Welcome to ITT's 2016 Fourth Quarter and Full Year Results and 2017 Outlook Conference Call. Today is Tuesday, February 14, 2017. And starting the call from ITT today is Melissa Trombetta, Vice President, Investor Relations. She is joined by Denise Ramos, Chief Executive Officer and President; and Tom Scalera, Chief Financial Officer. Today's call is being recorded and will be available for replay beginning 12:00 PM Eastern Time. At this time, all participants have been placed in a listen-only mode, and the floor will be open for your questions following the presentation. It is now my pleasure to turn the floor over to Melissa Trombetta. You may begin.

Thank you, Rachel. I'd like to highlight that this morning's presentation, press release and reconciliations of GAAP and non-GAAP financial measures can be found on our website at itt.com/ir. Please note that our discussion this morning will primarily focus on non-GAAP measures. During the course of this call, we will make forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. No forward-looking statements can be guaranteed, and actual results may differ materially from those projected. We undertake no obligation to publicly update any forward-looking statements, whether as a result of new information, future events or otherwise. Forward-looking statements made on this call should be evaluated together with the risks and uncertainties that affect our business, particularly those disclosed in our SEC filings. So, let's now turn to slide number 3 where Denise will discuss our results.

Good morning, everyone. Thank you for joining us as we discuss our 2016 financial results and 2017 guidance. As I reflect on 2016, I'm proud of the many achievements that dedicated teams all across ITT produced in the face of a historic reset in the global oil and gas markets and weaker than expected industrial market demand. Despite these pressures, we always maintained our intense focus on advancing our long-term growth strategies. We fought hard every day to maintain that critical balance between delivering solid results and advancing our long-term strategic potential. So, let me share those 2016 strategic highlights in three focus areas. Starting with optimizing execution. Industrial process greatly advanced their structural transformation in 2016. In the middle of the oil and gas reset, IP successfully executed a 30% head count reduction and reduced a number of operating locations which helped to partially mitigate the lingering pressures in our key end markets. We have more work to do in 2017 to continue to drive greater global efficiency, but I'm pleased with the tremendous progress we've made. And I'd like to highlight here that although we saw significant impact in our IP results due to the 23% volume decline, we took the right proactive actions to help mitigate the operating income impact. Motion Technologies continued to drive exceptional operational effectiveness that produced an impressive 18% increase in adjusted operating income in 2016, excluding the contribution from Wolverine and foreign exchange. These results were driven by the world-class manufacturing excellence program that Luca Savi and his friction automotive team began almost two years ago to further improve their operations. The financial benefit of these improvements can be seen in MT's adjusted segment operating margin expansion of 90 basis points to 19.1% excluding the impact of Wolverine and foreign exchange. At…

Thanks, Denise. So now, let's turn to slide 6 for our 2017 revenue guidance by market. Starting with our largest and fastest growing market of automotive and rail, we expect low-double-digit growth in total revenue, or approximately mid-single digit growth, excluding foreign exchange and the impact of our strategic Axtone acquisition. These gains are driven by modest global market growth, amplified by our global automotive and rail market share gains. Partially offsetting some of the growth in the broader transportation category is our in aerospace and defense business, which is expected to decline low-single digits in 2017. This net decline is driven by lower non-core aerospace platform volumes, long cycle defense platform dynamics, and increasing pricing pressures, partially mitigated by commercial aerospace and rotorcraft's growth. In general industrial, we expect modest growth versus 2016. We plan to offset the soft market conditions by enhancing front-end strategies to increase our global capture rate in our industrial markets. In addition, the Axtone acquisition provides a modest amount of incremental industrial revenue. Conditions in the chemical and industrial pumps market remain challenged and we are expecting a decrease in the high-single-digits range this year. This decline is driven by an expected continuation of recent short cycle industrial weakness due to cautious customer spending and prolonged replacement cycles coupled with lower mining project activity. These declines will be partially mitigated by low-single-digit increase in chemical pumps due to growth in North American petrochemical project activity, supported by solid backlog entering the year. And lastly, oil and gas, which today represents only 10% of ITT's revenues, is expected to be down in the low-double digits range. We are forecasting our midstream and downstream markets to be down approximately 30% in 2017, due to lower backlog entering the year and the expected continuation of a weak…

Our first question is coming from the line of Mike Halloran, Robert Baird. Mike P. Halloran - Robert W. Baird & Co., Inc.: Hey. Good morning, everyone.

Good morning, Mike. Mike P. Halloran - Robert W. Baird & Co., Inc.: So, can we start with the IP progression as you work through the year here? What does backlog look like on a year-over-year basis exiting 2016? And then what does that imply for the type of improvement you're expecting to see as you work through the year in the short cycle type businesses?

Yeah. Hey, Mike. It's Tom. The backlog ended the year down about 14%, 15% compared to the prior year. We really saw a sequential decline in the backlog in Q4 relative to Q3 and that was about 3% or 4%. So, we had a deceleration in some order activity in Q4 and a lot of that was on the short-cycle side of the business. Interesting to note that the project business orders in Q4 were actually very strong. So, obviously, as we manage through the environment, based on the quarter, based on the week, sometimes based on the day, we're seeing a lot of different activity and volatility, whether you're talking short cycle versus project, and that's just the nature of where we are at this point in the cycle. So, as we sequence into 2017, we have assumed that we're going to have a continuation of the weaker short cycle environment play through because we're basing our 2017 guide on our most current order activity, primarily coming out of Q4. So, as we mentioned, we do expect short cycle revenue to be down on a year-over-year basis in the high-single digits. We would expect a little bit of improvement in the second half of the year compared to what we had in the first half, but not very much. So, I would say a slight increase as we enter the back half of the year. And then, our project business, the timing of that is obviously dependent on the nature of each project. So, that's how we kind of see the year phasing. Not a major change. It's evenly split revenue first half or second half for the most part within Industrial Process. But I'd say we're watching the short cycle indicators and we did have some positive indications in January and early February, but we're not getting ahead of the markets at this point.

Yeah. And I think important to note, as Tom indicated, that in Q4, we saw good short cycle volumes coming through in terms of the top line. And we expect in Q1 that that is – we're not going to see a strong short cycle sales coming through in Q1, but it'll build a little bit as we get into the back half of the year. So, see a little bit in Q1 that may be lower than that. But as Tom indicated, the first six weeks of the year has been pretty decent and has slightly exceeded our expectations. So, that's good. Mike P. Halloran - Robert W. Baird & Co., Inc.: Yeah, that is good. And then staying on IP, the margin side. Back to 3Q, there's lots of puts and takes on the margin line, you hit 4Q here. Margins were healthier than we were expecting, better sequentially. A couple of questions there, just a couple of thoughts. One, how do those puts and takes work through the quarter? What does that mean for this year? And then, secondarily, is the fourth quarter a pretty fair run rate to build off relative to the revenue levels and how do you see that progressing?

Yeah. Let me start and then Tom can add. The revenue levels in Q4 were the highest of the year for IP and it was relatively – it was stronger than what we had expected. So, we don't expect to see that flowing through into 2017 – into the first quarter of 2017. Also, as we indicated in Q4, we had the higher revenues which some of it was projects related, some of it was some short cycle that came out of backlog. So, as we think about margins for Q1, the lower short cycle volumes are going to impact our Q1. Volumes will be lower than what you saw. Margins will be slightly lower or lower than what we saw in Q4. But we expect as we go through the year, as we have more short cycle volumes coming through and as more of the restructuring dollars and the productivity benefits start flowing through that we should see a nice progression in the margins for IP on a sequential basis. Mike P. Halloran - Robert W. Baird & Co., Inc.: Great. Thank you. Appreciate the time.

Thanks, Mike.

Thanks, Mike.

Your next question is from the line of Nathan Jones with Stifel. Nathan Jones - Stifel, Nicolaus & Co., Inc.: Good morning, everyone.

Good morning, Nathan.

Good morning, Nathan. Nathan Jones - Stifel, Nicolaus & Co., Inc.: I'd just like to start going through a couple of the paces of the guidance, because you have the 80 basis points of growth investments, $0.15 of earnings. I assume the majority of that goes into the Mexico brake pad facility. We're supposed to be producing there by the end of the year. Does that wind up the growth investments or it sounds like you got a bunch more orders to fill that facility and maybe you need to add capacity to that building through 2018, 2019?

Nathan, that facility, the way that we construct these facilities is we have the facility and then we only build when we get the orders associated with the build-out, so we don't get ahead of ourselves with that. So, we're building to this first phase and then we will make incremental investments. That will be the equipment and other things that need to happen as we build out the facility as we get new orders over time. It is still projected to start up in the fourth quarter of 2017, so we're really not going to get the volume benefits coming through with that investment until we get into 2018. And you are correct, the investments that we're showing this year, large majority of that has to do with that North American facility. We also have some capacity additions that are being made in our Wuxi facility and in our facility in the Czech Republic because of the strong volumes that we've had and the growth that we've had in MT over the past year or so.

And, Nathan, as we kind of go into the – sure. Just one quick follow-up point. The level of investment this year, if you just keep in mind, is elevated because we're building out the infrastructure, hiring all of the teams, the SG&A really putting the entire set of capabilities in place in 2017. As we go into 2018 levels of investment, we'll come down significantly even if we're adding more growth capital going forward. So, think of 2017 as the real year of getting all the infrastructure in place and all of our capability set up to help us continue to drive production and growth on this facility. Nathan Jones - Stifel, Nicolaus & Co., Inc.: Yeah, that is what I was trying to get at. Given that you have pretty good visibility into how the volume ramps up in that, can you give us any idea of what that 80 basis points of investments that is this year should go down to next year? Like does it cut in half, does it go to zero?

I would say, Nathan, just probably 65%, 70% of this year's investment is tied to the Motion Tech expansion in North America. So, that number should significantly come down in 2018, as I mentioned, because we will build out the infrastructure. So, this year is certainly at elevated levels with the biggest driver being Motion Tech, and that number should come down. So, I don't want to give you an exact call for 2018, but absolutely I would expect it to step down based on what we know today. Now, there's always the hope that we land new opportunities elsewhere in the portfolio, we're driving other growth in aerospace platforms or outside of the Motion Tech segment, but based on what we know today, I would expect these numbers rolling into 2018 for these activities to come down significantly. Nathan Jones - Stifel, Nicolaus & Co., Inc.: Okay, so it sounds like maybe 40 basis points to 50 basis points of tailwind, and, if it's not, that is a high-quality problem to have.

Yeah. Nathan Jones - Stifel, Nicolaus & Co., Inc.: Then on the 100 basis points of non-functional corporate expense increases, are these – can you talk about what they are? It sounds like some of it is increased stock comp and some of it is non-recurring benefits that you had last year. Is this $45 million – and what I'm trying to get here is, is this $45 million corporate expense a decent run rate going forward over the next few years? Or are there some one-time things in here that may go away? Just any hope you can give us with that?

Yeah, absolutely. Nathan, there's kind of a big difference in our minds between favorable results in one year and the non-recurring type performance, if you will. So, we think about each year, we reset at corporate, and I'll go through a couple of the big buckets. We had decent amount of favorability on the environmental line in 2016. And basically, the way it works for us with environmental, we start every year with an understanding of the sites that we're involved in, the activities we need to remediate, and we project the cost based on what we know entering the year. And then, the second we start the year, we work aggressively to reduce those costs to drive more efficiency at the site locations and then to drive insurance recoveries. So in 2016, we had a very strong performance year which gave us $6 million of favorability. As we reach that 2017, based on what we know from the sites we're going at, we would kind of reset that environmental expense and we would right away start up trying to do better than that from an execution performance perspective. But with that kind of number, there's no guarantees as to what could happen with environmental expenses. It's not all within our control. So, that's just to give you a flavor for how some of these non-functional corp items work. Similar story with interest and investments: We had about $5 million of favorability in 2016. Don't want to call the markets in 2017 and expect that level of performance, so we do re-baseline those assumptions going from 2016 to 2017. As you mentioned, we had $5 million of compensation reset and that's just a reflection of obviously what – where we ended up in 2016 and resetting back to budget for 2017. And then lastly, there's about $5 million of favorability generally tied to our workers' compensation performance. And again, this is another one of those situations where every year we come in with an expectation of what the cost will be and we work hard to try to reduce those costs through good solid management of cases and good safety protocols within our operational environments, and we had a good year of execution in 2016, but we just can't expect that to repeat again in 2017. And just like environmental, some of those costs can go up from year-to-year. So, that's just to give you a little flavor of the four or five major buckets that we manage in corporate year-to-year. But I would say the 45 is absolutely the right starting point run rate, and we're going to go just like we did in 2016 and try to see if we can execute as best we can to bring that down over the course of the year. Nathan Jones - Stifel, Nicolaus & Co., Inc.: Okay, good baseline to start with and you'll try and get it in lower.

Exactly. Recognizing we don't control all the variables, but what we can control, like in the operations, we'll try to do our best to bring it down. Nathan Jones - Stifel, Nicolaus & Co., Inc.: All right, I'm just going to slip in the obligatory Trump question. You've got a couple of facilities in Mexico. I assume that brake pads are all imported into the U.S. and a lot of the ICS business is imported into the U.S. How are you thinking about the impact on those businesses and what you might need to do if there is some border tax put on there?

You know, Nathan, we do have a very global footprint and what we try to do is locate our facilities next to where our customers are, and where it's most important to them. In fact, when we were looking at the automotive facility, we did that in close collaboration with our customers as to where would be the best location to be able to do that. As you know, it is a brand new facility. We've not had one in North America in the past, so it's an extension of the facilities that we had in Wuxi and in Italy. We don't invest ahead of the contracts that we've received, so we've got the full – the facility is full for this next phase here in terms of the contracts that we've got. And we believe that this is the right position for us. And again, it was done in close collaboration with our customers. So, we feel good about it. And again, it's been fully awarded and we're happy with it. In terms of the ICS facility, there's – again, we have a global footprint. We do have some facilities in the U.S. also. Many of our customers, many of our competitors are also located in the same geographical region. And so, we'll just monitor and evaluate it as we go through time. As everybody knows, it's uncertain now as to what this tax is going to look like and what will happen with it. And so, we'll just monitor it and make decisions accordingly. But we're currently very happy with what we have. Nathan Jones - Stifel, Nicolaus & Co., Inc.: Okay. Thanks for the help.

Your next question is from the line of John Inch, Deutsche Bank.

Thank you. Good morning, everyone. Hey.

Good morning, John.

Good morning, guys. What's the magnitude of these pricing declines? Could you flesh that out a little bit? Are they abating in any context and maybe – I'm assuming a lot of this is IP. Is there any commentary you can provide on, say, the project versus more the baseline stuff?

John, in terms of pricing, in fact, most of that pricing is on the automotive side, which we experience every year because we've got to give back a certain amount in terms of the contracts that we have in place from an automotive perspective. In terms of pricing with IP, we did see some declines last year in most of the project businesses that we had that's already been reflected in our 2016 results. We don't see it getting better in 2017 with the projects. So, we're seeing it sort of maintained at these lower levels. On the short cycle side and in IP, a little bit of some pricing pressures there. Not too significant at this point as we get more and more competitors going after the short cycle business. We may see a little bit more associated with that. But in terms of most of the pricing that we have embedded in 2017, it's on the automotive side of things.

Right. And I should have actually qualified that ex-automotive, because that's obvious. On the way down when the oil and gas cycle went bust, I mean I think projects were under tremendous price pressure. Would you say that things have kind of stabilized on a relative basis, Denise, in terms of the context of what sort of pricing? The $64,000 question is, is pricing going to get worse as these projects pick up? Or because it's been so aggressive on the way down, are they sort of more stable? What do you think?

We don't see it getting worse at this point, John. It just is remaining at these low levels that we've experienced in 2016, but we're not seeing additional incremental pressure coming on top of that at this point.

Okay. And then, I want to ask about restructuring. I think you said a year ago you were going to do $20 million to $30 million of restructuring. I think you've done about $27 million; I couldn't quite find the number, but I think it's about $27 million. You're going to do another $30 million. I realize you said half of it is for these acquisitions, but what is actually this for? Maybe can you talk a bit more about like – I mean we've been doing restructuring for so long, haven't we downsized enough or is this a re-footprinting or what's actually going on?

Yeah. John, when you think about the $30 million, as you mentioned, half was for acquisitions and the synergies that we plan when we go after the acquisitions. The other half is spread out across the other businesses, smaller levels of activity, right? We did take a big amount of restructuring up to $30 million in 2016, a lot of that concentrated in IP. I would say kind of where we are is just follow-on and continued kind of refinement from what we started in 2016, but we're going to continue to kind of monitor the environment and a lot of those activities will be weighted into the second half of the year, but we don't have necessarily big specific activities. It's more the remaining half is, I would say, spread out across the other businesses but not in a major concentration.

But is this a head count focus, Tom? I mean when you think restructuring you think head count or is this a re-footprinting in some manner?

I would say there's a little bit more re-footprinting, but still the weight would be towards driving efficiencies on the SG&A side, but I think that where we are with some of these restructurings. There could be some more focused on leveraging or centers of operational excellence and re-footprinting particularly where we produce, where we have strength. So, I would say that there could be a little bit more footprinting than what we saw in 2016, to use the term, but not any kind of major specific location that I would point you to.

Your head count reduction of 30% is pretty impressive in the context of how you had to respond so quickly. Dover cut its number by 30% and I realize it's not the same – it's not the same mix because they are more of the surface driller, but what they are finding is they actually having to now add that cost and hire people, which is sort of capping their variable contribution on the way back. And again I realize you're a pump company, it's very different. Do you feel like you've got the flexibility when the market cycles back at whatever point to whatever degree, that you're not going to have to go back and hire people that you sort of spent the last two years taking out effectively?

Yeah. That's the intent, John, is to not go back and rehire these people. In fact, we've been reworking processes and procedures to make sure that that doesn't happen. And then, remember, we've put in a new COO here with Luca and he's going to be driving some more efficiencies and productivity in the businesses, just looking at how we operate and how we do things. As a result of those changes, we won't need to come in and hire people back again. That's the intent.

Perfect. Thanks very much.

Thanks, John.

Thanks, John.

Your next question is from the line of Jeff Hammond, KeyBanc Capital Markets.

Hey. Good morning.

Hi, Jeff.

So really just want to go back to the short cycle comments, because it seems like it was better than expected in 4Q and certainly drove upside in my model. And the first six weeks it seems better, but yet you guys are still kind of projecting it will be down. So just maybe a little more color on why the caution and why – what you're really seeing short-term?

Sure. Yeah. Jeff, what happened is we had short cycle sales that picked up, but what we were really looking at is the order flows in Q4. So, it depends on which question we were addressing. But specifically, the orders for the short cycle were down versus expectations and down sequentially by 9% compared to Q3. So, while the sales were up, the orders didn't fill back in and we entered the year with less short cycle backlog than we had in 2016 entering the year. So, that's why we were cautious in our guide. As we mentioned, we're watching January weekly trends and they've been a little bit more positive than what we saw in Q4, but that's how we looked at the year. I mean, the one thing, as we exited Q4 2016, we did deliver a lot of our delinquent project backlog that really kind of drove some of our increase in total revenue in the Industrial Process segment. So, a good solid execution on large projects that gave us a really strong total revenue number in Q4. So, that's kind of the nature of IP at this point.

You know as we talked about before, our short-cycle business has been very inconsistent. It's not a pattern that's out there. It's very volatile. And that's why when we guided, we decided that we're just going to use current conditions, because we've had ups and we've had downs and it was just hard to predict going forward what it would look like. So, we're happy with what we've seen in the first six weeks, but not enough to call a trend yet.

Okay, good. And then you mentioned midstream and downstream being weak, is that a project comment? And then, just as you think about quoting and some of the commentary we've heard on mid and down, it has gotten a little bit better around deregulation and just confidence. And maybe just speak to how you look at the projects filling in prospectively?

We haven't seen any significant trend change in terms of midstream and downstream projects. Now it's important to note that we don't play much in the midstream. We do in the downstream. We think that that could be an area of opportunity for us if activity begins to pick up in the downstream. We think we might see that sooner there than we might in the upstream side of the business. But we just haven't seen enough of that yet to say that there's been any pick up from a trend perspective in that market.

Okay. Thank you.

Thanks, Jeff.

Thanks.

Your next question is from the line of Shannon O'Callaghan with UBS.

Good morning, everyone.

Hi, Shannon.

Good morning, Shannon.

Hey, Denise, can you talk a little bit more about Luca's role here and how you see what for Motion can translate to these other businesses in particular? And then this $0.31 of net productivity, it's a pretty big number on flat volumes. So how were you able to get after that so quick, what are the drivers? I think you mentioned lean and sourcing, but maybe a little bit more color on sort of what is already happening in 2017.

Okay. Let me talk about Luca, and I'll have Tom deal with the productivity number. I think everybody has seen the results that Luca has demonstrated in terms of the Motion Tech performance. He has a very strong operational background. He's not only been in the automotive industry, but he's also been in a number of other different industries. And what he has done in Motion Tech and in other jobs that he's been in will translate very well to many of the businesses that we have in our portfolio today. He really has a very unique skill and is able to identify efficiencies and optimizations across a footprint in how we operate and how we do things. And over the course of his career, he's gone into many, many different areas and he has found ways to create value. So, we're going to take the expertise that he has and apply it to these other businesses. And we think that this is a very good logical step in our evolution and is going to produce some nice benefits as we go forward.

Yeah. And, Shannon, on the $0.31 of net productivity, pretty consistent on the growth side with our prior focus on productivity. It's evenly split between lean, sourcing and restructuring. So, it's about a third, a third, a third across those three major buckets. And consistent with the way that we've operated in the past, consistent levels of gross productivity. I would say, actually, what's unique and has been unique as Q4 has progressed into this year is the higher commodity cost impacts that we're seeing offset some of that productivity and bring the net number down. So, we've experienced about a $15 million to $20 million year-over-year increase in commodity costs, and a lot of that is based on the recent surge in steel, tin and copper. So, that has actually been unique this year compared to the prior year where we've had higher cost erode some of the net productivity actions.

Okay, thanks. And then just on free cash conversion, I mean you have some of the elevated CapEx in 2017. Where does that head from here, working capital, things like that? How should we think about cash conversion for 2017 and then what are the dynamics beyond that?

Yeah. Shannon, I think our focus in 2017 is to drive improved working capital performance, so you're going to see with Luca's new role as Chief Operating Officer, an intensified focus on working capital improvements. We would expect to see around 100 basis points of improvement on a year-over-year basis in working capital management. That's through efficient inventory and accounts receivable in particular where we think we have some opportunities. We did generate pretty solid free cash flow conversion in 2016, around 96%. As you mentioned, we'll have that number stepped down because of the elevated levels of CapEx for our Motion Technologies. So, I would expect something kind of closer to the mid-80% conversion range because of the increased investment in 2017.

Okay. Great. Thank you.

Your next question is from the line of Matt Summerville, Alembic Global Advisors.

Hi, guys, this is actually Nick Chen for Matt this morning. Thanks for taking our question. You've gotten to most of them. I was hoping you could just give a little bit more detail surrounding OEM growth rates in auto brake pads, specifically by region. You'd sort of given just higher upper marks surrounding that in your introduction.

Sure. So, in terms of OEM volumes for 2017, we're going to see some nice growth in China with our OEMs. We've won a lot of new platforms in 2016. And so, we're going to see the benefit of those flowing through in China next year. And we've been having double-digit increases in our OEM volumes, and we expect that to continue next year in China. Europe, we're going to stay with the market or we'll exceed the market actually in our OEM volumes. And then, in North America, that's actually more of a 2018 story for us than a 2017 story. So, from an OEM perspective, most of the growth is going to be in China in 2017, but we will see some nice aftermarket growth as many of the new platforms that we have in place in Europe and a little bit in North America as they start coming through the dealer service cycle and then more in the independent aftermarket.

That's great. Thanks so much. I'll jump back into the queue.

Thanks, Nick.

Thanks, Nick.

Your next question is from the line of Joe Giordano with Cowen. Joseph Giordano - Cowen & Co. LLC: Hey, guys.

Hi, Joe.

Hi, Joe. Joseph Giordano - Cowen & Co. LLC: How is the search going for a new President in IP?

Well, we're very picky. We're aggressively involved in looking for a candidate. We've talked with a number of different folks. As I said before, we have high standards for this position. But, in the meantime, Luca has really jumped in and he is really leading that team right now and really digging into the business and understanding it and looking for ways to drive productivity and really make sure that we hit our operational metrics there. So, the search is continuing. It's very aggressive. But in the meantime, we've got Luca overseeing it, and I'm happy with what's happening there. So, we'll keep you informed and we'll let you know when we have a decision made on that. Joseph Giordano - Cowen & Co. LLC: Okay. And just for reference, how big was the project business in IP last – in 2016?

2016 project business was around...

25%.

...30%.

Yeah. 25%. Joseph Giordano - Cowen & Co. LLC: 30%?

I think that's 30%. Joseph Giordano - Cowen & Co. LLC: And the expectation of that going into 2017 is what again.

We're actually going to see it come down, Joe, on a year-over-year basis. It's kind of...

Low to mid-20s%.

Yeah.

Probably, low to mid-20s% is what we'll see for next year – for this year, 2017.

As a percent of total?

Yeah. Joseph Giordano - Cowen & Co. LLC: Okay. And then when I look at ICS, the margin there, you're seeing a bit of improvement there. How representative is that exit rate of like a full year kind of target for next year?

Yeah. Good question. You need to be careful on that exit rate because we had a reasonable amount of volume flowing through in Q4 for ICS. So, I think the best thing to look at is the full year rate that we had for them, and then extrapolate from there as we get into 2017. So, start from that point, and then build off of that for Q1. And then, the intent is to build the margin progression as we get – as we go through the year. Joseph Giordano - Cowen & Co. LLC: Well, Q1 was like 3%. I imagine you were going to – you should be well above that, right, for 1Q 2017?

Right, right. What I'm saying is take the full year for 2016... Joseph Giordano - Cowen & Co. LLC: Okay.

...which is lower 6%. Joseph Giordano - Cowen & Co. LLC: Yeah, yeah.

And use that as sort of the starting point for the year. Joseph Giordano - Cowen & Co. LLC: Yes. I got you, okay. I thought the best part of ICS was kind of – the order growth there seemed to step up a decent amount on a sequential basis. Are you starting to see – was that more driven from resumption of normal operations or was that upstream oil and gas kind of coming in a little bit? How would you categorize – like what do you think drove that pick up a little bit?

Yeah. Joe, it was good, sequential order growth from Q3. And it was kind of across the board, so we did see it in upstream oil and gas orders, general industrial which a lot of that business comes out of Europe for us, where we're seeing a good uptick in heavy duty, heavy vehicle activity. And even aerospace and defense had a pretty solid uptick. Some of that was just timing of orders I would say. But a positive order result in Q4 – don't want to get ahead of the markets as we mentioned. But our hope and what we worked on all year in 2016 is to continue to regain market share and the confidence of our customers so that we can drive order growth into 2017. But I would say Q4 orders were encouraging, but not necessarily clear enough of an indicator, in our opinion, to draw that as the term line going forward. Joseph Giordano - Cowen & Co. LLC: All right, and then last question I had on mining. We've been hearing a little bit more positive kind of off-the-cuff comments on the space from some people, obviously off very easy comps and much lower comps. But are you seeing anything there going on, anything brewing or are orders there picking up a little bit?

No. Not really, Joe. The projects are still down for mining. Obviously, that's where we have the best visibility and we don't see an uptick at this level on the mining side. If it happens, we'll be ready to – probably would be orders maybe more of a 2018 story for us. But right now, we're expecting mining to be down on the revenue side in 2017. Joseph Giordano - Cowen & Co. LLC: Okay. Great. Thanks, guys.

Your next question is from the line of Joe Ritchie with Goldman Sachs. Joe Ritchie - Goldman Sachs & Co.: Thanks. Good morning, everyone.

Morning, Joe.

Good morning, Joe. Joe Ritchie - Goldman Sachs & Co.: So, going back to that question earlier on Trump, I just want to understand on a pro forma basis, what is your net import position after the capacity investments and to the extent you've had to ship any manufacturing overseas as well?

Remember, we have about 60% international revenues, and we tend to look at where our customers are. We've done a high level look at this, and based on third-party sales, we're a net exporter and we expect that we would still be a net exporter even after the Motion Tech facility is in place and operating. Now, the interesting thing to note with that Motion Tech facility is that 60% of the volume out of that facility will go into locations other than the U.S. So, net exporter, expect to continue to be that. We still evaluate it. There's going to be a lot of rules as to how you define it and we'll evaluate it as we go on, but that's our high level analysis right now. Joe Ritchie - Goldman Sachs & Co.: Got it, that is great, Denise. The follow-up question I had was really on the restructuring savings. Clearly, you're ramping them up again in 2017. What is the carryover benefit for 2018?

Great question, Joe. We haven't kind of fully detailed out every one of the actions, but I would maybe go the other way. We're only expecting about 25% of the savings in 2017 to be from 2017 actions. So, you can kind of infer from that that more than half of the expense is going to be incremental rollover into 2018. So, it should give us a nice set-up and that's the idea. We want to make sure that we detail out these plans. We know exactly which actions we want to take, and the intent is to really have that drive a significant benefit into 2018. In addition, the investments we're making in Motion Technologies and other things, a lot of what we're setting up for 2017 is really good solid growth and execution in 2018 as well. Joe Ritchie - Goldman Sachs & Co.: Got it, that makes sense. And maybe one more for you, Tom. On the buyback that's in the guide – are you embedding the entire $65 million buyback in your guidance for 2017?

Another good question, Joe. It's – we don't – it's hard for us to exactly predict the timing of activities. The idea is we want to return capital or deploy capital. So, effectively, we are assuming that we're going to be able to obviously deliver in our EPS commitments that would include repurchases at the $65 million level and/or M&A activities that we would hope to see be accretive. At this point, we don't see any activities in the pipeline coming to fruition. In the short term, we are integrating Axtone and our Wolverine acquisitions from last year. So, effectively, yes, Joe, but not a specific amount in a specific quarter because we want to watch our other deployment alternatives, and we always prioritize acquisitions first. But at this point, as I mentioned, the pipeline probably looks like it might be a little bit more second half weighted with opportunities. Joe Ritchie - Goldman Sachs & Co.: Got it. Thanks, guys.

We have reached the allotted time for questions. I would like to hand the call back to Denise Ramos for any additional or closing remarks.

So, let me just conclude by saying it's not business as usual here. Many of the actions that we are taking today, they will give us benefits in the future. We talked about how we're changing how we operate with a new COO. We've combined the leadership of ICS and CT, which is going to give us cost savings out into the future. We're making investments this year for the future, primarily in our North American facility where we're going to see volumes flowing through in 2018. We're going to be doing additional restructuring where we're going to get benefits outside of this year. And then, the acquisitions that we have and the integration associated with that, they will give us benefits as we again go out into the future. For 2017, we're not getting ahead of the market, and that's embedded within the guidance that we gave you. And, this year, it's all about execution and the targeted investments that we're making. So, thank you for joining us on the call, and we look forward to talking to you after next quarter.

Thank you. This does conclude today's teleconference. Please disconnect your lines at this time, and have a wonderful day.