Thank you for standing by. My name is Greg, and I will be your conference operator today. At this time, I would like to welcome everyone to today's Gates Industrial Corporation Q1 2025 Earnings Call. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question-and-answer session. If you'd like to ask a question during this time, simply press star, followed by the number one on your telephone keypad. Once again, star one. If you'd like to withdraw your question, press star one again. Thank you. I would now like to turn the call over to Rich Kwas, Vice President of Investor Relations. Rich. Greetings, and thank you for joining us on our first quarter 2025 earnings call. I'll briefly cover our non-GAAP and forward-looking language before passing the call over to our CEO, Ivo Jurek. We'll be followed by Brooks Mallard, our CFO. Before the market opened today, we published our first quarter 2025 results. A copy of the release is available on our website at investors.gates.com. Our call this morning is being webcast and is accompanied by a slide presentation. On this call, we will refer to certain non-GAAP financial measures that we believe are useful in evaluating our performance. Reconciliations of historical non-GAAP financial measures are included in our earnings release and slide presentation, each of which is available in the investor relations section of our website. Please refer now to slide two of the presentation, which provides a reminder that our remarks will include forward-looking statements within the meaning of the Private Securities Litigation Reform Act. These forward-looking statements are subject to risks that could cause actual results to be materially different from those expressed in or implied by such forward-looking statements. These risks include, among others, matters that we have described in our most recent annual report on Form 10-K and in other filings we make with the SEC. We disclaim any obligation to update these forward-looking statements. We will be attending the Wolfe Global Transportation and Industrials Conference and KeyBanc Industrials and Basic Materials Conference next month and look forward to meeting many of you. Before we start, please note all comparisons are against the prior year period unless stated otherwise. Now I'll turn the call over to Ivo. Thank you, Rich. Good morning, everyone, and thank you for joining our call today. Let's start on slide three of the presentation. Our first quarter sales outpaced our initial guidance, supported by positive core sales growth of 1.4%, with both volume and price contributing. Our replacement channel sales grew mid-single digits, driven by high single-digit growth in Automotive Replacement. At the end market level, ongoing softness in the agriculture and construction markets and weakness in energy were more than offset by strong growth in Personal Mobility and mid-single digit growth in our automotive end market all in. Our adjusted EBITDA margin exceeded 22%, and our gross margin expanded to 40.7%. We continue to advance our various enterprise initiatives, which are primarily focused on gross margin improvement. Our net leverage finished at 2.3 x at the quarter end and decreased slightly year- over- year. Our free cash flow performance was consistent with normal seasonality. Our balance sheet is in solid shape. We repurchased $13 million of our shares during the quarter and have over $100 million remaining under our existing authorization. We are maintaining our initial 2025 financial guidance. We have implemented actions to mitigate the relevant tariff impact on our business based on current tariff rates, with price increases being the predominant tool. Our existing in-region for-region operational structure limits the present tariff regime exposure, and we anticipate offsetting the estimated tariff impact through price implementation and various operational initiatives. Brooks will provide more detail on our exposure in a few minutes. Since the U.S. presidential administration's announcement on tariffs on April 2nd, we have not observed a noticeable change in customer demand or behavior. That said, there is more uncertainty in the market now relative to the start of the year, and we continue to exercise a healthy dose of pragmatism in our forward planning. We are managing costs more closely, and we are prepared to take additional actions as needed. Our manufacturing footprint is largely in-region for-region, which we believe is an advantage relative to our competition. Furthermore, since 2022, we have worked extensively to optimize our sourcing and logistic networks. We are well positioned to continue to deliver further optimization as the current tariff policies take additional hold. Our seasoned management team has experienced multiple economic cycles as well as previous supply chain dislocations. I'm confident in our team's ability to effectively manage our business as we enter this period of increased uncertainty. Please turn to slide four. First quarter total sales were $848 million, which translated to core growth of 1.4% and was slightly better than our guidance. Total revenues were down just under 2%, inclusive of unfavorable foreign currency effects. Our automotive growth was healthy, supported by the replacement channel growing high single digits on a core basis, which more than offset weakness in Automotive OEM. Industrial end market demands generally remain soft, although core revenue decreases were less of a headwind relative to prior quarters. Personal Mobility continued to recover and contributed nicely with more than 30% growth. This was offset by continued soft demand in the agriculture and construction end markets, which decreased in the mid-single digits. We experienced greater stability in the Industrial Replacement channel with core sales performance about even with the prior year period. Book- to- bill finished just above one for the quarter. In general, business activity followed our normal seasonality, and we did not observe material pre-buy activity during the quarter. Adjusted EBITDA was $187 million and represented a margin rate of 22.1%, a decrease of 60 basis points. The year-over-year margin performance was in line with the midpoint of our guidance. Recall, we had a non-recurring profit benefit primarily related to insurance proceeds in the prior year period that added approximately 100 basis points to last year's margin performance. Gross margin measured 40.7%, and we exceeded the 40% threshold for gross margin for the fourth consecutive quarter. Adjusted earnings per share was $0.36, an increase of approximately 6%. Underlying operating performance was positive, although offset by the non-recurring favorable items from last year discussed earlier and unfavorable foreign exchange. Lower interest expense and lower share count combined contributed about $0.03 to adjusted earnings per share. On slide five, we'll review our segment highlights. In the Power Transmission segment, we generated revenues of $527 million in the quarter, which translated to approximately 2% increase on a core basis. The replacement channel was up year- over- year, led by mid-single digit growth in Automotive Replacement. Overall, Power Transmission OEM sales were slightly down, driven by a high single-digit decrease in Automotive OEM sales. Industrial OEM sales benefited from double-digit growth in Personal Mobility. Demand was muted across the balance of industrial end markets in Power Transmission. In the Fluid Power segment, our sales were $320 million. On a core basis, sales were approximately flat. Demand in the replacement business was healthy, supported by Automotive Replacement, which grew mid-teens. Industrial Replacement stabilized with sales approximately flat. Industrial OEM sales declined low double digits on a core basis. With respect to profitability, both segments were impacted by foreign currency headwinds as well as incremental SG&A expenses related to investments in system improvements we referenced on our last earnings call. The Power Transmission segment partially offset these headwinds with benefits from strengthening recovery in Personal Mobility, while the Fluid Power segment experienced greater margin pressure due to ongoing demand softness in the agriculture and construction end markets. I will now pass the call over to Brooks for further comments on our results. Thank you, Ivo. I'll begin on slide six and review our core sales performance by region. North America returned to growth in the quarter, while China and East Asia continued to experience positive core sales growth consistent with the trend experienced during the second half of last year. EMEA and South America both declined year- over- year. In North America, core sales grew low single digits, driven by mid-teens growth in Automotive Replacement. The underlying demand in the channel remains constructive, further supported by incremental revenue from inventory load-in with a new channel partner. Personal Mobility core sales also increased double digits. This growth was partially offset by lower OEM demand. Industrial OEM channel sales decreased low teens. In EMEA, core sales fell just under 1%. OEM sales were approximately flat, with automotive weakness offset by growth in industrial. Industrial OEM sales were supported by recovery in Personal Mobility. Replacement sales were mixed, with Automotive Replacement core growth in the low single digits and Industrial Replacement down mid-single digits. The energy end market continued to be a headwind within the region's results. China core sales expanded 3.5% with broad-based growth. Industrial end markets grew mid-single digits, with Diversified Industrial being a significant contributor. OEM sales grew low single digits, with industrial growth offset by weakness in automotive. The replacement channel grew mid-single digits, supported by growth in both industrial and automotive. East Asia and India posted approximately 5% growth in core sales. Automotive Replacement, Diversified Industrial, and Personal Mobility were the major contributors. South America core sales declined low single digits. On slide seven, we lay out the key drivers of our year-over-year change and adjusted earnings per share. Operating performance contributed approximately 4 cents per share, driven by gross margin expansion. The operating performance was offset by unfavorable foreign currency and a $0.02 per share headwind from the non-recurring favorable items realized in the prior year period. Lower interest expense, a lower share count, and higher other income collectively contributed $0.04 per share. Slide eight has an update on our cash flow performance and balance sheet. Our free cash flow for the first quarter was an outflow of $19 million, which is in line with our normal seasonal performance. As we mentioned on last quarter's call, we have increased our CapEx investments this year to support key footprint optimization and system enhancement projects. Our net leverage ratio declined to 2.3 times, which was a 0.1 times improvement relative to the prior year period. We repurchased $13 million of our shares in Q1 and have over $100 million remaining under our existing authorization. Our trailing 12-month return on invested capital was 22.5%, a modest decline compared to the prior year. Our capital spending has increased to support projects that we anticipate will contribute to future expansion of our return on invested capital. Turning to our 2025 guidance on slide nine, we are reiterating our full year 2025 guidance, which includes core revenues to be in the range of down 0.5% to up 3.5% relative to 2024. Adjusted EBITDA is forecasted to be in the range of $735 million-$795 million, and adjusted earnings per share is estimated to be in the range of $1.36-$1.52 per share. These ranges incorporate the anticipated incremental impact of all enacted tariffs, which I will cover in more detail in a moment. Additionally, we still anticipate capital expenditures of approximately $120 million and free cash flow conversion to exceed 90% of our adjusted net income. For the second quarter, we estimate total revenues to be in the range of $845 million-$885 million and core revenues to be approximately flat at the midpoint. For the second quarter, we expect our adjusted EBITDA margin to decrease in a range of 10 basis points-60 basis points compared to Q2 of 2024. Recall that we had a non-recurring real estate gain in last year's second quarter that contributed approximately 80 basis points to last year's adjusted EBITDA margin. On slide 10, let's discuss our tariff exposure based on the current landscape and the associated mitigation actions we are implementing. Based on all enacted tariffs as of April 29th, we estimate our exposure is approximately $50 million for 2025. At the regional level, North America represents about $35 million of the tariff cost, and our exposure in China is approximately $15 million. The impact in other geographies, including the EU, is estimated to be immaterial. We intend to offset the majority of our estimated tariff impact with price actions. We communicated price increases to our channel partners in early April and expect price realization to match the timing of the incoming tariff cost. Furthermore, we are employing various operational initiatives to mitigate potential margin erosion from the enacted tariffs. Assuming the state of play as of today, we intend to fully offset the incremental tariff impacts estimated to be incurred this year and anticipate no meaningful impact to our adjusted EBITDA for the full year. I will now turn the call back over to Ivo. Thank you, Brooks. On slide 11, I'll summarize before we take your questions. First, we are pleased with the start to the year. Core growth was slightly positive, and our underlying operating performance was rather strong when considering the non-recurring positive items from last year's first quarter and the headwind caused by foreign exchange. Our gross margins continue to increase. Second, customer demand so far in the second quarter has been consistent with our initial guidance. However, we acknowledge there are potential risks to demand as the existing tariff regime becomes further entrenched. As such, we are tightening our focus on our compressible cost structure, such as SG&A and other spending. We have action plans prepared to implement should demand trends soften relative to our expectations. Third, I would like to reemphasize that our team is seasoned and has been through periods of business uncertainty in recent times. Our global teams are working closely together to fully mitigate the tariff dollar cost impact. Additionally, we continue to progress our enterprise initiatives, which we believe will structurally improve our cost base for the long term and help mitigate tariff headwinds in the short term. Lastly, I want to accentuate that our balance sheet is in a strong position, and we have significant capacity to deploy capital. We have over $100 million remaining under our existing share repurchase authorization and plan to be opportunistic deploying capital. Before taking your questions, I want to extend my gratitude to more than 14,000 global Gates associates for their dedication, focus on execution to our customers' expectation, and resiliency, especially during the spirit of macroeconomics and geopolitical uncertainty. With that, I'll now turn the call back over to the operator for Q&A. Thank you so much. At this time, I would like to remind everyone, in order to ask a question, press star and the number one on your telephone keypad. Once again, star one. In the interest of time, we ask that you please limit your questions to one primary question and one follow-up. Thank you. We will pause just a moment to compile the Q&A roster. It looks like our first question today comes from the line of Michael Halloran with Baird. Michael, please go ahead. Hey, thank you. Morning, everyone. Hey, Michael. Hey, Michael. Hey, Michael. Hey. Just on the tariff side of things, obviously, very clear messaging that on a dollar basis, you'll be offsetting the tariff impact. Maybe just talk about how that cadencing works out as you look through the remainder of the year. Is there any mismatch as you think about it into Q3 and then fully catch up by the fourth quarter? Kind of how does that dynamic play out? Secondarily, if you could add just how you feel about your competitive positioning all else equal from a global footprint perspective. Hey, Michael, I'll take the first part. I'll let Ivo take the second part. From a dollars perspective, we expect not to be negative in any quarter. We expect second quarter to be minimal impact. We expect third and fourth quarter to be matched pretty closely. Very immaterial impact from a dollars perspective. We do expect about a 25 basis point EBITDA margin dilution for the year because it is dollar for dollar, but no, zero dollar impact. No real kind of quarter-to-quarter impact that is going to be material. I'll let Ivo handle the second part there. Yeah. Let me chime in, maybe additional clarity. I'm sure that there's going to be a ton of questions around the tariffs, but maybe put a pin into it. Look, we anticipated about 75%-80% of the $50 million will be offset with price. So we got about 20%-25% that we anticipate to offset through operational initiatives and supply chain realignment. I'll remind you that we have done lots of supply chain realignment and reconfiguring post-Ukraine-Russia conflict. We feel that we are reasonably well positioned to be able to drive that forward. As to the competitive positioning, look, we have done a lot since, frankly, since Blackstone bought the company 10 years ago, we've started to position the organization for in-region, for-region manufacturing philosophy. We have been doing quite a bit. Let me remind you that in 2017, 2018, 2019, we've put a bunch of monuments in the ground and rebuilt our operational capacities. We have been well positioned. I feel that today we have one of the better footprints to be able to deal with the disruptions that we are seeing that were brought by this tariff regime. I think that we are competitively well positioned. I know that we are all focusing on some of the impediments, and there are impediments that we will need to operate through. That being said, we do also see a ton of new opportunities out there, particularly in the United States because we are well positioned. While we are pragmatic in our approach and we are focusing on operational cadence and offsets to what we see today through this regime, we are also being very agile in focusing on new opportunities in the marketplace. Yep. That makes a lot of sense. Appreciate that. Just maybe an update on where we stand on the internal initiatives, progress, and tying it to the current trends. I'm assuming the dynamics that are happening on the tariff side don't impact your ability to push forward with the internal initiatives. Is there an opportunity to pull that forward even more if demand softens? Maybe how does that correspond or interrelate to the tariff remediation actions you're taking? Yeah. I think there's a lot to unpack in this short question, I think, Mike. Let me say that vis-à-vis initiatives, the corporate 80/20-driven activities, we have had rather solid execution. I would say, in general, we are a little bit ahead of our schedule. That, frankly, filters in the gross margin performance. Again, another quarter of north of 40, 40% gross margin. We are well on track to deliver on what we've committed to our shareholders. We have done a ton of work on material cost out as a huge opportunity. You saw big progress last year. We continue on the trajectory in 2025, and we feel reasonably confident that we're going to see another year of strong performance here. The underlying productivity and price additive to what we are doing, so that all is helping out to offset these headwinds that we are seeing right now. Look, the footprint optimization that we have discussed, that's going to build on its progress as we continue to progress through the year. Remember, it really is a little more complex. It's not as, "Hey, look, we have a window, so we're going to pull some things forward." We have a scheduled delivery of new equipment that we are installing that, generally speaking, is fixed under fixed lead times. That's really kind of the gating item on your ability to pull anything forward. That being said, there are other things that are under control that we can manage through as we see more of these impediments being layered in. We can manage compressible costs. There is a ton of compressible costs across the company. We are tremendously focused on managing those, controlling those, and being very cognizant that we want to ensure that we protect our underlying operating margins. I know it is a long-winded answer, but hopefully, I have captured the essence of what your question was. You did. Thanks, Ivo. Appreciate it, guys. Thanks, Mike. Thanks, Mike. Our next question comes from the line of Julian Mitchell with Barclays. Julian, please go ahead. Hi, good morning. Maybe just wanted to start with a demand question. You have given sort of very good color on the geographic sort of trends. Maybe just thinking about the end markets for a second. You gave a good update on the end market expectations globally on the prior call. Just wondered how those have moved around since then. I suppose, in particular, sort of interested in the perspective on Personal Mobility, where it looks like a stronger start to the year than the full-year guide had implied. Also, any help you could give us on what is happening in the auto world at the moment? Not just demand, but kind of how are your products into auto, OE bracketed in terms of tariff classifications? Good morning, Julian. Again, a lot to unpack. Hopefully, you do not mind a long-winded answer in here, but let me try to hit on all of these points. Look, when we are, let's just kind of ground ourselves up. As the year started, we did not expect any meaningful recovery in the first half. It was for a number of different reasons, nothing to do with tariffs, obviously. We just were waiting for the PMIs to recover. We thought that we have pretty well bracketed a much slower recovery in the first half. I think that the general underlying demand is, frankly, not playing significantly differently than what we have anticipated. Yeah, there are some incremental headwinds now that I think everybody is getting more concerned and will obviously manage those. Q1 came a little bit better than what we expected. Q2 is looking very much in line with what our expectations are vis-à-vis order rates, exit order rates from Q1, and frankly, order rates that we have seen throughout April month to date. I feel that we are reasonably well positioned to support what we have just shared with you all. We've always anticipated now starting to hit on some of the end markets. Look, we've always anticipated that auto builds would be down. We felt, when we were coming into the year, that all the forecasts that were being done by the third party were a little bit too optimistic. We were much more negative on auto builds when the year started. The auto builds got a little worse, obviously, particularly exiting Q1 into Q2. It is more around the edges. Our sense was that the auto builds globally will be down around mid-single digits. What we are seeing now is more down high single digits. I would not be surprised if for the year, at least for the next couple of quarters, we see auto builds being down kind of around the 10% range year on year. We have kind of bracketed that in our forecast. Conversely, what we do see, and frankly, when we came IPO, that was kind of the pretext of our thesis, we see the auto replacement market being quite robust. When you take a look at even the reporting channel partners that we have had so far, the market is not that bad. They have reported positive store comps. We have reported rather robust AR performance with high single digits. I would remind you that that's predominantly on the back of the market share gains that we have had last year. Both of these are additives. The underlying AR market is rather okay. If you take into account the aging car fleet, employment is still rather okay. People still, they are going to probably cut flights, but they'll still want to go visit grandma and family. Instead of taking a plane, they'll drive a little bit longer. All of that bodes well for AR. We anticipate that that's going to be a accretive for the year. If I think energy, we had a muted outlook. Energy got a little bit weaker when you take into account the deceleration in price of oil and what I think is anticipated slowdown in the global economy. That got around the edges weaker. Off-highway, we felt that that was going to be kind of neutral. That is maybe down mid-single digits, so slightly worse than what we have anticipated. Construction and ag came in about what we've anticipated. Again, I'll remind everybody that construction and agriculture was rather negative, particularly in the second half of last year. The machine builds were down between 20%-30% in the second half. That not being as bad, but still being negative, is what we've anticipated. You could anticipate that that gets slightly worse. I think that taking into account how negative the off-highway ag and construction equipment performed last year, my sense is that it's going to be more around the edges negative, not dramatically more negative. That, I think, is kind of okay. The Diversified Industrial, Diversified Industrial hung in there. That came about flattish for the quarter. We anticipate that that's going to hang in there. I'll remind everybody that it was rather negative for seven to eight quarters in 2024 and 2023. The inventories are very lean in a channel. I think channel partners actually are performing a little bit better than some of the orders that we see and that we have seen. We have seen the incoming orders being slightly under what our channel partners are consuming. I feel that that end market is around the edges as we've anticipated and maybe leaning more slightly positive. The last piece is Personal Mobility. That came very robust. I know that maybe the first question is going to be pre-buys. We did not see any pre-buys from our channel partners. We have plenty of capacity. We have predominantly in region, for region in that end market. The biggest growth that we have seen came out of Europe and Asia for consumption in Europe and Asia. We did not necessarily feel that there was any pre-buy associated with that. I know I've given you a long-winded answer, but I wanted to make sure that I fully encompass in my answer the essence of your question. That's super helpful. Thanks very much, Ivo. Just one very brief follow-up. The sort of auto sector and auto parts has a lot of unique things going on on the tariff front and how things are classified or exempted and so on. Maybe just helps understand your own, it's a small part of the company now, high single-digit share of sales. Your own auto OE business, say, within the U.S., are those sort of classified within what we see going on with the broader auto companies in terms of tariff movements, or is it sort of different to them? Yeah. I apologize. I forgot that part of the question, Julian. That is not that big of a concern for us for the OEs because if I take a look at what we do out of our plants in Mexico for the auto OEs, they pick up in Mexico. We are really not responsible for whatever the tariff situation would be. Most of everything that we do in Mexico and in Canada for auto components is USMCA compliant as well. That is not that critical. We really do not export anything from the U.S. to Europe, as an example. I think that you saw it on that tariff summary that we have had in the slide deck that we have de minimis exposure in Europe, as an example, to any tariff. The auto components are very, very neutral for us vis-à-vis the OEs. Great. Thank you. All right. Thank you, Julian. Our next question comes from the line of Jeffrey Hammond with KeyBanc Capital Markets. Jeffrey, please go ahead. Hey, good morning, guys. Morning, Jeff. Just on the core growth, unchanged. I just wanted to understand some of the moving pieces there. One, kind of what's the magnitude of the price increases that you've announced? What incremental pricing do you have in the guide? FX, I think, was a two and a half, three-point headwind and $34 million on EBITDA. Just how were you thinking about that? I guess the offset would be lower volume. Right. Let me kind of walk through that. In our presentation, we talked about offsetting the $50 million of tariff impact with 75%-80% on pricing. We now think that, well, we're thinking that the other $10 million is going to be offset with operational improvements and supply chain changes and things like that. We did not change our guide from a core growth perspective. That $40 million kind of comes out of volume when you think about it over the balance of the year. That is what Ivo was talking about earlier in some of the weaker OEM, particularly around the automotive sector and then also the industrial sector. That is the offset there, right? I think from an FX perspective, we are seeing about 100 basis points less of a headwind than we initially thought. That filters through the EBITDA kind of in a normal fashion. Not as much headwind as we were thinking from an FX perspective. We based that on the end of March, end of Q1 rates. Those move around quite a bit, and those will flex through the year. We will update those impacts as things move around. They have moved around quite a bit since the end of the year up through now. We will continue to update those depending on what the prevailing FX rates are. Okay. Just to follow up, can you just quantify your manufacturing base in Mexico? Anything you can do to kind of inch up that USMCA compliance closer to 100%? Thanks. Yeah. Look, I think the things that we could do on the USMCA compliance is probably more around our manufacturing base in the U.S. We have some flexibility in terms of where we manufacture things. We have capacity that we've added, not just in Mexico, but also in the U.S., in new machinery and equipment and things like that. Depending on the tariffs and where we source things from and things like that, our biggest kind of flex where we can offset the tariffs, it's always going to be a cost versus the tariff cost, right? Internal cost versus the tariff cost is really take advantage of our U.S. footprint, which is still pretty substantive in terms of manufacturing. That's really what we're looking at when we talk about the $10 million of offset from a sourcing and operational perspective. That's what we're talking about. Can we do more stuff in the U.S. that's less impacted by tariffs and things of that nature? That's going to be the biggest thing we can do to offset or to kind of bump up the USMCA compliance aspect. Jeff, I would add that the USMCA non-compliance is really diminutive around the edges for us. I mean, it's almost immaterial in nature. What is the mix of your manufacturing base in Mexico? In Mexico, we manufacture every product that we manufacture in the U.S. We have full footprint on Power Transmission. We have a full footprint for Fluid Power. We can manufacture just about everything in Mexico that we can manufacture in the U.S., with the exception of mobility products. Mobility products, we can only manufacture out of United States plant. Okay. Thank you. Thanks, Jeff. Our next question comes from the line of Nigel Coe with Wolfe Research. Nigel, please go ahead. Thanks. Good morning, guys. Great color on the tariffs. Morning. It sounds like about two points of price coming through in the back half of the year. Is the plan to concentrate those price increases in the U.S.? Therefore, we're looking at maybe, I don't know, 4%-5% price increase in the U.S. Are you going to spread the love across the whole portfolio? That is the first part of the question. The second part would be, do you have material—material is the wrong word—but do you have larger competitors that do not have the same sort of local-for-local manufacturing footprint? Importing more into China or importing more from China into the U.S., less USMCA compliance in Mexico? Just wondering if there is any competitive differentiation here. Yeah. I'll take the first part of your question. Look, the pricing is really based on—it is not as regionally based as it is more what can we do to offset the sourcing, where we source from or where we make stuff from, and kind of what is the net impact that needs to be passed along, right? I would say probably a little bit more pricing maybe in the U.S. Really, that is based on just your ability to reconfigure your supply chain, reconfigure your manufacturing base, and then kind of the net impact of the tariff versus the increased cost, right? We are going to have pricing all over the world where we are impacted by tariffs. That is largely going to be based on both the supply chain aspect of it and the manufacturing aspect of it. Hopefully, that answers that part of the question. On the competitive positioning, Nigel, I would say that we are probably best positioned for manufacturing footprint. Again, as you saw from our quantification of the tariffs, I mean, for us, while I do not want to diminish $35 million of tariff impact on about $1.6-$1.7 billion North America base of revenue, it is really not that substantial. That just gives you an indication that we have a full capability to do everything in region for region. We predominantly are dealing with more of a raw material supply that impacts that number, not necessarily imports of finished goods into the U.S. Most of our competitors are foreign competitors. Many of them or some of them have some limited capabilities to do either some limited assembly or they have capability to build some of these products. We have very few competitors. I'd say maybe Parker in Fluid Power, I would say, is probably somebody that comes to mind that has a very similar footprint to Gates. Outside of that, I think everybody else is in a less favorable position than Gates Industrial Corporation and maybe Parker in Fluid Power. On the power transmission side, we just simply have the biggest footprint, and we are well positioned to be able to deal with this. We will continue to lean towards taking advantage of competitive positioning. Great. My follow-up question is just changing gears a little bit. I know liquid cooling is a very small business today, but it's got good potential. It does sound like that value chain is starting to crank in the gear. Just wondering if you're seeing that and any color there. Oh, yeah. Thank you for asking that question, actually. We have kind of omitted it from the update today, not for any other reasons other than we understand that there are some other more pressing issues. Look, we continue to have a really good growing engagement with a very significant number of new customers from server manufacturers, system integrators, all the way to the data center operators and hyperscalers. We feel pretty good at what's happening. We are in various stages of testing and validation of our products in these applications as we speak. I have just had a couple of reviews on our e-water pump that goes into data centers and are running a significant number of opportunities that we are in a position to capitalize on. We are rushing sample builds and validation of those samples. Frankly, interestingly enough, it's not just in the U.S., but it's in Asia as well. We've seen a rather nice step up in significant interest for our water pump, particularly in Taiwan and in China, as these companies, particularly on the ESM side, are ramping up build-out of more advanced white boxes and branded boxes in the server side. That is really exciting. We are in kind of final stages with a hyperscaler in validation of assemblies that have a very unique value proposition. We have not seen any slowdown, frankly, in interest. If anything, there's been a rather nice step up in the set of opportunities on which we are quoting or delivering samples. I'm quite confident that in the not too distant future, we're going to be talking about a business that is going to be ramping up rather than on opportunities that we are quoting or we are engaged in validation testing on. That's great. Thank you. Thanks, Nigel. Our next question comes from the line of Deane Dray with RBC Capital Markets. Deane, please go ahead. Thank you. Good morning, everyone. Good morning, Deane. Hey. Maybe we could talk about the channel, your channel partners, inventory in the channel, sell-in, sell-through. I appreciated that you called out early in your prepared remarks that you did not benefit from any sort of pre-buy. I trust that was in reference to the channel partner activity. Just what's your assessment, how you think they react during the course of tariff mitigation? Yeah. Thank you for the question, Deane. Look, we have not observed any meaningful change in behavior through the end of April. These channel partners, I think one of the pragmatic issues is that these folks are buying millions of SKUs, as you can imagine. I think it'd be rather difficult for them to pull demand forward. Maybe they would do something on some critical components. The availability of our products on a short cycle is very good. Our service rates are very good. The cost of our products in a system is, frankly, still de minimis despite the fact that we offer mission-critical support in applications. We have not really seen any meaningful pull forward. When I take a look at the sales-in versus sales-out statistic from our major channel partners, we have been very much in balance with sales-out. I would say maybe even around the edges, we are underselling into the channel versus what we are seeing with our channel partners' sales-out. That would tell me that from the data that I see, there has not been any meaningful change in behavior. That being said, look, we are a super short-cycle company. If things change, we will see them change. I have characterized that through April, we feel reasonably good about where we sit. The demand is very much in line with our expectation, both from our original assumptions as we were coming into the year, as well as with how we have quantified the second quarter guidance today. Great. Any line of sight on new channel partners you might be adding? What is the update and status on the latest one that you added? The latest one we are fully ramping up. We should be completely ramped up with that channel partner within this quarter. From the second half of the year, it is going to be more run-rated state of business. There are still some other opportunities for other product lines that we can secure that we are working on. I am not in a position to be talking about any other incremental channel partners. As I said, as a part of my answer to Nigel, I think that we will have incremental opportunities. We will let you know as we are capturing those opportunities into the future. Thank you. Thanks, Dean. Thank you. Our next question comes from the line of Chris Snyder with Morgan Stanley. Chris, please go ahead. Thank you. I just wanted to follow up on the commentaries around potential pre-buy. I know it's probably hard to always know exactly what's happening. I guess what gives the company confidence that there wasn't any pull forward in Q1? I ask because it's the first quarter of positive organic growth in a couple of years. Would you guys attribute that improvement in growth just to the new customer wins in the quarter? Thank you. Yeah. Chris, thank you. Good morning. Thank you for your question. Look, I will come back to my answer that I just provided to Deane. I can only look at the data that is available to me. The data would indicate that actually we were probably around the edges, a little bit behind with receiving orders and selling into the channel, taking into account the sales-out by channel partners. In the U.S., we actually have a reasonably good visibility to that because most of our large customers are public companies, and we have good agreements with them. We receive weekly and monthly data on their sales-out into the end market. That data would indicate that we are very much in balance, and inventories have not built out. We've talked about inventories in a channel coming out over the last eight quarters or so. Absent of that, the data would indicate that channel sales were balanced, and there was no pre-buy. The second part of your question, hey, what caused you? The second part of your question associated with what has driven the positive core growth? Look, first of all, I think we were reasonably pragmatic coming into the year. We really did not anticipate that it is going to be a super jazzed-up year. We thought it is going to be a muted end market environment. I think I have delineated to excruciating detail what is happening in the end markets to Julian's question. We see behavior that is more in line with what we have anticipated. We have had better performance out of Mobility. Mobility had seven negative quarters of growth. That inventory has depleted. We have delivered a very strong growth in Mobility. The second part of why positive growth is we have taken market share. We discussed last year in AR. We continue to see very constructive end market behavior in Automotive Replacement, not just here in the U.S., but in Europe, as well as in China. All three of these regions have continued to grow. Our business in AR is growing nicely in India now as well. We have done just slightly better. I tell you, I'm not high-fiving that we have delivered 1% core growth. We really would like to see much more robust growth. That is going to be challenging taking into account the present economic macro. Thank you. I really appreciate that thoughtful response. I guess maybe following up, are we right to assume that the price increase that you guys are pushing through is more of a Q3 event than a Q2 event? Any color on that is helpful. Thank you. Yeah. Look, from an implementation perspective, it's a Q2 event. From a realization perspective, it really doesn't impact Q2. It starts to impact Q3. It's really well matched with how the costs of the tariffs are going to come in, right? I mean, we're sitting on about a quarter of inventory, and that'll flush through in Q2. We've implemented all the price increases. We've talked to all of our channel partners. They understand what's coming. That'll start to come in in Q3 as well. Like we said in the prepared remarks, the tariff impact is a relatively de minimis event in Q2. We'll really see that in the back half of the year, both the cost impact and the price impact, and then most of the dilution impact we'll see in the back half of the year, the EBITDA dilution impact. Thank you. I appreciate that. Thanks, Chris. Thanks, Chris. Our next question comes from the line of Andy Kaplowitz with Citigroup. Andy, please go ahead. Hey. Good morning, everyone. This is actually Jose on for Andy. Hey, Jose. How are you? Good. Maybe to start, you kind of touched on 80/20 in an earlier question. Putting it in here, could you give us an update on how the implementation has been progressing? If you're planning to accelerate that in 2025 to offset the potential margin dilution from tariffs, you've talked in the past, North America is fully on board with the front end, and you're making progress on the back end. There's still plenty of runway in Europe, which could help you offset some of the weakness in that region. Any color here would be helpful. Look, 80/20 is becoming a central part of our operating business model and kind of operating DNA. We're making good progress. We're making measured progress in 80/20. Again, I'll reiterate what you said. North America, good progress with front end. We're now starting to address the back end in the operations. We feel we got a ton of opportunities there. It's really quite actually, it's quite interesting. It's super powerful in the operations where we deploy on specific cells. You see a rather substantial jump in productivity. We'll be pretty focused in driving it across our factories in North American footprint. We anticipate that we'll start pulling 80/20 into the back end in Europe as well. We view that as certainly a lever that will be accretive to us to deal with the macroeconomic challenges. I'm not going to be sitting in here and telling you that we're going to do better or we're going to do worse. I think that we are laser-focused. This management team is super focused on dealing with the impediments that are ahead of us. We are all pretty sober about it. We know that things change, and they change every day. This has been one of the most difficult, most challenging seven to eight weeks that we have had since the announcement on April 2. Our management team is working super hard. All of our employees across the company are laser-focused on dealing with this. We are fully committed and fully on board to drive the best result for our shareholders, for our customers, and for all of our stakeholders across the company. Thank you. Maybe a quick one in terms of capital deployment. You guys finished the quarter with a net leverage of 2.3. You have talked about being able to reduce your leverage by half a turn in the year just based on your cash conversion, which would put you within your one to two leverage target. You have talked a lot about the organic investment and the share repurchases remaining in focus. I am just curious if you could talk about what you are seeing in the M&A environment. Yeah. Look, great question. I would remain consistent with my answer. Our stock is super cheap. We will continue to be opportunistic in utilization of our $100 million-plus authorization that we have outstanding. I think that we will certainly anticipate to lean into that lever. We, in general, deliver very strong free cash flow generation in the second half of the year. We certainly see an opportunity to continue to deliver and come close to our metrics that we have committed to our shareholders. We see a really nice set of opportunities to do M&A. Before we would be doing any transactions, we've got to make sure that they will be accretive to our long-term strategy. We will certainly be cognizant of the fact that any potential transaction would have to deliver double-digit ROIC by year three. That is non-negotiable from our end. While we see opportunities out there and there are some really nice assets that are available, we're going to be very disciplined. We have a great company. We have a terrific strategy. I think we are executing on a trajectory that we have committed. We're not under any pressure to be doing any deals that would potentially derail what we have envisaged here. Yeah. Let me add to that. Last year, we did a lot of really, really good work. In fact, probably, I would say best-in-class work around our balance sheet and our debt structure. We do not have any big principal payments due until 2029. We have locked in a pretty favorable interest rate structure in terms of what our fixed versus variable is. We are confident in our cash flow, our ability to generate cash flow. Where the stock trading is today, we still have over $100 million of authorization on share buyback. In the short run here, given what is going on in the economy, that is probably where we will lean into here over the short term. We are confident in our ability to deliver. We have done it over time. The opportunity set for us right now is probably more on the share buyback side. Thanks for the time, guys. Thanks for that. Thank you. That does conclude our Q&A session today. I will now turn the call back over to Rich Kwas for closing comments. Rich? Yeah. Thanks, Craig. Thanks, everyone, for joining today. If you have any follow-up questions, please feel free to reach out and have a great rest of the week. Take care.