Good day, ladies and gentlemen, and welcome to the Second Quarter 2016 Carpenter Technology Earnings Conference Call. At this time, all participants are in listen-only mode. Later we will conduct a question-and-answer session. And I would now like to turn the call over to Brad Edwards, Investor relations.

Thank you, operator. Good morning, everyone, and welcome to Carpenter's earnings conference call for the second quarter ended December 31, 2015. This call is also being broadcast over the Internet along with presentation slides. Please note, for those of you listening by phone, you may experience a time delay in slide movement. Speakers on the call today are Tony Thene, President and Chief Executive Officer; and Damon Audia, Senior Vice President and Chief Financial Officer. Statements made by management during this earnings presentation that are forward-looking statements are based on current expectations. Risk factors that could cause actual results to differ materially from those forward-looking statements can be found in Carpenter's most recent SEC filings, including the company's June 30, 2015 10-K, Form 10-Q for the quarter ended September 30, 2015, and the exhibits attached to that filing. Please also note that in the following discussion, unless otherwise noted, when management discusses sales or revenue, that reference excludes surcharge. When discussing operating income, that reference excludes pension, earnings, interest and deferrals or EID. When referring to operating margin, that is based on sales excluding surcharges and operating income excluding pension EID. I will now turn the call over to Tony. Tony R. Thene - President, Chief Executive Officer & Director: Thank you, Brad, and good morning to everyone on the call. Let's begin on slide four with an update on our safety results. For the second quarter of fiscal 2016, our Total Case Incident Rate, or TCIR, was 1.9. This is good improvement from a disappointing first quarter fiscal 2016 of 2.3 TCIR. Year-to-date fiscal 2016, we stand at a 2.1 TCIR. We continue to put safety first and we're working hard to reduce this rate by placing emphasis on employee engagement and human performance factors. During the first half…

Our first question comes from Gautam Khanna from Cowen and Company. Bill Ledley - Cowen & Co. LLC: Yes. Thank you. This is Bill Ledley on for Gautam as he is at our Aerospace Conference today. I had a question on the comment of H2 sequential growth. Normally you guys have a seasonal pickup in H2. However, you guys are only guiding modestly. Just wondering if you could comment on that and if that is meant to imply that the EPS won't rise much on a sequential basis and then I have a follow-up? Tony R. Thene - President, Chief Executive Officer & Director: Yeah. Usually if you look at first half versus second half, we're probably in that range of 45%, 46% in the first half to 54%, 55% in the second half. I don't think you'll see a much different, maybe 2 or 3 percentage points different and it's going to be primarily driven by oil and gas on the Industrial side. Bill Ledley - Cowen & Co. LLC: Okay. Thanks. And then on the share repurchase, do you think you will complete the full authorization by the time it expires just on the comment that they can be discontinued? And then also on the various aero end markets, can you just talk about fastener demand and how long you think it takes for the supply chain adjustments to finish up? Thank you very much. Tony R. Thene - President, Chief Executive Officer & Director: Okay. Thank you. I'll take the second part of the question, and then I'll -- the share repurchase, I'll give it to Damon. We believe as I've heard several others say that on the titanium fastener demand that that is a supply chain adjustment that's cycling its way through. We've seen that over the last couple of quarters. As I've mentioned, we did see a pickup in orders in January. Now, that's fairly early, but we see ourselves coming out of that right now. Damon J. Audia - Chief Financial Officer & Senior Vice President: And in regard to the share repurchase program, as we've said, it's up to $500 million. I think through December we have done $221 million, so just a little bit less than half. We will be prudent depending on the outlook for the second half of the year here as you heard us talk about our outlook for the volumes. So, we will continue to be opportunistic. We have said it's not linear, so again, we may be in the market, but to the extent, we're not committing to doing the full $500 million anything beyond what we've done here through the end of the second quarter. Bill Ledley - Cowen & Co. LLC: Okay, great. Thanks so much. I'll jump back in.

Next question comes from Phil Gibbs from KeyBanc Capital Markets.

Morning. Tony R. Thene - President, Chief Executive Officer & Director: Good morning, Phil. Damon J. Audia - Chief Financial Officer & Senior Vice President: Good morning.

Hey, Tony, I just had a question on the guidance for the second half pointing to modest improvement. Typically you have a nice pickup in 3Q if anything for seasonality and I wouldn't think ex-seasonality the outlook for Energy here, given the fact that it has already been down in some of the Industrial applications, probably should have changed all that much. So, is there anything really from a seasonality perspective that's weaker than normal than what you're seeing? And any color you could provide us on your Aerospace backlog and your visibility there into the second half? Tony R. Thene - President, Chief Executive Officer & Director: It really isn't a seasonality issue for us, Phil, and it is driven by oil and gas. If you look at first half versus second half, we still see some improvements in Transportation. We still see a consistent and strong flow for Aerospace, but we are seeing, especially in our SAO business, some further deterioration in the oil and gas as evidenced by some of the announcements that you've seen here in the news lately. In terms of the backlog, if you look year-over-year, I would say it is probably from a tons basis about down 25%, 30% and it is predominantly driven by oil and gas and Industrial, and that Industrial piece is what's directly connected with the Energy markets.

Okay. That's helpful. And on the CapEx piece, is there any deferral in spending that you're doing there for some of your powder projects because maintenance CapEx is basically that $100 million level, anything from a growth project timing standpoint that's pushed out of it or have you been able to reduce the maintenance level of spend? Tony R. Thene - President, Chief Executive Officer & Director: Yeah. I would say roughly that if we moved down to $100 million, you're looking at somewhere around 70%, 75% of that is on a sustaining level. So we're trying to be as efficient as possible there, not making any inappropriate decisions that would hurt us long term. We're not pushing out any spending on the powder projects, but there are some other projects as we look at our volumes that we adjust and that's how we are able to pull the guidance down from the $120 million to roughly $100 million.

Okay. And then lastly here on the Aerospace qualification process at Athens, can you elaborate on that a little bit in terms of what steps that we need to see? What we're looking for in terms of milestones and when we should expect some of the volume to come off that facility and be in the commercial spectrum just in terms of what we should be looking for here? Thanks. Tony R. Thene - President, Chief Executive Officer & Director: All right. Yeah, Phil, thank you. We're running all those products in areas that I mentioned just recently. We're running those through Athens today, now albeit the market is depressed, especially on the Energy side. On the Aerospace side and the VAP, obviously, that's the most important from a volume standpoint and we've been very consistent. Even I think the first time we started mentioning targets for VAP Aerospace qualifications was back in December of calendar year 2014 and we've always said that that would come by the end of calendar year 2017. The team is working hard at that. We're focused really now on validating our internal process and achieving those technical targets. And once we can do that, we think we are very close now then we will continue to share data with the OEMs and move the process along.

We'll move on to our next question coming from Andrew Lane from Morningstar.

Hi. Good morning. Tony R. Thene - President, Chief Executive Officer & Director: Hello, Andrew. How are you?

Very well. Thanks. Could you comment on what the product mix of your Aerospace and Defense backlog looks like? Is it pretty consistent with the volume mix delivered this quarter or has it evolved? Tony R. Thene - President, Chief Executive Officer & Director: I would say that going forward, as we look at our backlog, it's pretty similar. I mean, there are some changes, obviously, and we had, in certain sub-segments, a bit richer mix than we've had in the past and you might see that evidenced in the backlog, but I wouldn't say that you've seen significant shifts there.

Okay, great. And then could you provide some additional color as to your timeline for the construction of the new titanium powder operation and then when will the majority of the associated CapEx be spent? Tony R. Thene - President, Chief Executive Officer & Director: We'll spend the majority of that CapEx in fiscal year 2017. We won't spend a whole lot of it quite frankly this year, we're going through the engineering studies now and doing the request for bids for the equipment. So you'll see the majority of that next fiscal year. And then as you look towards the end of fiscal year 2017, early 2018 is when we bring that online.

Okay. Thank you very much.

Next question comes from Steve Levenson from Stifel. Stephen E. Levenson - Stifel, Nicolaus & Co., Inc.: Thank you. Good morning, everybody. Tony R. Thene - President, Chief Executive Officer & Director: Good morning, Steve. Damon J. Audia - Chief Financial Officer & Senior Vice President: Good morning. Stephen E. Levenson - Stifel, Nicolaus & Co., Inc.: With Boeing and Airbus both announcing additional rate increases for single-aisle planes going into 2019, can you comment on your current spending on the powder capacity? Will that be sufficient for everything you need then or do you think you have to plan now for some additional spending? Tony R. Thene - President, Chief Executive Officer & Director: Well, it's early days right now. I don't think so on the powder side, right, which we have to, obviously, go through the qualifications on that. But I don't see – I think we'll wait to get this one up and running before we start looking at the next tranche. We do have the ability there to add on incremental capacity, if needed. Stephen E. Levenson - Stifel, Nicolaus & Co., Inc.: Okey doke. Thanks. And then in terms of figures for a reversal in the PEP volumes, is there a particular oil price or demand figure you are looking for? Is there something you can tell us about what to watch for and do you think that your reversal will lead or lag improvement in the Energy markets? Tony R. Thene - President, Chief Executive Officer & Director: Right. I think whenever the recovery comes that it's going to be a very abrupt recovery, right, and that's why we're trying to maintain our relationships not only with our customers but in those locations, right, and make sure we have a presence there. Because, as I say, when the recovery comes, we think it will be quick. I don't know if there is a certain oil price that's going to require that type of uptick. As you talk to the service providers now, calendar year 2016, at best, capital spending is going to be flat, if not down slightly. So I think you're probably looking at 2017 to see any type of improvement. Stephen E. Levenson - Stifel, Nicolaus & Co., Inc.: Got it. Thank you very much.

Next question comes from Chris Olin from Rosenblatt Securities.

Hi. Thanks. Could you help us with modeling the positive or the potential upside for Aerospace, maybe what jets or engine programs you have greater leverage to, have you ever kind of looked at a revenue content per aircraft type of number that you would be willing to share? Tony R. Thene - President, Chief Executive Officer & Director: Well, I would say this that we have content on all of the new platforms. The content for us on all of those is greater than it is today. So as we see the new engine platforms come online, we'll see greater content and an increased revenue.

Does it matter between Airbus or Boeing in terms of overall build rates? Tony R. Thene - President, Chief Executive Officer & Director: I hate to call that out. I mean, we have – I'll say this, we have content on all of them. Obviously, there's some differences there, but we have strong relationships with both of those manufacturers.

Okay. Just lastly to – anything change on the aftermarket for engine or some of the Aerospace programs, have you seen that pickup at all? Tony R. Thene - President, Chief Executive Officer & Director: We've not really seen a change, Chris. I think maybe you'd asked that question last quarter or somebody did. And we haven't seen any real drastic changes there quarter-over-quarter.

Okay. Thanks.

Next question comes from Gautam Khanna from Cowen and Company. Bill Ledley - Cowen & Co. LLC: Yes. Thanks. Just had a couple of follow-ups. One, you mentioned that you have reached the $30 million in run rate saving, I was just wondering if you had plans for more restructuring and where those savings can go? And then also on the Energy revenue, is the $24 million in the quarter sort of a bottom, or is it possible to get sequentially worse in Q3 and kind of continue on at that level? Thanks. Tony R. Thene - President, Chief Executive Officer & Director: On the restructuring standpoint, I believe we were very successful there. I think we were out in front of the downturn and that's been a big benefit for us. I don't have a program that we are working currently on, but we are certainly – we certainly review that from time to time. And if that's something we have to do based on the markets, we will do that. In terms of Energy, as we look to the third quarter, I think, as we said, we believe it could be slightly lower and hoping that that's the bottom then. Bill Ledley - Cowen & Co. LLC: Thank you very much. Tony R. Thene - President, Chief Executive Officer & Director: Thanks.

I would now like to turn the call back over to Brad Edwards for closing remarks.

Thank you, operator. Thanks, everyone, for joining the conference call today. Have a great day.