Welcome to the United Rentals First Quarter Investor Conference Call. [Operator Instructions] Before we begin, note that the company's press release, comments by presenters and responses to your questions contain forward-looking statements. The company's business and operations are subject to a variety of risks and uncertainties, many of which are beyond its control, and consequently, actual results may differ materially from those projected. A summary of those uncertainties is indicated in the Safe Harbor statement contained in the release. For a more complete description of these and other possible risks, please refer to the company's annual report on Form 10-K for the year ended December 31, 2010, as well as the subsequent filings with the SEC. You can access these filings on the company's website at www.ur.com. Please note that United Rentals has no obligation and makes no commitment to update or publicly release any revisions to forward-looking statements in order to reflect new information or subsequent events, circumstances or changes in expectations. You should also note that today's call will be including references to free cash flow, adjusted EPS, EBITDA and adjusted EBITDA, each of which is a non-GAAP term. Speaking for today's United Rentals is Michael Kneeland, Chief Executive Officer; and William Plummer, Chief Financial Officer. I will now turn the call over to Mr. Kneeland. Mr. Kneeland, you may begin.

Thanks, operator, and good morning, everyone, and welcome. On the call with me today is our CFO, Bill Plummer and other members of our senior management team. And as you know from prior calls, the context of our financial performance is our ongoing transformation of the company. Today is about -- a start of a new financial year but at the same time, our discussion is very much about the continued deployment of our strategy. That strategy has guided us through the intense economic challenges and as you know, it helped us turn the corner ahead of our industry and markets late last year. And we've been able to build on that momentum in the first quarter performance. And I wanted to discuss some of those metrics in terms of our strategy and then take a look at the drivers of our performance, both internally and externally. And then after that, Bill will discuss our financial results and then we'll go to Q&A. So let's get started. Three months ago, we looked at 2011 and we made a bold statement that set us apart from the rest of the industry. It was based on one word, it was outperform. And last night, we reported numbers that made good on that promise. In the quarter, with -- non-res construction was down, flat to down, year-over-year, we increased our rental revenue by 14.2%. We improved our time utilization 6.2 percentage points to a new first quarter record. We raised our rental rates by 4.2 percentage points year-over-year and drove gross margins higher on every major revenue stream. Now all these achievements were right in line with our internal projections. And while we reported a loss for the quarter, we realized $30 million more in adjusted EBITDA with 3.6 percentage point improvement in…

Thanks, Mike, and good morning to everyone. So as usual, I'll try to give you some more color along with a little bit more in the way of numbers on the quarter and then update the outlook as I go through. So first focusing on the Rental line of business, Mike mentioned the increase of 14.2% revenue, within that 4.2% improvement in year-over-year rental rate and just north of 5.5% of sequential improvement versus the fourth quarter. So the general statement we'd make is, as Mike said, we're comfortable with achieving the 5% plus of rate performance that we talked about for the full year. The first quarter positioned us well and certainly was consistent with our outlook on how rates would progress in the quarter. Within the quarter, Mike mentioned that monthly contracts turned positive. They were up 3.2% year-over-year, and again, that's very encouraging given how as we talked about in the past, monthly rates tend to lag daily and weekly rates. We continue to see nice progression in those daily and weekly rates and now monthly has joined the party. It's also worth noting that March alone, on a year-over-year basis was a particularly strong month. March rates were up 5.5% for the month only compared to last year. And so that's given us good momentum coming into the seasonally strong second quarter and we still feel good about how things are progressing to this point in April. Looking at volume and time utilization, our OEC on rent was up 13% year-over-year. And within that equipment type, earthmoving was up 18%, whereas aerial was up 6%. So earthmoving certainly is behaving the way that we hoped and expected and leading the charge. It's also encouraging to see that aerial demand has increased and we expect that to…

[Operator Instructions] Our first question comes from the line of Ted Grace from Susquehanna.

First question I was hoping to run by you is on the margin side, and Bill that was very helpful for you to kind of run through some of those variable issues on the rental side. I guess, 2 things I was hoping to ask would be, on the SG&A side, you know, if you back out the $4 million non-recurring in 2010, it was up about 6% versus 10% growth in sales. Was there anything notable in SG&A or elsewhere? And then just going forward, as we think about the remainder of 2011, are there more crosscurrents we should just start calibrating ourselves for?

So in SG&A, I guess the only other thing that I would point out is that the incentive comment I made about cost of rent, repeats in SG&A as well, since incentive comp is part of what remains after you strip out that non-recurring from last year. Outside of that, there are the normal puts and takes within SG&A, I would point out that obviously the higher revenue is driving higher commissions. But as a percent of revenue overall, the selling cost is not dramatically different this year versus last year. But we're pleased generally with the SG&A performance, excluding that one-time item last year. But as is always the case, we're looking for opportunities to drive it even lower. As you look down the road, a couple of key things to point out that might be coming, and this relates both to cost of rent and SG&A. I'll remind everyone that we haven't had merit increases for the last couple of years. We will reinstate our merit increases beginning in the second quarter. We expect that impact to be somewhere in the area of $8 million year-over-year for the remainder of this year. It's about $6 million in cost of rent, another $2 million in SG&A. And that represents a little bit of a headwind that we know is coming down the pipe. We also reinstated the prior caps to our 401(k) program. That's a much smaller impact that we actually experienced in the first quarter, but that will continue throughout the remainder of this year. So that's another kind of a recurring expense item. It was only $300,000 or so in the cost of rent. I forget what the number is in SG&A, even though it's a fairly small number. So it's not a major issue, but it's…

That was helpful. Was there a meaningful change in headcount in the quarter? If you look at the end of fourth quarter, I think you said 7,000 employees versus 8,300 at the fourth quarter of 2010. I was wondering if that moved up 1Q versus 1Q and then the impact of diesel costs that you would have absorbed.

Yes sir, so on headcount -- I'm scrambling madly to find it on my list here. We've got it. For the average employees, we're down roughly 475 year-over-year -- yes, for the average during the quarter. So clearly, continuing that trend of being more efficient in supporting the operations with a lesser headcount.

Ted, I was going to mention, just on that note, when you look at the rental revenue per head of which is a metric I keenly watch, it was just under $20,000 per head, around $19,900 and change, which was a 22% improvement on a year-over-year basis. So again, we're very cognizant of watching our costs.

Yes, that's great. And then just the last thing and I'll hand it over to somebody else. On the diesel side, can you help us understand how that impacted the quarter or how we should think about the amount of diesel you consume in a year and just calibrate our expectations that way?

So in the quarter -- we have a diesel hedging program in place, Ted. And for the quarter, about 40% of our exposure was hedged. In subsequent quarters, that number is going to be higher. We put on some more hedges. So we're about 70% hedged for our diesel need over the remaining quarters of this year. We haven't historically talked about the specific numbers attached to the amount of diesel that we consume or the dollars associated with it. So I won't offer any new information on that, just here and now. I don't think that there was a major impact to the quarter overall from higher diesel but clearly, it was a headwind for us.

Okay.

Our next question comes from the line of Henry Kirn from UBS.

Is there anything last year from a seasonality perspective that you think should be different this year, just thinking about how to model the year -- the rest of the year coming up?

Henry, it's Bill. I'll try that first, Mike, if you don't mind. There's nothing prominent that I think about here that's going to be different this year going forward. We talked a little bit about sort of the -- Mike, mentioned a harsh winter environment in the first quarter, but it was a harsh winter first quarter last year, too. So that first quarter, I don't think was a major difference and as we look forward, I'm not seeing anything that I would say would result in a significant change in the seasonal pattern. Anything to add?

No, I would say I think he's right on, Henry. The way you look at -- if you look at it over time, you can see the sequential improvements we have from first quarter, second quarter, third quarter, fourth quarter and then back down into the first quarter. The seasonal impact is there and the reason we mentioned that is that it's part of our overall business, and we have the broadest footprint and therefore we have probably a higher fluctuation than others.

And versus your own model, as you looked out at the first quarter a couple months ago, what areas, either geographically or by end market, came in a little better or worse than you expected?

That's a great question because we expected Canada to do strong -- to be honest with you, if I was sitting here saying 35% in the plan process, we probably would have thought a little bit differently around it. We knew it was going to come in strong, we just didn't know it's going to come in that strong. The other thing is, as we've mentioned, particularly around states, when you take a look at California at 10% -- again, we suffered with California for several years and there's nothing dramatic that has changed other than the fact that we took a lot of locations out. But to see that part of the country come back online, we take that as a positive. And conversely if you take a look at Florida, Florida was up again strong single digits. And of those 2 areas of the country which have been particularly hard-hit with this economy, we took a lot of -- it gives us a lot of confidence in how things are playing out. So those are kind of the bookends. I would also say that the Midwest also, given the impact it's had over the last several years, we knew once the big 3 got back online and started to think about producing cars, it has a profound effect throughout the economy. So the Midwest had a very nice pickup for us as well.

And one final one and I'll pass it this time -- I think Bill mentioned that one of the reasons for the higher used equipment margins, sales margins, was that you sold more through your own channel as opposed to auction. What do you expect to be able to do for the rest of the year as for your own channel versus auction?

We are encouraged that we can continue to drive more through retail overall than we have historically. I'm not here to say that we're going to do 85% in retail for the remainder of the year, but we fully expect a solid retail mix throughout the remainder of the year. I do think that auction will remain a fairly small portion of what we do throughout the remainder of the year. And I'd say that a, because we're doing better through retail; and b, because we will do more sales back to some of our vendors this year as the year goes on. Didn't do a tremendous amount in the first quarter, but as we go through second, third quarter and maybe in the fourth quarter in particular, we expect to sell more back to some of the vendors. Those sales usually come with margins that are better than auction but not as good as our retail channel. And so as we mix more of that type of sale in the margin performances, it's clearly going to be lower than what we did in the first quarter. We haven't put a specific number on it, but it will clearly be lower than first quarter.

The other thing I would say on that is just to Bill's point on used prices, as a general comment, Henry, if you take a look at the Rouse report, it had a 3% improvement in one month which is pretty healthy considering that over the past 6 months, used prices are up 7.5%. So clearly as we've stated -- as I've stated, you take a look at used prices as being one of the foundations of the recovery and then comes utilization and then comes rate. So I always look at the used price market as a whole.

[Operator Instructions] Our next question comes from the line of Philip Volpicelli from Deutsche Bank.

Just trying to understand the rate versus yield, I guess, relationship. So revenues were up 14.2% and volume was up 12.8%, so that would indicate to me that yield was only up 1.4% yet rates were up 4.2%. Are you guys discounting on delivery, or are you discounting on some other things that -- kind of help me understand the math.

Phil, it's Bill. This is always a -- to do it right, is always a complex discussion. But I'll point out what we do, do. In our rate calculation, the 4.2%, that is the weighted average of the year-over-year changes using the current period waiting for time mix, day, week and month and for fleet mix. And so because it's based on the current period waiting, you can't just use it directly to explain the year-over-year change in revenue. It is, in our view, the best way to think about and to talk about rental rate performance because it fixes the mix as it relates to rate and it fixes it at a point that is in the current period, which is what the current market is all about. But it does make it harder to just blindly apply it to the year-over-year change in revenue and say, oh well, everything that's not rate by that calculation has got to be either volume or mix. The other thing to think that about in trying to explain year-over-year change is that when we say volume up, we're talking about the OEC on rent as the measure of volume. And so clearly embedded in that is a change in mix from one period to another. That makes it complicated to talk about the year-over-year change, explain the year-over-year change just using the OEC change from one year to another. So it's a fairly complex interplay if you're trying to explain the year-over-year change in revenue and that's why it's hard to talk through. Let me stop there and ask you if that helps or if that confuses you even more and we'll give you this concession to ask another question, if it didn't help.

No, that's great, Bill. I appreciate that. I'll follow up with Chris Brown off-line, but that's very helpful to get the different compare. Thank you.

Our next question comes from the line of Jerry Revich from Goldman Sachs.

Bill, your unchanged free cash flow guidance despite the acquisition implies lower organic CapEx. Can you talk about why you decided to pull back or did your initial guidance contemplate the acquisition?

We had a notion that we might do the acquisition. It wasn't certain at the point that we set the number, but we had a notion. I don't look at it as a pullback in organic CapEx at all. We feel very comfortable that we can flex whatever activities we need to flex in order to accommodate CapEx for the acquisition. So I don't look at it the way you stated the question, Jerry.

Okay. And Bill, just a related follow-up there, can you talk about on the Venetor business, any regional overlap with your existing businesses and what kind of cost or revenue synergies are you targeting on the new business?

Without going to the specific cost of revenue synergies, I think that we are certainly expecting Venetor to enhance our position in Ontario, in particular. And we fully expect to leverage the people, systems, the equipment and the relationships that they have both for revenue improvement and for cost synergies. We've consciously chosen not to talk though specifically about the synergy numbers simply because we believe the synergies are there and are justified. But some of that work has to be done and some of that work, quite honestly, we don't want to show our hand to some of our competitors.

Our next question comes from the line of Chase Becker from Crédit Suisse. Chase Becker - Crédit Suisse AG: I was wondering if you could calibrate the comments on rates that -- can you talk a little bit more about your rate expectations for the balance of the year? I know you had mentioned that you're expecting -- it sounds like an acceleration in the back of the year in rates. I'm just a little confused by that commentary because I would have thought that your comps are easier in 2Q and we wouldn't see an acceleration, did I misunderstand that?

No, you got it right. The comps are easier in Q1 and Q2. Q2 is actually pretty easy as well. Remember the trough for us last year was March. And it was April on that we had sequential improvements throughout the remainder of the year. So the comps are easier but our expectation is that the level of demand that we expect to see in the season this year, as well as the level of focus that we put on managing rate will help us achieve even better sequential rate improvement in the second and third quarter in particular, and that will lead to an acceleration in the year-over-year performance of the second and third quarter compared to what we got in the first quarter. So that's one of the things that we've tried to address throughout the first quarter in some of our comments in conferences and one-on-ones when we said that we didn't expect the rate performance to be front-end loaded. Our expectation always has been second quarter, third quarter are going to give us the opportunity to have significant rate improvement. And in fact, you can do the math, right, we were 4.2% in the first quarter. So we expect that we are going to do even better than that, and in fact, better than 5% in order by the math, right, in the second and third quarter in particular. And so that's what we the believe will be available to us and we're going to execute against it.

Chase, I would just add that the biggest take away I look at is and I thought was very important was the sequential rate improvement between fourth quarter and first quarter. Even in the great strong economic times, it's always been challenging to get that kind of sequential rate improvement. So we've got 0.5 point between the 2 quarters and typically going in your first quarter, which is your most challenging and weakest one. So we feel very comfortable, I think the team is doing a remarkable job and we're always looking for more. Chase Becker - Crédit Suisse AG: Okay, that's helpful. And I guess my follow-up, just digging in on the G&A question. I know there's a lot of moving parts there but in the last couple quarters, your G&A as a percentage of revenues is running in the mid-15% or 16%, and it was closer to 18%. So I just want to make sure I understand how you think about that as a percentage of revenue for the balance of the year.

You've got to remember the seasonality in our business, Chase. So the first quarter is always going to be a higher percent of revenue because it's such a lower revenue quarter. As we go through the year, our plan has us reducing SG&A as a percent of revenue over the remainder of the year, especially excluding the impact of that regulatory recovery that we had in the first quarter. That's the way that we're thinking about it and that represents leverage that we expect to achieve for the cost takeouts that we've done over the last several years.

Our next question comes from the line of Seth Weber from RBC Capital Markets.

Bill, the 59% pull-through on the Rental business, is that also the type of number we should think about for the rest of the year?

Harder question to address, Seth, but I think that's probably at the lower end of what you might think about. I'm dancing carefully here to stay consistent with how we decided to communicate. So I don't want to sound cute, but I'd rather not put a specific number on it. But I think that with some of the cost items that I talked about, we're going to be very intently focused on making sure that the cost that we need to bear, we do bear. Our hope is that we'll deliver a flow-through that's better than that. Historically, it has been a little better than that. And we'll continue to drive it as much as we can.

Okay. I mean, I imagine you assume that the sales -- the equipment sales margin doesn't stay in the 40%-plus number range, right?

That's right. It will be lower.

Can you give us the delta utilization change year-over-year in March? You gave us the pricing up 5.5%.

Utilization change in March?

Yes.

] Sure. Time utilization for March...

William, you got it there?

For the month of March alone, it was 5.7 percentage points.

Okay. So I guess what I'm wrestling with is, you drove pricing up 5.5 points and utilization was still up almost 6 points -- why you can't raise your one point guidance for the year? I mean, you've demonstrated that you can drive utilization and pricing together.

So I think the real rationale that we haven't raised it is as we've looked down the year, the utilization improvements that come in the second, third and fourth quarter, last year that came last year, were significant. I mean, they were huge improvements. And so we're cautious about baking in a lot of improvement over those records in the remaining quarters of this year. Are we overly cautious? I guess time will tell. We certainly felt good about the momentum we established in utilization in the first quarter and 3 months from now, when we're talking, maybe we do raise it a little bit above the 1%. But right now, we feel that the 1% is the right way to think about it and we're going to, as always, push to make that happen and then some.

It's always a balance between rate and time and that's always going to play out. I think if you go through -- as we go through the second quarter and we re-announce the second quarter, if we see something different, we'll obviously communicate that and let you know if we're going to up it. But clearly, we want to be cautious because we want to make sure we're balancing against the rate improvement that we want to achieve.

Okay, and relative to the -- when you talk about 1 point of pricing is $17 million or $18 million of EBITDA, is there a number that you think about for utilization?

I think we've historically said $15 million. So each point of ute [utilization] is $15 million.

Okay, and then I guess just lastly clarification, the CapEx number, the $625 million, does that include the acquired OEC?

It includes the capital that we would spend in support of the acquired company. That make sense to you? So $625 million would include any capital that we would spend to support Venetor. It does not include the purchase price of buying Venetor.

Okay, and have you disclosed that price yet?

We have not.

We've not.

Will that be in the next quarter's Q?

In next quarter's Q, by GAAP, we will have to put in the cash flow used in investments, and so look for exciting reading in the second.

We're not trying to be cute. As you know, it's something that we have never talked about and we also are always in communication with other companies and we just felt it was appropriate that we just keep that private.

Okay. All right. Thanks very much, guys.

Our next question comes from the line of David Wells from Thompson Research.

I guess I'm trying to understand -- I think you touched on this earlier, but if I look at the year-over-year rental improvement in your Rental revenues, we continue to see a sequential move up. But that flow-through number softened in the first quarter and I appreciate the additional color of the delta there. But I'm trying to get a sense of what was it that happened in this quarter that popped up necessarily, that made that soften relative to where we were in the third quarter and fourth quarter of last year? And I guess by reaffirming your EBITDA flow-through, I mean, it sounds like that this is one-time in nature to some extent, is that the right way to think about that?

David, so I think what I tried to do in my commentary was to talk about things like focusing on improving our PM currency and focusing on reducing the amount of OEC that's not available for rent, whether it's because of repair or pickup status or whatever. That focus was an intense focus in the first quarter. And we see it in the results, right? Our PM currency when you look at the improvement over the prior year, just looking at the month of March, it was up 1.5 percentage points. And so we certainly got a result, right? We wanted to manage the fleet to a higher level of preventive maintenance overall and we got it. Similarly, with OEC not available. That improved, just for the month of March, improved by about 1 percentage point, 1 full percentage point. So our fleet is more readily available for rent. Those were particular focuses in the first quarter that was part of the repair and maintenance expense story within cost of rent. One of the things that I can't say with certainty right now is whether any incremental expense from that special focus will continue through the remainder of the year. Our hope is and our expectation is that it does not. But making sure is one of the things that we're going to be very focused on as we go through the second quarter and further on. The one thing that, again, I tried to point out is that, that is going on and will recur is the fact that our fleet is older this year than it was last year. In the first quarter, that difference was about 4 months. The difference will be less in the subsequent quarters simply because we were aging the fleet throughout last year, but there will still be a difference and therefore there will be an impact just to maintain a fleet that's a little bit older. Historically again, we've talked about each month held over an entire year being worth somewhere between $2 million and $3 million, call it $2.5 million for kicks. So those are the things that I would point to within the rental line as areas to focus on. The other areas, I mentioned profit-sharing, that's going to recur, that's going to continue throughout the year as long as we continue to perform well. It was a $4 million impact in the first quarter. So if we continue to do as well, you could expect a number like that in each quarter coming up. And then I also pointed out the merit increase that we expect that we know will be reinstated effective April and carried through for the remainder of the year. That was about $6 million in cost of rent, $2 million in SG&A.

Sure. So given that, I guess I'm having a hard time seeing where does the pickup in flow-through to that 65%, 70% range come from. Is it coming just from leverage on the top line in your commentary around the rate environment? Or are there some other cost levers that you're finding just as you look for low-hanging fruit or whatever the case may be?

Yes, I want to be clear that the 65% to 70% flow-through is total revenue flow-through to EBITDA. The rental revenue flow-through to rental gross profit was about 59% in the quarter and that's what's impacted by all of these cost of rent-related items most directly that I just talked about. I just wanted to make that distinction clear.

This is Mike. The one other thing I would add is that when you take a look at -- when you're trying to look from third quarter to fourth quarter to first quarter, if you look at the history of the company overall, when you take a look at the performance, there's always been a buildup in the first quarter to the second to the third. And then from the fourth quarter into the first quarter, there's always been a little bit of a drop. So it's been historic on the gross margin on rental.

Yes. Again, David, I guess I would also add that the rental flow-through to gross profit of 59% -- I think at 59% is what I calculated, maybe it's 58% -- is not out of line with what we had in the first quarter in prior years. So that's something that gives us some comfort that says, you know what there's not a lot of unusually large costs that we incurred in the first year. But it is a little low relative to where it's been in other quarters throughout the year. And given the focus that we put on some of the measures, we thought it appropriate to call out and talk about those factors as part of what's been driving our rental performance. We feel good about our rental performance. So let me be clear about that, right? We improved our rental gross margin by over 5 percentage points compared to last year, that is not nothing to sneeze at. But we want to be upfront in talking about the focus on costs that we want to maintain because it's harder now, with variable costs going up on higher volume, it's harder now to be as clear about the cost performance than it was last year and the year before where you could just say, oh, the overall cost dollars are down. Now we've got to be a little more nuanced in how we talk about it so that's why we're focused on it.

Yes, and I guess what I'm trying to understand is given the cost save that you've done over the last couple of years, with a good portion of those being fixed costs, to the extent that the variable cost come back from the volume piece is -- what I'm trying to figure out is for this first quarter, is this a function of the cost save that you've taken earlier not being as permanent as you thought they were?

I don't yet have and I must admit, I haven't done a detailed analysis on sort of permanent temporary for this quarter. My gut's telling me that I don't have the reason to be concerned about the share that's permanent being significantly different. But I also want to be very, very vigilant around the cost performance to make sure that, that indeed is the case. And so that's what I'm trying to give a flavor for as we've talked about our cost performance in the first quarter.

Our next question comes from the line of Emily Shanks from Barclays Capital.

I just had a question on the balance sheet. I saw that you have purchased some of the quips and I wanted a little color around whether this is a one-time item or are you going to be targeting debt reduction in this line item going forward? And then how you look at it versus just paying down the ABL?

So, Emily, on the quips purchase, honestly, it was an opportunity that presented itself to us. We had an investor call up and asked if we would be interested in purchasing some. And as we talked to them about where they would sell, we decided that it made sense. I think the note in the Q suggests that we bought it at a little bit of a discount and we thought that it made sense to execute. So whether or not we do it again going forward, I think will just depend on whether or not somebody has a chunk they want to sell. And I'm sorry, your question about the ABL, was what again?

Sorry, just how you are evaluating or considering being bought back at par versus paying down your ABL? [indiscernible]

Well, I mean, the underlying cost of that quips issue was 6 1/2%, right? That's the deal where we issued debt into a trust. The cost on that debt was 6 1/2%. The ABL cost us 3 1/4% right about now. So just on a pure interest rate arbitrage basis, it makes sense from that perspective. Does that answer your question, Emily?

Yes. Thank you.

Our next question comes from the line of Joe Box from KeyBanc Capital.

Quick question, most of mine have been answered, but one's more high level. Can you just talk about what your construction customers are saying about rising construction input costs? It look like some of these guys could be getting squeezed on the margin and I'm just curious if you're starting to see any negative implications like delayed projects or potentially even less pricing power on your end?

We haven't, at this point. In talking with some of the contractors, obviously, the most immediate cost is the cost of fuel that they have. They're very sophisticated, and some of our large ones, our large customers may buy these things out well in advance and secure their pricing for most of their jobs. And we haven't seen any disruption to-date or even mentioned to us based on the rising cost. I think that we talked about rising cost and a whole multitude of things, not only in the construction but just about everywhere we can think of including certain commodities like cotton. Having said that, one of the things that we were attracted to the Canadian market was because of commodities and the desire to get those commodities. We think it fuels a lot of the growth in the Canadian marketplace.

And our last question comes from the line of Scott Schneeberger with Oppenheimer. Scott Schneeberger - Oppenheimer & Co. Inc.: Thanks, guys. Two separate questions, the first one, following up on David's line of question because I think there's some concern about just the incremental cost here. I guess, Bill -- you maintained the guidance for incremental margins, EBITDA margin is 76%. Was what you delivered in the first quarter what you expected or are some of these incremental -- it sounds like largely variable costs more than what you had expected? And I guess I'm kind of asking the same question as David, but are you -- it sounds like you're confident in what you can do going forward, might there be incremental fixed cost savings activities that you need to take upcoming to maintain that? Or do you feel very comfortable that this is all going as planned and what we're seeing is just very much a factor of lower revenue and a seasonally soft first quarter? Thanks.

Thanks, Scott. I'll start. And I think for the quarter, the reason I focused and spent so much time talking about the cost is that as we saw the cost unfold in the quarter, we said to ourselves, let's make sure that we're spending cost in the right place and we're spending the right level of cost. And we've gotten ourselves comfortable on a number of items, but there are a couple of things that we want to explore further. So the amount of effort and expense that we put into improving PM currency, improving OEC not available, we want to make sure that, that's the right level. We're not concerned, it's not a problem, but we want to make sure that we are not missing an opportunity to be even more efficient in the use of that expense than we were in the first quarter. So I'm being very careful here because I do want to be clear that it's a matter of wanting to be hyper-focused, to make sure that we're using every expense dollars as efficiently as we can. For the full year, we're very comfortable with all of the outlook that we've given you. We feel like we've got -- even if there is an issue in cost, we've got ways to respond to it. And so in that regard, if it turns out there is an issue in cost building, we feel like we've got some additional actions that we can take to address fixed cost or to address variable cost elsewhere if we need to. So I'm trying to be responsive but also very particular in saying that there is a cost focus here and it's something that we want to make sure that we are maintaining.

The only thing I would mention is as far as actions that we're doing, Scott, is as you know we've mentioned about our program called FAST. We're rolling that out. We believe that will drive a better efficiency in our delivery process. We've got about 90 of our locations to-date that have been trained, and we will continue that to the balance of this year, but those are longer-term effects that should yield us some cost efficiencies as we go forward. Scott Schneeberger - Oppenheimer & Co. Inc.: Okay. Thanks, guys. And then one final question Bill, with regard to the tax rate, so for us modeling, the 30% should be the full year '11 rate that we're targeting? And then I guess the question is, subsequent to that in the out years, I've been modeling a high-30s number, how should we think about that? Thanks.

Starting next year, I think you should be modeling more like the low-30s. Tax rate is always an adventure with us just given the mix shifts that happen, but I think being in the low-30s is good guidance for you. You know, the acquisition of Venetor, for example, skews us a little bit more toward Canada. So that's going to help maintain that rate down in the low-30s. Scott Schneeberger - Oppenheimer & Co. Inc.: Okay, thanks.

Operator, it's a good time to wrap up the Q&A, and I want to thank everyone for joining us on today's call. If you go to our website, you can download our latest investor deck, which has been updated and also expanded with new information. And as always, we welcome your calls here in Greenwich and get a hold of Fred Bratman, if you would please, and we'll make sure that we can reach out to you and answer any additional questions. So operator, this concludes our remarks. And have a great day, and we'll see you next quarter.

Thank you. And thank you, ladies and gentlemen, for your participation in today's conference. This does conclude the program. You may now disconnect. Good day.