Welcome and thank you for standing by. At this time, all participants are in a listen-only mode. After the presentation, we will conduct a question-and-answer session. [Operator Instructions] Today’s call is being recorded. If you have any objections, you may disconnect at this point. Now, I will turn the meeting over to your host, Mr. Glen Ponczak. Sir, you may begin.

Thanks, Ashley and welcome everybody to the call to review Johnson Controls’ third quarter fiscal 2015 earnings. If you have not received the slide presentation, you can access it at johnsoncontrols.com. Click on the Investor link at the top of the page and then scroll down to the Events calendar section. This morning Chairman and CEO, Alex Molinaroli will provide some perspective on the quarter and review some of the details on this morning’s announcement regarding the planned spin-off of our Automotive Experience business. He will be followed by Executive Vice President and Vice Chairman, Bruce McDonald, who will review of the business unit results and then Executive Vice President and Chief Financial Officer, Brian Stief will review the company’s overall financial performance. Following those prepared remarks, we’ll open the call for questions and we are scheduled to end at the top of the hour. Before we begin, I’d like to refer you to our full forward-looking statements disclosure and the news release. You can also find it in the slide deck and remind you that today’s comments will include forward-looking statements that are subject to risks, uncertainties and assumptions that could cause actual results to be materially different from those expressed or implied by such forward-looking statements. Those factors include potential impacts of the planned separation of the Automotive Experience business and business operations, assets or results. Required regulatory approvals that are material conditions for proposed transactions to close, the strength of U.S. or other economies, automotive vehicle production levels, mix and schedules, energy and commodity prices, availability of raw materials and component products, currency exchange rates and cancellation or changes to commercial contracts, as well as other factors discussed in Item 1A of Part I of Johnson Controls’ most recent Annual Report on Form 10-K for the year ended September 30, 2014. Johnson Controls disclaims any obligation to update forward-looking statements to reflect events or circumstances occurring after the date of this presentation. And with that, I will turn it over to Alex.

Alright. Good morning, everyone. I want to start by recognizing the fact that our employees, once again I feel like a broken record and it’s fantastic to be able to say that our employees continue to deliver in an environment that externally has some mix markets and we will talk about that a bit, but probably more importantly for us through the significant amount of change that we are going through, our employees continue to deliver in each one of our businesses and I am particularly proud that our margins continue to improve lot of that from an perspective as we follow and implement our Johnson Controls operating system. So, if we are on the first slide there that I have, we will start to talk about the markets. In a minute, I am going to talk about China. But for the most part, the markets are participating in a way and improving in a way except for China that we have been able to take advantage of and it’s good for us both in buildings market and in our automotive market and in our battery market. And I have a slide here in a second we will talk about China specifically, but if you take a look at where we are and what I am particularly proud of, our revenue and backlog, we will talk a minute about building efficiency. We are starting to see particularly the strength in our institutional markets. Over the last year, I think it was either a year ago or 9 months ago, we talked about the fact that we saw our pipelines improving and consistently we are seeing growth in our markets and now we are starting to capture those opportunities. And I am happy to say the second quarter in a row…

Alright. Thank you, Alex and thanks for the kind words. So let me start with Slide #8 on building efficiency. You can see, if you look at the numbers here we had a nice quarter. Sales were up 5%, $2.7 billion. I think it’s important to really look at the FX adjusted number. Here we can see that without foreign exchange, our revenues were up 10%, so double-digit increase in underlying revenues. To look at that kind of by region, North America – our North American business up about 4% and we are finally starting to see higher demand in the institutional markets. So for the last probably six quarters to eight quarters, we have been talking about how the HVAC market we have seen the smaller end of the market, the residential side picking up. And I think what’s exciting here and Alex alluded to the fact that we are adding resources, program management and sales force is that we are finally starting to see the long awaited recovery of the institutional market, I think that’s pretty noteworthy. Elsewhere around the world, Middle East is up 18%, still pretty soft in Europe, about down 1% and Latin America not surprisingly continues to be a problem for us, it was down 10%. Orders for the quarter were up 9% if you take out foreign exchange and ADT, underlying orders were up 6% with really strong growth in local and state and federal government. Those were the vertical markets that really drove the growth in our orders in the quarter. Outside of North America, if we look at Asia, up 13%, the Middle East was up 11%, Europe down 1% and Latin America down 11%. Backlog is up about 5% at $4.7 billion if you adjust for foreign exchange. Regionally if…

Okay, thanks, Bruce and good morning, everyone. As you saw in our press release, our results from continuing operation included $26 million worth of transaction integration cost associated with the number of portfolio activities that we have going on and then also included a non-recurring tax charge of roughly $75 million related to some tax plan done in connection with the Interiors JV which closed on July 2. These items resulted in net charges in aggregate of $0.15 in the quarter. As I talk through the financials, I will exclude the impact of these items in my comments. And in addition, you recall that our results from continuing operations will exclude GWS as we continue to report that as a discontinued operation. Overall, third quarter revenues were down 2% at $9.6 billion with higher revenues from Building Efficiency related primarily to the ADT acquisition offset by lower revenues in Power Solutions and auto. But as Bruce and Alex mentioned, each of our three businesses were impacted negatively by FX in the quarter, primarily the euro. If you exclude FX, our revenues in the quarter were up 5% and that’s across all businesses showing year-over-year solid increases ranging from 3% to 10%. If you look at gross profit for the quarter, it was 17.8%, which was up 170 basis points from the prior year. And that’s really due to improved product mix and the ongoing benefits we are seeing from the implementation of the Johnson Controls Operating System. SG&A is up 2% year-over-year that relates primarily to building efficiency where we have got the ADT, SG&A in this quarter and it wouldn’t have been in the prior year quarter. And as well we have added the sales personnel in North America that both Alex and Bruce referred to, to capture market…

Actually, we are ready to take some questions. I would ask everyone to limit their questions to your best and follow-up. And if you got other things to ask, please get back in the queue, so we give more people an opportunity to participate. Ashley?

Thank you. [Operator Instructions] Our first question comes from the line of Mr. Emmanuel Rosner. Sir, your line is open.

Hi, good morning everybody.

Hi, Emmanuel.

So many things to talk about. Let’s maybe start with the spin-off decision. I was a little bit surprised to see such a rapid decision just over a month after you sort of announced that you were exploring strategic options. Can you maybe talk to us about the decision process maybe the rationale to spin-off the business as opposed to maybe selling it? And you see it back from your automaker customer so far.

Yes, that’s a great question. So, actually it was not too tough a decision. If you think about the size of that business and the natural buyers of that business, we have the opportunity to spin the last bit speaking to those potential buyers and understanding what the real opportunity is. And it came very clear to us that we needed to make sure that we focused on the spin. And just like I said in my comments, it’s possible you could still sell, but we need to provide the same amount of work in order to make the spin decision. And I think our customers also needed to have some certainty about what it is that we were going to do, particularly our Chinese customers, because as you know we have many partnerships in China and uncertainty is just not a good thing. So, I think for us and our employees and for our customers and our partners in China, it made sense for us to make this decision. And quite frankly because of the resources that we have on our GWS transaction, our JV with Yanfeng, we have the resources right now to transfer on to this project right now and so it just made sense.

Okay, that’s clear. And just switching gear quickly, I wanted to ask you about building efficiency services, in particular, I was a little bit surprised to see your service revenues which are now ex-GWS down quite significantly year-over-year. I think you have been running at $900 plus million a quarter for the past. So far this year as well as last year the same quarter and now this fell sort of like to the $700 million type of range. And so I was curious what maybe happening in services ex-GWS and also why your margins overall down year-over-year, a little bit despite revenue growth?

Yes. So, I will need to look at the numbers on service. Without having – without getting to some of the specifics, it could be some of our services. We went through a process with GWS as we went through the disposition to decide what part of our service business belong with GWS and what part of it with building efficiency as there is nothing underlying this exchange. So, we will follow up on that, but my guess is it has something to do with how we parsed out what meant the GWS and what stayed with the buildings business. But I will validate that. Nothing – just rest assured, nothing has really radically happened differently around our service business. And in fact what I would tell you is our service business particularly is driven by North America. The margins are up. Our renewal rates are up. And so I don’t think we have any deterioration of that business. I think as it relates to the overall margins of the business and I think you are talking about a year-on-year basis, Brian went through some of the specifics, but one of the things and I did signal this last quarter is that we were going to be staffing up in advance of the growth of the market. And then quite frankly, I will be honest with you not that I would like to see the margins under pressure, but we are having a hard time hiring at the pace that we need to hire in order to capitalize on the opportunities for next year. So, I do expect that we will be hiring in anticipation of the market, because you remember, our business which might be different than some of our competitors, most of our sales go through brands or company-owned operations, so that SG&A cost hits us immediately.

Great, thank you very much.

Okay. Our next question comes from the line of Colin Langan. Your line is open.

Hi, Colin.

Great, thanks for taking my questions. I was hoping to get some color on the joint ventures in Auto Experience in China. Can you give us any color on the size of the EBIT margin for those joint ventures, if there is any cash stuck in those joint ventures, do you know what their balance sheet look like? And all we really have is the net income.

So, this goes really good. I am going to turn this over to Bruce.

Yes. As we have gone through this process, I think one of the things that sort of become apparent from a valuation perspective is we are not doing a good job giving the analyst community a lot of color around our Chinese joint ventures. And from a valuation perspective, we are probably not getting the full valuation there, but I can tell you that I would think for – I am not so sure we can pull together from the next quarter, but definitely by the time we put together our analyst presentation here in the December timeframe, we will provide a lot more clarity there. They are accretive to overall automotive and otherwise the business, the joint ventures of higher margins, not in our base business. But generally speaking, if joint ventures have any debt, it’s nominal, but net-net there is a significant cash balance in the JV. It’s probably in the $700 million to $1 billion range.

Okay, that’s very helpful. And any color on the cost savings program that was announced with any opportunity there to get margins to your targets a little bit faster?

Color on the cost reduction activity initiative?

So, I think as it relates to the Johnson Controls Operating System, I think in the last call we mentioned that we were going to get about $50 million of run-rate benefit in fiscal ‘15 and there would also be another $125 million in run-rate benefit in 2016. And in addition to that, we announced in the press release and maybe this is also what you are referring to that we were going to be looking at really a cost savings review here in the fourth quarter. And those activities are really being done in conjunction with looking at the separation of auto and standing up both those companies as separate public companies and to see whether there is some operating model changes or cost savings that can come out of that process. So, that’s something that we will look at beginning immediately and will probably take place and take action on throughout the next 12 months or so.

Yes, we are bringing more information to you about that. This is Alex. I am sure you are referring to what was in the press release. As we go through separation process, it’s going to be clear that we need to take the opportunity in advantage of not only setting up a new automotive company with the proper operating systems and cost structure, but we need to do the same thing for remaining Johnson Controls. And so that’s what you are referring to. We don’t have anymore information on that, but you can expect to hear more.

Okay, alright. Thank you very much.

Welcome.

Your next question comes from the line of Mr. Robert Barry. Sir, your line is open.

Hey, guys. Good morning.

Good morning.

Good morning.

Hey, Bruce congrats on the new role. Quick actually housekeeping item, could you give us or maybe I missed the North America orders in BE?

Yes, I think that – North American orders in BE up 8%.

8%.

Got it. Thank you. And then also I had a quick follow-up on the spin, I know it’s still early, but just your thoughts on the anticipated balance sheet at auto and whether the plan is contemplating any kind of dividend back to JCI?

There will be a dividend back to JCI. We are still working through what the proper leverage is, but you can expect that we will make sure that the automotive business is in a position to compete. So, it would be similar to its peers.

Got it. And then just given how much advancement you have made in some of the portfolio initiatives, I guess I would expect M&A to start to become a larger part of the story you have alluded to that in some of the comments. Maybe just provide an update on what the M&A pipeline looks like and in particular the size of some of the deals in there and what the timing is on when we might see something of size in BE or Power?

Yes, so that’s a great question. And I don’t think that we can answer it to fulfill you. But I can tell you that as busy as we are on the things that we are talking about as we are just as busy and the things that we are not able to talk about, but we are looking at deals that will complement us from a product standpoint will help us geographically and shore up some of the technical product challenges that we have. So, we have plenty in the pipeline. And I would say, they span the gamut from being bolt on to being things that are transformational.

Got it. And then maybe just one last housekeeping item, what’s the net impact that you expect from the interiors kind of income going out of the P&L versus picking up the 30% ownership in the JV? Is that relatively neutral or is…

It’s neutral.

The equity, 30% of the JV is pretty close to 100% of the remaining parts.

Yes, I think the difference is going to be as we move forward and we pick up the joint ventures income on an equity basis, you end up where you pick that up on an after-tax basis. So, there is going to be essentially a flip between segment income and our tax rate as it relates to how we look at the Interiors joint venture income.

Okay, thank you.

Okay. Our next question comes from the line of Mr. Josh Pokrzywinski. Sir, your line is open.

Hi, good morning guys.

Hi, guys.

So, just on some of the comments you made on moving the staff up in BE and I guess that’s pressuring the margins in the short-term. But how long should we think of the staffing drag weighing on the margin expansion? And then given that you are seeing budding strength, particularly in North American institutional where you have always had a big presence. How should we think about the leverage on the North American institutional web recovery, maybe X some of these staffing up periods, but more ongoing as we get into late ‘15 or I guess late calendar ’15, ‘16 and beyond?

Yes. So, I think that as I said we have some variable cost, because of the sales staffing and it’s going to be in advance. I think without being able to put numbers on that, I don’t have a calculator in front of me, but what I would say is over the next [Technical Difficulty] is going to be a little bit of a catch-up, so make sure they catch up to the marketplace. And then we should see, because remember we are selling and then our backlog is about a 6 month – it’s about a 6-month backlog before we usually start to see the income from that. So that’s when you will start to see the leverage and we won’t be seeing the sales – the sales headcount as just a cost, we will be seeing that as. We will start seeing the earnings from that. I don’t know that I have that exact leverage in front of you but you can expect some margin expansion. Today we are seeing the margin expansion based on the back of our cost profile. We should start seeing some margin expansion based off of our top line.

Yes maybe add a bit to that. I mean we have already sort of talked about those who have been around for a while that our margin improvement trajectory in building efficiency being sort of 50 or 60 basis points a year and over the last couple of years, we have seen growth a lot stronger than that which we attributed to the fact that in a normal business environment, we have to add project managers, people that can do the work on an installation business. And so in weak times, we saw margins growing a lot quicker than that that, that 50 basis points to 60 basis points was a result of some of the improvement activities that we are doing. And here for the next couple of quarters, you are going to see a little bit of lower than that because of the sort of headwind that we have which is absolutely necessary to grow the installation business. So we can’t grow the installation business without putting the resource and training them in advance.

Those two more quarters of that or how should we think about how long this?

So the way that I would think about it is, look at hopefully continuing adding sales resources, but it’s going to take us a couple of quarters to take advantage of the backlog we just put in place. And two quarters the backlog that you just see, the 5% up backlog, is when we will start to see that flow through. And that’s when we will see that at least the effect of the initial hiring behind us and we should see it more of an ongoing hiring as revenues continue to grow. So I think we have got a couple of quarters before we see the real benefit of the sales people that were put in place today. We should see in the backlog but we won’t see in the income statement.

I don’t think what we will see it in the next few quarters. We are going to see margin contraction. That’s not the takeaway here. The takeaway is we are doing a lot of things to grow our margins in all the three of our businesses that we expect to continue. This is a little bit of the headwind against that.

Yes, two quarters out from now then we should be able to attribute our margin improvement not just from our operating efficiencies but also because of the fact we will have some volumes, right.

Alright, that’s helpful. Thanks guys.

Our next question comes from the line of Mr. Johnny Wright. Sir your line is open.

Hi guys. Thanks for taking the question. Alex just looking at the slide you gave on China is very helpful and sort of putting out the color longer term actually maybe just talk a little bit about what you are seeing right now in China, next couple of quarters and how you are going to see the auto demand playing out over the second half of the calendar year?

I think what we see talking to our customers, remember we are talking about passenger vehicles, is that we see the market is going to be growing out about a 6% clip. And we continue to see that and remember for us because we have got some of the right customer some of the right program and we are gaining share in metals, we should be able to continue to outpace that.

So I was in China last week and so maybe I will just add a bit more stories from Ground Zero there. If you look at the passenger curve looks for 2016, so for our next fiscal year, I just anticipate that being in about the 6% range. If you look at our business mix and by that, I mean we tend to be very strong in the premium brands. We don’t have stronger share in the Chinese loan brands or with the Japanese that are doing well in the market. Our production volume based on that 6% for 2016 we anticipate being up 8% to 9%. And then like Alex said, on top of that, we still have some incremental programs, market share wins and the penetration of our metals business. So we still – we feel like with the industry work is now we are well positioned to continue to drive double-digit growth for 2016.

Okay, great. Thanks. And then just on free cash flow, I know we are taking $1.5 billion for ‘15, but given the CapEx now $100 million to $150 million low than you originally expected, what are kind of the puts and takes in the operating cash flow lines versus your original expectations for the…?

So, I think the $1.5 billion is still our target for the year in order to get to that target we are going to have to generate free cash flow in the fourth quarter of roughly about $1.4 billion. We have got plans to do that I would say there are some opportunities that we still have in the trade working capital area and also be benefited by the dividend that I mentioned earlier that did not come in Q3 but will come in Q4. So we are going to be pretty close to that $1.5 billion number I wouldn’t expect any significant movement either up or down from that number.

Okay, thanks.

Our next question comes from the line of Mr. Brian Johnson. Sir your line is open.

Yes, good morning. Want to talk a bit about BE in China. You posted some fairly healthy order numbers A couple of things, when would those come through? Is there anything difference around the conversion and backlog in revenue? Just second, given the slowdown in the China economy, where is that coming from? Are there segments of the Chinese institutional market that you are better exposed, are you gaining share in the segments that you are in and just how you are able to get that order pace?

I don’t know that I would call it episodic, but the fact that we are able to see it across our equipment business and our controls business and our service business I think it has a lot to do with some of the operating models and the changes that we are making as it relates to how we are going to market in some of the cities that are Tier 2 while we have been focused in Tier 1 cities. I don’t know that our backlog is much different in the rest of the world than it does in North America. And the reason is because we are selling the same products. I am hopeful and I believe that, that will change over time. It will be a lot more rapid as you bring on Hitachi product line since you remember that’s a different product and a light commercial product line, and that market is actually going quicker. So I don’t know that I will be able to be a whole lot of color except that about the market as much as this is more about us and I think how aggressive we have been in the marketplace to gain share. I don’t know that it’s about the marketplace I think it’s more about us. And I would expect as soon as we are able to bring Hitachi on board to be able to see the benefits of being able to participate in the VRF market, which we see is growing almost 10%.

Okay. And just where are you in that expansion to second and the third tier cities as well in terms of building out the brand for whatever structure using branch distribution are there more cities to come?

Absolutely. I think we are in the early stages, as it relates to the opportunity particularly as we get more products because as you move further and further away from Tier 1 cities, you need a broader set of products particularly at the light commercial and we really just haven’t had that full complement of products. So I think we are going to have even more impetus around that. We have got a long way to go.

And on North American HVAC, you are definitely seeing orders picking up. But how long do you think this recovery could last? Is this just a kind of bounce off the bottom or do you see any structural tailwind in your institutional markets?

I just think – this is Alex. I think by its nature the fact that it’s happening in the institutional market is usually a much more of a structural than some of the commercial markets. So I think when we are seeing the institutional and government money being spent, I mean, I think the thing to keep our eye on is health care because it has grown some and I would say if there is anything that would be less certain and less predictable is what’s going to happen in the health care market. But if you look at the local government, schools, state government, those seem to be pretty strong in the pipeline strong. So I think that we are in a good cycle for those markets. For health care, I would never consider a victory yet because I think that market is still under a bunch of change, but we are seeing improvement but I don’t know that if I would consider it a victory.

Okay, final quick housekeeping question, Power Solutions, China, can you kind of update us on the OEM versus aftermarket split there and how you see that developing?

Yes. Brian its Bruce here I think Glen will follow-up with specific numbers. But I think what we are sort of giving you that commentary here on the market. I think the most noteworthy thing that we are seeing is we have talked about this last couple of quarters, but really rapid acceleration in AGM demand from the customers. We were awarded just in this quarter a $1.4 million unit order. We talked on our last couple – on our last call around that we are adding AGM production in the north plant, where we are looking to do sort of half AGM and half SOI. It’s looking like we are going to have to pivot away from that and put in all AGMs. So, lot of customer interest in the AGM product line and that’s great for us.

We do have, it’s Glen here, on aftermarket in China, it’s somewhere between 45 million and 50 million units today going to somewhere around 80 million by the end of the decade, Brian. And we think our share goes by 40% of our business being aftermarket to like 60% of our business being aftermarket only at the same timeframe.

Okay. Okay, thanks.

Okay. Our next question comes from the line of Mr. Rod Lache. Sir, your line is open.

Good morning, everyone. It’s actually Pat Nolan on for Rod.

Okay.

A couple of quick questions just to follow-up on that last year’s questions on the healthcare side of the business. Can you just refresh us, because it seems like that part is actually not growing, how big of your business today is just healthcare, not institutional, just healthcare?

About $1 billion, $1.5 billion, something like that.

Yes, I was going to say it’s around 20% overall, but we could get back to you to specific numbers.

Okay, that would be perfect. And to switch gears a little bit, on the Power Solutions business, it seems like you are getting incrementally more positive on the gross and AGM. How does that play into the 5% to 6% annual growth that you have been expecting over the mid-term? Do you think that could potentially push you beyond that target or push towards the high-end? How do you think about that expanding growth in that context?

That’s a good question. I think we have – just to be completely honest, I think that we have been caught off guard with how fast the AGM market has grown in the last couple of quarters. As you can tell as we talk about the orders that we have received in China, the growth that we are now seeing in North America we had been expecting at some point, but it’s really come very quickly. So, I don’t know that we have those exact numbers. It’s something that we need to pull together, but you could probably tell by the way that in reacting we are adding capacity at a rate that we didn’t actually expect even a year ago. So, good question. I think we probably owe everyone some follow-up, but the bottom line is really good news for our business, because our position in the AGM market is significant.

It’s still probably somewhat smallish as far as moving the needle even without acceleration here early on at least, because I mean we are talking about 10, 11 million units in ‘15 here, as we exit ‘15 out of 140 million units total. So, while the percentage is moving and it probably doesn’t have an impact, it’s not like it’s going to move at multiple points.

Got it. Thanks so much, guys.

Our next question comes from the line of Mr. Joe Spak. Sir, your line is open.

Thanks, everyone. Maybe just one more on AGM, while we are talking about it, you sort of talk about the profitability on those units being about 3x of that asset. It’s been a while since we heard an update on that. Is that still – is that what you have been realizing and is that still sort of the right way to think about that profit mix?

It hasn’t changed. Yes, same, so still 3x the profit dollars I believe is what we have talked about it.

And I think – I have made some comments about we are starting to see some aftermarket growth here. So, I think there is an opportunity to improve on that as we go forward.

Right. And then I know it’s too early to think about – maybe it’s too early to think about the pressure on the auto spend, but what about the other side of that? Any thoughts on what the leverage opportunity is on remaining JCI?

On the – so, I don’t think we are ready to talk about the capital structure. But what I would tell you is that we will – regardless of what the dividend side is we will be in a very good position to make – to need to make those choices around capital structure, but what we do is with a very, very strong balance sheet.

Okay. And then quickly on – I appreciate all the color on China, specifically with the controls growth you are showing there on the order side, is that related to sort of the build out you are talking about in the other tier cities or because that’s mostly goes with new construction as opposed to retrofit, is that correct?

Yes. So, I will just be 100% honest. When I saw those numbers, that can’t be just – that has to be some unique success that we have had with the quarter, certainly not the marketplace. So, I don’t want to make something up to know why those numbers are as high as they are, but I think it’s just representation as why we wanted to bring it is that we are seeing it across all of our product lines. I don’t know they have a lot more information on that exactly why it’s so much different than our equipment business.

Okay, alright. Thanks a lot.

Okay. Our next question comes from the line of Rich Kwas. Your line is open.

Hi, good morning, everyone.

Hi, Rich.

Just, Alex, on the – so, on the proceeds, the net proceeds from GWS $1.3 billion, you got Hitachi you are going to make the payment for that here in the next quarter or so. The remaining funds how should we think about that? I know M&A is the focal point, but what’s the appetite to do incremental buyback above and beyond what you outlined?

Yes. So, I will turn this over to Brian in a second, but from a strategic standpoint, I think that when we start embarked on this, hopefully we demonstrated that we are going to make what’s the right choice not only for where we are at the moment, but also strategically. And it’s probably going to have a lot to do with where we are with some of our opportunities for investment, but we do recognize that we will have an opportunity to maybe change the pace at which we do some of the buybacks if we choose to.

Yes. I think, if you look at the $1.3 billion, Rich and then it’s roughly $500 million investment we will make in Hitachi joint venture that leaves you with $800 million. Couple areas that we are going to be looking at, we have got potentially a pension contribution that we could make on a discretionary basis to essentially get the plans funded at the level we have historically targeted. We are going to have in the fourth quarter here through the adoption of some new mortality tables about a $200 million increase in our liability. So, we may use some of the proceeds to pre-fund the pension. There is also certainly in the share repurchase area we have got $200 million left on this year’s program and we could pull some forward potentially from next year’s $1.2 billion. And then there is also some moving parts just relative to tax payments. So, I would say, we are kind of – we are going to look at various options there and we will see certainly keep our flexibility.

Would the discretionary investment be matched at $200 million increase in the liability be more than that?

The $200 million is right now what we think the ballpark increase in the liability from the new mortality tables.

Okay. So you would match that and then go from there.

Yes.

Okay. And then just the couple of housekeeping items, Brian, the $1.5 billion of free cash, does that include the $150 million from GWS?

We include what?

The $150 million from the joint ventures.

I thought GWS generated about $150 million in annual cash flows. So, does the $1.5 million include that? Does it include the disc ops?

Yes, it does. Yes.

Okay, alright. And then for the fourth quarter, you cited in terms of the guidance commodities, I just wanted to get some additional color on that given that metals prices have come down and I don’t know if that’s material?

Yes, I think its diesel cost is what we are looking at. And then from a currency standpoint, the real or kind of the two items that seem to be offsetting the benefit of going from 105 to 110 in the euro.

Okay, okay. Thank you.

I think actually we are done here, because we are at the top of the hour. Alex, any concluding remarks?

Yes. I just want to once again thank our employees for not only the incredible performance that they have provided, but all the support that they are giving us is as we move forward with this transformation to accomplish an awful lot, we have got more to do. And I think our employees are not only are they actually making this happen, but I think they are very proud of what they have been able to accomplish and they should be. Thank you.

Great. Thanks, everybody. Kathy and I are available for the balance of the day with any follow-ups that you have got. Thanks very much.

Thank you. That concludes today’s conference. Thank you all for participating. You may now disconnect.