I haven't done it today. No, I know. All right. Good afternoon again. We're excited to have Ingersoll Rand with us. We've got really all the senior managers here. We're very excited. Now we've got Vicente Reynal, who is the Chairman, President and CEO. We've got Vik Kini, who is the SVP and CFO. We've got Mike Weatherred, who is the SVP of IRX. As I'm walking over here, Vicente, I'll say, like, we're essentially three years post- RMT. You know, I remember, you know, you, I think, closed the RMT right before the pandemic. We were still at our conference here in February 2020. Maybe you can talk about sort of the progress over the last three years. You initially came out with $250 million of synergies. Now you're at $300 million. Can you give us more color on sort of what's gone right and, you know, if anything's gone wrong? Then there are clear reasons for the RMT, you know, revenue synergies, marrying GDI innovation with IR distribution. Maybe talk about what actually has happened. Yeah, yeah. How about a six-part question to start with? Sorry. I think it's been an incredible journey, Andy, and thanks to obviously our employee base who are, you know, have this ownership mindset, and we can talk more about that later. It's very impressive too as well to think about that when we announced the signing of the transaction, we said that we could become a $1.6 billion EBITDA business, right? Remember we said at the time it was $1.4 billion plus $250 million. Mm-hmm. Look at what we have done now. Yeah. I mean, if you look at our guidance, we are there. Mm-hmm. We're there even when you think about that, we basically divested, you know, over $1 billion of revenue and a lot that went with that EBITDA by Club Car and the high- pressure oil and gas business. Again, I think it's pretty remarkable what as a team we've been able to accomplish. It's all thanks to the team members that we have in the company. I think the most exciting thing for me is that immediately we were able to create a single culture. Today you don't see Gardner Denver culture or Ingersoll Rand culture. It is one single culture. The best way that our employees like to describe the culture is that, you know, they think that they view it as we are in a 160-year-old startup company. Mm-hmm. A lot of agility, a lot of nimbleness, a lot of entrepreneurship, we're just very focused on ensuring that we make life better for the customer, the planet, the employee and the shareholders, which by the way, all the employees are the shareholders. I think a lot of great things. I could, as you can imagine, I could talk here for hours. Yeah, we could fill that with one question, right? Yeah, that's right. All right. Maybe just following on there, Vicente, like, you know, as you've assessed your market share performance over the last three years, you know, would you say you've taken share? You know, if so, where? Sort of related to that, you know, it does seem like you've talked a lot about demand generation, and those efforts have sort of ramped up into a really differentiated growth driver. Maybe talk about that and maybe the maturity of demand generation efforts. Like again, to use an American analogy, like, what inning are you in? Sure. Demand generation? To that, absolutely. We feel that we are taking share because when, clearly we compare our growth rates compared to those that we can see externally, we're outperforming, the growth momentum. We feel it. We see it in terms of, some of the product categories, whether you may think about, you know, could be, you know, oil-free that we said is very important. We're seeing that oil-free continues to outgrow oil lubricated compressors. We like that because oil-free penetrates more these high growth, sustainable markets like food, beverage, pharma. We definitely like what we're seeing. To your point, we think that a lot of this has been done via self-help. Self-help, we like to call it as utilizing demand generation, which is our commercial execution engine on how we go about instigating demand from our customer base by utilizing the same techniques that many of us will see on direct to consumer, but applying that into the industrial space. Mm-hmm. Today, you know, we easily generate, you know, 5,000 marketing qualified leads every single week. Mm-hmm. That's giving us just an incredible amount of visibility and performance in terms of where is it that we can accelerate our growth. To your point, I mean, this was non-existent, I'll say five years ago. We have done an incredible job ramping that up. And in terms of innings, we still feel we're at the very early inning stages because the focus was a lot on the ITS segment and we're moving now a lot of this demand generation focus to the PST segment. Again, we see that's going to be a new leg of growth that we can accelerate from a demand gen perspective. Got it. I wanted to ask you about, you know, you mentioned sort of the entrepreneurial culture. I think, you know, it's very unique, very important given the owner philosophy. How do you think that's translated? You know, obviously you mentioned cultures, you know, sort of combined. What is, you know, has it translated well, you know, to the overall bigger IR now? You know, cash was under a bit of pressure in 2022, as you know. You're not alone in that. How has, you know, the owner operator sort of culture helped and how do you expect it to help with getting back to 100% or over conversion as you go forward? As you know, Andy, and many of you know, but just to as a background, I mean we, you know, every employee in the company has an ownership in Ingersoll Rand. We did it back in 2017 when we awarded about $100 million of equity across, at the time, 6,000 employees. In 2020 when we closed the transaction with Ingersoll Rand, we gave $150 million of equity to 16,000 employees. Mm-hmm. This was given to non-management equity participants. This was to put the equity back into all the way down to the factory hourly workforce. What we did is we trained everyone and we said, "Hey, this is not, this is not a thank you note. This is, yeah, I mean, we might be good guys and nice guys, but we're not doing this because of that. We're doing this because we want you to have skin in the game in our long-term journey strategy. We train everyone, and we taught them on what is our long-term strategy, where do we see the growth vectors, how do we see the company moving over the next three to five years horizon. One of the things that we said is that as owners of the company, we need all 16,000 employees to focus on cash. Mm-hmm. Cash conversion cycles. We were training, and we train all 16,000 employees in local languages on what does it mean, how can they unlock cash? Mm-hmm. Yeah, I mean, that has turned, you know, big improvements. I mean, last year, free cash flow positive every quarter. Mm-hmm. We have been free cash flow positive every single quarter since the combination of the merge, and we still see plenty of room for us to continue to improve that. Whereas, you know, we said at Investor Day, mid-teens free cash flow margin, and that's, you know, a very easy path for us to get there on a continued basis and get that to a higher number. Got it. No, that's helpful. You've continued to highlight sustainability as a growth driver for Ingersoll. Maybe talk about how the portfolio is positioned today in terms of helping customers achieve their sustainability goals. How much might U.S. IRA sort of accelerate that focus? What are you working on to further differentiate your offerings on the sustainability side? Yeah. so if you step back, I mean, you can consider us that right now, Ingersoll Rand, we're a pure play in mission-critical flow creation devices, compressors, blowers, vacuums, pumps, anything that is mission-critical in nature, where we are the heart of the process. Mm-hmm. That means that we can make a difference in energy savings and water conservation. We're very focused on ensuring that a lot of our technologies are helping doing that. Best example is compressors. Mm-hmm. Compressors are consuming roughly 30%-40% on average of the energy consumption in a typical application. Our technologies that we continue to launch every year continue to reduce that. In addition, you know, we created new service, and with the use of our remotely connected compressor technology, we're able to monitor that and actually reduce our the energy consumption by fine-tuning the compressor even remotely. We don't have to do that, and we do that for the customer. When you look at the product portfolio, we like to say that, you know, 30% of our revenue is related to water conservation. Mm-hmm. Almost 100% could be related to energy conservation because, again, you know, a great example here will be our Runtech business, which is a Turbo blower technology for pulp and paper industry that eliminates or reduces water consumption by more than 90%. Mm-hmm. energy consumption by over 50%. Mm-hmm. In a pulp and paper industry, which is very high energy intense and high water consumption intense. There's a lot of technologies that we have. To your question about the IRA, really honed in on very good specific areas. Mm-hmm. We see renewable natural gas here in the U.S. as a growth vector for us. We're seeing, you know, with our technology for gas compression, great penetration there and great momentum. As we would like to see, let's see what happens with these hydrogen hubs. Right. We're particularly very well- Right. positioned to play on that. Carbon capture, you saw that we announced, here on the earnings call a very large and sizable carbon capture project that we got awarded, and we're very well participant. Just one follow-up there, Vicente, because you mentioned hydrogen hubs. We are building them. Like, how long does it take from, like, when you build them before you guys sort of get, like, an order, you think? That'll take some time. Yeah. I mean. Is that, like, a 24 thing? Could be 2020, yeah. Not 2023, yeah. Okay. Not 2023. Yeah. If anything, perhaps- Even later than 2024 or 2025. Yes, that's right. That's right. Because we are building them. It's just a question of- Yeah, I think for us, what we always said is that if you remember at the Investor Day, we spoke a lot about hydrogen, particularly for ITS and PST. Yeah. PST was about the refueling stations, and we said those start in Asia Pacific, and in 2021. Yeah. We saw good momentum. Yeah. Later we're now seeing that momentum in Europe, which we said that was gonna be next. Eventually here in the U.S., whether they select, liquid or gas hydrogen. Yeah. It depends, and then that will tell a lot. Yeah. One more question on sustainability, because I feel like you guys kind of talked about it before it was in vogue as much, you know, like, if I go back a few years ago. Like, customer sort of focus on it, you know? How much has it accelerated? What's hard to understand, right, is separating the macro from, you know, demand generation versus customers accelerating focus on energy efficiency and sustainability, which is a big deal for you guys. Mm-hmm. Investors all across the business. How much is it that customers are accelerating the focus on sustainability and energy efficiency? We see it, Andy, and we see it across from a global perspective, customers talking more about it. Yeah. not only just talking, but just taking action and really allocating CapEx to be able to execute. Right. Be able to achieve their 2030 and 2050 greenhouse gas emissions as they relate to Scope 1 and Scope 2. Clearly, you know, when you look at the sustainability reports from a lot of public companies now, they specifically call out compressors and air treatment systems as the way to get to that Scope 1. So it is a reality. We still think that it is definitely early innings from that perspective. Yeah. as everyone kind of starts executing that plan. Yeah. In place, we think this could be a good tailwind for us as we kind of move forward. Yeah. The other exciting thing I'll say, Andy, about sustainability, I don't wanna miss this one opportunity to talk about, you know, that last year we were added to the Dow Jones Sustainability Index. Mm-hmm. It's not only about the products that we make, but also how we as a company are dramatically changing. Yeah. Two years ago, we were completely unranked. Now we're number one in our category in North America and number four in the world. Yeah. Pretty dramatic change that the teams have been able to accomplish. I want to follow up with you on European orders, because I think it's tied to sustainability. I want to talk about to the SVP of IRX in a second, too. Just if I could ask you, Vicente, like, your orders in Europe have held up quite well, right? Again, everybody's worried, everybody was worried about a cold winter. It didn't develop. How much is it, you know, cold winter didn't develop, so the economies were okay versus, again, demand generation, more sustainability focus. Like, how do we sort of unpack your order resiliency in Europe? I know you talked about book to bill, you know, close to one this year, all that kind of stuff for the overall company, and we'll get to that. How do you look at Europe for you guys? Yeah, yeah. I'll say at this point in time, we continue to feel that it is these self-help commercial actions that we're taking with the demand generation and educating customers about energy reduction and how our products can help them on that journey, and doing air audits and going into the facilities and leveraging a lot of that. I think it's a lot of that big push. Earlier in 2022, clearly when the situation happened with the energy costs rising, a big surge in how can we help customers. We still see a lot of that conversation even though, you know, energy has become to that level. Because again, it's still projects that customers need to execute for their sustainability targets. Mm-hmm. We still think it's a good momentum really driven by our demand gen growth engine that we have. Do you think that book-to-bill can be around one in Europe specifically this year? We don't see why not. Yeah. Okay. Mike, if I just could ask you, like it's great that you're here, you know, you've been able to navigate, you know, significant supply chain headwinds, you know, over the last couple years, I think pretty well versus others. Maybe you can talk about, you know, how IRX has been so important to help you achieve your organic and inorganic goals in the current environment, and what kind of visibility it gives you for the future. Great question, Andy. I think that I would say anytime I get to talk to a group like this, I'll bet nobody came to this breakout hoping to hear about an operating system. I know you hear a lot of junk, and you see a lot of movie sets. The thing that I would say for us is we used IRX for the integration planning. Mm-hmm. Going all the way back to the RMT. We had our level one team. For example, Vik ran the finance swim lane, et cetera, et cetera. When you think about that, we had the $250 million target, we chunk that up by area of focus, we set 100-day goals, we build a bridge of an X- to- Y, we think about what are the headwinds and what are the areas of focus, we just execute. Mm-hmm. We execute in what we call swim lanes, where we set 100-day objectives. We try and measure the leading indicators, and we talk about it on a every seven-day cycle. Mm-hmm. At the time of the RMT, we had about 70 of those processes running. We call them Impact Daily Management. Today we have about 300. Wow. If you think about... There's usually about 12 - 15 people who participate in those sessions. Some people go to two or three a week, but you think about hundreds and now thousands. We think there's about 6,000 people that participate on a weekly basis. What they're basically going through is a process where they set a 100-day objective, think about some standard work they're gonna go execute on, what they're gonna measure from a leading indicator standpoint. So for sales, we're not gonna measure bookings, we're gonna measure things like sales calls, sales quotes, funnel size, et cetera, et cetera. Then on a weekly basis, the first thing they say is, "My 100-day objective is, and I'm in control." In control means I'm gonna achieve my 100-day objective. I'm out of control, which means right now I can't see it, but I'm still working on it. Mm-hmm. again, in a 13-week cycle, you're gonna get red, red, and then somewhere around week four, five and six, they start to come into control. Mm-hmm. Back to your question around things like supply chain challenge, it's the perfect, you know... Bad news is actually the perfect application for the tool, because you're gonna take that bridge mentality, and you're gonna look at those headwinds head on. Now, to our team's credit, I wouldn't give IRX a ton of credit for bullying their way through it. I think that was, that was daily management, that was hourly management. That was staying on top of it and focusing on it, almost minutely from the time that we saw it coming. If you think back to where we were, we weren't only in a headwind challenge from a cost going up. We were in a headwind challenge from a publicly committed $250 million target, of which, you know, Vik could tell you the number, but it was the large percentage of that $250 million. I think the beauty of the process then is talking about it every seven days. It's not something that we deploy down into level three, four, five, and six. We're all in, the three of us. Vik runs an IDM for finance, runs several IDMs for IT. Vicente, he calls it his staff meeting. It's really an Impact Daily Management meeting on Friday, it's a 60-minute tour around the world across the five BUs, across all the functions, including supply chain, where we're looking at probably a dozen KPIs in the supply chain and what's happening on a six- or seven-day cycle. The other thing that I don't wanna leave out is the last part of that script at the swim lane is, "And I need help," fill in the blank. Mm-hmm. Again, in a six or seven-day cycle, in week one through, say, five of a 13-week cycle, you get a seven-day chance to ask for help. Help is, I mean, nothing gets responded to faster than a request for help from an Impact Daily Management meeting. I think it helps us tease out exceptions. Mm-hmm. problems really quickly and then act on them equally as quick. Yeah. I'll say the thing to add to as well, Mike pointed very well, is that how news travel up and down really fast. Mm-hmm. In the supply chain, when we were at the peak of that environment, in the asking for help, it was asking for me to call other CEOs to see how can we unlock- Exactly. those castings, chips, whatever supplied is that we needed to. Mike or Vicente, just two follow-ups. Like, one is like, obviously, most of us know where you came from. When we think about the Danaher Business System, a lot of times it gets lost in translation. You know, again, I'm not saying that yours is exactly the same, but like, you know, it goes to different companies, it kind of gets lost, and the idea of continuous improvement sort of gets very complicated. How do you keep it simple? You talked about, you know, 6,000 things going on. It's like, how do you keep it simple and directed? How does it help? Because you guys have been very inquisitive still over the last year when a lot of other companies haven't. How does IRX help you do more or inorganic things? Yeah, I'll take the second one, then I'll let Vicente take the first one. From an integration standpoint, it's the perfect tool. What I mean by that is we use the same sort of IDM or swim lane philosophy when we're planning for an integration. About 60 days prior to... I'll use SPX as the most recent example. Mm-hmm. In probably middle of October, we started an IDM process across all the functions, planning for the SPX integration, which happened on January 3rd, 2023. Mm-hmm. This is how it gets better over time. We've been running that for probably four or five years. Mm-hmm. Now we've gotten it down to a precision level where there's 23 things from payroll to culture and IT availability, P-cards, everything in between. 2023 key deliverables that we want to deliver on day one for a successful integration to get momentum. Mm-hmm. I think, again, you know, the beauty... We've done 30 transactions since the RMT, so we've gotten 30 laps around that track, and every single one of them is better because we learn as we execute like that. We, in due diligence, we're going to form a plan for what good looks like from an integration standpoint, including synergy capture and revenue growth. We're going to execute on that for 75, 60, 75 days. On January 3rd, 2023 I mean, on January 3rd, 2023 things started happening in a big way. We did a monthly business review with SPX FLOW 2 weeks ago, and that was for the month of January. They're 30 days in, 45 days in, 30 days of results in. It did not look like an exception to the rest of Ingersoll Rand. Mm-hmm. I think there's really three reasons for that. One is that our people doing that, people like Vicente Reynal, Matthew Fort, other people that have been working on these integrations now for years, they know how to help, and they know how to prepare, and they know how to wire the systems together. The second thing is that in using that process, now SPX FLOW will start to run Impact Daily Management on their own because they've gotten the reps as it's been handed off from integration planning to integration execution. As they reach that first 100-day mark, they'll sort of, you know, we'll let go of the string, and they'll be off to the races. The third thing is that I think with that level, there's probably 50 people that have... I'm talking about 50 senior people that have played a huge role in planning for and now executing on that integration. SPX FLOW feels very welcomed. You know, they're told they get to keep their brands. They're told they get to become owners of the company. We're not telling them really what to do, which is, gets to the first part of your question around DBS. This is not about the what, it's more about the how. Mm-hmm. They get the tool, they get the reps, and they're off on their own. I think on the first question on how do we keep it simple, and I try to keep it simple, but it really starts with first of all, defining our strategic path for the next five years. You can easily see that on our economic growth engine. We actually show that on the Investor Day, but we also show that on the last earnings call, and we'll keep continuing to update that. Because that defines where we want to be. We said, you know, we want to grow organically mid-single digits, inorganically another mid-single digits, and obviously over the from now until 2025, and see how, you know, obviously through the use of IRX. Yeah. -and other methods, be able to deliver double-digit earnings growth compounded. We take it as to, okay, that's the where we want to be, and then we also surround ourselves with the best possible people. I mean, it's all about having the team. Not only the team that is here, but the team that is in our, in our locations, but also our board. Mm-hmm. When you look at our board, we have phenomenal board members. Very specifically attracted board members at Bill Donnelly from Mettler-Toledo. Mettler-Toledo, you know the story, which has been very, a very amazing tech story over the past, you know, 20-25 years and still continues. Mm-hmm. We have a board member from Roper Technologies with John Humphrey, obviously all of us here know that phenomenal story of transformation. Mettler was organic, Roper was inorganic transformation. We also have a board member from Thermo Fisher, which obviously again is a combination of organic and inorganic. What we have been able to do is really take a lot of the learnings from obviously where we came from. Mm-hmm. At the same time from Danaher, which is a phenomenal company and incredibly successful, but also take the learnings from Mettler-Toledo, take the learnings from Roper, from Thermo, and apply that into a very simplistic tool. How do we execute? How do we find a good way to what Mike said about those 100-day game plans. Mm-hmm. That we take the five-year horizon that we have and translate that into weekly chunks. Yeah. that the teams can execute across the world. Got it. Let me focus a little bit more on the short term. You just reported earnings yesterday. It seems like what you said yesterday was, you know, you still feel pretty good because you sort of guided to build around one, as I said, for the whole company. It seems like you're gonna, you know, if conditions kind of remain the same, end 2023 was still pretty strong backlog, and that would actually set you up for 2024. Maybe talk about risk factors you see there, you know, but in general, that's kind of the message I got from you guys yesterday. Yeah. I think that's spot on. You know, I think the way we think about the year and, you know, as we think about the guidance, we said, you know, about 3%-5% organic, FX is a little bit of a headwind, mainly in the first half of the year. We have a nice tailwind with the inorganic, so about $270 million of revenue growth embedded in the guide from M&A, the biggest piece of which actually is the SPX FLOW transaction. You know, I think in totality, pretty pleased with, you know, how we have set up the year as we move into 2023. If you think about kind of where we're starting, and we mentioned this yesterday, One, we're starting with a very healthy backlog. You know, backlog continues to be about 30% up, you know, versus prior year. It's, you know, roughly speaking 1.5x, you know, 1.5x+ bigger than what we'd call more historical norm. It's giving us more visibility as we walk into the year, which is great. In terms of the organic piece of the guide, that was call it midpoint of 4%, we did say about 70% price, a meaningful piece of which is coming from the carryover. Really actions already taken through the duration of 2022 will carry into 2023, largely through the first half of the year, and then the 30% roughly being volume. If you think about kind of the way the year is playing itself out, and we talked about this as well yesterday, you know, it does set itself up for, you know, more, you know, the implied guide is a little bit more flattish on the organic side in the back half of the year, which I think right now is, you know, prudency as we look at the balance of the year, much like you saw in 2022. You know, we would say that, you know, the piece that we would consider, say, you know, potentially hopefully as upside opportunity as we think about the back half of the year would probably be that organic volume side. Right. Not too dissimilar from how you saw in 2022. Interestingly enough, here in Q4 of 2022, you saw some nice outsized revenue growth, particularly in the ITS side, really coming from a lot of that organic volume. Again, I think that's kind of the way we see things setting up. Yeah. We're gonna continue to be very disciplined, very prudent. You know, as we talked about here, this is kind of the final year of some of those merger-related synergies. Yeah. We have more than that in terms of productivity. It's also worth noting, embedded in our guide is a, I'd say the requisite amount of reinvestment in a lot of our, we'll call it commercial growth type, tools, whether that be at the corporate side, IoT, demand generation or commercial resources within the business. To your point, you know, we wanna be here every year talking about that outsized organic growth. Yeah. We wanna make sure we have the right levels of investment to drive not just organic growth in the next 12 months, but for the foreseeable future. Yeah. I already asked you, Vicente, about European orders. You know, I've gotten a question already about your North American orders. 'Cause, you know, you talked about the lumpiness yesterday as you're getting a little bit larger projects and one, you know, bigger one slipped into Q1. But like someone said to me, "Well, you know, Copco had pretty weak orders in small- to mid-size compressors. You know, is it really, you know, lumpiness or is it kind of weakness?" Like, how would you sort of respond to that? I know it's- Yeah. I think the best way to think about and to maybe smooth out some of the lumpiness is just look at the first half to the second half. For the ITS Americas, which is primarily the U.S., you'll see that there was organic growth from the first half to the second half of roughly 5%. Basically continuous acceleration. Mm-hmm. It was also because, again, Q3 was a very robust orders growth number. I think it was over 30% growth that we saw in the Americas, book-to-bill over 1.2. Mm-hmm. I think it was just that. I mean, that basically the timing, and I think it's just one of those that, again, when we look at the next leading indicator for us, which is the marketing qualified leads, still very stable and very good momentum that we see. What we like is that there's also a lot of the tailwinds that we just talked about. Right. With IRA, that we're seeing it already, some of them come through fruition. To be clear, you talked about, you know, orders being positive in January and so far in February. That's right. As we said on the earnings call, yeah, between January, I mean, the first five weeks, you know, total orders and also by segment, we were positive organically on a year-over-year basis. That's also thinking that Chinese New Year basically is a headwind. Right. We're not excluding that. That's all in. Again, it shows that, you know, there was actually good continued momentum here. I think China's been pretty good for you. Like, have you seen a pickup post-Chinese New Year, or is it still too early to kind of call that? You know, Chinese, even through the Chinese New Year, we actually that was the biggest surprise for us is that we continue to see that kind of good momentum. Post-Chinese New Year, yeah, I mean, the team is very excited and the momentum there continues. I think this is a very, again, talk about self-help growth again. Yeah. This is one where the team localized and developed an oil-free compressor for China, in China, for China. Yeah. That we're now taking and actually using, utilizing globally, blowers, vacuums. Yeah. The Kinney acquisition that we made a couple years ago, we're leveraging that to put that in China, and the team is seeing that growth on that. It's, it's a great story. What gives you the confidence in North America? Is it more the long cycle, the 20% of your business, the larger compressors that are starting to ramp up, and they're gonna take the place of small to mid-size? Like, how do you know, get the visibility there? I mean, I think one thing is that we have never been a big player in that small kind of compressor level, as others have been. We're kind of more medium and now obviously with the acquisition of Ingersoll Rand also on the large side. I would say, yeah, the confidence comes in from NQLs to be able to drive what we call the short cycle orders. Okay. How we see it stable there. When we look at the funnel of the projects that our teams have on the longer cycle, that is also the pretty exciting thing that we see these kind of tailwinds. I don't think people asked you this yesterday, Vicente, I might be mistaken, but like Buffalo, I think you said a few quarters ago was kind of full for like all of 2023 or something like that. That's right. You continue to push that out, you know, into 2024 now? That's large compressors, right? That is multi-stage centrifugal large compressors, yes. Yeah. That they're used more onto, yes, large air-. They go into like auto, LNG, like things like that? They're going in, they're going to semiconductor. They're going to actually use also for hydrogen for steel industry. It's a lot of basically, you know, U.S. applications. A lot of what we call onshoring applications. Okay. I wanna open it up to the audience. Maybe I just ask you about price versus cost briefly. Yeah. Like, again, you seem pretty positive about it, you know, yesterday, like, you know, stickiness of pricing, you know, clients have started to come up again. Is it sort of normal price increases this year? Like, how are you guys thinking about all that? Yeah, price cost continues to be... I mean, I think we've been price cost positive for every quarter. Yeah. We expect that to happen. As deflation. Our guidance assumes no deflation, even though clearly we're working with suppliers to get that. Because of the inventory sizes that we have, we may not see that kind of come through in this year. That might be upside as we kind of maybe go into 2024, which is great. Mm-hmm. Because when you think about 70% of our cost of goods sold is direct material, so it's a big improvement area that we always work on. Yeah, no, so I think we continue to see good momentum. In terms of new price, yes, we have some carryover price. As Vik said, you know, 70/30, 70% of the growth comes from price, and a good portion of that is carryover. We still this year will do, you know, kind of more normalized price, 1%-2% at this point in time. If we see that later in the year, we need to do more, easily, we can do more. That's the view. Got it. Let me ask you about Precision & Science, and I'll open it up. Like, that business, like, seems like there's still a little bit of a pandemic hangover, call it. You know, like, orders are still down this past quarter. Mm-hmm. Mm-hmm. I mean, you mentioned that they were up, you know, I guess in the first five weeks. Have we turned the corner there? Like, what's going on? Can we get back to high single-digit growth, which I think you said is more normalized order growth? Yeah. 2021 was a pretty unique year because 2021 we saw a lot of outsized growth because of COVID, clearly oxygen concentration and other ventilators and things that are related more on the medical side. We saw the initial big wave of hydrogen. Mm-hmm. As we said, the New Zealand countrywide expansion, Korea and many other orders that we saw also in 2021, that for the majority of part did not repeat because these are kind of one large projects that take a long lead time to get produced and then implemented. As we go here into 2023, 2024 and forward, we expect to see more normalization of that. Mm-hmm. Clearly these hydrogen, if we get it, these are large orders, and they might create a bit of lumpiness. Mm-hmm. again, these are orders that lumpiness that are good because we can generate good cash and good margin. Yeah. obviously position us pretty well for this, you know, extended growth market that we see going forward. Yeah. It's a market that is expected to be over $2 billion. Yeah, yeah. 2027. Is there anything else that you're watching to drive Precision & Science orders? Like, we kind of know what drives Industrial orders, but, like, anything else that you guys are watching to drive Precision & Science orders besides? Yeah. We go back to the basics of the MQLs. Yeah. You know, marketing qualified leads. Again, it's an area that early innings in the PST more so than the ITS. Got it. It is one that we watch, we watch carefully. I mean, PST is one that similar to my staff meeting at my level, the PST at their level, they do a very similar IDN whereby each of the PNLs, we track, you know, revenue orders on price on bookings, MQLs, Net Promoter Score, and that drives a lot of the momentum that gets deployed into the locations and the factories as well. Questions from the audience. Any questions? Anyone ask a question? All right, I'll continue. M&A, I think you said 11 LLIs right now. You know, it sounds about normal for you guys. You know, I guess I'll just say is like, you know, how would you compare the activity level that you expect in 2023 versus 2022? We know about the $270 million that's already in the guide. Mm-hmm. You know, I think you maybe talked about $300-$400. You guys tell us. I'd actually say, we expect to be actually fairly comparable to what you've seen last year. You are correct, just to calibrate, we have $270 million of M&A included in the revenue guide in terms of the in-year contribution. Yeah. That's essentially all the deals closed to date, inclusive of the two that we've done this year. Yeah. SPX FLOW Air Treatment, as well as the Paragon Tank Truck acquisitions. In the context of the funnel, just to give the highlights, funnel still remains about 5x larger than where it was about three years ago at the time of the RMT. We have 11 more transactions under LLI. Just to put that in perspective, last quarter, I think we said we had around eight. Mm-hmm. We closed two deals, so it went from eight down to six, and we obviously added five more. The funnel continues to remain really healthy. The LLIs I would describe as, you know, the classical bolt-on, so very similar in size to what you've seen us do kind of in the context of 2022. Mm-hmm. Think of the smaller size niche kind of technology bolt-ons, not too dissimilar from like the Paragon of the world. In the context of what the expectation is for in-year, yes, we've said that we expect to be able to execute, you know, 4%-5% of annualized inorganic growth or inorganic revenue growth acquired in-year. Think of effectively 2023 playing itself out very similar to 2022. Mm-hmm. The conversations, the funnel continue to move in the right direction, continue to be quite healthy. I'd say 2023 in our minds continuing to play itself out, much like you've seen us execute the last two years. I'll just ask you two more questions, one on the margin side. Like, I imagine you're still pretty comfortable. You know, you've got IT&S margin targets of, you know, high- 20s. You kind of ended 2022 in the mid-20s. Mm-hmm. You know, Precision & Science kind of mid-30s. Like, these are pretty high targets. Mm-hmm. You guys tell me, I mean, supply chains is what it is. Like, what needs to happen to get to these margin targets? Sure. You know, I think, if you go back now, it's been about a year and a half, for the Investor Day where we set targets. If I think kind of enterprise-wide, we said on average- Each year between, you know, ending 2021 but it's 25, about 100 basis points of margin expansion. You've now seen 2021 and 2022 actually be slightly on the higher side of that. If you look at the guidance that we actually issued yesterday, you're gonna be, you know, 80, 90 basis points of margin. You know, we would, you know, expect to hopefully be able to out execute that. We're right in line with that expectation. If you look at 2022, I think fair to say that ITS probably, you know, was a little bit more of the outperformer comparatively speaking. We think that that actually sets up for a nice opportunity set here as we think about 2023 for PST to be a little bit more outperforming that kind of what's called total company average. If you think about, you know, the setup, and, you know, Vicente mentioned a few of these things, think to 2024 now. Hard to prognosticate what might happen a year from now, but we know that the model and the company, you know, delivering 1%-2% price year- in, year- out, no reason we can't do that. If things continue to play themselves out, just like we talked about, you know, presumably we'll be in more of in a deflationary state moving in from a, from a materials perspective. We obviously have the continued momentum on productivity and things like that within the enterprise. Worth mentioning that even in the delivery of the $300 million of synergies, kind of the third leg of that stool, we always said even three years ago, it's gonna deliver towards the end is things like footprint. The reality here is we're gonna get to that $300 million target without really having had to execute on the footprint. Yeah. Frankly, the last 12-18 months I don't think was really the environment to be thinking about footprint opportunities. That frankly even still sits ahead of us in many cases. I think there's continued levers, continued opportunity, and I think the framework we were thinking about, and you layer on top the continued aftermarket growth, the continued expansion in IoT, which should continue to drive higher margin mix on the aftermarket growth. That should continue to be a tailwind as we think about the next, you know, 24-36 months. We still feel comfortable with those targets and, you know, see good runway to continue to move to those margin targets you mentioned. Got it. I still have 25 seconds. I'll ask you this last question. Been asking all the companies this question. What are the top two or three innovations, mega trends or structural changes that will affect your company over the next five years? And are there any emerging industry trends that are perhaps being overlooked? I mean, I definitely think that I go back to the mega trends of sustainability, which we talked a lot about here already now. Digitization, again, we'll go back to the Investor Day. We said there's 5 million assets that we can connect out there in the field. Mm-hmm. When you look at what we said on the earnings call just yesterday, 19% of our revenue that we shipped last year shipped with IoT-enabled devices. It means that we're now connecting them to... We do it to generate revenue, new revenue streams. That's a big next leg that we see in terms of accelerating our aftermarket. This digitally connected revenue, I mean, it comes in at pretty heavy software-like gross margins. Yeah. The third mega trend that we're very well aligned is the quality of life. Mm-hmm. Think about it from control, agricultural environment situations, where indoor farming, hydroponics, I mean, weather patterns are just damaging a lot of the food and livestock in the world while the world population continues to grow. More and more there's gonna be a lot of these controlled- environment agriculture. We are at the core and at the center of that with our Dosatron pumps and our Dosatron solutions and mixing solutions. Mm-hmm. We're very excited for things like that, as well as a lot of the potential that we see in terms of quality of life as it relates to personalized medicine and how a lot of our medical liquid handling solutions are playing a very role critical on that side so. Awesome stuff. I think we can end on that note. Thank you. Thank you, Andy. Appreciate it. Thank you. Appreciate it.