Good day, ladies and gentlemen, and welcome to the Baker Hughes company fourth quarter full year 2022 earnings 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. As a reminder, this conference call is being recorded. I'll now introduce your host for today's conference, Mr. Jud Bailey, Vice President of Investor Relations. Sir, you may begin. Thank you. Good morning, everyone, welcome to the Baker Hughes fourth quarter 2022 earnings conference call. Here with me are our Chairman and CEO, Lorenzo Simonelli, and our CFO, Nancy Buese. The earnings release we issued earlier today can be found on our website at bakerhughes.com. As a reminder, during the course of this conference call, we will provide forward-looking statements. These statements are not guarantees of future performance and involve a number of risks and assumptions. Please review our SEC filings and website for a discussion of the factors that could cause actual results to differ materially. As you know, reconciliations of operating income and other GAAP to non-GAAP measures can be found in our earnings release. With that, I will turn the call over to Lorenzo. Thank you, Jud. Good morning, everyone. Thanks for joining us. I'd like to start off by highlighting a couple of changes for this earnings call. For the first time, we are hosting our earnings call from Florence, Italy, where we will host our board meeting later this week and welcome over 2,000 customers and industry experts next week at our annual meeting. We will also be using a presentation during this webcast, which has also been published on our investor website that we will reference over the course of our prepared remarks. As you can see on slide four, we were very pleased to end 2022 with solid momentum across our two business segments. In the fourth quarter, we saw continued margin improvement in our OFSE segment and an extremely strong level of orders for IET, which was driven by multiple awards across different end markets. 2022 was an important year for Baker Hughes on a number of fronts. Strategically, we took a large step forward in reshaping the company as we announced our formal restructuring and resegmentation of Baker Hughes into two business segments. This kicked off a major transformation effort across the organization, including key executive management changes, which will fundamentally improve the way the company operates. Operationally, our performance for the year was mixed. During the first half of this year, we experienced multiple headwinds across our organization, as well as a number of operational challenges. While our performance improved over the second half, we still have more work to do and are focused on various initiatives to improve shorter-term execution and meet the longer-term financial objectives we laid out at an investor conference last September. Commercially, orders performance in LNG and new energy hit new highs and are poised to remain strong into 2023. In 2022, we booked almost $3.5 billion in LNG equipment orders, our highest ever, and booked over $400 million in new energy orders, showing over 50% growth versus 2021. Although not yet back to previous historical levels, orders for our offshore exposed businesses also accelerated. Within OFSE, SSPS booked over $3 billion in orders in 2022, representing 36% growth versus 2021. In IET, onshore-offshore production recorded equipment orders of almost $1.9 billion in 2022. We are also seeing improvements in our industrial segments with industrial technology orders of $3.3 billion in 2022, up 6% year-over-year. As we look ahead to 2023, we expect order momentum to continue across both OFSE and IET, despite what is likely to be a mixed macro environment. Turning to slide five, in 2023, the global economy is expected to experience some challenges under the weight of inflationary pressures and tightening monetary conditions. Despite recessionary pressures in some of the world's largest economies, we maintain a positive outlook for the energy sector. With years of under-investment now being amplified by recent geopolitical factors, global spare capacity for oil and gas has deteriorated and will likely require years of investment growth to meet forecasted future demand. For this reason, we continue to believe that we are in the early stages of a multi-year upturn in global activity and are poised to see a second consecutive year of solid double-digit increases in global upstream spending in 2023. In addition to strong growth in traditional oil and gas spending, we also believe that the Inflation Reduction Act in the U.S. and potential new legislation in Europe will support significant growth opportunities in new energy in 2023 and beyond. We also remain positive on the near-term and long-term prospects for the natural gas and LNG investment cycle. Near term, we believe that the likely reopening of China, combined with Europe's need to refill gas storage supplies, will play a critical role in keeping global gas and LNG markets tight. Longer term, we remain optimistic on the structural growth outlook for natural gas and LNG as the world looks to lower emissions and displace the consumption of coal. While cost inflation and higher interest rates slowed the pace of new LNG FIDs in 2022, we are seeing progress on a number of fronts. We continue to expect significant growth in new project sanctions in 2023, with elevated activity levels likely continuing into 2024. Following 36 MTPA of LNG FIDs in 2022, we continue to expect to see an additional 65-115 MTPA of LNG projects reach FID in 2023. Just as important as the near-term outlook for LNG orders, we are now gaining visibility into new project opportunities that are developing towards the middle of the decade. Most notably, we are seeing progress on a number of brownfield initiatives and advancements in our new modular concepts that is likely to extend the current wave of activity several more years. Turning to slide 6. Given this macro backdrop, Baker Hughes is intentionally focused on four key areas in 2023 in order to drive future value for shareholders. First, we are well-positioned to capitalize on the significant growth opportunities that are building across both business segments. These opportunities reach across the entire OFSE portfolio as well as in IET, most notably in LNG, onshore-offshore production, and new energy. Second, we remain focused on optimizing our corporate structure and transforming the Baker Hughes organization to drive improvements in our margin and returns profile. While we are still in the early stages of this process, we are increasingly confident in driving at least $150 million of cost out by the end of 2023, as well as structural changes that will simplify the organization and enhance our operational efficiency. The cost out and integration initiatives we are undertaking over the next 12-18 months will play a key role in hitting our EBITDA margin targets of 20% in OFSE and IET over the next 2-3 years, and delivering return on investment capital of 15% and 20% for OFSE and IET, respectively. Third, we continue to develop our portfolio of new energy technologies. We have been particularly active over the last few years acquiring and investing in multiple new technologies around hydrogen, carbon capture, clean power, and geothermal. We are now transitioning more towards the incubation of the existing portfolio. This will enable our new energy portfolio to achieve its full commercial potential, with a particular focus on high impact technologies like NET Power and Mosaic. Finally, we will continue to focus on all these initiatives and while also generating strong free cash flow and returning 60- 80% of this to shareholders through a combination of share buybacks and dividends. In 2022, we increased our dividends for the first time since 2017. Going forward, our goal is to continue to increase shareholder returns with an emphasis on continuing to grow the dividend as the IET business experiences broader structural growth in revenue and earnings. Turning to slide 7, I'll provide an update on each of our segments. In Oilfield Services & Equipment, the outlook remains promising, with growth trends shifting more in favor of international and offshore markets, while North America activity levels off. Importantly, the team continues to execute well as supply chain pressures moderate and the pricing e-environment remains favorable. Geographically, the Middle East retains the most promising outlook, with activity scheduled to increase in multiple countries this year and likely next year. In Latin America and West Africa, offshore activity is driving growth in several countries and creating opportunities across our diverse portfolio. In North America, visibility remains limited given the current oil and gas price environment, and generally expect range-bound activity from current levels over the course of 2023. Within our OFSE product lines, we have seen strong growth for well construction driven by opportunities across our drilling portfolio and for SIM, where our completions portfolio continues to see solid improvement. In production solutions, we saw strong volume growth and margin improvement in our chemicals business throughout the year as supply chain constraints continue to ease and profitability normalizes. For 2023, we expect further improvement in our chemicals business as margin levels normalize back to historical levels and our Singapore plant becomes fully operational. Our legacy OFS segment executed well in the fourth quarter, and we were pleased to see them achieve 19.6% EBITDA margins and 20% when normalizing for the impact of Russia. In SSPS, order activity remains strong as offshore activity continues to pick up. Importantly, we saw good order traction in both subsea trees and flexibles in the fourth quarter. After a record year in 2022 in flexibles orders, we expect another strong year in 2023, as well as a significant increase in subsea trees awards. We also continue to make progress on integrating SSPS into our OFSE segment, as well as restructuring the business to drive better profitability and returns. After a thorough review of the SSPS business, Maria Claudia and her team are finalizing plans to rationalize approximately 40-50% of the manufacturing capacity in subsea production systems. These steps will be in addition to the cost savings gained from removing management layers and will largely come into effect in 2024. For 2023, we expect OFSE to deliver double-digit revenue growth and solid improvements in margins as activity increases in multiple regions, inflationary pressures subside, and we execute our cost out program. Pricing remains favorable in most key markets. Moving to IET. The fourth quarter generated record orders driven by multiple awards in LNG and multiple awards in onshore/offshore production. Operationally, IET continues to navigate challenges in the Gas Technology Services, as well as challenges in different parts of the supply chain, ranging from chips and circuit boards to gas engines, castings, and forgings. Orders during the fourth quarter for gas technology illustrate the breadth and depth of its portfolio. In LNG, we saw continued progress across our world-class franchise. During the quarter, we were pleased to be awarded another major order to provide an LNG system for the second phase of Venture Global's Plaquemines project. This order builds on an award in the third quarter of 2022 for another power island system. This follows an award in the first quarter of 2022 for the first phase of Plaquemines and a similar contract for VG's Calcasieu Pass terminal in 2019, which are all part of a 70 mtpa master supply agreement. In onshore/offshore production, IET booked contracts for five different projects in Latin America and Sub-Saharan Africa worth almost $900 million on a combined basis. With these awards, IET maintains its leadership in the FPSO market by providing power generation systems, compression trains, and pumps that totals more than 30 aeroderivative gas turbines, 2 steam turbines, and 20 compressors of various sizes. On the new energy front, we were pleased to book an order from Malaysia Marine and Heavy Engineering to supply CO₂ compression equipment to PETRONAS's Kasawari offshore carbon capture and sequestration project in Sarawak, Malaysia. The project is expected to be the world's largest offshore CCS facility, with capacity to reduce CO₂ emissions by 3.3 mtpa. Baker Hughes will deliver two trains of low pressure booster compressors to enable CO₂ removal through membrane separation technology, as well as two trains for reinjecting the separated CO₂ into a dedicated storage site. Orders in our industrial technology business continued to perform well, with strong traction this quarter across inspection and pumps, valves, and gears. In our inspection business, we achieved significant commercial wins in the recovering aviation industry, including a record deal for visual inspection services in Latin America region, as well as a number of orders for advanced ultrasonic testing systems with different customers in Asia Pacific. In addition to solid growth in orders, we were pleased to see some signs of operational improvement in our industrial tech businesses, led by volume and margin increases in condition monitoring and inspection. We expect this positive momentum to continue into 2023 as the chip shortage and supply chain issues start to abate and backlog convertibility recovers. We enter 2023, IET has a record backlog of $25 billion and a robust pipeline of new order opportunities in LNG, onshore/offshore, and new energy. We now expect IET orders in 2023 between $10.5 -11.5 billion. Despite the supply chain challenges we are closely monitoring for both Gas Tech and Industrial Tech, we are well positioned to execute on this backlog to help drive significant revenue growth in 2023 and 2024. While 2022 presented some unique challenges to Baker Hughes, it was also a pivotal year for us strategically and accelerated a number of changes in the organization. As we look at 2023 and beyond, I feel confident in the structural changes we are executing and are positioning to capitalize on the multi-year upstream spending cycle, the unfolding wave of LNG investment, and the acceleration in new energy opportunities. Across our entire enterprise, Baker Hughes is focused on significantly improving our margins and financial returns and meeting our customers' needs in a quickly changing energy landscape. Achieving these goals will require acute focus across the entire organization, as well as the depth and scale of global resources and engineering talent. The culture of this company is unique in its diversity, its inclusiveness, and its principles, as well as its ability to adapt to change. Our team is focused on taking energy forward, transforming the way we operate, and achieving the margin and return targets we have laid out to help drive best-in-class shareholder value and returns. With that, I'll turn the call over to Nancy. Thanks, Lorenzo. I will begin on slide nine with an overview of total company results and then discuss our balance sheet, free cash flow, and capital allocation before then moving into the business segment details and our forward outlook. Total company orders for the quarter were $8 billion, up 32% sequentially, driven by Industrial & Energy Technology, up 82% versus the prior quarter. Oilfield Services & Equipment orders were flat sequentially. Year-over-year, orders were up 20%, driven by an increase in both segments. We're extremely pleased with the orders performance at IET during the quarter, following strong orders throughout 2022. Total company orders for the full year were $26.8 billion, an increase of 24% versus 2021. Remaining performance obligation was $27.8 billion, up 13% sequentially. OFSE RPO ended at $2.6 billion, up 8% sequentially, while IET RPO ended at $25.3 billion, up 13% sequentially. Our total company book-to-bill ratio in the quarter was 1.4, and IET was 1.8. Total company book-to-bill for the year was 1.3, and IET was 1.6. Revenue for the quarter was $5.9 billion, up 10% sequentially and up 8% year-over-year, driven by increases in both segments. Operating income for the quarter was $663 million. Adjusted operating income was $692 million, which excludes $29 million of restructuring, impairment, and other charges. Adjusted operating income was up 38% sequentially and up 21% year-over-year. Our adjusted operating income rate for the quarter was 11.7%, up 240 basis points sequentially. year-over-year, our adjusted operating income rate was up 130 basis points. Adjusted EBITDA in the quarter was $947 million, up 25% sequentially and up 12% year-over-year. Adjusted EBITDA rate was 16%, up 190 basis points sequentially and up 70 basis points year-over-year. Corporate costs were $100 million in the quarter, driven by the realization of some of our corporate optimization efforts. For the first quarter, we expect corporate costs to be roughly flat compared to fourth quarter levels. Depreciation and amortization expense was $255 million in the quarter. For the first quarter, we expect D&A to remain flat with fourth quarter levels. Net interest expense was $64 million. Income tax expense in the quarter was $157 million. GAAP earnings per share was $0.18. Included in GAAP earnings per share were unrealized mark-to-market net losses and fair value for our investments in ADNOC Drilling and C3.ai of $89 million and $11 million, respectively. Included were $81 million of charges related to the termination of the Tax Matters Agreement with General Electric. These are all recorded in other non-operating loss. Adjusted earnings per share was $0.38. Turning to slide 10, we maintain a strong balance sheet with total debt of $6.7 billion and net debt of $4.2 billion, which is 1.4 times our trailing 12 months Adjusted EBITDA. We generated free cash flow in the quarter of $657 million, up $239 million sequentially, driven by higher Adjusted EBITDA and strong cash collections. For the first quarter, we expect free cash flow to decline sequentially, primarily driven by seasonality. We will continue to target 50% free cash flow conversion from Adjusted EBITDA on a through cycle basis, but expect 2023 to be in the low to mid 40% range. Turning to slide 11 in capital allocation. We increased our quarterly dividend by $0.01 to $0.19 per share during the fourth quarter and also repurchased 4.2 million Class A shares for $101 million at an average price of $24 per share. For the full year 2022, we returned a total of $1.6 billion to shareholders. During the quarter, we closed the recently announced acquisition of BRUSH Power Generation, Quest Integrity, and AccessESP. The total net cash paid for these three transactions was approximately $650 million. To fund these transactions, we took advantage of our strong balance sheet and used cash on hand. Baker Hughes remains committed to a flexible capital allocation policy that balances returning cash to shareholders and investing in growth opportunities. Our capital allocation philosophy starts with the priority of maintaining a strong balance sheet and targeting free cash flow conversion from Adjusted EBITDA in excess of 50% on a through cycle basis. This framework will enable Baker Hughes to return 60-80% of our free cash flow back to shareholders. This will also allow us to invest in bolt-on M&A opportunities that can complement the current IET and OFSE portfolios, as well as our efforts in new energy. As we look to return cash to shareholders, we will prioritize growing our regular dividend given the secular growth opportunities for IET and complementing this with opportunistic share repurchases. Now, I will walk you through the business segment results in more detail and give you our thoughts on outlook going forward. Starting with Oilfield Services & Equipment on slide 12. Orders in the quarter were $3.7 billion, flat sequentially. Subsea and Surface Pressure System orders were $738 million, up 45% year-over-year, driven by an increase in subsea tree awards across multiple regions. OFSE revenue in the quarter was $3.6 billion, up 5% sequentially, driven by increases across all product lines. International revenue was up 5% sequentially, driven by Latin America up 10% and Middle East Asia up 7%, offset by Europe, CIS, SSA down 2%. North America revenue increased 5% sequentially. Excluding SSPS, both international and North America revenue were up 5%. OFSE operating income in the quarter was $416 million, up 28% sequentially. Operating income rate was 11.6%, with margin rates increasing 210 basis points sequentially. OFSE EBITDA in the quarter was $614 million, up 16% sequentially. EBITDA margin rate was 17.1%, with margins increasing 160 basis points sequentially, driven by increased volume and price improvements, partially offset by cost inflation. Year-over-year, EBITDA margins were up 160 basis points. We are really pleased with the margin performance in OFSE, particularly in the legacy OFS segment, which achieved a 19.6% EBITDA margin in the fourth quarter. Legacy OFS EBITDA margins were 20%, excluding underabsorbed costs incurred prior to the completion of the sale of OFS Russia to local management in November. Turning to slide 13. IET orders were at $4.3 billion, up 20% year-over-year and a record orders quarter for IET. The strong fourth quarter orders performance closed out a great 2022 for IET with $12.7 billion of orders, up 28% year-over-year. Gas Technology Equipment orders in the quarter were up 36% year-over-year. Gas Technology Equipment orders were supported by the LNG award for the second phase of Venture Global's Plaquemines project, a number of onshore-offshore production awards, and the award for CO₂ compression equipment for the Kasawari CCS project. Gas Technology Services orders in the quarter were down 4% year-over-year, driven by lower contractual services orders, partially offset by an increase in upgrades. RPO for IET ended at $25.3 billion, up 13% sequentially. Within IET RPO, Gas Technology Equipment RPO was $9.5 billion and Gas Technology Services RPO was $13.6 billion. Industrial Technology orders were up 6% year-over-year. Pumps, valves and gears, inspection, and PSI and controls orders were up year-over-year, offset by condition monitoring orders, which were down year-over-year. Turning to slide 14. Revenue for the quarter was $2.3 billion, up 1% versus the prior year. Gas Tech Equipment revenue was up 24% year-over-year, driven by the execution of project backlog. Gas Tech Services revenue was down 17% year-over-year, driven by lower contractual services and upgrades. This was primarily related to the loss of service revenue from the discontinuation of our Russia operations, foreign exchange movements, supply chain delays, and outage pushouts. As we've noted previously, the strength in commodity prices continues to shift maintenance schedules for some of our customers, a dynamic that we believe should normalize over time. Gas tech services also continues to see supply chain delays, largely stemming from delivery delays in aeroderivative gas turbines and associated components. This is an area that we will continue to monitor and manage going forward. Industrial technology revenue was flat year-over-year. condition monitoring, inspection, and PSI and controls revenue was up year-over-year, while PVG was down year-over-year. Operating income for IET was $377 million, down 5% year-over-year. Operating margin was 16.2%, down 110 basis points year-over-year. IET EBITDA was $429 million, down 4% year-over-year. EBITDA margin rate was 18.4%, down 110 basis points year-over-year, with higher equipment mix, cost inflation, and higher R&D spending, partially offset by higher pricing and slightly higher volume. As we increasingly execute on our record Gas Technology Equipment backlog, we are seeing a meaningful shift in the mix of our revenue profile, with equipment revenue representing 55% of total revenue in the quarter versus 45% a year ago. Turning to slide 15. I would like to update you on our outlook for the two business segments and our cost out program. With new reporting segments, we're providing a formal outlook in order to give another level of transparency for each business segment, as well as further details around our forward-looking expectations. As we transition to this new framework, we're providing a range of expectations and also highlight the variables that drive the different potential outcomes. Overall, we feel optimistic on the outlook for both OFSE and IET, with solid growth tailwinds across our business, as well as continued operational enhancements to help drive margin improvement. In addition to executing on the growing pipeline of commercial opportunities, a key focus for Baker Hughes in 2023 is transforming our organization through at least $150 million of annualized cost out by the end of this year. All necessary actions to achieve this target should be completed by the end of the 2nd quarter, and the full impact will be realized by the end of the 4th quarter. For Baker Hughes, we expect 1st quarter revenue between $5.3 billion and $5.7 billion and Adjusted EBITDA between $700 million and $760 million. For the full year, we expect revenue between $24 billion and $26 billion and Adjusted EBITDA between $3.6 billion and $3.8 billion. For OFSE, we expect first quarter results to reflect usual seasonal declines in international activity as well as typical seasonality in North America. We therefore expect first quarter revenue for OFSE between $3.3 billion and $3.5 billion and EBITDA between $515 million and $585 million. Factors driving this range include the magnitude of seasonality in some international markets, timing of budget deployments in the U.S., backlog conversion in SSPS, and the pace of our cost out initiatives. For the full year 2023, we expect another strong year of market growth internationally, spread across virtually all geographic regions, led by the Middle East, Latin America, and West Africa. Overall, we expect international D&C spending to likely increase in the middle double digits on a year-over-year basis. In North America, we expect activity levels to likely remain range-bound for the balance of the year, depending on oil and natural gas prices and activity levels among private operators. However, we believe that this level of activity, as well as cost inflation, will still translate into North America D&C spending growth in the mid to high double digits in 2023. Given this macro backdrop, we would expect OFSE revenue between $14.5 billion-$15.5 billion and EBITDA between $2.4 billion-$2.8 billion in 2023. Factors driving this range include the pace of growth in various international markets, a range of potential outcomes in North America activity, continued improvement in chemicals, the pace of backlog conversion and cost down initiatives in the SSPS segment, and our broader cost down initiatives. For IET, we expect strong revenue growth on a year-over-year basis, supported by backlog conversion at Gas Technology Equipment and modest growth in an industrial technology. We expect first quarter IET revenue between $1.9 billion and $2.4 billion and EBITDA between $250 million and $300 million. The major factors driving this revenue range will be the pace of backlog conversion for Gas Technology Equipment, growth in Industrial Tech driven by improving supply chain dynamics, and the impact of any continued deferrals in maintenance activity or supply chain delays at Gas Technology Services. For the full year, as Lorenzo mentioned, we now expect IET orders to be between $10.5 billion and $11.5 billion, driven by LNG and onshore offshore production. We forecast full year IET revenue between $9.5 billion and $10.5 billion and EBITDA between $1.35 billion and $1.65 billion. The largest factor driving this range will be the pace of backlog conversion for gas tech equipment and any impacts associated with supply chain delays. Other factors that drive this range include foreign currency movements, the pace of improvement in supply chain impacts at industrial tech, the level of R&D spend related to our new energy investments, and the timing of maintenance activity in gas tech services. With that, I will turn the call back over to Lorenzo. Thank you, Nancy. Turning to slide 16, Baker Hughes is committed to delivering for our customers and our shareholders. We remain focused on capitalizing on the growth opportunities across OFSE and IET, including LNG and new energy, where we are increasing R&D to develop our technology portfolio in hydrogen, carbon capture and clean power. We also remain committed to optimizing our corporate structure to enhance our margins and return profile, where we are targeting EBITDA margins of 20% in OFSE and IET and increasing ROIC in both businesses to 15% and 20% respectively. Finally, we will continue to focus on generating strong free cash flow and returning 60%-80% of this free cash flow to shareholders while also investing for growth across our world-class business. With that, I'll turn it back over to Jud. Thanks, Lorenzo. Operator, let's open the call for questions. Thank you. If you have a question at this time, please press star one one on your touch tone telephone. If your question has been answered or you wish to remove yourself from the queue, please press star one one again. We ask that you please limit yourself to one question and one related follow-up. Our first question comes from James West with Evercore ISI. Your line is open. Hey, good afternoon, Lorenzo and Nancy. Hi, James. Lorenzo, maybe first one for you, on the LNG side. When we were together in December, I know, as we were leaving, Jud was going to Houston, I was going to L.A., you were going to a Middle Eastern country that has some huge gas reserves and huge plans for LNG. I know you made some comments in your prepared remarks, but I'd love to get maybe some further comments on how you see kind of orders rolling in this year, given your dominant position in LNG. Yeah, James. Since that trip, I've also been back another two times, I can tell you the customer discussions have been, remaining and, there's a lot of positive momentum. I think both as you look at the near term and also the long-term prospects for natural gas and LNG, it's a positive investment cycle. You know, in, 2022, we did experience some cost inflation, some higher interest rates, which slowed the pace of FIDs, but conversations with customers definitely hasn't slowed down. I think you've seen some of the announcements also, within North America from Sempra related to Port Arthur... Sure. NextDecade, which has signed up a supply agreement. You know, importantly, I think the operators globally have recalibrated the project costs to the current environment, and they're actually starting to see success in securing some of the offtake agreements. I think there's a realization out there as well that natural gas and LNG are gonna play a key role, not just as transition, but also destination as the world continues to need more energy. We see a number of projects that are getting close to FID. We feel comfortable with at least 65 mtpa reaching FID this year and expect to see sanctioning activity actually exceed that. It's not just about 2023. I think as we look at the environment right now, we're actually going beyond and seeing also 2024 and also 2025 with the portfolio we have of modular approaches and a good time to be in LNG. Okay. Okay, got it. Then maybe, for Nancy, given your new role as CFO here, how are you thinking about capital allocation, and, you know, focusing on shareholder returns, et cetera, relative to. It's probably just the same, but relative to what Brian and Lorenzo were already focused on. Sure. Thanks, James. Baker Hughes remains committed to a flexible capital allocation policy, and as Lorenzo already mentioned, balancing returns to shareholders and also continuing to invest in growth opportunities. Our philosophy starts really with the priority of maintaining strong balance sheet and also targeting free cash flow conversion from us, Adjusted EBITDA in excess of 50% on a through cycle basis. This framework will allow us to return 60-80% of our free cash flow back to shareholders. also gives us the ability to invest in bolt-on M&A opportunities that'll complement the current IET and OFSE portfolios, as well as our efforts in new energy. As we look to return cash to shareholders, we will prioritize growing our regular dividend, given the secular growth opportunities for IET, and also complementing this with opportunistic share repurchases. Just as a reminder, during 2022, we did return a total of $1.6 billion to shareholders through both dividends and buybacks. Right. Okay. Well, great. Look forward to seeing both of you in Florence here in a few days. Thanks, James. Our next question comes from Scott Gruber with Citi. Your line is open. Yes, good morning. Nancy, Morning, Scott. I wanted to start on the free cash flow conversion rate from EBITDA this year. It, it does sound like, you know, working capital is probably a decent headwind this year. Is there more to working capital beyond just the top line growth? I also noticed the adjusted tax rate forecast in the guidance looks like for 35-40%, which sounds high. Can you also provide some color on the cash tax rate? Just some additional color on that free cash conversion rate. We do believe the free cash flow conversion potential should be around 50% through the cycle. In 2022, we saw a conversion below this range for a handful of items. Primarily, we had about $300 million-$400 million of cash generation that didn't materialize given the shutdown of the Russia operations. We also saw cash consumption from inventory build and OFSE and Gas Technology Equipment as we prepare for growth in 2023. We also had lower collections from some international customers during the year. As we think about 2023, we believe we should be in the low to mid 40% range with higher EBITDA, higher CapEx, but still about 4-5% of revenue. Cash taxes should be roughly the same as in 2022. Cash restructuring around $75 -100 million versus almost zero in 2022. Also for 2023, working capital will be a use of cash versus a modest source of cash, and that's another strong year of revenue growth in OFSE and Gas Technology Equipment. Hopefully that gives you a little bit of a picture. No, it does. Thank you. Just, you know, thinking about a couple unique items that impact, you know, EBITDA for the year. You know, I think you mentioned that the restructuring benefit is really going to kind of build over the course of the year and can hit more late. You know, some additional color there and just how to think about, you know, how much of the 150 cost out, you know, actually impacts EBITDA this year. Also, you know, we've seen a big swing in the euro here and, you know, the dollar starting to weaken across a number of other currencies. You know, just thoughts on, you know, the FX that's built into the guidance. I know the Euro weakness in the second half last year was impactful, just how did you guys think about that in terms of putting together the guidance for this year? On the cost out, we really put that program together last September and have identified a number of ways to remove costs from the organization and create a more efficient operating structure overall. I'd put the cost out efforts really in two categories. The first is cost reduction from structural changes in our organization, identified around simplifying and streamline operations from four product companies to two business segments and a leaner HQ. That's about two-thirds to three-quarters of the $150 million in cost out we're targeting. These also include headcount reductions from removing layers and really thinking about implementing a strategically managed business structure where we can push some activities down into the business from HQ and then do it on a more cost-efficient basis. The second bucket is really cost optimization or cost controls. Things, headcount reductions to optimize our support functions, and then also areas to optimize our cost and technology, third-party services, external expenses, those sorts of things. We should, in terms of timing, have all the process completed by the end of Q2 and all actions taken by the end of Q4 of this year, and then we should hit the annualized run rate sometime in the fourth quarter. Our plan today considers pretty conservative guides in terms of FX. Then the other piece on that is if the euro appreciates versus the USD, there could also be some upside to our revenue outlook for IET. Scott, just to give some more color, I think, on the cost out, you know, we've been operationalizing a lot of the actions since we made the announcement in September. We've got a dedicated team that's set up to go and execute this, and you've seen some of the changes we've made within Baker Hughes. I feel very good about the annualized run rate of the $150 coming through, and we'll see a lot of the actions in the first half of this year, which then will yield in the second half. Got it. I appreciate all the color. Thank you. Our next question comes from Chase Mulvehill with Bank of America. Your line is open. Hey, good afternoon, everyone. I guess, first question, if we can come back to kind of the order outlook for 2023, you know, for the IET segment. It looks like you kind of bumped up your order outlook by about 5%. The new guidance is about ten five, $10.5 billion to $11.5 billion. You know, you bumped up the orders despite having a really strong fourth quarter order. I would have thought maybe, you know, maybe pulled some orders into 2022, but just given that you raised your order outlook, probably, you know, means that you didn't really, you know, you don't think you kind of pulled any orders forward. When we think about 23, and the bump, like what was really driving the bump to orders in 23 and kind of, you know, when we think about that, obviously LNG is a big driver, but kind of walk through some of the drivers as well. Sure. Really, as with any year, there's a lot of moving pieces when we think about the orders, particularly with some of the large projects that are still out there. 2022, as you noted, was an exceptionally strong year for orders at for IET at $12.7 billion and a record 4Q at $4.2 billion. Broadly speaking, as we think about 2023, Gas Technology Equipment orders should be down versus 2022, primarily driven by onshore/offshore orders. As you know, ask about the drivers, 2022 was just a huge year for onshore/offshore. LNG orders are likely to be down modestly. The biggest driver though will be the onshore/offshore. We do think Gas Technology Services orders will be up modestly in 2023 versus 2022, with growth somewhat in line with 2022. Industrial tech orders will probably grow at a modestly slower pace than in 2022, and those were up about 6% in 2022. As you mentioned, overall, we now do expect IET orders to be in the ten and a half to eleven and a half billion dollar range for the year. I think, Chase. Appreciate it. Chase, as we go through it. I'm sorry, go ahead, Lorenzo. As we go through it, again, activity right now is pretty strong out there internationally. Again, we think, that 10.5 to 11.5 increase re-reflects the activity we're seeing. Awesome. All right, Lorenzo, maybe a quick follow-up here, you know, with new energy opportunities. Obviously a lot of color, you know, in the conference call and in the press release around CCUS, and hydrogen, and clean power as well. You know, we obviously got some legislation that's helping, you know, accelerate, you know, some of these markets. Talk about, you know, the outlook that you have and the opportunity for Baker, alongside some of these markets for 2023 and beyond. Yeah, sure. Chase, I'd firstly start by saying we're really pleased with the progress we made in 2022, which was a significant increase from 2021. As we look at 2023, again, we believe we can achieve around $400 million of new energy orders. You know, we're seeing the early stages of development within CCUS hydrogen. They are likely to be lumpy. As you said, there's been legislation that has come into place. The Inflation Reduction Act in the United States is helping to firm up that outlook. If anything, starting to pull forward some projects. We do anticipate that Europe may bring in some legislation to help spur the energy transition as we go forward. Over the next three to four years, the new energy content should be around 10% of our Gas Technology orders. As we stated previously, we believe by the end of the decade, new energy orders should be in the range of $6 billion-$7 billion. If you think about the middle of the decade, new energy representing about 10% of our Gas Technology orders and then accelerate through the balance of the second half of the decade. Direction of travel is clear. We've got the investments in place into the new tech and feel good about the way in which the market segment is really creating on the back of some of the legislation. All right. Good news. Thanks for the color. I'll turn it back over. Our next question comes from Arun Jayaram with JP Morgan. Your line is open. Good morning, good afternoon. My first question is on your IET EBITDA margin guide for 2023. Nancy, you posted a 16.8% EBITDA margin in 2022. The midpoint of the guide is 15%. I was wondering if you could walk through what's driving the margin change this year and then how you see margins, you know, moving towards that 20% 2025, 2026 guide over time? Yeah. If we look at the full year IET guidance, it would apply about a 200 basis points decline in margin rates from 2022. The real drivers around the equipment mix is it continues to move up and the step-up in R&D around our new energy efforts. On mix, you can see by our 2022 results and our 2023 guidance that equipment orders are going up. In 2022, Gas Tech revenue was 50% equipment, and this year it's likely to be 65% or higher. R&D, as we've been communicating, we're stepping up our effort there about $50 -75 million as we look to commercialize some of the most promising technologies that include things like NET Power and Mosaic. I think for the longer term, we would really reaffirm the margin levels that we previously indicated. Arun, just to add, I think we've maybe mentioned this before. You know, as we go through a big equipment build, it's actually a good thing for our business. Our installed base is increasing close to 30%, and then in the later years, we'll get the service calories associated with that. You know, it's a factor of the longer cycle nature of this business, but we feel confident in the next 2-3 years to be able to take the margin rate back up to, as we said, the 20% EBITDA rate, and that's driven by the services starting to come through after the equipment slowed through. Great. Thanks, Lorenzo. My follow-up is, Lorenzo, I believe you mentioned that the plan is to rationalize 40% or more of your subsea capacity. I was wondering if you'd provide more details on this plan and which markets do you plan or, you know, which markets will be focus markets on a go-forward basis for Baker? We did mention, you know, that we've been restructuring our SSPS business, and Maria Claudia and the team have been undergoing a strategic review. We are still in the early stages of that, as we look at the subsea tree capacity, we're really gonna be decreasing, rationalizing our production capacity by 40-50% and also outsource some of the basic machining. You can imagine from a cost perspective, we're in some relatively high-cost countries, it's an opportunity for us to be able to rationalize capacity back to, you know, Asia, also, Latin America, that machining was typically done in the U.K. We're continuing to look at how we go forward, and we feel good about the savings being achieved on top of the broader 150 cost out effort that included about $60 million from OFSE. Still early days, and we'll see this come through in 2024. But the team's got a good handle around, you know, how to take the strategy going forward for the SSPS business, and it's on the backdrop of an improving outlook for offshore. Great. Thanks a lot. Our next question comes from David Anderson with Barclays. Your line is open. Great. Thanks. Good morning. Lorenzo, just one question for me. You made a significant management change recently in the IET business. I was wondering if you could kind of talk about the management changes you made in there. You're bringing in someone from the outside in Ganesh and just kind of what you're trying to achieve with this change. Are there certain KPI targets you're targeting? Is there a new philosophy you're trying to instill in this part of the organization? It's obviously a big part of Baker Hughes. I'd just like to hear some more, some of your thoughts on that, please. Thank you. Yeah, sure, Dave. I think as we continue to evolve Baker Hughes, and as you saw from the announcement we made in September and moving to the two business segments, we continue to look at the future of how the growth of both the IET segment and OFSE is gonna take place. You know, in discussions with Rod and also how we're growing in the space of digital services, industrial and also climate technology solutions, it's not a one-year journey, it's a multiple year journey. Bringing in Ganesh was maybe sooner than anticipated, but we found a great talent that can help us drive the growth going forward. Comes from an experienced background of having built digital solutions at an enterprise level. Also knows well the climate technology solution space. If we look at where the growth is in the second half of the decade, we've set it around the new energy and also the industrial asset management. Great candidate at the right time. Rod is staying with us and helping with the transition, then he will be moving on. Very happy with the new structure. As you look at the changes we've made overall, it's all with the contemplation of, again, how we're moving forward for the next three years, the plan that we laid out in September and achieving the 20% EBITDA across the two segments. Great. Thank you, Lorenzo. Our next question comes from Marc Bianchi with Cowen. Your line is open. Hey. Thank you. I wanted to ask first about the guidance for first quarter in 2023. It seems to imply a steeper slope of improvement throughout the year than we typically see. I was curious if you could talk about your confidence in that progression and maybe how much traction we might see in the second quarter. Marc. Look, the confidence is there. I think what we've mentioned before is we've got a large equipment mix that flows through in the first quarter, and that's obviously impacting the EBITDA rate. As we go forward, we've got the backlog at hand, so the visibility is there. If you look at our RPO on the Gas Technology Services at $13.6 billion, we've got how that rolls out as well. I actually think this is pretty normal the way in which we are seeing the profile of the year just based on the way in which the equipment and the longer cycle projects are converting. We wanted to make sure that we gave that visibility, but feel confident with the outlook for the year and then also the cost out that's gonna be achieved with the $150 million transformation being annualized by the end of the year. Okay. Thanks, Lorenzo. Following up on the prior discussion around orders for 2023, Nancy, I think I heard you say that you expected LNG orders to be down year-over-year, the macro outlook that you guys have has a near doubling of LNG FID at the low end. Maybe you could. Kind of talk to that a little bit if you could. Maybe, again, it's an aspect of the lumpiness of the way some of the orders come through. I think as we go through this, again, the focus is on the total orders of the 10.5 and the 11.5, and the elements within there will shift. I think, again, as you look at LNG from the FIDs and the mtpa that's gonna be sanctioned, probably will be up versus 2022 and 2023. Okay. Thank you. I'll turn it back. Our next question comes from Connor Lynagh with Morgan Stanley. Your line is open. Yeah, thanks. I have sort of two related questions here, so I'll ask them at once. Basically within the, within the guidance for OFSE, you basically called out a couple of different swing factors that could affect the range or that are driving the range. I'm curious on one hand, you know, what are the big variables you're watching among the ones you called out? You know, you call out pace of growth. You call out chemicals improvement. A few others. Could you just sort of specify for us what you think is the most important? I guess, just in terms of the pace of growth, do you feel that, you know, third-party service providers that you don't have control over, customer activities, activity plans changing, or maybe something else would be sort of the biggest risk to achieving that? I can kind of walk you through some of the variables. The midpoint of the range assumes that the OFS business sees growth within the market fundamentals we've talked about with NAM, D&C growing to high double digits, international growing mid double digits, and then adjusting for our portfolio, really high concentration of production-related business lines in North America, higher concentration in the Middle East, and also the sale of OFS Russia. We assume SSPS generates strong double-digit revenue growth based on the backlog conversion. For margin rates, we assume 30+% incrementals as the chemical business continues to normalize, and we see some benefits from our cost out efforts. The high point of that range assumes significantly stronger growth in North America, driven by higher commodity prices and modestly stronger international growth. SSPS backlog conversion remains the same since it's already locked in, and incremental margins in the high 30% range. On the downside, I would say the low point assumes OFS North America revenue is essentially flat and international growth goes to low double-digit growth, and SSPS backlog conversion remains the same. Also really weaker incremental margins in the low 30% range. Understood. Then just in terms of, you know, where you see the largest potential bottlenecks, is that, you know, within Baker Hughes, is that third party service providers, or is that just whether or not customers wanna slow roll things based on the macro environment? Yeah, as you look at some of the external factors that we're monitoring, it really comes down to the supply chain associated with the IET. As you look at it, we mentioned that forgings, castings and some of the disruption you've heard about in the aerospace supply chain we're managing. We think we've got that in check, but we're obviously monitoring the component flow very closely. We are starting to see some improvement in the electronic chips, but monitoring that as well. Just something that we've gotta keep focus on and be aware that we're not the only users of some of these components. Understood. Thank you. All right. Well, look, thank you very much to everyone for taking the time to join our earnings call today. Look forward to speaking to you all soon and seeing some of you also in Florence in the next week. Operator, you may now close out the call. Thank you. Ladies and gentlemen, thank you for participating in today's conference. This concludes the program. You may all disconnect. Everyone, have a great day.