Good day, ladies and gentlemen. Welcome to the Genuine Parts Company Q3 2024 earnings conference call. At this time, all lines are in listen-only mode. Following the presentation, we will conduct a question-and-answer session. If at any time during this call you require immediate assistance, please press * zero for the operator. This call is being recorded on Tuesday, October 22nd, 2024. I would now like to turn the conference over to Tim Walsh, Senior Director, Investor Relations. Please go ahead, sir. Thank you, and good morning, everyone. Welcome to Genuine Parts Company's Q3 2024 Earnings Call. Joining us on the call today are Will Stengel, President and Chief Executive Officer, and Bert Nappier, Executive Vice President and Chief Financial Officer. In addition to this morning's press release, a supplemental slide presentation can be found on the Investors page of the Genuine Parts Company's website. Today's call is being webcast, and a replay will also be made available on the company's website after the call. Following our prepared remarks, the call will be open for questions, the responses to which will reflect management views as of today, October 22nd, 2024. If we're unable to get to your questions, please contact our Investor Relations Department. Please be advised that this call may include certain non-GAAP financial measures, which may be referred to during today's discussion of our results as reported under generally accepted accounting principles. A reconciliation of these measures is provided in the earnings press release. Today's call may also involve forward-looking statements regarding the company and its businesses as defined in the Private Securities Litigation Reform Act of 1995. The company's actual results could differ materially from any forward-looking statements due to several important factors described in the company's latest SEC filings, including this morning's press release. The company assumes no obligation to update any forward-looking statements made during the call. Now, let me turn it over to Will. Thank you, Tim, and good morning, everyone. Welcome to our Q3 2024 Earnings Call. As always, I'd like to start by thanking our global teammates for their hard work serving our customers, and I'd also like to acknowledge all those who were negatively impacted by the devastating hurricanes in the U.S., I'm proud of our teams as they rallied together to take care of each other and our customers. Our culture shines through with our teammates going above and beyond to navigate the challenge. Taking care of our communities is a pillar of our mission at GPC, and we'll continue to support impacted communities through our partners at the American Red Cross. Let me also welcome Jen Hewlett to GPC. Jen joined GPC in August as our new Executive Vice President and Chief People Officer, responsible for advancing the company's global talent and culture initiatives. This is a critical area of focus as we continuously strive to be an employer of choice. We look forward to Jen's many contributions. Before I get into the results for the quarter, I'd like to take a few moments to provide an update on the business and share my perspective after nearly six months in the role of CEO. GPC has a great legacy. NAPA will celebrate its 100th anniversary next year. Motion is a market-leading, value-added industrial solutions business founded in 1946, and our international automotive businesses in Europe, Asia Pacific and Canada have similar long, proud histories. Together, GPC is a differentiated business with compelling opportunities, individually and collectively as One GPC team in each of the global markets we serve. As we leverage the size, scale, and strength of our company in our fragmented industries, we're intensely focused on evolving the business and leaning into the initiatives around talent and culture, technology, supply chain, and sales effectiveness that we shared at our last Investor Day. Transformation and investment across all industries is critical as customers' needs and markets continue to evolve at increasing speeds. I'm confident that we're doing the right hard work for GPC's long-term benefit as we look to not only extend our existing competitive advantages, but also create new ones. Most importantly, our legacy has created financial strength, both in terms of our cash flow and our balance sheet, to thoughtfully pursue these actions through business cycles. Our capital allocation discipline is elevated as we work to methodically balance foundational, growth and innovative investments across the most attractive and strategic GPC opportunities. In parallel, we're committed to growing our long-standing dividend. We acknowledge that these strategic investments come with near-term trade-offs, including higher costs that are amplified by sluggish market conditions and an underlying inflationary cost environment, in turn, pressuring results as seen in the Q3. We're balancing the medium and long term by offsetting current headwinds with a back-to-basics customer and operational excellence mindset, which is gaining traction as evidenced by improved internal operating metrics. We're also managing core operating costs through global restructuring activities, which are on track to deliver the intended impact. And we continuously pursue initiatives to simplify the business and further enhance our productivity. As we close out 2024 and look ahead to 2025, I wanna highlight select examples of actions that reinforce our enthusiasm for GPC's future. At Motion, we continue to extend our value proposition with our customers with tools, technology and expertise to drive embedded solutions that create value and efficiency for our customers. Further, our investments in automation to address customers' productivity needs, and mobilizing our technical sales expertise to capitalize on reshoring and nearshoring activity present meaningful new opportunities for us. At our U.S. Automotive business, we've invested in inventory to drive better availability by broadening our assortment while simultaneously improving operational productivity. These investments, combined with actions to improve our delivery times from stores, have strengthened our daily value proposition. The quality of the NAPA brand is differentiated, and our long-standing local relationships, geographic footprint, and expertise position us to continue to lead in the Do It For Me segment. The recently announced refinement to the U.S. Automotive operating model will drive greater commercial opportunities in key markets across the U.S., improving revenue growth and profitability over time. Underpinning these activities are critical investments in technology that include automation of DCs with next-generation robotics, enhancements to the customer digital experience, including better search and catalog capabilities, and modernization of our store systems. These investments will position us to deliver a better customer experience and capture growth moving forward. We're also leveraging 250 world-class engineers at our global tech center in Krakow, Poland, to build software for global initiatives, including innovative products with emerging technology. Finally, by leaning into our One GPC operating philosophy, we're unlocking the synergies that exist between our automotive and industrial businesses globally, with meaningful value creation opportunities ahead as we implement, as an example, a re-energized approach to IT collaboration across the globe to simplify and harmonize our operations. In total, our initiatives are designed to create a better customer experience and generate growth in excess of the market, reduce costs, and deliver attractive returns. All our efforts are at different levels of maturity, but all have exciting runway. Our operating cadence as a global leadership team is designed to challenge ourselves and each other each day to be faster, smarter, and better. The decisions to pursue long-term investment are difficult in the face of near-term market headwinds, but we believe that these investments will increase the intrinsic value of GPC over time. Our financial results were obviously below our expectations in the Q3, driven by various market factors that we expect to be temporary in nature, but we are confident that we're doing the right body of work to make the company better. Now, turning to the Q3. Note that our results include the impacts of two major hurricanes, Beryl and Helene, and the start of the Q4 has been affected by Hurricane Milton. For the Q3, total GPC sales were approximately $6 billion, an increase of 2.5% year- over- year due to the benefits of an extra selling day in the U.S. and acquisitions, particularly in U.S. Automotive. However, continued softness in market conditions across our global geographies negatively impacted our sales growth in the quarter relative to our expectations, with the most pronounced impacts in Europe and our global industrial business. The weaker demand environment continues to be impacted by interest rates, combined with persistent cost inflation and election and geopolitical uncertainty. These factors are impacting our customers, most notably with tightened budgets and reduced spending for capital projects in our industrial business, and reduced spending in general maintenance and discretionary categories across our automotive segment. The weak sales environment, along with cost pressure and wages and rent expense, plus anticipated headwinds from depreciation and interest expense, resulted in adjusted earnings being down year- over- year. Adjusted diluted earnings per share in the Q3 was $1.88, down from $2.49 last year. Our results for the Q3 missed our expectations. Our outlook in July included anticipated improvements in market conditions in Europe and global industrial activity, neither of which materialized. Our original expectation for the Q3 included flat industrial sales growth. Actual reported results ended up down low single digits. In Europe, we expected low single-digit organic growth. Actual results ended up flat. The combination of these market headwinds contributed to over $140 million in lower sales in the quarter versus our expectations. Given our results to date and our expectation that these weaker market conditions will likely persist for the balance of the year, we've adjusted our 2024 outlook accordingly. While many of these factors are outside of our control, we remain focused on controlling what we can, and we're confident in eventual market tailwinds. Bert will provide a clear explanation of the impact of hurricanes, variation drivers versus prior year in our Q3 expectations, as well as our updated outlook in his prepared comments shortly. Looking at our results by business segment. During the Q3, total sales for global industrial were $2.2 billion, a decrease of approximately 1% versus the same period last year, and comparable sales were down 2%. During the quarter, we had one extra selling day compared to the Q3 of last year, which positively impacted total sales growth by approximately 140 basis points. Looking at the cadence for the quarter, average daily sales were down mid-single digits in July, relatively flat in August, and down mid-single digits in September. Lagging industrial production activity continues to be the main headwind for our industrial business, as we're now in the longest period of contraction for PMI in over 33 years. While this period of contraction has lasted longer than many expected, history does show us that we typically see a long period of attractive growth once the index inflects into expansion territory. During the Q3, three of our 14 end markets we track showed positive average daily sales growth year- over- year. We saw relative strength coming from pulp and paper and our distribution and logistics segment, which was offset by weakness in equipment and machinery, lumber and wood, and iron and steel. Within industrial, our core MRO business has remained relatively flat year- over- year, with continued strength across corporate accounts through the year. However, customer spending related to capital projects, which represents approximately 20% of sales, has been down mid-single digits versus prior year. We continue to hear from customers considering capital projects that they are pausing, not canceling, these plans until they have better visibility into the interest rate environment and the outcome of the election in the U.S. As the market leader, Motion is well positioned to capitalize on the eventual improvement in the manufacturing economy, near and long- term, to expand our customer base and profitably grow share of wallet in this highly fragmented market. As a testament to Motion's value proposition and customer service, Motion has already received Supplier of the Year awards from six of its largest 25 customers in 2024, surpassing the total it received in the previous four years combined. Industrial segment profit in the Q3 was $259 million, down approximately 8% versus prior year and 11.9% of sales, representing an approximate 100 basis point decrease from the same period last year, driven by sales deleverage, combined with wage inflation and higher depreciation expense. Turning to the Global Automotive segment. Sales in the Q3 were $3.8 billion, an increase of approximately 5%, with comparable store sales up slightly. During the quarter, we had one extra selling day in the U.S. compared to prior year, which positively impacted Global Automotive sales growth by approximately ninety basis points. Similar to the first half of the year, the Global Automotive sales benefit from inflation remained less than 1% in the Q3, and we expect the same in the Q4. Global Automotive segment profit in the Q3 was $262 million, down approximately 19% versus prior year, and 6.9% of sales, down from 8.9% of sales in the same period last year. Our Q3 results for global automotive segment reflect ongoing pressures from a soft sales environment and cost pressures, particularly in Europe and the U.S. Now, let's turn to our automotive business performance by geography. Starting in Europe, our team delivered total sales growth of approximately 6% in local currency, with comparable sales flat. During the Q3, overall market growth remained muted, down low single digits, which was consistent with the Q2. The weak economic backdrop in Europe is being driven by an elevated level of deferred maintenance attributable to real wage declines, unemployment, higher interest rates, and uncertain political and geopolitical situations. In addition, the benefit from same SKU inflation was less than 1%, while the prior year benefit was mid-single digits. As we look at the economic backdrop in three key European markets, Germany, France, and the U.K., higher interest rates continue to negatively impact consumer purchasing power across these three geographies. Furthermore, higher unemployment rates and real wage declines in France and Germany have contributed to softer spending at the consumer level. Collectively, these factors are driving weak consumer confidence across the three markets. Despite this challenging environment, our team continues to outpace the market growth and win share, driven in part by our initiatives with key accounts and the rollout of the NAPA brand, which is a competitive differentiator. In the Asia Pac automotive business, sales in the Q3 increased approximately 7% in local currency, with comparable sales growth of 4%. Sales for both commercial and retail increased in the Q3, with continued strength in retail, particularly in Australia. The macro environment is also challenging in the region, with Australia experiencing the weakest economic growth in nearly three decades, and New Zealand currently is in its second recession in 18 months. However, our teams are executing well, extending our industry-leading position and taking market share. In Canada, sales increased 1% in local currency during the Q3 with comparable sales decreasing 1%. Our Canadian team continues to perform despite ongoing pressure from a more cautious consumer and difficult macro environment. Sales in automotive and heavy vehicle performed similarly during the quarter, with both having positive growth. Lastly, in the U.S., automotive sales increased 4% during the Q3, with comparable sales essentially flat. The extra day versus the same quarter last year positively impacted sales growth by approximately 160 basis points. Our growth was also driven by acquisitions, most notably the acquisition of MPEC that we completed in May. The sales results were broadly in line with our expectations, as we believe we're benefiting from the actions that we've detailed over the last few quarters to improve our execution, and we're seeing a positive impact in the marketplace. Our average daily sales cadence through the quarter was positive in all three months, with July being the softest month. Sales to our commercial customers increased low single digits in the quarter, while sales to Do It Yourself customers was down mid-single digits. Within commercial, fleet and government, auto care, and other wholesale were all positive, while major accounts underperformed the group, but improved sequentially as we remained focused on profitable growth within the major account segment. On a comparable basis, sales from company-owned stores were slightly positive, while comparable sales into our independent stores were down slightly. More broadly, for U.S. automotive, to provide additional perspective on the cautious consumer, on a year-to-date basis, our nondiscretionary repair categories, which accounts for approximately 50% of NAPA's business, were up low to mid-single digits. Our general maintenance categories, which represents approximately 35% of our business, were flat year- over- year, driven by continued cautious end consumer, who's deferring certain service and maintenance-related purchases. Discretionary categories, representing approximately 15% of the business, were down mid-single digits. We continue to invest in our U.S. automotive business for growth and build on significant improvements in service over the past year. During the quarter, we further invested in inventory, increasing the SKU coverage in our company-owned stores by approximately 10%, while driving further productivity in our DCs, which resulted in a more than 8% increase in our internal DC service metrics. We're encouraged with the continued progress and have seen a material improvement in our customer service and store delivery metrics. We will obviously continue to stay focused on this important effort. Going forward, we see the commercial customer as the growth engine of our industry, and we benefit from the fact that 80% of NAPA's business serves this segment. Our continuous improvement on inventory availability, service, and product quality position us well to win in the markets that we serve. Following our successful acquisition of the MPEC business in the Q2, we completed the acquisition of our next largest owner, Walker Automotive Supply, in August, furthering our plan to own more of our stores in strategic priority markets. We added approximately 70 NAPA stores across North Carolina. Year -to- date, we've made strategic acquisitions of more than 450 NAPA stores from our independent owners, as well as competitive stores in key markets, including approximately 160 in the Q3. Our store network in the U.S. is now comprised of over 6,000, of which approximately 35% are company-owned, up from approximately 25% at the end of 2022. Over time, we see a path to bring our network closer to a 50/50 mix, with our independent owners continuing to play a critical role in our network. While our quarterly financial results were below our expectations, we are confident that we are investing in the right areas to better position GPC, and we're experiencing traction across numerous efforts. We believe the current market softness is temporary and will eventually serve as a tailwind. The long-term fundamentals of our industries are attractive, and our businesses are well established with leadership positions. We're balancing near-term actions and medium and long-term investments. Disciplined and consistent investment in our business, particularly during temporary periods of broad, weaker industry dynamics, will strengthen our leadership positions and earn profitable market share and create value. In closing, thank you again to our global teams for the leadership and hard work, and with that, I'll turn the call over to Bert. Thanks, Will, and thanks to everyone for joining the call this morning. Our results for the quarter reflect the impact of several factors: weak market conditions, the cost impact of investments we are making in the business, and disruptions from the CrowdStrike outage in July and two major hurricanes. The Q3 was challenging, and in evaluating our financial results and to provide additional transparency, we've reflected on three key themes, which I will address, along with an update on our cash flows and capital allocation. Those themes are: what drove our profitability down year- over- year? How did the quarter differ from our expectations? And what is our outlook for the remainder of 2024? My comments this morning will focus primarily on adjusted results, which exclude the nonrecurring costs related to our previously announced global restructuring program and costs related to the acquisition of MPEC and Walker. During the Q3, we incurred a total of $45 million of pre-tax costs, or $36 million after tax, related to the restructuring efforts and integration activities. Before I review our three key themes in detail, let me share some high-level context for our results, starting with sales. Total sales were up 2.5% in the Q3, which included a benefit from acquisitions of 320 basis points and the benefit of an additional selling day in the U.S., totaling 110 basis points. Sales in the Q3 were negatively impacted by disruptions from hurricanes, Helene and Beryl, as well as the CrowdStrike outage, totaling approximately 70 basis points. For the quarter, our gross margin was 36.8%, an increase of 60 basis points from last year. The improvement in our gross margin was driven by acquisitions, primarily at U.S. Automotive, which drove approximately 60 basis points of gross margin expansion. Turning to costs, our SG&A as a percentage of sales for the Q3 was 28.8%, up 220 basis points year- over- year. The impact of acquired businesses, investments in IT, and cost pressures contributed to the year-over-year deleverage. More specifically, our MPEC and Walker acquisitions negatively impacted SG&A by approximately 50 basis points. The incremental SG&A from acquired businesses will abate over time as we execute on our integration plans and capture synergies. We are now five months and two months post-close of our MPEC and Walker transactions, respectively, and expect each respective integration to take approximately 24 months from start to finish. Our integration efforts are on track with respect to timing and synergy capture. Both acquisitions contributed positively to our EBITDA margin in the Q3. Inflation-driven increases in rent expense and salaries and wages, including increased minimum wages in certain international markets, along with service improvement investments and freight expense, resulted in approximately 120 basis points of SG&A deleverage versus the prior year. In addition, our planned investments in technology to modernize our business resulted in a 20 basis points headwind in SG&A in the Q3. Our global restructuring initiative remains on track. Our restructuring efforts are a key element of our work to offset the headwinds of current market conditions and cost inflation across the business. Year- to- date, we've incurred approximately $160 million of costs related to our restructuring efforts, in line with the top end of our range of $100 to $200 million of costs. During the Q3, we realized approximately $16 million in benefits from our restructuring efforts and expect to deliver a benefit of between $30 to $40 million in 2024, and $45 to $90 million on an annualized basis, in line with our expectations. With that context, let's turn to the first theme, our Q3 profitability. Our Q3 results were down year- over- year from an adjusted EPS of $2.49 to an adjusted EPS of $1.88, a decline of $0.61. As we look at the details, I will describe the major drivers of our year-over-year decline in terms of impact to EPS, and you can see these illustrated in our earnings presentation. First, as we expected, higher depreciation and interest expense, combined with IT costs I referenced in my SG&A comments, drove approximately $0.25 of the year-over-year decline in earnings. Our initiatives come with cost headwinds, which we anticipated and planned for in 2024. These costs are in the form of higher depreciation expense as we depreciate new investments, higher SG&A, as our efforts to modernize IT show up in operating expense, and higher interest expense from borrowings to fund investments, particularly in this higher interest rate environment. As I mentioned, core cost inflation is negatively impacting salaries and wages along with rent expense, and we are making investments to improve service that are contributing to higher freight expense. For the quarter, these higher costs, combined with deleverage on lower sales, reduced our year-over-year earnings by an estimated $0.38. These negative impacts were partially offset by benefits of our global restructuring actions, totaling $0.08. Finally, the quarter was negatively impacted by lost revenues as a result of the impacts of disruptions from the hurricanes and the CrowdStrike outage, which translated into an estimated $0.06 reduction in earnings for the quarter. With respect to Hurricane Helene, we closed September with approximately 200 locations across NAPA and Motion impacted by power outages and storm damage. Many of these locations have come back online, but we continue to operate with closed stores and disrupted customers. With respect to the second theme, related to our expectations, we underperformed where we expected to be in the Q3. As we shared in our Q2 earnings call, we expected weak market conditions and headwinds from depreciation, IT investments, and interest to result in lower Q3 earnings, and we were targeting an adjusted EPS range of $2.20 to $2.25. Our adjusted results for the quarter, with EPS of $1.88, came in below our expectations, driven by two key factors: weaker results in Europe and our industrial business, and the impact of CrowdStrike and the hurricanes. When we gave guidance in July, our outlook assumed sequential improvement in market conditions in the second half of 2024 and tailwinds from easing comparisons. More specifically, our original expectations for the Q3 included industrial sales growth coming in flat and low single-digit organic European growth. Underlying European market conditions did not inflect in the quarter and remained negative on a sequential basis from the Q2. For industrial, PMI closed June at 48.5, nearly flat to May, and then turned sharply negative in July at 46.8, rebounding slightly to 47.2 in both August and September. Along with negative industrial production manufacturing readings in September, this backdrop resulted in our sales for industrial in the Q3 being down. As Will shared, the underperformance of our European and industrial businesses versus our expectations translated into $140 million in reduced sales or an estimated $0.30 of earnings. When combined with a $0.06 impact from CrowdStrike and the hurricanes, this led to an approximate $0.36 earnings shortfall versus our expectations. Our Q3 performance, which was largely driven by ongoing weak market conditions, led us to the third theme, our outlook for the remainder of 2024. Based on the trends we are seeing in our business, including our lower than expected Q3 performance, we are adjusting our 2024 outlook. With no sequential improvement in market conditions in the Q3 from the Q2, our revised outlook reflects our view that the demand environment for the balance of the year will remain consistent with the Q3. We now expect that diluted earnings per share, which includes the expenses related to our restructuring efforts, will be in the range of $6.60 to $6.80, compared to our previous outlook of $8.55 to $8.75. We now expect adjusted diluted earnings per share to be in a range of $8 to $8.20. This compares to our previous outlook of a range of $9.30 to $9.50. Our earnings presentation includes an illustration of the key business drivers impacting our revised outlook for 2024. Let me take a moment and walk you through the details of these components, starting with sales. We now expect total sales growth in a range of up 1% to 2% versus our previous outlook of up 1% to 3%, which includes the benefit of acquisitions we've made year- to- date. By business segment, we are now guiding to the following: 3% to 4% total sales growth for the automotive segment, which includes the benefit of acquisitions made year- to- date. We anticipate comparable sales growth to be approximately flat, and for the industrial segment, we expect total sales growth to be down 1% to 2%, with comparable sales growth also down 1% to 2%. Our reduced sales outlook for the year is driven by updated expectations around market conditions. For the balance of 2024, we do not expect any improvement in market conditions across our geographies. Our expectations are informed by third-party data, as well as the trends we experienced in the Q3, which have persisted into the start of the Q4. Further, the beginning of the quarter has been compounded by the impacts of Hurricane Milton across Florida, as well as the continuing effects of Hurricane Helene. While we've made good progress on restoring our operations, uncertainty remains around our customers and their ability to resume operations, which makes the ultimate impact on our business difficult to predict. Our updated guidance includes our estimated impact of these storms on our results for the remainder of the year. Within industrial, the weak industrial production activity remains a headwind for the business. As Will mentioned, we are now in the longest period of contraction for PMI in over 33 years. We now believe that improvement won't come in 2024, as we wait for PMI to inflect into expansionary territory and for the benefit of initial interest rate cuts to have a positive impact on our customers. In our international and U.S. automotive businesses, market conditions continue to remain soft as consumers are impacted by a wide range of factors, including inflation, interest rates, and geopolitical election uncertainty. In the U.S., while our independent owners continue to gain strength, high interest rates remain a headwind for these small and medium business owners. For gross margin, we continue to expect 40 to 60 basis points of full-year gross margin expansion, primarily driven by the acquisitions in U.S. automotive and our strategic sourcing and pricing initiatives. Our outlook assumes that SG&A will deleverage between 140 and 150 basis points, which includes SG&A deleverage on our reduced sales outlook, ongoing cost inflation, and the impact of incremental SG&A from acquisitions in the U.S. automotive business. Our views include the expected benefits from our global restructuring activities. For global automotive segment margin, we now expect to be down approximately 90 to 100 basis points versus last year, given the softer organic sales growth and corresponding pressure on SG&A. For 2024, we expect global industrial segment margin to be down approximately 40 to 50 basis points year- over- year. For the first nine months of 2024, we generated $1.1 billion in cash from operations and $700 million in free cash flow. We are confident in the strength of our cash flows in 2024 and continue to expect cash from operations to be in a range of $1.3 to $1.5 billion, with free cash flow of $800 million to $1 billion. Delivering consistent cash flows in all business cycles, combined with our liquidity, a strong balance sheet, and disciplined capital allocation philosophy, positions us to grow the business long term. In 2024, we have invested approximately $386 million back into the business in the form of capital expenditures. Including $126 million in the Q3. With respect to capital expenditures, as we shared at our Investor Day in 2023, our historical investment rate in our business hovered at around 1% or less of revenue. Over the past two years, to drive the needed transformation of our business, this has moved to 2% of our revenue, and we continue to expect an investment rate of 2% of revenue, or approximately $500 million in spending in 2024. The growth capital we are deploying, which represents approximately 55% of our total 2024 CapEx, will drive modernization of our supply chain, including new DCs and automation, that, when partnered with technology, enhances our customer experience and positions us for long-term growth. Further, disciplined M&A has been a key element of our growth as we take advantage of value creation opportunities in our fragmented markets globally. In 2024, our M&A strategy has evolved with respect to our operating model at NAPA, and our new approach to having a more balanced mix of company-owned and independently owned stores will improve our revenue growth and profitability over the long term. We have invested $954 million globally year- to- date in the form of strategic acquisitions, including the acquisition of our now largest independent owner, Walker Automotive Supply. As we acquire these businesses, we have a disciplined integration playbook, where we extract value through incremental sales opportunities, capture the full gross margin, and optimize the SG&A of the acquired business. During the Q3, we further strengthened our balance sheet by initiating the transition of our U.S. pension plan to a third-party insurance company, which we expect to complete in the Q4 of 2025. This is a continuation of our pension de-risking strategy that began in 2013, when the plan was frozen and does not impact the benefits of the plan participants. Our pension plan is well-funded, and we took this step to reduce balance sheet and income statement volatility and protect us from future potential cash flow contributions. We anticipate a one-time non-cash charge in the Q4 of 2025 and do not expect any impact to our 2024 financial results. Further, we do not expect any cash payments associated with the transfer of the plan to the third-party insurance company in 2025. In closing, we continue to operate in challenging market conditions and are taking actions, including advancing our global restructuring activities, to ensure the long-term profitability of the business. We believe the backdrop of lower growth is market-driven, not specific to our business, and we stand well positioned for growth once the cycle turns more favorable. As we look ahead, we are encouraged by the recent reduction in interest rates in the U.S. and are optimistic that lower rates will create a more constructive market backdrop moving forward, although we recognize that this will take time to result in improved activity. We remain confident in the underlying fundamentals of our businesses and will continue to invest in the business with a long-term focus. Thank you, and we will now turn it back to the operator for your questions. Thank you. Ladies and gentlemen, we will now begin the question-and-answer session. Should you have a question, please press * followed by the one on your touch tone phone. You will hear a prompt that your hand has been raised. Should you wish to decline from the polling process, please press * followed by the two. If you are using a speakerphone, please lift the handset before pressing any keys. Please limit yourself to one question and one follow-up. One moment, please, for your first question. Your first question comes from Kate McShane with Goldman Sachs. Your line is now open. Hi, good morning. Thanks for taking our question. Thanks for all the detail on the call today. One area that we wanted to learn a little bit more was just the detail around the inventory increase you saw during the quarter, and if you could maybe drill down into some of the investments that you're making in freight. Sure, Kate. Good morning. Look, on the inventory side, I think that goes back to really some of what Will touched on in positioning us in the marketplace on the NAPA side. We've made some great strides on getting inventory availability where it needs to be. That's a year-over-year kind of effort. We started that this time last year, as you recall, and I think we've really made some nice moves to increase depths, increase SKU count, and do the things that matter in the field. We know that inventory availability is the deciding factor in being successful. NAPA's got a great legacy, it's got a great brand, it's got a great footprint, and so when we put that inventory power behind it, I think it really positions us well in the marketplace. That's the biggest driver of the change there. We also have some acquired inventory from the acquisitions we've made, so that'll show up in the balance sheet as well. In terms of investments in freight, you know, some of those are a bit competitively sensitive. I would just leave it at the fact that we're really leaning into making sure that we've got, on the other side of the equation, that store excellence, making sure we have the driver availability and consistency of experience that we want to make sure we're meeting the needs of our customers. Kate, I might just add, you know, as we look at all the internal operating metrics that we use to run the business, in particular in NAPA, we continue to be very bullish about the progress that we've made. So whether it's service levels from deliveries to stores, from DCs, from stores to customers, those are at all-time highs and getting better every day. As Bert said, the inventory strategy was all about making sure that we had the right vendor alignment with the right availability in the local markets, and those have seen material improvement year- over- year. S afety is better in our DCs. Inventory, breadth and depth, as Bert alluded to, has never been better, so we've added deeper and wider inventory while using our existing supply chain. Voluntary turnover is down 30%+ year- over- year, and importantly, we're seeing about 100 basis point improvement in our customer metrics in terms of their satisfaction. So as we're running the business and putting these investments in, we feel good about the returns that are associated with them. Thanks, Kate. Your next question comes from Scot Ciccarelli with Truist. Your line is now open. Yes. So you did not call out U.S. Auto as a primary source of profit disappointment in the quarter. Does that mean U.S. margins held up and the total margin decline was really due to the international business? Or does that mean you just had subdued expectations for U.S. Auto? And then, secondly, obviously, 2024 is going to fall well below initial expectations. Without providing any specific guidance, can you give us a general feel for how you're thinking about 2025, meaning the sequential trends continue to weaken, but your comparisons get easier, et cetera? Thank you. Hey, Scot, it's Bert. Look, on the margin side, for U.S. Automotive, you know, we don't really get into the details by the individual regions. I will say that the pressure we felt at the consolidated level was consistent across all the markets, and so we were disappointed in total with where we were. It came in underneath our expectations, as we've outlined, but I wouldn't isolate the pressure in any one market regionally around the world versus the other. They're all feeling the same kind of pressure, interest rate pressure in all of our markets on the automotive side. Cost inflation are both present in all of those markets. And so when we think about the factors that drove SG&A that I outlined in my prepared comments, those would be true for each of the regions individually. In terms of how we're looking ahead, and as you said, we don't want to get too specific. But look, I mean, I think the bottom line on 2025 is that we're going to continue to watch all the same data that you all are. And at this point, as we exit the Q3 and start the Q4 and start to look into 2025, those conditions remain pretty stagnant quarter- over- quarter. And so market conditions are going to be a big factor in how we look at things. The bottom line, though, is we're very encouraged by the long-term fundamentals for both segments. And we're in break-fix industries. I think those are beneficial to us in the long term. Our size and scale is a benefit there as well. We have leadership positions in fragmented markets around the globe, and we're bullish on the execution of our strategic initiatives, as we'll outline, but the biggest wildcard moving ahead with that positive backdrop is the pace and timing of recovery of market conditions, and so we'll take the Q4 to see what we think the market will give us for next year, plus our own actions and the things that we think we're going to be able to do, and we'll update that and share that with you in February. Scott, I might just add, in the same way that, we've articulated that, higher interest rates have had the intended effect, muting and slowing down overall growth, we are encouraged, obviously, by the start of an easing, scenario around the world. The U.K. has reduced rates, once in the last, call it six months. U.S., once. Eurozone, three times. Canada, three times. So, obviously, there'll be a lag benefit to that, but we would hope as we move forward, those types of policy decisions, provide a tailwind as opposed to a headwind. Great. Thanks, guys. Yeah, thank you. Your next question comes from Michael Lasser with UBS. Your line is now open. Good morning. Thank you so much for taking my question. Your SG&A dollars were up about $166 million in the quarter versus the same year ago. Can you outline a bit more what drove that increase? And should we expect the pace of increase to continue for the next several quarters, given the investments that you're making? Hey, Michael, good morning. Look, a big part of the dollar increase in SG&A is going to come from acquired businesses. So I think that's an isolated activity, particularly here as you look in the second half of 2024 with the acquisition of our two largest independent owners on the NAPA side of the house. So I kind of outlined that and detailed that in my prepared remarks. On that particular point, we would expect that SG&A to abate over time as we continue to integrate those businesses and capture synergies. The great news is we're on track on that front. We're seeing our synergy capture come in consistent with our business case, and as I shared, both of those acquisitions contributed positively to our Q3. As we look ahead on some of those other elements, I think we'll continue to see pressure here in the near term on the cost side of things, with inflationary impacts on wages and rent. I don't expect those to abate in the Q4, and, and likewise, we're going to continue to invest in IT. That's an important part of our transformation going forward, and there's some positive things there. Unfortunately, as we modernize systems, many of those are cloud-based platforms that transition expense out of capital into operating expense, which is why we're highlighting that for you, but we're also making some great investments in the business, in particular with our Global Technology Center in Poland. We benefit from exceptional talent, high productivity, and these teams are doing amazing work on some of our initiatives around catalog and search, which is clearly making a difference with our customers. So when we think about investment, that's an example of a thing I think you'll continue to see, but at the same time, we're also trying to be very thoughtful about offsetting some of this with our global restructuring, which remains on track. We saw a benefit in the quarter, as we've discussed, and we're continuing to control headcount. The restructuring is helping with that. Most of that has come from voluntary retirements in the U.S., but if we look at our global headcount, we're down somewhere between 3% and 5% in 2024, excluding acquisitions. And we're continuing to do hard work across the network with engineering standards and engineering productivity and our DCs. That's reducing overtime and allowing us to be more thoughtful about headcount there as well. Okay. My follow-up question is, your decision to make incremental investments in the business was inevitably prompted by something. You outlined your view that U.S. Auto business was down, your business was flattish. So what is motivating the decision to make these investments, and how do you expect the return on these investments to play out in the next few quarters in terms of market share? Thank you. Yeah, look, Michael, I think it's super important for any business to be investing in itself, and so I think as, you know, the management team organized their strategic plan, in particular, dating back to our Investor Day in 2023, we had a lot of compelling opportunities to invest back in the business in a different way, which I think is a function of the market realities, the changing technology landscape, the competitive dynamic. And so all those things put together set the stage for putting capital to work around the world in an accelerated way. And Michael, I'll just add that I believe that if you looked prior to Investor Day in 2023, you would have seen the GPC business in totality, spending about 1% of revenue in terms of investment in the business, and so that's across all of our business segments. And that, quite frankly, I think, is not the level of investment we needed to stay at pace and grow this business and keep it on its front foot going forward. We think the technology work that we're doing and leading with technology is gonna be a differentiator, and we think investing in our supply chains, which will make a difference for our customers, and as we know, having that part and having it at the right place and the right time, both on the automotive and the industrial side, is critical to being successful, and as we make these enhancements across DCs, which we've mentioned, we're doing that in the U.K. and France, here in the U.S., we have a new DC in Melbourne. We're doing this all over the world, and you combine that with the technology, I think that's gonna position us for much stronger growth, particularly as we come out of this weaker economic cycle. Thank you very much. Thank you. Your next question comes from Chris Horvers with JP Morgan. Your line is now open. Thanks. Good morning. So my first question, I just wanna be clear, so was there a decision to step up investments above the original plan for this year, or is it, is it really just the acquisitions? And as we think about moving forward, do the acquisitions that you made during this quarter, during the Q3, take sort of the underlying dollar run rate higher as we look at the Q4, obviously, relative to revenues? Yeah, Chris, we haven't changed our view on investment level on CapEx for 2024. We're still gonna come in right around that 2% level, and as I commented in my prepared remarks, that's gonna be around $500 million of investment. So there's no step up on the CapEx side of the house. We really think the 2% number is the right proxy. We did that last year, we'll do that again this year, and we'll be thoughtful about how we look ahead to 2025. In terms of run rate on acquisition, I think I would tell you that we expect that to... That was never gonna be linear. I think it's the best way to say it when you think about the independent owner strategy. As you've seen this year, we've acquired the two largest, and from there, you know, acquiring 180+ stores in May, as we've announced with Walker, 75 stores. The next levels of independent owners drop pretty significantly in terms of store count size. And so I think you'll see, while we continue to march to maybe a more 50/50 target, the pace and timing of that will slow. So I think we get the first two big ones, which were important to do, in the queue first, and then we'll move at pace, but the pace will decelerate from what you've seen here over the last two quarters. Got it. And then, as you think about just, you know, what are we expecting? What are, like, implied same store sales and organic growth in NAPA, in Motion? And as you look out, you know, and you think about the industrial side of the business, you know. Does the election sort of like a clearing event, or do we have to wait for, you know, these capital budgets to come through for your customers in 2025, such that this actually could prolong to perhaps the Q2 when that capital gets deployed? Chris, I would say the election is a clearing event with a lag. So by the time you turn the calendar year, the election, you know, flips, and there's at least some clarity on the margin relative to where we stand today, especially with the backdrop of lower rates, and I think that, that helps. In the implied comps for the Q4? Not for the Q4. I would say the lag is coming into 2025. I don't think the election clarity in November creates a business impact immediately in November and December. Look, Chris, we don't give quarterly guidance, so the quarter comps we haven't provided, but I would just say I'd go back to my thoughts in the prepared remarks. We really don't expect the Q4 thematically to look much different than the Q3 in terms of the underlying performance of the business, given the market conditions. Got it, and I just want to ask one clarification question. So I think you talked about a $0.30 EPS headwind on a $140 million shortfall in sales. Is that right? Because that's like a 40% operating margin. I guess, asked the other way, if, you know, if you expected sales up 2.5% next year, you would expect next year, you expect 40% flow-through on that? No, I wouldn't take it that way, Chris. I mean, I think we're trying to give you a reasonable proxy of what we felt like the sales loss was. I mean, given the gross margin rate impact of that and the lost sales in the quarter. So I wouldn't overread into that in terms of operating margin. Got it. Thank you. Your next question comes from Greg Melich with Evercore. Your line is now open. Hi, thanks. I have a couple of questions. I wanted to start, maybe at a high level, given that, I think, Bert, you described the investments, you're ramping up to 2% now versus 1%. When we think about the growth algo that you outlined at the Analyst Day in 2023, should we be thinking about this year as a new base to build that off of? Or should we still go back, to where we were a couple of years ago and have the growth off of that base? I think this year is a tough year to use as a proxy, Greg, is my kind of initial response to that. You know, we've had a lot of moving pieces. Market conditions have moved backwards. I think as you look historically, we've said that the growth algorithm is in that three to four top line range, in the long term for the business in terms of top line, and that we can lever off of that. This year, with market conditions, particularly on the industrial side, moving negative, is not a year I would use as a proxy. So I don't think we're ready to move off of what we think are long-term algorithms, but obviously, we reserve the right to kind of update you as we get into 2025 and the 2025 guidance, particularly as we see what the Q4 presents and how we think the beginning of 2025 will start. Let's not deviate from how we think about the health of this business on a long-term basis as Will has said. I think we're very bullish on what the long term can be and the investments we're making in the business. Those have stepped up from a 1% historical rate, but that 2% is the same level of investment we shared with you in Investor Day. We think that does set a little bit of a new proxy there. But again, we'll come back to you with some more thoughtful outlook when we get to February. Got it. And then my follow-up was, you mentioned how disinflation has brought inflation down in both industrial and auto to sub 1%. Remind us of how that cycles, if you think about the comparisons from a year ago, and should we expect that to normalize back at maybe the long-term 2% to 3%, or do you think we're sort of stuck at this flattish position? Look, again, I'll always reserve my right to update you when we build our models for 2025 and share those in February. But I think we're coming out of the period that we all expected. We saw this start last year in 2023 in the U.S., and we're seeing it now in Europe. We expected those high benefits of inflation in the top line to cool off, and they have. We're going through what I think is the unwinding of all that now. And, again, if I go back to the first question about the long term, if you think the long term is a three to four, embedded in that long term is a 0.5% to 1% range of price benefit. We would expect in the long term, absent something else coming to light that changes our view on the health of the markets fundamentally, that that would be the case, and we would revert to something more normalized as we move ahead. Got it. And then last, I would just say, how would you describe your market share positioning right now, in U.S. Auto and industrial? I mean, I know there's a lot of macro headwinds. Do you think you're gaining share, holding share, still slipping a little bit? No, we feel really good about it, and we use, on the NAPA side, a third-party independent data that's got everybody's information in it, and it's never been stronger. Always opportunities. There's 120 categories that you have to look at to study, you know, SKU level share, and we've made incredible progress there. So, and then on the industrial side, we're right there or better than the market. There's some data points out there from peers and obviously the PMI, so down a little bit in this market is at or better than market performance. That's great. Thanks, and good luck, guys. Thanks, Greg. Your next question comes from Seth Basham with Wedbush Securities. Your line is now open. Thanks a lot, and good morning. Just following up on Greg's last question, thinking about the U.S. market, your comps were flattish, actually extra day, sequentially, and slow materially on to your stack basis. Do you think that market conditions got worse, or do you think that the competitive environment got more difficult this quarter relative to last? I think the markets got worse, and the hurricane impact put noise into the data, so a flattish market feels about right to us, a plus or minus a point. And on the second part of that, Seth, on the competitive set, I mean, I wouldn't say that the competitive sets changed much. We have great competitors. We compete day-to-day with a competitive landscape that- thankfully remains very rational on pricing, and so we're encouraged by NAPA's position in the market, as I said earlier, with its great footprint, legacy, availability and quality. Specific to the major account segment that you talked about getting a little bit better this quarter, what's driving that? Do you think it's the end markets? Do you think it's some of your initiatives? Any color there would be appreciated. Yeah, so, we were really pleased with the sequential improvement in major accounts. As I think we've talked about publicly before, inside our major accounts, we have four or five different books of business, and each have their own specific initiatives, and those initiatives are gaining traction, specifically around some of our priorities in our regional, quote, unquote, "major accounts," and our independent affiliates, so we're focused intentionally there to make sure that we're doing business that makes sense for our customers and for us, and we'll continue to be very thoughtful there. Great. Thank you so much. Your next question comes from Bret Jordan with Jefferies. Your line is now open. Hey, good morning, guys. Hey, Bret. A lot of it's been covered, but I guess ex the hurricanes, do you see any meaningful regional dispersion in U.S. NAPA? We have, we haven't seen any dispersion, ex the hurricanes and then ex the M&A benefit. Everybody was around the same level of performance, no material difference. Okay. And then I think in the prepared remarks, you talked about either nearshoring or reshoring some of your supply chain. Could you give us a little more color on that? And is that? Is there a margin impact one way or the other? Yeah, look, I think we had a great update with the Motion team. A few weeks ago, we detailed this deeply, and we've got a lot of great sales leads and traction, for that matter, around specific projects. I think on one of the calls, somebody asked us what that opportunity set is, and if you just look at the U.S. business by itself for Motion, you know, we're tracking somewhere over a 150 different projects between now and 2030, that represent about $2.5 billion of MRO spend for us. So some small portion of that is a pretty attractive incremental headwind or a tailwind for us, and we've put some resources to it and seen some nice traction by vertical. That's what we refer to as our new sales vertical. So, definitely in focus. We see it in Canada, and we've got the same chart in Mexico, all with exciting opportunities. Okay, thank you. Thanks, Bret. Thanks, Bret. Ladies and gentlemen, this concludes your conference call for today. We thank you for participating and ask that you please disconnect your lines.