Good afternoon, everyone. My name is Morgan and I will be your conference operator today. Welcome to the Fortune Brands First Quarter 2025 Earnings Conference Call. All lines are muted to prevent background noise. Following the speaker's remarks, we will open the call for a Q&A session. At this time, I will turn the call over to Leigh Avsec, Executive Vice President, External Affairs and Chief of Staff. Leigh, please go ahead.

Good afternoon, everyone, and welcome to the Fortune Brands Innovation's first quarter earnings call. Hopefully, everyone has had the chance to review the earnings release. The earnings release and the audio replay of this call can be found on the investor section of our fbin.com website. I want to remind everyone that the forward-looking statements we make on the call today, either in our prepared remarks or in our associated question-and-answer session, are based on current expectations and market outlook and are subject to certain risks and uncertainties that may cause actual results to differ materially from those currently anticipated. These risks are detailed in our various filings with the SEC. The company does not undertake any obligation to update or revise any forward-looking statements except as required by law. Any references to operating profit or margin, earnings per share, or free cash flow on today's call will focus on our results on a before-charges and gains basis unless otherwise specified. Please visit our website for reconciliations of these non-GAAP financial measures to the most directly comparable GAAP financial measures. With me on the call today are Nick Fink, our Chief Executive Officer, and David Barry, our former Chief Financial Officer and current President of Security and Connected Products. We will also be joined by John Baksht, our new Chief Financial Officer, and Curt Worthington, our new Vice President of Investor Relations and Finance during the Q&A session. Curt is a seasoned IR professional and joins us from Pactiv Evergreen where he worked alongside John. I will continue to be involved in investor relations as part of my role as Head of External Affairs and Chief of Staff, just in a different capacity. I am looking forward to working with Curt to ensure a seamless transition. Following our prepared remarks, we will have allowed time to address some questions. I will now turn the call to Nick. Nick?

Thanks, Leigh, and thank you to those joining our call. On this call, I will discuss the impact of tariffs on our company, summarize our first quarter performance, give an update on a few of our key strategic priorities, and discuss the external macro environment. In addition to giving an overview of our expectations around the impact of tariffs, I will provide some color into the areas where we believe we have opportunities to outperform and grow share. Then Dave will review our financial results and assumptions and give more information on tariffs, our mitigation efforts, and our balance sheet. I would like to take a moment to thank Dave and extend my heartfelt gratitude for his partnership as our CFO. Now, as he fully transitions to his new role of President, Security & Connected Products, I am excited for how he will accelerate our success with that portfolio. I am also pleased to have Fortune Brands' new CFO, John Baksht, join us for Q&A today. John's level of experience as a successful public company CFO is outstanding, and he is quickly learning our business and already providing valuable insights. He and Dave are working closely together to ensure a smooth transition. John is one of several recent, highly talented key hires that we have made as we prepare to consolidate most of our U.S. office associates into one state-of-the-art campus in Deerfield, Illinois. We have been delighted by the quality of talent that we are attracting and now have a world-class leadership team fully in place. Additionally, we are pleased to have many of our existing out-of-state associates willing and able to continue their career journeys with us in Deerfield, with the numbers of associates who have chosen to relocate and remain with the company exceeding benchmarks. Overall, I…

Thank you. Before I begin, I would like to express my heartfelt gratitude to Nick for his exceptional friendship, leadership, and mentorship during my tenure as CFO. As I continue in my new role, the enterprise perspective I have gained as a result of my tenure as CFO will be invaluable, and I know all of our stakeholders are in great hands with John. As a reminder, my comments will focus on results before charges and gains to best reflect ongoing business performance. Additionally, comparisons will be made against the same period last year unless otherwise noted. As Nick mentioned, in light of the uncertainty around price elasticity and the demand environment, we will not be providing our usual detailed guidance for the year, and we have suspended our prior financial and market assumptions. However, I will provide a framework and range for two different EPS scenarios based on different volume assumptions resulting from potential consumer behavior. But first, let me start with our first quarter results. As Nick highlighted, our teams executed our priorities amidst a very dynamic macro environment in which we saw demand slow from mid-February through the end of the quarter and continuing into the second quarter. In the first quarter, sales were $1 billion, down 7%, and down 5% organically, excluding China and FX. Consolidated operating income was $135.8 million, down 19%. Total company operating margin was 13.1%, and earnings per share were $0.66. Our first quarter sales performance was driven by low single-digit POS declines and low single-digit impact from inventory reductions in wholesale and retail channels as consumers and customers reacted to an uncertain economic environment. Beginning with water innovations, sales were $565 million, down 10%, and down 7% organically, excluding the impact of FX and China, which was, as expected, down significantly…

Thanks, Dave. That concludes our prepared remarks. We will now begin taking a limited number of questions. Since there may be a number of you who would like to ask a question, I will ask that you limit your initial questions to two and then re-enter the queue to ask additional questions. I will now turn the call back over to the operator to begin the Q&A session. Operator, can you open the line for questions? Thank you.

[Operator Instructions]. Your first question comes from Phil Ng with Jefferies. Your line is open.

Hey, guys. Dave, congrats on the new row, and John and Curt, looking forward to working with you guys again. I appreciate all the great color. I guess, first off, Nick, a question for you, obviously, a very dynamic environment. You guys announced this transformation effort, kind of moved the headquarter and kind of thinned out the layer of management. How does that kind of progress, and how does that allow you to kind of navigate in this dynamic backdrop?

Well, hey, Phil. Happy to give some perspective around that. Why don't I start just by putting it in context, at least the way I think about it? I think of this as we're in the third of three phases around our transformation. If you think about that kind of first phase, we transformed the portfolio. We spun the cabinets business out, right? Yale, M-Tech acquisition. We also did the acquisition around Springwell, so a lot of portfolio transformation, kind of phase one. Phase two was really the transformation into an operating company, so we could fully leverage our scale, particularly for the digital transformation, but also around marketing, supply chain. I think things that you're really starting to see yield dividends, particularly in this dynamic environment. I'm sure we're going to talk about tariffs a bit, but you can see the speed at which we're going to be able to move, and I think a lot of that is thanks to the fact that we are much more of a consolidated and aligned operating company. And the third phase is really, co-location to drive innovation and performance acceleration. And so we're in the midst of that third phase, which I think will get us to the finish line of this transformation effort. To date, it's a heavy lift. I won't minimize it. It's a heavy lift, but it's going really well. We now know who is coming along to continue their careers with us amongst the impacted population and who isn't, and we turned up actually pretty materially better than industry benchmarks would suggest, and so we were very happy about the talent choosing to relocate to the area and continue their careers with the company. For those not continuing, they've remained very engaged, and our hiring process is…

Super. Super. Appreciate all the color. Dave, on the tariff side of things, great colors. If I heard you correctly, you're fully expecting to offset the 220 impact this year, and then, I guess, on an annualized basis, it's 525. So, number one, how should we think about that 525 being divvied up by segments where you have exposure, and then how much of these mitigate actions you have, whether it's a price increase, cost offsets, and to kind of help us contextualize when this hits your P&L. There's a lag dynamic. It's pretty impressed if you're expecting your downside scenario is 370. That's pretty manageable. Just any color would be helpful.

Yes, thanks, Phil, and thanks for the kind words. I'm happy to give some more color on tariffs. Let me first clean up just the exposure. So, its in-year impact was 200. Annualized was 525. And as we've talked about on prior calls, the teams have anticipated that this environment would likely be coming at us, although it's more extreme. I think we all could have imagined a few quarters ago. So, there's been work underway to move the supply chain. The supply chain moves are the most impactful lever we will deploy. But, as you know, they take time, time to implement, but also then longer time to actually impact the P&L. So, those are underway. We expect supply chain to be more of a mitigating factor as we move late into '25 and into early '26. So, in the meantime, all of our brands across channels are taking price. And I think it's also good to remember that about 65% of our business is through wholesale and or direct to consumer, where we have a better ability to pass through price with ease. And so, successful negotiations with customers on price already, more negotiations ongoing. Price and cost out are going to be the two biggest levers for us this year and feel good about line of sight to delivering that mitigation. Because I think about impact I can break it down a little bit. So, 525 annualized impact, you say about 425 million of that or 80% is China-related. Balance is rest of world. And then looking at segments, water is about 60% of the impact, security 25%, outdoors 15%. We'll start to see P&L impact from the tariffs in this quarter, late in this quarter, but then really ramping third quarter into fourth quarter and see more than 50% of the in-year impact in the fourth quarter. So, pricing coming in now will offset here in the next couple quarters, start to ramp as we go through the year, and then supply chain actions impacting the P&L late this year into next year. So, that's how we're thinking about it. Now, I think in our two scenarios a bit of context around the downside scenario high single digit volume decline implies an acceleration in volume declines from where we are year to date. So, year-to-date, we've seen volume down low single digits. In the first quarter, it's down mid single digits to start the second. So, it would be an acceleration to get to that 370. I mean, I think we, as we think about it, the consumer reaction to what's happening in the external environment remains the biggest unknown for the business, and we can control supply chain. We can control the pricing, our cost out. It's just what's going to happen to the consumer, and that's why we decided to frame our guidance a little bit differently this time and give these two end posts.

Okay. Appreciate all the great color, guys. Thank you so much.

Your next question comes from John Lovallo with UBS. Your line is open.

Good evening, guys, and thanks for taking my questions. The first one is on the digital initiative. I mean, there's certainly a lot of focus and excitement internally on that, and there's been some good progress with the 200,000 activations in the quarter, the major insurance wins, I think Liberty this quarter. I guess the question is, how confident are you in still achieving that 300 million in sales? And along the same lines internally, how do you sort of balance these efforts with continuing to drive the performance in the core business where the market is, for better or worse focused?

John, I'll start a couple thoughts, and then coincidentally, we're very lucky that we got the president of the connected business on the call here today, so I'll let him really dig in and opine. We're obviously super excited about the connected and the digital business, and the performance has been phenomenal. I mean, we talk a lot about flow, the growth rate in the quarter alone, and it's no longer a small business, so I probably get this clip. Dave touched a lot on, in his remarks, on the security business, which had some bumpy laps last year as we really transitioned that from more of kind of mid-cycle startup to a more consistent sort of roll out of new products, but we're really seeing some great performance there and some big new partnerships announced that are really meaningful. The confidence really comes from the fact that these drive a lot of value outside of kind of the normal sort of consumer repair and remodel need, whether it be something like flow that actually takes cost out of the system, right? People are going to have to take cost out of the system no matter the economy. In fact, the tougher the economy, the more likely they're going to be driven to do that, and flow just does that. And our new subscription model that we've just started trialing really allows consumers to do that at a very low entry level. And then you look at on the security side, whether it be through lot of business, which is really actually going to help save lives at the end of the day, and it's hard to put a price on that, or the consumer business, where you could do things like disarm your alarm system with your finger as…

Yes, a couple things I'd add. So one, I'm sorry, just one couple things. So good start to the year, and Han pays to deliver the full year goals. So that's a performance update. I'd keep it that simple. I'd say the team is actually doing a great job of staying focused on opportunities given the challenges in the current environment elsewhere. And Nick talked through in his prepared in his prepared remarks, we have signed new insurance partners, we've launched subscription based pricing test. Additionally, we've qualified another national installation partner for flow, and signed up more than 40 regional carriers, which was a new initiative this quarter to, if we focus on national carriers the past year now moving into the regional carriers and really been adding focus on driving sales activation through the agent base, which is going to the next level of activation that we're doing to drive sales on flow. And then for Yale, we touched on some of the neat partnerships that are coming to launch with ADT. Google is selling, we've also won more than $10 million of placements in retail and e-commerce, which was a focus and a point of synergy from this acquisition to take this brand back through our traditional channels. And we're starting to see that play out and come to fruition. So we're excited about the momentum and on track to deliver our full year estimates.

Great, that's really helpful. And then, so far the feedback that we've received today from investors has been on the water segment and the seeming underperformance versus your large competitor. And POS was down low single digits. I know there's some inventory destock, but I guess the question would be, one, just any more color on that e-commerce pricing strategy that you mentioned, and then any kind of relative share shifts that may be worth noting in the quarter, please.

Yes, I'm happy to give a bit of color on it, and Dave can round it out. But as you look at that, you're right, low single digit declines in POS. We did see a fair amount of inventory come up, particularly from our wholesale channel, I think, in preparation for some softness, and we've probably seen that come through a bit with the builders. And then as we sort of de-segment the low single digit POS declines and look across the feedback from the retailers on our business has actually been very good, particularly of late, where they've been telling us that we're doing better than category. So, I'm going to take that at face value. In e-commerce, we did transition, and we are transitioning through to a firmer pricing strategy so that we can keep our all channels healthy and competitive. But that is a transition as you do it. I mean, you sort of got to force it in one place, and then it takes a while before you see the uptick in the other channels. We also have to make sure that we have all offerings available, matter where the consumer is. So we felt it was a necessary and important thing to do. We noticed with some new analytics, we've gotten a bit out of whack, and now we're transitioning through it. But I acknowledge I think it did cost us some share in e-commerce as we're doing it. But our focus is being a long-term share gainer, and we will do the right things for the health of the brand, even if it means, a trade-off in a quarter or two.

And I would add, John, if you think about the water sales down 10, organic ex-China, FX down seven. Now, Nick talked about that low single-digit POS decline, which is really consistent with what we saw across the rest of the portfolio. I think where we were surprised as the quarter went along was the inventory drawdown, especially in wholesale. It was a mid-single-digit impact on the segment. As we look at weeks of supply with some of our bigger wholesale customers, they're now below any point they've been in the past 18 to 24 months. And so I think it's a sign potentially of softening single-family new construction volume and multi-family new construction volume they're seeing. But that was probably the biggest surprise in the quarter on the water side.

Okay. Thank you, guys.

Your next question comes from Trevor Allinson with Wolfe Research. Your line is open.

Hi. Good evening. Thank you for taking my questions. First one, you talked about reducing your China exposure. I think you said that 10% of COGS by the end of the year. On the $525 million impact in 2026, is that assuming current China exposure or your exposure after you've moved that to 10% of COGS? And then what additional assumptions are there around cost to move products elsewhere? And what other countries are you primarily moving that exposure to?

Yes. Hey, Trevor. This is Dave. I'll start with someone, and then Nick can give some context. On the $525 million number is unmitigated, so before any mitigation action. And so we'd expect to be able to – that number will come down, obviously, as we mitigate, and then we'll update in subsequent quarters how that's progressing. As we looked at supply chain shifts, right, as we talked about, we have a global footprint. We have significant presence in the U.S. and in other North American sites. And so it's leveraging – really finding the best cost position for our customers given our footprint. And those things take time. And there are investments, to your point. Most of the investments, though, are capital – and I'd say a reasonable amount of capital to stand up some assembly lines and production lines in our nearshore facilities. So that's how I think about the incremental cost. I think our capital forecast around that 3% to 4% of sales kind of encompasses that. I wouldn't expect it to be a material number outside of our typical capital range. And then on the cost side, I mean, we're, again, trying to get to a lowest cost position given our network to be able to continue to be competitive and take share in our market.

I'll just add for a bit of context, Trevor. From the strategic perspective and a call out to our supply chain team that have just simply been phenomenal, I've really led – I kind of have said two-part strategy. One is a bet on our U.S. and North American manufacturing footprint. And so as I said in my remarks, 12 U.S. sites, 15 North American sites, that was a decision that was made. I mean, we've been thinking about debating this and preparing this, obviously, for several years now. The other leg to the strategy has been a hyperflexible supply chain. And so as we've debated what to do over the last several years, rather than betting on any particular country, we've bet on making our supply chain hyperflexible so that we could move it about as needed. And you're seeing that come through now in the speed of some of the mitigation that Dave's discussed. And as we've done in other kinds of great dislocation, we really expect that this is going to generate a competitive advantage for us, and we're going to press that advantage to service our customers very well.

Yes, it makes a lot of sense. And then my second question is somewhat related in just your general approach to China here. I mean, there's been speculation that tariff rates could come down here in the not-too-distant future. You've been moving your supply chain out of China for a while. You're accelerating here. Do you change your approach to moving your supply chain if tariff rates on China specifically were to come down significantly? And then a second question would be on your business actually in China, just given everything that's going on between the two countries. Do you have any differing views on that business now that the dynamics have changed between the two countries? Thanks.

I just take this quickly. Firstly, on the moving about, I think the lanes of travel are pretty well set. The amount of tariff may vary greatly, but I think the lines of travel are pretty well set on where this administration expects the supply chain to go from a regionalization standpoint. And as I just said, we're going to maintain a hyper-flexible supply chain and be able to move it around. And at some other point, I'm happy to detail how we do some of that. But there are specific initiatives that we undertake to make it very flexible. But I think the lanes of travel are pretty well set, and we expect it to be shored up and to take advantage of our U.S. footprint. The second part is our business in China is really, at this point, as we said before, China for China. It's manufactured in China. It's for China and sold in China and managed very, very well by a team there. It's organic. It's been homegrown, and they've done a phenomenal job managing it through a lot of disruption over the last few years. I'm not going to predict where that economy goes, but I will say what we were expecting to see was certainly kind of the end of the big disruptions and at least a bottoming out of that business. We'll see if this makes it any worse. But I think strategically, it kind of stays where it is, which is a closed-loop system that still serves that consumer over there and also gives us exposure to a lot of innovation that we see from suppliers in that market.

Yes, I'd just add, as a reminder, this is the last quarter of a challenging comp where we were comping accelerated completions. And so our sales were down in the 30% range in China as expected, but now expect to see a much more stable, not necessarily return to growth, but at least not these 30%, 40% decline quarters in that market. And also, the size of the business makes it much less impactful on the overall fortune results going forward. So we feel like from what we see today, the worst of that is behind us.

Thank you for all the color, and good luck moving forward.

Thank you.

Your next question comes from Susan McClary with Goldman Sachs. Your line is open.

Thank you. Good afternoon, everyone. Thanks for taking the questions. I want to start with your comments around the ability to leverage this environment and the assets that you do have in the U.S. to gain share. Can you talk a bit about how some of those conversations may be starting or areas that you're especially focused on, and how we should think about that coming through over time, and what it could mean for the upside, perhaps, to some of those already really meaningful growth targets that you've set across the various segments?

Yes. Well, we're very focused on it. I would say, never let a disruption go to waste, and we do believe there's a lot of opportunity. I'll start with outdoors. I mean, you look at outdoors business, very vertically integrated through a U.S. manufacturer, and is the leader, particularly the leader in exterior fiberglass stores with manufacturing here in the U.S., capacity that we invested in. And we've seen a lot of competition over the last few years, and frankly, some unfair competition, as we've outlined in our anti-dumping suit from China, that I believe between those two things is going to go away. No matter where tariffs settle, I think that that kind of behavior has been called out, and people are going to need the volume in the marketplace, and we're one of the few that can provide that volume. So that's an example of a place where we think there's a lot of opportunity. There's still a lot of inventory that was dumped into this market that will have to be chewed through, but that's going to happen at some point, and I think people are going to be actually looking for those that can provide consistent, reliable volume. So a big opportunity for that business. I've got to count on Dave's business for a second in the security business. a lot of competition from Chinese brands, entirely sourced product from China in the securities and safes business. We think there's a big opportunity there with our North American manufacturing footprint. And then finally, in water, we've maintained a high level of manufacturing here in the U.S., and that's a very complex supply chain with a lot of moving parts, but we see a lot of opportunity, as we outlined in our mitigation, to really continue to leverage and grow the U.S. North American footprint that we have to serve customers. And ultimately, when you look at all this mitigation we're talking about, we're talking about doing it with just single price adjustments on average across the portfolio, which is really very modest for the amount of dollars we're mitigating. And so we think that in and of itself will give us a competitive advantage in addition to being able to supply consistently through any disruptions, have that footprint, the fact that we can do it at what is going to be a fairly modest relative to other price increases is going to give us an opportunity across the portfolio.

Yes, okay. That's great color. And then turning to security, the margin there really outperformed nicely relative to what we had in our model and appreciating some of the current operating pressures that are coming through. But any thoughts on some of the cost benefits that you're seeing there and anything on how we should think about the path forward over time as some of those benefits continue to come in?

Hey, Suze, Dave. As we've talked about with security, now that Yale is in that segment, the margins can be a bit lumpier quarter to quarter just based on investment patterns within that business and new customer launches. The core Master Lock margins remain very strong, right, in that high teens level. And then as we as we invest behind Yale, the margin could fluctuate and it might move a few hundred basis points over the quarters based on our expectations, so nothing that we're seeing that's unusual. We are continuing to invest there. And they highlighted the brand campaigns that we've launched for SentrySafe and Master Lock. It's Master Lock's first campaign in decades. And we immediately, you can watch our website traffic and our brand metrics start to spike in the market. So it's resonating with consumers. And we'll continue to lean in that. We're driving some new innovations for all three brands with Master Lock, SentrySafe, and Yale having launched new products or having new products coming later this year. So you're seeing this margin a bit of the investment cycle timing, predominantly for Yale with a very healthy core Master Lock business underneath.

And I'll just add just to put in some context, I mean, this is that was part of a multi-year plan. we looked at that business and we said the brains in that business were far too solid, beautiful, great brains that we had for us not to be investing behind them, but we were not going to be investing behind them at the margins that the business used to have, as you recall, you've tracked us for a long time. And so, we undertook even going back to our investor today to do a lot of work to replatform that whole business to really healthy margins so we could start to invest in innovation and branding. And that is just coming to the marketplace now, right? So it takes a while, but we're really excited that not only did we deliver that margin journey, but we did it in a way that's actually allowed us to reinvest in a significant way behind the business.

Yes. Okay. Thank you all for the comments and good luck.

Thank you.

Your next question comes from Michael Rehaut with Fortune Brands. Your line is open.

Thanks, Mike Rehaut with JP Morgan, not joining the company.

Welcome to the team.

You didn't realize how much the new headquarters would change personnel, I guess. I'd love to try and delve in a little bit more in terms of at least the guidance framework. And in particular, a couple of aspects one, looks like you're baking in, in this 370 to 420 framework, a high mid single digit price increase to offset tariffs. It looks like if you just do the back of the envelope math, on your sales base, that's about $230 million, which would exceed the 200 million that you expect to hit you this year in tariffs. So I know you had also talked about cost reductions. And I'm just curious if those numbers are right, because it would seem like the pricing is more than offsetting the tariff headwind. And also just a second element to the pricing question, or to the guidance question, it looks like you're also even without the negative impacts of the potentiality around volume being impacted by tariffs, that that volume is coming in a little bit softer than expected. Just given that the high end of the impact, maybe the high end of the framework is still below your prior guidance, so just trying to understand some of the moving pieces there?

Yes, Mike, it's Dave, I'll try to put it into context. On the pricing side, I think if you're kind of lower in the range of mid single digit, you probably get to a more realistic number of where we'll be still in that mid single digit range. And then, that as that comes across the year, there'll be different realization levels and timing. And so it'll, it'll flow through a bit differently as it comes across. So there will be then cost out and supply chain activities that help that. On the two scenarios, I'd say a couple things on volume. Recall from our prior guidance that the second half has easier comps. We exited some low margin product, right? China flattens out. We had the issue with the security distributions that are going offline in the fourth quarter. So they're, they get better on like the comp perspective in the second half from a volume, year over year volume comparison. And the next day, as we think about the volume scenarios with the downside scenario at 370 and high single digit volume declines, we'd be looking to target decrementals on the volume in the mid twenties or better. And that's where the cost leverage that Nick outlined come into play. And so if we see volume trending that way, we can pull back on hiring and reduce some SG&A. And that would be our target from a volume standpoint.

Okay. No, no, that's helpful. And I guess secondly, just maybe zeroing a little bit into the upcoming quarter, the second quarter, you had said that sales were on track to be down, I believe mid single digits, if I heard that right. Any other type of framework around how to think about 2Q either by segment and also from a margin standpoint?

Yes, happy to give it at the Fortune level. I think we see sales down in that low to mid single digit range, Mike, as you, as you mentioned, that's roughly in line with quarter trends where we see POS down in that four-ish percent range. It does imply sequential growth. We're not right now seeing inventory moves one way or another, really. There isn't a lot of pre-pricing buys and we don't see any inventory reductions. The other unusual item I'd call out in the quarter is around the tax rate. And because we are repatriating about $100 million of cash from China as a one-time dividend, our tax rate is going to approach 30% in the quarter. And that's going to be unusual given where we've been historically. So I just want to make sure I call that out for the group.

Okay, very good. Thank you very much.

This concludes the Q&A session. I'll now turn the call back over to Nick Fink for closing remarks.

All right. Well, thanks, everyone, for joining us today. And thank you for your thoughtful questions as we navigate a choppy environment but do our very best to put this company on some really good footing. And we see some solid advantages we can take advantage of. And thank you also for welcoming John and Curt to their first call.

Thanks, Nick. I'm really thrilled to be here. I'm joining at a really exciting time with the transformation underway and the move to the new headquarters. I see an enormous opportunity at Fortune Brands Innovations and I look forward to speaking with many of you on the call today in the future.

Well, we're delighted you joined. And I'll just say we had a lot of interest for John's role. We set a very, very high bar and John cleared it easily. So we're very excited to have John and Curt on board. And I'll just say as we continue to progress on this ongoing transformation, John, Dave, Curt, and Leigh are all emblematic of the phenomenal talent that we can both attract and retain in this business. And so I have full confidence that with the very strong team we have, we're going to navigate choppy waters ahead and deliver ahead of competitors for our customers while seizing the opportunities that disruption inevitably creates. So with that, thank you.

Thank you for joining today's conference call. You may now disconnect.