Greetings! Welcome to the Ecolab second q uarter 2024 e arnings release c onference c all. At this time, all participants are in listen-only mode. The question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero from your telephone keypad. As a reminder, this conference is being recorded. At this time, it's now my pleasure to introduce your host, Andy Hedberg, Vice President, Investor Relations. Thank you, Mr. Hedberg. You may now begin. Thank you, and hello, everyone, and welcome to Ecolab's second quarter conference call. With me today are Christophe Beck, Ecolab's Chairman and CEO, and Scott Kirkland, our CFO. A discussion of our results, along with our earnings release and the slides referencing the quarter results, are available on Ecolab's website at ecolab.com/investor. Please take a moment to read the cautionary statements in these materials, which state that this teleconference and the associated supplemental materials include estimates of future performance. These are forward-looking statements, and actual results could differ materially from those projected. Factors that could cause actual results to differ are described under the Risk Factors section in our most recent Form 10-K and in our posted materials. We also refer you to supplemental diluted earnings per share information in the release. With that, I'd like to turn the call over to Christophe Beck for his comments. Thank you, Andy, and welcome to everyone on the call. I'm happy to share my perspective before we jump into Q&A. But in summary, with 35% adjusted earnings growth in Q2 and 25%-29% earnings growth expected for the full year, I feel very good about where we are and even more where we're going. Ecolab's very strong business momentum continued in the second quarter. Our team delivered for our customers and delivered for our shareholders. Organic sales growth remained in its previously forecast 4%-5% range, as growth in our Institutional and Specialty segment normalized to a strong 7%, lapping last year's very strong 13%. Performance across the rest of our segments further improved. Our growth continues to be leveraged by exceptional organic operating income margin expansion. Margin increased by 360 basis points to 17%, which is a record second quarter margin for Ecolab, resulting in the very strong 35% growth in adjusted earnings per share. With continued top-line momentum and operating margins expanding towards our 20% target, we remain firmly on our long-term 12%-15% earnings growth trajectory. Looking at our segments, Institutional and Specialty continued to perform exceptionally well, delivering strong organic sales growth on top of last year's double-digit gains. Importantly, our business continues to significantly outperform softer restaurant foot traffic trends as our customers look to Ecolab's labor savings technologies to improve their operational performance. This growth was leveraged by continued robust operating income margin expansion, with Institutional and Specialty margin already exceeding 20%. Growth in our Industrial segment improved despite continued volatile end market demand. Water sales growth accelerated to 4%, led by strong growth in Downstream and double-digit growth in our Global High Tech business, which serves the rapidly expanding data center and microelectronic industries. As expected, sales in Food & B everage were stable as good new business wins offset comparisons to last year's double-digit growth. Performance in Paper improved also, a trend we expect to continue as new business wins help us accelerate as end markets stabilize. Our Healthcare and Life Sciences segment also showed better performance. Life Sciences growth improved to 4%, as attractive share gains allowed us to outperform ongoing short-term soft industry trends. We continue to expect modest growth in our Life Sciences business during the second half of the year. Healthcare sales were down modestly as we continue to exit low-margin business to improve our profitability. Our Healthcare transformation is progressing very well, and the previously announced sale of our Global Surgical Solutions business to Medline is moving exactly as expected. Subject to customary regulatory and closing conditions, we expect to close this transaction very soon. As discussed when we announced the sale last quarter, once closed, the transaction will reduce our Healthcare and Life Sciences quarterly sales by about $100 million and quarterly operating income by about $15 million. Longer term, Healthcare continues to sharpen its focus on its very healthy anchor instrument reprocessing business that combines consumables, personal service, and digital solutions. Well, in other words, a typical Ecolab business. While there is much more to be done, I'm proud of the progress we've made to create a sustainable, profitable Healthcare business that will deliver even stronger value for our important hospital customers. Pest Elimination, once again, continued to execute exceptionally well. Organic sales grew 9%, and organic operating income grew double digit, benefiting from our enterprise cross-selling strategy and innovative digital capabilities. As we continue our long-term growth journey, I'm excited to share details of our One Ecolab initiative, which will help fuel 5%-7% long-term organic sales growth and continue to expand our operating margins towards 20% and beyond. We know what best-in-class performance looks like, the best restaurants, the best hotels, or the best data centers, and we know how to deliver this for our customers because of our experience serving millions of locations in more than 170 countries across 40 industries. By leveraging more than 100,000 system connections and billions of proprietary data points on business outcomes, operational performance, and environmental impact, we can demonstrate how an entire network of customer sites can operate at best-in-class performance to deliver even more customer value. This will help us drive attractive growth by continuing to capture more share of our existing $55 billion cross-sell opportunity. At the same time, these new technologies will allow us to enhance the way we operate and serve our customers by realigning the functional work done across hundreds of offices around the world into major global centers of excellence. The resulting total annualized savings of approximately $140 million are expected to be realized by 2027. Put simply, One Ecolab will enable customers to reach best-in-class performance on all three fronts: business outcomes, operational performance, and environmental impact by leveraging Ecolab's complete offering. Looking to the balance of 2024, the confidence we have in our performance continues to strengthen. As a result, we are increasing our outlook for full year 2024 adjusted EPS to the range of $6.50-$6.70, up 25%-29% versus last year. As previously discussed, this range includes an unfavorable impact in the second half of 2024 from the sale of our Global Surgical Solutions business. The unfavorable impact to 2024 adjusted EPS is now estimated to be $0.08 a share, which is a bit more than we had previously anticipated, as we expect this transaction to close very soon. This is very good news, but it also has a bigger impact on the full year. FX, on the other hand, has also become more of a headwind and is now anticipated to be about $0.09 drag to full-year EPS. Despite these incremental headwinds to EPS, we still have increased our guidance range, which demonstrates the strong underlying momentum we have in the business. We expect to keep growing our organic sales at a similar rate as in the first half of the year, driving 2%-3% value pricing and 1%-2% volume growth. Attractive operating income margin expansion is expected to continue in the second half of 2024, though the rate of exceptional expansion will moderate as benefits from lowered delivered product cost will continue to ease. Finally, we continue to anticipate quarterly adjusted diluted earnings per share growth to progressively normalize towards Ecolab's long-term 12%-15% target. As solid growth continues, an impact from delivered product costs are expected to normalize, exiting 2024. As always, we'll remain good stewards of capital by continuing to invest in the business, increasing our dividend, and returning cash to shareholders. With great business momentum and cash flows, our balance sheet is in a very strong position. This provides us with many options to allocate capital to growth opportunities that will generate continued strong returns for shareholders. Ecolab's future has never looked brighter. Our leading customer value proposition, where our technologies help customers improve their operating performance while reducing their water and energy use, is increasingly relevant and continues to fuel our growth, pricing, and margin expansion. We therefore remain confident in delivering superior performance for our customers and shareholders in 2024 and beyond. Thank you for your continued support and investment in Ecolab. I look forward to your questions. Andy? Thanks, Christophe. That concludes our formal remarks. Operator, would you please begin the question and answer period? I thank you. We'll now be conducting our question and answer session. We ask you to please limit yourself to one question per caller, so others will have a chance to participate. If you'd like to ask a question, please press star one on your telephone keypad, and a confirmation tone will indicate your line is in the question queue. You may press star two if you'd like to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. One moment, please, while we poll for questions. Thank you. And our first question is from the line of Tim Mulrooney with William Blair. Please proceed with your question. Christophe, good afternoon. Good afternoon, Tim. So I wanted to dig into the Institutional segment a little bit here, which had really strong line margins in the second quarter, probably the strongest I've ever seen for the second quarter. I think margins typically peak in the third quarter, but I'm wondering if that's still the expectation this year, given what we saw in 2Q. And were there any one-time factors that helped moving here, you know, that we should be aware of for our models? And if I could sneak in a part two, just to touch on the growth side that you're seeing in the Institutional business right now, which looks really good. Just curious how you're thinking about the sustainability of that strong performance as you head into the second half of this year and into next year. Thank you. Hey, thanks for the question, Tim. Very pleased with the Institutional and Specialty segment. They're performing exceptionally well, as you've seen, as you know. So they're lapping against a 13% uplift growth in Q2 of 2023. So the 7% for this year is really strong, especially in a market where foot traffic is down 4%. So quite a remarkable performance. The margin that we had in Q2 were very clean for that segment, and as you know, it's a little bit seasonal, so by quarter. But generally, margins are gonna remain north of 20%. As we've said, for the full year, we should reach the 22% targeted OI margin for 2024 as a segment, and it will keep improving as well from there. Good upside, huge interest from customers, very clean, and from a margin perspective, very strong, and it's gonna keep improving as well in the next few quarters and years. So very pleased with what I&S is doing. Innovation is also adding a lot as well to the firepower of that business. As you know, our customers are all trying to find solution to manage labor shortages, wage growth as well that they have. They need more automation, they need more systems, they need more digital technology. This is exactly what we're providing our customers. So all in all, as I've shared with you many times, before the pandemic, for me, Institutional, so was kind of a steady, good business, for the future of Ecolab. Now, a few years later, I'm extremely bullish about that business because we're uniquely positioned so to gain a lot of share at very high margin. Thank you. The next question is from the line of Ashish Sabadra with RBC Capital Markets. Please proceed with your question. Thanks for taking my question. I just wanted to focus on the, the raw price dynamic. How should we think about the raw material tailwinds going into the back half of the year? And, we've continued to see pretty robust gross margin expansion, h ow should we think about the SG&A operating leverage going forward? Thanks. Thank you, Ashish. I'll pass that question to Scott. Yeah, Ashish, thanks for the question. Just answering your first question, as we think about the DPC, as Christophe talked up front, you know, we saw the favorability in Q2, high single digits. We're expecting that favorability to taper as we go into Q3, sort of call it low to mid single digits, and then by Q4, raws to get really stabilized as we think about them. And going into next year, frankly, we're seeing a world where raws get back to sort of normal inflationary levels next year. Certainly, given the amount of raws, the thousands of raw materials that we buy, they move around differently. In some cases, like caustic, you see favorability, but in other commodities, you're seeing them go the other direction, oil-based commodities in particular. And then as we think about the SG&A leverage, which, which are your two-part question, is, as we talked about last quarter, we are making really smart, growth-oriented investments, which is really driving, the line share, the increase in the second quarter, the, the 6% year-over-year. And those investments are in frontline firepower, technology, digital technology, which is all helping long-term productivity, and we feel very good about that underlying productivities. So in long term, we expect to get to at least those historical levels of productivity going forward. Our next question is from the line of Manav Patnaik with Barclays. Please proceed with your question. Hi, good afternoon. This is Ronan Kennedy. I'm on for Manav. Thank you for taking my question. With the One Ecolab initiative, I understand the long-term guidance framework unveiled at September 2023 Investor Day. I understand that contemplated SG&A productivity in addition to GM recovery, but to what extent did it consider this One Ecolab initiative and related benefits? Was it fully considered, or is it incremental? And what impact, you know, what's the impact on the targets, this trajectory, the timeline for realization, if any? Thank you, Ronnie. It's all gonna support, obviously, so our commitment, so to reach the 20% OI margin as quickly as we can. But most importantly, One Ecolab is a growth initiative. It's really so helping fuel towards the 5%-7%, which is the other commitment that we've made as well, which leads to this 12%-15% earnings per share growth. When you think about it, for One Ecolab, our company has anchored its strategy on Circle the Customer, C ircle the G lobe for a very long time. The opportunity is huge, $55 billion and close to $3 billion for our top 35 customers. Well, up to now, we had to rely, very successfully so, by the way, on our teams to work together in order to provide the whole value of Ecolab, so to our customers everywhere around the world, by working together, by reaching out, by working as one team. One Ecolab is, today, hardwiring all that, that ultimately, we can help our customers, take a restaurant chain, for instance, understand what's my best-in-class performance that I should be aiming at? Because we know what the best restaurant performance is out there, in terms of guest satisfaction, in terms of cost, in terms of environmental impact, and we can help them understand what's the total potential for their company, for their set of restaurants, and we will share that upside, so between us, as value price, and obviously, so, for the customer as a net-net positive for the customer. Well, that helps us grow, that helps us improve our margin, that helps our customers improve their performance. So it's a win-win that drives as well, retention or loyalty. So at the end of today, it's growth-focused, and at the same time, the technology that we're using, well, will help us reorganize the way we work, serving those customers as One Ecolab. That's gonna improve as well, the productivity. We've had so 20-30 basis points in the past of SG&A productivity growth. That's gonna improve as we go forward, as we implement, One Ecolab. But at the same time, as Scott was mentioning, so before, today, we also, reusing some of that margin, upside in order so to reinvest, in growth investment. All in all, that will help us, get to the 20% and go beyond by driving 5%-7%, top-line growth. Our next question comes from the line of John Roberts with Mizuho Securities. Please proceed with your question. Yeah, maybe just a further follow-up on that, Christophe. Sounds like you plan on creating centers of excellence. So what would the center of excellences be? And is the charge for severance for some of the functions that are gonna be replaced by the center of excellences? So John, I'll let it to Scott to reply to that question. But generally, we've been over the years always evolving the way we work, especially with all the technology capabilities that we have. So most of the investments, it's to shift from older technology to newer technology, to that new way of working, which ultimately is gonna help us grow faster and drive productivity. But bottom line, the good thing is that our team will keep strengthening as well in the meantime, so there will be no net negative for anyone in the organization. Was that Scott? Yeah, thanks, John. I'll add to that, Christophe. As you said, this is not about the restructuring, it's not about cost savings, this is focused on growth. The savings, honestly, John, are pretty immaterial in the context of the P&L. And if you think about this over a three-year program, the net sort of cost and savings are less than 1% on average over the next few years, really starting in 2025. But as we think about it, to your question on what the sort of nature of it is and what's happening, that is, it's not about cutting the jobs, but it's about realigning where the work gets done, moving work to these centers of excellence. Functional work, really, to support the growth, create scalability, to Christophe's earlier point, that helps drive incremental productivity from a long-term perspective. And then to your question on the charges, the special charges will include severance, as we move work, from many countries into these global COEs. But also there are other costs in there, including advisory costs, other costs, facility-related costs. But again, these are gonna happen over the next few years. Our next question comes from the line of Joshua Spector with UBS. Please receive your question. Yeah, hi, this is Lucas Beaumont on for Josh. So just looking at the second half assumptions, typically, like Ecolab will get a step up in EPS of sort of $0.25 or more, 2Q to 3Q. I mean, there's only been a couple of instances in the last 10 years where that didn't happen. So your guide's kind of assuming that it's only up kind of $0.12 to $0.20 at the high end. So firstly, I was wondering if you could just kind of walk us through why that normal seasonality doesn't make sense this year. And then secondly, the typical, like, 4Q move is, like, flat to down modestly, which is basically what you've assumed in your guide. So if we had a more typical 3Q move, and then we get the normal 4Q move, you'd be pointing more to, like, $6.80 for the year versus where you guys are at on the $6.60. So just trying to understand sort of what's different in the setup this year, please. Thanks. Thank you. I'll let Scott start, and I'll build on that. Yeah, feel free to add to this, Christophe. Obviously, a lot of move around. As Christophe talked, you know, in the second half, don't forget that we will have the impact of surgical, which will be a headwind, which we talked about, about $0.08, in addition to the additional headwinds that we'll see from FX. But overall, as you see this, the sales we expect to continue to accelerate throughout the year, right? And you typically see sales being higher in sort of the second and third quarter of the year. And then, on the other side of this, you'll see the year-over-year margin expansion will continue to expand, but it'll ease to the third quarter as DPC eases, and then DPC becomes sort of stable and ultimately a headwind next year. And so I think you have some dynamics here that are, you know, probably not gonna be able to compare the second half of this year to the normal years. But getting back to this is really the, if you look at our earnings growth, that we're gonna drive very strong earnings growth, and even excluding the DPC tailwinds we're getting at third quarter and then the stable DPC in the fourth quarter, that we're gonna be driving underlying EPS at the high end of our long-term 12%-15% range. Yeah, I feel really good about the second half here. When you think about it, so 35% earnings growth in Q2, 14%-20% expected in Q3, 12%-18% for Q4, with the midpoint of 15%, as Scott said, so with no DPC help as well at that point, including as well the impact of the surgical sale and FX as well, will demonstrate the strong business momentum and margin upwards momentum that we have as well here. So very consistent, very steady, feel really good about where we're going here. Next question is from the line of Chris Parkinson with Wolfe Research. Please just use your question. Great. Thank you so much. Christophe, we'd like to dig in a little bit more on Institutional and Specialty, just given kind of all the, the macro dynamics and your relative outperformance. But when you break down, you know, everything that's going on in quick service, including some of these, you know, perceived value wars and, obviously, the mechanics of food retail and then lodging in the Institutional side of it, you know, what's been driving, you know, the degree of material outperformance? And, you know, when we think about the second half into 2025, you know, does your team see actually any further improvements there, or is it gonna be primarily market share gains that's gonna drive the narrative for the foreseeable future? Thank you. Yeah. Thank you, Chris. It's mostly market share gain, as it's been as well, so the past few quarters. As mentioned, so the food traffic in restaurants in the U.S. is down 4%, so that's really showing how much we gaining share. The main driver in Institutional and Specialty of our performance is that we are helping our customers with labor automation. They don't find labor, and labor is expensive at the same time, and with a high turnover. Other than that, so it's pretty easy for our customers, so it's pretty hard, obviously. All our solutions that we provide them, being chemical solutions, helping doing three-in-one, or our new dish machine program, like the AI dish machine that we introduced, at— at the National Restaurant Association Show a few months ago. Our digital technologies, as well, are all helping our restaurant and hotels customers to serve more guests in a better way while using less labor. Well, this is exactly what they need, this is exactly what we're providing them, and it's exactly what competition can't really provide. So you put it all together, that drives growth at a higher margin because everybody wins. The next question is from the line of John McNulty with BMO Capital Markets. Please proceed with your question. Yeah, good afternoon. Thanks for taking my question. When you look at the Industrial business, you know, it looks like there—it's kind of a, there's a haves and have-nots, and you're seeing some decent growth in areas like Water. Food & Beverage, Paper still may be struggling a little bit. I guess, can you give us your outlook for the industrial markets as you're looking forward into the back half of the year and early next year, what you're hearing from your customers, especially on some of the areas that may be struggling, like the heavier water applications? Thank you, John. Generally, I like the progression that Industrial is having. So if you take a little bit the broader picture, the last few years, Industrial has done unbelievable work in terms of margin improvement. We've reached a record level as well, and the shift to offense, a year ago, that we started, is starting to bear fruit, as well, in terms of top line momentum, which is exactly where we want it to be. Getting top line moving while we keep improving, as well, the margins, and that's exactly what's happening. So we've moved, overall segments from 1% growth, in the first quarter to 2%, in the second quarter. Within that, as well, our largest business, which is Water, is at 4%, which, by the way, has been impacted as well by mining. So underlying Water would be even stronger, and the Downstream is really strong, in Water as well. Global High Tech is doing extremely well, as well, at the same time. So Industrial is shifting very nicely. When I think about F&B and Paper, they're gonna keep improving in the quarters to come. So bottom line, you will see Industrial shift even further up, with very strong margin of 16% today, which is 200 basis points better than where we were in 2019. So I think that we've really managed that very, very well, and the best is yet to come. Our next question is from the line of Jeff Zekauskas, JP Morgan. Please proceed with your question. Thanks very much. In the first quarter, your year-over-year volume growth was 2%, and this quarter, your year-over-year volume growth is 1%. Is the reason for the deceleration in volume growth in the Institutional business because of tougher comparisons? And secondly, do you have a target for your Global I ndustrial business? I know you want to get to a 20% margin, and that's the business that's maybe at, I don't know, 16.5%, something like that. Do you have a goal for that business? Thank you, Jeff. As mentioned just before, so I ndustrial is at 16% right now. It's 200 basis points better than what it was in 2019. And ultimately, so we want to have our Industrial move towards the 20% as well. Getting to 18% will be already a good step in that direction. And if we get Industrial to 18% and all the other businesses get to their target, we will get north of 20% as a whole company. So feel really good about both getting beyond the 20% as a whole company and 18% for Industrial, which is an unbelievable margin when you compare to competition. Now, your first question on volume, so from 2% to 1%, well, your comment was the answer. It's the gap between Q2 Institutional this year versus last year, which was 13%. That's bringing the 2% to 1%, so it's a year-on-year comparison. Other than that, all businesses, all segments that you've seen, have been improving as well in the meantime. So a year-on-year overall comparison and all businesses are improving very nicely, which is why I feel good about the business momentum. Our next question is from the line of David Begleiter with Deutsche Bank. Please proceed with your question. Thank you. Christophe, back onto the One Ecolab Initiative, do you need to make any additional investment, investments to support this initiative? And how should we think about the rollout and initial revenue drivers from this initiative? So, David, thank you. It's gonna be progressive. There is no revolution, that's to be expected here. A lot of groundwork has been done over the past few quarters, as well as we now get into execution mode. All the investments are planned in our numbers, as well here, so no surprise to be expected. So from that initiative, it's really an initiative that's helping us get towards this 5%-7% as quickly as we can. And I feel really good because we know that the $55 billion cross-sell opportunity that we have out there, and again, as mentioned before, out of the top 35 customers, we have $3 billion is available there. Well, this is easier to apply that we can get at a higher margin because obviously we're serving those customers already, so the cost to serve is much lower. So when you bring it all together, it's very organic, it's very natural. There's no revolution. It's what customers have been asking for years as well, what our teams are expecting as well, that when they go and serve a customer, well, they get the full picture of what we're doing for that customer today. At the same time, they understand what could be the best-in-class performance, how much additional value they could generate, what are the programs that they could sell to them as well, and then developing an execution plan for the customer to get there and ultimately, so get paid for it through the value pricing that we've been developing over the past few years. So bottom line, very organic, no incremental cost that we haven't included in the numbers as well in here. So I feel really good about where we're going with One Ecolab here. Our next question is from the line of Pavel Molchanov with Raymond James. Please proceed with your question. Thanks for taking the question. We haven't seen any M&A of late, you know, even on kind of a, you know, bite-sized or tuck-in scale. I'm curious how you're currently evaluating the acquisition pipeline. Thank you, Pavel. So I can't go in too much details, for obvious reasons, with M&A. We've done several smaller ones, over the last few years, following, obviously, the acquisition of Purolite, at the end of 2021. We wanted to make sure, we got that integration well done, that we got the right platform for the future, that we could get as well our leverage ratio. So back to 2x, that was our promise as well. We're getting there, as well as we speak, even more, obviously, so with the sale, our-- of our surgical solutions, business. So it's all done in a thoughtful manner, both from an execution perspective and from a financial perspective as well. What I can say is that, our M&A pipeline of, big and small, opportunities is very rich. We entertain all those connections on a regular basis as well. The fact that we have a great business performing extremely well with one of the strongest balance sheet that we've ever had puts us in a unique position, obviously, so to go after opportunities that we believe so would be the right ones for us. So what you've seen in the past is what you're gonna see in the future, but always focused on our three key priorities, as I've shared many times with you. First, it's gonna be Water. Second, it's gonna be Digital, and third, it's gonna be L ife Sciences. So those are gonna be the main areas where we're gonna be investing in M&A as well. Thank you. Our next question is from the line of Lawrence Alexander with Jefferies. Please proceed with your question. Hey, it's Dan Rizzo on for Lawrence. Just a little bit on the other side of the coin, you did a divestiture in the low margin Healthcare, and forgive me if you've said this in the past, but are there other businesses which you can look at where you might be exiting as well within that segment or within others? Not really. We obviously look at our portfolio on a regular basis and really think the way on who would be the best owner for that business. That's been true for a very, very long time. And the Surgical business was an obvious candidate because it is a product business. It's not a serviced business where we can apply the Ecolab model, where you have service, technology, chemistry, and data that come together. Surgical was purely drapes. Great drapes, obviously, but those are products. That's a business that fits very well in a Medline portfolio, much less in our own company. So that's one of the reasons why we've sold this business. At the same time, we wanna make sure that our Healthcare business can build from a smaller scale, a much healthier business for the future, and really focused on instrument reprocessing, which is a typical Ecolab business. Beyond that, there is no obvious business out there that doesn't fit the portfolio, that doesn't have the right performance. I like a lot the broad-based nature of the performance of the business across businesses and across markets. So in short, no obvious candidate out there to do something similar. The next question is from the line of Shlomo Rosenbaum with Stifel. Please proceed with your question. Hi, thank you. I thought I'd ask Scott to maybe dig a little bit deeper just on that volume question that was brought up before. Understand the mathematical implications of Institutional growth slowing, but you know, 'cause of the comps, how should we think of that in the second half of the year? You know, if you look at it, you on a total company volume, you grew 1% on a -1% last quarter. If you had 0% or flat volume in 3Q, does it make it tougher in order to generate the volume growth for the second half of the year? So just trying to get to, you know, how we should think of the volume growth going forward. And then if you don't mind, I just want to ask a housekeeping question. We saw a spike up sequentially in interest expense about $7 million, but the debt level was relatively the same. I don't know if there were some inter-quarter borrowing or there's something else that's included in that line? If you could just clarify that so we can straighten that out for our models. Yeah, I'll start with your last question first. If you just look at interest expense overall, year-over-year, you know, we had cash that we used to pay down debt earlier in the year, in the first quarter. So there's some impact from that as cash has come down from over $900 million at the end of 2023, to at the end of Q2, it's about $380 million. So that's probably the biggest driver as we look sequentially on interest expense. Expect interest expense in the second half to be in that, call it $60 million-$70 million range, which is inclusive of benefit we'll get from the Surgical proceeds, which is, as you've seen in the disclosure, the gross proceeds there are about $950 million. So, you know, back to your earlier volume question, which I think Christophe hit on exactly, which is, and to Jeff's earlier comment, is if we look at that sequentially, on the volume, it's really the impact of the comparisons to the Institutional volume coming down from Q1 to Q2 on the more difficult comps. And as we think about in the second half, you know, in that range that Christophe talked earlier in this 1%-2%. And maybe building on that, my commitments are to you has been, so to get to these 5%-7% as quickly as we can. 4%-5% this year, as I've said, so not every quarter is gonna be created equal, mostly because of year-on-year comparison. So 4%-5% this year, towards 5%-7%, doesn't seem to be like something crazy, especially with the momentum that we're showing in Industrial. So getting better, as mentioned, Pest remaining very strong, Institutional being in a very strong position, as well. When I see all the investments that we're making, as well out of the margins improvements that we have, with more feet on the street, with more capacities in growth businesses like Global High Tech, with, more capabilities in digital and innovation around the world as well, I feel good with the trajectory that we're having. Moving from this 4%- 5% to 5%- 7% is gonna happen so very naturally. Our next question is from the line of Steve Byrne with Bank of America. Please proceed with your question. Yes, thank you. I'd like to hear your view on two potentially meaningful longer term opportunities in Water. The first one being this initiative you talked about last year, where you're gonna be going after these, I don't know, what is it? 150 companies that consume 20% of global fresh water. Is that an initiative that still has you know, meaningful potential for you? And then the other one is with PFAS being classified as hazardous, that means every company that manages or uses it will have to report it in 2025 under TRI. Is that an initiative you are following? Thank you, Steve. So two parts, obviously very different components of your question here. So first, in terms of focusing on the 150 companies that use a third of the world's water, this is where we focus all our attention. And as mentioned before, so our laser focus on our top 35 customer, as a company, well, aligns perfectly well with that vision of those 150 companies using a third of the world's water. Those are the ones that are the more interested, obviously, in our technology, helping them produce more while reducing their cost, by reducing the usage of energy and water. This is working really well, which is one of the reasons why our Water business is doing well and keeps accelerating as well at the same time. Now, on the PFAS question, which is an old question, we have all the technologies to get that done the right way. Regulation is gonna help in a certain extent, where everyone so we'll have to play with the same rules. So we are really focusing on our customers today, helping them get plans on how to address that PFAS issue that turns into a business opportunity, so for us over time, and we focus mostly on Food & Beverage customers. Those are the ones who have the highest interest right now. I like the progress that we're making here, but it's gonna take some time to see it happen, or having an impact on our top line growth. At some point, it will. Our next question is from the line of Kevin McCarthy with Vertical Research. Please proceed with your question. Yes, thank you, and good afternoon, Christophe. My question relates to the potential timing attached to your long-standing EBIT margin goal of 20%. Would you expect to achieve that margin target coincident with the $140 million of savings from One Ecolab, or perhaps sooner than that or later? Appreciate that the macro environment obviously has something to say about the timing, but would certainly welcome any updated thoughts on that glide path and time frame. Thank you, Kevin. It was in September or October last year that I said that we will get there, so within a few years, and for sure, less than five. Well, we're almost a year later, so it's kind of the same, and a year closer to that. If anything, I feel more confident that we're gonna get there. We're gonna get there in time. There's no direct correlation between the One Ecolab savings and that margin, as Scott was saying before. We're talking about smaller numbers, this $140 million in the grand scheme of things. One Ecolab is mostly a growth initiative, which will help, obviously, on the SG&A, but most importantly, so we drive the margin, gross margin even higher, which will lead us to an OI improvement. So, I stick to where we were within the next few years, and we see the pieces coming very well together. Gross margin is already close to 44%, which was the high-water mark for our company, will keep improving from there. Our SG&A is 200 basis points below where it was, so pre-pandemic, as well in 2019, and will keep accelerating as well. Well, you bring all three together, nice top-line acceleration, gross margin, further improvements, and productivity improvements as well, will mathematically lead to the 20% fairly soon. Our next question is from the line of Patrick Cunningham with Citi. Please proceed with your question. Hi, thanks for taking my question. So on the Pest E limination business, the sales growth continues to be very strong, but the margin expansion is a bit more muted than the other segments. How should we think about the cadence of growth investments into that business and the timing on when we start to see some, you know, meaningful sales leverage? And just a follow-up there, is what sort of long-term margin target do you have for that business? Good question, Patrick. So, really love that business. Very steady growth, high single, low double. Really good. Not always an easy market, but whatever happens out there, it's always a very good performance. At the same time, it's the best performing, Pest Elimination business in the world, which is also a good indication. And as you know, there's no raw materials, almost none, related to that business, so there's no DPC help or hurt, obviously, on that business. It's a business that's gonna get north of 20%, for sure. And when I think about the main growth drivers here, there are two, mostly. The first one is to drive cross-sell, which has been at the core of our growth strategy in Pest E limination. So selling the P est E limination services to existing Ecolab customers worked really well over many, many years. And second, it's to invest in connected, devices. We have all the technology. We are one of the largest, industrial cloud, in the world. We have all sensing technology, we have all systems, we have all cybersecurity, everything that you need, ultimately, so to connect, all those millions of devices around the world, that today we go and visit, regularly each of them to check, whether you're gonna get activities or not. Well, tomorrow, that's gonna be very different. One data point, at the National Restaurant Association Show, we were in that big, conference hall, where you have 600 traps, in there. Today, we need roughly eight hours, to go and check all those traps. Tomorrow, it's gonna be done in 20 minutes. So just imagine, so how much value we can create, both in terms of growth, in terms of service to customers, and naturally, in terms of performance, that we can drive out of that business. So that's gonna drive top-line growth, it's gonna drive, earnings growth, and it's gonna drive return on invested capital, which is already the highest in our company, even further higher. Our next question is from the line of Andy Wittmann with Robert W. Baird. Please proceed with your question. Oh, great. Thanks for taking my question this afternoon. I guess I also wanted to ask on the One Ecolab plan, just because from the outside, it's hard to, I think, understand sometimes the difference between your various plans. I think over the years, I think back to, like, the 2018 efficiency initiative, you talked about some of the technology investments that you made enabled those changes then. You expanded that in 2019 and then again in 2020. The Institutional Advancement Program that you rolled out in 2023 was largely underpinned, I think, Christophe, about the digital investments that you made at that time as well. And then I think even the European program that you announced in 2023 also was kind of driven by digital. So this one I'm hearing again is going to be using technology to effectuate some of these efficiencies. But, I mean, can you just make a little bit finer point on kind of what's different about this one compared to some of the prior ones? So the main difference, Andy, is, the prior ones were by individual business. It was so to really improve, the delivery and the performance, of, Institutional. From a growth perspective, you've seen the results. That's why it's working so well today. It's not the only reason. Obviously, we talked about innovation as well here, but the way we've organized ourselves, the way we've leveraged technology, well, has been leading to this great performance that we have, in Institutional and Specialty, today. You look at Europe, it was also technology, but it was much more back office, technology. It was much more ERP, Andy, and when you look today, well, Europe, came from 0% margin to 13%-14%, today. So a very solid, good business, that we have there. One Ecolab is connecting all the businesses together in order so for our customers to see One Ecolab, and for us to really help them understand, by leveraging all Ecolab can do, what's the value, what's the savings that me, as a customer, can expect if all my units were at the best performance level of all my locations, how much would that be? It's a different dimension because this one, Andy, is connecting businesses together. The previous ones were by individual businesses. That all led to very good returns at the same time. Thank you. Our next question is from the line of Mike Harrison with Seaport Research. Please proceed with your question. Hi, good afternoon. You noted the High Tech business within the Water segment is growing double digits. Christophe, is there any way to be a little bit more specific? Is that a teens growth rate or more like 20% or 30% or even higher? And can you talk about the penetration rate with data centers or any other context around the opportunity that you're seeing around data centers over the next few years for your Water business? Thank you. So it's been in 2023, so that business, which is a few hundred million, as we've talked about, so has been growing, so in the 30%-ish, like that. We're not disclosing so too much detail so far. It will come, when we have, a more steady state, organization and platform to serve that new industry, we will share that, obviously, with you. But kind of a few hundred million and growing roughly 30% last year, well, it's showing you, kind of, the trajectory, that we have in that business. At the same time, it's a very highly profitable business, because the customers we serve, which are the high tech companies, being semiconductors, manufacturers or data centers, hyperscalers, operators, while those ones are not looking for the most cost-efficient solution, they are trying to find partners that are helping them deliver the highest uptime, the highest power of computing, while reducing the usage of water and energy, because that's the true limiting factor, and that's where we invest all our resources on innovation in order to help those companies produce more computing power while reducing the impact on the environment. So the cost of it is kind of secondary, which means we can invest in high technology. They pay for it. It's good for them, it's good for us, it's good for our shareholders as well. This Global H igh T ech business has been a fantastic business and keeps getting better. Our next question is from the line of Vincent Andrews with Morgan Stanley. Please proceed with your question. Thank you. One more on the One Ecolab, and, and Christophe, you know, you noted that this program is designed for all of your segments. I'm wondering if you can just touch on, you know, within the, the different segments, are there some where you anticipate it having a, a greater impact on volume or a greater impact on price? And, and overall, are there some segments that you think it will benefit more than others? It's an interesting question, Vincent. There is one that I could share so with you. When I think about F&B, as we speak, so we are bringing our Food & Beverage C leaning and Sanitation business together with our Water, F&B business. And don't get me wrong, it's not that suddenly we'll have at the front line people doing both water and cleaning and sanitation. They go hand in hand, but they are complementary. Like you would be in a hospital, you have several physicians that are serving you as a patient. We believe in expertise. We don't believe in generalist. But that business, which will includes our Cleaning and Sanitation and Water together, well, is one of our biggest business, one of our best franchises as well in the world, and I believe that's gonna drive a lot of further value for our customers and for us and our shareholders, obviously here. But you can think as well about Institutional. When you're a restaurant chain, so with thousands of restaurants, in the country or around the world, knowing what's the potential, of performance improvement in dollar terms that I can get if all my restaurants were performing at the best performing one, well, that's huge insight. What's even more important, so with us, is that we can deliver that performance because we've delivered it, for the best performing unit, as well at the same time. And the fact that we share then afterwards the upside for the customer, well, that drives mostly value price, which is not the least price, which is mostly seen in other businesses, I mean, in other companies. For us, value price, and that's why we call it that way, it's our share in the improvement that we are delivering to our customers, which is why it never goes down, by the way, and will keep going up, as we move forward, as well at the same time. So a very good story for all businesses. Food & Beverage is an obvious one, and Institutional, another one, as well. So ultimately, this is bringing our strategy of Circle the Customer, Circle the Globe in ways that are much more hardwired than the way we did it in the past, where we can share the knowledge of Ecolab anywhere around the world, across all businesses and industries. Well, that's a critical reason why I believe that in the quarters and years to come, we will keep delivering day in and day out and get towards our targeted performance of the 5%-7%, our 20% OI margin, and 12%-15% earnings per share growth as our next step of performance. And again, that's not gonna be the last step. This is our next level of performance that we're all working hard to deliver as quickly as we can. Thank you. Mr. Hedberg, there are no further questions at this time. I would like to turn the floor back to you for closing comments. Thank you. That wraps up our second quarter conference call. This conference call and the associated discussion slides will be available for replay on our website. Thank you for your time and participation, and I hope everyone has a great rest of your day. Ladies and gentlemen, thank you for your participation. This does conclude today's teleconference. You may now disconnect your lines, and have a wonderful day.