Hello and welcome to the Core & Main Q1 2025 Earnings Call. My name is Alex and I'll be coordinating the call today. If you'd like to ask a question at the end of the presentation, please press star followed by one on your telephone keypad. I'll now hand it over to Glenn Floyd, Director of Investor Relations. Please go ahead. Thank you. Good morning, everyone. This is Glenn Floyd, Director of Investor Relations for Core & Main. We are excited to have you join us this morning for our fiscal 2025 first quarter earnings call. I am joined today by Mark Witkowski, our Chief Executive Officer, and Robyn Bradbury, our Chief Financial Officer. Mark will begin today's call with a brief business update. Robyn will then discuss our financial results and fiscal 2025 outlook, followed by a Q&A session. We will conclude the call with Mark's closing remarks. Our press release, presentation, and the statements made during this call may include forward-looking statements. These statements are subject to risks and uncertainties that could cause actual results to differ materially from our expectations and projections. Such risks and uncertainties include the factors set forth in our earnings press release and in our filings with the Securities and Exchange Commission. We will also discuss certain non-GAAP financial measures, which we believe are useful in assessing the operating results of our business. A reconciliation of these measures can be found in our earnings press release and in the appendix of our investor presentation. Thank you for your interest in Core & Main. I will now turn the call over to Chief Executive Officer, Mark Witkowski. Thanks, Glenn. Good morning, everyone. Thank you for joining us today. We are proud to deliver another quarter of strong performance at Core & Main, highlighted by first quarter net sales of $1.9 billion and adjusted EBITDA of $224 million, both all-time highs for the first quarter. Achieving these results in a dynamic macroeconomic environment speaks to the resilience of our end markets, the strength of our business model, and most importantly, the commitment of our associates to advance reliable infrastructure with local service nationwide. Our strong local relationships, product and service breadth, and product expertise continue to differentiate us and enable long-term value for our customers and stakeholders. We are seeing steady growth in municipal construction activity, and funding from the Infrastructure Investment and Jobs Act continues to generate new opportunities for growth in our end markets. The pipeline of shovel-ready projects utilizing the funding, particularly water and wastewater treatment plants, transmission line replacements, and stormwater management initiatives, is expanding, giving us confidence in our near and long-term outlook for municipal construction. Residential lot development was resilient through the first quarter, and we were pleased with the activity we saw to start the year. We are beginning to see signs of softening in response to general economic conditions and affordability pressures. Specifically, we are hearing from some of our customers that developers are reducing footprints in an effort to manage their capital investments. Despite the short-term uncertainty surrounding residential development, the secular fundamentals underpinning the U.S. housing market are strong, and we continue to expect builders to keep building homes and a release of pent-up demand as interest rates moderate and affordability improves. Our diversified mix within the non-residential end market provided stability despite shifting dynamics across project types. We continue to see strong sales volumes into data center construction and positive trends for institutional buildings, multifamily housing, and road and bridge projects. In contrast, activity remains softer for commercial buildings, manufacturing, and warehousing. That said, we're encouraged by the level of bidding activity across our non-residential portfolio, and we believe our balanced exposure provides us an opportunity to outperform the broader market over time. Market volume growth in the first quarter was supplemented by robust share gains from the execution of our product, customer, and geographic expansion initiatives to deliver mid-single-digit organic sales growth. We drove 10% growth in meters and growth well into the double digits in our treatment plant and fusible high-density polyethylene offerings. This level of execution illustrates our ability to make the right investments in talent, the power of our scale, and our role in accelerating the adoption of new products in the industry. We saw sequential improvement in gross margins in the first quarter, driven by disciplined pricing and solid execution in our private label and sourcing efforts. The consistency of our gross margin reflects the value we deliver to our customers, and it reinforces the strength of our differentiated value proposition. While tariffs and trade restrictions between the U.S. and other countries are at the top of everyone's mind, the direct impact on Core & Main's supply chain to date has been minimal, as the majority of our products are domestically made. We are actively working with our suppliers to mitigate any supply chain disruption, and we have taken pricing actions to the extent necessary. The direct and indirect impacts of tariffs on the broader economy and on private construction specifically remain uncertain, and we are monitoring the environment closely. We continue to execute on our capital priorities, deploying approximately $58 million during the first quarter between organic capital investments, share repurchases, and debt service. Investing in the growth of the business continues to be our highest priority for capital allocation. Our acquisition pipeline is healthy, and we continue to evaluate several opportunities of various sizes. We are also committed to returning capital to shareholders, and in the first quarter, we bought back nearly 837,000 shares of our stock at an attractive valuation. Turning to page six of the presentation, I'll wrap up my prepared remarks with a discussion on the levers we have to drive growth and scale our capabilities over the long term. Each of our 370 branches strive to sell more products to more customers and generate more profit every day. We equip the field with data on their markets, their share wallet, and their profitability, and they bring us new opportunities for organic growth. Our operating model generates organic share gains by focusing on local service combined with a pay-for-performance culture that aligns with our business strategy. We have an ongoing process to collect and evaluate these ideas, culminating in our annual strategic plan. The strategic plan gives us clarity on which of the many great opportunities to pursue, whether they are organic, inorganic, or often a combination of both. We work to bring these opportunities to life as initiatives where we resource them for scale, and we measure them with a focus on profitability. Our product initiatives, including meters, fusible HDPE, treatment plant, storm drainage, and geosynthetics, have allowed us to grow faster than the market historically, and we expect they will continue to help drive market share gains in the future. The 10-year growth of these initiatives has been impressive, averaging 13% annually, and they are delivering almost $2.5 billion in combined annual net sales today. To compete effectively, having a strong physical presence and strong local relationships in every market we serve is critical. No one is better equipped to identify service gaps and local growth opportunities than our local teams. With our local expertise and our market intelligence, we have significantly expanded our footprint since becoming an independent company in 2017 through a series of greenfields and bolt-on acquisitions. Greenfields are a powerful way to expand geographically, and we are well positioned to do so given our talent pool, our scale, and the lessons learned from our past successes. They require minimal CapEx to open and operate, and each of the 20 greenfields we've opened since 2017 has generated positive operating income within the first two years. Together, they are now delivering nearly $300 million of annual net sales. Of course, none of this is possible without our people, which is why we continue to invest heavily in their growth and development. Our award-winning training program commercializes our go-to-market strategy, deepens industry expertise, and ensures our 600+ field sales reps, who average 14 years of experience, are equipped to drive profitable growth. Our associates learn from the best of the best on the job in our national training center through in-house subject matter experts and with virtual and online learning academies. Our learning team offers a wide range of sales, operations, product expertise, leadership, and safety training programs and courses. We also provide customized training and early career rotational programs for college graduates to develop as future leaders. We partner with our suppliers to enhance our knowledge base as new products and best practices are continually introduced in our industry. Our comprehensive approach and dedication to developing industry leaders earn Core & Main the number 23 spot on Training Magazine's Global APEX Awards list for excellence in employee training and development. Because strong local relationships are key to success in new markets, bolt-on acquisitions is often the fastest approach, and you can see that in our results. Since 2017, we've completed over 40 acquisitions, adding approximately 140 branches and $1.8 billion of annual net sales. We aren't done. With only a 19% share of a highly fragmented $39 billion addressable market, our long-term opportunities to grow and gain market share are significant. We've proven we can add substantial sales and profitability to our business through these initiatives. We add sustainable margin expansion to the mix through private label, sourcing optimization, pricing analytics, and digitization, and that is an exciting formula for profitable growth. Thank you all for your ongoing support and trust in our long-term vision. I look forward to what Core & Main will accomplish in the years ahead, and I'll now turn it over to Robyn to provide our financial update. Thank you, Mark. I want to start by thanking our teams for their hard work in delivering another record quarter. I'll begin on page eight with some highlights from our first quarter results. We grew net sales 10% to a first quarter record of $1.9 billion. Organic sales were up mid-single digits, and acquisitions contributed the balance of growth in the quarter. Pricing improved sequentially from the prior quarter, resulting in a neutral impact to sales growth compared to the prior year. Our end markets were slightly positive in total, and we believe we achieved considerable share gains from the execution of our product, customer, and geographic expansion initiatives. As mentioned on our last call, we estimate that approximately 85% of our sales are products that are domestically manufactured and distributed. For the balance of products that are imported by our suppliers or have imported components, there is usually a domestic alternative. While tariffs did not significantly impact our first quarter results, we are starting to see some tariff-related cost increases from our suppliers, and we expect to pass through these costs as we have done historically. Gross margins in the first quarter finished at 26.7% compared to 26.6% last quarter and 26.9% in the prior year. The sequential improvement in gross margin was driven by pricing discipline and continued execution of our private label and sourcing initiatives while achieving share gains. The year-over-year decline was expected and is due to a higher average cost of inventory this year compared to last year, partially offset by accretive acquisitions and the success of our initiatives. Selling, general and administrative expenses increased 14% in the first quarter to $293 million. The increase in SG&A is primarily due to the impact of acquisitions and inflation. Excluding the effect of acquisitions and equity-based compensation, SG&A expenses were up approximately 4%, reflecting underlying gains in productivity. Interest expense was $30 million compared with $34 million in the prior year. The decrease was primarily due to lower average borrowings under our ABL credit facility and a decrease in rates on our variable-rate debt. Provision for income taxes in the first quarter was $36 million compared with $33 million in the prior year, and our effective tax rates were 25.5% and 24.6%, respectively. Our effective tax rate this year reflects a more normalized ongoing rate, and the increase over the prior year was due to exchanges of partnership interest that increased the allocation of net income to Core & Main. Diluted earnings per share increased approximately 6% to $0.52. The increase in diluted EPS was due to an increase in net income and lower share counts following the share repurchase transactions we completed throughout fiscal years 2024 and 2025. First quarter adjusted EBITDA increased 3% to $224 million. Adjusted EBITDA margins declined 80 basis points to 11.7%, which was in line with our expectations. Moving to our balance sheet and cash flow, we ended the quarter with net debt of nearly $2.3 billion and net leverage of 2.4 times. Total liquidity was $1.1 billion, consisting primarily of availability under our ABL credit facility. We generated $77 million of operating cash flow, and we are pleased with this result in what has historically been a lower cash generation quarter for us. We continue to allocate our cash flow to priorities that we believe will result in growth or returns for shareholders. We deployed $39 million in the first quarter to repurchase 837,000 shares at an average price of $46.64 per share, finishing the quarter with $285 million remaining under our authorization. Investing in growth remains our top capital allocation priority, and our M&A pipeline is active. We are actively engaging with dozens of potential targets, and we are being prudent in our valuation to ensure they are the right cultural and strategic fit. Turning to our outlook, we are reaffirming our full-year guidance for net sales of $7.6 billion-$7.8 billion and adjusted EBITDA of $950 million-$1 billion. This reflects our continued expectation for adjusted EBITDA margins in the range of 12.5%-12.8%. We have good visibility into demand through the next quarter and expect to finish the first half strong, supported by healthy project activity and backlogs. That said, uncertainty associated with tariffs, inflation, and interest rates could impact customer sentiment and demand in the back half of the year. At a high level, we continue to expect our end markets to be roughly flat for the full year, stable in the near term, but with less clarity as we move into the second half. We offer a strong value proposition to the industry, and we are on track to achieve the 2-4 points of above-market volume growth we communicated last quarter by expanding our presence in under-penetrated geographies, driving product line expansion, and acquiring and developing new sales talent. Pricing improves sequentially, and we believe that the impact of sales growth for the full year will be neutral or better. We expect to improve gross margins for the full year through the execution of our private label, sourcing optimization, and pricing initiatives, and our first quarter results support this trend. While SG&A growth has been outpacing sales growth in recent quarters due to the impact of acquisitions, we have been pleased to see organic productivity gains and have commenced cost-add activities and expect them to drive improvements through the end of the year. These productivity improvements, combined with our expectation for gross margin expansion, reinforce our confidence in achieving adjusted EBITDA margins in the 12.5%-12.8% range for the year. In closing, I want to reiterate that our sector has strong fundamentals, and we have a proven strategy to continue strengthening Core & Main's leadership position. The long-term trends underlying our end markets are favorable, and our products and services play a critical role in advancing reliable infrastructure. We expect to outperform the market even as the broader economic environment evolves. Our business is well positioned to capitalize on opportunities for growth, and we remain committed to building on our track record of delivering value to shareholders. With that, let's open it up for questions. Thank you. As a reminder, if you'd like to ask a question, please press star followed by one on your telephone keypad. If you'd like to remove your question, you may press star followed by two. Please limit yourself to one question and one follow-up. Thank you. Our first question for today comes from Matthew Bouley of Barclays. The line's now open. Please go ahead. Hey, good morning, Mark and Robyn. Thank you guys for taking the questions. Actually, I wanted to start on the SG&A side. So, you know, Robyn, some helpful color there around how you're thinking about productivity there for the year. I think you said it was up 4%, ex-acquisitions and equity comp. I just wanted to kind of drill in a little bit, you know, Q2, second half. Is the implication that you would start to see leverage on the SG&A rate as soon as Q2 here? Also curious if there was anything additional unusual that you might call out in that SG&A expense this quarter. Thank you. Yeah, hey, good morning, Matt. Thanks for the question. You're right. When we look at the quarter from an organic standpoint, excluding, you know, some one-time items or add-backs, we were productive for the quarter. So we, you know, gained some productivity there during the quarter. Our overall rate was improved sequentially from the fourth quarter. In total, we're making some progress there on some of our SG&A initiatives. As we get into the second quarter, we're expecting to see more organic improvement in rate from a year-over-year basis. As we get into the total company, we'll anniversary some of those acquisitions. We have been working on some of those M&A synergies. Those are on track. We're really pleased with the execution. As we've noted before, it can take about 12 months to 18 months to get some of those SG&A synergies on the M&A side. As we go throughout the year, we're looking to see improved SG&A rate as we kind of go through each quarter on a year-over-year basis. We've made some investments in growth. We've seen some inflation. We're working on offsetting some of those. Feel good with where we're at. Feel like we're making some good progress here and happy to see the gains and leverage on the organic side. Okay. Got it. Thank you for that, Robyn. Then, just secondly, thinking about the top-line guide for the year. You know, obviously, as you pointed out in Q1, it seemed like you had some fairly substantial share gains. I think I heard you say that your inflation outlook is maybe turning to a little bit more positive than it was. Just kind of given the starting point, you know, given where we are here in the middle of Q2, just kind of wanted to get a sense on the level of conservatism you're building into the back half, especially given the comments you made around some uncertainty out there. Just kind of help us sort of put together the first half and second half from a, you know, end market and volume perspective. Thank you. Sure. Yeah, happy to. If we look at the market for the full year, we're expecting the market to be roughly flat, stronger in the first half of the year, and then, you know, down a little bit in the back half of the year from where we are today. That just reflects a level of uncertainty given, you know, tariffs, higher interest rates, and affordability concerns and things like that. Feel good, really good about our bidding and backlog activity and what we're seeing. We feel like it's going to be a good second quarter. You know, we'll see what happens in the back half with the macroeconomic environment. From a pricing standpoint, pricing has improved sequentially from the fourth quarter. We were down slightly in the fourth quarter. In the first quarter, we were roughly flat for pricing. We're expecting pricing to be flat for the year at a minimum. In the quarter, we saw some ins and outs on pricing in some product categories, but we're starting to anniversary some of the declines in the prior year and expect, you know, pricing to be roughly flat at worst for FY2025 overall. All right. Thank you, Robyn. Good luck, guys. Thanks, Matt. Thank you. Our next question comes from David Manley of Barclays. Your lines are now open. Please go ahead. Thank you. Good morning, everyone. Just to follow on that pricing question, could you just discuss the situation with commodities versus finished goods? I do not know if you said what it was in the quarter. Was pricing net zero, a little negative, and you expect that to improve through the remainder of the year? Just has there been any change in your thinking over the past 90 days as it relates to pricing? Yeah. Yeah. So we have seen pricing kind of improve sequentially from a year-over-year basis. Like I said, in the fourth quarter, we were slightly down. In the first quarter here, we were basically flattish from a year-over-year perspective. You know, from different product levels in the quarter, that steel has been improving. We did see that kind of anniversary and hit flat as we got to the end of the quarter. That was encouraging. PVC has been pretty stable over the last few months here. I have a good level of confidence for pricing to be flat as we go throughout the year based on some of those scenarios that we're seeing. You know, like I said, we've seen some down year-over-year for the quarter, but some of those are starting to normalize. We also have seen some inflation on other product categories, you know, and expect that to continue throughout the year. Flat to slightly up for the year is kind of the latest thinking there, Dave. Got it. Thank you. As it relates to your comments on the first half versus second half, I think the extra week was in the fourth quarter last year. Am I correct in saying that? You have one less week year-to-year in the fourth quarter this year. Even weeks adjusted, looking at sort of organic growth, it looks like the comps are maybe just a little bit tougher in the back half. You are talking about the market being uncertain, and that is what you are signaling, right? Or should we read a little bit into the fact that maybe there is some unusual movement in your own financials relative to those year-to-year comps? Yeah. Yeah, great question. So you're right. We've got the 53rd week in the fourth quarter of this year, or the lack thereof, I guess. That'll be about a two-point headwind for the year, given we'll have one less week, much higher impact on that quarter. If you think about seasonality for this year, you know, it's possible that the fourth quarter could be down on a year-over-year basis from total sales, just given that we have one less week in the quarter. The second quarter is shaping up good for us. We did have that wet weather in the prior year, you know, so expecting to see some good performance in the second quarter. And then we had a little bit of recoup of that wet weather in the third quarter. That'll be just a little bit tougher comp if you're thinking about seasonality and how to model that out. Thanks very much. Thanks, Dave. Thank you. Our next question comes from Nigel Coe of Wolfe Research. Your lines are now open. Please go ahead. Oh, thanks. Good morning, guys. Just wanted to maybe just go back to your comments, Robyn, about the SG&A, the equity comp portion. Just maybe just touch on whether that was related to the, you know, the CEO/CFO transition, or if there's anything else driving that. Then just kind of the follow-on to that question is, you know, the flat to 30 BPS of EBITDA margin expansion, are we still expecting that to be primarily gross margin driven with SG&A flat for the year? Yeah, Nigel, I'll touch on the stock equity comp first. Not really a big impact there from anything executive comp related. We did start to accrue that a little bit, but that really wasn't the impact. More of the impact on that was that we've now got three years of kind of post-IPO equity vested there. So what you're seeing now is a little bit more of a more normalized run rate going forward on the stock comp piece. Then the full-year framework. Hey, Nigel. Yeah, sorry. Sorry, Mark. Yeah. No, sorry. Hey, Nigel. Good morning. Yeah, I would tell you on the EBITDA expansion, you know, and our expectations to continue to grow that. Obviously, you know, we've had a lot of really good execution from a gross margin expansion standpoint, both with private label, a lot of the sourcing optimization we've been doing, and, you know, the pricing optimization work. Continue to believe that's going to be a good lever and multiple levers there for expansion. You know, we did expect going into this year that SG&A, with some of the carryover from the acquisitions that we did, that had much higher gross margin percentages, just given some of the product mixes there, also carried some higher SG&A with them that we've continued to optimize. I do expect, as Robyn mentioned earlier, we'll get some of that, and I would say starting very soon here in the second quarter and into the rest of the year, which will be another good lever for us for EBITDA expansion. I would still wait more of it for the full year, you know, on the gross margin side. That's great. And then just on the, obviously, you know, really good working capital performance in what's normally a very weak one-Q. Inventory did build, I think, mid-teens, year-over-year, even Q over Q is quite a step up. So I'm wondering, was that intentional to, you know, to kind of get ahead of some of these supplier price increases? Any thoughts there? Yeah, Nigel, you know, the inventory builds really twofold. I think, one, it represented the confidence and the volume that we saw here in the first half of the year and, you know, going into the second quarter. And then, yeah, just given some of the uncertainty around tariffs, you know, we definitely took an opportunity to bring in some extra inventory to make sure, number one, that we had all that inventory available for our customers. And then, you know, obviously, to mitigate against some potential increases that we're seeing just come into the market. So really twofold, I think, you know, from an inventory build standpoint. That's great. Thanks, Mark. Thank you. Our next question comes from Collin Verron of Deutsche Bank. Your lines are now open. Please go ahead. Good morning. Thank you for taking my questions. I just wanted to talk about the residential construction market a little bit more. You called out the resiliency in the most recent quarter, that things are slowing down, it looks like. Can you put a little more color around that, what you think the slowdown looks like from a magnitude perspective as we move through the rest of the year and when that starts to hit your sales? Yeah, sure. Thanks for the question. You know, from a residential perspective, you know, recognize we do a lot of the lot development work there. I'd say going into 2025, we were not really expecting it to be a robust environment in 2025. You know, we definitely were pleased with the activity that we saw in the quarter. I'd say it, you know, kind of came in more neutral to start the year. You know, definitely some positivity in certain parts of the country that, you know, we are seeing some really good activity. As we kind of exited the first quarter and into the second quarter, we started to get a little bit more feedback from the field and certainly our customers that are doing a lot of that lot development work that we're starting to see some of the bidding, some of the jobs that are being awarded just scale down in size. That led us to believe, you know, we could start seeing a little bit of a headwind with residential. That was part of our rationale as we thought about the guide for the rest of the year, you know, just taking that from kind of a neutral to potentially down slightly as we work through 2025, just given all the, you know, information we're seeing in the field, plus, you know, some of the other uncertainty in the macro environment that, you know, I think has been well publicized in the media. Those are some of the factors there. I do not view it as really a significant driver for us, given that's only about 20% of the business, but, you know, something that we're really watching right now. Great. That is really helpful, Colin. Then just on the meter side, you guys called out 10% growth. Can you just talk about the level of growth you are expecting for that product category going forward and how you are thinking about the volume versus mix equation there with the smart meter adoption by the industry? Yeah, you know, the smart meter performance continues to be really strong. I would tell you the 10% growth in the quarter, you know, is also on top of a prior year quarter where we grew at 30%. So the two-year stack there has been really impressive. We continue to win large, significant meter contracts with the suppliers that we're partnered with from a meter standpoint. I'd say that is mostly volume gains. As you think about the nature of meter contracts are generally a little longer term in nature. So really good, just solid volume growth there. I do expect there'll probably be some price increases into that market based on what we're seeing, you know, with some of the tariff impacts. Overall, we just continue to see a lot of great opportunity there. We've invested a lot of technical resources there to continue to drive the adoption in some of the larger metropolitan areas that are, I would say, a little further behind just with their general adoption of smart meter technology. Very confident with how we're positioned there and expect we'll continue to take more share as we move forward. Great. Thank you for the color. Thank you. Our next question comes from Brian Biros of Thompson Research Group. Your lines are now open. Please go ahead. Hey, good morning. Thank you for taking my questions today. On the product breakout, I guess this quarter had, I think, the best growth in storm drainage, and it was 17% compared to the total company at about 10%. And that's kind of played out over the past few quarters here where storm drainage outperformed company total. I guess, can you just talk about what's driving that outperformance there for storm drainage specifically? Is that acquisition that's growing? Is that company initiatives? Is that certain project types that are seeing better growth in the market? Any color there would be helpful. Yeah, thanks, Brian. For storm drainage, you're right. We've seen really good growth there. A portion of that has been M&A. A really good driver, though, of organic storm drainage growth for us has been specifically in the road and bridge area. We sell a lot of storm drainage product into that. Some of that has been kind of lifted by the infrastructure bill funding there. There's a good amount out there spreading around related to that road and bridge and street work. That has been a catalyst. We've been well positioned from the storm drainage standpoint. One other catalyst would be just the kind of shift in product type. You know, there are some areas that are now opening up and allowing more of the storm drainage product that we sell. There is more going through distribution on the storm drainage side versus historically, some of that has been some other product like concrete that has not typically gone as much through distribution. A lot of good dynamics there and expect that to continue to be a good growth driver for us as we move forward. Then maybe thinking, you know, much longer picture here, but can we maybe just talk about the 2028 targets that were set out in the prior investor day? I mean, because I'm thinking mainly the margin target, the 15% EBITDA margins. I think now it looks like you maybe need like 70 basis points of margin expansion per year to hit that number versus I think it was kind of 40-50 basis points per year at the time of the investor day and kind of the long-term annual value creation targets. Just trying to think, are there new levers or stronger levers to pull today to continue to progress to that 15% margin? Thank you. Yeah, sure. Thanks for the question. You know, as you think about the opportunity for us to expand EBITDA margin, the levers that we laid out during investor day, I'd say continue, and I'd say we continue to execute on those. Obviously, a lot of progress made from a gross margin standpoint. You know, given some of the M&A that we've completed, you know, really has provided, I'd say, even more opportunities for us to drive some more synergies and scale. I would say when we issued those targets during investor day, we also did expect, and I think we're very clear that there was some margin normalization that we expected to have happen early in the cycle there. It's not a surprise at all for us to know that, you know, we've got annual goals that are higher than that 30-50 basis points that we laid out there. I'm very confident, given the levers that we've laid out and we've continued to execute against, that we can achieve those goals. Great to hear. Thank you. Thank you. Our next question comes from Mike Dahl of RBC Capital Markets. Your lines are now open. Please go ahead. Morning. Thanks for taking my questions. A follow-up on price and gross margin. I guess if we're sitting here today and it sounds like commodities are basically back to roughly neutral, and you talked about some of the non-commodity price increases anecdotally. Can you just help ballpark kind of breadth and magnitude of the price increases that you're seeing your vendors put into the market and kind of timing of those? Because it seems like if commodities are flat and you're seeing some cost increases, that really we should be in more solidly inflationary territory for yourselves as we go through the year. That's the first part. Then maybe just type the sequential cadence in gross margins since you have the inventory position, but then there's moving pieces around some of these dynamics in terms of implementation and timing of price. Any dialing in you can help us with on sequential gross margin would help. Yeah, sure, Mike. You know, I'd just say generally, as we think about pricing and then the outlook, you know, obviously there's still a lot of uncertainty, you know, on the tariff side. I don't expect that will be a major driver for us, you know, and it should be kind of a neutral to positive. It's, you know, obviously been volatile and something we're going to watch as we go forward. I'd say, yeah, we're pleased with the sequential stability of the commodities. You know, we still do have a headwind with PVC on a year-over-year basis, but we have been pleased with how that's stabilized as we go forward. Do you expect, you know, just given some of the discussion with the, given some of the information that we've received from suppliers related to, you know, potential cost increases, that we've got an opportunity to get some inventory in like we have to be able to mitigate some of those cost increases. You know, we've really worked really hard with our suppliers and our customers to make sure that everybody is very, it's very transparent and clear where they're going to see potential price increases as we go forward. I'd say we're watching that closely. We believe neutral is kind of the right frame of mind. We've tried to indicate it could be positive if it keeps kind of trending in this direction as we go through the full year. You know, expect that we'll be able to get cost increases passed along such that, you know, gross margins are either held neutral or, you know, given some of the inventory investments that we could get a benefit out of that as we move throughout the year. Okay. Got it. Thanks for that color, Mark. Just as a follow-on, you spent some time talking about greenfields in the opening remarks, and the idea is not new that that is a lever, but it sounded like maybe that could be something that is of increasing focus for you as you have taken on the role. You know, 20 greenfields over the past seven, eight years, I think compared to some other distribution platforms across building products is still relatively modest. Maybe just help us understand what your vision is specifically on kind of the greenfield strategy and whether you could be leaning in on that. Yeah, sure, Mike. You know, what I would tell you on greenfields is just our general growth strategy is to have both levers as minutes to look at M&A and also having the opportunity to do greenfields in selected markets if that's a better opportunity for growth. If you go back through, you know, back to 2017 when we became a standalone company, obviously we've had some really strong M&A growth. We've added a lot of locations. We've integrated a lot of locations, and we've been able to complete greenfields during that time. I would tell you that there is definitely an emphasis on continuing to expand our business through greenfield locations. You know, while you know that annual average that you referenced, you know, may not sound like a lot, I can tell you that, you know, over the next year, I'd expect us to be opening, you know, somewhere between five and 10 new greenfields throughout 2025, just based on what we've got in the pipeline right now. I am very confident that, you know, given our focus in that area and evaluating whether M&A is the right strategy or greenfields, that we're going to continue to make really good progress there and really excited about what's in our pipeline there. That's great. Thank you. Yep. Thank you. Our next question comes from Anthony Pettinari of Citi. Your line is now open. Please go ahead. Good morning. For your municipal government customers, is it possible to kind of generalize as you talk with them how they're feeling about kind of the upcoming fiscal year and spending on, you know, your projects? You know, there's been kind of an effort by the administration to maybe peel back some funding for IRA or maybe some other programs that maybe could put some pressure on munis, but maybe there are parts of, you know, the current budget that could be more, you know, stimulus. I'm just wondering if you could talk about kind of the current policy environment and how your muni customers are kind of thinking about coming year. Hey, thanks, Anthony, for the question. You know, there's 50,000 municipalities in the U.S., so it's very fragmented, and we do spend some time with their annual budgets going through that. I would say, you know, funding for the municipalities is healthy. They've got multiple avenues that they can get funding for their projects. You know, the IIJA is starting to flow more. There's more of that flowing down to the municipalities today than there has been in the past. You know, there's state-level funding that's happening. There's some multi-billion dollar, you know, funding going out there at the state level for municipalities to gain funding to do some of these projects. At the local level, what we're seeing, though, is the majority of the spend that municipalities use for their water infrastructure is on their local revenue streams from the utility rates that they charge to their customers. Across the board, we feel like there's ample funding there for their projects for, you know, several years to come. Obviously, the water infrastructure is aged and in need of repair, but I feel like there's a lot of runway there for them to continue to work on projects. As we look at the guide and we look at the uncertainty in the back half of the year, municipality is not really in that bucket. Our municipal end market is pretty steady and stable and resilient from that standpoint. Got it. That's very helpful. Just following up on the question on greenfields and kind of organic versus inorganic, on the M&A side, are you seeing increased competition for deals? You know, it seems to be a lot of interest in building products, distribution, consolidation. I don't know if Waterworks is, you know, niche enough that you're not seeing, you know, a different kind of competitive environment for deals versus a few years ago. Just wonder if you kind of characterize the M&A market right now. Yeah, sure. Thanks for the question. You know, I would tell you no real changes from a competitive standpoint on the M&A side. I would tell you generally it can just be a little lumpier given, you know, when sellers are ready to sell businesses in our industry. It is a little bit more of a niche industry, I would say. You know, we've got a lot of really strong relationships across, you know, the Waterworks space and, you know, continue to be viewed as the acquirer of choice there, just given those long-standing relationships. I think the value that we've been able to demonstrate when we do these acquisitions and really making a good home for the associates and, you know, really helping them find new opportunities for growth and, you know, helping us create value. That continues to be a strong lever for us. I would tell you our pipeline, as Robyn mentioned on the call, is very healthy. We've got various deals that we're looking at at various stages and sizes right now and, you know, continue to expect that, you know, we'll continue to deliver on our growth strategy from an M&A standpoint. Okay. That's very helpful. I'll turn it over. Thank you. Our next question comes from Andrew Obin of Bank of America. The line is now open. Please go ahead. Hi, this is David Ridley -Lane for Andrew. Given some public commentary from your competitors, how has your own employee retention trended over the last 12 months? To put it, you know, bluntly, have you seen an uptick in poaching of your field sales representatives? Oh, thanks, David, for the question. I would tell you our retention of our associates remains extremely high. I would say it's, I would be confident in saying it's the best in the industry. We have always been in a position to retain our people. You know, from a, I'd say, a poaching standpoint, you can see that from time to time in the industry. It can come up. I would say we generally view that as a positive for us because we are generally able to take advantage of those situations and markets where that's happening in the industry. I wouldn't say it's any heavier or lighter than what we've ever seen historically and feel really good with the retention of our team and what we're delivering, you know, on an overall basis and, you know, continue to expect that to be the case as we go forward. Great. On the new cost-out initiatives that you announced on this earnings call, any rough quantification that you could give us in terms of how much you would expect to be realizing in the fiscal year? Just roughly. Hey, David. I would tell you that, you know, we've got kind of a lot of things going on there on the SG&A side. We are continuing to make investments in areas that have good opportunity for growth, making sure that those resources that we are, you know, adding are focused on the areas of growth. If there, you know, areas that maybe are a little bit underperforming, we can make shifts. We have done some of those things to make sure those resources are aligned to the best areas of opportunity. I would say, you know, not anything substantial at this point. We have been more focused on scaling some of the recent M&A that we've gotten and getting synergies that way on the SG&A front, and then just making sure our resources are appropriately deployed to the areas that get us the most opportunity. Those have been kind of the biggest areas of focus for us so far. Sorry, did I mishear that? I mean, when you were talking about the guidance and the guidance commentary, you said SG&A, some cost-out initiative started, right? I'm just making sure I heard. Yeah, we do have a little bit in underperforming areas. We do have a little bit of cost-out that we did, but, you know, that's part of my comments of aligning the resources to the areas of best opportunity. Okay. Thank you. Thanks. Thank you. At this time, we currently have no further questions. So I'll hand back to Mark Witkowski for any further remarks. Thank you all again for joining us today. It was a pleasure to have you on the call. I'd like to close by thanking our associates for continuing to provide exceptional service to our customers. We delivered another quarter of record performance driven by resilient demand, above-market growth, stable pricing, and sequential gross margin expansion. Our local relationships, diverse offerings, and investments in talent and new capabilities continue to differentiate Core & Main and drive market share gains. We are uniquely positioned to capitalize on the long-term secular drivers of water infrastructure investment, including aging systems, population growth, and increasing regulatory demands. Our scale, local expertise, and proven growth strategy enable us to deliver critical solutions that support the modernization and resilience of water systems nationwide. Thank you for your interest in Core & Main. Operator, that concludes our call. Thank you all for joining today's call. You may now disconnect your lines.