Good morning. My name is Jennifer, and I'll be your conference operator today. At this time, I would like to welcome everyone to the Carlisle Companies Incorporated Second Quarter Earnings Conference Call. All lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question-and-answer session. Thank you. I will now turn the conference over to Mr. Chris Koch, President and CEO. You may begin your call, Sir. D. Christian Koch - President, Chief Executive Officer & Director: Thank you, Jennifer. Good morning, and welcome to Carlisle Companies' second quarter 2016 conference call. On the phone with me this morning are: Steve Ford, our Chief Financial Officer; Julia Chandler, our Treasurer; and I'd like to welcome for the first time, Titus Ball, our new Chief Accounting Officer. On this call, I'll be discussing our overall second quarter performance and the 2016 outlook, and Steve will review our segment performance, balance sheet and cash flow. Before I discuss our results in more detail, I would ask that you review slide 2 of our presentation entitled Forward Looking Statements and the Use of Non-GAAP Financial Measures. Those considering an investment in Carlisle should read these statements carefully along with reviewing the reports we filed with the SEC before making an investment decision. These reports explain the risks associated with investing in our stock, which is traded on the New York Stock Exchange under the symbol CSL. As announced this morning, Carlisle reported record earnings per share of $1.75 in the quarter, a 22% improvement over the second quarter of 2015. We also generated record EBIT margin of 17.9% in the second quarter. We're extremely pleased with these record earnings. And they're a reflection of our focused efforts to invest in our businesses, pursue acquisitions…

Your first question will come from Jim Giannakouros with Oppenheimer. Jim Giannakouros - Oppenheimer & Co., Inc. (Broker): Good morning, everyone. D. Christian Koch - President, Chief Executive Officer & Director: Good morning, Jim. Steven J. Ford - Vice President & Chief Financial Officer: Hi, Jim. Jim Giannakouros - Oppenheimer & Co., Inc. (Broker): Could you remind us how big the Middle East is in CCM? And also, are there different price-cost dynamics there or materials driving lower mix there versus the experience in the U.S.? Steven J. Ford - Vice President & Chief Financial Officer: Yeah. Well, Jim, the Middle East is relatively small. It's certainly well below 5%, but Middle Eastern sales were down 90%. And just in general, international sales represent 14%, 15% of CCM's total sales, and international sales on a whole were down 28%. And that is why the second quarter ended up only being up 1%. D. Christian Koch - President, Chief Executive Officer & Director: And, Jim, there's no real difference in the raw material base or that dynamic going into the Middle East either. Jim Giannakouros - Oppenheimer & Co., Inc. (Broker): Got it. Well, that down 90% explains it. I thought it was bigger. I wasn't expecting that to be down that much. And in the U.S., was there any pull forward or anything you'd call out in that 5% volume growth? Steven J. Ford - Vice President & Chief Financial Officer: No. No, not really. Very good quarter in the U.S. No real pull forward. Jim Giannakouros - Oppenheimer & Co., Inc. (Broker): And I'm sorry if I missed it in your prepared remarks, did you disclose the price cost impact to margin specifically in CCM? Steven J. Ford - Vice President & Chief Financial Officer: The net was a positive $7 million. Jim Giannakouros - Oppenheimer & Co., Inc. (Broker): Was pricing down in the quarter? Steven J. Ford - Vice President & Chief Financial Officer: Pricing was down about 3%. Jim Giannakouros - Oppenheimer & Co., Inc. (Broker): 3%. Okay. And I'll get back in queue, but one quick one. The $2 million restructuring in CFT, is that expected to be ratable through the second half or is that a 3Q event? Steven J. Ford - Vice President & Chief Financial Officer: We will see approximately the same level of restructuring costs and investments as we move through the rest of the year, Jim. Jim Giannakouros - Oppenheimer & Co., Inc. (Broker): Got it. Thanks, guys.

Your next question is from Joel Tiss with BMO.

Wow! I didn't think I'd make it so quick. D. Christian Koch - President, Chief Executive Officer & Director: Good morning, Joel.

How is it going? I wonder just a little bit of color on a couple of the end markets. Is there any sense that the Ag equipment market is bottoming? That was kind of a small decline relative to what we've seen in prior quarters. And just a quick outlook on the construction equipment end market too. D. Christian Koch - President, Chief Executive Officer & Director: Yeah. On Ag, we like to think it's at a bottom. We've had a tough time, I don't even think we've tried to call it bottom in the past. But we saw lower declines which was positive, but yet we saw layoffs at Deere, Moline this quarter. And so, I think we're cautiously optimistic that maybe we're at the bottom, but I'd hate to call it that. And then on construction, I think there's been some uptick. And as you see that some of the other companies that are in the equipment market, I think Asia-Pacific had a little uptick for the first time in the construction market and I think the U.S. is doing better.

And just on acquisitions, are there anything that's bigger that's out there that make sense for you? Or do you think the way that the pipeline is looking that it's going to continue to be a series of these kind of smaller niche year kind of acquisitions? D. Christian Koch - President, Chief Executive Officer & Director: Joel, we're seeing potential acquisitions of all sizes. I can't really tell you what the next one will be, but they are all out there, big and small.

Yeah. I was just wondering about sort of your roughly billion-dollars worth of easy availability. Is that plenty for what you see out there for the next 18 months or 24 months on your liquidity? D. Christian Koch - President, Chief Executive Officer & Director: Yeah. I think we're fine. And we have plenty of cash and available liquidity to execute whatever strategies we see in the near future.

That's great. Thank you.

Your next question is from Matt McConnell with RBC.

Thank you. Good morning. D. Christian Koch - President, Chief Executive Officer & Director: Good morning.

Just hitting on the decline in Canada. It sounds to me like some of that might have been proactive, and this is in construction materials. Are you proactively walking away from business there? And if so, could you size that just so we understand what kind of drag might be coming in the next couple quarters? Steven J. Ford - Vice President & Chief Financial Officer: Yeah, Joe. In Canada, we were down 35%, 45% year-over-year. And as we noted in the comments, that was because there was a number of low margin projects did not recur. I think we are more disciplined here in 2016 and that's reflected in the quarter. We'd expect that that to continue, although I don't expect the year-over-year decline to be as pronounced in the second half of the year as it was in Q2.

Okay. Great. And then just on the roofing price comment. One of your competitors, I think, was trying to push through an increase. Did you also have any list price increases or just what are you seeing in the marketplace maybe expectations for price over the next couple quarters? D. Christian Koch - President, Chief Executive Officer & Director: Yeah. We saw the pricing action there by one of the competitors and that rolled out, I believe, in July. Our commentary on whether we'd stick or not, I would say, we would classify it as maybe bring more stability to the market. I wouldn't really want to characterize the prices were increasing, but did it brought more stability and pricing to the market. And as we look out, we hope that continues. There has been, as Steve mentioned, some pricing degradation in each quarter this year. We do think it's relatively stable and so that's our outlook.

Okay. Great. And then last one real quick on MS Powder. So, that added about $3 million. I thought the run rate was around $6 million. I know the numbers are kind of small, but did that have a bunch of new products coming or should we expect a run rate higher than the $6 million when you bought it? D. Christian Koch - President, Chief Executive Officer & Director: The demand I think is through the acquisition period here. And end of the second quarter, it's a little bit lumpy. I think your initial estimate at $6 million to $7 million range for the year is probably a good range. And then, I think as we roll out new products, which should come in the third quarter, fourth quarter this year, we should see some uptick as we move into 2017.

Okay. Great. Thank you very much. D. Christian Koch - President, Chief Executive Officer & Director: Yeah.

Your next question is from Ivan Marcuse with KeyBanc Capital Markets.

Hi. Thanks for taking my questions. First one, are you seeing any inflationary raw materials or raw materials remaining fairly stable? And sort of your outlook looking out next quarter or two? D. Christian Koch - President, Chief Executive Officer & Director: Yeah. Raw materials are pretty stable, Ivan. We don't see much happening in that front, at least not increases.

Okay. And for CBF, I know the second half tends to be a lot seasonally weaker at this sort of level of sales or it is another decline of high single digits or maybe, can it stay profitable? D. Christian Koch - President, Chief Executive Officer & Director: Yeah. We'd like to think it'll stay profitable. The team's doing a good job. They've done a good job over the last – well, many quarters now to maintain that. And that's our goal for the second half of the year is to remain positive. Steven J. Ford - Vice President & Chief Financial Officer: And, Ivan, the revenue comparisons get easier second half of the year. So, we would not anticipate double-digit revenues decline year-over-year in Q3 or Q4.

Okay. And then, in CIT, I believe pretty large customer of yours is talking about extending payments, et cetera. Have you seen any impact from that or any, I guess, initial discussions or how do you expect that to impact you going forward? D. Christian Koch - President, Chief Executive Officer & Director: We haven't seen any impact yet. We're very close with that customer, and we're always in discussions. So, we're aware of the things that are happening, but I can't really comment on what would be happening in discussions in the third quarter and fourth quarter. I just say, we haven't seen anything to date.

Great. And last question, the bond that you'll be paying off. Will there be a cost associated with that, or is that built into your, sort of, interest expense outlook? Steven J. Ford - Vice President & Chief Financial Officer: Yeah, there's no costs associated with the retirement of the bond. And, obviously, the interest expense on that note goes away. So, it'll be positive to results, and no incremental cost.

Great. Thanks for taking my questions.

Your next question is from Kevin Hocevar with Northcoast Research.

Hey, good morning guys. D. Christian Koch - President, Chief Executive Officer & Director: Morning, Kevin.

Wondering if you could comment on, you mentioned pricing down 3% in CCM, which is a bit of an acceleration from kind of where it's been. It's been down kind of 1%, 1.5%. So, wondering if you saw some increased competition during the quarter in that segment. Steven J. Ford - Vice President & Chief Financial Officer: Yeah. I think, again, Chris made the comment early about one of our competitors announcing an increase effective for July. We're certainly hopeful that that provides some stability and improves the pricing environment as we head into the second half of the year. I mean, we did see some – again on the pricing side, the pressure is not across the board. It's not all product categories. It tends to be more on the insulation and in certain regions. And again that is what contributed to the 3% decline here in Q2, but we're optimistic with the announced increase by one of our competitors that things will further stabilize.

Got you. Okay. And then, typically, when I look back at margins, margins have been phenomenal in CCM, and when I look from kind of second quarter to third quarter, at least in my model, back about nine years, it looks like it's always increased except – so eight out of last nine years it's increased sequentially. So kind of curious how we should think about margins there. I mean, is it crazy to think margins could be a little higher in the third quarter from where they were in the second quarter, or how should we think about that? Steven J. Ford - Vice President & Chief Financial Officer: Well, Kevin, obviously, the second quarter was truly an exceptional margin quarter for the business. We were up 500 basis points from an outstanding first quarter, and the 23% margin that we recorded here in Q2 was a record. So you need to take that into consideration when you look back at history. And I think as we move into the third quarter that benefit that we've enjoyed from a raw material pricing standpoint, we're not anticipating that same sort of benefit. So it will certainly be a real challenge to improve on Q2's margins in the third quarter.

Got you. Okay. And then, just final question, and maybe I missed this, but in terms of cash deployment, so how should we think of share repurchases going forward? M&A has been pretty active this year, completing a couple acquisitions, and then you're paying off – I think you mentioned you're expecting to pay off that senior note. So, I guess, how do you think of share repurchases the balance of the year? Steven J. Ford - Vice President & Chief Financial Officer: Similar to what you've seen in the first half of this year and what we saw throughout all last year, we are buying on a regular and continuous basis certainly enough shares to avoid any further dilution from equity awards. And I think the level that you've seen in these last six quarters, we'd expect that to continue in the second half of the year.

Okay. Great. Thank you very much.

Your next question is from Neil Frohnapple with Longbow Research.

Hi. Good morning, guys. And congrats on a great quarter. D. Christian Koch - President, Chief Executive Officer & Director: Thanks, Neil.

Regarding the CFT segment, could you talk more about the margin outlook for the back half of this year? Can you give us a sense on whether you would expect margin growth versus the second half of 2015, or will the additional restructuring costs and other initiatives you guys have talked about kind of preclude you from delivering higher profitability? D. Christian Koch - President, Chief Executive Officer & Director: I think you should see some improvement as we go through relative to the first half of the year, but these projects, the vertical integration, the footprint consolidation, the staffing levels, adding salespeople, this kind of thing, moving the headquarters, as it continues, I think we'll be a little bit higher than the first half, but those will have a significant impact going forward.

Got it. And then will the recent rise in steel prices negatively impact any of your segments, such as CFT; obviously, it wouldn't impact CCM, but just trying to get a sense for, in the coming quarters, will you guys see any sort of steel cost inflation in any of the segments? D. Christian Koch - President, Chief Executive Officer & Director: I don't think we'll see any material impact from the steel increases.

Got it. And then one final one. Can you provide any more detail on the Micro-Coax acquisition? Can we think about margins being additive to CIT's overall margin profile longer term? Certainly, it's going to take time for that to occur. And then just could you talk about some of the revenue and cost synergies? I think you mentioned COS is already underway. D. Christian Koch - President, Chief Executive Officer & Director: The COS is underway. We see some opportunities to invest in capital there. Also just bringing in the whole Lean/Sigma toolkit into Micro-Coax will deliver some nice cost savings opportunity in terms of factory layout. When we look to the sales side, there are some very good synergies between our CIT teams and the Micro-Coax teams. We think they have a good, obviously, a good sales force and a good product line, and I think bringing that into the fold just creates more opportunities for us on sales. And we would not expect it to be a dilutive to CIT earnings long-term. If anything with the investment in these space missile defense, unmanned aircraft segments, we would expect them to be a little bit additive.

Great. Thanks very much, guys. D. Christian Koch - President, Chief Executive Officer & Director: Yes.

Your next question is from Josh Chan with Baird. Josh K. Chan - Robert W. Baird & Co., Inc. (Broker): Hi. Good morning. Good quarter. Just a follow-up on Canada. Did the competitive environment there change or did you think about, I guess, margins a little bit differently? Or, can you explain a little bit more about kind of the decision or the strategy to step away more aggressively in that market? D. Christian Koch - President, Chief Executive Officer & Director: Yeah, Josh. Again, this is a very fluid situation. And just based on where we were in the quarter this year compared to last, there were some business that we pursued last year that we just did not feel was an interest to pursue this year. It was lower margin. And again, I think it was the right decision that the business made. It had a negative impact on overall revenues, but it was certainly very positive to product mix. I think the comparison gets a little bit easier in second half of the year. We're not going to have quite the revenues decline in the second half as we did in Q2, but in Q2, I think, it was the right call that the business made and that's reflected in the strong margin performance. Josh K. Chan - Robert W. Baird & Co., Inc. (Broker): Sure. Absolutely. Yeah, you reported very good margin there. And switching over to the Fluid margin comment, it sounds like that some of the improvement initiatives could actually result in somewhat of a step-up in margin at some point. When do you think we'll start to see the benefits of those initiatives? D. Christian Koch - President, Chief Executive Officer & Director: We have already seen some benefits and initiatives. They've been small, but on COS, for example, we're already seeing improvements there. In fact, we'll add on that. The other improvements in investments really are going to be a little bit staged. If you think of the vertical integration that return will occur a lot sooner than something on the order of factory consolidation. So, I think we'll start to see things continue to build in 2017 and 2018 as we execute on those strategies. But, obviously, buying machinery putting it into place, making those major capital expenditures, and then changing the factory footprint takes time. Josh K. Chan - Robert W. Baird & Co., Inc. (Broker): Okay, great. Yeah. Thanks for the color and good quarter. D. Christian Koch - President, Chief Executive Officer & Director: Thank you. Steven J. Ford - Vice President & Chief Financial Officer: Thanks.

Your next question is from Charlie Brady with SunTrust.

Hey. Thanks. Good morning, guys. My first question really is on CIT. With respect to SatCom, sounds like it started shipping a little bit earlier than you had thought. I'm assuming it's pretty small in 2Q, but can you quantify what that was and what's your expectations for SatCom sales for the year? D. Christian Koch - President, Chief Executive Officer & Director: Yeah. It was very small. Some very initial order – the beginning of the initial orders there to be shipped. So, I wouldn't even want to characterize it in dollar terms on the call. Let's just say, it was small, but we did begin shipping. And then about $10 million is our projected for the second half of this year.

Okay. Thanks. And just, can you comment overall on the market in commercial aerospace? You've seen a lot of negative commentary from the air show a week or so ago from Boeing and from Airbus. Airbus cutting back on some of their shipments. Boeing doing the same. It doesn't really seem to be having any impact on your outlook for the aerospace segment. Can you just kind of speak to how you're being insulated from that and what's driving that? D. Christian Koch - President, Chief Executive Officer & Director: Well, I think when you look at the Airbus and Boeing, these are big companies with a big portfolio. We know, for example, Airbus with the A380, there are issues there; they've been widely publicized. We also know there've been issues on engine delivery and other things, but for our big platforms, the 787 and that, we still see good demand. We think those planes are rolling out. They're well accepted in the marketplace. In the long-term, traffic patterns that we see and demand from customers for air travel around the globe just continues to really point towards a very favorable market for us. So I think one of the things is the platforms we're on, one of the things is the market for the planes we're on and then lastly we continue to introduce new products and gain share on planes and a great example is just SatCom and how that CIT team has expanded their presence on the airframe.

Thanks. And just one more and I'll get back in the queue here, just on CIT, I don't know if I missed it or not, but the commentary on lower selling price, can you quantify that? Steven J. Ford - Vice President & Chief Financial Officer: It's about just under 2%, about 1.5%.

Great. Thank you.

Your next question is from Liam Burke with Wunderlich.

Yes. Thank you. Good morning, Chris. Good morning, Steve. D. Christian Koch - President, Chief Executive Officer & Director: Good morning. Steven J. Ford - Vice President & Chief Financial Officer: Hi, Liam.

On the Fluid Technologies side, you had very strong growth organically. You highlighted two geographies outside U.S. Were there any particular verticals within those geographies that were stronger? D. Christian Koch - President, Chief Executive Officer & Director: Really, the core verticals were strong. The transportation, the general industrial were really strong in both those regions.

Okay. Thank you. And just getting back on the pricing on CIT. Is that within any particular vertical? I mean, you quantified it, but is that across the board or within any particular vertical? Steven J. Ford - Vice President & Chief Financial Officer: Combination in commercial aerospace and a little bit on the medical side.

Okay. Great. Thank you. D. Christian Koch - President, Chief Executive Officer & Director: You're welcome.

At this time, there are no further questions. I will now turn the conference back to Mr. Koch for any closing remarks. D. Christian Koch - President, Chief Executive Officer & Director: Thanks, Jennifer. This concludes our second quarter 2016 earnings call. I want to thank everyone your participation, and we look forward to speaking with all of you on our next earnings call. Thanks again.

Thank you, ladies and gentlemen. This does conclude today's conference call. You may now disconnect.