Good afternoon, ladies and gentlemen, and welcome to the Willis Towers Watson Fourth Quarter 2018 Earnings Conference Call. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session and instructions will follow at that time. [Operator Instructions] As a reminder, this conference call is being recorded. I would now like to turn the conference over to your host, Mr. Rich Keefe, Director of Investor Relations at Willis Towers Watson. Sir, you may begin.

Good morning. Welcome to the Willis Towers Watson earnings call. On the call with me today are John Haley, Willis Towers Watson's Chief Executive Officer; and Mike Burwell, our Chief Financial Officer. Please refer to our website for the press release and supplemental information that we issued earlier today. Today's call is being recorded. Some in the comments in today's call, we constitute forward-looking statements within the meaning of the Private Securities Reform Act of 1995. These forward-looking statements are subject to risk and uncertainties. Actual results may differ materially from those discussed today and the Company undertakes no obligation to update these statements. For a more detailed discussion of these and other risk factors, investor should review the forward-looking statements section of the earnings press release issued this morning. As well as other disclosures in our most recent Form 10-K and other Willis Towers Watson SEC filings. During the call, we may discuss certain non-GAAP financial measures. For reconciliation of the non-GAAP measures as well as other information regarding these measures, please refer to the most recent earnings release and other materials in the Investor Relations section of the Company's website. After our prepared remarks, we'll open the conference call for your questions. Now, I'll turn the call over to John Haley.

Thanks, Rich, and good morning everyone. Today, we'll review our results for the fourth quarter of 2018 and for the full year, and then we'll provide a brief commentary on the outlook for 2019. Before discussing the 2018 financial results, I'd like to reflect on our journey since the merger. The fourth quarter of 2018 marked the end of Willis Towers Watson integration activities. Over the course for the last 3 years, we faced many challenges and I'm extremely proud of the progress we've made. Our success is evident in the financial results. We executed on our synergy goals for margin expansion for revenue growth and for lowering tax rate, and we nearly doubled our free cash flow in 2018. In short, we made a commitment to create long-term shareholders value and we delivered. I believe with our continuing focus on servicing clients and strategic investments in innovation, we're well positioned to deliver sustainable growth into the future. I'm also honored that Willis Towers Watson was recently included on Bloomberg's 2019 Gender Equality Index as it demonstrates our commitment to equality and advancing women into workplace. Gender equality essential at Willis Towers Watson wired commitment to inclusion diversity as we stride to attract retain and develop the very best talent to best serve our clients. This year at the World Economic Forum at Davos, Willis Towers Watson was a co-sponsor of Bloomberg-wide the year ahead Davos even where Julie Gebauer, Head of Human Capital and Benefits spoke about the value of broadening perspective as part of the gender equality conversation. Participating in the World Economic Forum was an exciting opportunity for us to share our perspective on critical topics like the future of work, inclusion and diversity, climate finance and cyber risk. It's clear that we're entering in area that…

Thanks, John, and good morning to everyone. Thanks to all of you for joining us. I'd like to add my thanks and congratulations to all our colleagues for their efforts and contributions to our strong finish and our overall financial performance in 2018, and thank our clients as well for their continued support. My comments around our 2018 results will discuss our results without the impact of ASC 606 unless otherwise stated in order to assist with comparability over the prior year periods. Now, let's turn to the financial overview. Let me first discuss income from operations. Income from operations for the fourth quarter was 210 million or 9.8% of revenue, up 163% from the prior year fourth quarter income from operations of 80 million or 3.8% of revenue. Adjusted operating income for the fourth quarter was 390 million or 18.2% of revenue up 5% from a prior year fourth quarter adjusted operating income of 370 million or 17.8% of revenue. Income from operations for the full year 2018 was 907 million or 10.5% of revenue, up 76% from the same period in the prior year of 516 million or 6.3% of revenue. Adjusted operating income for the full year of 2018 was 1.6 billion or 19.1% of revenue and up 9% as compared to the same period in the prior year in which adjusted operating income was 1.5 billion or 18.4% of revenue. Now let me turn to EPS or earnings per share. For the fourth quarter of 2018 and '17, our diluted EPS was $1.29 and $1.84 respectively. The year-over-year decline and diluted EPS was due to the inclusion of aforementioned one-time tax benefit in the comparable period, which was incurred in connection with the U.S. tax reform. For the fourth quarter of 2018, our adjusted EPS was…

Okay. Thanks, Mike, and now we'll take your questions.

[Operator Instructions] Our first question comes from the line of Kai Pan with Morgan Stanley. Your line is open.

My first question. Just want to make sure the $60 reduction in other income line for 2019, would that be just one-off as you guys going forward, the level of other income will be lower?

Yes, based on '19 that's we think, it's reasonable amount that we would think that would be a similar line item, but that kind of range Kai in terms of thinking about the number going forward.

And then, John for the organic growth guidance 4%, this year did 5%. Just wonder, if anything sort of in your mind that could be headwind into 2019?

Well, I think if you look, I think generally the industry as a whole is projecting growth around 4% and we're saying, we think, we'll grow as fast as our competitors if not faster. That's how we have look 4%. We did very well in 2019 and we expect to -- I mean in 2018, we expect to continue to build on that in 2019, nothing special that we built into that.

One more, it's just last one a larger picture question. Looking back last three years, you had $10.33 achieved over deliver your 10.10 target. So John looking next 2 years, you've extended your contracts for another 2 years through 2020. There are two part question. Number one is that, what will you be focusing on in the next 2 years? Number two, you have a new stock unit awards, are they tied to specific performance like 10th and targets for the past 2 years?

So, let me answer that first -- the second part of the question first. The new stock awards will -- the way we did one-time mega grant of the 3 years was special. And the particular set of metrics we used there was that -- we're focused more on just total shareholder return for the new awards. So over the next 2 years, I think the story of the last 3 years was really bringing the two firms together. We had some synergy goals we wanted to get in terms of revenue. We had some efficiency goals we wanted to get in terms of lowering our overall costs. We had some tax savings we wanted to get. I think we want to continue to press in all three of those areas. But I think even more what we want to focus on is bringing Willis Towers Watson together and getting the synergies across all of our operations. So as I said, in 2018, we grew as fast as our competitors are a little bit faster when we look on an organic basis against that. And we want to build off of that in 2019 and 2020. I just one of the things that from a financial perspective, one of the main focuses we're going to have is growing our free cash flow. And as Mike referenced in his remarks, we expect that for the short to medium term, we should be able to grow free cash flow by 15% a year. And that's one of the key new metrics we're focusing on.

Our next question comes from the line of Greg Peters with Raymond James. Your line is open.

I guess, John, just to build on your last answer when you're talking about free cash flow. I was hoping maybe you could spend a minute and sort of give us some of the components that you would expect near term and longer term to drive free cash flow growth because it's clearly growing at a faster cliff than your earnings per share guidance by suggest. And embedded in that, I'm curious if you could give us an update on some of the pieces of the puzzle like DSOs?

Well, yes. I think so. First of all, profit is something that we expect to be growing significantly over the years. And one of the things to notice is that, Mike referenced some of the headwind we have from lower pension income though what that means is, we actually are getting more free cash flow as a larger percentage of our profit that we're getting there. So, that's going to be helping us. We have no integration cost going forward. We're going to be focusing on our working capital. And we are -- we successfully lowered our DSOs this year, and we're going to continue to press on that in coming years, Greg.

And just to build on that answer. Can you talk about the balance between investing in your operations and extracting margin improvement? It seems like many of your peers are talking about investing in things like InsurTech and other initiatives to help drive improved efficiency, and of course that's an upfront expense?

Yes. I mean, we've actually referenced this on some of the calls over the last couple of years, but the single largest investments we have as a company are in InsurTech. We're continuing to push on this -- in this area and then others, we have a lot of work we do on that already. We consider ourselves one of the leaders in this area and it's going to continue to be an important part of what we do.

And my second question and the last question I have is just around the organic revenue guidance. And I was wondering if you could, and I know you don't want to get nail down to specific guidance by segment, but I'm wondering if you could give us a sense or the some sort of feel for how the different segments might perform in this upcoming year?

Well, I think one of the things that we feel much more confident in giving some overall guidance for the Company the further you break it down, the more likely it is to be. We just don't have as much visibility into less little. I think we feel pretty good about the guidance at the Company level. And that's why we're trying to stick to that. I would note though that all of our segments grew this year and we expect all of our segments to grow again next year.

Next question is from Shlomo Rosenbaum of Stifel. Your line is open.

I just want a couple of things, I just wanted to jump into, and Mike maybe you can just, give us just a little bit more detail on the pension stuff. I had to jump back and forth on the call, so I might have missed that. But the reason why you have this hit is because lower expected return on assets and that's something that we should expect and just to go forward basis. Is that correct?

Well, some of -- no if you look at -- we have obviously -- we have an extra actuary. And in actuarial services that we provide to many times, we obviously provide that to ourselves in terms of going through that determination is no secret in terms of some of the assets performance that happened last year in 2018. And that had a direct impact in terms of what the returns would be for us going forward and in calculating that actual evaluation. So really that's the direct piece of it.

Maybe I just make it, maybe just make a couple comments quickly on that, Shlomo. So first of all, markets tanked in December, so we just have a lot less pension assets at the end of December when we do the measurement. Interestingly enough during the same time, you might have thought that the interest rates would be going up, but in fact, they went the longer term rates just a little bit. So, our liabilities increased at the same time that our assets were going down. We are a mark-to-market company. So we don't smooth the assets. So if you look at companies that smooth the asset performance over the years, they can hit a little bit by some of the drop that we experienced in the fourth quarter, but they're offsetting that by maybe some increases from prior year. So, it's not as big a difference, the companies that mark-to-market see bigger differences year-to-year.

And the cash implications, this is nominal, it's very small.

So, it's really a fourth quarter of event that impacted that and we could see that turning around next year this year as well. The same way it went down this year could go up next year.

Let me just say, if we have measured the assets at the end of January, we would add a different results.

Okay, okay. And then on the free cash flow side, did you make the litigation settlement in 2018 or is that still coming in 2019?

That's still coming we hope in 2019.

And just one of the things that I'm looking at just by step back with a lot less integration impact and really, if you go ahead and peel out the fact that the pension stuff is non-cash. Seems to be having a little bit faster free cash flow growth and because the margin is underlying margin is continuing to expand, you're continuing to work on the working capital and went to business know? Without the cash cost from the integration, shouldn't you be getting faster growth in that, certainly in the near-term?

Well, I mean, one thing to keep in mind is that we do have, we are expecting to pay the 120 million, as you said in 2019. And so, we're not trying to -- we're not saying adjust for the 120 million. We're saying we'll get 15% minimum.

Minimum or plus. Minimum will be the 15% Shlomo.

So, 15% including the hit of 120 million.

Including the hit of 120 million. Yes.

Got it. Got it. And then is there if you could just talk a little holistically, the organic growth in the businesses as you said been basically in line to ahead of peers recently. Is there some any reason to expect any difference going forward? Do you feel comfortable with some of the changes that you need over the last several years in leadership and the trajectory of the brokerage business that you should be able to achieve then on a go forward basis?

Yes. I feel great about the -- I feel great about the leadership we have in place from the operating committee on down. I think we have terrific leaders across -- really across all of our segments and geographies. I'm very optimistic about what we can achieve and I think there's -- every year has its own issues that you have to deal with, but frankly in some way some of the hardest things are behind us.

Okay, great. If I could just squeeze a last one in, just on capital allocation, historically, the legacy Watson Wyatt and then Towers Watson business has always been very -- hit a conservative posture on debt, you wanted a lot of powder dry for acquisitions. Is it the way we should think about it going forward or should we expect the Company might step up some of their share repurchase activity?

Well, I think what we would be looking at is share repurchase. We looking at about $800 million or so that we should have available that we could use for acquisitions, if we found some really great acquisitions, we wanted to do. If we didn't do that, we'll repurchase shares.

Thank you. And our next question comes from the line of Mark Marcon with Baird. Your line is open.

I was wondering, if you can just talk about a couple of things. John, you had mentioned, one of the organizational goals on a go-forward basis is this to continue to improve the way that the organization works together. I'm wondering if you can just talk about some of the -- how you're viewing like the internal alignment, the incentives, the culture, what are some of the major goals that you have over the next two years that you would -- that could actually be observable from the outside or that people on the inside should certainly see in terms of a change in terms of the way of operating?

So, I think certainly from the inside, we'll see -- we -- as we go to market and this is particularly in the US in talking to some of our -- some of the large companies going to market with our integrated proposition has led to us penetrating, in particular the CRB market in companies that we traditionally have not worked for. I mean, just in the fourth quarter -- in the December November-December timeframe. We had a couple of the large organizations that we won the CRB work for. I think that, that integrated approach-and it couldn't have occurred without both the CRB and some of the other parts of the organization working together. So, I think we'll start to see that pay off. That will be more visible to people inside, but I think outside, you'll probably see it in continued growth in our large market in CRB, in North America in particular. I think we're increasingly seeing chances to work together between our insurance, consulting, and technology operation and reinsurance and those took off right away. Working together, increasingly we are seeing the tools and analytics that we have available from ICT, we're introducing them into CRB and bringing them together. And in response to an earlier question, I talked about in InsurTech -- a lot of what we do in ICT is really on the InsurTech forefront there and so we expect to see some of that coming in.

And then two more questions if I may. Just with regards to the segment growth, you mentioned the overall 4% organic revenue growth, maybe without being very specific about the specific expectations. Could you just talk about rank ordering from strongest to perhaps most modest in terms of what your revenue growth expectations are among the four major segments? And then also where are you investing the most and then the last question is from Mike. Just can you give a little bit more specific in terms of the DSOs and what the goal is there and how we should think about the EBITDA, the free cash flow conversion? Thank you.

Okay. Thanks Mark. So, let me start off and say, from the segments I think the earnings growth rate is actually reasonably consistent across -- all of the segments, I think BDA is a segment that we talked about -- we're having the great growth in the new enrollments. But, of course that's also a segment with when you're selling to retirees there there's a mortality element that you have to take into account too, so you lose some of your customers every year. And some of the premiums that we got when we first enrolled people only last for a certain number of years, so they fade off too. So, my point is I think BDA has been by far the fastest growing of our segments over the last couple of years; we'll see that more in the same pack I think with the rest of them. And at a broad brush, 30,000 foot level, they all look more like -- all look about the same as the Company overall. I think IRRs is the one that probably has the most volatility, within segments, we'll see things like health and benefits, which I think will be very fast growing, but then that could be offset by other parts. So, the 4% is probably not a bad thing to think about for all the segments. In terms of what did we -- excuse me?

Which one would you invest in the most?

So, yes. So, the ones we're investing in, I think -- we're investing in Health & Benefits that's an area that, as I said is incredibly fast growing. We are investing in IRR and in CRB also. And in lot of ways we're investing in IRR and CRB are through the -- some of the InsurTech or some of the ICT materials that we're doing. The two largest investments that we have in the Company are InsurTech around that Invesco that we announced last year and then also the AMX for the asset management exchange is an area we're investing in. So, those are some of the areas that we're investing in for big growth. I should also mention though there are areas that are -- that may not have large growth that it still pays for us to invest in to make sure that we can maintain our market share or to make sure that we can improve our efficiency and grow, and so retirement for example, would be a case like that where we continue to invest in that because it's a great business to be in.

Great. And then on the DSO question, I mean obviously you saw the improvement in working free cash flow that we commented on in our prepared remarks and we targeted five-day reduction last year and we're looking at similar number to continue to drive that kind of improvement going into this next year. So, as we said, really kind of focused on 15% or better in terms of free cash flow growth and that's what we're really targeting and obviously DSO is a big part of that in terms of really looking at working capital -- overall in working capital management.

And our next question comes from the line of Mark Hughes with SunTrust. Your line is open.

Yes. Thank you. Good morning. The CRB growth of 7% in North America seems like a very strong number. You had alluded to some new business wins that came through kind of an integrated approach. How much of that 7% would you -- was there any timing benefit there or could you quantify how much might have come through revenue synergies this quarter?

No, because we don't actually record them or break them down, so we don't even have that data that we can ascribe we've got this win because of synergies. We've got this win for a different reason. So, some of these -- these just happened to be big name companies, so there is some anecdotal evidence about that. But I would say there wasn't anything special about timing. We had -- I mean, one of the things I'd mention is we had a really good fourth quarter in 2017 and so our growth in this fourth quarter in 2018 was I think all the more impressive because it was off a strong quarter there. But, we had areas like construction, which is a traditional strength of ours that was very strong in the fourth quarter this year, but really, particularly in North America this wasn't across the board -- good result.

And then, the share repurchase activity, how should we think about the total share count in 2019? Are you just going to be repurchasing issued shares and so hold steady or you're going to make progress on reducing the share count?

I think as I said in response to, I think it was Shlomo's question or Mark's question about the $800 million, we expect to spend about $800 million. If we did no acquisitions, we would use the whole $800 million to repurchase shares that would probably -- that would lower the share count. If we do some acquisitions that could eat into that, so we expect that we would do at least half, if not more of that in a share repurchase though.

Our next question comes from Michael Zaremski with Credit Suisse. Your line is open.

I know there's been a lot of talk on free cash flow, but I apologize I'm going to come back to it again, given the -- I think expectations were for free cash flow to grow by closer to 25%. So, maybe you can kind of talk to the long-term goal of maybe CapEx as a percent of revenues, is that what's keeping free cash flow from growing further because you're looking at making more investments or is it maybe the -- I think you alluded to the interest rates declining at the end of the year and so, it's the pension contribution maybe both? If you can kind of talk to why the gap between free cash flow on operating income levels, this isn't closing as fast as people expected.

I don't think we had any guidance of 25% increase in free cash flow.

I just want to get your consensus sorry, on Bloomberg.

I don't know. We think 15% per year is a pretty good result. So...

In some years it will be much higher, in some years lower and we're excluding the view that there will be that settlement happening in 2019 is most likely -- I mean that, that will happen in 2019 on Stanford litigation that we have outstanding, obviously you see the integration costs go away and on top of that basic so five number and we see free cash flow growing at a minimum of 15%, if not greater, but some years will be higher, some years will be lower and so I think 15% is a pretty good target to have.

Okay, that's fair. My follow-up and last question is when you think about organic growth and margins for 2019, in past quarters, your results have sometimes been a little bit more volatile than peers, I know the new accounting was sometimes tough to digest, so I'm just curious are there any tough comps or nuanced seasonality you think we should be aware of as we tweak our models for 2019?

I don't think so. No.

Our next question is from Joseph Kinar with Goldman Sachs. Your line is open.

So question I guess on going back to free cash flow. Looking at the 15% or more guidance for 2019 in growth, I think you said that you still expect five -- extracting by five days of DSO in 2019, so I think that gets about $100 million, so would the remainder just be to the EBITDA growth, am I thinking about it correctly?

I mean, that's -- look at some combination of what -- we did not get into that specific.

We haven't broken it down that specifically.

Okay. But it is correct to think of the $100 million roughly of the 15% improvement coming from DSO improvement?

Yes. I mean, I think we had a similar kind of target last year and that's where we're putting a similar type of improvement. Last year, I mean, so that's a similar year-on-year kind of improvement and we had five days targeted out.

But again, we didn't break it down that specifically.

Okay. And do you think that improving of DSO by five days a year as -- should we expect that to start slowing down in the out years or is that a reasonable number to think about for the foreseeable future?

Yes. I still would just come back to that 15%, in terms of target and some combination of, of all those things profits, working capital management, managing -- how we manage overall cash flow. So, I mean, we're targeting 15% and a combination of all those.

Okay.

I mean, look, I think we do think we can continue to get DSO improvements in each of the coming years. They may not be as much in one-year as the other. But we are -- we do think eventually it will slow down as we get closer to what our goal is, but we think there is at least several more years of improvement we can get.

Okay. And then on EBITDA, I think in the past you had said that 25.5% was kind before for 2019, but then clearly you've had a little bit of a change in the other income now on the one hand, on the other hand I'm assuming you have a little more clarity on potential other drivers for EBITDA improvement. How should we think of EBITDA, guidance outlook thoughts for 2019?

Yes, we're really not giving guidance on EBITDA that's why we thought it was more appropriate to really focus on operating income, which really focuses on the operations overall and then improvement. So you really take out that pension volatility that we had touched on earlier in our comments.

But, if you think about that the adjusted operating margin was I think, it was 18.4% in 2017 and 19.1% for this year and we're saying we're going to be close to 20% for next year. So, we're expecting to continue to improve our margins significantly.

Okay. And one last quick one, the $60 million decrease in other income in 2019, that's compared to 2018's $250 million right, not the adjusted $283 million?

So just -- can you repeat the question back just to make sure I got it.

Sure. You're talking about a $60 million decrease in other income net in 2019. I just wanted to confirm that, that $60 million decrease is off of other income net of $250 million for full year 2018 not off of the adjusted other income of $283 income?

That's correct. You're correct.

Our next question is from Meyer Shields with KBW. Your line is open.

Great, thanks. So one quick modeling question, with regard to unallocated expenses, should the full year 2018 run rate of about $75 million a quarter, is that a good base next year?

Yes. I mean, we're really not giving any further guidance on that number. I mean really focused on operating income, in terms of the target number and really focused on those margin improvements that John mentioned earlier there is really the way we're thinking about it.

Okay, sure enough. I was hoping you could give us just some update on certainly reinsurance demand, whether we're talking about 1:1 renewals overall whether you're seeing a -- I'm sorry a notable change in demand for reinsurance among seasons?

Yes, I mean we have -- we are definitely seeing strong demand for reinsurance. Overall consistent with what we've seen in the marketplace, and so that business has been very strong for us and performed well.

Yes. And I think if you look at it, you'll see -- as our competitors are reporting too, I think everybody said reinsurance is stronger than it was -- last year there's some growth in that and we participated in that.

Thank you. Our next question comes from Elyse Greenspan with Wells Fargo. Your line is open.

I just have some follow-up questions, I guess mostly related to some of the topics you've addressed on but, are you guys going away from that free cash flow target that was 75% to 80% of adjusted EBITDA. And just looking at it on an annual growth level now or it's still the longer-term target if you continue to grow 15% a year, that you will get to that 75% to 80% level?

Yes, I think Elyse the reason we are focusing on the growth so much is a, we think that's probably more helpful to people. The problem with the 75% to 80% is that, it depends on what portion, say things like pension income are of your total income. And so, rather than adjust the target each year as the pension income fluctuates up or down, we just thought we'd focus on the growth, we thought that'd be more meaningful for market participants also.

Okay. And then, in terms of going back, we kind of really adjust the pension income impact, but you guys had pointed to really that 25.5% level, so is the right way to think about it for those of us that were thinking you would get to that EBITDA margin, which I know we're not talking about operating margin in 2019. Is it all that for -- if not for December, and the impact of the markets that the pension income would have gone the other direction and then we would still -- we will be talking about 25.5%. I think some folks are just trying to reconcile comments about the margin improvement that you guys gave last quarter on an EBITDA basis with the guidance laid out today?

Yes, I think that's a fair comment. I mean that's a fair conclusion.

Okay. And then on the unallocated expense line, that's pretty variable as well, ticked up in the fourth quarter, if you can just comment on what drove that? And then, in your guidance for 2019, are you assuming unallocated net as kind of flat on a year-over-year basis for every quarter?

Yes, I mean what you see in that unallocated line item is corporate costs that aren't allocated back to the business such as Brexit, just would be an example that we saw happen -- and activities happening in the fourth quarter GPD, all kinds of activities that were happening in terms of that improvement. And we're really not giving any guidance Elyse, as it relates to that line item going forward as we're really focused as I say, going forward on operating income and operating income improvement.

Okay, and then my last question on buybacks, so tying together some of the numbers you gave, it seems like there is $800 million in a bucket call for acquisitions/repurchases. Can you just talk about with your -- where your stock is trading, I would think that you would still want to put more dollars toward repurchase and how you kind of counterbalance that against what return deals might have to hit for you to take that bucket and use it toward M&A as opposed to buybacks?

Sure. I mean, look, every time, every time we look at the deal, one of the things we consider is, this is money that we could be using to buyback our own stock and we think our stock is attractively priced for those people buying it. And so, we think it's a good deal, right now. It's something we know more about. So, when we consider an acquisition, we probably have to have a somewhat higher expected return there, just given that we could go and purchase our own shares. We take that into account every time we look at it, a potential acquisition.

Okay, thank you for the colour.

And our next question is from Adam Klauber with William Blair. Your line is open.

On acquisitions, do you expect to be more aggressive that you have more cash and will there be more bolt-on or would you look at actually new areas to go into?

So I think, we would be -- let me answer it this way, historically both Willis and Towers Watson were active in looking at acquisitions and growing that way. And during the last three years, as we've been bringing together three companies Willis and Towers Watson and Gras Savoye, we've rightly had to focus our energies on that integration and not much at all on potential acquisitions. We feel that we're in a really good operating place right now and we can go back to our historical look at acquisitions. So, the reason I wanted to put it in is I want to be careful when I say we're aggressive. I don't think we're going to be out there and being super aggressive acquirers necessarily. But, we'll certainly be a lot more aggressive than we have been in the last three years and I think it will look like the, the pre-2016. So, that's how we feel about that. We think that there is a number of -- there are areas where there are capabilities that would be hard for us to build on our own and we should be looking for acquisitions there's always things like that we're looking at, but we'd be open to lots of different sized deals.

And just one more follow-up, as far as restructuring charges, how much cash went out the door in 2018 and what's your expectation in 2019?

Yes, so the cash that went out the door in 2018 was roughly $160 million and 2019 we're expecting zero.

Okay. So, that should be a plus free cash rate?

Yes. I think, just coming back though as we kind of touched on free cash flow. You got -- we're going to grow it at minimum 15% over the next year. You got -- most likely the settlement of Stanford will happen next year, you'll have that coming back into it. So, you know -- and we're looking at a baseline off the 605 free cash flow number, so that's in terms of thinking about it going forward, so...

Thank you.

Okay. Thanks everyone for joining us this morning and I look forward to seeing all of you in March.

Ladies and gentlemen, this does conclude the program. You may now disconnect. Everyone have a great day.