Thank you for holding, and welcome to Rockwell Automation's Quarterly Conference Call. I need to remind everyone that today's conference call is being recorded. [Operator Instructions] At this time, I would like to turn the call over to Rondi Rohr-Dralle, Vice President of Investor Relations. Ms. Rohr-Dralle, please go ahead.

Thanks, Deanna. Good morning. Thank you for joining us for Rockwell Automation's Second Quarter Fiscal 2012 Earnings Release Conference Call. Our results were released this morning, and the press release and charts have been posted to our website at www.rockwellautomation.com. Please note that both the press release and charts include reconciliations to non-GAAP measures. Additionally, a webcast of this call is accessible at that website and will be available for replay for the next 30 days. With me today as always are Keith Nosbusch; our Chairman and CEO; and Ted Crandall, our Chief Financial Officer. Our agenda includes opening remarks by Keith that will include highlights on the company's performance in the second quarter and the first half of the fiscal year, as well as some full year outlook commentary. Then Ted will provide more details around the second quarter and our guidance for fiscal 2012, and we'll take questions at the end of Ted's remarks. We know it's been a busy earnings week for all of you, so we appreciate you dialing in today. We expect the call to take about an hour, maybe a little bit less. As is always the case on these calls, I need to remind you that our comments will 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. Our actual results may differ materially from our forecasted projections due to a wide range of risks and uncertainties that are described in our earnings release and detailed in all of our SEC filings. So with that, I'll hand over the call to Keith.

Thanks, Rondi. Good morning, everyone, and thank you for joining us on the call today. I appreciate your time and interest in Rockwell Automation. The first portion of my remarks will cover some highlights for the quarter and a summary of our performance in the first half of the year. Please turn to Page 4 in the slide deck. We had solid 8% growth excluding currency in Q2 and 7% organic growth. I was really pleased to see solid organic growth in every region. North American market conditions have remained healthy. Our reported sales growth in the U.S. was 5% this quarter. But because of an unusually large project that shipped in quarter 2 last year, we believe that understates the strength of market conditions in the U.S. If we carved that large project out, growth in the U.S. would have been several points higher. Canada was a standout with 25% growth. We are successfully capitalizing on the strength of resource-based industries there. Europe had another strong quarter despite macroeconomic headwinds. Our team there is executing very well in a difficult environment. I was encouraged to see Asia return to double-digit growth in the quarter. China improved to high single-digit growth, and we are optimistic that market conditions will continue to improve in the second half of the year. Our outlook for India is more cautious. Sales in India were flat in the quarter, and we have yet to see evidence of improvement in the economy. Lastly, while Latin America organic sales were only up 4% in the quarter, they have difficult comparison to a great quarter last year. Orders were strong in the quarter, and we continue to expect double-digit growth for the full year. I hope that regional color was helpful. I have a few other second quarter…

Thanks, Keith, and good morning to everybody out there. I'll be referencing the slides on the website, and I'll start with Slide #5, which is titled Second Quarter Results: Summary. Revenue in the quarter was $1,561,000,000, up 7% compared to the second quarter of last year. The year-over-year impact of currency fluctuations reduced sales by about 1 point, and the contribution from acquisitions increased sales by about 1 point. Segment operating earnings were $268 million, an increase of 10% compared to a year ago. General corporate net was $25.1 million compared to $20.5 million in Q2 last year. The increase was due to a $7 million legacy environmental charge related to former Rockwell International sites. The effective tax rate in the quarter was 24.9%. Diluted earnings per share was $1.16, up a bit from last year. While we had a reasonable increase in segment operating earnings, the combination of our legacy environmental charge and a higher tax rate reduced EPS by about $0.13. Average diluted shares outstanding in the quarter was 144.7 million, and during the quarter, we repurchased approximately 508,000 shares at a cost of about $41 million. Moving to Slide 6. This is the total company results for the second quarter. As I noted on the prior slide, the year-over-year increase in sales for Q2 was 7%. Sales increased by 6% sequentially. On the right side of the slide, segment operating earnings were $268 million, up 10% compared to Q2 last year, with segment operating margin at 17.2%, up by 0.5 point from last year. The year-over-year margin expansion is due primarily to volume leverage and a favorable contribution from price, partly offset by increased spending. It's a similar year-over-year margin causal in both segments. Sequentially, operating earnings declined by about 5%, and segment operating margin was 2…

Great. Thanks, Ted. [Operator Instructions] So Deanna, let's take our first question.

[Operator Instructions] The first question comes from the line of Rich Kwas, Wells Fargo.

Ted, on incrementals. Just when you look at on year-over-year basis, a little bit below our expectations. And I just was thinking of it in terms of commodity headwind, that was pretty significant last year at this time, and you put through price as the year went on. What was the spread on price cost in the quarter? And did that have any positive benefit on margin year-over-year?

Well, I think on commodity costs, we are running a little bit higher than a year ago but not outside our expectations and, I'd say, consistent with our original guidance. On price, we said we thought we would realize about 1 point, maybe a little bit less. And I would say, through the first half, we're very much on track with that. So I think price cost through the first half and in the second quarter was pretty much as we expected.

Okay. And then just a quick follow-up on the mix with Solutions. I think you had raised that last quarter to 2 to 3 points incremental versus 1 point in the original guidance. Where are you now within the guidance for Solutions mix?

Yes. I think what we have seen through the first half and with what we've got in backlog now, it looks like Solutions growth is even going to be a little bit better than we originally thought, and Product growth just may be slightly lower than we originally thought. So that 3-point difference has now become a several-point difference.

And the next question comes from the line of Shannon O'Callaghan, Nomura Securities.

So interested in the pickup again in Asia-Pac and in China. Can you talk a little bit about how you saw that progress through the quarter and exiting the quarter?

Absolutely. We -- with respect to the trend in the quarter, it definitely got stronger. I think there's probably 2 reasons for that. One is, as we talked last time, there was the impact of liquidity, particularly on small and midsized customers, and China has been easing their reserve ratio in the period. But then second is just the holiday in Asia, with the Chinese New Year occurring generally a little -- in the early part of the quarter, that as we exited, we saw a stronger momentum building as we went through March. And March was very solid, which, I think, drove a lot of the performance that we talked about, improvement on a sequential basis from Q1. But I would say those 2 things with growing momentum as we exited the quarter.

Okay, great. And then just maybe, Ted, on the incremental. So I understand that the components in 2Q, obviously, I think hit a little bit more than we thought. We all knew they were coming down from 57, came down a little more. As you think about the back half, I mean, to work towards the higher end, it looks like they have to get a little better again. So can you maybe talk about the dynamics heading into 3Q, 4Q from an incremental standpoint?

Yes. I mean, I think if you look at the implied incrementals for the full year now, we're kind of in the mid to high 30s. And given where we had been in the first half, that would put the second half in that same -- the high-30s range. So we're pretty comfortable with that given our expectations for volume growth in the second half, but we are going to have some headwind from mix in the second half.

So I mean -- I guess relative to this quarter, what would be the key things that are not as much pressure on the 3Q, 4Q incrementals?

Well, I think, there's going to be a contribution from volume compared to this quarter, a little bit of headwind from mix, and then there's just some other noise kind of stuff that affects quarter-to-quarter results. And when you do the conversion, you've also got the complication of what was going on in the quarter the prior year before.

Okay. So basically, no change to kind of thinking 35-plus or something on incrementals?

I think that's right.

And the next question comes from the line of Winnie Clark, UBS.

First of all, just quickly on end market color. Could you give us an update on what you're seeing by end market? I know transportation has been a bright spot. Does that continue to be the case? And you talked about some acceleration expected in Process end markets as well.

Sure. Let me comment on a couple of the end markets. You hit the first one, which was auto. And certainly, we felt auto was strong in the quarter, and we continue to believe that, that will help us as we go through the year. Associated with that would be tire. Tire has been a very strong market over the last, probably, 12 to 18 months now. While we're not seeing the growth there, tire is continuing to stay at the high level with just a little bit of shift of where and who's doing the investing, but the market itself continues to perform well. Oil and gas is strong pretty much across the board, and that is pretty much a continuation. Water wastewater, strong in the U.S. Mining, strong in Latin America, Canada and the South Africa, Middle East region for us, with respect to EMEA. The consumer products, consumer is a little bit mixed. When you look at it in total, the food and beverage market, a lot of the investment there is primarily in emerging markets as we go forward. Life sciences becoming a little stronger in EMEA. And then the one that's probably a little weaker within consumer is the home and personal care market at this point in time. So that gives you a little feel for the different end markets.

Okay, great. And then just within EMEA. Can you talk about, within the different areas, what you're seeing there specifically? And you talked about the export market is strong last quarter. Is that something you're still seeing?

Yes, yes. Within EMEA, we see a continuation of what you just mentioned we talked about in Q1, and that is the strength of the exporting sector. I think the strength of the exporting sector is starting to diverge a little. And that is continued strong exports back into the U.S. but a little weakening of exports into Asia because of some of the slowdowns that were taking place there, so a little difference as we see that happening at the moment. Then we also have the phenomenon between north and south, I'll call it, Western Europe, if you will. The continuing debt crisis in the south impacting a little bit stronger into Spain and Italy now, and the north being more of the exporting region goes back to my earlier comments. And then the last point I'd make with respect to Europe would be that emerging aspects, which, for us, would be areas like Russia and Turkey, they continue to perform well in the second quarter, equally strong -- almost equally as strong as they were in our first quarter. So we see continued growth there, and then the Western Europe would be back to the earlier comments I made.

And the next question comes from the line of Terry Darling, Goldman Sachs.

So I wonder if you could just elaborate a little bit or clarify -- it sounds like you're looking on organic for a little bit of an acceleration in the second half versus where we've been here. And I'm taking it -- from that, Ted, your comments in response to Shannon's question, but also this idea that the U.S. was impacted by comps here in the March quarter. But -- I mean, if you could just flesh that out a little bit more.

Well, I would say, on an x currency basis, on a year-over-year basis, the current guidance would call for growth about equal in the second half to the first half. And there's probably not enough acquisition impact in either half to affect that much, so think of that as organic.

Okay. And so what -- just the offset then in the context of a flatter -- so U.S. you're saying tough comp in the first quarter but something else decelerates in that mix. In other words, you’ve talked about EM getting better in the second half. That's pretty clear. So to offset that, you'd have to have a slowing in DM, and maybe that’s Europe, but...

Well, I think that's exactly the case, Terry. I'm sorry. I didn't understand your question from a regional point of view. I mean, we do expect strong growth rates in the emerging market in the second half, and we do expect lower growth rates in the mature markets. But that's kind of what we've been talking about for a while in terms of a continuing deceleration in the mature markets as the -- just as the cycle continues to play out.

Okay. And then on your point with regards to margins and certain things happening in given quarters, I mean, just on CPS margins, that's really where the weakness was on our look of things. I guess it was our thought that you had very easy comps because of all the impact from material pressures and Japan supply chain issues last year. So is it really just mix going on here? Or are you seeing some pricing pressure there? I know you talked about 1 point, and that's in line. But you raised some prices in, I think, August or September that was likely to drive a better year-over-year comp, at least in the first half of the year. What else is going on at CP&S, given how easy that comp was that you didn't have a little bit stronger incremental than 15% year-over-year?

Well, I would say we got a reasonable contribution from the volume. We've got the favorable contribution for price we were expecting. And actually, I talked about being a little under 1 point. It wasn't a lot -- it wasn't much different in either of the segments. There's a negative mix impact in CP&S year-over-year, and that's basically higher Solutions growth. And we've got the spending impact that we have talked about in both segments year-over-year.

And did you call that mix effect a 3-point impact? That's a revenue impact, presumably. But can you clarify how much that mix impact was?

Well, it would have been less than 0.5 point of margin year-over-year.

Okay. And then just lastly, continue to sit on very strong balance sheet. Buyback has been slower in the first half of the year than the pace from last year. Are you looking to step up buyback in the second half of the fiscal year?

Yes. I would say yes. I mean, obviously, our repurchases in any period are going to depend on the cash generation and what's going on with acquisition spending. But if you look at our expectations for cash flow generation this year and you back out some reasonable estimate of acquisition spending, we would expect to probably repurchase about 3 million shares this year. Obviously, we have not been at that pace in the first half. Partly in the first quarter, we stepped back a little bit because of the large pension contribution. I would say in Q2, we got a little bit of a slow start in January under a 10b5-1 plan. But our repurchases did accelerate through February and March, and we would expect to kind of be on pace through the rest of the year to get to that roughly $3 million number -- 3 million share number, I'm sorry.

Is that 3 million, Ted, is that net or gross of issuance-related options and so forth?

That's gross.

And the next question comes from the line of Julian Mitchell, Crédit Suisse. Julian Mitchell - Crédit Suisse AG, Research Division: Yes. My first question, I guess, on the -- just the margin outlook. If you're looking at your gross -- let's start with, I guess, CP&S or incremental margins or your operating margins. The operating margins there have been, I guess, around 11% last year, tracking at about 11.5% this year. Last cycle, they -- operating margins, they got up to towards mid-teens. I guess is there anything this cycle versus previous that you think will cap the operating margins in that business for the next sort of couple of years that would stop you getting back to that prior peak growth rate before, let's say, 2014?

I don't think I would characterize it as something that's going to cap the margins. But we do have some headwind this cycle, particularly in CP&S, compared to last cycle. Part of that is an increasing Solutions content as a percent of the total, so we've got that mix headwind we have talked about previously. And the other thing I think we’ve talked about previously is we've got substantially higher pension expense this cycle than we had last cycle. And because CP&S tends to be our more people-intensive business, it has somewhat of a disproportionate impact in that segment. Julian Mitchell - Crédit Suisse AG, Research Division: Okay. And then just on your sort of developed market growth assumptions for the second half year-on-year. I think you've said a couple of times that, that would -- that growth rate would decelerate year-on-year in the second half compared to what you delivered in the first half. But it sounds like the U.S. may be a little bit better because of easier comps. So what sort of growth rate are you expecting for EMEA in the second half? Is that a very big step down year-on-year?

Yes. I mean, I would say we're thinking that -- and it'll vary across our sales guidance range, obviously. But at the midpoint of the range, we're thinking the second half on an apples-to-apples basis, excluding acquisition impact, might be maybe 3 points lower than the first half.

The next question comes from the line of Scott Davis, Barclays.

Want to get a sense -- your Process business continues to be strong. And a couple of questions here. I mean, first, how much of that is -- when you think of it being up 20%, I mean, how much of that is business you're going in with partnership and with Endress+Hauser? I mean, kind of how big of a help is that? And then I have a follow-on on that as well.

Sure. Well, certainly, it's hard for me to say exactly how much of a help that is. But it certainly is part of the broader strategy of a -- of our Process strategy, which is we can supply a complete integrated solution, including instrumentation, when that's the way the customer wants to purchase it and to do that from an ability to provide the integration services, the maintenance services, the asset management associated with that equipment and to provide a more seamless startup for our customers. So it's part of the Process strategy. In some customers, E&H has a strong position. In some customers, Rockwell has a stronger position, and we help each other. And then we target other customers where we just want to break into that market. So it's -- I just view it as it's a good partnership, and we help each other in growing our mutual business at our common customers.

Okay, understand. One of the things I think we're trying to figure out, if you -- byproduct of low natural gas prices, of course, we’ve got a bunch of ethylene crackers that are coming into the U.S. and other pretty large chemical projects as well. Are you guys kind of ready to step into some of these big projects or have credibility in the market to step into some of these projects and take a much larger role, as like a master automation contract or that type of thing? Or how do you kind of see that playing out?

Well, I think as far as being able to be a Main Automation Contractor, or a MAC, as you referred, we do that in a number of industries and a number of applications. And we've done that now for, certainly, over the last year or 2, particularly more outside the U.S. because, obviously, as you well know, that's where most of the greenfield and expansion had been going, particularly in the oil and gas industries. Your comments about, and specifically, to the U.S. and the expansion into large-scale chemical complexes, I would say that is one of the places that is not Rockwell Automation's sweet spot. That is very similar to what we talk about in the oil and gas segment, being refining, the bulk chemical projects. The majority of our applications there and where we do have and where we are capable and will participate is in the intelligent motor control aspects of that business, with our medium-voltage drives and motor control centers and our safety systems from a process standpoint. And there, we will become a significant participant and to work with the companies that are starting that up, that are talking about those new facilities. But when you look at the main process control, that is an area that while we have capabilities, that would not be our historical strength and, certainly, is an area that we will participate in. In the areas that I talked about, as well as our advanced process control, which is an area that we have worked with all of these companies globally on, in particular outside the U.S., and advanced process control is a capability that we do have where we're talking about reduction of process variability and improving the control of the -- of those core chemical processes with some very sophisticated modeling technologies and capabilities. So different pieces, absolutely. And we're aware of those expansions that you've referenced.

And the next question comes from the line of Steven Winoker, Sanford Bernstein. Steven E. Winoker - Sanford C. Bernstein & Co., LLC., Research Division: Just first question on Logix and integrated architecture and the penetration rates that you're achieving. If you think about just sizing that now, I know it's not just a quarterly issue, but can you give us a little more color and flavor for that penetration and the size of the business in terms of how you see that -- playing out to the rest of the year so that we're not -- I’m not just focused only on the cycle but trying to think about your penetration share gains?

Yes. Well, certainly, let's take the near-end look, and that's for the remainder of the year. We would expect Logix to grow at a growth rate above the company average, and that's certainly what we're planning on. With respect to penetration, that's a larger -- well, let me just -- and we expect to see really solid high single, low double-digit growth rate for the year in Logix. As far as the penetration, we continue to expand the opportunities for Logix. So we have not -- and when I say that, I mean, we're expanding the served market for Logix, and that's what I talked about the new 2 controllers that came out. That's expanding the market that we have had -- that we cover going into OEMs, going in the process, the addition of safety, the addition of broader Ethernet capabilities, all of this is expanding the scalability and, therefore, the served market for Logix. So our penetration -- in one way, you can say it keeps going down because we keep expanding the market. So we believe we still have runway to grow Logix as we go forward, and certainly, that's one of the reasons we continue to invest in it, to be able to continue to expand the served market and, therefore, be able to continue to drive that higher growth that I talked about. And this year, for the first time, we expect Logix sales to be over $1 billion. So -- and we see no reason we can't continue to grow that above the company average into the -- certainly, the short and midterm future. Steven E. Winoker - Sanford C. Bernstein & Co., LLC., Research Division: And would you say -- how big a deal is the integrator network overall in terms of -- as a growth limiter to your ability to drive this? And how much investment -- or how does that relate to your investment, particularly overseas, in building that out?

Yes. Well, the fact of the matter is it's not our investment to build it out, other than the people that we have on staffs to grow the relationships, because these are independent third-party companies that create the integrator network. So ours is creating the relationships and building the interfaces and the day-to-day interaction with our sales and/or channel management teams. And certainly, we don't see it as a limitation from the standpoint of we continually grow and develop it. And we talk about it, particular in Process, one of the reasons we are growing at the rate we are is that we continue to expand the integrator network, and to your point, very much so in the emerging markets. And I think the challenge is more of finding competent, talented integrators in some of the emerging markets that can support the technology and have the domain expertise to grow into some of these new markets. So I think it's more the availability issue and having the competence to continue to expand. But we are constantly evolving and growing that partner network throughout the world. Steven E. Winoker - Sanford C. Bernstein & Co., LLC., Research Division: Well, you haven't changed your approach in terms of either funding -- finding promising folks who aren't system integrators yet and putting them in the business so that they can help drive your growth. I'm just trying to get a sense on the emerging market side of how big a limiter or not this is.

No, I don't -- we don't see it as a limiter, and we operate in 2 dimensions here. One is, if you notice some of the acquisitions we've made have been system integrators in the emerging markets so that we can get a critical mass with domain expertise. But at the same time, we're expanding the partner network so that we can work with more customers. Because at the end of the day, it's the customer that decides how they want to work here. Do they want to work with a local integrator? Or do they want to work with a Rockwell Automation who can probably provide more commonality, more standardization globally than a local system integrator could. So we try to look at that as the best of both worlds and how do we balance the growth of local integrators versus continuing to expand our solutions capability and domain expertise in the emerging markets.

The next question comes from the line of Nigel Coe, Morgan Stanley.

Yes. So, Keith, you talked about the divergence between CPS and A&S growth rates to several points. And I'm just wondering, is this a temporary divergence? Or are we now at the phase of the cycle where large projects are going to be the primary driver of your top line growth?

No, we don't -- back to where we are in the cycle, we think we're still in a -- in the part of the cycle where we should see growth in both our Product businesses and our Solutions businesses. I think the gap that we talked about is mainly because of the -- excuse me, the slow start we had, particularly in Asia in emerging markets in our first quarter and the hole we dug with the expanded shipments we had in our fourth quarter last year. And as we rebuild that pipeline with orders, we're just seeing that order flow now come through in the second half of the year. So we're seeing some moderating in Product, but a normal expansion in our Solutions business. And we don't see that as an indication at this point yet of a movement towards end-of-cycle large projects in heavy industries. But the other part of that is, we're naturally growing our Process business. So we are seeing some of that as just the -- as far as just the natural evolution of our strategy as we go forward. So we would expect more larger projects, more in the heavy industries, particularly in the emerging markets, and some of that is just the natural evolution following our growth and performance strategy. And yet, for the remainder of the year, we still expect above-market growth in both Products and Solutions.

Okay. No, that's helpful. And then coming back to the U.S. "manufacturing renaissance." It's not just the chemical and crackers. We're also seeing some tire manufacturing relocations. We're seeing some heavy manufacturing expansions. Are you starting to see that in your numbers right now? Are you starting to see that in your order flow? Or is that to come in 2013 and beyond?

Well, we -- I would say we're not seeing that in our business at this point in time. We're starting to have the anecdotal commentary as we do our normal quarterly pulse check. I would say the U.S. organization would tell us that they're having conversations, that people are bringing it up. But we're not seeing a mass change of direction here going forward. But certainly, the topic and the interest in manufacturing in the U.S. has picked up. And I think that's good, not just for Rockwell Automation but also just for the economy in general. So conversation at this point, we would expect to -- if there is going to be an impact, that's a little longer term as far as an investment cycle that it would bring with it.

Okay. And then just one more quick one, if I may. You mentioned the prior second quarter 2011, you had a particularly large project, which I'm assuming is within CPS. Would you describe that as a particularly profitable project? Because it looked like your margins in the prior quarter were somewhat higher than they might otherwise have been.

No. I would not qualify that one as a -- I think it's what we would call it to be the average of our Solutions business for us, not one that was particularly strong. So I don't think that's had any impact into year-over-year performance.

And the next question comes from the line of Jeff Sprague, Vertical Research.

Just a couple of things, if I could. Just first back to China. Keith, if you said it, I missed it. Could you just tell us what China actually did in the quarter on a standalone basis? And then more importantly, I was just interested in your view on what you're seeing change to kind of bolster your outlook in the second half of the year? What end markets, what type of activity is driving that?

Yes. Well, first of all, I did not mention it, but China grew at 7% for us this year -- this quarter. I'm sorry, this quarter, excuse me. And that was up from negative growth last quarter. What are we seeing that's different? Well, I think a couple of things. First, our team there is doing a very good job at uncovering new customers and new applications. And that does take a little bit of time, and that's why sometimes you get a dwell period, particularly when the economy is slowing. And we have seen that in China, and I think all of the statistics point to that, which is something that you've seen. As where are we seeing this now? I think we're starting to see some of the liquidity problems working their way through the system. We would hope that, that is going to be a continuing theme as we go through the year, which is why we believe the uptake will come up. And we see a split, really, between large customers and smaller customers yet. The larger companies are getting stronger and investing more. And we still see some of the pain at those smaller customers at this point, and that's really driven because of the liquidity problems that I talked about. The other reason we think we're going to see a better second half is our front-log activity has picked up, and that really goes back to the earlier comment I made about our sales organization is working very aggressively. We believe OEMs continue to be strong for us. To be able to create new OEMs, it takes time to work with them in the design phase and the design cycle. So we're expecting a pickup with OEMs as we go forward. And just the ongoing maturity of our distributors and our system integrators will help and should always help provide some tailwind as well. But that's a -- that's also a long-term process for us as well. So I think those would be the thoughts that we have with respect to China, both current, and why we feel we will expect to see an acceleration in the second half.

Just one additional point on that. Clearly, a lot of what you said is about making your own luck. I guess the liquidity stuff is more a macro comment. How much of this do you think is you driving the business versus some genuine improvement in the underlying business and market conditions there?

Well, I think if you look at the underlying market conditions, they continue to be mixed. If you look at the PMI, depending upon which one you look at, the third-party one, which tends to be most of the multinationals, is still under 50% and has been under 50% for, I think, maybe 6 or more months now. So that tells you that manufacturing is slowing. If you look at the data that they communicate, they just recently lowered their growth rates another 0.5 point. And so their exports have been impacted to some degree. So I would say the majority of our success has been us working it as opposed to the continued growth or -- at a high level of -- while the growth rates are still strong, they're declining from where they were. So it isn't like the overall business is pulling us along with it. I think we're having to work harder, and we're having to create more of our opportunities and grow more customers. And that's why I'm complimenting our team in China because it's -- while it might have been stronger market growth previously, we have certainly strong growth, but our performance, I think, indicates that the team is outperforming the underlying market there as well.

Yes, that's impressive. Just one other quick thing for me, and I'll jump off. Is there any color or anything you could share on just the state of distribution in the U.S.? Are distributors destocking, restocking? Just kind of where their head is around just kind of a general tone of activity in the U.S. market.

Jeff, this is Ted. I think you know we've got pretty good visibility of North American distributor inventories. And I would say, nothing unusual going on in their inventories. They have increased proportionate to kind of what they're seeing as end demand increase. And if you look kind of at the underlying product sales in Q2 in North America, it was another very good quarter for our distributors.

And the final question will come from the line of Richard Eastman, Robert W. Baird. Richard C. Eastman - Robert W. Baird & Co. Incorporated, Research Division: Keith, could you just speak for a second to maybe the mix within the A&S business? Can you -- looking at the core growth rate of about 8%, was the Process & Software piece up more? Is that where the mix impact came versus the peripheral Products business?

I think around -- Logix was slightly higher than the average. And I would say, last time, we talked a little bit -- last year at this time, we talked about motion being much stronger, and that was the inner segment mix difference at that point. But motion would have grown this year slightly under the segment average. So really, it was a pretty tight band within A&S this quarter, not a big swing between the different businesses within there. Good, solid safety growth. Obviously, solid Logix growth. And the peripheral products, which would be motion -- really motion and sensing, motion slightly under and sensing basically right at.

Rick, in the year-over-year causal, margin causal on A&S, there really wasn't much of a -- there wasn't much of a significant mix impact. Richard C. Eastman - Robert W. Baird & Co. Incorporated, Research Division: Okay. So in the 80 bps improvement, that's not necessarily mix. It's more volume and leverage?

Correct.

Yes. Richard C. Eastman - Robert W. Baird & Co. Incorporated, Research Division: Okay. And then could I just ask in terms of the orders on the Solutions piece of CP&S, was order growth -- how did that look in the quarter?

The book to bill was 1.1 in the quarter. So once again, 2 very good quarters of above 1 growth in our Solutions business, which is why, basically, Ted commented about the second half and the mix shift favoring more to Solutions. It's because of that backlog that we built after getting ourselves to hold in the third and fourth quarter of last year. Richard C. Eastman - Robert W. Baird & Co. Incorporated, Research Division: I understand. And then just as a related question. I’m going to relate this just so I can sneak it in. But the growth investment in the second quarter, we had talked in the first quarter that you basically delayed some of the first quarter growth investment. Did -- if you look at that, the growth investment that you made in the second quarter, does that kind of true up your year-to-date investments? In other words, was it heavier in the second quarter since we kind of delayed the first quarter investment?

Well, there were 2 things. When we talk about spending Q1 to Q2, so sequential change, probably the largest impact was just the merit increases that we normally put through in January. There was additional incremental spending increase sequentially beyond that. I don't think I would say we caught up year-to-date from some under-spending in Q1. If anything, we're probably still a little bit below where we thought we would be for the first half.

Okay. Thanks, everyone, for joining us today. That's going to conclude today's call. I'm available for follow-up calls, and so thank you again.

And that concludes today's conference. At this time, you may disconnect. Thank you.