Good morning. My name is Tracy, and I will be your conference operator today. At this time, I would like to welcome everyone to the Ingersoll-Rand Fourth Quarter and Fiscal Year 2016 Earnings Conference Call. Thank you. Now I would like to introduce Mr. Zac Nagle, Vice President of Investor Relations. You may begin your conference.

Thanks operator. Good morning and thank you for joining us for Ingersoll-Rand's fourth quarter and fiscal year 2016 earnings conference call. This call is also being webcast on our website at ingersollrand.com, where you will find the accompanying presentation. We're also recording and archiving this call on our website. Please go to slide 2. Statements made in today's call that are not historical facts are considered forward-looking statements and are made pursuant to the Safe Harbor provisions of federal securities law. Please see our SEC filings for a description of some of the factors that may cause actual results to differ materially from anticipated results. This presentation also includes non-GAAP measures, which are explained in the financial tables attached to our news release. The participants on this morning's call are Mike Lamach, Chairman and CEO and Sue Carter, Senior Vice President and CFO. With that, please go to slide 3, and I'll turn the call over to Mike.

Thanks, Zac, and thank you to everyone for joining us today. 2016 was another great year for Ingersoll-Rand, a record year, and we hit the mark in all the critical financial metrics. We'll get into some more detail on that in just a minute. I'd like to start this morning by talking about our business strategy, and how that has enabled us to deliver another year of top tier performance in 2016. Then Sue will discuss performance in the fourth quarter. We'll give some color on our 2017 markets and guidance, and I'll close with addressing topics we know are on the minds of investors before Sue and I take your questions. As I said, 2016 was a record year for Ingersoll-Rand. It follows a multi-year pattern of consistently strong operating and financial performance driven by our strategic framework of sustained growth, operational excellence, excellent cash flow conversion and a commitment to our winning culture. Our strategic objective is to drive profitable growth through leadership positions in growing markets that are durable because they address a global imperative, to dramatically reduce energy demand and resource constraints in buildings, homes, industrial and transport markets around the world. Turning to slide four, in 2016 we extended our multi-year record of top quartile performance on organic revenue growth, incremental margins, earnings growth, free cash flow and total shareholder return. We delivered free cash flow of approximately $1.3 billion and 3% organic revenue growth and operating margin expansion of 60 basis points to 11.6%. Free cash flow was 121% of adjusted net income and more than $5 per outstanding share. Adjusted operating margin leverage was 44%. Adjusted continuing EPS of $4.13 was up 11%, demonstrating the strong leverage of the business. We also retained a strong balance sheet with good optionality, while at the…

Thank you, Mike. Please go to slide number 6. I'd like to begin with a summary of main points to take away from today's call. As Mike discussed, 2016 was a very strong year for Ingersoll-Rand and marked another year of continued top tier performance on free cash flow, organic revenue growth, operating margin improvement and earnings per share growth. While we recognize the fourth quarter contained more one-offs and noise than any of us would have liked and distorted our fourth quarter earnings report, fundamentally, it was still a strong quarter for the company relative to our core businesses. There shouldn't be any significant read through to our go-forward results. Free cash flow was more than $350 million in the quarter, bringing our 2016 free cash flow to $1.35 billion, which is up 37% versus 2015 or more than 120% of our adjusted net income. From a segment perspective, the combined Climate and Industrial segments' adjusted operating income results were solid and a bit better than our expectations for the quarter. Our bookings performance was very strong, with commercial and residential HVAC leading the way, with both at low teens growth. Residential revenues increased low teens. Operating margins also expanded in both businesses. We were pleased with our Industrial business performance which showed slow but steady adjusted margin improvement after hitting a low in the first quarter. We continued to take additional actions on operational excellence initiatives, increased commercial focus on aftermarket parts and service offerings, and took additional cost reduction activities to improve operating results going forward. EPS in the quarter was negatively impacted by discrete items in G&A, negative other operating income and taxes, as I'll discuss on the next slide. Please go to slide 7. We've provided a bridge from the fourth quarter guidance range we…

Thanks, Sue. And if you move to slide 17, we'll begin our guidance conversation with some color around our end markets. As always, our intention is to give you our best view as we know it today and how that translates to our revenue outlook for 2017. We've broken it down by major end markets and geographies. We expect North American commercial HVAC and residential HVAC to show continuing growth. In North America, 50% of our commercial business is parts, service and controls, and we're seeing strong demand in all these areas as well as through upgrades and energy retrofits. Residential replacement, which makes up approximately 80% of the total market, closed the year on a strong note and we expect to see continuing growth next year in both replacement and new construction. Commercial HVAC markets in EMEA and Asia are expected to be flat. We expect Latin America to be up mid to high single digits. Transport markets in the Americas will be down from lower volumes for trailers and auxiliary power units, partially offset by trucks. North American trailer volumes are expected to decline by low teens. Transport in Europe is expected to be up based on truck and trailer sales and a bottoming of the marine container market. Asia Pacific was up high teens last year and we expect continued growth in 2017 on its smaller base. Global industrial markets are generally improving, but still remain soft. We believe we are seeing a bottoming trend in our general industrial markets in the US and the Eurozone as PMIs have improved over the last several months. We have also seen some order improvement in our short cycle industrial businesses. While this is a positive, the modest rise in industrial production for just a gradual recovery with bumps along…

Thanks, Mike. Please go to slide 18. Moving on to our guidance, we expect total organic revenues to be up approximately 3% in 2017. We expect the Climate segment to continue to show good growth of approximately 4% organic. For the Industrial segment, we expect the markets overall to be pretty flat, but for our organic revenues to be down slightly given the high volume of large compressors we shipped out of backlog in 2016, which will make for tougher compares in 2017. The difference between our organic and reported revenue contemplates about 1 percentage point of negative foreign exchange from a strengthening US dollar outlook. For the enterprise, we expect adjusted operating margins of between 12.2% and 12.6%. We expect adjusted operating margins for the Climate segment to be in the range of 14.5% to 15%, and in the range of 11% to 12% for the Industrial segment. Please go to slide 19. We expect continuing adjusted earnings per share for 2017 to be in the range of $4.30 to $4.50 excluding about $0.15 of restructuring. The company also provides the following guidance. Share count is expected to be approximately 262 million shares. Target free cash flow is 100% of net income. The tax rate is expected to be between 21% and 22%. Corporate, general and administrative expenses are expected to be approximately $240 million and capital expenditures are expected to be approximately $250 million. Please go to slide 20. Relative to the company's plans for capital allocation investing, in the business is our highest priority, so we continue to make investments in innovation and growth in things like wireless and digital and connected capabilities, productivity, sustainability and in our employees just to name a few areas. Paying a highly competitive dividend is also a key priority for us and based on our most recent dividend raise last October to $1.60 per share, we expect to spend approximately $420 million on dividends in 2017. In 2017, we're also targeting spending approximately $1.5 billion between a combination of share buybacks and acquisitions. Maintaining a strong balance sheet also remains a priority and provides us optionality as our markets continue to evolve. Let's go to slide 21. And now, I'd like to turn the call back over to Mike to discuss a few of the key topics we know are on the minds of investors as we enter 2017.

Thanks, Sue. The first topic to discuss is our US manufacturing base. I think you're all aware, we operate on a region of use philosophy. We localize manufacturing and the supply chain to help us achieve greater speed to market and implement local product preferences. 95% of Ingersoll-Rand products sold in the US are manufactured in the US. Regarding components, we're likely less exposed as compared to other diversified industrials, because of our focus on lean and in particular cycle time reduction. We've actually through the years been willing to sacrifice some price for faster delivery, meaning the source is coming from within the US. I think this issue is a bigger issue for companies that are importing finished goods into the US, such as consumer products or electronic companies. We are definitely a net exporter. The second topic is around the US corporate tax rate. As you know, approximately 65% of our revenues are derived from the US and therefore, we pay a significant amount of US corporate taxes. If there is a reduction in the US corporate tax rate, we would expect to benefit from it. Turning to slide 22. I know we'll receive questions on the status of Industrial. Fourth quarter was above the guidance we gave in revenue and operating margin. We saw growth in several vertical markets, including food, pharma and tech, as well as with our compressor aftermarket business, which was up 3% as I mentioned earlier. However, we continue to see soft markets on large compressors and in the energy markets. We have seen some bottoming with orders for our shorter-cycle businesses, such as power tools and fluid management, both up in the fourth quarter. As I indicated earlier, we expect the industrial markets to stabilize in 2017, although we cannot declare a…

Your first question comes from the line of Shannon O'Callaghan from UBS. Your line is now open.

Good morning, guys.

Good morning, Shannon.

Good morning.

Hey, Mike or maybe Sue, on the free cash flow, just remind us why it was so particularly strong in 2016. I mean the working capital performance is great. It looks like CapEx was a little bit lower. You're bringing that up. Just maybe refresh us on the dynamics of why you see that still being strong in 2017, but not quite the conversion of 2016.

Shannon, that's a great question for us. Free cash flow was really strong in 2016 because we really focused on all of the basic fundamentals. What we wanted was we wanted our operating income to flow through to cash flow. So, we were very focused on making sure that on the accounts receivable side that our terms for our customers were balanced with our terms for our suppliers. We went after disputes. We went and talked to our customers that had past-dues. We worked with the supply base on accounts payable terms, and we also did a lot of work on our inventory processes as part of the business operating system. So we really, really focused on getting the operating income to drop through, getting the working capital to a level that was not only good, but also sustainable. And then our spending on other items, we didn't limit anything on CapEx, to your point. We didn't do anything like that. We asked for good investments as a part of the business. So, we actually used free cash flow in a very good way in 2016 and we had a very good result. And I think another point to give you on – not only was free cash flow excellent based on the performance of each of our businesses and the corporate folks, but it was also pretty evenly measured throughout 2016 as opposed to being a very lumpy free cash flow. So, I think everything came together for that in 2016.

Sue won't say this, but I'll say it. She did a great job and her team training the organization on something we had fun with called in the know on cash flow. We had everybody in the organization go through that with the purpose to explain that everybody in the company has got something to do with cash flow, and people got excited about its stories. We were really kind of pushing through, and I think that level of engagement is a factor, somewhere it made a big difference around people really exceeding this.

And then, Mike, maybe on the strength in those Climate bookings, I mean up 10% organic, it looks like you're gaining share in a lot of new product investments. When you look across either the product type as applied, unitary, or the regions, any particular area that you feel you're particularly well positioned in terms of share gain?

Shannon, it was amazing in that it was across the globe, and it was across unitary, applied, controls and service. So I mean, it was just across the board. We didn't have a single pocket of weakness really anywhere in the world which is reassuring to us, and that's a broad-based approach. And that I think gave us confidence around the guide we gave for the year around pretty good growth continuing into 2017.

Okay, great. Thanks.

Thank you.

Your next question comes from the line of Nigel Coe with Morgan Stanley. Your line is now open. Nigel Coe - Morgan Stanley & Co. LLC: Yeah, thanks. Good morning, guys. Great detail by the way, appreciate all the extra color in the slides. So, I just wanted to come back to Shannon's question on the outgrowth. It does feel like you're gaining share pretty much across the board, so a question that comes up a lot is, how sustainable is that dynamic. And maybe if you just touch on what do you think is driving that outgrowth in particularly within commercial HVAC? And then, equally it does feel like you're lagging your big competitor in compression. Maybe just touch on that as well, Mike.

Yeah, first I would say, Nigel, that you have to go back and realize that it's been investments sustained over time and product launches have been occurring at a high rate for some time. I think we've got the best channel in the world in terms of the people out there that are systems experts, capable of bringing stuff to the market. And we've got the largest that we know of field service force in the world around HVA systems, over 4,500 people out delivering that are employees of the company. And you combine that all together with investments in digital, and I feel like it's been not a flash in the pan around something happening in the fourth quarter. It's been good for a long time. And it's up to us to continue to innovate and to continue invest in the channel. Half the investments or more that we're making in 2017, again go back into the channel itself, not just into product. When you look at a compression technologies, similar investments happening there and we're seeing good growth on the service side. You had asked reference to Copco. You have to look at Copco, when there's a 5 point swing just in currency, Copco would have shown a 3 point gain. We show a 2 point headwind in currency, 5 point in net. When we back out and look at the organic growth, I think they were minus 5, we were minus 4. There's always subtleties in the business, but look, we're all I think in the compressor business looking forward to brighter days. I don't think there's a read through when you do the side-by-side math between Copco and us around a difference in performance. Nigel Coe - Morgan Stanley & Co. LLC: Okay. That was really helpful. And then on the capital allocation, the $1.5 billion of the target, what does that mean? Does that mean that there's ambition to deploy that amount, but if there's an opportunity, you won't? And how do you think about that toggle between M&A and share buybacks? And this time next year, if you haven't deployed that capital, why would that be?

Yeah. I think you had it right in your note this morning, Nigel. $1.5 billion is what we're saying we're targeting to deploy in 2017, and $250 million of that, we've already said look, that's going to control any kind of dilution in share count. Leaves $1.25 billion left, and we're going to be really smart about how to deploy that. So very patient, very selective around the M&A front. And we're going to be patient around share repurchase. But between the two, we expect to deploy $1.25 billion and we're just going to update you as you go through the year. It's difficult to forecast that on an EPS basis, because certainly on share count, it matters when and where you buy shares during the year as they're averaged back in. And M&A clearly on a GAAP basis, EPS accretion is difficult to see in a partial year, maybe even within the first full year. So it's difficult to forecast that. It's dependent on the actual target. Nigel Coe - Morgan Stanley & Co. LLC: Okay. That's helpful. Thanks.

Your next question comes from the line of Steve Tusa from JPMorgan. Your line is now open.

Yeah. Hey, guys. Good morning.

Good morning, Steve.

Good morning.

Just a follow-up to Shannon's question on free cash flow. I mean, you talked about how you kind of focused this year on all these moving parts. I guess, is 2017, was there some pull forward into 2016? 2017 is down. I wouldn't have expected it to be down that much. You've talked about the conversion rate as being sustainable and obviously above 100% is good, but just down year over year by the magnitude. Just curious if there is anything unusual about that 2016 performance?

No. There was really nothing that was unusual about the 2016 performance, Steve. What I did as I looked at 2017 is I did a couple of things. One, on working capital, I was really allowing working capital to go back up to around the 4% level, and I'll tell you why. As our markets are a little bit lumpy, choppy, some of them recovering, I want to make sure that our businesses have the option to have inventory on hand so that not only can we meet customer requirements, but that we can meet on-time delivery requirements. So, I'm giving us room for a little more working capital and really I'm primarily talking about inventory in terms of 2017. The other part of that is our capital expenditures are actually going up a bit year over year. I gave you a guide of $250 million. And really the majority of the increase in the CapEx year over year is really in our factories, in productivity producing projects and things like primarily precision machining and in the factory. So, I gave a little room for all of that and that really takes it down to the $1.1 billion to $1.2 billion level.

Okay. That make some sense. And then the restructuring you guys are doing, it's a bit of a step up. Just curious as to why you're stepping that up now given the strong kind of volume picture on orders. Where specifically is that going?

Steve, so fundamentally on that, we're really going to discuss sort of where that's going as we deploy it because we want to make sure that we're in front of that internally versus speaking to it externally. But in a lot of the cases where we've been sort of on the fence with doing some things, we've found opportunities within those business cases. Examples might be where real estate values would have changed on the underlying idea and so there might be an opportunity to consolidate a footprint that we didn't have in the past. So there's a fair bit of that going on as well. So we've got sort of ideas around that $50 million and we're going to update you as we go, but it's a good placeholder for now. And you know what, Steve?

And the payback on that? And the payback on that?

Yeah so, yeah well on the $50 million, we'll probably see $10 million in 2017 and then we'll go to something more full run rate, probably $20 million in 2018 on that $50 million.

Great. And then one last question, just on the first quarter, maybe my clients are going to hate me because they don't want guidance anymore, but I think it's good to at least have a nice framework out there. Normal seasonality, at least how we calculate it, that gets me into the kind of the low to mid 50s from an EPS perspective. Is that too far off?

From a seasonality perspective, Steve, we went back over five years and we're pretty much now I think dialing in. So first quarter usually is kind of 10% to 12% of the EPS for the year, and then we're kind of a front half/back half, 45%, 55% sort of company. You shouldn't get too far off with that sort of math going. Steve, before you're cut off too, I want to thank for spending as much time as you did at the ASHRAE show with our team. They really appreciated you stopping and spending time with them.

Thanks. I love HVAC. You know that.

We do too.

Your next question comes from the line of Joe Ritchie, Goldman Sachs. Your line is now open. Joe Ritchie - Goldman Sachs & Co.: Hey, good morning, guys.

Good morning. Joe Ritchie - Goldman Sachs & Co.: First, so I guess my first question is that maybe just touch a little bit on price/cost, clearly a little bit of a headwind in 4Q. And talk a little bit about what kind of pricing you think you can get through across your portfolio in 2017, and to the extent that you can talk about cadence, that would be helpful as well.

Sure, Joe, let me start out and give you some basic parameters around this. So we knew going into Q4 that we were going to be in an inflationary environment for steel. Pricing did not offset the inflation in the fourth quarter, so we were down 40 basis points as you saw on the slides and heard from our commentary. As we look at 2017, we've got that currently pegged at price over material inflation at about 10 basis points. Really working towards trying to get back to our norm of 20 to 30 basis points. But let me talk a little about what's happening in 2017. So if you think about what drives the material inflation, it's really all around steel, the nonferrous, so the copper and the aluminum. First of all, we're locked about 68% on copper going into 2017, but those should be relatively flat, so neither inflationary or deflationary as we see it right now. Steel has two components to it, one of which is just the raw commodity that's there. And then an even bigger part of that is actually the Tier 2 materials that contain steel that become inflationary. And one of the questions that I ask our group and wanted to pass on as we think about that is, my question was can we just really negotiate with the supply base. And part of this is really on how we've done contracts and written in escalation clauses. So long story short, steel and components that contains steel are going to be inflationary in 2017. And like I say, we'll continue to work price as we go throughout the organization. Now, when you think about price and you think about different areas, we've been successful at getting price in both of our segments in 2016. And I think we'll get price in both segments in 2017. Asia is going to be tough. That one's an interesting market. Some of the others, again price is not for us just a catalog and a price on a particular item. We're baking price into every engineered to order type of project as we go along. So again, pricing is going to be a work in progress. I think there is going to be a little pressure on that as we go into 2017, but inflation comes from steel.

And Joe, recognizing you've been with us now a couple of years, but if you go back all the way to 2010, I know personally even late 2009, we put in place and have been adapting and in training to all the methods and tools for pricing and systems around the company. So there is a lot of rigor in the operating system around that. A lot of reporting and remediation around that, mitigation around that. So on a topic like this, you'd have to go back to a seven year record of every year, being able to deliver on that. I don't suggest that it's going to change in 2017. So it's a little bit here on the benefit of the doubt associated with the tools and the methods of training that we've done over the years. Joe Ritchie - Goldman Sachs & Co.: No, that's helpful, both you guys. I guess maybe my one follow-up, maybe just switching gears to like Thermo for a second. Orders turned positive this quarter. I know that you're calling for North America truck/trailer to be down low teens in 2017. Your largest competitor, who we just saw at the same conference, I think is forecasting down mid single digits. Is there any reason why there would be either a lag or a change in the trajectory that either of you see for 2017?

Well, there are two factors that always play here, one is around which set of customers are buying and which are not, and you will see anomalies quarter-to-quarter about kind of who came to the table. So in the fourth quarter, certainly our customers came to the table and placed orders, which is great. The second really piece of this thing is that it's awfully early to call ACT, (48:08) saying 43,000 units. We've got about 40,000. If you went right back to ACT (48:15), now you are sort of in that range that our competitor would have outlined for you. We tend to think historically, with the exception of last year, that they've kind of met in the middle somewhere. So, we're a little bit more conservative around a 40,000 unit ACT (48:28) number versus 43,000, and that's probably explaining the difference in how we're seeing the market. Joe Ritchie - Goldman Sachs & Co.: That's fair enough. Thanks guys.

Thank you.

Your next question comes from the line of Andrew Obin with Bank of America. Your line is now open.

Yes, good morning guys.

Good morning, Andrew.

Good morning.

Just a question about the fourth quarter reinvestment on security and IT. A, could you just talk a little bit more about it? And second, I'm just really curious, what was the timing of the decision to make this reinvestment? And what I am trying to understand, we're starting to get a sense that companies are getting more comfortable with growth and actually for the first time in several years are choosing to put money into the businesses again. And I was just trying to understand if that's what's happening at Ingersoll-Rand or if there was something else.

Yeah. One of the things, Andrew, when it comes to infrastructure and cyber security, which are often related, I think once you have the idea that you need to do something or want to do something, I think that common thinking would be that sooner is typically better than later. If you think that you've got something you want to plug, that's generally sort of the thought process, the management decision to do that. It's also why frankly you should also always understand, we're trying to do the right things for the long run, not for the quarter. So that in and of itself may not have been the difference. I mean, it was more the other discrete items that are difficult, but not impossible, to forecast, stock-based comp, incentive comp certainly fit that, tax by legal entity as opposed to tax by geography or business unit is more nuanced. But that's one where generally speaking, if you need to spend it, sooner is typically better than later. And that's been our approach.

And I would add just a little bit to that, Andrew, in terms of if you look at the full year of 2016, we started out the year, and we obviously talk pretty regularly to all of the teams around the company. And we really said, don't let our costs get out ahead of what the revenue profile is. So if you looked at corporate costs for really the first three quarters of 2016, you would see that our run rate was actually under what would be typical for a $240 million year. That doesn't mean that because you're under, you should go out and do some things. But it also adds to part of the thinking, when you get to an area where you have some items that you need to spend money on, you go forward and say for the year, our costs, whether it's in IT, whether it's in legal, HR, finance, whatever part of our functional spending are actually flat from 2015 to 2016 and actually will be flat into 2017. So, there's also a little bit of a timing element that is a part of that too. Doesn't explain the difference in the guidance, but I also wanted to give you some context of what we were thinking as we went into the fourth quarter.

And just to be clear in what Sue said, so 2015, 2016 and 2017, the core functional costs have been absolutely flat, which has been our objective, what we're driving to. All the swing you see are in things like stock-based comp, pensions, adjustments that are really happening sort of around those core functional costs.

Got you. The other thing, you made a specific commentary about seasonality on industrial in 2017. And you did call it out, and so what's different versus history on this quarterly variability in the industrial business?

Andrew, the only comparison I think we made was comparing Q4 2016 to Q4 2015, because Q4 2015 had that mammoth load of Cameron shipments, which drove the difficult comp for quarter four. Not a lot of seasonality in industrial beyond that, that we would call out, with the exception that for some reason with large compressors, the kind that are put into gas and energy applications, have tended to been more fourth quarter loaded. But I'm not sure that that's an actual seasonal phenomenon as opposed to sort of when we're booking and shipping orders.

So just to correct, I guess I misunderstood. So, there is nothing different about industrial seasonality in 2017?

No, Andrew. I think the comment that we were actually making, and perhaps we didn't make it as well as we thought, was that what we didn't want anyone to do was to take and draw a straight line on margin improvement each and every quarter in the industrial business. We were saying that it could be a little bit lumpy from quarter to quarter, and would follow its typical pattern. So we just didn't want anybody to get concerned if there was some variation there. So, it was a pretty simple comment that might have been confusing.

Terrific. Thank you so much.

Thanks, Andrew.

Your next question comes from the line of Deane Dray with RBC. Your line is now open.

Thank you. Good morning, everyone.

Good morning, Deane.

Hey, I was hoping to get a little bit more color on the residential bookings at up low teens, maybe some color regarding the product, the mix, where the SEER preferences look to be in 2017 and was there any pre-buy involved.

No pre-buy involved, but yeah, I think you know that the res product is fundamentally 100% new over the past three years. We've got just a few little things we're tweaking. And we've found that as the mix has moved to 14 SEER and above, this is playing really well in our dealer base. So I think this is just going back to the commercial discussion. It's been long-term investment and getting the product portfolio right, long-term investment on repositioning our dealer base to be able to sell low, medium and high price point product, penetration into the residential construction market, penetration into the owner occupied but non-resident market which is another market that we've had some good success with. So again, just good hard product development, channel development and sticking to a strategy here over the long run.

And I think, Deane, from you asked the question on SEER. So as we went through 2016, the 14, the 13 and 14 SEER kind of combined for roughly about 50% of our revenues, and then the 15 SEER and greater was a smaller percent. So really, what you saw was the 13 SEER go into the 14 SEER product and the 15 SEER and above sort of stay the same.

Got it. And then just as a follow-up, there was an interesting development recently with your primary competitor in golf carts, investing in Arctic Cat. So does that change your thinking in any way of how you want to be positioned? You did mention the new product launch of Onward. I went online just now and took a look at. Those just look pretty cool rims for a golf cart, but looks like it's an organic focus for you all with Club Cart. But maybe some comments there.

Yeah, it looks better with the lift kit too, Deane, so look at that picture. That's what you need is big wheels and a lift kit. That's what I'm going to get. Anyway, yeah, no, it's an organic focus, because we think the brand's got legs. We think that we've always focused on consumer on golf and utility, and it's a real concerted effort to penetrate the consumer low-speed vehicle market and personal vehicle market, not – this is golf and car communities, small vehicle communities, this is hospitality and recreation venues. This isn't 65 miles an hour running through rough country.

Got it. Thank you.

Welcome.

Your next question comes from the line of Andrew Kaplowitz with Citi. Your line is now open.

Good morning, guys. This is Seth Girsky on for Andy.

Hey, Seth.

Last quarter you talked about expecting Asia HVAC market to be flat to down in 2017 and 3Q bookings were flat, but bookings in Asia HVAC were high teens this quarter. So can you talk about what your expectations are for Asia HVAC in 2017?

Well, it was a really great fourth quarter. I think that you're going to see sort of a more moderate view toward Asia, kind of mid single digit in Asia for the full year. So it just happened to be the opportunity to book a tremendous amount of orders with a small group of customers that are buying large, and it's going to be lumpy. But I still think it's going to be a cycle and you're going to see sort of mid single digit at the end of the day.

Got it. That makes sense. And then in the Industrial segment, material handlings seems to still be under pressure. But can you talk about your visibility to bottoming in the material handling market as oil prices continue to recover?

Yeah. It has to do with really the count of offshore rigs increasing. That's probably the biggest determinant. Land rigs have an effect, but the content that we provide in the land rig versus an offshore rig are going to be dramatically different. So, I'm pleased to see really utilization of offshore rigs. You're not going to see a full recovery in that business. Incredible margins, fantastic business, that's why it hurts when it's actually down. You really have a dramatic effect on the margins for the segment. Frankly, it's about 1 point in the fourth quarter, so small business, big impact. We love it when it's up; it hurts when it's down.

Got it. Thanks so much.

Your next question comes from the line of Steven Winoker with Bernstein. Your line is open. Steven Eric Winoker - Sanford C. Bernstein & Co. LLC: Thanks for fitting me in, appreciate it. I'm over at ASHRAE right now, and one of the things that strikes me is no matter, most people I talk to, they are seeing growth in VRF in North America on the order of 15% to 20%, depending on how you count it. I know you've talked in the past about maybe I think it's 25% of that market volume going through your channels, but one thing that's been apparent is, a lot of that is non-Trane product really and the actual Trane (59:55) content sounds pretty low. So what I have seen other folks successfully transition to their own content or their joint venture content because they own part of it, et cetera, what's your plan and strategy here? It's one of the only places you don't really own it and not vertically integrated and seems like a big opportunity.

Yeah Steve, look, one of the things here is, we have a very definitive plan of what we're doing. I'm not going to disclose it here for strategic reasons to do that, but I'll tell you that it's a source of investment in Q4. It's a large business in Asia, and it's growing and we make and co-develop our own product there with partners. Here, our growth rates are higher than the rates you're reporting. So we're seeing higher growth rates in our unitary business and higher growth rates than what you're seeing. Our focus really is on the VRF business, not on the mini-split business. We think that's where the value is. That's where controls matter. That's where hybrid systems come into play. It's where our channel works and where service is a possibility. So again, our focus is on VRF. You've seen Trane branded product there in the US. Mini-splits, we're a bit more agnostic to that. We serve the market. We're not as caught up in whether that says Trane or Trane and somebody else or somebody else going through our market. Steven Eric Winoker - Sanford C. Bernstein & Co. LLC: Okay. That's helpful. And also on back to the cash flow discussion for 2017. So at the midpoint, it looks like that 100% conversion, Sue, you talked about 4% working capital target. But Mike, I think it's a decade now almost that we've been talking about lean conversion and much, much better inventory and other management. So maybe a little flavor here on why couldn't you keep it at a lower inventory level to still meet channel demand. Or is it just the shift in inventory from raws and work-in-process to finish goods? What's going on there?

Yeah. I think that whether its 3.6% or 4%, and whether the inventory turns are 6.8 or 6.9 really isn't what we're trying to do. What we're trying to do is get 100% on-time customer shipment at cycle times that competitors can't deal with and pick up all the discretionary business that's out there to get. And we want a balance between the two, and so long as we're growing margins and growing share, we feel like it's a good formula. So the place to put the gas down isn't on creating a problem where you're inadvertently creating a situation where you're not competing in the area that you want to compete. So Steve, you know us as well as anybody that really that cycle time conversion and that compression in cycle time is worth something, not just on working capital, but on growth and operating margins. And so that's always been our focus. And so whether it's 3.6% or 4%, it's not as important to us. It's we know it's already, if not the best, it's certainly top quartile working capital, top quartile inventory turns and our return on invested capital last year was almost 24% for the company.

Cash flow.

Cash flow return on invested capital was 24%. I mean, so let's grow the company and let's grow margins. Steven Eric Winoker - Sanford C. Bernstein & Co. LLC: Yes, no, that's great. I just wanted to make sure that you've had tremendous traction in this area, I just want to see that the pedal is still pushed down, that's all.

It will never let up. I promise you, as long as I'm breathing, it will never let up. Steven Eric Winoker - Sanford C. Bernstein & Co. LLC: Excellent. All right, thanks.

There are no further questions at this time. I'd now like to turn the call back over to Zac Nagle for any closing comments.

I'd like to thank everyone for joining on today's call and thank you for your interest in Ingersoll-Rand. As always, we'll be available in the coming days and weeks to take any questions that you may have. So, feel free to give us a call and we'll also be on the road quite a bit this year, so we look forward to meeting you in person. Thank you, and have a great day.

This concludes today's conference call. You may now disconnect.