Good day, ladies and gentlemen, and welcome to the Colfax Fourth Quarter Earnings Call. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session and instructions will follow at that time. I would now like to turn the conference over to you, Terry Ross, Vice President of Investor Relations. You may begin.

Thank you, Sonia. Good morning, everyone, and thank you for joining us. My name is Terry Ross, and I am Colfax's Vice President of Investor Relations. With me on the call today are Matt Trerotola, President and CEO; and Scott Brannan, our Chief Financial Officer. Our earnings release was issued this morning and is available in the Investors section of our website, colfaxcorp.com. We will also be using a slide presentation to supplement today's call, which can also be found on the Investors section of the Colfax website. Both the audio of this call and the slide presentation will be archived on the website later today and will be available until the next quarterly call. During this call, we'll be making some forward-looking statements about our beliefs and estimates regarding future events and results. These forward-looking statements are subject to risks and uncertainties, including those set forth in our SEC filings. Actual results might differ materially from any forward-looking statements that we might make today. The forward-looking statements speak only as of today, and we do not assume any obligation or intent to update them except as required by law. With respect to any non-GAAP financial measures during the call today, the accompanying information required by SEC Regulation G relating to those measures can be found in our earnings press release and supplemental slide presentation under the Investors section of the Colfax website. Now I'd like to turn it over to Matt.

Good morning, and thank you for joining us today. Our fourth quarter operating results were consistent with the expectations we described on our last call, including revenue and adjusted operating profit in line with previous guidance. Adjusted EPS was well above guidance due to tax and interest tailwinds. Net sales for the quarter were $1.061 billion. The organic revenue decline of 3.8% reflects what we believe to be solid competitive performance in a continuing weak end market environment. I will discuss this in more detail as we look at each business segment. On the last call, I announced additional cost reduction efforts to eliminate $100 million from our 2014 cost base by the end of 2016. I am pleased to announce good progress on these actions through the quarter, which will allow us to recognize $50 million of incremental cost savings this year. Towards this objective, we made good on our Fab Tech consolidation in North America. We completed the integration of customer service and transitioned over half of the production volume, while improving overall customer service levels. We also implemented a simplified business unit structure at Howden, improving market and customer focus while reducing administration costs. Collectively, these cost actions are aimed at increasing our operating margin in 2016, despite what we expect to be continued markets headwinds. Turning to the Gas and Fluid Handling segment. Orders for the fourth quarter were $443 million, flat with third quarter levels. Although down 19% organically from previous year, this order volume was only slightly below expectations and reflects the timing of some large project orders in Q4 of 2014. For power generation, our largest end market, revenues for the quarter decreased by 18% organically, while orders decreased 10% organically. The fourth quarter is the final quarter of the revenue comparison to…

Thanks, Matt. This morning we reported our fourth quarter results. Adjusted EPS was $0.51 per share, which exceeded our expectations for the quarter due to the favorable below the line savings in interest, non-controlling interest and income taxes, which I will discuss in a moment. The fourth quarter did not have any large unforeseen operating expenses or benefits. Net sales were $1.061 billion, a decrease of 12% from the same period last year. This consists of a 3.8% organic decline, a negative 10% impact from foreign exchange, partially offset by 2% growth from the Roots acquisition. The end markets remain weak, but trends support the revenue guidance we provided in December. Adjusted operating income was $101 million. Adjusted operating margin was 9.5% down from 11.3% in the prior year. Excluded from adjusted results are $36 million of restructuring costs incurred in connection with the previously announced cost reduction projects. Gas and Fluid Handling net sales for the fourth quarter were $573 million, a 3% organic revenue decline, a 9% negative foreign currency exchange impact, and a 4% increase from the Roots acquisition. Adjusted operating margin for this segment was 11.8% reflecting the seasonally higher volumes in the fourth quarter. These results were 190 basis points below the prior year on lower volume and $3 million of year one fair value purchasing accounting from the Roots and Simsmart acquisitions which were partially offset by cost reductions. Most of the purchase accounting and fair value expenses for Roots are now complete and the remaining amount for Simsmart is not significant. Restructuring expenses of $36 million were much higher in the fourth quarter as we implemented the previously announced cost reduction efforts. In addition to the organization structure changes mentioned by Matt, we made progress on several fronts including the closure of facilities…

Thanks, Scott. We delivered against our fourth quarter commitments despite ongoing market headwinds. I'm encouraged by the pace of our operational improvement at ESAB and the execution of our cost reduction actions across the company. Our view of 2016 remains the same as we shared in December, and we are prepared to deliver strong performance in a tough growth environment. We continue to advance our acquisition cultivation efforts. But with current market conditions, we're also deploying capital to attractive stock repurchases. We've bought back roughly 2 million shares since the inception of the authorization, and we'll continue to determine the best capital allocation choices as we move through the year. With that, I'd like to open up the session for Q&A. Sonia?

Thank you. And our first question comes from Andrew Obin of Bank of America Merrill Lynch. Your line is now open.

Good morning, guys. Congratulations.

Thank you.

Thank you.

Just a question on fabrication, you're sort of taking a closer look at the business. It seems you're still trying to figure out what's going on. What are the sort of benchmarks or what are the road posts we should look at for the next quarter or two to get a sense that things are stabilizing, that the new product introductions are working, that the new strategy is working, can you just give us some color what should we expect the next couple of quarters?

Yeah, I think we've – our focus areas in that business that we've talked about, our primary focus area there is around making sure that our costs are realigned for the revenue environment and the growth environment of the industry. And so, in the next few quarters, you should continue to see good progress on our costs and our margins related to that. And then we continue to work hard on the growth fronts to – we continue to drive strong growth around the world as well as in the U.S. in terms of the initiatives we're driving and we continue every quarter to take a hard look at our performance versus our peers in the industry. And we feel like in the back half of last year, we saw some stabilization there in North America in particular. And in the next few quarters, we'd expect you to continue to see stabilized growth performance in that business.

And just a question on macro, follow-up, a couple of industrial companies are indicating that maybe we're starting to see the bottom of North American destocking cycle. You've commented what you've been seeing towards the year end, but any color on what you're seeing in January and do you think North American industrial activity is getting better in any way, shape or form? Thank you.

I think what we've seen in January is consistent with the guidance that we gave late last year, and we haven't seen any significant movement one way or the other on destocking.

Thank you very much.

Thank you. And our next question comes from Jeff Hammond of KeyBanc Capital Markets. Your line is now open.

Hey. Good morning, guys.

Good morning.

Hey, so just on Gas and Fluid, overall, I think you're still looking for down 2% to 5%. It sounds like industrial is may be coming in a little bit weaker. Can you may be frame with a little more detail how you're thinking about the growth rates within Gas and Fluid by vertical? And it sounds like power gen is going to grow a little bit. How ugly can oil and gas be, maybe a little more color?

Sure, Jeff. I think we are positive on power given the backlog as we go into the year there as well as the activity in the pipeline. We're also positive on marine. Marine is obviously much smaller, but we've seen some momentum there and now we see a good pipeline of activity in that segment as well. On oil and gas, I think we're a little more modest. We had a very strong order intake in the fourth quarter of 2014 as well as early this year. You're seeing that in our revenue numbers now. We have more – we have a less of a backlog in going into 2016 so our expectation is a little more modest there. On industrial, as Matt said, it's extremely lumpy. We had a close to flat quarter order wise in the quarter. We had a large negative here in the fourth quarter. I wouldn't encourage people to look at that market over a broader period of time than a single quarter. All that being said, the trends are still sort of double-digit down over time. That is factored in into our guidance. The reason we remain comfortable with our overall revenue target is the activity in the aftermarket sector. We do expect modest growth in the aftermarket sector, which combined with the rollout of the large project backlog, does give us confidence to reaffirm our revenue guidance.

Okay, great. And then just back on the welding business, I think you mentioned Europe and South America coming in a little bit better and some signs of stabilization. What are you seeing there specifically that points to that stabilization? Is that outperformance or is that markets maybe, markets helping out a little bit more?

Well, we've seen the markets improve some, and we believe that we're at least holding our own in those markets and we may be gaining some share in the back half of the year in those markets, but the data is not fully available yet.

Okay, thanks.

And our next questions come from Eli Lustgarten of Longbow Research. Your line is now open.

Thank you. Good morning, everyone.

Good morning.

Can we talk a little about how you see 2016 roll out really on a quarterly cadence with the weakness in order backlog in fluid and I guess the softness that we're seeing in the welding business? We sort of expected maybe we have some weaker first quarter first half to look forward to maybe with some stabilization from your second half as the restructuring takes hold. Can you give some maybe some color on what we can expect quarterly to reach the targets given the order patterns look so soft?

I think what I would refer you to Eli is the comment, and there is a specific slide in the deck as well from the Investor Conference, where I did lay out revenue expectations by quarter. We are reaffirming that as well as the overall guidance, and your intro was spot on. That does show a weaker of our first half followed by a bit stronger second half, which again is the impact of rolling out our backlog as well as the fact that our capital goods business, particularly in Gas and Fluid Handling, is seasonally stronger in the fourth quarter. So I would refer you to the slides.

Yeah, I realize that was there. I'm just wondering whether the results that we saw in the order pattern has modified that at all or has changed if the first quarter might be a little bit weaker than weaker than... ?

No, it's not. No, it's not.

...we just like that or are you still within the range or maybe toward the bottom end of the range is what you're seeing?

I think we're still within the range. There's certainly pluses and minuses. We feel comfortable with the range.

And then one note, the tax rate with the benefit, what's the ongoing – did tax rate change at all for 2016?

Yes, the tax rate should be about 1% lower than the guidance range that we gave because the – for those tax techies out there, the active finance exception for Subpart F has been extended for a five-year period, which means we can reflect that in the normal quarterly tax rate as supposed to having to catch it all up when Congress passes it in December. So, yes, our tax rate guidance will be down about 1% from what was in the December presentation.

Yeah. And just one question on welding. The rollout of new products, I mean I understand it's been received in the marketplace. We have heard a lot of issues about availability and you probably won't have much until middle of February before that. Are things rolling out availability as you expected or has it been pushed out or can you give us some color on the new products, particularly the Rebel?

Yeah. Well, there's been a tremendous reception to Rebel, both in terms of the response to the marketplace, the response to the distributors. And so we've had quite strong demand for the product. We had started taking orders at the FABTECH Show for January and February initial deliveries. We've already starting shipping the product and, yeah, given what a great product it is, there's a lot of demand to get it as fast as possible. But our ramp has actually accelerated versus the initial ramp that we had planned from a production standpoint.

All right. Thank you very much.

Our next question comes from Matt McConnell of RBC Capital Markets. Your line is now open.

Thank you. Good morning. Given the continued buybacks and I wonder if you can just comment on your leverage appetite right now, just given the state of end markets and financial markets as well. What's the kind of comfort level on a net debt-to-EBITDA basis?

I think we're, as I said in my prepared remarks, we are committed to a prudent and improving capital structure. So I certainly think on a net debt-to-EBITDA basis, we're talking of something less than 3%. So, to Matt's point, we will be making use of our free cash flow and we will carefully choose between M&A opportunities and share buyback. But we're not looking to increase our leverage beyond that type of level.

Okay. Okay, great. And just maybe an update on the M&A pipeline, how do potential sellers respond to increased volatility in the end markets? Did that help some potential M&A targets break free or did people pull back or just any update on what you're seeing on the M&A pipeline?

Yeah, I would say broadly there's still disconnect between the prices that sellers are ready and willing to sell for and the prices that buyers are – as you get anytime that you get this kind of a more dynamic market situation. That said, there are some good specific opportunities out there, and we're engaged on some. And I think if there are good specific opportunities, we'll certainly be pursuing them.

Okay, great. Thank you.

Thank you. And our next question comes from Nathan Jones of Stifel. Your line is now open. Nathan Jones - Stifel, Nicolaus & Co., Inc.: Good morning, Matt, Scott, Terry.

Good morning.

Good morning. Nathan Jones - Stifel, Nicolaus & Co., Inc.: Matt, if I could, just focusing on a comment you made in your prepared remarks. You said solid competitive performance in tough markets. And I think that implies that you're implying that you gained some share in the quarter. I wonder if you could just give us some color on maybe where and how much you think you gained in the quarter?

Yeah. Well, I think we've been consistent that we think in the Howden business, we've been gaining share in oil and gas and also in some parts of our fans business for example in China. So we think we continue to have strong share performance in the Howden business. I commented on some of the specific progress in the Korean shipyards with – in Fluid Handling, where this is more on a specific project basis, but we're encouraged by some momentum there. And I really think in the Fab Tech business what we saw was improvement in our growth rate throughout the year in a market that was worsening throughout the year. And we think that, that indicates progress in the right direction and each quarter has its own kind of unique puts and takes. But we feel like we're making progress in the right direction. Nathan Jones - Stifel, Nicolaus & Co., Inc.: Okay. And another comment you made on South America with signs of stabilization in that market, I think the macro indicators would probably run counter to that. Can you give us a little bit more color on how you get confident that, that market is at least approaching a bottom?

Yeah. I was down there a few months ago and a handful of country. And I would say in each of these countries, I saw and heard a very credible combination of political and economic combination of facts that pointed to, in countries, improvement this year, and in some countries, improvements later this year and on into next year. And then certainly our – what we've seen in terms of orders and growth performance down the back half of last year and into the beginning of this year is consistent with that stabilizing view of that market. There are still certainly country-by-country specific challenges, be it political or currency or inflation. But we have seen stabilizing demand and we think that this year into next year that that's going to be an improving area for us. Nathan Jones - Stifel, Nicolaus & Co., Inc.: Okay. And if I could just get one more and on project margins, you said despite pricing pressure, the execution maybe actually increased this year. Could you talk about your expectation for project margins in 2016 and how pricing and backlog going into 2016 is different to what it was maybe going into 2015?

Yeah. I'd say, first, we don't anticipate a change in the pricing environment from 2015 into 2016. Obviously, some of these markets are tough. And on the projects that can be competed for by a number of suppliers, there can be some price pressure. But at the same time, many of our projects are, really are based on the total cost of ownership and value to the customer. We're partnering with customers on the engineering of those projects. We got our sales forces trained in value selling to help customers to understand the value of these projects. And so we think in 2016 like 2015, there'll be some pressure out there, but we'll also be able to continue to make solid progress on value selling our projects. At the same time, we will continue to work on the cost side of the equation aggressively as we did in 2015 to ensure that our project margins move in the right direction.

And the backlog per se, the margin and the backlog is consistent with historical levels. There's no decrease in profitability in the backlog. Nathan Jones - Stifel, Nicolaus & Co., Inc.: That's helpful. Thanks, guys.

Thank you. And our next question comes from Brian Konigsberg of Vertical Research Partners. Your line is now open.

Yes. Hi, good morning.

Good morning.

Matt, maybe you could talk a little bit more just on the oil and gas opportunities that go into 2016. I know you talked about a bit at the Analyst Day, but I don't know if there's some additional detail you could provide by, what's looking potentially attractive to enter that could offset some of the kind of the core business that's clearly under pressure from an order standpoint?

Yeah. So, as we've said, we continue to see particularly the upstream parts to be difficult in 2016 and down from a capital spending standpoint. But on more the downstream parts and particularly the aftermarket into the downstream parts, we've aligned more of our organization to pursue that and we're going to be driving as much business as we can in those areas. There has been a number of deferrals and delays of turnarounds down the back half of last year. And we think at some point, those turnarounds need to happen and we're going to be there ready to serve those. And in as far as the entire oil and gas environment and new projects, we're focusing our energy on the specific areas where people will make investments. For example things that might be more efficient ways to be extracting oil for this lower price environment.

Are we talking about new products in the market or using existing products just for new applications to expand your market opportunity, I guess that's more what I was getting to?

We pretty much have application-based adaptations to our products are really the opportunities there.

Okay, got it. And just going back to Rebel in FABTECH, does that – what kind of impact does that have on mix into 2016? How does that compare from a margin standpoint relative to the rest of the portfolio, does that help you into 2016 and is it meaningful, can it move the needle?

Yeah, well I'd say a couple things there. The first is that equipment margins are stronger than consumer margins broadly in the welding business. And so increasing our equipment share and the share of our businesses in equipment would be positive from a mix standpoint, that's the first thing I'd say there. The second is that Rebel will be extremely positive to our brand and our progress in the market and our ability to have stronger and stronger progress with the channel in North America but it'll take some time for the financial impact of it to be something that will read through in our results even if we sell beyond the upper end of our expectations of how that product could penetrate.

Understood. If I could get just one last quick one in, just on China and with the increase in SCR orders, is the margin profile of this next wave of I guess potential orders, how does that compare to the last cycle, has that changed at all, has it become more competitive since the previous initiative?

We don't expect a change in the margin profile and the early projects that we've been involved in there are not indicating that there'll be a change in the margin profile.

Understood. Great, thank you.

Thank you. And our next question comes from Andrew Kaplowitz of Citi Group. Your line is now open.

Good morning guys. I just wanted to follow-up on your previous comments on the aftermarket. I think at the Analyst Day you said you think you could drive high single-digit aftermarket growth in your businesses in 2016, how do you feel about that now? I know you said you'd drive some growth here in 2016 on the call, have you seen anymore deferrals from customers, do you expect them in your aftermarket business?

So far in – one month does not a trend make but so far we had a very positive month in the month of January relative to hitting our targets in aftermarket. We do expect the aftermarket to be up for the year but because of the focus and resources we've applied to it, our guidance doesn't require it to be up single-digit, that's certainly our goal. But we don't see any reason that there's no market conditions indicating that we won't be able to execute our plans here.

Okay that's helpful and then just going back to FABTECH for a second 4Q margin 9.1% it was better than 3Q. But as you guys know 3Q included headwind from charges which is modestly better than 3Q. So can you talk about execution in the quarter? You said execution will continue to improve, was there anything in the quarter unusual and how should we look at it as we go forward into 2016?

Yeah I mean I'd say we made good solid progress accelerated progress in the quarter. I would say we're advanced in our cost reduction efforts in line with expectations that we had, continued strong recovery on our operational performance in terms of our on-time delivery and shipments to customers. And so we feel like we made strong progress and that we will continue to make that strong progress into Q1 and Q2.

And I highlighted a few items in my comments as to areas where the spending was a little bit higher including the product launch costs and the continued mix towards a lower equipment mix.

So the launch costs do go down though as you go throughout 2016 now, right?

Correct.

Okay. Thanks guys.

Thank you. And our next question comes from Joe Ritchie of Goldman Sachs. Your line is now open. Evelyn Chow - Goldman Sachs & Co.: Good morning, Matt, Scott and Terry. This is actually Evelyn Chow on for Joe. Just following up on Andrew's question but maybe with an eye towards the longer term. Previously you said that a recovery in the markets may not be in the cards before 2017 and clearly other industrial companies maybe not direct peers to you have been talking about positive order inflection by the April quarter. I think in your remarks you noted that the second half of 2015 saw more board based weakness in general industrial beyond steel and cement. So just wondering what you're watching here that would change your outlook?

Well I think, based on the cycles of our business, we'd need to see a positive orders more in the second half of the year in order to be returning to growth next year in our Gas and Fluid Handling business. So in the first half of the year, we'll be watching the orders but we'll be particularly watching the funnels as well as those advance indicators of what's possible in the second half of the year. And we will also be definitely watching the aftermarket trends both in terms of the market opportunities and our progress as we get significant amount of initiatives aimed at the aftermarkets. A lot of the organization realignment we've done has increased our focus in those businesses on the aftermarket, and so we'll definitely be watching those markets as well as our progress on those initiatives. Evelyn Chow - Goldman Sachs & Co.: It makes sense. I guess maybe switching gears. It seems like you're making good progress in the cost-out. As you've been working through your plans have you found maybe the ability to identify more actions within the same envelope of spend or maybe found the ability to accelerate those actions?

Yeah. We are constantly trying to accelerate the actions as much as possible. And I think it's always good management to be always looking for the next opportunities that might come after the current ones. Evelyn Chow - Goldman Sachs & Co.: Okay. Thank you very much.

Our next question comes from Walter Liptak at Seaport Global Securities. Your line is now open.

Hi, thanks good morning. I wanted to ask about the guidance which is, it sounds like largely unchanged, and just what your thinking is with crude prices down so much over the last six weeks, how you factored that in? Because it seems like a lot of the majors and independents are cutting CapEx. And what you're thinking about and how impacts your outlook?

Yeah, we shared at our Investor Day our outlook for oil and gas, which was another pretty significant step down in CapEx spending, particularly in the upstream parts of oil and gas and that was factored into our guidance from December. And we don't see any of the changes in price of oil that have happened recently to have any different impact on that.

Okay, fair enough. All right, if it does change, is there more cost that you can take out in those oil and gas facing businesses?

So, if the market environment changes, for sure we'll be looking at other levers to take cost out to deliver strong performance in context to what the market does.

We can definitely flex with the volume. If volume goes down for whatever end market reason, we have the opportunity to reduce costs in reaction to that.

But I think the one thing I would say is that at the current oil prices, we would not expect that a further decline in oil prices would have a significant negative impact beyond our current view of the environment.

Okay. Thank you.

Thank you. And our next question comes from Joe Giordano of Cowen. Your line is now open. Joseph Giordano - Cowen & Co. LLC: Hi, guys. Thanks for taking my questions. Just wanted to touch on Fabrication volumes quickly. It's been fairly manageable all year, the declines. And I think people were worried that there was this shoe to drop with maybe part of your emerging market businesses where there's going to be this quarter with this real big volume drop that we just haven't see yet. Are we at a level where you feel whatever declines needed to happen in those South American markets and et cetera have already flowed through and we've seen that kind of decline already and from here we're not to expect that?

Yeah. As we said, we've seen stabilizing business around the world. Now, the business is still shrinking, okay, in the back half of the year. But it's shrinking less than it had been, and the growth rate performance in the back half of the year is largely in line with the guidance that we've given for the business for this year. And we have seen that stabilization in a number of markets around the world. Joseph Giordano - Cowen & Co. LLC: Okay. So safe to say, if you were expecting that huge drop in the volume side, it would have happened already. Okay, then. I think that's important. And then just wanted to touch on the China commentary you mentioned about the particular control, I think I missed what you said initially about the timing of those orders, did you say some into 2016? And I was wondering if you can size that? I think we've talked previously about that being potentially a $75 million opportunity over time, and also like which type of technology have you seen more of your customers kind of leaning towards?

Dissecting that question into its parts, the technology has really been very mixed. We've seen all forms of technology selected, and we have quite a bit of quoting activity going on now. So if you ask the question again after the first quarter call, I think I can give you a more fact-based answer as to what customers are actually selecting. So I don't think we have a whole lot of insight as to whether they're going to go to a solution that's more beneficial to us or to a lower tech solution. There's been discussion around all of the factors. We have booked orders in the fourth quarter, as Matt mentioned. As far as market size I think your $75 million number is a reasonable expectation once the market has ramped up. I don't think we'll be hitting that number for 2016. Joseph Giordano - Cowen & Co. LLC: Okay, fair enough. Thanks, guys.

Our next question comes from the line of Chase Jacobson with William Blair. Your line is now open. Chase A. Jacobson - William Blair & Co. LLC: Hi. Good morning. Thanks for taking my question.

Good morning. Chase A. Jacobson - William Blair & Co. LLC: I just had a bigger picture question about the growth strategy. I mean kind of similar to what you said at the Analyst Day Matt, it seems like we're in a somewhat of a holding pattern here as it relates to growth through acquisition given where the seller expectations still are. So one question is, you know oil is at $30, the industrial outlook is as bad as it's been in a while. When – do you think or what causes those seller expectations to start coming in more? And then the second part of that is, in the meantime how are you going to balance capital allocation between debt reduction and share repurchases? Are we expecting to see an acceleration on the repurchases or a new authorization at some point this year? Any color you could give on those would be great.

Yeah, so, just first talking about the overall growth strategy. I think, our markets are, have lined up over the last few years probably about as bad as you could imagine the different verticals lining up. And we've still got healthy cash flows and decent operating margins. And so as these markets recover, I think we've got tremendous opportunity to have both a top line growth and expansion of our margin in the businesses that we've got. And we're driving a lot of exciting growth efforts within the businesses to accelerate our performance versus those markets. As far as the inorganic piece of it, I think you're right that, this year you know we'd expect to likely be similar to last year. Last year, we did a few really good bolt-on acquisitions. We see the opportunity for that, you never can plan these things but we see the good possibility to have one or two good bolt-ons this year. And then, turn as we move into 2017 and beyond to thinking and looking at bigger opportunities in line with our growth strategy. Between now and then, our capital deployment will be to put our capital where we think it can add most value. We still have a ways to go on $100 million authorization that we've got from the board and, at this point do not anticipate any increase from that. And we'll continue to weigh those buyback investment versus the best acquisition opportunities in our pipeline as we move forward.

I think just generally speaking obviously as cash becomes available we may use it to pay down debt, but our general view is to keep leverage in the zone that's in. I've made some specific comments in my remarks and to one of the earlier questions as to the zone of leverage we would work within and as cash becomes available we'll pay down debt. We may draw the debt back up again in order to meet the capital allocation areas that Matt just spoke about. But we generally expect to continue operating in the same kind of capital structure zone with the same type of things that we did this year and as Matt said the selection as to what's done when will depend on what's best for shareholders.

And then just to make sure we answer your full questions, you asked about seller expectations. So in my experience with these kinds of time periods is that with time and evolution of the environment at some point seller expectations moderate and the view of the future of firms up enough that there starts to be more opportunity for meetings of the minds on the right prices and multiples for transactions. Chase A. Jacobson - William Blair & Co. LLC: Okay. Thank you.

Our next question comes from Schon Williams at BB&T Capital Markets. Your line is now open. Christopher Schon Williams - BB&T Capital Markets: Hi, good morning.

Good morning.

Good morning. Christopher Schon Williams - BB&T Capital Markets: I wondered if any updates on the leadership search over at on the fabrication side, just – I know you brought in Steve and Ken's obviously doing a great job there but any thoughts on kind of new leadership when we might see something there?

Yeah, sure. First I'd say the model that we put in place there is working well. I've been excited have a chance to be working more closely with that business. And I think we've been able to accelerate our progress with the model we've put in place there. And that gives us the time and opportunity to really find a fantastic leader to lead that business. I would say in the early days of the search, I've been really pleased with the quality of candidates that are very interested in us. So, I'm excited at the quality of the candidates. It really becomes a question of fit – really finding the right person that is going to bring all the capabilities but is going to be also a great fit with the role and what it needs and also is going to be a great fit with our business system. And I've had a track record of being able to find leaders like that. And I'm confident that we'll be able to. In the meantime the business is going to keep moving forwards. Christopher Schon Williams - BB&T Capital Markets: Okay. And then just sticking with ESAB, have you noticed any changes in the distribution channel from the recent consolidation? I mean at one point there was some concern that maybe some of the – you may lose some private label product in North America because of that. I just, anything you're seeing in terms of the distribution channel or it's kind of business as usual?

We haven't seen a significant change in the distribution channel there. There are some – obviously the changes there create opportunity. Anytime, there's large change, we think it creates an opportunity for someone like us that is focused on gaining share in that market. But we haven't seen any other kind of more wholesale changes to how things are operating there. Christopher Schon Williams - BB&T Capital Markets: Okay, thanks, guys. I'll get back in queue.

Thank you.

Thank you. Ladies and gentlemen, this does conclude our question-and-answer session. I would now like to turn the call back over to Terry Ross for any further remarks.

Thank you, Sonia, and thank you again for joining us today. We look forward to updating you next quarter. And this concludes our call.