Good day, ladies and gentlemen, and welcome to the Northrop Grumman's Third Quarter 2018 Conference Call. Today's call is being recorded. My name is Jamie, and I will be your operator today. At this time, all participants are in a listen-only mode. I would now like to turn the call over to your host, Mr. Steve Movius, Treasurer and Vice President, Investor Relations. Mr. Movius, please proceed.

Thanks, Jamie, and welcome to Northrop Grumman's third quarter 2018 conference call. Before we start, please understand the matters discussed on today's call constitute forward-looking statements pursuant to Safe Harbor provisions of Federal Securities Laws. Forward-looking statements involve risks and uncertainties, which are detailed in today's press release and our SEC filings. These risks and uncertainties may cause actual company results to differ materially. Matters discussed on today's call may also include non-GAAP financial measures that are reconciled in our earnings release. We have posted a slide deck to our IR website that summarizes our guidance, updates the three years of pension information we previously provided, and includes a five-year schedule of amortization of purchased intangibles and the step-up in depreciation of acquired property, plant and equipment. On the call today are Wes Bush, our Chairman and CEO; Kathy Warden, our President and Chief Operating Officer; and Ken Bedingfield, our CFO. At this time, I'd like to turn the call over to Wes.

Thanks, Steve. Hello, everyone. Thanks for joining us. I want to start the call by thanking our entire team for their continued focus on execution and performance. Our third quarter results demonstrated robust performance with topline growth and strong operational execution. The quarter included the first full quarter of results for Innovation Systems. Based on our strong performance, we're increasing our guidance for the year. Kathy and Ken will review the operational and financial results. I'm delighted to note that for the first time in a decade, the Department of Defense begins this fiscal year without a continuing resolution. The fiscal year 2019 defense appropriation bill received very strong bipartisan support, passing the Senate with a 93 to 7 vote. We view this support as well as the administration's focus on accelerating innovation efforts as signals that the Congress and the administration are aggressively addressing the threats emerging across multiple domains and are increasing our nation's pace of modernization and investment. Our own programs continue to be well supported in the budget, and our portfolio is well-balanced between mature franchise production efforts and the development programs that will ultimately lead to the next generation of production programs. In the context of an improving budget environment, we've aggressively invested in supporting our customers' need for advancing capabilities, including the addition of Innovation Systems, while also driving affordability. We're focused on performing on our current programs and pursuing attractive new programs in our robust opportunity set. Overall, I'm very pleased with our team's year-to-date accomplishments, and I'm excited about the many opportunities before us. I'm also excited about the future of our company under Kathy's leadership. She has demonstrated a solid focus on creating value for all of our stakeholders, and she brings the leadership capabilities and values to lead our great company forward. So, let me turn the call over to Kathy to give us an update on our third quarter results. Kathy?

Thanks, Wes. Good afternoon, everyone. Wes, I want to first express our gratitude for the way you've led our team in creating value, while always maintaining the highest standards of ethics and integrity. On behalf of the entire Northrop Grumman team, we thank you.

Thanks, Kathy.

My comments today will address third quarter financial and operational highlights for each of the sectors, including a status on our Innovation Systems integration. Beginning with our financial results, the businesses generated solid topline growth and strong segment operating income and margin rates during the quarter. Sales increased 23% to $8.1 billion, reflecting a full quarter of Innovation Systems, as well as continued topline growth at Aerospace Systems and Mission Systems. I'd also note that international sales rose 22% year-to-date and we ended the quarter with total backlog of $52.6 billion. We continue to see strong demand from international customers. At the end of the third quarter, Japan announced their decision to purchase an additional nine E-2D Advanced Hawkeyes, bringing their total planned E-2D purchase to 13 aircraft. Third quarter segment operating income increased 29% and our segment operating margin rate increased 60 basis points to 12.1%. In addition to this quarter's strong operating performance, third quarter financial results benefited from the settlement of cost claims as well as a lower tax rate. These factors combined to generate a 78% increase in third quarter net earnings and earnings per share. As a result of our strong third quarter and year-to-date performance, we are increasing our guidance for 2018 earnings per share to a range of $18.75 to $19.00. Turning to cash and capital deployment, our strategy remains the same: Invest in the business, manage the balance sheet and return cash to shareholders through dividends and share repurchases. During the quarter, after reflecting the discretionary pension contribution, cash from operations totaled $812 million and $1.45 billion year-to-date, and free cash flow was $530 million for the quarter and $664 million year-to-date. Based on those year-to-date results, we are increasing our guidance for free cash flow to a range of $2.5 billion…

Thanks, Kathy, and good afternoon, everyone. I'll add my thanks to our team for their performance and I'd also like to thank Wes for his outstanding leadership. I'll briefly review our third quarter and year-to-date results and update our 2018 guidance. Overall, it was a good quarter with solid awards and sales with strong margin rates and earnings growth. I'll cover the sector results and guidance for the remainder of the year, then move to below-the-line corporate items including pension. Turning to sector results, Aerospace Systems sales rose 5% in the quarter and are up 9% year-to-date. Higher volume during both periods continues to be driven by higher Manned Aircraft volume, principally restricted activities, and ramp-up on the F-35. Autonomous Systems sales were also higher during both periods as we continue to ramp up on Triton production. Volume for Space was slightly lower for the quarter and year-to-date. Aerospace operating income is up 9% for both the quarter and year-to-date. Third quarter operating margin rate increased 50 basis points to 11.5%, primarily due to improved performance in Manned Aircraft and Autonomous Systems programs. Year-to-date margin rate is 10.8% comparable to last year. While AS margin rates continue to reflect a higher level of early phase development work, we're quite pleased with the year-to-date performance. Based on year-to-date results, we are increasing AS sales guidance to a range of $13 billion to $13.2 billion and we now expect AS will have a mid-to-high 10% operating margin rate for the full year. Moving to Innovation Systems, third quarter sales totaled $1.4 billion, which, when compared with the pro forma results for last year, represents a 16% increase. Third quarter sales were higher across all three IS business areas. Defense Systems sales reflect increased armament systems and missile products volume. Higher sales for…

Thanks, Ken. In the interest of time, I would ask each participant to limit themselves to a single one-part question. Jamie, would you initiate the Q&A?

Your first question comes from the line of Myles Walton with UBS.

Hey. Good afternoon.

Hey, Myles.

I was wondering on Innovation Systems, I mean, that's pretty stellar growth out of the gates. And I'm just kind of curious. I'm not one to usually believe in revenue synergy, but are you hitting revenue synergies in, kind of, year one? And what is the underlying growth rate you expect over the medium term for this business?

So, Myles, thanks so much for recognizing the solid performance that our IS team delivered in this quarter. We, too, are very pleased with what they have delivered. I'll tell you, we are on track for the cost synergies that we defined for 2020, and we are making good progress on revenue and operational synergies. Those are being worked. Those will become much more material in the next few years. A lot of the good performance that we're seeing right now is a result of just continued strong growth in the markets that IS serves. We do anticipate that the revenue synergy, as I said, becomes evident in 2019 and much more material in 2020 and beyond.

Your next question comes from the line of Carter Copeland with Melius Research.

Hey. Good morning, and congrats, Wes. It's the end of an era. Congrats on the performance. It's been amazing.

Well, thank you.

I just – I can't help but ask, given some of the other calls, I mean, you chose to no-bid two pieces of work that have now led to a bit of noise around bidding strategies and potential losses and whatnot. And I just wondered if you'd share your perspective on whether you think this could potentially change bidding behavior, not necessarily for you, but around the industry, and are we beginning to see differences in cost structures or product positioning with respect to KPPs or return hurdles? Any perspective you could share on those, I'd appreciate it.

Yeah, Carter. No, I appreciate the question. And I would just – I'd offer two perspectives: one through sort of the lens of industry, and the other through the lens of the customer. On the industry side, clearly, every company has to make its own decisions about how it will approach the economics of any particular deal. And they have to look at it both in terms of the deal itself and in terms of its broader base of business and how all those things factor together. I like the process we've been using for a number of years. We have a very clear-eyed view of what the economics are likely to be. We spent a lot of time thinking about true net present value and, obviously, when you dig a big hole early, it's hard to get to good NPV. But again, I would not presume to know the economics of other companies and be in a position to comment on how individual decisions get made. And I would suggest that as we go forward, clearly, any company will have some finite appetite for how much of investment it can make in various areas. And those appetites change a little bit from time to time, but at the end of the day, we are generally a pretty well-managed industry. When I look across the landscape, there are really smart folks running the companies in our industry and, at the end of the day, they're going to have to make decisions that look at sort of their total picture, not just the individual project pictures. And they're going to have to figure out how much appetite there is for different elements of those types of decisions. On the customer side, the customer has to understand all of this as well.…

Your next question is from the line of Jon Raviv with Citi.

Hey. Good morning and congratulations, again, to Wes. Or sorry, good afternoon, I should say at this point. Sort of following on that question, just some broader perspectives on investing in this growth environment. For example, CapEx, we've been waiting for a few years for CapEx to peak. Any visibility as to when that might come down again? And sort of related is, as you make these investments, what's the sort of sales growth visibility associated with that? Essentially how long is the runway for sales growth now that we have the FY 2019 budget in place?

Thanks, Jon. Appreciate the question. Maybe I'll lead off, hit the CapEx and then turn it over to Kathy for a little more color on where she sees that as well as the sales growth opportunities. In terms of CapEx, we have been investing to drive the growth that we are seeing and the existing program portfolio and the growth opportunities in front of us. I would say that we continue to expect that CapEx will stay at increased level in 2019 and then we should start to see it moderate as we look forward after that in both dollars and in a percentage of sales for sure as we continue to drive growth in the business. I would say that there could be a blip out beyond that if we are successful on some additional development programs. We've been clear that GBSD is one that, should we be successful in the down-select from 2 to 1, that, that is something that could drive some additional amount of capital, but I don't think it's particularly material compared to what we've seen here in the last few years as we've been driving for growth, again, in the portfolio as well as some of the newer programs. Kathy, did you want to add some color on that?

Just to follow on what Ken said, we certainly see investing in ourselves as our primary focus and we do have growth opportunities both near and longer term. We have been very pleased with what we saw in the 2019 budget for our programs as well as opportunities that we're pursuing. And you will continue to see us have growth in restricted and pursue a significant set of opportunities, including GBSD that if we are successful could lead to additional CapEx expenditure. But as Ken said, at the current moment we see that starting to top out next year.

Your next question comes from Seth Seifman with JPMorgan.

Thanks very much. Good afternoon.

Hi, Seth.

Hi. I was wondering – this might be a bit of a sloppy calculation with the acquisition cost and stuff like that, but on a pro forma basis, it seems like maybe you're about three times net levered right now with close to $2 billion of cash to generate in the fourth quarter to take that down. So, how do you think about when you can really kind of get back into the market to buy back stock?

I would say, Seth, that as we look at our leverage, we are quite comfortable with where we are from a leverage perspective. We were able to take advantage of our credit rating at the time of the acquisition to execute on the acquisition, the issuance of the debt, and to essentially see a single notch downgrade from a couple of the credit rating agencies and hold with one. As we have de-levered, both on some OA debt as well as a little bit of our debt, and we expect to de-lever another tranche that's due in 2019 for us. We see the ability to drive back to our traditional BBB+ credit rating. But to be clear on the second part of your question on the share repurchase, we were out of the market at the time of the acquisition. That was not related to a leverage issue that was related to the fact that we were in the process of the acquisition, we're in possession of material non-public information, and could not, therefore, enter into a plan to execute on share repurchase. We are pleased that the acquisition closed on June 8 – I'm sorry – June 6 and within a couple of days from there, we were able to get back into the market and we continue to be and expect to be in the market on share repurchase as we look forward. So quite satisfied with the leverage. I do expect as we grow the business, grow the cash, grow the EBITDA, we will continue to see that leverage number drop on us.

Your next question comes from the line of Ronald Epstein with Bank of America Merrill Lynch.

Yes. Good afternoon.

Hey, Ron.

Maybe a question for both Kathy and Wes. Now that you have the OA assets within the Northrop family, how do we think about the opportunities in front of you in classified space, hypersonics, that kind of thing? Because it seems like, strategically, those assets put you in a better position to win some of that work than had you not had them?

So, Ron, this is Kathy. I'll start and then Wes can add in. You see it exactly the way we do. We see clear opportunity for us and jointly pursuing opportunities in space, hypersonics, precision munitions. These are areas where the portfolio in bringing together IS with the rest of Northrop Grumman, we clearly see synergy. And just as important, we see the opportunity to really shape where those markets go through innovation and increased affordability. The cost synergies that we'll generate in bringing the teams together will also contribute to our competitiveness. So, on all of those dimensions, we see that we are now able to offer more options in the markets I mentioned, as well as others, and that will be our primary sources of revenue synergy, which create the value over the long term from bringing the IS team into Northrop Grumman.

Yeah, and I would just completely agree with what Kathy said. I think this is turning out to be just a wonderful bringing together of two companies. The only thing I would add is I've just been delighted to see the very nice culture match and the almost instant desire on the part of all of the individuals involved in this, with respect to both of the companies that came together, to start getting together and creating new ideas, and new ideas are the source of value creation. That's how over the longer period of time, we're able to better serve the customer. And I think that's what the customer is expecting of us, quite frankly, as we bring the companies together. So, I'm really excited about that because we're already seeing those connections being made and those ideas beginning to be generated. So, I'm very optimistic about what this will mean.

Your next question comes from the line of Rajeev Lalwani with Morgan Stanley. Rajeev Lalwani - Morgan Stanley & Co. LLC: Hi. Good afternoon. Kathy, Ken, just a question for you on the Aerospace margins side. You had some nice trends here in the quarter and I think year-to-date. I mean, does this create a runway to maybe getting back to the low-to-mid-teens as we look forward over the next couple of quarters and years?

So, Rajeev, I'll start, and then ask Ken to add in. But what I see is just really strong performance on the part of our AS team. The blocking and tackling that goes in to good solid program execution is what is leading to the margin improvement, and we clearly see that potential to continue. We incentivize the team clearly to continue to find opportunities for program performance improvement that leads to margin expansion. And so, what we are seeing is a clear result of that alignment of the team's objective to our shareholder objectives, and we expect it to continue. I'll let Ken speak a bit more on the details.

Yeah, I would say that we've seen mix as being the single largest impact on our margin profile at AS in terms of the lower margins over the last couple of years. To Kathy's point, I think we've seen that the sector is also performing on its portfolio programs both on the production and on the development side and is driving its performance up. I would just say that as we look forward, some of the larger development opportunities could be at the Aerospace sector. And if we are to take on some more mix challenge in terms of some additional development programs, then we could see some additional pressure on margin rates as we look forward. But with a significant growing top line that AS has had, we have seen nice growth in margin dollars even with some of the rate compression over the last couple of years. And, Rajeev, just to make sure we're all on the same page in terms of your question, you referenced sort of low teens. I would just say, if you look back historically, AS has tended to run in the 12s (38:36) and certainly our benchmark for AS is 11 (38:41) and we incentivize them to do better than that. So, just to kind of level set us all on where AS has been and make sure we're all on the same page there.

Your next question is from the line of Peter Arment with Baird. Peter J. Arment - Robert W. Baird & Co., Inc.: Yeah. Thanks. Good afternoon. Wes, best of luck with everything.

Thanks, Peter. Peter J. Arment - Robert W. Baird & Co., Inc.: Kathy, can you maybe give us – you mentioned some consolidation at TS. Do you anticipate any portfolio shaping out of that or maybe just give us some updates how the timeline looks for when the actions will be completed? Thanks.

Yes. So, the new structure at TS is aimed at creating a better focused organization on innovation and affordability, and we are implementing that at the beginning of 2019. As many of you know, we've been on a journey over a couple of years to eliminate the majority of the commodity-based services work that we have in the TS portfolio. And next year, it'll continue to be somewhat of a tough compare as we had VITA in the portfolio through most of third quarter this year. But the logistics business at TS is growing. All segments of TS are winning new work, and those new programs are achieving strong margin rates. So, we really see that we now have a services business that has a solid foundation for growth in the long-term and healthy program performance. And so, that's really what we're working to optimize through this restructuring that we'll do at the beginning of January, and we'll go from three divisions down to two.

Your next question comes from the line of Sheila Kahyaoglu with Jefferies.

Hi. Good afternoon, and Wes, congratulations.

Thanks, Sheila.

Kathy, in your prepared remarks, you mentioned a whole host of opportunities of program progress. I guess, how do you think about the longer-term growth profile of Northrop? And just outside of F-35 and restricted programs that have been a significant driver, maybe some opportunities you could point to or are significant areas of higher growth?

Yes. Thanks, Sheila. So, I made the comment about our growth prospects in the comparison to the investment accounts, which are what we typically think of as the proxy for our growth. And when I think about over the long-term, I'm talking multiple years. And so, many of the things that we're pursuing are awards in the 2020 timeframe. And to give you a few examples, as you asked, we have both for the OPIR programs, the GEO payload as well as the OPIR Polar satellite programs in our pipeline. We were full-force awarded the OPIR Polar, and I talked about the GEO payload program down-select that will be made in 2020. We also have a number of restricted space programs, and any one of them isn't as material as the collection of the handful that we are pursuing. We also have several full-rate production programs over the next two years. I talked about G/ATOR and CIRCM and IBCS all in my comments earlier. Those are all in Mission Systems, but all represent significant full-rate production awards in the next two years. We are competing for down-select in a number of areas. I talked about OmegA today. You all know we are competing for GBSD and have made it through the first down-select, and we also have been down-selected on Next-Gen Jammer low band. So all of those are competitions that we'll pursue over the next couple of years. And so, as you can see, it's across all of our businesses, Aero, Innovation Systems, Mission Systems and Technology Services that we have a robust pipeline as well as, as you noted, the growth that we have on current programs that are still ramping up to their full potential, like F-35.

Your next question comes from the line of Hunter Keay with Wolfe Research.

Thank you. This is an off-beat question, I suppose, here, but Wes, I'm kind of curious to know what's next for you? Where might we see you next? What are you passionate about? Are we going to hear from you again?

Unlikely that I'll just disappear. But I have a number of things that – outside of our industry, that are of great interest to me, both on a personal level and, hopefully, in terms of being helpful to others. I'm going to take a little bit of time to sort all those things out, to figure out exactly where I want to focus my energies and my passion, but I'm looking forward to the opportunity to do that. And I very much appreciate the question, Hunter. It's been just a lot of fun to be involved in this for so long. But hopefully, I can find some other good things to do that will be helpful to others.

Your next question comes from the line of Rob Stallard with Vertical Research.

Thanks so much. Good afternoon.

Hey, Rob.

Good afternoon.

First of all, all the best for the future, Wes. I hope you have a good time.

Thank you.

And then, secondly, Kathy, you mentioned the very strong year-to-date growth in export markets. I was wondering how sustainable do you think that growth rate is looking forward?

Rob, we see that growth rate as sustainable in that a number of the opportunities we are pursuing, including Global HALE, as well as the then sustainment for those products that we're delivering to continue strong pipeline there for other countries that are seeking that capability, as well as additional units. I spoke today specifically about, also, the E-2D growth that we're seeing in Japan and we anticipate that that kind of growth will also continue worldwide. And so, those are just a few examples that across all of our areas, Space, Cyber, Autonomous, Manned Aircraft, as well as the Sensors that go on those aircraft, we are still seeing strong growth potential in, particularly, Asia-Pacific, but also some notable programs in Europe.

Your next question comes from Sam Pearlstein with Wells Fargo.

Good afternoon.

Hi, Sam.

I was wondering if you could talk a little bit about performance. You didn't – I guess, one is, can you give us an update on some of the programs from last quarter, say, the James Webb and the Advanced Capabilities program? And despite no, I guess, headline performance issues in the release, the unfavorable EACs did move up to $147 million in the quarter, which is up from the last quarter. Can you – are there any particular issues you can highlight that might have been behind that?

Sure, Sam. Let me maybe start with the second part of the question, and then Kathy can comment on the programs. I would say, from a negative EAC perspective, there's nothing there that I would point to. I would remind you that in the second quarter, some of the adjustments that we referenced were not recorded as negative EAC adjustments because they were with respect to options that had not been exercised and, therefore, some of those margin headwinds were not in that negative adjustment chart. And looking at the performance for the quarter, we're quite satisfied; all of the sectors performing well. We do have a large and diverse portfolio of programs that are always going to have some ups and some downs. And we try to take a solid approach to booking rates not exceedingly conservative, but not exceedingly optimistic, middle of the road. And that's going to mean you're going to have some ups and downs, particularly with a program that's as diverse and, quite frankly, complicated as ours. And so, no concerns. And on the programs themselves, I would just say nothing to comment on negatively from a performance perspective. And with that, I'll turn it over to Kathy.

Quite the contrary. We have good performance closing out the contract on VITA. And so, that process has gone exceedingly well. We also, on James Webb, have been executing according to the plan that we laid out earlier this year in conjunction with NASA, and the team is progressing through INT quite well. So, on both of those efforts, we have delivered just as we anticipated through the third quarter.

Your next question comes from the line of David Strauss with Barclays.

Thanks. Good afternoon.

Hi, David.

Ken, I think a question for you. Wanted to ask about how we should think about free-cash-flow conversion from here. It looks like this year you're going to be in the 70%, 75% range. All the different moving pieces going forward in terms of CapEx, working capital opportunity, pension, and all of that, how we should think about that trending from here? And then, a real quick one on pension. I get why the FAS side gets a little bit worse than what you were expecting previously, but it looks like you took 2020, the CAS number, higher. Can you just talk about what's going on there? And I think you've also said that you would expect CAS to actually go up kind of in the 2022 timeframe? Thanks.

Sure. Appreciate the question. From a free-cash-flow conversion perspective, I guess I would say that when you have some of these items like we had in this quarter with respect to the cost claim and we certainly had some tax items that are not necessarily going to result in cash tax savings in the year, they result in some future opportunities for cash, you can get some lumpiness in your cash conversion percentage. I think the important thing to focus on is the ability of this business to generate cash as we look forward. And this should be a business that generates a strong, both operating cash flow as we look forward as well as free cash flow. And largely, I would say, our free cash flow conversion should be increasing as we look forward. In particular, if you exclude some of the one-time items we've had this year as well as over the past couple years in terms of some either margin or tax benefits. And then, also as we look forward, we've mentioned that 2019 should be another year of, kind of, heavy – heavier capital expenditures, and that we should start to see that moderate, both in dollar terms and in percentage of sales terms, as we look forward. So that should help from a free cash flow conversion perspective. Additionally, going to your question on the CAS, I would say that CAS is certainly less sensitive to a number of assumptions than FAS is. But when we see, as we mentioned this year, we've got, call it, roughly break-even returns through September 30. That will result in some increased CAS as we look forward, and I think that's what you're seeing on the 2020 CAS line. And I would say that pension should continue to be something that is not necessarily a headwind for us from a cash or free cash flow perspective. We continue to see a profile where our CAS should be in excess of our required funding. So overall, this should be generating a fair amount of cash as we look forward. And I would say our conversion should be strong, although we always look to continue to drive operating excellence even when that means the cash might trail a little bit of time just managing all aspects of the business.

Your next question comes from the line of Cai von Rumohr with Cowen and Company. Cai von Rumohr - Cowen & Co. LLC: Yes. Thank you very much. So Lockheed Martin increased their sales guide for this year and for next year, and they cited the fact that the FY 2018 budget got done early. We have an FY 2019 budget early. Congress threw some more money in the pot for the F-35 and the F-18 programs on which you also are a participant. As you look at next year, does your revenue growth look better today than it did three to four months ago?

So, Cai, I'll take that question. And I'll also remind you that we'll give you full guidance at the end of the fourth quarter call in 2019, in January 2019. But as we are approaching the end of this year and looking forward into 2019, I mentioned that our programs have been well-supported in the 2019 budget, and we do feel as if we will continue to see the kinds of growth that we have experienced in 2018 into 2019. And we will reduce some of the headwinds that we had particularly in Mission Systems with the two programs that Ken noted, and we will start to get through the headwinds that TS has seen through the three programs that we have noted throughout the call this year. So in terms of compares, we will be in a more favorable place as we head into 2019. But I will also state that the growth that we have seen historically going into 2017 to 2018 was very solid. So we continue to grow off of prior years of strong growth in the sectors as well. And, Ken, I don't know if there is anything that you'd like to add there.

No, I think you hit it on the point there, Kathy. And it's right that we have seen – again, we have a diverse portfolio, and there's always going to be some ups and some downs, and we've seen some programs that have been working their way out of the system this year. Some of those will have a little bit of impact in the early part of next year but largely should work themselves out of, kind of, the compare from year-over-year in the earlier part of 2019. And I'm with you. I think we really feel like we have the ability to grow this business and feel very positive about how we're positioned. Now with that, Jamie, I think maybe we'll take just one last question.

Your final question comes from the line of Doug Harned with Bernstein. Douglas Stuart Harned - Sanford C. Bernstein & Co. LLC: Thank you. Good afternoon.

Hey, Doug.

Hi, Doug. Douglas Stuart Harned - Sanford C. Bernstein & Co. LLC: And, Wes, I'm sure you're going to find plenty of good things to do, but we will miss you here.

Thank you, Doug. Thank you. Douglas Stuart Harned - Sanford C. Bernstein & Co. LLC: I have a question about the Orbital acquisition. And as you set up the Innovation segment, where you've got three groups there, and when you look, over time, to really get synergies with Mission Systems and with Aerospace, one would think you've got to change that organization around or these organizations around significantly to optimize that. So, my question is how are you thinking about evolving these organizations, and in terms of the things you need to pull together to get the most value out of them? And what kind of timeframe are you looking at for that?

Thanks, Doug. So, clearly, my primary focus over the course of 2019 is to make those evaluations, look at the portfolio. We are, as I said, developing our revenue synergy opportunities, and those will inform my thinking about how we need to ensure we operationalize and organize to execute on those synergy opportunities. But what I also value in bringing that team in as a standalone sector is the transparency that we will get as we work our way through 2019 around the cost synergies that we want to achieve full run rate of by 2020, as well as the opportunity to make sure we are implementing the best of both models that we have established. There is a lot for Northrop Grumman to take in terms of value from the way Innovation Systems operates. And likewise, the opposite is true. And so, we have had the best-of-both mentality, we're executing on a well-thought integration plan to help us achieve that, and so really I want to focus the better part of next year on realizing those cost synergies, executing on best of both, ensuring that they have solid operational performance, and then look through the revenue synergies to inform my thinking about any changes that we might make.

Thank you. At this point in time, I would like to turn the call over to Wes for some final comments.

All right. Well, thanks, Steve. I asked Steve to save me a little time at the end of the call so that I can say a few words as I wrap up my last earnings call with the company. I want to take the opportunity to publicly say thank you to the amazing team of Northrop Grumman. It's a humbling experience to work with so many brilliant people, who are absolutely committed to serving our customers and advancing global security. I will tell you that this team rises to every challenge, and it is critical that we do as those we serve, our customers around the globe, are people we genuinely care deeply about. I'm grateful to have had the opportunity to work with such incredible people in our company and in our customer community. And it's been a real privilege to serve in so many roles in our company over the years and especially in the roles where I've had a chance to engage with the community of analysts and portfolio managers. I've sincerely enjoyed working with all of you in the financial community ever since I became CFO way back in 2005. The research that you perform, the questions you pose and the objectives you help frame really do make our companies better. I sincerely value what you do and how you do it, and I want to express my appreciation for the opportunity to work with all of you for so many years. So, while looking backwards is important to do periodically, I'm actually more excited about looking forward. Our company is fortunate to have an exceptional leader as our new CEO and I'm confident that the best years for Northrop Grumman are the years ahead of us. So, thanks for joining us on the call, and thanks for your continuing interest in our company.

Ladies and gentlemen, this concludes today's conference call. Thank you for our participation.