Good morning and welcome to the Pool Corporation Fourth Quarter and Year-End 2015 Results Conference Call. All participants will be in listen-only mode. After today's presentation, there will be an opportunity to ask questions. Please note, this event is being recorded. I would now like to turn the conference over to Mark Joslin, Senior Vice President and Chief Financial Officer. Please go ahead. Mark W. Joslin - Chief Financial Officer & Senior Vice President: Thank you. Good morning, everyone, and welcome to our year-end 2015 earnings call. I would like to remind our listeners that our discussion, comments, and responses to questions today may include forward-looking statements, including management's outlook for 2016 and future periods. Actual results may differ materially from those discussed today. Information regarding the factors and variables that could cause actual results to differ materially from projected results is discussed in our 10-K, which will be updated in the next couple of weeks. At this point, I'll turn the call over to our President and CEO, Manny Perez de la Mesa. Manuel J. Perez de la Mesa - President, Chief Executive Officer & Director: Thank you, Mark, and good morning to everyone on the call. 2015 marked another strong year of performance, accentuated by a mild fall and a late winter, which helped drive sales to a very strong fourth quarter finish. On a constant currency basis, in 2015, we realized 7% sales and gross profit growth, 15% operating profit growth, and 20% diluted earnings per share growth. As stewards of the capital entrusted to us, our trailing 12 months return on invested capital was 19.6%, our cash flow from operations was 114% of net income, and we returned $140 million of capital to shareholders in the form of dividends and share repurchases. All-in-all, a strong year…

We will now begin the question-and-answer session. The first question comes from Matt Duncan of Stephens. Please go ahead.

Good morning, guys, and congrats on a great quarter and great year. Manuel J. Perez de la Mesa - President, Chief Executive Officer & Director: Thank you. Mark W. Joslin - Chief Financial Officer & Senior Vice President: Thank you, Matt.

Manny, the first question I have and I understand it's probably difficult to quantify, but you guys mentioned weather both in the press release and a few times on the call. Is there any way to look at the weather impact, what it may have been in the fourth quarter? Can you quantify how much you think it might have helped revenue? Manuel J. Perez de la Mesa - President, Chief Executive Officer & Director: You're correct in that it's hard to quantify, but I think for context, if you're looking to EPS, it's probably about $0.05 in terms of the impact. Again, it's hard to quantify and there are various factors that play into it, but we believe it's about $0.05.

Okay. Was there any discernible difference in the growth that you saw in year-round versus seasonal markets, is that may be another way to look at it? Manuel J. Perez de la Mesa - President, Chief Executive Officer & Director: No. I mean, what happened here is, first of all, in the more seasonal markets, the numbers are just a lot smaller, so therefore, when you look at those numbers, the fact that they would have been a little stronger than they were during the first three quarters of the year I think is just reflective of the fact that there were some activity versus very little to no activity. In terms of the year-round markets, they were also strong in the fourth quarter. So net-net, I mean, it was all across the board. And part of it is also the fact that the psychology was generally positive as well in terms of there was demand and people were trying to just fill that demand.

Okay. Another way to look at this maybe, if you look at the growth in the first and fourth quarters, it was north of 10%; the middle two quarters and the summer strong part of the season was a little lower. Is that maybe an indication of the strength that you're seeing in the refurbishment business, assuming that people would rather get that done in those seasonal markets and in the off season? I understand obviously the pre-buy helped a little bit, it sounds like it's going to again in the first quarter of 2016. But – and I know you laid out sort of the different growth rates between remodel and retail, but is that maybe another part of what's driving those shoulder seasons growing a little faster than the typical strong part of the year for you guys? Manuel J. Perez de la Mesa - President, Chief Executive Officer & Director: Yes. Definitely, remodel and replacement activity is strong, and to the extent that, weather permitting, that work gets done. So, that applies across the board. And that's reflected in the strong fourth quarter sales-wise, which was across the board, Sunbelt and Snowbelt.

Okay. And then last thing and I'll hop back in the queue just in terms of the revenue growth assumption within your earnings guidance. What type of revenue growth rate are you expecting at the midpoint of the earnings guidance, and how much of that is market growth versus market share? Manuel J. Perez de la Mesa - President, Chief Executive Officer & Director: We're looking at about – well, mid-single digits would be the top line growth, and we're looking at the market this year to grow maybe a shade over half of that, maybe about – weighted basis, about 3%.

Okay. All right. That helps. I appreciate it, Manny. Thank you. Manuel J. Perez de la Mesa - President, Chief Executive Officer & Director: Thank you.

The next question comes from Ken Zener of KeyBanc. Please go ahead.

Good morning, gentlemen. Manuel J. Perez de la Mesa - President, Chief Executive Officer & Director: Good morning, sir. Mark W. Joslin - Chief Financial Officer & Senior Vice President: Good morning, Ken.

Manny, you cited your awareness of macro concerns and you said you would not be unaffected by that. It sounded like it was more theoretical. But could you give us a little context for – if these headwinds develop further, could you give us context how your company might be sensitive in terms of earnings, vis-à-vis the sensitivity your company had in 2007, 2008 which you guys made some decisions that may have kind of probably exacerbated the leverage, but could you just give us a little context for if these headwinds are happening, what you would expect to see so investors could have some concept of how this cycle might treat you differently? Thank you. Manuel J. Perez de la Mesa - President, Chief Executive Officer & Director: Yeah. Sure. So, let's take the business in pieces. The basic maintenance and repair which is majority of our business, very resilient, very low growth, but very resilient and will continue to grow independent of macro environment. New construction is still extremely depressed; still down about 70% versus what it was in the peak of 2005, 2006 time period. So, I don't see that being impacted at all. So therefore, what we get to is remodeling and replacement activity. And remodeling and replacement activity domestically in the Blue side of our business is about 29% of our business and that has recovered very nicely in a very consistent basis beginning in 2011. So to that end, what happens here, and this is the pause that to the extent that anybody perceives any concerns, they could delay some of that remodeling activity or more discretionary replacement activity. And that's the area that again could slow down its level of growth. So, when you look at our overall weighted numbers, when you factor in that maintenance and repair is growing at low single digits for us, virtually nil for the industry, then what you're left with is that's the factor that's going to drive it. And again, we've seen no evidence of that to-date and you can see that in the strong fourth quarter results. So, we're just – it's out there and, again, we haven't felt anything just yet but we're cautious in that regard. And the impact to our earnings, it's factored into our guidance.

Absolutely. And I do appreciate that, Manny. Would it be – since the hardscapes, it sounds like kind of what we're talking about there, in part, where you've done some acquisitions. Would the operating leverage for any change in sales there be really different than your kind of 15%, 20% incremental EBIT that you kind of guide us to generally? Manuel J. Perez de la Mesa - President, Chief Executive Officer & Director: No, it would be very similar. And really what you're talking about is order of magnitude, so therefore what it translates to is if that grows 1% to 2% less, right, that sector, it impacts our overall sales growth by let's say 1%, well that's what you're talking about.

Thank you very much. Manuel J. Perez de la Mesa - President, Chief Executive Officer & Director: Sure.

The next question comes from David Manthey of Robert W. Baird. Please go ahead. David J. Manthey - Robert W. Baird & Co., Inc. (Broker): Hi. Good morning. Manuel J. Perez de la Mesa - President, Chief Executive Officer & Director: Good morning. David J. Manthey - Robert W. Baird & Co., Inc. (Broker): First off, Manny, in your monologue you mentioned sort of this flatness because of the installed pool base and lack of inflation in the minor maintenance and repair business. Should we assume that fourth quarter and full year were both pretty much flat in that segment? Manuel J. Perez de la Mesa - President, Chief Executive Officer & Director: Yes. They – no discernible difference there. David J. Manthey - Robert W. Baird & Co., Inc. (Broker): Okay. And then on SG&A, if you look even on a constant currency basis, if you were up 3%, and I guess some of that would be acquisition relative to a 14% EBITDA increase, you mentioned some of the incentives and technology expenses being up, offset by tight expense control. But given that your labor being the largest component of your SG&A cost stack, there must be something more than just cell phone contracts and making sure you shut the lights off at night, so... Manuel J. Perez de la Mesa - President, Chief Executive Officer & Director: By the way, we do that. We do review cell phone contracts and we do shut off the lights at night. And our warehouses, a good majority of them have automatic timers set for the lighting in the warehouse. So, we are conscious of all that and we have all sorts of agreements on trash removal and things of that nature, so we try to look for every nickel we can…

The next question comes from David Mandell of William Blair. Please go ahead. David M. Mandell - William Blair & Co. LLC: Good morning. Manuel J. Perez de la Mesa - President, Chief Executive Officer & Director: Good morning. David M. Mandell - William Blair & Co. LLC: The $0.05 you cited from the better weather in 4Q, do you think that's incremental sales and earnings, profitability? Or do you think that's $0.05 that came out of – pulled forward from first quarter of 2016? Manuel J. Perez de la Mesa - President, Chief Executive Officer & Director: Incremental. David M. Mandell - William Blair & Co. LLC: All right. And then as far as looking at 2016, on the gross margin line. What's your outlook there and what are some of the puts and takes? Manuel J. Perez de la Mesa - President, Chief Executive Officer & Director: There, David, we have two areas that are kind of going in different directions. I'll speak about the negatives first. What we have there is, from a product – and this is mainly product-mix driven, from a product mix standpoint, when you're looking at remodeling and replacement activity, those are typically bigger ticket items and by virtue of them being bigger ticket, generally speaking, the margin percents are smaller than on smaller ticket items where the cost to serve is logically much higher than the percentage of the product being sold. So, that's factor number one, kind of going against us. Factor number two going against us is that manufacturers have progressively been investing in innovation and, as a result of that innovation, providing products or developing and coming to market with new products that are either much more efficient and/or provide greater aesthetic value. In both cases, the products are…

The next question comes from David Mann of Johnson Rice. Please go ahead. David M. Mann - Johnson Rice & Co. LLC: Yes. Thank you. Good morning. Congratulations on the year and the 20 years. Manuel J. Perez de la Mesa - President, Chief Executive Officer & Director: Thank you. David M. Mann - Johnson Rice & Co. LLC: It's been fun to watch. I guess, first question, sort of along the same lines of some of these about the SG&A line is the flow-through for the year was – to EBIT was in the I think 23% range for the company and maybe 28% on the base business. I think in the past, you had – you kind of talked in the mid to higher teens as a flow-through rate. How should we think about that going forward in 2016 and beyond? Manuel J. Perez de la Mesa - President, Chief Executive Officer & Director: That's a great question, David, and I think here what impacts that is a little bit of math because of the exchange. As you know, and many on the call know, exchange cost us approximately 2% in terms of top line and certainly benefited us on the expense side, but what happens here is if you do a – on a constant currency analysis and you assume that we would have, I'll call it, round numbers, $40 million more in sales, then the improvement in terms of operating or contribution margin is inside our normal 15% to 20% range. David M. Mann - Johnson Rice & Co. LLC: Okay. Great. That's helpful. On the... Manuel J. Perez de la Mesa - President, Chief Executive Officer & Director: If I may, David, I just want to clarify something. I misspoke a second ago in answering…

The next question comes from Anthony Lebiedzinski of Sidoti & Company. Please go ahead. Anthony C. Lebiedzinski - Sidoti & Co. LLC: Yes. Good morning. Thank you for taking the questions. So, just to follow up on Texas, can you give us a sense as to what percentage of your sales was attributable to Texas last year? Manuel J. Perez de la Mesa - President, Chief Executive Officer & Director: Have to do the math here, so just bear with me a second, Anthony. Do you have another question? Anthony C. Lebiedzinski - Sidoti & Co. LLC: Not a problem. Yes, so – and if you could just give us a sense – you mentioned also, Manny, about the Oklahoma and some parts of Louisiana as well, so just wanted to see – how should we think about this kind of going forward as far as the impact of lower oil prices and some of the job losses in the energy sector? Manuel J. Perez de la Mesa - President, Chief Executive Officer & Director: Texas represents about, represented approximately 14% of our sales last year. And just for context, California is our biggest state overall, and Florida and Texas are very similar. Anthony C. Lebiedzinski - Sidoti & Co. LLC: Got it. Okay. And as far as – you had mentioned that the other portions like Oklahoma and Western Louisiana, are those significant markets for you in the big scheme of things, or how should we think about that? Manuel J. Perez de la Mesa - President, Chief Executive Officer & Director: They're not – nowhere near as significant as the first three, obviously. And even when you look at it, those are – we do business and we have locations in Lafayette, Shreveport, Longview. Now, we opened recently…

The next question comes from Garik Shmois of Longbow. Please go ahead.

Hey. Good morning, guys. This is Mark Zikeli on for Garik Shmois. Congratulations on a good year, guys. Manuel J. Perez de la Mesa - President, Chief Executive Officer & Director: Thank you.

Yeah. Just starting off, really good cash flow generation. Just wondering if you can talk a little bit about your uses of cash heading into 2016 as far as new store openings and acquisitions? Just give us a general sense of progression in the first part of the year, and how much of anything is embedded in the guidance? Manuel J. Perez de la Mesa - President, Chief Executive Officer & Director: Sure. First, use of cash is internal needs, which is both in the form of CapEx as well as working capital, CapEx being delivery fleet, IT, and leasehold improvements on facilities. In terms of working capital that's driven to support growth, both on the AR side as well as on the inventory side for existing business as well as working capital support the opening of new locations. And we have a handful of new locations targeted for this year, as we do most years. Generally speaking, new locations don't add anything to the bottom line in their first year to speak of. But it's a – basically provides us a platform for growth as we grow share in those markets over the course of time. That's number one. Number two is or are acquisitions, same methodology in terms of return on invested capital drivers that we have and everything else, or filters as we have in everything else. And to that end, that number is not going to be super material in the big picture over the course of time. Most of the acquisitions that we do are relatively small for our size, and they basically are focused on markets where we have little to no presence as a way to enter the market. And we do that and always play that off against opening our own new…

All right. Thank you for that, guys. Good luck. Manuel J. Perez de la Mesa - President, Chief Executive Officer & Director: Thank you. Mark W. Joslin - Chief Financial Officer & Senior Vice President: Thank you.

The next question comes from Brent Rakers of Thompson Research Group. Please go ahead.

Yes. Good morning. Just wanted to start on the guidance for this year. I think in a typical year, Manny or Mark, you exclude future share repurchases from that EPS guidance level, and I guess given the pretty significant buybacks year-to-date, I was wondering if that was included in that number or not? Manuel J. Perez de la Mesa - President, Chief Executive Officer & Director: Yeah. It sure was, Brent.

Okay. Great. And then, obviously, you've talked a lot about the weather dynamic in Q4, and a lot of talk has been about extending the season in some of these markets and with that comment, I was wondering how the chemicals category might have been impacted by that? Manuel J. Perez de la Mesa - President, Chief Executive Officer & Director: Chemicals are for basic pool maintenance and the chemical sector of the industry – I'll give you the industry information first, was modestly up because of the late season, but very modestly up; I'm talking about 1% to 2%. Our own chemical sales were up a little more than that and chemicals, as you can well imagine, is an important – a very important product category within our retail, the retail portion of our business.

And then, Manny, I guess any time you extend a season this way and you certainly get this much optimism among your customers, I was wondering if that was translating at all to maybe sparking some interest in new pool construction, given the longer season this year? Manuel J. Perez de la Mesa - President, Chief Executive Officer & Director: You know what, that's – I am optimistic that some of that will begin to kick in. We are still – let me then start with a positive. We began to see last year financing begin to open up where you had appraisals and banks willing to lend close to 80% loan to value on, I'll call it, current appraisal values as opposed to very conservative appraisal values when you're doing a remodeling. So, that's beginning to open up. Frankly, I believe that higher interest rates are going to help us there. As banks are able to realize a return they will be inclined to take a little bit more risk than being as selective as they have been for the past seven years where basically they have only been lending to pristine credits, whether it'd be in the commercial or consumer side.

Great. And then I guess maybe, well, two other quick questions. One, if you could maybe comment on what your outlook is for product-price inflation this year. And then secondly, you've talked a lot over the last several years about this recovery and kind of deferred remodeling-replacement spending. I think you started talking about that in 2010, 2011. Maybe wondered how far along do you think you are to reaching those original recovery goals, and maybe how much more legs is with that piece of the recovery story? Manuel J. Perez de la Mesa - President, Chief Executive Officer & Director: Sure. In terms of inflation, negligible. I think the market volatility, the energy costs being what they are, I think there is going to be negligible price increases. There is going to be a higher, I'll call it, a better mix of products from manufacturers from an innovation standpoint. But in terms of more of the commodity-type products, there'll be no inflation there to speak of. In terms of the recovery, let me just first address remodeling and replacement. And that – as I mentioned earlier, that recovery we believe began in earnest in 2011 and has continued to-date. Our expectations were that by – on a dollar-weighted basis, that sector was down almost 40% at the trough from normalized behavior. We believe that, by last year, that behavior was about 15% or so, mid-teens percent, below normalized behavior. And we believe that that recovery will continue such that probably by 2018, at the latest 2019, behavior will be back to normal. And in that, there has been some recovery component as well from some of that deferred activity. So, that's number one. In terms of new pool construction, new pool construction is still down about 70%. For that to really kick back in and really gather significant momentum, we need financing to be available for the middle of the road homeowner, from a credit standpoint. And that middle tier homeowner, single-family homeowner, is really the key target as they look to improve the quality of their home life.

Great. Thank you, Manny. Manuel J. Perez de la Mesa - President, Chief Executive Officer & Director: Thank you.

And we have a follow-up from Matt Duncan of Stephens. Please go ahead.

Yeah. Hey, guys. Just a real quick housekeeping item. It looks like you made a couple of smallish acquisitions in the quarter. Mark, what is the combined annual revenue for those two businesses? Manuel J. Perez de la Mesa - President, Chief Executive Officer & Director: About $20 million.

About $20 million. Okay. Thank you, Manny. Manuel J. Perez de la Mesa - President, Chief Executive Officer & Director: Thank you. But by the way, you can presume relatively modest, very modest, earnings contribution the first year.

Okay. Thanks.

This concludes our question-and-answer session. I would like to turn the conference back over to Manny J. Perez de la Mesa, President and CEO, for any closing remarks. Manuel J. Perez de la Mesa - President, Chief Executive Officer & Director: Thank you, Andrew, and thank you, all, for listening. Our next conference call is scheduled for April 21, mark your calendars, when we will discuss our first quarter 2016 results. Have a great day. Thank you.