Good day and welcome to the Edgewell Personal Care Second Quarter Fiscal 2018 Earnings Conference Call and Webcast. All participants will be in listen-only mode. After today's presentation, there will be an opportunity to ask questions. Please note this event is being recorded. I would like to turn the conference over to Chris Gough, Vice President and Investor Relations. Please go ahead, sir.

Thank you. Good morning, everyone, and thank you for joining us for Edgewell's second quarter fiscal 2018 earnings conference call. With me this morning is David Hatfield, our President and Chief Executive Officer and Chairman of the Board; and Rod Little, our Chief Financial Officer. David will kick off the call then hand over to Rod to discuss quarterly results and outlook discussion, followed by Q&A. This call is being recorded and will be available for replay via our website, www.edgewell.com. During the call, we may make statements about our expectations for future plans and performance. This might include future sales, earnings, advertising and promotional spending, product launches, savings and costs related to restructurings, changes to our working capital metrics, currency fluctuations, commodity costs, category value, future plans for return of capital to shareholders, and more. Any such statements are forward-looking statements, which reflect our current views with respect to future events. These statements are based on assumptions and are subject to various risks and uncertainties, including those described under the caption Risk Factors in our annual report on Form 10-K for the year ended September 30, 2017 as amended and supplemented in our quarterly reports on Form 10-Q for the quarters ended December 31, 2017, and March 31, 2018. These risks may cause our actual results to be materially different from those expressed or implied by our forward-looking statements. We do not assume any obligation to update or revise any of these forward-looking statements to reflect new events or circumstances. During this call, we will refer to certain non-GAAP financial measures. These non-GAAP measures are not prepared in accordance with generally accepted accounting principles. A reconciliation of the non-GAAP financial measures to the most directly comparable GAAP measures are shown in our press release issued earlier today, which is available in the Investor Relations section of our website. Management believes these non-GAAP measures provide investors valuable information on the underlying trends of our business. With that, I would like to turn the call over to David.

Thank you, Chris, and good morning, everyone. In a moment, I'll have Rod take you through the financial results, our Project Fuel initiative and our updated outlook for the full year. But first, I'd like to comment on some of the important changes we're making to our business, our longer-term view of the business, particularly in the Wet Shave, why we're implementing Project Fuel, and how we're thinking about the business going forward. We've made numerous changes to our management team over the past year across all the functions including marketing, e-commerce, finance, operations and supply chain, HR and more. We've promoted and challenged several high potential colleagues from within the company and we brought a significant amount of new talent and capabilities from outside as well. As part of our strategic planning process over the past several months, this new senior leadership team has analyzed and evaluated consumer, competitive and retail trends in our rapidly changing environment. We believe that with change comes opportunity, especially for a challenger organization like Edgewell. We see many opportunities for continued growth in our International footprint, additional growth in e-commerce, both in the U.S. and International for further progress building digital marketing and DTC capabilities and expansion of our global Sun and Skin Care business, driven by our recent Bulldog and Jack Black acquisitions. While we're pleased with our progress on these fronts and are confident in our opportunities going forward, there continues to be significant pressure on the North America Wet Shave business. Many of the factors contributing to current category softness in North America Wet Shave may take beyond fiscal 2018 to normalize. The competitive environment continues to intensify and the category leader continues to execute a major price and product portfolio reset, taking significant amount of value out of the…

Thank you, David, and good morning, everyone. Let me turn to some of the key second quarter business performance metrics. Net sales, reported net sales in the quarter were $608 million, a decrease of 0.5% or 3.4% on an organic basis. Organic net sales exclude the benefit from the Jack Black acquisition, the impact from the Playtex gloves divestiture and a translation benefit from currency. Organic net sales in North America declined 7%, while International markets increased 4%. I'll discuss the segments and the drivers of the sales performance in more detail in a moment. Gross margin was 49.7%, 100 basis points lower than the prior year, largely driven by unfavorable price mix due to higher promotional spending in Wet Shave, and a higher level of returns in Sun Care. As expected, gross margin increased nearly 700 basis points sequentially, driven by significant improvement in product costs and volume mix. A&P expense as a percent of net sales was 12.4%, down just over 100 basis points compared to the prior year. The decline was due to a shift in timing to support product launches in the third quarter, and it included $4.5 million of savings generated by our Zero-Based Spending initiative as we aggressively manage non-working spend to increase support of our brands. SG&A including amortization expense was 17% of net sales, in line with the prior year. Excluding $2.6 million of acquisition and integration costs associated with Jack Black and unfavorable currency translation, SG&A as a percent of net sales improved 50 basis points over the prior year. We incurred $3.7 million in pre-tax restructuring expenses in the quarter in support of Project Fuel. Other income, net was $0.2 million in the quarter, down $6.5 million compared to the prior year. The adjusted effective tax rate for the first…

We will now begin the question-and-answer session. The first question is from Nik Modi of RBC Capital Markets. Please go ahead.

Yeah. Thanks. Good morning, everyone. So just two questions. Rod, maybe for you, if you can help kind of give us some context on the savings initiative, I mean, obviously, you just started not too long ago and this seems like a pretty large program. So, how much of this was kind of – were you part of this whole process versus how much potentially could you see as you kind of look deeper into the business in terms of further cost cutting opportunities? And in the second question, David, maybe you can help just draw some context around the innovation pipeline, talk about kind of how active the pipeline is this year versus last year and maybe some of the background on why this year seems to be a much more active innovation pipeline. Thanks.

Yeah. So thank you, Nik, for the question and good morning. So on Project Fuel, if you look at the company's history, I think there's a good track record around cost savings, productivity outcomes. I think the company has done a good job with that and that has continued and I think have been part of the culture. The Zero-Based Spend initiative that was kicked off last year is delivering nice incremental savings. There is real money dropping to the bottom line with that. Zero-Based Spend is really around third-party spend. What we're talking about now with Project Fuel as we move forward is really about what it's going to take to win in the new environment, speed, agility, simplification, driving accountability through simpler structures and ultimately, reflecting the cost to compete has gone up. And so, if you think about what's incremental with Fuel, most of it is incremental versus what we had talked about with ZBS. We're going to look at our A&P spending, the non-working piece of that continuing to drive Zero-Based Spend through that. We're going to look at reallocating some of our trade spend in areas where we think there is even a better ROI and being more efficient. On the G&A structure, you can follow that through with what we're going to do around simplification. And then last but certainly not least, one of the biggest drivers of our cost savings program in Fuel is going to come out of the supply chain network, the operations area where we're just looking at all items of cost and we've got fairly aggressive plans to take cost out of cost of goods as we go forward. So, all items, all elements of the P&L are being hit. I think it's a solid plan. I've done this before and a couple of other goes at P&G in the salon hair care business, we did a complete restructuring and then also at Arden. And so, we're kicking it off and moving forward.

And on the innovation front, I would characterize this year as a very solid year from an NPD point of view, with more volume coming from innovation this year than we would have seen last. And I think that's partially due – we built three to five year product roadmaps, and I think that a few years ago we ramped up some of our efforts against consumer-centric consumer insights against trends, and really focused against perceptible product features and benefits that are tangible and are valued. And I think you see that on the men's side, certainly women's also. And I think that we're gaining momentum on the Sun Care business, buying platforms against Skin Care (00:26:57). So net-net, we're pleased with the year. And if you look forward, we feel that the next several years should be consistent with this year.

Thank you, Nik. Operator, next question please.

Your next question is from Faiza Alwy of Deutsche Bank. Please go ahead.

Yes. Hi. Good morning. So, a couple of questions. First, just on the Wet Shave category, can you talk about what's embedded in your guidance, are you expecting sort of share gains? What are you expecting the category to do just for the back half of the year? And then just if you have any thoughts on the Fem Care category, obviously that's been an underperformer. So just your outlook there would be helpful.

Yeah. Okay. Great. Thank you. From a Wet Shave point of view looking forward, we see International being fairly flat, maybe down slightly in the developed markets and the U.S. category, we see being down in the low-single-digits. We see ourselves basically flat from a share point of view in the U.S. with innovation helping to compete with various factors, and then Internationally gaining modestly behind innovation. On the Sun Care category, we see – and it's kind of weather dependent. We have forecasts that say that Memorial Day and July 4 look favorable. So we're hopeful there, but we see a fairly flat market or that's how we've modeled it out anyway. And then, International, we see resuming growth and we think that we can grow that in the high-single-digits.

Okay.

Then on Fem Care, I think the team has talked about being more focused on profitability out of that segment, as we work to regenerate the top line. And you see that in the current segment, as we talked about the market is healthy. There's a little bit of growth there. We're focused on improving profitability and working plans to regenerate the top line.

Right. Right. Fair enough. Thanks.

Thank you, Faiza. Operator, next question please.

Next question is from Ali Dibadj of Bernstein. Please go ahead. Ali Dibadj - Sanford C. Bernstein & Co. LLC: Hey, guys. I want to dig into Project Fuel just a little bit more along a few vectors, I guess. One is, if you could just provide some specific examples of what you plan to change. Obviously there are many, many things, it sounds like it's everything (00:30:19), but just give us a few examples. And kind of I'm trying to test (00:30:25) confidence that these things will work out, because frankly I'm not sure I would agree with Edgewell having done a good job historically on cost savings or even Energizer before that, even though the Montreal to Dover transition of Fem Care was fraught with hiccups. So, can I get a sense of what types of things we're talking about here, number one? Number two is, the $225 million gross savings. How much of that is going to be net savings we can think about expanding the margins or is this all going to be invested back to impact, what I think is completely accurately described as this new reality, competitively and consumer wise? And then third on Fuel, when does a big project like this, when you think about the new reality and so, how does this impact your long-term view of your growth, of the category growth, of EPS growth? It's been clearly pretty challenging over the past several years to meet what you thought would be the long-term growth. So does it change your long-term view of the industry? So, examples in confidence gross to net and long-term. Thanks.

Okay. Great. Thank you. Yeah, taking them one at a time. Fuel, the way we think about Fuel is it continues on our track record of taking costs out and it allows us to reinvest against change basically. And some of the priorities and the ways of doing things differently include accelerating investments against International growth opportunities, China; putting more money against e-commerce where we continue to gain share; also, really building out digital and the DTC capabilities; and also accelerating Bulldog and the Jack Black growth. Thirdly, Project Fuel really represents an opportunity to, I mean, streamline the organization, simplify ways of working to increase, I mean, speed, agility and competitiveness, and this goes a little bit to the long-term vision here. As we're moving into the design phase of the Project Fuel, we've taken the challenge on to define better what our vision is for how we're going to win in this new reality. One of the sources of inspiration in defining that vision was, it was really taking a look at our smaller acquisitions, Bulldog and Jack Black, particularly Bulldog because we know it, we've owned it longer. And we've had a great success to date with it due to its strong purpose-led brand and a management team as well as our mandate to our organization to help accelerate it or else get out of the way. And we've used this in workshops to generate lessons learned and build a vision of how we can act like a large, small company, more of a financially wealthy startup. We call it leveraging the power of small and some of the principles are to retain and improve our outer focus against consumers and the customers. Certainly, I mean streamline all the inner-focused processes, simplify the organization to clarify accountabilities and foster entrepreneurialism, and then finally deleverage digital to speed up innovation and drive intimate brand salience. One example that we've just recently done there I think shows how this vision could manifest itself is we've recently collapsed our roster of agencies from a 20 traditional, social, digital agencies down to one global creative agency. We think this will, I mean, strengthen our digital capabilities and will really propel us toward becoming a digital-first marketing organization. This agency has 90-plus offices around the world and has an intense focus on the consumer at a local level, but also offers global scale and will help drive us to a unified brand voice across all the consumer touches and will help us to simplify around the world. So, that's where we're taking Fuel and that's kind of the longer term vision for how we can change and become a much better marketing organization. There was a second question. Yeah, Rod, I'll let you take that.

Yeah. On the gross to net, so Ali, we're not prepared today to disclose the net number, but let me tell you how we're thinking about to give you a little more perspective. We spent a lot of time getting to the $225 million gross as the right number that we think we need to have to go forward to really do three things. One, offset natural inflation in the business and commodities costs, the input costs that we're currently seeing, that's a bit of an unknown in the future, but we think the $225 million would protect us for what would be normal rates going forward. The second bucket is really around reinvestment in all the things David mentioned. We're cognizant that growth is going to take investment and so we're creating the headroom to do that in digital, e-comm, A&P increases against our base brands and then the International Jack Black, Bulldog growth opportunities that are there, as we look forward. And then the third part of ultimately down to your point around net how much, this is very much about margin enhancement and closing the gap that we have versus a competitive set on bottom line profit margin. So how much ultimately becomes net, we're not ready to disclose that yet but that's something we'll work towards and we'll come back and work in our next conversations to be able to have more detail around that. Ali Dibadj - Sanford C. Bernstein & Co. LLC: And I'm sorry just, just around the long-term targets that you're setting from a top line and margin perspective or EPS, I guess, growth perspective that you had set before, are you in any position to comment about those changing at all at this point? Thanks. I'll get off.

Yeah, we're really not in a position to reset or to comment about that the longer term except that I'd say that one of the reasons for Project Fuel and the aggressive targets that we're setting there is a feeling that the competitive set is volatile at the moment and that we see that continuing into the next fiscal year. Ali Dibadj - Sanford C. Bernstein & Co. LLC: Okay.

So, yeah, thanks. Ali Dibadj - Sanford C. Bernstein & Co. LLC: Thanks.

Thank you, Ali. Operator, next question please.

The next question is from Wendy Nicholson of Citi. Please go ahead.

Hi. Could you address – I heard what you just said about trying to make the ad spending more efficient and improving sort of the digital mix and all of that, but it still surprises me that ad spending was down as much as it was in this current quarter. And I guess specifically behind the Fab, I mean I have seen exactly one ad for Fab in a magazine, nothing more than that. So, I'm surprised, number one, as you think about the category, Razors and Blades, it's so competitive. You actually have a new technology that seems really differentiated. I'm surprised that you're not spending more behind that. And maybe, Rod, could you address sort of just generally ad spending has dropped about 200 basis points as a percentage of sales over the last few years, do you have a sense for what that level ought to be, given the business mix, given the competitive environment, are we going back up to 15% or 16% of sales or is 12% or 13% the right number, because obviously that's going to feed into Ali's question about net-net, how much margin expansion should we realistically expect? Thank you.

So, first, for the quarter, we were down modestly mainly because we cut your non-working agency money, and then some of which based frankly back to Q3. I think you're going to be seeing – we are, I mean, spending heavily against innovation and the way the phasing works, I think that you'll see a significant increase in Q3. The way we plan A&P is bottom up, brand-by-brand, market-by-market and we compare share of voice versus share of market and the delivery targets that we think we need to support both the brands and then innovation. So, it's more of a bottom up exercise. I don't know, Rod, if you had anything that you like to add?

Yeah. So, Wendy, I would add, in the quarter, specifically Q2, we had a $4 million savings on the non-working A&P that David mentioned. It was part of the ZBS program. The other part of what you're saying is the phasing to Q3 as we look at it. That said, I think our view is that we're going to need to spend more in A&P. And the level we're at today of that 13% range, we see that increasing as we move forward, maybe not all the way back to historical rates, but more directionally that way, recognizing those investments are going to be required to grow and we are optimistic about the innovation pipeline and we certainly want to support it in the right way. So, we see that going up.

Got it. And can you just talk about Fab generally, kind of how it's performing relative to your expectations?

Sure. It's early days. We're off to a great start. Europe and the Asian markets, I think the go-to-market plans have been very good and we see very strong merchandising, et cetera. In the U.S., we're off to a, I mean, strong start. The accounts are really pleased about it and are actually adding to the back half plans. The one area of disappointment with the category being soft over the last couple of years, I mean, customers have become more strict about SKUs being neutral. So where we thought Fab would be totally additive to our share of shelf, it's only been slightly positive and the result has been a little bit more cannibalization of Hydro Silk and so that's why you saw some of the soft sales. Fab consumption looks really good and we're optimistic as A&P dials up now.

Great. Thank you.

Thank you, Wendy. Operator, next question please.

The next question is from Olivia Tong of Bank of America Merrill Lynch. Please go ahead.

Great. Thank you. So, just a question on pricing. Clearly, Procter has been investing significantly into price, but this is also in response to pricing that arguably went too far in the category. And as you noted, there's a potential that this pricing could heat up in the back half with Harry's launching at Walmart. So, I guess given all these dynamics, why do you think pricing ultimately stabilizes going into fiscal 2019? And then with the Harry's launch happening soon in Walmart, what did you see when Harry's launched at Target and what actions did you take to sort of defend your positioning? Thank you.

Sure. Thank you. I guess on the subject about pricing going into 2019, I'm not sure that I can really, I mean, speculate. I think there are several scenarios and it's a part of the uncertainty that we have about 2019 and one of the reasons that we're really ramping up Fuel. Trying to compare Target, Harry's going into Target versus Harry's going into Walmart is a little bit of an apples and oranges comparison. I think there were a lot of factors back when they entered Target that are no longer true. And the merchandising and the circumstances within those customers vary also. So, I think that the Target comparison isn't a very helpful guidepost. And I won't really comment about customer-by-customer tactics, but I'll say that in general, our defense is basically innovation, leveraging the full portfolio, I mean category management and then tactical promotions where we need to dial it up.

Okay. Thank you. Operator, next question please.

The next question is from Bonnie Herzog of Wells Fargo. Please go ahead.

Hi. It's actually Joe Lachky on for Bonnie. So, I was hoping you could talk through the drivers leading to your third quarter guidance revision, and how much of the $0.40 revision is attributable to Japan, and how much is due to changes in the North American environment? And maybe if you could elaborate a little bit on the trade inventory reductions in Japan, is it one specific retailer, is it more widespread? Are you losing shelf space or are these inventory reductions impacting all manufacturers? Thanks.

Hi. Good morning, Joe. So on quarter three, the bulk of the reduction, if you look at the reduction versus what we were looking at internally setting up last quarter, I would say Japan is a little over half of the reduction, somewhere in that area. The balance is largely in North America, there's a little bit in a couple of other markets, but it's split really along those two things. In the North America when we talked about Toys"R"Us, there's another quarter to go and that bankruptcy sorting out. And then there's the competitiveness around Wet Shave that we talked about. If you look at Japan specifically, this happens in other categories, but the way the market works there is we sell into wholesalers who then sell on to the end retailers. So what specifically happened in our case is there's two wholesalers that carry – they carry a broad range of CPG products. One in particular decided to take a sizeable inventory reduction that's one-time in nature, essentially down from around running at 70 days of inventory to approximately 40 days. And the decision was made to do that now one-time and not do it slowly over a longer time period. And so, we see that largely contained within Q3. And then coming out of that, we feel like we would be back to more normalized consumption and product shipments into the wholesalers that are matching consumption. The good news in Japan is our teams are performing very well there. We have share growth in the market up 0.6 points on a past 12-month and up a full point on a past 12-week basis.

Okay. Thank you, Joe. Operator, next question please.

The next question is from Katie Grafstein of Barclays. Please go ahead.

Hi, thanks. So, I just wanted to ask about private label Wet Shave in the U.S. So, I know you've been cycling through the Fits Mach3 (00:50:06) launch over the past few quarters. So, I was wondering how this business performed this quarter. And then also, we've learned a large club customer is coming out with an upgraded men's razor. I was wondering if Edgewell is the supplier of that. Thank you.

Thank you. For the quarter, private label was pretty flat from a share point of view in the U.S. and from a sales point of view. So, we've been pleased with how the business has performed and we're doing well within the U.S. and we've gained customers Internationally. So, we see growth there also. In terms of new customers and that kind of thing, we don't comment as a general practice on our programs with who were the customers.

Okay. Thank you. Thank you, Kate. Operator, next question please.

The next question is from Jonathan Feeney of Consumer Edge. Please go ahead.

Good morning. Thanks very much. It's a question particularly for Rod, but – and really anybody. It seems like as a strong number two player in North America Wet Shave, you're in a unique position to disrupt, be creative particularly as it relates to e-commerce and I guess two questions. First, what are you doing that's different in e-commerce than your largest competitor and maybe even the clubs? How do you fit in there? And secondly, Rod, what's your assessment of the potential for that channel for a number two player generally and compared to some of the experience you've had at your recent posts? Thank you.

And I'll take maybe just the first point on, Jon, what we're doing differently. It's essentially the same category management argument for brick-and-mortar for the pure-plays, but we're really leveraging the full portfolio and not just featuring super premium products and we do market and emphasize, I mean Hydro, but we offer and we merchandise our middle tier products in also private label. So, that's really the difference that we bring.

Yeah. And Jonathan, in terms of our e-commerce approach and how we are thinking about it, I won't comment necessarily on others. We have a new leader that David brought into the organization recently who was actually at Vineyard Vines leading their e-commerce effort. She's in the process of building out the team now and we're recruiting a full team positions underneath her. There's approximately 15 on the team now, it's getting bigger. And we think that we have an opportunity to be very agile, very nimble in this case. Some of the things Jack Black and Bulldog were doing were connected bringing those learnings in. And as we go forward, we'll continue to add to the team and I think you'll also see us be more active with the retailer.com sites in those approaches, and you'll see more DTC activity coming from us across the portfolio and the brand set. Anything else, David, on that?

Yeah. Yeah. I'll comment that the pace of our direct-to-consumer efforts will accelerate. Examples would be that we've just launched Bulldog direct-to-consumer site in the U.K. and we will be coming out with a Version 2.0 for our Schick Hydro DTC site in the U.S. in the coming couple of months.

Okay. Thank you, Jonathan. Operator...

Thank you very much.

Thanks, Jon. Operator, next question please.

The next question is from Bill Chappell of SunTrust. Please go ahead.

Thanks. Good morning. A couple of questions on the smaller categories, I guess one on Skin Care that being up 1%. With the weather, I assume Sun Care was down quarter-to-date though I realize it's kind of a sell-in quarter. Can you maybe give us an idea of how that played out or how that affected it with or without Sun Care?

Sure. Yeah. In the U.S., quarter two only accounts for 10% of the year. So it's really not a peak time. And you're right, weather was awful. So, the Nielsen category, it was down about 8%. We held or else gained marginal share. But looking forward, we actually do see weather coming back and we'll see if that comes true. But we're heartened going into this season because we have 6 of the top 10 new items as measured by Nielsen and then 13 of the top 20. So we think that we're well positioned for Q3.

Okay. And then in terms of the Fem Care business, just is it getting worse? I mean, it seem like it was in a pretty tough place over the past few quarters, but some of your commentary seems I think that it continues to lose share, lose placement and I didn't know after we've gone through the spring reset if we're actually in a worse situation than you might have thought.

Yeah. As we came through the planogram season, customers continue to cut overall category shelf space and while we gain some phasings with some of our key customers, we lost share of shelf more than we thought in some of the key drug customers. So, we have work that we need to do on the category management front. So, work remains and it's a tough category for us. We are launching several new products this month, one of which is the Stayfree All-in-One pad. It's ultra-thin, but it's designed to cover periods' leaks and moisture. So, we're looking forward to that innovation launching along with Simply Gentle Glide tampon. So, the team is working hard on it. But I have to say that the most recent planogram season didn't go like we planned.

Thank you, Bill. Operator, next question please.

The last question is from Kevin Grundy of Jefferies. Please go ahead.

Thanks. Good morning. Thanks for fitting me in. Two-part question, if you wouldn't mind. This is sticking with Fem Care and Infant Care, but the two-part question is a portfolio one. So, the first part with respect to Fem Care and Infant Care, it's not uncommon in these types of restructuring, earnings reset type scenarios for you to take a harder look at the portfolio and ask the question let's be in the businesses that we should be in and not necessarily the ones that we are in, and where there's that proverbial right to win, the categories are attractive and you can grow profitably. And David, you just mentioned a moment ago the difficulties that the company continues to have in the Fem Care category and that's certainly been the case in Infant Care for a number of years. There's been sort of a hope to speed up innovation, stabilize the businesses and clearly that's not materializing. So, if you could comment was this part of the process an openness to getting out of some of these businesses where you haven't had success, it's been costly, profitability has not been good, et cetera. So if you could comment on that and whether that was part of this process or there's an openness or greater openness to it going forward, that would be helpful. And then related to, you know, with respect to M&A, where do you guys stand with that now, given the large amount of change that's going to be taking place at the company? Is there too much risk for you guys to be looking at any sort of bigger assets? Is that the way that investors should think about it, or are you still open to tuck-in M&A? How should we think about that now in the coming quarters, if not over the next 12 months just given the significant amount of change that's going to be happening at the organization? Thank you.

Yeah. Thank you. Good questions. On the portfolio rationalization front, we look at that regularly with the board and we'll continue to look at a right to win versus scale impact in all those things. So I can't comment beyond, it's something that we regularly look at with the board. In terms of your second question about M&A, we continue to look in like closing adjacencies whether it'd be men's grooming, Skin Care in general, Sun Care, those sorts of categories. I do think with the amount of change that we're taking on, I don't think it changes our appetite, but I do think that we'd consider complexity and we'd factor in executional risk when we look at a target. So, I can't speculate whether it will slow down or not our pace, but I can assure you that executional risk will be considered looking forward. So, thank you.

Thank you. Good luck.

Thanks, Kevin. Operator, next question please.

This concludes our question-and-answer session. I would like to turn the conference back over to David Hatfield for any closing remarks.

Well, thank you all for your time and your interest and have a great day. Thank you.