Well, thanks everyone for being here. It's my pleasure to have up next Carrier Global, David Gitlin, Chairman and CEO, and Patrick Goris, CFO. So thanks very much to both of you for being here. I think we'll head straight into questions. I think first off, maybe start with Viessmann, as that closed relatively recently, a very large transaction. Maybe help us understand, you know, sort of how did that business kind of close out the year? How has it started the current year? And you, you've given some sort of revenue growth outlook for it for the year ahead, any main assumptions? Sure. Well, first, Julian, thanks to you. Thanks to Barclays for having us back. Look, we could not be more excited about this Viessmann combination. You know, we, we never bought it because of what we thought was gonna happen either in December or January. Yeah. We looked at it and said, "There is an unambiguous transition in the European market to heat pumps." That premise will 100% continue. So you look at what the EU is saying, 55% reduction in greenhouse gas emissions by 2030, 90% by 2040, and they specifically call out heat pumps because there's no way to get to those targets without a transition. So the underlying premise of that transition remains 100% intact. What happened towards the end of last year is that as some of the legislation in places like Germany was being debated, it did have a dulling effect on new orders. But when we constructed the plan for this year, we were very purposeful about looking in a very sober way around what would the heat pump market do in each country. We did a country-by-country assessment. We then looked at, first, share gains, second, boiler sales, which we assume short share gains. We assume that boilers will be a little bit higher than what we initially had anticipated. Yep. Aftermarket, which is a little over 10% of the business, will be up double digits. We'll get a couple of% of price, some of which is Carrier carryover. We have high confidence around working with our installer channel partners that we will get that price piece. We'll get double-digit battery. We looked at PV, and then we did a country-by-country assessment. Mid-single-digit growth for us on the top line in Germany, double-digit in France and in, and in Poland. Poland's gonna have some pent-up demand because of the change of administration is gonna drive more sales this year. And Italy, we think, will be down. So we feel very good about the mid-single-digit numbers. It does require double-digit growth in the back half, because we said, the first quarter for us could be flat, could be down. Yeah You know, a little bit. We'll see what happens. But remember, their heating season starts, y ou know, it's kind of the opposite of our in North America, our air conditioning system, we're starting to build now in anticipation of the summer months. They are gonna be focused on subsidy applications, which can start in Germany at the end of this month. So there would be no real subsidy applications in January and February. They were high in December. We've seen increased activity on the web pages, which is pre-order activity. Yeah. We do need to see subsidy applications pick up a lot as we get into March, April. That will feed demand that gets into the critical months of September, October. So we feel very calibrated on the plan, and you know, if you looked at January you would not be surprised to see that the Heat Pump Association could say that in Germany, heat pump volume growth was down— Yeah And it could be down significantly. I will tell you that Viessmann sales for us in January were flat. So what happens is, either a competitor or an industry association says a number— Yeah And you get a whole bunch of inbound questions around what does this mean for Viessmann and the thing. Yeah. The Viessmann EBITDA for this year will be higher than we had in our base plan. Sales will be a little bit lower, but we feel calibrated on where we are. We are gonna pull forward cost synergies. When you think about the sort of price discipline in the market as the volume comes under pressure in certain products, in certain countries, and so forth, how does the overall sort of pricing environment at Viessmann Climate look for the year ahead? Well, remember that we compete on a country-by-country basis. The — Yeah The competitors in each country will vary. Yeah. And we also compete in the very premium end of the market. So when you get to a specific country and to specific competitors, we believe that we will be rational, and we believe that any rational player will be rational. So we also have a very unique channel because we can go to the direct installers. We are not looking, as maybe some of our peers are, is the amount of inventory that may be held by a wholesaler, one of ten brands, and they have to start calibrating how do they drive sales with a destocking issue. We feel very calibrated on the inventory that our installers have and the pricing approach that we have for this year. Perfect. And, on the point on sort of the, the boiler mix versus the, the heat pump mix, how does that play into the, you know, the, the EBITDA and the, the sort of profit margin profile of Viessmann? Well, the margins are very comparable, boilers. Yeah A nd heat pumps, and they're both high margin. Yep. Obviously, we sell heat pumps for something like 3x the price of a boiler, so it'll affect the top line. Yep. But apples to apples, the margin percentage is the same, but if it affects the top line, it'll affect the overall a bit. Oh, go ahead, Patrick. What What do you say? No, that's all right. And when you look at the, you know, the route to market, I think is something different at Viessmann Climate versus many of its peers in Europe. A lot of the peers, I think, have suffered much more from the sort of wholesaler destock. I guess a couple of questions. One is, you know, how do you feel about the, the inventory levels in the channel for, for Viessmann product today? And then also when you look at the industry levels, I guess they, they have some effect if competitors are just trying to dump product. How do you feel about sort of industry inventory levels? I think for Viessmann, and I would say now for our resi business, say in the United States, it's kind of back to normal. You know, we went through a phase coming out of COVID, coming into the supply chain challenges, that— Yeah We all had elevated backlogs. Now we're back to kind of business as usual. We, we feel very good about the inventory levels in the installer channels. So I think what some of the Viessmann peers will go through with the destocking, those that have inventory in the wholesalers. Yeah May see some of what we saw last year for resi business in the United States. We suffered from some of that. Yeah. The question I think that folks have for, say, our U.S. resi business is, did we take our medicine last year? We believe we did. Yeah. If you look at the number of splits sold in the United States, it used to hover in the mid-6.5 million range. We got as high as a little bit back in 2022 or so, just north of 8 million. Yeah. Last year was back to that 6.5. So now we're kind of growing off what would have been traditional levels, and there may be some players in Europe that have to go through some of that, which we went through last year, where our volumes in the United States were down in the high teens last year. They were down in the high 20s in the fourth quarter. Yeah. Some of that was very purposeful. Our number one objective for U.S. resi in the fourth quarter was end with inventory levels down in the mid-teens. We ended down 16% year-over-year. If we look at where we are today, it's actually a little bit even lower than that. So we feel very good. You know, I know one of our peers said yesterday, destocking could go into the second quarter. We happen to not see that. We may, they may be right, we might be wrong, but we think that destocking is kind of largely behind us over either now or over the next month or so. So now we're kind of both Viessmann and us, it's sort of back to that same phenomenon as back to basics. You know, what's, we feel calibrated on residential new construction. We feel calibrated on what we're gonna see with some people moving homes and some of that, add-on replacement business, and now we're back to true orders driving true growth without having an, unusually high backlog. When we look at that, you know, to your point, it's, it's, maybe more now about final demand, health of the consumer, consumer confidence, those types of things, not so much inventory adjustment. How are you kind of assessing that, you know, in the U.S., that you feel that the final demand is more sluggish, the resi sector than one year ago or, or pretty similar? And then I guess in Europe, it's hard to pull apart from the subsidies moving around, but any thoughts around that final demand piece in some of Viessmann's biggest countries? Well, I start with the premise, both in the U.S. and in Europe, it's fundamentally a replacement business. Yeah. You know, so in both, both locations, you're dealing with an 80% replacement business. So the unit fails, you know, in August, you're gonna replace it. In the United States in December, in Europe, you're gonna replace your heating system. Now, if you look at the new construction piece in the United States, it is good to see that for a single family, there does seem to be some more recent, pent-up demand there. We believe in the United States, there's 4 million too few homes in the United States, so you are gonna see some, increase over time on residential new construction. We have it kind of flattish this year. There's more pressure on the multifamily side. Mortgage rates, you know, as they go from kind of 8% to below 7%, we do think there's gonna be pent-up demand for people moving home, which drives air conditioning and heating sales as part of the new inspection of the new home. And then there's gonna be pent-up demand for replacements, because remember, our volume was down in the high teens last year. So we do think for a bunch of factors, there's gonna be some increased demand. Now, we're very sober about the fact that there's big populations in the United States and Europe with slowing economies and inflation that still hasn't completely— Yeah Gone away, that are under pressure. But we do, we haven't seen a huge mix down. We haven't seen people replacing parts rather than the entire system. And then we'll have to see about the new refrigerant as that starts to come in this year, the new units into next year. That provides some lift as well. Perfect. And on that point, on the refrigerants, kind of do you feel that most of what the industry needed or wanted to hear from the EPA has happened now? Is there still some gating factors, you know, holding distributors back from stocking activity? Any thoughts on that and next steps on the EPA? Well, the big one was this one-year window we got. Yep. You know, and that was, that was important and that was helpful, and we were glad to see that clarification. There's one more clarification that we are strongly, as an industry, encouraging the EPA, DOE to make, and that is that, that prevents, kind of a unintended loophole that you can replace the outdoor unit only with the R-410A unit. I don't think that was ever intended, and we're optimistic that that will, get resolved, but that is important that that get resolved. Perfect. And, and one thing we didn't touch on, just finishing off the Viessmann discussion, was the potential for revenue synergies, timing, scale, what types of products do you think that synergy could be most powerful? We're optimistic there. I would tell you, I think that we put in our model virtually zero. Yeah. But I think the reality could end up being hundreds of millions. And I usually think about it in three categories. The first and the sort of soonest is the sort of multi-brand, multi-channel. Us pushing air conditioning sales in Europe, which will increase, you know, Julian, you know, very small percentage, less than 20% of Europeans have air conditioning. So we see that as a growing market, and we could push the Carrier brand air conditioning or Toshiba or both through their channel. And then, of course, the heating as a secondary brand, probably Toshiba through the wholesale market and then Carrier through the Viessmann channel. That we see as a really good opportunity. We see an opportunity for Viessmann growth here in the United States. It's a phenomenal brand. We see the growth there in Asia. There's another category around just base innovation. Viessmann has great technology, for example, their One Base system, which allows for real-time problem resolution remotely. You can almost think of them as like a, a Tesla. So real-time software upgrades, real-time interaction with the end unit. They do a better job of that than we do, and we see, and we expand some of our remote prognostics, diagnostics, upgrading capabilities through a One Base-type application. And then the third is sort of system type integration, like HEMS, the Home Energy Management Systems. They're the only ones in the world that do it very well, between PV, battery, heat pump, and the digital overlay. Is that an opportunity for us in the United States and elsewhere? Yes. And then you look at district heating, which is gonna become bigger in places like Germany. We can do the chillers, of course, you know, the— Yeah The water-cooled chiller, and they can do the apartment transfer units, so we think there's some nice synergy there. Perfect. And then on the sort of capacity expansions by competitors in heat pumps, that's been something that people talked about for sort of two years now. Do you see the industry, I wouldn't guess, like, slow down that capacity, so you don't get this huge imbalance of supply, demand in the medium term? Yeah, I think— You know, your own capacity expansion plans in Europe, inclusive of this. Yeah, I think with capacity, you don't shut it off, like, overnight. Yeah. So I think if you have a facility that's, you know, halfway— Yep Constructed, you're gonna see it through. We have that with Viessmann. Viessmann's building, what I think will be the most state-of-the-art heat pump facility in the world, bar none, in Poland. I had Patrick and I had an opportunity to visit it, and it's, it's gonna be tremendously automated. It's gonna be complete state-of-the-art, from an inventory management movement perspective. It's gonna be truly benchmark, and we're gonna see that through, you know? Yep. It'll be done here, sometime this summer. Yeah. I do think everyone's gonna be very sober about how much capacity is needed in the system and making sure that they throttle back anything that would indicate some kind of overcapacity. Great. And then, you know, looking at your commercial HVAC business for a second, I think data center and education verticals have been very strong, the last two or three years, probably continuing. Any sense of kind of scale of, you know, how much of your commercial HVAC business is exposed to those two verticals? Double digits. You know, we've said that data centers is low double digits. And by the way, we're kind of in the first or second inning on data centers. And you know that as we go to GenAI, those chips produce 7x the heat that a traditional chip would produce. So the criticality of heat dissipation and new technologies to facilitate that data center growth is right in our wheelhouse. We're working on some very unique technologies. We already have some. We're working on some news. I know you asked one of our peers about liquid cooling, we do that as well. So we're working on some very interesting technologies. Data centers been strong, and it's, it's kind of going to remain strong as far as the eye can see, of course. And higher ed, K-12, there's still about, I think, something like $63 billion of extra funding to be spent on K-12, and it needs to be allocated here in the coming months. Yeah. So we think that continues. Healthcare continues to be strong. We'll watch, commercial real estate in a week, probably continues to be weak for a bit. But overall, orders have been great, and our sales output have been great for commercial HVAC. You know, we were up north of 20%, I think, in North America in the fourth quarter. Our orders in January were strong in the United States and Europe, so we already had a strong backlog for commercial HVAC, coming into the year, and the order rate has continued at, at high levels. Perfect. You got that push underway on the aftermarket front in commercial HVAC. Maybe just kind of any update on that, and the confidence in that aftermarket sort of growth continue. Go ahead, Patrick. Oh, yeah. Aftermarket continues to be strong, frankly, across the company, not just in commercial HVAC. We actually don't talk a lot about aftermarket in our transport refrigeration business. Mm-hmm. You may be aware we have about 1.8 million cooling units in the market today. We have about 100,000 now sea containers— Yeah A ttached with aftermarket outlets, paid subscriptions, where we can monitor the performance of these units, remotely. Again, helping our customers reduce downtime, reduce their energy costs, and providing better visibility to either the operators or the end customers. The overall aftermarket remains a key focus, I'd say the number one commercial focus across the company, across all of our businesses. The acquisition or the combination with Viessmann won't change that. Yes, we will call it divest or exits of the aftermarket business. But Viessmann today, its aftermarket sales represent about 13, 12, 13% or so of the total. Yeah. Again, we expect to see that grow at attractive rates. So our overall objective of aftermarket revenue growth, the recurring revenue nature of it, the asset light, the margin accretion of it, all remains really valid. And as I said, it's commercial priority number one across all of our businesses. When you look just sort of our overall sort of first quarter playing out, it sounds like, you know, you mentioned Viessmann holding up orders in commercial HVAC in the U.S. and growing strongly. Any other sort of things we should bear in mind for how current demand is trending, you know, U.S. resi HVAC, for example, or transport? Yeah. A lot of Q1 is about March. Yeah. And so, I know there was some maybe some anxiety what Viessmann sales would do. As David mentioned, Viessmann sales were flat in January. Yeah. Basically what we expected. Yeah. What's really going to determine the outlook of the quarter is March. That's where we stand at this point. There's no reason to change anything what we said on the earnings call. Yeah Back in early February. Perfect. You know, operating margins, you know, how should we think about with the new portfolio operating leverage or annual operating margin expansion implementing Carrier? The value creation framework we laid out at our Investor Day in 2022 was 6%-8% organic growth. Yeah. Operating margin expansion of 50 basis points or more, every year. And if you go back just, for example, what we did last year— Yeah O ur core incrementals or core earnings conversion, and by that, I exclude the impact of acquisitions, divestitures, and currency. Our core incrementals were 40%. Yeah. Our guide for this year and our margins expanded by about 80 basis points, excluding the consolidation impact of our Toshiba Carrier JV. If I look at our guides for this year, core earnings conversion into our guide of over 30%, and again, we are projecting 50-100 basis points of margin expansion. With a faster-growing portfolio post transformation, with continued opportunity to drive either cross synergies within recent climate solutions or just running a simpler company, we certainly would not expect anything less than that type of a margin expansion year going forward. On the divestments front, sort of what are the thoughts around that and some of the considerations around, you know, what exactly how inside what should be done with commercial resi fire, and when do you sort of make a decision or announcement on that part? Yeah. So, if you, if you look at the four divestitures of the exits we have in flight, we've announced two. We're quite pleased with the, with the expected net proceeds. Yeah. Our key focus is ensuring we close these as soon as we can and, of course, working with our partners, and that happens. That takes us then to the third exit, that's industrial fire. There, we expect to be in a position to announce a definitive agreement around the end of this quarter, the March quarter, and then that leaves residential and commercial fire. Given our key focus on ensuring that the first two, we exit these as soon as we can, and then, of course, industrial. Industrial and, I should say residential and commercial fire, we still expect exit that this calendar year. Yeah Either through a public market exit or through a sale. And if I look at all the exits, it really puts us in a position that by the end of the year, we don't need the exit of a residential commercial fire for that. We expect to be back to about 2x net leverage. That's one year earlier than what we expected back in April of last year. And it also basically is a strong hint towards our intention to resume share repurchase. And of course, the objective there is to repurchase as soon as possible. The equivalent shares issued to the Viessmann family is about 58 million, all of which, of course, within a strong credit rating, and we continue to target Baa2. Fantastic. On the sort of cash generation profile of Carrier, you know, once the transformation of the portfolio is complete, how should we think about, you know, free cash flow, margin rate or conversion rate? Yeah. I know you like to look at free cash flow as a% of sales. I think it's a really good metric, and we have consistently increased our free cash flow as% of net sales over the last 10 years, even though our free cash flow has had some unique headwinds with respect to larger than usual restructuring charges, as we did last year, and cash restructuring costs. But also last year, we had over $200 million of M&A-related fees, given all the exits that are happening. So free cash flow this year, the headline will be impacted because we have some large gains in some exits already announced. We will pay taxes associated with those large gains. If you disregard some of the free cash flow impact related to the large gains, the taxes thereon, or some of the additional M&A-related fees, we expect free cash flow to be up another 10% this year. And we would expect them to be at or above free cash flow at 100% of what we call reported net income that takes into account restructuring charges. So there, I think with the exits, a little bit of noise, but underlying continued improvement, double digits now, free cash flow percent of net sales, even though there are some headwinds there by this time. And we've seen a change in behavior there within our company because we have changed our incentive compensation plans just last year, a third on organic sales, a third on adjusted operating profit, and a third on free cash flow. And everyone has more than ever a big incentive on ensuring that working capital continues to improve, which it does. Mm. And then going forward, of course, it will be continued, a very high focus on free cash flow. Great. And where are we, small, clearly, but sort of on this KPI? It's knowing that right now, commercial HVAC is particularly strong, and we're benefiting from that. We have peers that have that as a higher percentage of their portfolio, so they benefit from that. Mm-hmm. We like balance. We like the fact that we are now the market leaders in what we think over the next 10 years will be the highest growth consistent market in HVAC-R globally, will be the residential heating market in Europe, and now we're market leaders. Will there be a bumpy quarter here and there as things reset? Yeah. For sure. Will there be hypergrowth over the coming decade and then beyond? Yes. So we like the fact that we have Toshiba better positioning us in Asia. We have Viessmann better positioning us in Europe. We like our commercial HVAC position. And we like the fact that we just announced the deal two days ago in Saudi Arabia, where they're gonna spend $5 billion on infrastructure spend between now and 2030. Mm-hmm. And we are. You know, we try to make ourselves synonymous with market leadership when you think about HVAC, and that's who the Saudis, for their HVAC partner, decided to partner with through Alat as the subsidiary of PIF. So we like how position, position we are, globally, and we feel that as market leaders, we feel good about that 6%-8%. And then you want to take market back? Capital deployment, short term, very clear. Debt paydown, followed by share repurchases, the equivalent of 58 million shares or so. Longer term, our priorities remain unchanged. Organic growth, inorganic growth, and there we focus on a free cash flow yield as a primary metric, then a growing and sustainable dividend, and we continue to target there about a 30% payout, and then followed by share repurchases. And given the free cash flow generation profile that we have, I think this leaves a tremendous amount of firepower for either acquisitions or share repurchases. At this point, we don't see the sizes of the Viessmann-type acquisitions. Yeah. That's not our focus now. Our focus is debt paydown in purchasing shares, and then we'll go from there. Great. Any last comments from David? No, I just, Julian, first, thanks to you again, and, we're excited. You know, we often say that we paint on a very blank canvas because we all know that sustainability is a mega trend. HVAC has to have a critical seat at the table, and as market leaders, we feel so poised to ride this wave for the coming decade. So we love the position that we have, and while we're transforming, I think our investors should be incredibly confident that we will be heads down and continue to execute. Great. And we'll just finish off quickly with the audience response survey questions. So please, grab those gray boxes. First question, sort of ownership levels of the stock today. A mix of overweight and nothing. Number two is sort of general disposition towards Carrier right now. Generally positive. The third question is around, go to number three, around sort of EPS growth, and again, this would be versus multi-industry peers, so very broad group. So generally above peers. The fourth question, yeah, this one is less sort of relevant for now, but excess cash uses. I have a guess. Yeah. Okay. Debt reduction. Next question is around valuation. So what PE on year one should Carrier trade at? Generally sort of 20-ish times. And then the last question is around what's the main sort of gating factor, you know, why doesn't someone own more of Carrier right now? Core growth. Interesting. That's a big question. Fantastic. Well, thank you, Julian. Appreciate it.