Good day, everyone, and welcome to the Hubbell Incorporated Third Quarter 2013 Earnings Conference Call. Today's conference is being recorded. For opening remarks and introductions, I will turn the conference over to Mr. Jim Farrell. Please go ahead, sir.

Good morning, everyone, and thank you for joining us. I'm joined today by our President and Chief Executive Officer, Dave Nord; and our Chief Financial Officer, Bill Sperry. Hubbell announced its third quarter results for 2013 this morning. The press release and earnings slide materials have been posted to the Investors section of our website at www.hubbell.com. Please note that our comments this morning may include statements related to the expected future results of our company and are, therefore, forward-looking statements as defined by the Private Securities Litigation Reform Act of 1995. Therefore, please note the discussion of forward-looking statements in our press release and consider it incorporated by reference into this call. In addition, comments may also include non-GAAP financial measures. Those measures are reconciled to the comparable GAAP measures and are included in the press release and the earnings slide materials. Now let me turn the call over to Dave.

All right. Thanks, Jim. Good morning, everybody. Thanks for joining us. Let me just give some overview commentary on our results, and then I'll turn it over to Bill for some details. You've seen our results and certainly, we're pleased with another quarter of strong performance. I think our results, we feel very good. Nice, solid performance. And I have to say, I'm particularly proud of our ability, the organization's ability, to perform despite what continue to be very choppy markets. You see sales are up 6%, but our end markets are certainly pretty mixed. Non-res is a little better, but still relying on the strength of the renovation market, not necessarily meaningful improvement in new construction. The resi market continues to be solid, even with some volatility in that market, as you see in some of the -- some of the reports says interest rates rise. The utility side continues to be weak on both the transmission and distribution, and it's also impacted by, at least in the quarter, virtually no storm activity, a very quiet year. Although I think we've seen -- we did have a little benefit this month from a snowstorm up in South Dakota. But no meaningful activity there. And the industrial side is mixed. I'm particularly pleased with our high volt business, starting to come back, and some improvement on our harsh and hazardous. More importantly, we've got margin expansion of 100 basis points year-over-year this quarter, a lot of that driven by productivity and our continued focus on productivity and the benefit of lower material cost. And as we announced earlier this week, we increased our dividend, payable in the fourth quarter, by 11%. On the platform level, commentaries on our electrical systems, as I said, our high-voltage business is up nicely, and…

Thanks, Dave. Good morning, everybody. I'm happy to be using Version B of our comments this morning rather than Version A with -- the government wasn’t paying their bills, and we'd be talking about a different world maybe. But -- so as Dave said, our sales up 6%, with acquisitions contributing about 5% of that. We had FX headwind of 1 point, so organic volume, as Dave was referring to, a pretty modest 2% attributed. Some acquisitions that were contributing the 5% are coming from 5 different investments that we made. Dave just made -- he referred to Nordlux and CMC. What I like about that is they're spread across both segments, electrical and power. And within electrical, spread across lighting, which Dave mentioned Nordlux, but also spread across industrial, as well as harsh and hazardous. So good evidence of how the acquisition program is complementing the organic volume that's out there. Lighting really led the organic growth side of that. As Dave mentioned, the resi side of lighting, quite strong, and the reno side really helping that grow. Another strong grower was high-voltage in the quarter. So the operating margin was up 100 basis points to 18.1%. EPS of $1.62, up 12%. Free cash flow, continuing in excess of net income, which is to get to our annual goal of equal or better. And I hope you all saw, a couple of days ago, raised the dividend to $2 a share, an increase of 11%. I'm going to be using the slides Jim referred to. I'll go by the page number. So I'm on Page 4, looking at the end markets contributing to the 6% sales. In non-res, really, that new construction is really still soft, thanks to the public market being particularly soft and the institutional side of…

Okay. Great. Thanks, Bill. So just looking out for the rest of this year, we certainly continue to be focused on meeting our financial goals. We're looking at our -- for sales growth for the year, finishing at about 5%. That's -- I recall, our last guidance was in the 4% to 6% range, so that's right at the midpoint. That's not an insignificant level of year-over-year growth in the fourth quarter. That would require high-single digit growth, some of that obviously coming from the acquisitions we've done, but a solid mid-single digit market growth, which, before today, could have been highly uncertain. Now, it just has the normal level of uncertainty that we would typically see in the fourth quarter, with a little bit of keeping our eye on what happened, we all recall, a year ago in the fourth quarter when things slowed down. But our order patterns to date, at least halfway through this month, are consistent with our forecast, in some areas slightly better, which we prefer to get ahead of it in October, because the end of the fourth quarter tends to be a slower period. So we feel pretty good about that. On the margin side, we think, based on the performance in the third quarter, that we're more likely to finish it 40 basis points up for the year. So all in all, a very good result. And I think it would set us up nicely going into next year. Now next year is a whole another story. I mean, we -- the things that Bill referred to as our option A or option B on our disclosure, the solution that was designed yesterday, from our perspective, only takes away the near-term crisis uncertainty. But unfortunately, it doesn't solve the long term. And…

Hey, Debbie, let's go ahead and open it up to the callers.

[Operator Instructions] And we'll take our first question today from Christopher Glynn with Oppenheimer. Christopher Glynn - Oppenheimer & Co. Inc., Research Division: Dave, you commented the volatile end markets clearly and the effectiveness of the programs you can control. And obviously, that's showing up. Can you elaborate and maybe give a little detail on specifically some of the productivity programs that are washing through here and now?

Well -- I mean, some of them are the things that we've been doing for a number of years. I mean, first and foremost is on our coordinated sourcing efforts. That was a big element of a business case, you recall, for SAP. And we still have a lot of more opportunity in that area, and it really comes around more coordinated. As I've talked earlier in the year, back at our Investor Day, we're focused around a more coordinated One Hubbell strategy. And so that's really a key to what we're -- what we continue to do and what continues to provide a benefit to us. But we were also looking at other functions within the organization where we can drive productivity and improvement, whether that's in finance or HR or some of the other support functions, as well as getting a more coordinated selling effort. When we're out in the market, we obviously have a great reputation, a great name, and we've built on more than 60 very valuable brands. But a lot of the end market is not familiar with the collective value of that, so we're spending a lot more time on those. And we're seeing some of that benefit as well. So...

I think, Chris, if you were to peel apart our capital projects, productivity projects, you'd see, in a typical year, that 5 to 10 level of spending on 2 or 3 facilities that get consolidated, and then just lots of little projects that -- it's how we -- philosophy get implemented. It's that cell [ph] level. Ideas can come bottoms-up from a very small ideas, and you push productivity by doing lots of sit-ups and lots of push-ups every day. Christopher Glynn - Oppenheimer & Co. Inc., Research Division: Sounds good. And then on the -- it got cut off a little while, so I may have missed something. But on the transmission, you anticipated -- for the 3Q, some got pushed out. Does that -- I take it that stuff that was already awarded. Does that kind of show up in the fourth quarter?

Well, we hope. We thought it would in the third. It's just a question of when those projects get released. And so that's a bit of the volatility that we deal with. So some of that should be in the fourth quarter, but we thought it would be in the third. So... Christopher Glynn - Oppenheimer & Co. Inc., Research Division: Okay. But it's correct to think that it's stuff that's already been awarded?

Yes. Yes, it is.

We'll take our next question from Rich Kwas with Wells Fargo Securities.

Just a couple of quick questions. So on '14, with the 2% to 4% market growth, Dave, could you give us some color on product introductions and just potential outgrowth versus that? I know you've kind of gone through a product cycle with lighting, and I think that's ongoing. But how are you thinking about the rest of the businesses in terms of new product introductions and the ability to outgrow that end-market target, or where you think the end-market is going to grow?

That's an interesting question, Rich. Certainly, we continue to invest in new products. On the lighting side, as a good example about where that -- those new product introductions are not necessarily incremental to the market growth. They're critical to participate in that market growth. However, we've seen examples where some of those product introductions have been able to capture some more market share than we would have had in the legacy product. So there are those examples, but I wouldn't say that there's any particular areas that are going to drive, at least at this point, outgrowth. But that still remains to be seen. I mean, certainly, our strategy is to outgrow the core markets through share gain, and our preferred approach to that is through product innovation, not through price. So we think we can win on the product innovation, but we may lose some on the price. So it could be net neutral at the end the day, unfortunately.

Okay, all right. And then on industrial mix for next year, that was a bit of a headwind. And I know you had some headwind with utility not being as strong. It sounds like, for next year, you're thinking utility is going to be pretty flat. But on the industrial side, do you see some benefits from high-volt harsh -- harsh and hazardous and some of the higher-margin product lines picking up and being a little bit of a tailwind to next, next year on industrial?

Certainly, those are positive contributors on the margin side. And so we would expect those to be some tailwind. The flip side to that -- and of course, at this point, we're always trying to make sure that we're looking at things in a balanced way -- the competitive environment in some of our markets, particularly on the utility side, has become more price competitive. So even flat to slightly up had some potential margin pressure that, as a market leader, we're certainly not going to contribute to. But we've got to be able to react accordingly. So we're a little cautious on that, but you're absolutely right in that we're happy that a couple of markets that are better contributors are picking up as we've navigated through, particularly like the high voltage. So I think there is potential. We're certainly going to work toward that if the pricing environment is supportive.

I also think, Rich, you're pointing out within industrial some of the strong areas. There's also a mix as non-res starts to outgrow the other segments, which we anticipate over the medium to longer term. We actually get some mixed headwinds from that. So as Dave said, it tends to balance it out.

Okay. And then last question on lighting. You did the LED penetration. What are the numbers between residential, non-residential for the quarter, in terms of growth?

Resi was up 17%, very strong, Rich. And the C&I side was up mid- to high-single digits. So really driven from the rental side. So Dave talked about the LED adoption rate, we -- the year-to-date period, were at about 25%. As Dave said, we ended the quarter at 30%, so that growth trend really continues to be there. That adoption rate continues, it does not look like it's tapering off at all.

We'll go next to Drew Pierson with JPMorgan. Drew Pierson - JP Morgan Chase & Co, Research Division: I just want to drill back into price cost a little bit on the -- both for the quarter and then kind of the year. As you see it, what's the magnitude of the price cost benefit, both for 3Q and then full year guidance?

Yes. So the cost for 3Q were a tailwind. They were helpful. Price was -- it's much more challenging. So, and for the year, we're anticipating, if you add -- sometimes we use shorthand, Drew, of price cost to include 4 different variables. We talk about price -- 2 components of cost, one being material, the other being inflation, like wages and health care. And that against productivity. We look at all 4 of those variables for '13, the full year, we've had a very helpful tailwind from those. So that's part of what's been driving a good margin story for us. And what -- as we look forward to '14, as we start to compare the incrementals year-to-year, it's hard to have that tailwind keep repeating itself, and it tends to come back into balance. That's one of the factors we're -- that's driving kind of our margin, both this year and next. Drew Pierson - JP Morgan Chase & Co, Research Division: Okay, that's helpful. I mean, in magnitude, is that like more than 1 point of benefit? Or is it below that?

We -- it's -- we tend not to want to maybe pull it out that specific maybe, Drew. Drew Pierson - JP Morgan Chase & Co, Research Division: Yes, understood. Switching gears, just on the lighting side, maybe the competitive environment, both with your kind of traditional competitors like Acuity and then maybe some of the stuff that Cree is doing in the space. Maybe just an update on what you've been seeing over the last several quarters and your kind of outlook and observations there?

I think that the lighting space is growing very attractively for us. It's -- as you say, there are some newer competitors that -- some of them are targeted towards national accounts. Some of them have a targeted kind of narrow SKU approach. Some of them are bringing a price aggressiveness approach. I think from the way Hubble continues to approach the market, we're trying to be a broad-based lighting fixture competitor. We like to have national presence and be able to offer full SKU breadth, whether it's through a large box retailer on the resi side, or whether it's to a homebuilder on the resi side, or whether it's C&I projects of wide varieties, from airports to parking lots to office buildings. And so I think that the dynamics for the way we're approaching the market continue to be consistent over that last couple of quarter periods that you're asking about where innovation, LED adoption continues to be critical. We're making a lot of investments in that area. Dave kind of highlighted some of the awards for innovation that we're winning. I think it's important to keep coming up with new products, which we're doing. And the C&I side, you have to be good at the reno side to be successful right now over the last few quarters. And we bought a company a couple of years ago that's sort of focused on the rental channel through escas [ph] and lighting services companies. That helps us out. And I think one of the changes is, Dave mentioned a lot of times with customers, I think the distributors are getting very sophisticated as to how they are selling retrofit and reno. And so us continuing to serve our distributors is positive in terms of continuing to compete with someone. So as much as there's a lot of change, I think the market dynamics for us are continuing in ways that allow Hubbell and our competitive positioning to thrive.

Drew, let me give you a quick summary of how I -- how we see it. In my travels, it's clear that lighting is a great place to be because of what's clearly the market demand that's out there. Everybody wants to be in lighting. Of course, as a result, because everybody wants to be in lighting, it's become a much more competitive environment. But that's one that we feel particularly good about, our position, because at the end of the day, you're still -- you're out selling product that you're selling has a longer life cycle. It helps to be someone who's been in the business long enough to be able to demonstrate that they've been around long enough to support that longer product life cycle, has a broad enough product offering to support a complete solution, not just a one-off product. So there's a whole lot of stuff going on with new entrants, with one-off products. And so, that's creating a lot of activity. But the good news is the underlying demand is certainly positive, and we're just going to navigate some of those competitive pressures.

[Operator Instructions] We'll go next to Nigel Coe with Morgan Stanley.

It's actually Mike Sang in for Nigel. I was wondering if you'd give a little bit of color, I know you talked about a little in your prepared remarks on M&A, just what you're seeing in the space, what your backlog looks like. And I think you mentioned a couple of deals here. Just what areas are you focused on in terms of M&A?

I'll let Bill cover that one since I ask him that question all the time.

Thanks, Mike. Yes. So the pipeline continues to thrive. We continue to see lots of good opportunities. For us, it continues -- the challenge continues to be to find the fit that works with our strategy, our product suite, our distribution network, and we're having a lot of luck finding things that seem to fit right now. It feels like the competitiveness on that pipeline is up a little bit. I know that we've gotten a lot of questions over the last couple of quarters as to our price is too high, our valuation is creeping away from us. And I'd say that we feel pretty excited about the values that we continue to see. But I do think that it feels a little bit like competitiveness is up in terms of others looking maybe at the same things we are. But I think Dave really highlighted how we've got things, which is we've got a balance sheet that's poised to make investment, and we've got an increased number of resources internally. And we've made investments in the processes to be more effective, both at finding and integrating our acquisitions. I think Dave made some reference to the fact that our last 2 are getting integrated very well. I'm glad that that starts to become sort of a ho-hum message. That's kind of what's expected, and I think that's going that way. So we continue to be very optimistic about what's out there and our ability to close them and integrate them well. You asked about if there are specific areas, and I think the thing that encourages me the most is that they're not specific areas. They're all areas. We've seen situations across our entire portfolio. We get lots of calls and lots of questions from private equity firms…

We'll take our next question from Jeff Sprague with Vertical Research.

It's actually Ryan sitting for Jeff. Wondering if we could just talk a little bit more about the underlying demand, particularly in the utility business, and particularly with a focus in distribution. I think we all understand what's going on on the transmission side, but the distribution side seems to be at odds with strong resi environment. Can you just talk a little bit more about what's going on there?

Yes, sure. I mean, that's probably the only place that I would say it's -- the demand is arguably at odds with resi growth. But I think we -- some of that, as we've said earlier, is because there was a build-out of existing developments. So there wasn't a lot of new investments. We have seen some benefit in our business on some new developments but nowhere near the level that would be consistent with the resi growth itself. Certainly, we think that would be an element of growth opportunity next year that would offset the otherwise conservative and cautious expectations on demand, on distribution. As I said earlier, we know there needs to be spending there. The problem is particularly with the IOUs. They're under some tremendous pressure on rates, on returns, on capital structure, on source of fuel. You add the dynamic of substitution of renewables, they're -- what we hear from that part of the market is much more caution in the near term until things start to settle out. So I hope that helps.

Ryan, with distribution, I think we may have -- we tend to describe -- the majority of our distribution is maintenance and repair, not construction. And we tended to count on that maintenance and repair to be a steady year in and year out kind of increase in spending. I think what we've witnessed is the shock of '08 caused '09 to be a low-spending year. And as Dave described, some of the pressures I think this year is too. So what we've maybe described as steady has a little more volatility in it, and that's what we're facing. I think your view is right that that construction side of the -- that comes from resi should be to help bolster some of the distribution spending going forward.

And then maybe a similar question on the non-res side, just trying to really get your feel for what you're seeing in that market, maybe in the near term as we kind of start to look out to '14.

Yes. I think in non-res, again, we split it out between public and private. And the public side continues to drag us down. The overstimulation back in '09 and '10 is creating -- it was unsustainable, and creating a little bit of a hangover there. But on the private side, Ryan, -- and particularly in public, some of the institutional side showing some of the more soft -- softness, whether that's education and some of those areas. I think we're strong before. But on the private side, we are starting to see growth. And that's, to me, good news. When you look at some of the leading indicators like ABI, you start to look at square footage and contracts, our put in place spend will lag to start a new building. So we continued to wait for that spending to pick up. We get a lot of questions, when Jim is on the road, about what -- is non-res today or tomorrow or next week? I think we're all sort of waiting for it. And it continues to -- just continues to not look like that hockey stick is right upon us. If you look at some of the third-party forecast, I'm sure you look at some of the same work that we do over the last 6 months, the outlook for next year's non-res put in place spending on buildings has softened a little bit. So that hockey stick was presumed to be, I think, in full bore by next year. I think it's just going to be a bit more modest as we recover.

[Operator Instructions] We'll go next to Mike Wood with Macquarie.

In addition to the third-party trends you were just talking about, non-res and some of the leading indicators, do you get any direct feedback there in that segment from your customers or distributors in terms of backlog or projects being deferred, particularly around the government shutdown? And in any sense in terms of when that log jam might break?

Mike, I would say we certainly have no ability to predict what impact all that nonsense had on contracts and timing on when they might get restarted. We wouldn't really have any insight into that, I'm sorry to say.

Got it. And just on the lighting side, you mentioned health care strength in the reno and some product innovation. I'm curious if you can give some color in terms of how narrow or broad that LED adoption is, whether it's moved beyond -- like those early adopters, and if there's an established trend in office or retailer or other verticals?

Yes. It may be hard for me to comment on verticals, but I would say the adoption is very broad across Hubbell's lighting brands, which I take as a pretty good sign that it's kind of seeping out there. I think that -- you're right to point out that certain applications lend themselves. I think areas like parking lots, airports, they seem to be adapting to LED at a very, very high level. A refrigerated application seems to be adopting to LED at a high-level. I'd say, on the resi side, it's still slow to come around because the prices are still high, the paybacks are a little slower given that your lights are on at home for only a couple of hours a day. So I think it's -- I don't know if it's so much by vertical as it is by application maybe. And it's starting to get, I'd describe, as pretty broad based.

Gentlemen, with that, there are no other questions in queue at this time.

Okay, thanks, Debbie. This concludes today's call. Certainly, I'm available in case anyone has any follow-up questions. And once again, thank you all for joining us this morning.