Good morning. This is Steve, and I will be your conference operator today. At this time, I would like to welcome everyone to the Pentair First Quarter Earnings Conference Call. All lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question-and-answer session. Thank you. I will now turn the conference over to Jim Lucas, Vice President of Investor Relations and Strategic Planning. Please go ahead.

Thanks, Steve, and welcome to Pentair's first quarter 2016 earnings conference call. We're glad you can join us. I'm Jim Lucas, Vice President of Investor Relations and Strategic Planning. And with me today is Randy Hogan, our Chairman and Chief Executive Officer; and John Stauch, our Chief Financial Officer. On today's call, we will provide details on our first quarter 2016 performance, as well as our second quarter and full year 2016 outlook as outlined in this morning's release. Before we begin, let me remind you that any statements made about the company's anticipated financial results are forward-looking statements subject to future risks and uncertainties, such as the risks outlined in Pentair's most recent 10-K and today's release. Forward-looking statements included herein are made as of today, and the company undertakes no obligation to update publicly such statements to reflect subsequent events or circumstances. Actual results could differ materially from anticipated results. Today's webcast is accompanied by a presentation, which can be found in the Investor section of Pentair's website. We will reference these slides throughout our prepared remarks. Any references to non-GAAP financials are reconciled in the appendix of the presentation. We will be sure to preserve time for questions and answers after our prepared remarks. I would like to request that you limit your questions to one and a follow-up and get back in the queue for further questions in order to ensure everyone an opportunity to ask their questions. I will now turn the call over to Randy. Randall J. Hogan - Chairman & Chief Executive Officer: Thanks, Jim, and good morning, everyone. We were pleased with our first quarter result, beating the expectation set at the beginning of the year. The top line was consistent with expectations, and we saw a strong execution in all businesses…

Yes. And your first question comes from the line of Steven Winoker from Bernstein. Your line is now open. Steven Eric Winoker - Sanford C. Bernstein & Co. LLC: Thanks, guys, and good morning. Randall J. Hogan - Chairman & Chief Executive Officer: Good morning. Randall J. Hogan - Chairman & Chief Executive Officer: Good morning. Steven Eric Winoker - Sanford C. Bernstein & Co. LLC: Just a couple of quick questions. The first one is can you maybe comment on the treasury rules and regulations that came out, particularly regarding earnings stripping and the impact you see on Pentair's tax rate over time? John L. Stauch - Chief Financial Officer & Executive Vice President: Yes, Steve. Still obviously, processing, it's a very generic rule now. We've got to look into the specificity of all of it. But in the next several years or at least the longer term, for however long we have the debt in place, we don't see any impact to our overall tax rate. But clearly, the rules would challenge acquiring North American businesses and layering on new debt onto those businesses. So, we would have to take advantage of our operational synergies to get to those tax synergies that we would have. And, clearly, any acquisition in the future needs to strategically fit and be an operational synergistic acquisition, and then we would look to utilize our advantaged structure to still gain the cash fluidity and then, ultimately, advance the cash strategies on a more permanent basis. Steven Eric Winoker - Sanford C. Bernstein & Co. LLC: Okay. Great. Thank you. And then there's been quite a lot of speculation, Randy, about how you're positioning Valves & Controls. Clearly, you've been improving the business and we can see that. But part of that debate is…

Your next question comes from the line of Deane Dray from RBC. Your line is now open.

Thank you. Good morning, everyone. John L. Stauch - Chief Financial Officer & Executive Vice President: Hey, Deane. Randall J. Hogan - Chairman & Chief Executive Officer: Morning, Deane.

Hey, in Water Quality specifically Aquatics, that's impressive core revenue growth of 13%. So, it looks like you got off to a strong spring selling season in pool. Anything regarding like a pre-buy that happened? Are there going to be any comp issues? And how does this business set up for the second quarter, because that's also seasonally important? Randall J. Hogan - Chairman & Chief Executive Officer: Yeah, Deane. Our dealers are the pool builders. They exited last year with a pretty good backlog of pools unbuilt. So they entered the year with a backlog of business to do, plus we have all the rebate programs and all the advanced equipment, the Eco Select line we have. So we really think it's – there's share gain, but it's generally market. There's not a lot of pre-buy. The early-buy program we had was not remarkable. And so a lot of this is not the big early-buy product but real – if you will, stocking to sell through or normal seasonal stocking to sell through. So we've had a lot of momentum in that business and we continue to invest in that business in sales and in new product development in order to keep the momentum going.

Do you have a sense of the product vitality of your pool equipment recently? I know you had the IntelliFlo, but just how much of that product line is new in the last three years? Randall J. Hogan - Chairman & Chief Executive Officer: I think I'll get the number wrong. It's close to 30% right now. And it's not just the IntelliFlo – in fact, we have a new – the next versions of IntelliFlo are coming now. But there's new controls, there's new LED lighting, there's new heaters. There's really a complete new suite of product, all aimed at fitting that Eco Select sustainability mark. And as you – I think as you saw we just got the third ENERGY STAR award from the EPA which makes us a sustained sustainer. I don't think they call it. So, we feel really good about that business, and we got a lot more growth. And, as you know, that was the basis, it was our strength there, that was the basis of foundation of our aquaculture business, which is, again, just managing bodies of water.

Understood. And then, over on the Valves & Controls side, so you've added Dennis Cassidy to the team. And I'm interested in hearing, as you bring him onboard, he's coming in midstream and that's an unfortunate pun, but he's onboard when you already have an existing restructuring plan, existing commitments and just what's the continuity in terms of leadership there? Was John going to be still part-time there? Does he roll off? And should we expect any tweaking to the plan and the commitments because you said you're going to exit 2016 which will be if the math works in the teens in margins. I just want to know what kind of variability there might be with the change in leadership? Randall J. Hogan - Chairman & Chief Executive Officer: Well, I mean, it took us a while to find the right person for the reason that the business is facing some challenges and we needed someone who's up to it. I'm quite excited to have Dennis. Dennis from AlixPartners, I know AlixPartners has a reputation for transformations and restructuring. And he has some of that experience, but he also has some extraordinarily deep and successful experience doing value stream transformations in the oilfield services business. And he's deeply engaged in the energy field. So, as we – well, let me back up. He spent a lot of time getting to know the business and the programs that are in place, and he's totally onboard with them. And he'll tweak them, and he certainly has – as president, he has full right to do that. But, it's again, tweak to, tweak, it'll be tweaks to get us to the objectives we have. One area where he will be very focused is on these two value streams, Aftermarket and Projects and tuning, if you will, the business, so that we can really focus on the Aftermarket so that as it comes back, we can gain share there. I think, as we've said before, we really didn't differentiate the way we served Aftermarket versus Project. And by tuning the system, we believe that we can get growth in that market. And the fact that he's intimate with the industry is really, really beneficial and that he's done things like this before. As for John, he's back to being CFO full time and Dennis doesn't need his help anymore than, what he'll get with John as CFO. John L. Stauch - Chief Financial Officer & Executive Vice President: And that's plenty.

That's great to hear. Thank you. Randall J. Hogan - Chairman & Chief Executive Officer: Thank you.

Your next question comes from the line of Joe Ritchie with Goldman Sachs. Your line is now open. Joseph Alfred Ritchie - Goldman Sachs & Co.: Thank you. Good morning, guys. John L. Stauch - Chief Financial Officer & Executive Vice President: Hey, Joe. Randall J. Hogan - Chairman & Chief Executive Officer: Hey, Joe. Joseph Alfred Ritchie - Goldman Sachs & Co.: Hey. So, I heard a few times in your script, you guys mentioned the word stabilization. And so, I want to touch on that a little bit, specifically is it relates to the order rates what you're seeing in your front log in Industrials. And, I guess, what implication, if anything, did that have to the guidance range – did the guidance raise you had in Tech Solutions? John L. Stauch - Chief Financial Officer & Executive Vice President: I can answer that, Joe. I mean, very little. I think the word stabilization is really related to the fact that when we exited Q4, we saw double-digit declines in our North American Industrial space. And clearly, Q1 became a big quarter to see if that was going to continue or start to recover in. Clearly, we had achieved our expectation in Q1, but we also saw order rates on a daily basis start to, as we said, stabilize, which means becoming less worse and starting to improve on a day-to-day basis. A long way to what we'd say is a growth recovery but certainly gives us more confidence of the Enclosures business and also the North American Industrial hitting its expectations for the year. The tweaks to Technical Solutions are really around, we continue to build a project backlog in the Industrial Heat Trace business. We feel really good about that backlog. It is impacting margins slightly,…

Your next question comes from the line of Steve Tusa with JPMorgan. Your line is now open.

Hey, guys. Good morning. Randall J. Hogan - Chairman & Chief Executive Officer: Hi, Steve.

So, I just wanted to be clear on the tax question. So, is there – like, is there risk that the tax rate is going up or what are you kind of messaging here? That there's kind of TBDs that need to be worked out? What is kind of the final message on that for now? Randall J. Hogan - Chairman & Chief Executive Officer: The simple answer is everything they've announced has nothing to do with anyone who's already got the structure, and we already got the structure. That's point one. Point two is we have to figure out what it means for things we do in the future. But right now, we're not doing anything because we're focused on cash and earnings execution. But when we get back to doing acquisitions, we're going to have to look to see what the impact is in terms of what's called the debt pushdown strategy, what they called earnings stripping. We still – on whatever we do, we'll still have the opportunities to focus on operating synergies, as John said. And we still have the ability to move cash around freely which is an extraordinary advantage that doesn't get focused on as much in our tax structure versus our former tax structure.

Right. And you don't have to keep as you grow earnings, you don't have to keep adding inter-company debt to kind of make sure that that extra income is shielded, for lack of a better term? Randall J. Hogan - Chairman & Chief Executive Officer: No

Okay. Got it. On the Valves, I think, you made – I joined the call a little bit late, but I think you called the Valves recovery two years out. Can you just maybe expand on that a little more? Does that mean you don't expect growth until really 2018, is that a simple way of saying that? Randall J. Hogan - Chairman & Chief Executive Officer: No. What we said was that we – and it was an imprecise comment. It was actually an adlib off the script. We think there's a chance that project orders will bottom out in the second half this year which wouldn't give us growth until next year, second part of 2017 – so, maybe 18 months. Right now, we're not clairvoyant. But if we saw projects start to recover in the second half then ultimately it will give us growth about (36:16).

So, can you grow in 2017 do you think at this stage? John L. Stauch - Chief Financial Officer & Executive Vice President: Yeah. I think we can grow in 2017. Randall J. Hogan - Chairman & Chief Executive Officer: Particularly, Aftermarket has to come back. I mean, the fact that Aftermarket is down and short cycle. Basically, there's a continuum of ongoing maintenance. There's must do. There's good to do. And there's nice to do. And right now, they've taken a cleaver to all their spending and it's just bang, down 40% and so, they haven't really fully sorted it out, and to the OpEx too. Now, they got to get back to the must dos and the should dos but they don't have to get back to the nice to dos. So, that's what we want to be close to and help them as they sort out – now, they've insourced things they're going to figure out longer term that they probably should be outsourcing things. It's very fluid. John L. Stauch - Chief Financial Officer & Executive Vice President: Steve, I think real quickly, I just add to what Randy said. I mean, I don't think we see or we'll be able to call the recovery this year. Which means, any growth we get will be our backlog plus modest expected growth in 2017. Given where we are in the base this year, we would expect to grow modestly next year, continue to work the cost actions that we need to, and then any long-term recovery or rapid recovery is definitely in our views beyond 2017.

Got it. And then one last question just on the Flow & Filtration segment. I think that implies a relatively strong back half of the year. Is that some lumpiness in Food and Beverage? What's kind of the driver there? John L. Stauch - Chief Financial Officer & Executive Vice President: Yeah. It's just Food and Beverage. I think what we've got is we've got a little bit of customers who have completed some consolidations and they're a little bit more lumpier in their execution of the projects and how their letting the capital flow through. And so, while we still have a very solid backlog, we're seeing a little bit of retiming of that backlog, which is impacting what quarter that ships.

Got it. Thanks a lot. Way to go. Randall J. Hogan - Chairman & Chief Executive Officer: Thank you, Steve.

Your next question comes from the line of Shannon O'Callaghan from UBS. Your line is now open.

Good morning, guys. John L. Stauch - Chief Financial Officer & Executive Vice President: Hey, Shannon. Randall J. Hogan - Chairman & Chief Executive Officer: Good morning.

Hey. On Valves & Controls, just in terms of actually hitting the forecast this quarter, that seems regardless of what the actual numbers were, it was on plan, which has been a challenge. John, can you talk about kind of the actions you took while you were there? And do you feel changes you've made to the processes there are going to enable more kind of reliable delivery on forecasts regardless of what those forecasts actually are? John L. Stauch - Chief Financial Officer & Executive Vice President: Yeah. I appreciate that, Shannon. I think what Randy and I are introducing, and what I took into the business and we tried to improve the discipline is there's known ways to think of project execution and working long-cycle businesses and project backlog. You start out with a shippable backlog, and then you get – you look at standard deviation and what's going to happen between being pushed out or pulled in? Customers are always going to retime you. But if you look at that over a period of time, it's always a percentage of the backlog. And what happens is people work deep in the business is they have a lot of hope in their forecast, that all, everything is going to be good and nothing bad is going to happen. And so, when you take a look at it at a high level, we just started to take out those stretches from the expectations and, really, build on the precision of what's going to get shipped out on a weekly basis. And I really think that muscle has now been developed and built within the team. And I'm very proud of what they've accomplished, as Randy mentioned. And, I think, we're going to be much more predictable as we go forward. So, that's what I would say... Randall J. Hogan - Chairman & Chief Executive Officer: I'd add in complement to you John. If you will, the algorithms, there was not great coordination between the sales forecast, the operating forecast and the materials forecast and the finance forecast. They were not – as you said, there was assumptions. But I mean, John, really streamlined that, got people talking and we have higher quality forecasts now. And this is the second quarter. I mean, we hit the fourth quarter too. John L. Stauch - Chief Financial Officer & Executive Vice President: So, we're a long way away from a perfect SIOP (40:51) process. But, I think, we're on our way to getting the expectations aligned and, therefore, not trying to have anticipated production against demand that's not needed.

Okay. No that helps. Thanks. Randall J. Hogan - Chairman & Chief Executive Officer: Thank you.

And then just a little follow-up on the stabilization in Enclosures. You talked about exiting last year down double-digits, and then getting less negative. Are we turning positive yet? Or when do you expect it to turn positive, maybe just a little bit more of the cadence to that daily sale (41:08)? Randall J. Hogan - Chairman & Chief Executive Officer: No. No. We haven't turned positive yet. And so, what we're saying is, if we stay at the level we're at when we start lapping the second half, the comps will look better, But we're not – I would call bouncing along the bottom, maybe. John L. Stauch - Chief Financial Officer & Executive Vice President: We think we get back to flattish as we exit Q3 and maybe some slight increase in Q4 Shannon.

Okay. Great. Thanks, guys. Randall J. Hogan - Chairman & Chief Executive Officer: Thank you.

Your next question comes from the line of Mike Howard from Baird. Your line is now open. Mike P. Halloran - Robert W. Baird & Co., Inc. (Broker): Morning, everyone. Randall J. Hogan - Chairman & Chief Executive Officer: Hey, Mike. Mike P. Halloran - Robert W. Baird & Co., Inc. (Broker): So, just continuing that thought process then, when you think about stabilization beyond just the Enclosures piece, are you at the point where you're starting to see a little bit more normal sequential patterns through the year? And when you get towards the back half of the year, is there any fundamental improvement embedded in some of those kind of core industrial markets or is it just following that normal sequential pattern? Randall J. Hogan - Chairman & Chief Executive Officer: Yeah. Yeah. I think we are getting back to sort of more normal expectations. I think one of the learnings for everybody is that when the Energy business spends $1 trillion a year, and goes down to $600 million a year, the knock-on effect into many other industries is pretty profound. And that's really what's I think is the core driver of a lot of the – what we call Industrial, but sort of the second order effect of the cuts in the Energy business. And so, those are getting sorted out. I mean, people are adjusting to the new reality at this new level. And so, I think we'll see more seasonality. And, as John said, we're hopeful that there'll be an increase in the fourth quarter. We typically would see a bump in the fourth quarter in Industrial so. Mike P. Halloran - Robert W. Baird & Co., Inc. (Broker): And then on the Aftermarket side, you guys talked about insourcing versus outsourcing before and…

Your next question comes from the line of Scott Graham with BMO Capital Markets. Your line is now open.

Hey. Good morning. Randall J. Hogan - Chairman & Chief Executive Officer: Hi, Scott.

This is more of a question for John. You guys are looking to do a lot in your footprint rationalization plans over the next several years. I was just wondering if you can kind of give us a little bit more on the metrics, the factories, distribution centers closed, things that are in process and what have you. I know you've said that you feel good on track there, but it's still early and – I was just wondering if you could share some more metrics with us. John L. Stauch - Chief Financial Officer & Executive Vice President: Yeah. So, to put that in perspective right now, we have 29 factories in Valves & Controls, and we have announced the closure of maybe two to three, well it is three factories. I think we're focused right now on making sure that we've got good standard work and that we've got good documentation as Lean generally requires you to do, because moving these factories is not very easy. So, I don't think we're going to announce or discuss substantial factory reductions over the next several years. I think where the big opportunity is and where Dennis is focusing is, how do we improve the linearization within a quarter of how we're shipping, how do we reduce the inefficiencies, these are all great tools that, Lean brings that tool to the table. And I think as far as the distribution in the outside service centers, we have 43 independent service centers that aren't part of a current distribution center or a customer's factory. I think the customer is going to help define that for us over the next three to four years because it's moving in-house into their operations is where we see it going because eliminating that brick and mortar in between us and them seems to be where the industry is heading. So, I can't give you specifics, but I think there's opportunities in both of those areas. But I'd say on the factory side, I wouldn't expect very many closures in the next several years. I'd talked about optimization.

Right. Fair enough. My follow-up is about the Valves & Controls split of revenues where you guys are calling that business essentially half aftermarket and MRO, and every valves company has their fair share of standard products. So, it just seems like half of the business coming from the aftermarket just seems like a pretty high number because typically when a standard valve fails, the end users essentially cuts it out and throws it in the garbage. So I'm just kind of wondering, is it possible that there are some CapEx from your customers in your aftermarket? Randall J. Hogan - Chairman & Chief Executive Officer: Look. Yeah. Let me – aftermarket, short answer. It is aftermarket in standard product because you can't tell the difference particularly if it's sold in the U.S. it is heavy distribution. If you've got a standard keystone butterfly valve, and it's sitting in stock, if it's going in to a new installation or replacement, you can't tell the difference. But it's the same selling motion. So, to be precise, we put aftermarket and standard product together in the same selling motion because there's an urgency and an intimacy that you need with the customer in order to win. And we haven't had that clearer focus on it and that will help both the aftermarket, serviced valves and the standard replacement valves. Now when you get to engineered valve, it's closer to a project selling motion. So, we'll try to be more precise.

That sounds much more specific. Thank you. Would you say the standard valve product which is essentially a cat backs item, is that maybe half of the MRO? Randall J. Hogan - Chairman & Chief Executive Officer: Well, it isn't always the CapEx, it's OpEx. The only difference between an operating expense dollar and a CapEx expense dollar is how the accounts treat it. And to me, it's money spent, and then different people control it. So you – I don't mean to be flip but the operating expenses to run a refinery, a petrochem plant, they're enormous. And a lot of it looks very much like – particularly in the standard valves side, it looks the same. So, I think a lot of people, including us, were surprised by how much the OpEx spending was impacted given that it was the CapEx that was intended to be cut, but it's a blunt weapon, and we all know all that from our own, when we have to crank down costs, it's cranking down costs. We don't differentiate when there's an urgency about it. And then we get better, right? We say we got to put more into the efficiency of the existing plants and we've already cut as many projects as we can. So – I don't mean to go down to, into the depths here but, that's all I got.

Okay. Thank you. I was just wondering, if you wouldn't mind, if I can just tack this one on. Could you tell us at all how April is looking outside of Valves & Controls? Randall J. Hogan - Chairman & Chief Executive Officer: No, we don't do that. John L. Stauch - Chief Financial Officer & Executive Vice President: I mean, it's all incorporated in our Q2 guide, Scott.

Fair enough. Thank you. Randall J. Hogan - Chairman & Chief Executive Officer: Thank you.

Your next question comes from the line of Nathan Jones with Stifel. Your line is now open. Randall J. Hogan - Chairman & Chief Executive Officer: Hey, Nathan. Nathan Jones - Stifel, Nicolaus & Co., Inc.: Good morning, everyone. Randall J. Hogan - Chairman & Chief Executive Officer: Good morning, Nathan. Nathan Jones - Stifel, Nicolaus & Co., Inc.: Let's start in Water Quality, some very nice margin expansion there. But, Randy, you also mentioned increased growth investments. Can you talk about the kind of investments that you're making there, and perhaps quantify the increased headwind. I know you're always making growth investments, but maybe the increased headwind to margins in the quarter? Randall J. Hogan - Chairman & Chief Executive Officer: Yeah. We talked a lot about investing in products which we're doing both in Residential Filtration, a lot in Food Service, which is a really attractive business, and in the pool side. But in addition to that, we're making investments on the sales coverage side on our Residential Filtration business. We moved Residential Filtration to Karl Frykman and his Water Quality team about 18 months ago. And what we want to do is we want to replicate what we've done in Pool in the Residential Filtration business. We're the largest maker of product and components for water treatment and water filtration in the world for residential. We are the largest. But we don't have the same kind of customer intimacy that we see that we have in the pool business that has turned into such a sweet business for us. We believe that Residential might have the same potential for us. So what Karl and his team has done is they're replicating the kind of coverage, direct dealer coverage on the other side of distribution in order to…

Your next question comes from the line of Josh Pokrzywinski from Buckingham Research. Your line is now open.

Hi. Good morning, guys. Randall J. Hogan - Chairman & Chief Executive Officer: Good morning, Josh.

Hey. Could you just update us, John, on what you're seeing on the price cost side and how we should think about your guys' purchase commitments or hedges and how those weigh out over the course of the year? I guess, Valves & Controls is its own animal so maybe the rest of the portfolio? John L. Stauch - Chief Financial Officer & Executive Vice President: Yeah. So, I'll hit Valves first, we said we expected roughly 4 points of price for the year and that includes standard product which is not a lot of price and then margin compression coming from the project side and I would say that that's still the right forecast. I think we hoped that that would be a little bit conservative I think right now, that's playing out to be realistic. On the rest of the portfolio, very, very modest as far as what pricing we could get across the general portfolio, areas of two-step distribution we have normal price increases, we're seeing it. But for the most part, the low inflation on material, which are recognized as material productivity is leading to a more flattish pricing environment globally.

Is that – when is that gap largest just based on the timing of purchases as you see it today? John L. Stauch - Chief Financial Officer & Executive Vice President: Yeah. I think you're seeing – in Q1, you see kind of by segment what the prices cause we break it out. And I think we expect that rate of price increases to be the – what we think for the rest of the year. But I think the inflation starts to become a little bit more on the raw material side as we move into Q3 and Q4. We're expecting some modest inflation the back half of the year, which then would lead to what does the pricing cycle look like for 2017.

Got you. And just to shift over to the Food and Bev comments – I don't remember if you guys mentioned this in the script or not, but the push outs there, are those are all getting made up in 2Q or will those filter in as we move through the balance of the year? John L. Stauch - Chief Financial Officer & Executive Vice President: Balance of the year.

Got you. All right. Thanks, guys. John L. Stauch - Chief Financial Officer & Executive Vice President: Thank you.

Your next question comes from the line of Brian Drab with William Blair. Your line is open. Brian P. Drab - William Blair & Co. LLC: Hey, good morning. I just wanted to ask about the free... Randall J. Hogan - Chairman & Chief Executive Officer: Hi, Brian. Brian P. Drab - William Blair & Co. LLC: Hey, good morning. Just wanted to ask about the free cash flow forecast. Having done about $635 million in 2015, you got the $100 million improvement in the first quarter of this year, and the target is $750 million. Just any thoughts regarding why we wouldn't see more significant year-over-year improvement as we move through the balance of 2016 given you're just – you're talking about these opportunities to further improve working capital as we move through the year. Randall J. Hogan - Chairman & Chief Executive Officer: Yeah. I think the linearity of the cash flow, first of all, great Q1 and I think the linearity looks a lot like last year. The opportunity to do better than $750 million would be incremental working capital opportunities, and right now, although we're making progress, we're not confident enough yet to say that we're going to realize those in 2016. So, it is the opportunity and now we got to get after it and make it a realized benefit in 2016. Brian P. Drab - William Blair & Co. LLC: Okay. Got it. And then could you give an update on the geographic trends that you're seeing in Water Quality. I think it was on the outlook call in December that you talked about the different geographies. You mentioned in Europe, you were seeing some strengths, but that it might be fueled largely by restocking, do you have a better sense for how much…

Your next question comes from the line of Robert Barry with Susquehanna. Your line is now open.

Hey, guys. Good morning. John L. Stauch - Chief Financial Officer & Executive Vice President: Hi, Barry. Randall J. Hogan - Chairman & Chief Executive Officer: Good morning.

So, just kind of a big picture question on the margin outlook, it's staying the same even though you came in ahead on 1Q and raised the outlook for growth in the highest-margin segment. I'd think FX would probably also be maybe a little less of a headwind. Is it that all just the kind of slight tweak to the Tech Solutions outlook, or is there anything else going on there? Randall J. Hogan - Chairman & Chief Executive Officer: Yeah. It's pretty much just Tech Solutions. And we feel good about the first quarter, it's kicked off the year well, but we're still pointing at the same commitments we made. Second quarter, we're focused on right now.

Got you. Okay. And then in FFS, just to follow up on some of the questions about the shortfall there, is that delta between the down 2% that you did and the guided 4%, is that all in the Beverage shipments or is there anything else going on in there? Randall J. Hogan - Chairman & Chief Executive Officer: Irrigation was a little worse. I would – I almost going call it like – I think we whiffed that one, I think – before we got the plans finalized, we came out with a 4% organic growth in Q1. If we take a look at 2% for the year, just put that one on me, I don't think we had ever an expectation to deliver 4%, but we apologized and we said it would be up 4%. John L. Stauch - Chief Financial Officer & Executive Vice President: So, I think we start to think the municipal ramp and all the contribution in the back half of the year. And so, we think we ramp our organic core growth as the year goes along and...

Got you. Could you actually just shed a little light on what's going on in muni? It does sound like that's an end market that's been building momentum. It sounds like it was pretty good in the quarter. John L. Stauch - Chief Financial Officer & Executive Vice President: Yeah. I think the break and fixes are starting to accelerate, and we're starting to see municipalities start to let some of those projects – and obviously not large ones, but we're seeing a market that's starting to grow 3% or 4% on a more sustained basis.

Got you. John L. Stauch - Chief Financial Officer & Executive Vice President: And globally it's still a good market as well.

Got you. And the recovery in the beverage piece in FFS, is that all in the backlog? It's just timing or... John L. Stauch - Chief Financial Officer & Executive Vice President: Yes. Yes, it is.

Got you. Randall J. Hogan - Chairman & Chief Executive Officer: Actually, they built backlog. We had a good orders quarter. So, there's still – we have a lot of newer technologies that are being applied, but it's just in a sense lumpy in terms of when they get shipped.

Got you. And as those projects come on in Food & Bev, is that mix positive or negative? John L. Stauch - Chief Financial Officer & Executive Vice President: It's slightly negative. I mean we're putting a project in. We wait for the aftermarket to pick-up on the better margin rate.

Got you. Thank you. Randall J. Hogan - Chairman & Chief Executive Officer: Okay. Thank you.

Your next question comes from the line of David Rose with Wedbush Securities. Your line is now open.

Good morning. Thank you for taking my call. Just a quick housekeeping. Can you highlight some of the biggest changes in the accruals for the quarter, and how they stack up against fourth quarter comparisons or back half-of-the-year comparisons? John L. Stauch - Chief Financial Officer & Executive Vice President: What do you mean by accruals?

Well, are there any compensation accruals or any other accruals that might change the comparisons this year versus last year in Q1 and then in the back half of the year? Just something that we should be watching? John L. Stauch - Chief Financial Officer & Executive Vice President: Yeah. The only one of note would be the incentive accrual or the compensation accruals in Q1 are generally different this year as we look at the vesting periods of directors and officers and so you can kind of see that if you take a look at a full year of 90 and roughly 30 in Q1. The rest of the quarters looks a lot more like last year from a seasonality standpoint, a little bit of a benefit in Q2.

Okay. Great. Thank you. And then last, if I may, were there any particular variances, V&C was spot on but within the different segments, was there anything that stood out from forecast as it relates to labor and materials or productivity within the either different segments? John L. Stauch - Chief Financial Officer & Executive Vice President: No.

Okay. Great. Thank you very much. John L. Stauch - Chief Financial Officer & Executive Vice President: Thank you. Randall J. Hogan - Chairman & Chief Executive Officer: One more?

Your next question comes from Joe Giordano from Cowen. Your line is open. Joseph Giordano - Cowen & Co. LLC: Hey, guys. Good morning. Thanks for taking my question. You mentioned desal in industrial water reuse in your prepared remarks. And I am trying to remember, I don't think we've talked too much about that on calls in the recent past. So what are you seeing there? Randall J. Hogan - Chairman & Chief Executive Officer: We haven't talked much about it because it's been kind of dead. Joseph Giordano - Cowen & Co. LLC: Yeah. Yeah. Randall J. Hogan - Chairman & Chief Executive Officer: I mean, we're a large supplier of subsystems for desalination projects and they, after the financial crisis, they kind of went all soft around the world. And they're getting let loose. We have some in Eastern Europe. We have some in the Middle East. And some on the industrial water reuse side, where everything is distressed, industrials don't vote, so they get curtailed on the water faster than anything and they're the ones that will be the early adopters of water reuse technologies which we have a number of different technologies applicable there. That's what we're talking about. And it's been a focus of ours. We've been trying to get more focus there. (1:04:41) Joseph Giordano - Cowen & Co. LLC: Can you maybe scale that for us? Like how big was that at its peak for you? And where is that today, those two, like maybe those two businesses in terms of just overall size? John L. Stauch - Chief Financial Officer & Executive Vice President: Probably $100-ish million and it's probably in the $20-ish million in the quarter. Joseph Giordano - Cowen & Co. LLC: Okay. Is that in the quarter or... John L. Stauch - Chief Financial Officer & Executive Vice President: No. It's probably – yeah, it's roughly just less than $20 million on a quarterly basis and the $100 million is some was annual. So, we're down 20% from peak. Joseph Giordano - Cowen & Co. LLC: Okay, okay. And then just last from me. Can you talk about the magnitude of the price pressure on the Aftermarket you've seen in V&C just on that piece of the business? John L. Stauch - Chief Financial Officer & Executive Vice President: On the standard MRO side, it's not significant on a product versus a product basis. We are seeing a mix issue in the sense that the larger markets, North America and Europe, we're down substantially in the quarter and we saw some, the fast growth markets actually pick up on the Aftermarket side and the margins are slightly lower. But on a like-to-like product, roughly, around 1% to 1.5% is all we are seeing on the pricing at the moment. Joseph Giordano - Cowen & Co. LLC: Okay. Perfect. Thanks, guys. Randall J. Hogan - Chairman & Chief Executive Officer: All right. Thank you.

All right. Steve, thanks.

You're welcome. And ladies and gentlemen, a replay of this conference call will be available within two hours. If you wish to listen to the replay, please dial 1 855 859 2056 and enter the conference ID 55576145. For international callers please dial 404 537 3406. Thank you. This concludes today's conference call. You may now disconnect.