up 21% and EMG orders were up 23%. So really strong growth across both growth groups of the company and the book-to-bill was 1.07.

Right. And that's actually a perfect dovetail into my next question. Over the years, through acquisitions and just streamlining and investments, the EMG segment has really caught up a lot to the EIG in terms of our organic growth profile. So I'm wondering how does that work in what you're looking at in acquisitions. Is it more equal – and it's not going to be equally split because I know EIG is a lot larger segment than EMG. But I mean are you spending a lot of time in both segments on deals?

Absolutely, absolutely, Scott. I mean we'd love to put more M&A to our EMG segment, specifically in our automation businesses. We're just knocking it out of the park there, and we made some good acquisitions in the past years and couple that with some really good organic growth and an excellent engineering capability. In fact, we did a really small acquisition in 2021 to add some robotic capability to that business. But that's an area we also like our thermal management system business, commercial and defense business, but they're – we have a good leadership position, and we have some – we're looking hard there. So EMG is going to – EMG is getting looked at very hardly in terms of M&A, and their past performance has been fantastic.

That's great. Thank you. Just if I could squeeze this one last one in. It's an easy one. The research markets, as you know, hard to always study the trends in those markets from outside the four walls of AMETEK. How is research going for you? Are you being aided by sort of the reopenings? Are you – how are your investments working? That's a pretty important market for you. How is it – how's it going there?

Now research is about 10% of our sales in the process group and you're right, it's an important market for us. And what we saw mainly in the beginning of 2021 is the industrial research market was very good, but the universities took time to pick up because of the impacts of the pandemic. And what you're seeing right now is, I highlighted in my talk, the Gatan business, and that's more life sciences research and they're doing extremely well. And other parts of that business or the research market are picking up nicely. So it's not going to be as big of a growth driver because of the nature of the funding, but we're clearly transitioning from a more difficult funding environment during – and at the start of the pandemic to a better funding environment at this stage of the pandemic where I'd say all aspects of the research market are getting back to business.

Got it. Thank you.

Thank you, Scott.

Thank you. And our next question comes from the line of Rob Wertheimer with Melius Research.

Good morning, everybody.

Good morning, Rob.

So you managed through a really, really choppy 4Q better than many and admirably. And I guess the question is going to be on the short-term, how does it feel now versus then? I don't know what you can say on underlying indicators of Omicron, whether that's crested or not and whether you feel you've conquered some of the difficulties out there, whether it gets better or worse? And then I'll just put the other one in there now. Just on long-term runway, it seems like there's a ton of momentum in automation and semiconductors. Maybe that's evident in your backlog a little bit. I don't know how far out your visibility goes on projects and bidding and quoting and just what your feel for those end markets is throughout the year? Thank you.

Great questions, Rob, I mean, the first one is the Omicron variant. I believe we have a lot of statistics when you look at outside the world, and we also have our own internal statistics for AMETEK. And it looks like the peak infections are cresting. So I think the last two weeks, we were down a bit, and we had the highest level of infections prior to that. So it's clearly the same things that are happening outside of AMETEK are happening inside of AMETEK, but we're doing a pretty good job of managing through it. But it does cause absenteeism and it does cause labor availability and it's a challenge every day when something changes to manage through that. So that's clearly – that's part of the issue we're dealing with Q1. And our guide range is a little bit broader because of that. But our people are doing a fantastic job. When you talk about the long-term and runway and automation and semiconductors, we're seeing that. And if you think – I talked a little about the automation market and how we've done past acquisitions to acquire pieces of the automation, motion control, subassemblies that we've now put together, and we're very capable of quickly develop custom designs for our customers. We're kind of unique in that capability and we're winning a lot there. And I think that's going to continue. And when you look at the semiconductor market, really solid growth in Q4, but it's continuing. And we're competing in two parts of that market. We work in the research market. And I mentioned our CAMECA business did very well. That business is benefiting from the research side of semiconductors. And then you got some new technology that are going into the ramp in chip production. And some of the new technology uses something called EUV optics, and our Zygo business is an expert in that and there's only a couple of people in the world that are an expert in that. So, we're benefiting from the transition to EUV optics in the semiconductor industry, and that trend is just getting started. So, I'm not saying there's going to be some ups and downs as we go forward, but we're really well positioned in both automation and semiconductors as we look forward.

Thanks for the teaching there. Appreciate it. Thank you.

Thank you.

Thank you. And your next question comes from the line of Andrew Buscaglia with Berenberg.

Good morning, guys.

Hello Andrew.

Can you talk a little bit more broadly regionally? And specifically, I'm looking for maybe some context around China, just given – it seems like there's some increased risk there, maybe not direct risk but indirect impact from a number of things, supply chain risk and, yes, component shortages, et cetera.

Yes. Sure. I'll talk to that. The first point is I'll give a whole geographical look at our business first in Q4. It was a strong, broad-based growth across all geographies. In the U.S., we were up mid-teens and notable strength in our Automation businesses. In Europe, we were up mid-30s. So, we bounced back nicely there, and we had notable strength in both our Automation and Process businesses. And in Asia, we were up 4% and notable strength in Process and Automation there also. So broad-based firing on all cylinders. Your point is a good one. The reaction that COVID is handled differently in parts of the world. So, you can have, semiconductor plants are being shut down or blocking access to certain countries at times, and we've been managing through that at the start of the pandemic. But in particular, you asked about China, and we were up 2% in China, very solid because we had a really strong comparison, and we had a really strong year. So notable strength in Zygo, notable strength in process and China is strong for us, it has been strong all year and then put in a strong quarter. So as the outlook, we see for our types of businesses in our niche markets where we're competing solid pipeline of growth in China continuing.

Okay. Yes, that's helpful. And maybe one last one with commercial aerospace, that was strong, and I see that really strong growth exiting the year. I might have asked this question every other quarter for like the past two years. But what is kind of your sense with this demand building for like a reopening in the back half of the year? Is it kind of more of the same?

Yes, I think we're seeing some strength in our commercial businesses for sure. They were up low double digits in the quarter driven by aftermarket and business yet. But we're being cautious for the year because of the pandemic's impact on travel and different impacts in different parts of the world. And we think we're still going to have a good year. We're going to be up mid-single digits. And we're ready for that market to inflect upwards. It might happen in the second half of this year but it might be 2023 also. We're not sure.

Is that aftermarket typically a leading indicator for that – for you guys when that starts to pick up?

I think you see two things. I mean the aftermarket is a leading indicator, and the industry went through a hard shutdown and now it's recovering, and we're seeing good aftermarket. And business jets are a function of people deciding to travel differently.

Yes.

And good position in both of those and seeing strong demand.

Okay. Thank you.

Thank you.

Thank you. And our next question comes from the line of Nigel Coe with Wolfe Research.

Hey good morning, everybody. This is Brian on for Nigel.

Hey Brian.

So maybe just the growth investment, the $110 million. Any more color on where that's going, like within R&D and engineering, just any specific kind of initiatives or new products?

Yes. I'll start with the money first. We're putting about $40 million into increased R&D, and we're putting about $70 million into increased sales and marketing. And on the R&D side, it's across a wide range of platforms. We're not dependent on any one platform, and our business leaders put forth where they want to spend our incremental growth investments. So, it's spread out amongst good opportunities across our business. And in terms of the sales and marketing, we're doing a lot of work on e-commerce on digitization, and those are investments that will pay off very quickly, and they're already providing return for us because we sell to our customers different now through the pandemic, and we're expanding on our capability in that area.

Great. Thanks for that. And then when I think about the bridge into 2022, outside of kind of the price cost dynamics and this growth investment, is there anything else to be thinking about at the margin? And then also just kind of on a similar note, do you expect kind of normal seasonality to hold because some of your peers are kind of talking about a tale of two halves as far as depressed margins in the first half, but it just feels like you're navigating the supply chain better. So, you might not see that same dynamic. Thanks.

Yes. I think with our budget and increases sequentially each quarter, which is typical of an AMETEK budget, but we're seeing strong growth in Q1. So, your point is taken. When I look at our budget, just based on simple economics, we've guided to be up about 10%, and that's about $500 million. And if you apply a 30% to 35% contribution margin on that increase. You'll get a number that's in the range of the guidance that we gave you. Now in that number, there is a lot of new investments, there's cost savings, there's acquisitions that we did last year, there are some headwinds with below-the-line type things, taxes, shares, a little bit higher interest cost. But when you bake the cake and you put it all together, it's a pretty simple picture. Sales are up 10%. That's about $500 million, and we're going to get a 30% to 35% contribution margin on. So, it's pretty clear from that perspective.

Got it. Thanks.

Yes, thank you.

Thank you. And our next question comes from the line of Joe Giordano with Cowen.

Hey, good morning, guys.

Good morning, Joe.

Yes. Apologies if I ask questions that have already been asked or answered. It's been a bit of a busy one this morning. But on the order side, I mean, obviously, really strong and it has been so, like what's your view on book-to-bill as the year progresses? And I know you are less susceptible to this than others. But like how the early ordering – kind of like what are you seeing? Is there any kind of like inventory at customers or like ordering so far in advance that it could set up like a vacuum at some point? Like how are you kind of thinking about your customer order patterns here?

Yes. I mean we have customized products.

Yes.

So, I don't think that people are investing in – we're not going to run into a distributor problem or things like that. But at the same time, we've talked about our customers being aware of the supply chain issues and giving us increased visibility and placing orders on us to go out to the future. So, we're seeing that in our backlog. And at some point, that may roll over. But right now, it looks very strong. We mentioned in the prior remarks before you got on our organic orders were up 26%, and it was both strong in EIG and EMG. EIG orders organically were up, similar spread across the businesses. So, we are – I think the month of January was strong, and it supports our guide. But the order rates have not changed into January. Anything else?

Okay interesting. Maybe, and again, you might have answered this, but did you give the core incremental ex like M&A dilution for EIG in 4Q?

Yes. We did talk about the – it was 32% core for the whole company, and it was reported 2021. So, we really had a good performance core. And you had...

It was up 50 basis points margins ex acquisitions in EIG.

Yes, yes. It was up 50 basis points ex acquisitions…

Is that…

[Indiscernible] business was up two sixty or two thirty, so it was good. So, the margins across the board were good for the company. And you look at EIG, you look at EMG, there are some acquisitions that depress EIGs but the incrementals were 32% for the whole company. The EIG core incrementals were 33% and the EMG core incrementals were 38%. So, the reported incrementals for EIG were a little bit lower because of the acquisitions, but really strong core incremental margins across the company.

Very good. Thanks guys.

Yes. Thank you.

Thank you. And our next question comes from the line of Rob Mason with Baird.

Yes, good morning guys. Thanks for taking the question.

Good morning, Rob.

Just maybe to stick on the topic around acquisitions. I'm just curious what the acquisition – I could probably do this math at some point. But just what did the acquisitions contribute to earnings in 2021? And what's the component in the bridge in 2022 in terms of EPS?

I believe it was 16% in the bridge for EPS for 2022. And I believe it was about the same for 2021. But that $0.16 is included in the economics of the budgets that I talked about just a few minutes ago.

Sure, sure. And Dave, I mean, you noted it was a very busy year for you…

Rob, Kevin just told me, I said $0.16. It's actually $0.18. So, its $0.18 in 2022 and it happened to be $0.18 in 2021. So it's $0.18 for both of them.

Okay, understand. You had, as you mentioned, a very busy year on the acquisition front. And I'm just curious, integration-wise with all the challenges around supply chain. Has that helped or hurt you in terms of your ability to integrate that? Has it forced you to move a little bit faster on the supply chain front?

Yes. I think it's forced us to move faster and getting the AMETEK culture installed and getting the AMETEK processes installed. So, the differences are obvious, and we're working with the teams, and the integration of AMETEK is going very well. And it's early in the ownership, and we usually take it slower, but the environment made us go faster and they're integrating nicely into the company. And the benefits of our distributed operating models, we can take on a bunch of deals like that and be able to integrate them all. And they are fantastic businesses. I mean they each fit perfectly with our acquisition strategy. They are leaders in niche markets. Each have strong differentiated technology positions and they are expanding our presence in attractive markets. So, the acquisitions are going very well. And myself, and Bill and the group presidents have been spending a lot of time on them.

Yes, yes. And just one last one, just to follow on there. Abaco was your largest one, largest one ever, I think. And I noticed a nine-digit order recently. Within a business like that, what does an order like that or win, I should say, what would that shift – over what time frame would something like that shift?

It can be years. It really could be years. And specifically with Abaco, I mean, that team there is really talented, and were into the high 90% of the integration, and it's a high-quality management team. In terms of the org structure, we've combined it with our AMETEK Aerospace PDS business unit. So, when we looked at this business, we think there's a lot of synergies. So, we formed one division, and we now have a seasoned AMETEK P&L leader running the division along with the seasoned AMETEK CFO and along with a seasoned AMETEK HR person. So, we've installed some people there to help them – Abaco understand the AMETEK Ultera – at the same time, we're learning a lot from Abaco also because they have a lot of talent. So, I think this combination over the long run is going to be good for both businesses, and it's going to drive sales and cost synergy for both the AMETEK PDS business and Abaco.

Excellent. Excellent, I’ll pass it back. Thank you.

Thank you, Rob.

Thank you. I'm showing no further questions. I will now turn the call back over to Vice President of Investor Relations and Treasurer, Kevin Coleman, for any closing remarks.

Thank you again, Andrew. And thank you, everyone, for joining our call today. And as a reminder, a replay of today's webcast may be accessed in the Investors section of ametek.com. Have a great day.

This concludes today's conference call. Thank you for participating, and you may now disconnect.