Good day, ladies and gentlemen, and welcome to the Fourth Quarter and Full Year 2016 Genpact Limited Earnings Conference Call. My name is Sonia, and I will be your conference moderator for today. At this time, all participants are in a listen-only mode. We will conduct the question-and-answer session towards the end of this conference. We would expect this call to conclude in an hour. As a reminder, this call is being recorded for replay purposes. I would now like to turn the call over to Roger Sachs, Head of Investor Relations at Genpact. Please proceed, sir.

Thank you, Sonia. Good morning, everyone, and welcome to Genpact's fourth quarter earnings call to discuss our results for the fourth quarter and full year ended December 31, 2016. We hope you have had a chance to review our earnings release which was posted to the IR section of our website, genpact.com. With me in New York today are Tiger Tyagarajan, our President and Chief Executive Officer; and Ed Fitzpatrick, our Chief Financial Officer. Our agenda today is as follows: Tiger will provide a high level overview of our results, as well as update you on some of our strategic initiatives. Ed will then discuss our financial performance in greater detail and provide our outlook for 2017. Tiger will then come back for some closing comments, and then we will take your questions. And as, Sonia, just said earlier, we expect the call to last about an hour. Some of the matters we will discuss in today's call are forward-looking. These forward-looking statements involve a number of risks, uncertainties and other factors that could cause actual results to differ materially from those in such forward-looking statements. Such risks and uncertainties are set forth in our press release. In addition, during our call today we will refer to certain non-GAAP financial measures, which we believe provide additional information for investors and better reflect the way management views the operating performance of the business. You can find the reconciliation of these measures to GAAP in our earnings release in the IR section of our website. And with that, let me turn the call over to Tiger.

Thank you, Roger. Good morning, everyone, and thank you for joining us today for our 2016 fourth quarter and year-end earnings call. We are pleased with our full year 2016 results as we delivered strong Global Client BPO growth of 13% on a constant currency basis, expanded our adjusted operating margin and significantly grew our adjusted earnings per share. With that said, we are seeing heightened levels of volatility and uncertainty in the global environment. Now, more than ever, enterprises need to be nimble and react quickly to compete in their respective markets. Our digital transformational services uniquely positions us to drive value for clients. These consulting, digital and analytics services now account for approximately 20% of our Global Client revenues and collectively grew more than 20% in 2016. Specifically during 2016, total revenues increased 6% on a constant currency basis. Global Client revenue increased 9% on a constant currency basis. Global Client BPO revenues was up 13% on a constant currency basis. Adjusted operating income margin grew 20 basis points to 15.5%. Adjusted EPS was $1.46, up 16%. Bookings for the full year increased to approximately $2.65 billion, up 3% from $2.59 billion recorded in 2015. During the year, we continued to invest in our client-facing teams as well as enhance our capabilities, positioning ourselves as a leading partner of digital transformational services for our clients built on domain, industry depth and operations expertise. As a result of G&A leverage and disciplined cost management, we deliver our adjusted operating income margin goal of 15.5% and grew EPS by 16%. Our overall Global Clients revenue was up 9% year-over-year on a constant currency basis. During the year, as companies continue to adopt new business models, they dramatically reduced spending on deploying, maintaining and running legacy IT infrastructure. This trend, coupled…

Thank you, Tiger, and good morning, everyone. Today, I'll review our fourth quarter and 2016 full year results followed by key balance sheet and cash flow highlights. I'll also provide our financial outlook for 2017. Before I get into the details of the quarter's performance, I want to remind everyone that at the end of 2016, we reclassified revenue related to the GE business divestitures to Global Client revenue for year-over-year comparison purposes. Along with this, we've also reclassified revenue related to our recent acquisitions of Endeavour Software Technologies and PNMsoft from IT services to BPO revenue as these services are being embedded into our BPO digital solutions. 2016 revenues from these businesses have been reclassified to BPO revenue to allow for better year-over-year comparison. Our fourth quarter and full-year 2016 results for our GE, BPO and IPO businesses are reported without these adjustments to provide a consistent view of the underlying growth trends for 2016. Note, however, the effect of digital reclassifications to our 2016 revenue will be the basis for which we provide our 2017 year-over-year growth guidance and actual results. To help clarify the impact of these changes, we have provided a supplemental schedule in our fourth quarter earnings press release that reconcile the impact for the four quarters and full year of 2016. Let me begin with the review of our fourth quarter results. We generated total revenues of $682 million, an increase of 5% year-over-year or 7% on a constant currency basis. Revenues from Global Clients, which represent 85% of our total revenue, increased 9% year-over-year or 11% on a constant currency basis. Within Global Clients, Business Process Outsourcing revenues grew 12% year-over-year or 14% on a constant currency basis. Our Global Client IT services revenues declined 3%. GE revenues, which represent 15% of total…

Thank you, Ed. In 2017, we expect the macro environment to continue to be volatile. Operating in this uncertain environment, there is no question that digital transformation is mandatory for our businesses to stay competitive in every industry. Key technology trends shaping business transformations include the growing importance of big data and analytics, providing companies with real-time predictive insights to drive actions. Second, transformation driven by the Internet of Things across a range of industries. We're already developing many IoT-driven solutions helping clients optimize inventory levels and grow aftermarket service revenues, et cetera. And third, artificial intelligence making the lead from science fiction to reality with solutions being developed to work collaboratively with humans to solve intensely complex problems. Combining advanced digital technologies with design thinking, deep domain expertise and operations expertise represents the core of our unique Lean Digital approach to drive disruptive transformation for clients. We have created strong momentum in the market as evidenced by our industry-leading Global Client BPO growth rates. As we look to our future, we are continuing to evaluate our business portfolio taking a deep dive to determine where to double down and increase our focus as we drive long-term growth and create shareholder value. Before signing off, my team and I look forward to seeing you at our upcoming 2017 Investor Day on March 2 at our innovation center in Palo Alto, California. We have a great day planned for you to experience Lean Digital, interact with members of our leadership team and provide you with an update on our growth strategy and financial initiatives. With that, I'll turn the call back to Roger.

Thank you, Tiger. We'd now like to open the call for your questions. Sonia, can you please provide us with the instructions?

Thank you. And our first question comes from Ashwin Shirvaikar of Citi. Your line is now open.

Thank you. Hi, Tiger. Hi, Ed.

Hi, Ashwin. Hi.

I guess my first question is with regards to the GE contract renewal. Did that involve either significant pricing impact or perhaps has it been restructured more in the form of sort of an outcome/output based as a service-type contract given the Predix comment?

No, Ashwin. The renewal at the MSA level has not changed anything on the topic of outcome-based or on the topic of any structural change. That actually is something that is ongoing at specific SOW process level. As you can imagine in the diversity and the range of work we do, it cannot be addressed at the MSA level, and we've been doing that just as the world has been evolving to outcome-based, transaction-based, gain share-based, particularly as we do more and more work around the Internet of Things, remote monitoring, Predix as a platform as GE becomes much more of a digital industrial enterprise. At the MSA level, I mean, it's a very regular renewal, which we are thrilled with.

Got it. And the three large contracts, the Global BPO contracts that you mentioned, just in terms f timing, did they sign late in the quarter post-elections before any comments on recent client or prospect interactions? How are they viewing outsourcing? Is there more focus on automation versus offshoring?

Yeah. Actually, it's a great question, Ashwin. The three specific contracts happened during the quarter. I think as the contracts were being signed, I would say, the U.S. political environment had actually already unfolded, so that didn't change the signing of those contracts. However, as we've seen in the last two or three months, clearly, apart from digital being a big conversation, obviously, a lot of other potential macro changes are also big conversations in every company, whether it's taxes, immigration, trade, protectionism. And therefore, how do you run a global company? But remember that is in the contract, already those being the big conversations driven by digital. So, this is just one more element of, what I would call, a need to think about business models. And does that, therefore, change the way clients think about the way to run their companies? Absolutely, yes. Does that, therefore, change the speed at which sometimes they come to a decision? Yes. It does slow some decisions down. And do we need more options to solve for different problems? The answer is yes. Here's the good news. We have a history of U.S. operating delivery that goes back 15-plus years. We have 4,500 operating folks and 7 operating centers in the U.S. that have done and run operations for our clients for 15-plus years. And therefore, our ability to actually offer those to our clients, which we've done in the past in many, many situations. But to change the scale of those is something that positions us in a competitive advantage position in those conversations, and we've actually taken those to some of our clients. For some clients, it becomes a conversation that is important for them given their situation. For other clients, that's not what they want, they want digital transformation. And for our third client, they're really more interested in global delivery. So, I don't think one size fits all. The reality is that we have many options that allow our clients to pick and choose based on their situation.

Got it. Last quick question. Any products on how we should think of the cadence of how revenues and cost work through the year given the continuing volatility?

Yeah. So, the pacing throughout the year, again, affected by how 2016 rolled out. So, first half of the year given the full year guidance on a constant currency basis 3% to 6% will be lower in the first half and higher in the second. So, first quarter, likely flattish, and then up slightly in Q1 and then the growth will come, the more material growth and that 3% to 6% range will come in the second half of the year.

Got it. Thank you, guys.

Thanks, Ashwin.

Thank you. And our next question comes from Joseph Foresi of Cantor Fitzgerald. Your line is now open.

Hi.

Hi, Joe.

Hi. How are you? Maybe you could quantify for us where you're seeing the biggest pain in IT services and maybe what actions are being taken there?

So, Joe, for us, the pain in IT service would start with two verticals that are material in IT services for us, Capital Markets and Healthcare, and those two verticals have been the most impacted for us in our IT business. And in those verticals, IT is a material portion of those verticals. Obviously, those verticals also tend to be at the lower end of growth for us across our range of verticals. Outside of Healthcare and Capital Markets, and those two I think the reason for those we've talked about many times, I think it's pretty obvious in the macroeconomic environment both in terms of the way the Capital Markets industry has been over the last year, and the Healthcare industry with all the modules and changes and therefore, the stop and start on decision making.

I think on that category, we haven't planned for getting worse, Joe. It's really what happened last year having the full-year effect. As you know it happens the second half of last year and the revenues went down. So, it's (34:02). We haven't planned for it to get worse. We haven't planned for it to get better either. It's really kind of status quo as what we've assumed right now.

Outside of that, if we line up industry by industry and service by service within our IT services, there are clearly segments of those services that are actually doing exceedingly well and they tend to be those where we have deep domain in that industry, deep domain in that service. And therefore, we actually understand that way applications have to be used, the way applications design happens, the way you actually leverage the technology better and actually maintain and run it and manage it better. And that's where we tend to win. So, the portfolio analysis that I talked about, we are actually undergoing it right now where we will actually double and triple down in some of those areas in IT and reduce our focus in some of the other areas where we don't have that competitive advantage.

Okay. And then on GE, is 2017 going to be the trough year for a decline perspective in GE or your long-term expectations post 2017?

Yeah. It's a great question, Joe. So, first of all, the transformation that we have undergone in our overall portfolio as GE has undergone its transformation with GE Capital is worth noting. Two-and-a-half years back, just two and a half years back, our total revenue from GE was 20%-plus of our business. By the time we get to the end of 2017, it will be high-single digits percentage of our business. That is a material shift and a reduction from our perspective on concentration with one client, all of which is good for all of us. Having said that, as I've said, our renewal of the GE contract positioned us well more importantly, I think, the work we've been doing in building out a team of people on the Predix platform, people who understand the platform, people who understand the development of apps on that platform, people who understand how to use analytics on that platform, and being able to have those conversations not just with GE, but also those other global industrial majors who want to use an Internet of Things platform such as Predix in order to be able to drive the subtle value for their business models. And you can imagine IoT as a big team. So, with that context and background to answer your question, I would say there would be a follow-through effect...

In 2018 but not nearly the extent that we're seeing in 2017.

But I would not expect any new event to happen with GE.

Yeah.

And that positions us well for a stable GE and then growth.

Okay. And then the last one from me, you put other bookings growth (36:58). And I'm just wondering, is it even possible to break that out into sort of Global Client BPO versus ITO and GE? I imagine there's a lot more in there and it's an aggregate number, but I'm just trying to get some clarity on how those different businesses are set up for going forward?

I think I missed the first part of the question. You were asking about Global Client ITO versus GE ITO?

No. I'm more concerned about the bookings for Global Client BPO versus ITO and GE. I imagine the bookings number which has been a much larger growth over the past years is being held back by those two areas.

Yeah. Joe. I would say the bookings numbers are congruent largely with what you're seeing from a revenue perspective, right? GE and IT being down and Global Client BPO growth driving the actual growth, being offset by those two. So, I would say largely congruent.

So, just to add to what I'd said, Joe, as we always maintain, post the ramp-up on bookings that we had between 2013, 2014 and then 2015, we had said that longer term, revenue growth and bookings growth will kind of track each other, and that's what we are seeing as we look at bookings between GE bookings, IT bookings and Global Client BPM bookings. So, Global Client BPM bookings are tracking exactly what revenue is tracking for 2017.

Thank you.

Thanks, Joe.

Thank you. And our next question comes from George Tong of Piper Jaffray. Your line is now open. George K. F. Tong - Piper Jaffray & Co.: Hi. Thanks. Good morning.

Good morning, George.

Good morning, George. George K. F. Tong - Piper Jaffray & Co.: Can you provide some details around how the pipeline conversion rates and renewal rates are trending?

So, let me give you some color, George. Let's start with win rates. Our win rates are broadly holding. As you can imagine, our win rates on Global Client BPM, Global Client Transformation type of work versus Global Client IT, those tend to be different and they are holding exactly the way they are. So, I don't think there's any material change in win rates. Conversion rates are broadly fine. There is clearly in the last, I would say, three months extension of time in some of that conversion. So, we are seeing and we have seen a material extension of time where times are taking longer to actually get to finally signing the contract. And that's, as I said, to the question that I think Joe was asking a combination of thinking through digital and transformation and the sequencing of all of that, as well as the landscape of where work needs to be done, et cetera, et cetera, and the timing of all of that. So, we are seeing extension of time. And the third thing is clearly as clients think about sequencing, there has been a trend for some time now where clients are saying, why don't we re-architect the business first which therefore means, why don't we have a deeper consulting transformation engagement where we actually use digital to redesign our business in order to drive significantly disruptive outcomes? And as something that comes out of that, there's a managed services component. It's a material managed services component that we end up managing. By definition, therefore, you would have transformational engagement first then followed by a managed service engagement, that changes the profile of what comes into the pipeline first, which tends to be translation services would then becomes managed services later, but it enters the pipeline later. So, by definition, therefore, the inflows and the pipeline will have different sizes, will have different total size, all of that being reflected also finally in growth rate in Global Client transformation being higher than over our Global Client BPO. George K. F. Tong - Piper Jaffray & Co.: Yeah. Makes sense. You've indicated that your digital transformational services are about 20% of Global Client revenue and are growing significantly above Global Client revenue growth rates. How much of your pipeline do these revenues represent? And where do you see that converging over time?

So, actually, George, it's a little difficult question to answer because remember in transformational-type engagement and consulting-type engagement, the cycle time of, okay, I'm ready to talk to you I think it's interesting to find a way to solve this problem, versus what actually works out. It's far, far shorter than in a classic Global Client BPO deal. So, the notion of a pipeline has been very carefully thought through because the classic Global Client BPO pipeline would last, let's pick a number, 12, 15 months from the time the first conversation starts. Right at the top of the funnel versus the Global Client transformation pipeline could have a shorter timeline of 60 days. So, it's a much tougher – I don't think it's a real comparison because you'll end up being an apple-to-orange comparison. The right way to think about it is, are we getting enough throughput on the Global Client transformation type of work? Are we getting those in a sole source way? Are we being able to create enough of a disruptive impact for our client? And then are they converting into managed services relationships? And those are all good for us. George K. F. Tong - Piper Jaffray & Co.: Yes. Very helpful.

George, you asked a question on renewal rates, no real changes in renewal rates. Still very high, 90-plus percent. No change there. George K. F. Tong - Piper Jaffray & Co.: Got it. Got it. That's helpful. You've indicated that for IT services, you expect no real improvement or deterioration in trends for the full year of 2017 as reflected in your guidance. How would you think about the trajectory of the recovery as you move through the year?

I don't know if that's recovery. I think it's just the normal rollout of that. So, the year-over-year comparisons will be a bit tougher the first half of the year versus the second. So, I'd say you'll see that trend that year-over-year comparison should improve as we get throughout the balance of the year. So, pretty steady. Q1 is typically the lowest quarter. Q4 is typically the highest, George. So, that doesn't change. George K. F. Tong - Piper Jaffray & Co.: Yes. And then, just a quick (43:41) from me. Can you frame how you're doing the proposed border adjustment tax under the new administration may impact the business?

George, you probably heard everybody responded to this, but it's too early to tell on things that are being proposed. Obviously, we'll read everything that's out there and come back to you once things actually get proposed and/or become law. But we're watching it very closely. We are a global company. We will assess and if we have to adjust and do our strategic tax planning and operations planning based upon what's best for our shareholders to drive value. So, we'll come back to you once the facts become available.

And, George, one thing that we pride ourselves on, and I think our board is part of the statement I'm going to make, is agility and nimbleness. We will be able to, once we know what the facts are, be able to react and shape our thinking in that new world. George K. F. Tong - Piper Jaffray & Co.: Very helpful. Thank you.

Thanks, George.

Thanks, George.

Thank you. And our next question comes from Anil Doradla of William Blair. Your line is now open. Anil Kumar Doradla - William Blair & Co. LLC: Hey, guys. Couple of questions. So, last year, if I got my numbers right, Global Client BPO business grew about 12% to 14% on a constant currency. This year for 2017, we're talking about 10%. So, I totally get what's happening with GE, what's happening with ITO, but why are we seeing almost 300 bps of deceleration on the BPO part of the business with Global Clients.

Anil, hi. Anil Kumar Doradla - William Blair & Co. LLC: Hi.

First of all, your number, by the way, is correct. And the reality is that we are taking into account the combination of what digital is doing in terms of the sequencing that I've talked about. And what that means is that managed services work is actually being sequenced in some of these cases, particularly in the larger deals which as we'll explain. We're doing a lot more of the $40 million, $50 million deals versus the $50-plus million deals. We did three of the $50-plus million deals in the fourth quarter. But some of that is really converted into bigger consulting digital transformation engagements. That does change the growth cadence in terms of the sequencing of that across our portfolio. The second is that actually the nature of work itself was changing where a lot of that work is getting automated. And we are driving that with our clients for the work that we do, as well as the work that the client does. And the combination of those two, not to talk about the last two or three months around re-evaluation by some of our clients around the specifity and the nature of sequencing, again, for global delivery as they look at their overall global footprint between the U.S. and Europe and Asia and for example in some cases some clients are saying, let's do Europe and Asia first, let's sequence the U.S. later. So, we've taken all of that into account and I would say that that double-digit Global Client BPM growth we are very excited with because we think that that would position us very well in the competitive landscape given what's happening in the world.

Anil, and to clarify, our process for giving you our outlook for the year has not changed, right? So we use... Anil Kumar Doradla - William Blair & Co. LLC: Okay.

We know what's in backlog at the beginning of the year, so that same percentage applies. We're in the low 70 percentage in terms of visibility for the full year, and then we get after what is unsold and what is our opportunity convert that to a sale during the year. That has not changed. So, the pipeline being a bit less robust than where it was is what causes that. It's effectively how do we convert that to revenue during the year. For us to get back to that level, we would need that to become more robust. But we're looking at the box in front of us and that's what's bringing us to the double-digit, which is pretty terrific top-line growth for Global Client. Anil Kumar Doradla - William Blair & Co. LLC: Okay, great. And as a follow-up Tiger. And as you know I love BPO, I love what you guys are doing. But when I step back and look at it from a strategic point of view, and I wanted to be critical of what's going on, the issues around GE and the issues around IT were well known. I mean, it's being going around for some time. And now, we find the company a little bit in a dire straight situation where some of these things are declining very rapidly. So, from a strategy point of view, when you look at the business, what do you think you've gotten wrong here. And Tiger, you talked about big strategic moves here. So, help us understand how you're thinking strategically because are you caught in a tough situation that you didn't' anticipate, and therefore, you're going to have to rest towards making a decision to grow back the revenues or try – help us understand from a strategic point of view.

So, from a strategic point of view, Anil, I think we've got it all right. I'm sorry. If you step back, four years back, we decided to refocus our energies on a few defined verticals and a few defined services and a few defined geographic markets. Those haven't changed. And we love the fact that we chose those and we love the fact that we narrowed our focus down. Then, we said in those narrowed-focused areas, we will invest. And we said we will invest in the front end, in very senior client-facing teams that can have real strategic conversations because we knew that that's where the world was going. And then we said we want to invest in capabilities, and we picked digital, analytics, consulting and domain as the lead capabilities to build. And if you look at the world today, we are growing at Global Client BPM growth of 10% because we made those choices. In the absence of those choices, I would argue that companies that haven't made sharp choices on where they focused their energies on and then built the capabilities around digital, analytics and consulting and domain and having led with that in transformational services would I think have a problem dealing with the world of today but more importantly the world of tomorrow. So, I understand the overall context of your statement. We obviously would love Global Client BPM to be mid-teens which is the direction that we've always been in. but in the macro environment that we are in with the changes that are happening, we think we are very well-positioned because of the strategic moves we make. Now, that doesn't stop us from continuing to evaluate, which is the discussion I had around portfolio evaluation and deeper dive into specifics around IT and record double down in some areas, that we will continue to do like anyone else. Anil Kumar Doradla - William Blair & Co. LLC: Very good. I'm looking forward to the Analyst Day where we can understand some of these things.

Thank you, Anil .

Thank you. And our next question comes from Tien-Tsin Huang for JPMorgan. Your line is now open.

Hey. Good morning. Just I guess, Tiger, with your comments with M&A and the bigger appetite to do deals, I'm curious just to your willingness to do or to have EPS dilution with the deal or even sacrifice margins as you evaluate prospects, any consideration there?

So, Tien-Tsin, I wouldn't start by saying that we would kind of have that as a goal for obvious reason, Tien-Tsin. But given the type of honing in on specifics that we've done. Both from a specific capabilities and verticals perspective, but also more importantly the specifics around digital capabilities and analytical capabilities that we now have clearly defined – I mean now have in our funnel. I think your statement around margins is a relevant one. And we would and we have actually, in the last couple of tuck-in acquisitions that we did, not had margin as the driver of those acquisitions. And we will not have margin as a driver of those acquisitions. A lot of the acquisitions that we are looking at are digital in nature, analytics in nature that are actually going to continue to fuel and double charge the direction of the world is going in and the direction that we are taking the company in its relationship with clients around the whole digital transformational agenda and filling some of the gaps that we have in specific deep domain, be it insurance or banking, et cetera. Margin would not be the top criteria in those choices for obvious reasons.

Tien-Tsin, you know the cost of capital is still very attractive. So, using our cash and/or debt is not hard to get to EPS accretion, but what Tiger said is valid that capability build is not coming with a lot of margins potentially out of the gate.

Yeah. That makes sense, but just I'm asking because it does seem like those kind of assets are quite hot. So and of course, subscale in many cases, but the product and the talent is good. So, let me ask just a follow-up, I know that it's been asked a lot around bookings and your comments around client volatility and uncertainty, but just I guess maybe asking more directly, is there any change in the client appetite to say outsource in your non-digital or your traditional business in the aggregate where there's BPO or IT? I'm just curious, is there any change in client appetite to outsource in those areas? I understand (53:23) digital but just the legacy stuff. Thank you, Tiger.

So, Tien-Tsin, actually, the way I would answer the question is, the bookings do not reflect any change. I don't want to outsource any change in that attitude because the bookings, the full-year bookings, so that doesn't reflect that. I would say that at the margin, if you think about a typical business like us, we would probably be talking to 300, 400 specific clients across the globe and most of these are global companies. So, obviously, they either have headquarter in the U.S. or they have U.S. operations. And then, they have headquarters in the UK, in Australia, in Japan, and so on. So, over the last 60 to 90 days, clearly, there are at the margin conversations around, should we do this differently? We have not seen a single situation where a client had said, we don't want to do anything. I don't think that's an option. In fact, I would argue that the world of today means that the chances of someone saying we don't want to do anything is probably zero. Even more so than just six months back or a year back. So, in effect, you're actually saying everyone needs an ecosystem of partners to undertake journeys of various kinds that make sense for them. Some of that will be outsourcing, some of that will be you manage this for me, some of that will be you manage it for me later, first, have me change it. Some of that change will be driven by digital, analytics, et cetera. So, given what's happening in the world, we actually see many more conversations build out. The major of these conversations are clearly changing and have been changing, and I think over the last 60 days some of that margin has changed around sequencing of outsourcing.

Great. Thank you for your insight.

And Tien-Tsin, one other point, obviously, is particularly in the U.S., and this applies to Global customers but U.S. operations, some of that conversation is changing to, let's actually leverage your Pennsylvania Center or Texas Center to actually get some of the value around being able to use some of our capabilities in order to have transformation in their operations because that's the value I want to capture right away.

Thank you. And our next question comes from Edward Caso of Wells Fargo. Your line is now open.

Hi. Good morning. Good evening.

Hi, Ed. Morning.

Hey. Can you talk a little bit about the relative profitability of your Pennsylvania, Texas operations versus doing it, say, in India or the Philippines? Thanks.

It's a very difficult question to answer because it depends on the nature of the work that is done rather than the location. The reality is that when work gets done very close to our client and when that work is sensitive, it's high-end, it has regulatory components to it, it has a strong digital, analytics set-up embedded technologies and tools in it, and it has incredibly deep domain expertise associated with it. There is no reason to believe that the profitability of those relationships are any different irrespective of when it's not.

I mean, the price charts that we use are different location by location, so that doesn't change, right? So, we're here to make money. We'll save money for clients, we'll also make a profit, so the price to price differential is there based upon by location by location.

Right.

If it was – sorry. And what I would, therefore, say is if it was just do the same work the same way and just get it done from Pennsylvania, the answer is that would not be valuable for our clients most importantly at all. And therefore, by definition it won't be valuable for us.

Can you talk a little bit this whole immigration debate the difference for the IT players versus the BPO players. Just help us out on exposure to visas, the risk of slowing down work shifting offshore and et cetera. Just help us differentiate between IT and BPO. Thanks.

So, I think it's a rhetorical question you're asking because you got it right. There is a difference between the classic IT players versus the classic large-scale BPO players. By definition we have operating footprints. Those operations are staffed by local U.S. citizens and permanent residence in those locations. They do the same work for years and years. In fact, as I said, they have big domain expertise in that space and that makes a huge difference in that debate. It positions us in a differentiated way. It positions that portion of the industry in a differentiated way. Because the dependence on visas is dramatically lower.

And just finally just to be really clear if I understand what you said earlier, are you seeing a change in the pace of the ramp up of both in the signing of contracts and the ramping up of those contracts within the last few months? Thank you.

Have seen, as I said, it's not all encompassing. But there are clearly situations where the clients have said, let's actually talk about a change that we want. In a sequence, a change that we want and where does work gets done from? A change that we want in the scale of one, versus the scale of another? The scale between my U.S. – their U.S. operations and their European or Asia operations. And any time there is a changed discussion of a global relationship, it means you've got to change the solution, change the commercials, change the contract or change the contracts that we were on the verge of signing. And that, therefore, means an extension of the factors then which I referred. So, we have seen that. We've seen that as I said in a set of clients. I wouldn't call it pervasive, but there doesn't seem to be a specific pattern to the set of clients. The good news is, as I've said, we need to have as a good partner, the ability to be able to provide multiple options and multiple solutions depending on various situations that our clients are dealing with.

Great. Thank you.

Thank you.

Thank you. And our next question comes from Keith Bachman of BMO. Your line is open.

Thank you. Of course, I'm going to ask a question. The one question, I suppose. But I just have one question anyway. As you think about the IT business, I'm just curious why it doesn't get worse and a lot of the traditional IT players are under duress in facing slower growth rates and frankly have meaningful scale advantages. And so, either A, you feel like you have some unique advantages within the context of the clients you serve or, B, I would think just the other players are going to crowd you out of the IT services side until it continues to be a long-term challenge. So, I was hoping to get your response to that thought.

Keith, I think it's a great question. I would start by saying that everyone of the IT deals, we have one that we now have as part of our portfolio, have been one an intense competitive situation with those same large-scale IT players as our competitors. And the clients, for a very deliberate reason, chose to work with us. And that's right now for this portion of the discussion, I'm going to leave out Capital Markets and Healthcare, I'll come to that. Those advantages typically as it relates to domain, as it relates to our knowledge of – for example, if you are working with a client where you manage all of their finance globally and all of their procurement globally and all of it interconnection by the way with HR and the people out of the process though we may not manage all of their HR processes. Then there's a very good likelihood that the management of the financial suite, the procurement suite, the application that sits there, the upper end of the infrastructure that sits there, they turn to work with us in those situation depending on the size of the client. And this would typically be not necessarily the top 100 clients in the world, Fortune 100. But as you get to the Fortune 500, there are care relationships we have in those. That comparative dynamic has not changed. And they see value when we do that because we tend to then find ways to drive true effectiveness more than anything else in that technology transformation. Given what's happening with technology because of digital again. And it's again domain-led. So, I don't see that compared to situation changing. In fact, as I said, our portfolio announcement that we're doing right now is to identify the specific thoughts because we think we can double and triple down on those and win more in those spaces. And then you have spot where there is no such competitive advantage. But the first statement I would make is, that's where we got hit the most in the 2016 when we declined revenues, and that's going to flow through in the 2017. Obviously, as that happened in 2016, very less of that to happen in 2017. And then, the Capital Markets business, if I can refer to that one. In our view is that the real crunch down on Capital Market as an industry, and not (01:03:46) has probably been happening for a year, a year-and-a-half, two years now. Hopefully, it's at its bottom, and if one assumes that, and that's an assumption we're making that it's not going to get any worse in the capital market industry. Then I would assume that our relationships are strong enough to hold what we are doing. And as a work that we do, by the way, is outstanding and the clients give us extremely high scores for that. So, we don't expect that to change.

Okay. So, it sounds like you think it's kind of gone through the process of right sizing for the areas you're exposed in 2017, get a little bit more but then it will be balanced on where you think you have some competitive advantages, is that a fair summary?

That is a very fair summary.

Okay. (01:04:29).

Yeah. For 2017. Yeah. Keith, that's a good summary. Thanks.

Thank you. And our next question comes from Frank Atkins of SunTrust. Your line is now open.

Thanks for squeezing me in. I wanted to ask about margin given some of the headwinds on GE and ITO that you're forecasting on the revenue side, what gives you confidence that you can drive margin improvement given some of the dynamics on the top line?

Yeah. So, consistent with what we've done the last few years, the margin improvement is not based upon gross margin improvement. It's based upon leveraging with the growth not growing the bottom line's been particularly G&A to the extent of top line. So, it's really that leverage that we're planning to drive to improve the operating margins. The GE, we're going down, that does have some effect because it was higher level work that we're doing for GE within GE Capital that's going away, but that's been factored in that outlook. I'd say the EPS ranges that we gave do assume even at the low end of our revenue guidance, the $2.61 billion that we'll have to manage our cost structure to ensure that we still hit that 15.7% to get to the EPS at the low end of the range. So, that's what we're going to plan to do. Because as you remember, we had dialed up our capability investments and some of that is also baked in to what we're doing in 2017. So, we'll need to meter that spend in and manage the G&A spend to offset to ensure we hit those numbers.

So, Frank, that's one of the great question because the question is actually the right question. And apart from everything that Ed said, clearly, the investments we've made on the front end and on R&D capabilities, we have said that as we get to steady state, and we are actually at that steady state point, we would actually start getting some leverage. So, you're seeing some of that come through. You're obviously continuing to see us as we've always had over 15-plus years of continued focus on driving productivity in a range of our operations as well as our other G&A, and you are seeing that in our gross margin performance. But most importantly is our gross margin performance is also driven by the quality of our revenue. And part of that is driven by the type of work that we've been talking about through this call. The more digitally-embedded those relationships are, the more transformative those relationships are with transformation being one of the drivers of our growth. You would expect some of that to flow through into the margin line that then offsets some of the portfolio changes that you just described.

All right. Great. Thank you very much.

Thanks, Frank.

Thanks, Frank.

Thank you. And our next question comes from Jason Kupferberg of Jefferies. Your line is now open.

Thanks, guys. I just want to come back to the comment around the sequencing and the changes in some of the client behavior there because I'm not sure I'm completely understanding it. So, it sounds like what you guys are saying is that more clients want to prioritize upfront transformation or consulting work before they get into the larger long-term managed services deals. But if we just look at the guidance, I guess, for 2017 the Global Client ITO is still going to be down 5% to 7% in constant currency. So, I'm just trying to understand some of the puts and takes there. I mean, are you guys getting the front end work or you more are waiting for the managed services piece while perhaps others are doing some of the front end work for the customer?

So, I don't think there's any relationship, Jason, between the Global Client IT work meaning there's a zero relationship between the Global Client IT work and the transformation work that either clients want or do, at least, in our business. The transformation work that clients want from people like us is I'd like to redesign the way my global claims operations run in the property and casualty insurance business that I have. And that's an effort that would be a six-month, nine-month effort which starts with a complete study of the way claims is being done, the way those processes are run, the technologies that I used, the tools that I used, the distribution of that work into the field was into central groups, the analytical basis of some of those decisions, et cetera, and then creating a road map of change, and in many cases begin to drive that change. That doesn't fit anywhere in our IT business and it would not, so there is no connection at all. We are seeing that in our global client transformation piece of the business within Global Client BPM business, getting 20%-plus growth rate. That then subsequently leads to more managed services deals within that Global Client BPM portfolio. So, by the way, the sequencing and the changes of sequencing started a couple of years back. There is now one more element of that sequencing that a few clients have raised, which is in some of their minds, they're saying given the current vertical environment actually would like to do that first. So, I've decided to that first. In many other cases, people anyhow wanted to do that first because that is the right thing for them to do because they would get faster value, and then they would hand it over to someone else to manage. And by the way, this has many shapes and forms in the way this plays out. But it's exactly the way we see it in our financials as well. So, it's exactly playing out exactly that way.

Okay. I got it. So, basically, that front-end stuff is just going into the BPO bucket, not into the ITO bucket, that's (01:10:21).

Absolutely. Absolutely.

Okay. Just a quick follow-up. On M&A, I mean, how high would you consider taking the leverage ratio. Obviously, you're only at 1.1 right now, so you've got a lot of room. But if the right opportunity arose, how high could that (01:10:35)? Thank you.

I mean, I think we've said we wanted to stay between 1 and 2, which is our stated framework and that kind of aligns to where we are in investment grade rating. And then, once you get to 2, you start to get to a point where, okay, you're maybe getting high, could we go above that for its M&A was attractive enough for us to go? I think the answer to that is yes. We could go above that with a long-term commitment to say to get back within that 1 to 2 range. So, our view would be getting to 2 is not problematic at all and going above that is not problematic if our long-term story is to stay within that 1 to 2. And that's what we would like to do to retain that investment grade rating.

Thank you. And our next question comes from Bryan Bergin of Cowen & Company. Your line is now open. Bryan C. Bergin - Cowen & Co. LLC: Hi, guys. Thank you.

Hi, Bryan. Bryan C. Bergin - Cowen & Co. LLC: Hey, Tiger. On the GE Capital new clients that you've mentioned eight contracts signed, can you talk about the prospects for adding new scope to the earlier ones that you signed? And then just help us understand how the reclassification of those engagements into BPM? How that potentially impacts the overall BPM growth rate?

So, let me answer the first part, Bryan, and then I will have Ed to answer the second one. Clearly, we had already said that as we signed these new contracts it really opens up great opportunities to have new conversations with new clients. We had also said that it takes time to build those relationships. In many of these situations, not all, but in many of these situations, the buyers of the GE Capital businesses have not done this type of work and have not had managed services being run by partners like us. So, obviously, through this journey of managing the TSA (01:12:34) first for GE, then signing the new contract, then continuing to do the work that we were doing, and now beginning to talk about other opportunities are objective like any other new client would be to build those relationships. And as we've always said, in those relationships it takes time in our business to then move that into pipeline, et cetera. Are we beginning to see that? The answer is yes. Those are beginning to get added to our pipeline. By definition, there would be a slow ramp until we get a breakthrough in terms of a new deal and a new relationship with a new client in terms of a new area. But all of those are conversations that are happening as we speak. We have allocated specific account manager and client partners to each of these eight new relationships as you would expect. And we feel good about the fact that these are all set up for growth.

And on the reclassification of those revenues into the Global Client about 50 basis point impact on year-over-year growth. Bryan C. Bergin - Cowen & Co. LLC: Okay. Thank you.

Thank you. And our next question comes from Bryan Keane of Deutsche Bank. Your line is now open.

Hi. This is (01:13:50) calling on behalf of Bryan Keane. My question was more on the competitive environment. Have you seen any shift study that are from smaller players or the IT majors both multinationals and for the Indian heritage? They've been talking about BPO and the operations business a lot. And has that influenced maybe the client decision-making? I was just wondering if you could comment on the competitive environment.

So, I don't think I would call out anything new just in the last quarter, last couple of quarters. We see the same players. They're trying to do the same things that we've seen them do. I think it's very clear that particularly in the world of today, if you haven't and if you don't continue to invest in vertical domain expertise and you bring that into the conversation and the context of leveraging and really changing business models using digital and analytics are completely automating large slots of work that gets down in the midland back offices while ensuring that it actually dramatically improves the way those businesses deal with their customers in terms of customer experience, et cetera. If all of that will not drop together in the context of really understanding the domain in the industry, those conversations are becoming more difficult. The commoditized nature of work is actually going away and we knew that that was going to happen. It was a question of time, which is why we decided many years ago to really pivot around industry verticals and really build depth around those industry verticals. And then, over the last three years, apart from continuing to do that, we've added depth around bringing digital and analytical capabilities that actually mix with that domain makes it a huge differentiator for our clients. So, I think those who have that, the competitors of ours will have that combination are the ones who are doing exceedingly well and some of that has borne out (01:15:57) in the results that you see.

Thanks for the color, Tiger.

Thank you. And our next question comes from Gary Rea (01:16:07) of Morgan Stanley. Your line is now open.

Hi. Thanks for taking my question. Your comment on double-digit growth in light of various investments made earlier on is well taken. But my question is do you think this 10% growth in the Global Client BPO is the new normal, and how long would be in the interim period before you actually starts seeing an inflection point for sequence of want to move to big downstream managed services contract?

Yeah. So, Gary (01:16:36) it's a great question. I don't think I'll be able to answer it over a call like this. It is a question that we all have to think about. There are multiple forces at play here. The under penetration in the market continues to be massive. That hasn't changed. The catalyst for change has changed, which means there are more catalysts for change now. That pressure for change has been building up. I just think in the last couple of years with what disruption has happened using the use of technology in and analytics, the factors for change is massive. And then I would actually argue the current macroeconomic and political environment is another catalyst for change. So you put all that together, one would argue that it's set up for long-term growth. Obviously, when you think about these things, time horizons does make a difference. So, as I said, it's a longer run. So, with many puts and takes. But we feel very good about that trajectory and we feel very good about our position to be part of that trajectory.

Thank you, Tiger.

Thanks Gary (01:17:41).

Thank you. And, ladies and gentlemen, this does conclude our question-and-answer session. I would now like to turn the call back over to you, Roger Sachs, for any closing remarks.

Thank you, everybody, for joining us today. We look forward to seeing you in parallel to our Investor Day in March and talking to you at the end of next quarter. Thank you.

Ladies and gentlemen, thank you for participating in today's conference. This concludes today's program. You may all disconnect. Everyone, have a great day.