Good day and welcome to the TriMas Fourth Quarter and Full Year 2015 Earnings Conference Call. Today's conference is being recorded. At this time, I would like to turn the conference over to Sherry Lauderback. Please go ahead, ma'am. Sherry Lauderback - Vice President-Investor Relations & Communications: Thank you and welcome to the TriMas Corporation's fourth quarter and full year 2015 earnings call. Participating on the call today are Dave Wathen, TriMas's President and CEO; and Bob Zalupski, our Chief Financial Officer. Dave and Bob will review TriMas's fourth quarter and full year 2015 results, as well as provide details on our 2016 outlook. After our prepared remarks, we'll open the call to your questions. In order to assist with the review of our results, we have included the press release and PowerPoint presentation on our company website at www.trimascorp.com, under the Investors section. In addition, a replay of this call will be available later today by calling 888-203-1112 with a replay code of 4461698. Before we get started, I would like to remind everyone that our comments today, which are intended to supplement your understanding of TriMas, may contain forward-looking statements that are inherently subject to a number of risks and uncertainties. Please refer to our Form 10-K for a list of factors that could cause our results to differ from those anticipated in any such forward-looking statements. Also, we undertake no obligation to publicly update or revise any forward-looking statements, except as required by law. We would also direct your attention to our website where considerably more information may be found. I would also like to refer you to the appendix in our press release issued this morning or included as a part of this presentation, which is available on our website for the reconciliations between GAAP and…

Thanks, Dave. I will begin my comments by providing a brief summary of our fourth quarter results beginning on slide nine. As Dave mentioned, we experienced incremental top-line pressure during the quarter related to macroeconomic uncertainty and weakness in our industrial end markets, in addition to the ongoing impact of continued low oil prices in our energy-facing businesses. We reported fourth quarter sales of $193 million, a decrease of nearly 14% compared to the prior year due to the following: an approximate $27 million sales decline as a result of low levels of oil related activity and more recently, the reduction of CapEx spend by certain of our downstream customers; a $10 million decline in industrial product sale within Packaging and Engineered Components as a result of overall end market weakness; and finally, a $2.4 million impact related to unfavorable currency exchange. Organic growth, primarily in our Aerospace business and approximately $6 million of sales growth from acquisitions, only partially offset the impact of these macroeconomic challenges. As a result of these sales declines and the related lower fixed cost absorption, operating profit for the quarter was $22 million or 11.4% of sales, representing 120 basis point decline compared to Q4 2014. Year-over-year improvements in our Aerospace business, as well as a reduction in corporate expense due primarily to lower incentive compensation attainment, helped to mitigate the impact of lower sales. We also benefited in the quarter from a $1.4 million insurance recovery related to a previously settled legal claim and an incremental year-over-year currency transaction gains of $0.9 million. While we experienced more intense top line pressure than expected entering the quarter, these items, together with the implementation of our financial improvement plan and related cost out actions, enabled us to achieve a fourth quarter diluted EPS of $0.29…

Thank you, Dave. Slide 20 provides some additional assumptions for 2016. We expect interest expense to increase to $14 million to $16 million in 2016 due to slightly higher interest rates as a result of having hedged the majority of our variable rate term debt beginning July 2016. We remain committed to growing our higher margin Packaging and Aerospace businesses, and accordingly, are planning capital investments approximating 4% to 5% of sales. These investments include adding additional low cost country capacity in Packaging to grow with and serve our global customers more effectively, as well as increasing the flexibility and level of capacity in our cylinder business to better capitalize on our North American market position. We will continue to invest in tax planning strategies, but for now, we are planning an effective tax rate of 31 to 33%, as forecasted income is expected to be more heavily weighted in United States in 2016. And finally, we expect corporate cash expense to be approximately 3% of sales meeting our longer term financial target. However, the non-cash stock compensation component will increase in 2016 as a result of resetting to the target award levels. In 2014 and 2015, stock compensation expense was lower as a result of lower attainment on the performance-based portion of the equity awards. While this amount is reported as a corporate expense, given the plan metrics are based on consolidated TriMas results, it includes the long-term compensation amount for all eligible business unit and corporate office employees. Moving to slide 21, it provides a preliminary view of our Q1 2016 earnings expectations. The external environment has changed significantly from the first quarter of 2015 when oil was still in the range of $40 to $50 per barrel, industrial markets were much stronger and our Aerospace business was…

And we'll take our first question from Andy Casey with Wells Fargo Securities.

Thanks. Good morning, everybody. Sherry Lauderback - Vice President-Investor Relations & Communications: Good morning, Andy.

Good morning, Andy.

Just a few questions on the guidance and then one on Energy. On the Q1 guidance, you talked about the continuation of Q4 trends. I'm kind of trying to understand that comment. First, do you think your end markets are seeing incremental demand deterioration, or do you expect them to be kind of sequentially stable and you're just comping against kind of a difficult period in Q1 last year?

I think that's exactly right, Andy. In the main, we expect the sales level to be reasonably consistent. There's a couple of areas where we expect to see some modest growth due to what I'd call normal uptick as a result of seasonality, seasonality moving from Q4 to Q1.

Okay. Thanks Bob.

Largely sticking in that same level.

Okay. And then on the 2016 – if I look at the bottom line, Q1 is expected to be below the average contribution, somewhere around to 18% versus the three-year average before that of about 22%. And then you have the overall guidance. Part of that is pretty obviously related to the incremental savings benefits, but are you building in any end market improvement after Q1? Meaning, is there any anticipation that second half gets better? David M. Wathen - President, Chief Executive Officer & Director: I would not call it market improvement in the general sense. We know specific programs, for example, in Packaging, for example in Aerospace where there's a platform where the line rate's going up and we know our content. So it's more us understanding the model of our own businesses. We're running on, with my opinion that, we don't expect any kind of a general market uptick. I'd love it, but it's hard to find indicators in that. And so it comes down more to understanding specific programs we've got and we'd make again when the volume hits, et cetera.

Okay. Thanks, Dave. And then within Energy, you mentioned a charge for the inability to collect receivables from some customers, and obviously that end market is kind of in some distress, but what actions are you taking, if any, to prevent recurring to that? It doesn't sound like the market's going to get appreciably better as you kind of just alluded to.

You're exactly right, Andy. This has been on the radar screen for a while now. And in one instance, we had a customer that ultimately declared bankruptcy. So even – despite the actions we took there in the period leading up to that bankruptcy, we nonetheless had a charge we needed to take to preserve that account. I think on a go-forward basis it's clearly a matter of keeping after customer collections in a very meaningful way. And then also for customers who slip at all and they're ageing, reassessing their credit worthiness and adjusting terms. And to the extent necessary, we'll go to cash on delivery if we believe there's significant risk associated with the given customer. David M. Wathen - President, Chief Executive Officer & Director: Yeah. A management comment would be many of us are, I'll say, been around a while, and we've seen this through multiple cycles. Well, you have to remind yourself, there's been a pretty long run without a rash of customer bankruptcies and slowdowns. We knew higher interest rates, at some point, affects it, and so we do have to be very, very clear and clean in our rules. Because there are folks around that haven't actually lived through it as much as some of us have, and so we really – I give Bob and the division finance officers a lot of credit for cranking up our efforts. We all know how to do it, we know the process but you've got to crank up your efforts sometimes, so this is the time for it.

Okay. Just a follow-up on that quickly. But have you gone to any mandatory cash payments for any of your customers at this point, or is that more a future state potential?

No. We have those programs in place currently with certain customers. Typically, it's the smaller customers, Andy, that occurs lift. Obviously, for any new customers, we'll do significant credit checks to make sure that we're comfortable extending credit into our terms to any new customers. But I think in the main, at least this juncture has been focused at the smaller operations.

Okay. Thank you very much.

And we'll take our next question from Steve Barger with KeyBanc Capital Markets.

Hi. Good morning, everybody. Sherry Lauderback - Vice President-Investor Relations & Communications: Good morning. David M. Wathen - President, Chief Executive Officer & Director: Good morning Steve.

You talked about developing Packaging products for growing end markets, can you tell us what percentage of products go to those more favorable markets and what percentage are stable or declining? David M. Wathen - President, Chief Executive Officer & Director: It's a business that runs – if you use new products that have a turnover, it's a 10% or 15% new products kind of a business where there's enough change that you have to change tooling and maybe it's new patents and all that kind of thing. That, in my experience, is – I mean, it's not like a software business, but in a manufacturing business that's a fairly high percentage of new product turnover.

So obviously, some of the legacy programs have to be growing if you're projecting 4% to 8% sales. I guess the question is, what is the growth rate on the new products? Sherry Lauderback - Vice President-Investor Relations & Communications: I don't understand the question.

If you (35:06) David M. Wathen - President, Chief Executive Officer & Director: My definitions of products is it's all growth when it's a new product. So, then you do have to subtract some displacement where it is replacing our old product verses somebody else's; call it half of that is growth. You're going to wind up getting to a couple 3% of organic product growth. You're going to wind up getting to a couple 3% of, I'd call it, geographic growth where we're taking products places they haven't been before. Because we're still in the – we reorganized the front end of the business to get better at taking our full product line every place, but we're not. We're not – we clearly haven't accomplished that across all the businesses.

Yeah. The other comment I'd make, Steve, is a lot of the items that we would classify as new product sales or sales growth are applications of existing dispensers that are tailored to a specific customer program. And the success or the duration of that program is really a function of how well that customer's product does ultimately in the end consumer market. So it's not new product in the sense of – I'll use automobiles as an example, where you develop a new platform and you sell it all over the world kind of thing. Much more tailored to, I think, consumer products companies, specific marketing programs in regions of the world. Sherry Lauderback - Vice President-Investor Relations & Communications: But I think it's fair to say about half of that 4% to 8% is kind of new product-related. David M. Wathen - President, Chief Executive Officer & Director: Yeah.

Yes. David M. Wathen - President, Chief Executive Officer & Director: And then half of it is more driven by geographic moves.

In growth. Growth in existing business.

Got it. That's great detail. If total CapEx to sales is 4% to 5%, what is that for Packaging? Is that higher because of the new product development? David M. Wathen - President, Chief Executive Officer & Director: Yes, it is. We're also – remember, Packaging a business is a business that tends to run near full capacity and so periodically we have to add a plant. And we're currently modeled to do that in 2016.

You are adding capacity, okay. David M. Wathen - President, Chief Executive Officer & Director: Yes. For a while you can add it by trimming the fill of an existing plant with more molding machines and maybe switching to more automation. At some point, you need more space and we've hit that in Packaging. So we do have a new plant in 2016.

Understood. So obviously, Packaging is the most important segment from an EBIT contribution standpoint. Is the bigger risk to revenue and margin a slowdown in consumer in the U.S. or a slowdown in growth in emerging markets? Or would it be a further decline in industrial? I'm just trying to frame up the risks.

Yeah. I think if you look across those three segments it's, generally speaking, equally risky, right? Because the margin profiles across those three you mentioned really are pretty consistent, plus, minus, a couple of three operating percent either direction. So it would – a significant downturn in any one of those areas would be painful, no question. David M. Wathen - President, Chief Executive Officer & Director: But of course we think we've seen some industrial downturn. Consumer has remained pretty decent, as you know. Within consumers – I mean, where do you park pharmaceuticals, where do you park cosmetics and that sort of thing? There is a good history of that demand staying quite steady, even in a genuine consumer downturn. It's going to hit – logically, of course it hits household goods more than it hits medicine. That's one of the attractiveness of the business segment which we're in, of course, because it tends to stay a little steadier. But we still have a big consumer business all over the world, and quite large in the U.S.

Got it. David M. Wathen - President, Chief Executive Officer & Director: And as you know that's been holding up.

Yes. Yeah. Could you – I'll just ask one more and then I'll jump back in line. Can you tell me what the cash impact of the financial improvement plan will be in 2016? Because I think you're guiding to $60 million to $70 million, excluding the impact of that. I'm just trying to see what number is.

Yeah. Just bear with me. It looks to be about $4.5 billion.

Perfect. Thanks very much.

And we will take our next question from Steve Tusa with JPMorgan.

Hey, guys. Good morning.

Good morning, Stephen.

Can you just maybe give a little more color around the geographic sources and what parts of the oil and gas chain, downstream, midstream, upstream, that you have the greatest exposure on those customer charges? Just a little more color there. David M. Wathen - President, Chief Executive Officer & Director: So you're generally talking Energy? Because I could...

Yeah. The receivables issue, the customer solvency issues.

It was predominately downstream customers, Stephen. I mean, that's 85% of the overall Energy business activity. So not surprisingly that's where we would see the potential for the greatest risk. And the 15% upstream, that got hit a lot harder, a lot earlier in the year. And so as you look at the decline in Energy sales year-over-year – actually, other than the fourth quarter down draft that we saw on the downstream side, year-to-date through September those sales were actually up and were offsetting or negating the impact of what was going on upstream. So it remains to be seen whether this fourth quarter was an aberration relative to the downstream spending, or if it's something that will continue as we move through the year. Early indications are we're running at a reasonably consistent level in Q1 in terms of the downstream order intake that we did in Q4, but that can change as you move into the spring season that typically is a bit more higher level activity for the turnarounds.

Got it. And then... David M. Wathen - President, Chief Executive Officer & Director: If you ask – a different split – another split that matters on that risk profiles, much of our non-U.S. business is because we put a branch near our global customer. And if you looked at the customer lists in that business, the top of the list are always Dow, Shell, Exxon, BP, the people you would expect. And much of our global business goes to those refineries and, obviously, in general they're strong customers. The ones you really have to watch are the second tier, like service companies who do a lot of this outside service work for whoever it is. They're the ones you really have to watch their – watch our receivables with, as opposed to the big guys.

Got it. David M. Wathen - President, Chief Executive Officer & Director: And then geographically, a lot of those were in the U.S.

That makes sense. And then one more thing, you guys mentioned exports being weak and imports are more competitive, can you just talk generally about what you're seeing on pricing in your businesses? Even outside of Energy, are you seeing any unusual in this kind of deflationary environment, pricing behavior from competitors? David M. Wathen - President, Chief Executive Officer & Director: Yes, there's pricing pressure because everybody's so hungry for volume. The specific pricing pressure we get is when a feed commodity crops, resins and packaging, of course, has been going on for a while. And we've got a pretty good track record of holding margin percentages, maybe even doing better during those times. But once in a while, you have to pass some of it on. And we've talked about – some of it's contractual and some of it's negotiated. That even occurs like in this orders business, where it's the only real material is specialty steel, is alloy steel. And steel prices are pretty darn – I don't know if they're at the bottom, but you look at history of steel price curve, and it's come down. So we get a lot of pressure for that as expected. So I always try to figure out how much revenue do we hurt or get hurt on where we have to drop price when we hold margin percentage. It's a hard number to really get at, because there's so many transactions. But that said, there is that kind of pricing pressure for sure, and no let up in it.

What was price in the quarter for you guys on top line pricing? David M. Wathen - President, Chief Executive Officer & Director: Yeah...

Yeah. I would say, not a lot of impact in Q4. I think in the cylinder business we'll see some pricing effects as a result of the lower steel costs that we'll pass along to certain of the large customers.

Okay. That's make a lot of sense. Thanks a lot. Good luck in 2016. Thanks.

Thank you.

. We'll take our next question from Karen Lau with Deutsche Bank.

Thank you. Good morning. David M. Wathen - President, Chief Executive Officer & Director: Good morning, Karen

Hi, Karen.

Good morning. So just follow-up a little bit on pricing and Packaging. Could you quantify how much pricing headwinds you realized last year, and what are you assuming in this 4% to 8%? Has pricing sort of stabilized in that business?

Yeah. I don't know that I would – yeah, a little bit of a headwind, I think, as we move through 2015. I think as we've gotten towards the end of the year, input costs have stabilized and would not anticipate this being a negative going into 2016.

Okay. And then I guess maybe just go back to the previous questions about the jump in growth in Packaging. If you look at 2015, you guys did like a negative 1% for the full year, and I realized there is some currency headwinds but there's also acquisition contributions. So getting from like a flattish type of growth to 4% to 8%, is that all coming from new products or perhaps some of the programs in 2015 got pushed out into 2016? I'm just trying to square like why – I would imagine like some of the new products and geographic expansion was ongoing in 2015 as well. So just trying to understand why the big jump in forecast growth?

Well, I think certainly there is an element of programs which we expect that would occur in 2015 that were deferred by customers, and therefore we would anticipate that we'll get the benefit of those in 2016. I also think, though, that this transition that Dave has referenced regarding a move towards a market-facing vertical organization, that took some time in terms of getting it implemented and staffed in 2015. So I don't know that we necessarily received the full benefit of that, and I do anticipate that, that effort along with the completion of the Indian global innovation center, that we will ramp up the rate of new product programs. And there's clearly a focus on that business in growing the top line after, as you point out, also flat year-over-year situation in 2015.

Okay. Makes sense. And then just lastly, maybe on restructuring. So Energy, I think you took down your top line forecast by about 10 points previously. You were expecting down low-single to mid-single, now down to $15 million. But you're still expecting a pretty healthy margin expansion year-over-year, so is the incremental cost savings from the $15 million run rate to $22 million is incremental so they're all going into Energy? Maybe you can remind us how the savings are split across the segments.

I wouldn't say that. I think the operating improvement that we're looking at for the Energy group is really just a result of what I would call operational improvements in the sense of, for example, decisions on whether we – where we manufacture or where we source product. There's a lot of opportunity in the supply chain for us to improve our product cost structure and we're aggressively going after that. So that's one example. I think others are – as we drive down inventories, we'll shrink our footprint a bit. And again, your fixed cost is a little bit lower in that regard, so it's less about the fit directly impacting Energy, its more about the benefits of the restructuring, just improving the effectiveness and the efficiency of that operation.

Okay. So the incremental $7 million, which segments is that? How does that split across the segments?

Its really spread much like the originally $15 million what we announced. It's pretty much equally spread over each of the businesses. I mean, we go back to each business and we have targets. Probably the one exception might be Norris Cylinder, or I guess Engineered Components, generally, because the Arrow Engine business has really cut an incredible amount of costs to maintain its breakeven profitability, and Norris Cylinder really just has a very, very lean fixed cost structure to begin with. So maybe they received a little bit less in terms of the target, but in the main it was equally spread amongst the other businesses.

Okay, got it. Thank you very much.

And we will take our next question from Bhupender Bohra with Jefferies.

Hi. Good morning, guys. David M. Wathen - President, Chief Executive Officer & Director: Good morning.

Good morning.

Good morning. So I just wanted to continue on the previous question here. I believed you mentioned about driving down inventories, and now could you just – I mean, I'm looking at the balance sheet here. The inventories are down year-over-year. And just give us a sense of like which businesses actually have high inventories and where you would have the opportunity to honestly take them down? David M. Wathen - President, Chief Executive Officer & Director: I'll speak this same comment to you before. It's like you're sitting in one of our operating reviews. I ought to take you along sometime. The Energy business does still have inventory that went up due to the dock strikes last year. Remember those? We had 30-some container loads of product we've built in our Asian facilities that were for the U.S. customers that we then had to build basically in Huston to serve the customers. So wound up doubled up with higher-cost product. I keep pointing about that because it's behind us. But we still have that product to work off yet. We're doing it aggressively. But that was a – that showed that our numbers are locked from a cost standpoint, but it also drove our inventories up. So we've got that whole thing to work down. That's probably the big one. The Egypt business chasing revenue down would have more turns of inventory than we'd like. But there's some burn off going on, and of course, that has a big parts business that continues to burn off, too. I don't think there's anything else to really pops out and...

Not being – well, I won't consider unusual, I mean, we're always striving to improve turns and reduce the investment. And so all the businesses are subject to that challenge.

Okay. Okay. The follow-on on the guidance here, just help us, how should we – I mean, you did talk about the first quarter top line being down, I think what 7%? Is that the guide?

8% to 10% relatively.

8% to 10%. Okay, 8% to 10%. And we are ending the whole year like 2016 on Packaging up 4% to 8% with new programs coming in, can you help us – the cadence of like the first half versus second half in terms of top line, and what's actually built on the margin side in the first half versus second half here? Thank you.

Yeah. I guess the way we're thinking about it is we clearly see the impact or the carryover of what we experienced in Q4 and our initial Q1 numbers for January. We thought it was prudent to make sure that, that was communicated as part of this call. As we look out on the full year, however, we have revisited with each of our businesses and have looked at the assumptions underlying the growth forecast. And at this juncture, we don't see anything that would suggest later in the year that we're not going to see some uptick in our Aerospace and Packaging businesses. Sherry Lauderback - Vice President-Investor Relations & Communications: And while it lasts, the lower oil price are mid-year so... David M. Wathen - President, Chief Executive Officer & Director: We've all been staring at an oil price chart to remind ourselves that oil was still at – they made one big drop early last year. But there was $60 oil in the second quarter last year. And many people were thinking it was already swinging back up. And so I've been saying that quite often, we have to keep track of when we lap the effect of that...

On our business. David M. Wathen - President, Chief Executive Officer & Director: ...in our business.

All right. Right. Yeah. I was talking from the Packaging and Aerospace because the growth rate kind of looks pretty high. How should we think about the Packaging new products growth? Would that come in the first half or it's more like the kind of backend loaded growth rate? David M. Wathen - President, Chief Executive Officer & Director: It's a pretty decent – it's a ramp going up. It's by program. We've got both. The folks at Packaging and Aerospace model that pretty well based on new products, customer programs and how fast they convert. And then in Aerospace, of course we have build rate forecast, when it will hit for us and all that. So there's a – we would tell you, we would give you guidance that we could see those things going on underlying. And of course, as you well know, the math says it's Packaging and Aerospace that heads our totals. Or in this case, it's also Energy improvement. That's on a continuing ramp also, costs coming down on fairly flat revenues.

And can you remind us – yeah, go ahead.

I'm just going to comment on the Packaging front. Fairly ratable in the sense of throughout the year, but certainly first half is a little bit lower than second half improvement. Aerospace, other than first quarter, is pretty consistent across the remainder of the year.

Okay, got it. Thanks a lot.

And we'll take our next question from Mat Koranda with ROTH Capital Partners.

Good morning, guys. Just wanted to continue along the lines of the Packaging questions that have been asked, but maybe attack it from a different angle here. I think margins, you guys have been targeting that 22% to 24% range for a while now, but you've been running in the 25% range for the last couple of quarters. So I guess the question is, are we expecting some erosion from current levels? And does that have anything to do with the new customer programs that are rolling on or is it legacy programs? How do we kind of think about margins in Packaging for 2016? David M. Wathen - President, Chief Executive Officer & Director: I mean, I'd stick with the 22% to 24%. We hate to give up any, but when it hits 25%, it's usually something special going on in the business. I'd stick with that long-term 22% to 24%. We're obviously going to try to keep it at the higher range of that, but we also are willing to spend money on new plants, tech centers, new product programs and all that. So it's a balancing act that kind of centers at 23% or 24%.

Got it. Okay. And then in terms of the Aerospace segment, I don't think this has been covered much yet, but it does look like the outlook for 2016, it looks a little bit higher relative to your prior outlook. I think at the mid-point, you're roughly at 10% versus before you were talking about maybe low to mid-single digit growth in that segment. So how does – maybe you could just talk about the Parker facility's contribution to the growth outlook in 2016 and maybe any other granularity you'd like to get into there.

Yeah. I mean, clearly that change, Matt, is related to expected sales level activity as a result of acquiring the Parker facility. David M. Wathen - President, Chief Executive Officer & Director: Other than that, we haven't seen a lot of change in Aerospace. It's still on the way to ramp up, a little slower in 2016 than maybe the historical has been the last few years. And plenty of forecast that it kicks back up in 2017, but we'll see.

Okay. And one more for me here; you did mention acquisitions in the prepared remarks, but just wondering maybe in terms of the balance between Packaging and Aerospace, if you could put a little color around what you're looking at in the acquisition pipeline? Is it skewing one way or the other in terms of what you're looking at getting done first? And just with multiples being elevated at the moment like you said, Dave, it sounds like maybe we shouldn't expect anything in the near-term. Are those fair assumptions? David M. Wathen - President, Chief Executive Officer & Director: Those are fair assumptions. Packaging, you might put Packaging a little ahead. But the folks on the phone that understand our Aerospace business tried to convince me that maybe it should be Aerospace first. But that said, my judgment in that case is a little more around what do we have the management horsepower to absorb, and we're busy in Aerospace with Parker Hannifin, with the still – this fastening (01:00:18) business coming together more and more. We've probably got a little more horsepower in Packaging to do it, so I'd probably tilt that way. But the plus, we do find in Packaging the opportunity to do a product acquisition that we should globalize. And those are almost the only ones that are going to make sense at current multiples. And we almost need to find some special case that pulls the multiple down some or gives us a lot of synergy going in. Multiples are tough to get over. As hard as it is to say no sometimes, that is exactly the right thing to do, and say we will come back at it another time.

Yeah. I mean, there's been a fair amount of activity in terms of opportunities. We, of course, look at many items but are pretty discerning as to what we're willing to pursue, particularly in light of the elevated multiples. So more to come, but a lot of interest, a lot of activity, and as you might expect, fairly competitive.

Okay, very helpful guys. I'll jump back in queue here. Thanks.

We will take our next question from Walter Liptak with Seaport Global.

Hi. Thanks. Good morning, everyone.

Good morning, Walt.

I wanted to ask about the balance sheet, too. What's the right debt level for you guys now looking at your debt-to-EBITDA. And then also, kind of along the lines of the inventory and cash flow question, without acquisitions, where do you think your debt will be at the end of the year given the forecast?

We're targeting, and I think consistently have targeted, a leverage ratio, Walt, between 1.5 EBITDA and 2 times EBITDA. And I think, if absent of there being any sort of acquisition in 2016, we get down to about 2 times by the end of year, based on free cash.

Okay. Perfect. And I wanted to ask about just a couple of follow-ups. In the Energy business in the presentation, you call out exiting some low margin business and so I was wondering if it's possible to look at a 10% to 15% decline and break that out by price versus volume versus exited business? David M. Wathen - President, Chief Executive Officer & Director: I don't think we're that precise yet. Part of our reason to guide to those lower – it is that we've got – we are quite serious about exiting some pieces business that aren't attractive. And there's quite a bit of that underway, working that price versus exit versus what can we do differently and all. I don't think we're precise enough to really say what that is yet. We'll get more precise as this year goes on. It's a relatively small piece of that decline; that's more of a market thing.

Okay. Fair. And then I think you talked about turnarounds a couple of times; what is your outlook for turnarounds this spring, because I've heard mixed things? I don't know what your data points are telling you; are we finally going to get more turnarounds? David M. Wathen - President, Chief Executive Officer & Director: It's a frustrating thing to forecast. You watch daily order rates and right now you might say there's some turnaround. This is the season and there would be some coming off, but it's too early to say what it's going to look like.

Okay, great. And then you mentioned – skipping over to the Engineered Components segment, cylinders being weak and I wonder about the Airgas, Air Liquide merger, if there's any disruption related to a consolidation or a potential consolidation of those two businesses? And then just to ask about the capacity expansion, if the market's weak, why increase capacity? David M. Wathen - President, Chief Executive Officer & Director: That combination is quite attractive to both of them because they cover different continents. We ship to both of them and so we know very well where their strong markets are. So there is no geographic hit with that combination. Now, I always remind myself, in every acquisition anybody does, there's a line item about purchasing synergy, which means drive prices down. But we've got the spec and all that kind of thing. The offset to softer industrial markets is we have done a lot of work recently with some different specs trying to expand applications for some of our products. We've had a whole lot of work that's been taking a while, but to do with precision of the thickness of walls and can we make a lighter weight cylinders that have the same capacity. And strict order as that sounds, it's been a lot of work. And some of those things are clicking, so I am encouraged by – in spite of currency and in spite of all that, in spite of kind of weak industrial, that business is doing very, very well. It's a very attractive business.

Yeah. And I would mention also, Walt, that while there is not significant growth top line there, that business has been operating near capacity for a few years now. And that asset runs, essentially, 24/7. And as they shift the product mix between ISO and DOT cylinders that set ups – that takes the forge down. So it gives a lot more flexibility to respond to differing customer order types. And so it's not just strictly a capacity play, it's about flexibility as well as efficiency in terms of your ability to meet customer orders. Because a lot of times it's how quickly can you get the order to the customer. And if you can do it in two weeks, you get the order. If it takes you eight weeks, maybe you don't. So part of this is about increasing the flexibility and the capability of responding more quickly to customer demands.

Okay. David M. Wathen - President, Chief Executive Officer & Director: And I think I mentioned – but there's also a characteristic in our Huntsville plan where we make smaller size cylinders. We make some from tubing, from high pressure tubing and fabricated cylinders. We could make those with the deep drawn cylinders out of the presses. If we have capacity on the presses, our total cost goes down to meet the same spec. And so there's also a productivity side of this that allows us to take cost out on some other specs. So...

Okay. All right. Great. Thank you. David M. Wathen - President, Chief Executive Officer & Director: Those are kinds of decisions we'll have to make once in a while is, over the course of the next couple of years, what do we get out of it and what convinced us they would.

Okay. Fair. Thanks for the color.

And we will take another question from Steve Barger with KeyBanc Capital Markets.

Hey, thanks.

Hey Steve.

What is your market share in cylinders? You have most of the dominant position, right? David M. Wathen - President, Chief Executive Officer & Director: Yes. We have a very, very strong position.

Well certainly in North America. David M. Wathen - President, Chief Executive Officer & Director: Sorry, in North America, just because of the shipping costs, all that sort of thing. We won an anti-dumping case that got into all kinds of stuff that we're a little cautious about spelling out exactly where we have...

I understand. Yeah... David M. Wathen - President, Chief Executive Officer & Director: But no, we are quite strong, as you could imagine, within our shipping distances.

That's what I thought...

Yeah. And clearly, as a global marketplace, there's distinct regional competitors in other parts of the world that they obviously are strong in those – in region. And just like us, looking to export into regions outside of North America, they're obviously doing the same thing in terms of trying to export into North America.

But the majority of your sales are in North America for cylinders? David M. Wathen - President, Chief Executive Officer & Director: Yes.

Yeah.

Is that right?

But notwithstanding that in our dominant position is it's a pretty competitive marketplace, both here in the U.S. and globally.

I guess I just don't understand, you won the anti-dumping case and you're the dominant supplier in the U.S., so where does the price competition come from?

There are others. David M. Wathen - President, Chief Executive Officer & Director: Yeah. Other than those...

And the restraining order is related to Chinese manufacturers. There's competitors outside of China that ask for minimal. David M. Wathen - President, Chief Executive Officer & Director: People say that Australia and Italy are pretty hungry right now.

Got it. The reason I got up back on actually was to ask you a question about the debt pay down, the slides say it's a priority. But I'm just curious, what's the decision trigger for share buyback versus debt paid down? Is it purely quantitative or qualitative, or how does it work when you think about that capital allocation decision?

I would say it's more qualitative and it really depends on our evaluation of share price at a point in time when we're in a window and able to buy shares back.

Are you willing to talk about what factors go into your evaluation of share price?

Not at this time. No.

Okay. Thanks.

And it appears that there are no further questions at this time. Mr. Wathen, I'd like to turn the conference back to you for any additional remarks. David M. Wathen - President, Chief Executive Officer & Director: Thank you, everybody. We sure appreciate the interest. I would leave with you with the thought that while it's tough out there, there are bright spots to go after, and we really keep after it. And I think there are enough bright spots in 2016 that we're going to look back on it that we like it. So thank you. Stay tuned. Thank you.