Good morning, and Welcome to the Ingersoll Rand Q4 2023 Earnings Call. Please note that this call is being recorded. 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 would like to ask a question, please press star followed by the number one on your telephone keypad. To withdraw your question, simply press star one again. I will now turn the call over to Matthew Fort, Vice President of Investor Relations. You may begin your conference. Thank you, and welcome to the Ingersoll Rand 2023 fourth quarter earnings call. I'm Matthew Fort, Vice President of Investor Relations, and joining me this morning are Vicente Reynal, Chairman and CEO, and Vik Kini, Chief Financial Officer. We issued our earnings release and presentation yesterday afternoon, and we will reference these during the call. Both are available on the investor relations section of our website. In addition, a replay of this conference call will be available later today. Before we start, I want to remind everyone that certain statements on this call are forward-looking in nature and are subject to the risks and uncertainties discussed in our previous SEC filings, which you should read in conjunction with the information provided on this call. Please review the forward-looking statements on slide two for more details. In addition, in today's remarks, we will refer to certain non-GAAP financial measures. You can find a reconciliation of these measures to the most comparable measure, calculated and presented in accordance with GAAP in our slide presentation and in our earnings release, both of which are available on the investor relations section of our website. On today's call, we will review our company and segment financial highlights and provide full year 2024 guidance. For today's Q&A session, we ask that each caller keep to one question and one follow-up to allow time for other participants. At this time, I will turn the call over to Vicente. Thanks, Matthew, and good morning to all. I would like to begin by acknowledging and thanking our employees for their hard work in helping us deliver another record year in 2023. We finished the year on a high note, with strong fourth quarter and full year results, despite the constantly changing macroeconomic environment. Our 2023 performance reinforces the impact our employee ownership mindset has for Ingersoll Rand. I would also like to welcome our new employees from our recent acquisition of Friulair, whom I had the chance to visit last week in Italy. I was very impressed by the entrepreneurial and technological spirit that has made this company grow at an impressive organic CAGR of 15% over the past three years. Starting on slide three, in 2023, we demonstrated again how we continue to outperform against our long-term investor day commitments, with double-digit growth in revenue, Adjusted EBITDA, Adjusted EPS, and free cash flow. As we move to 2024, demand remains solid, and while macroeconomic and geopolitical uncertainties continue to be at the top of everyone's mind, we remain agile and focused on what we can control. IRX is our competitive differentiator, and combined with our ownership model, we remain confident in our ability to execute on our commitments. We recently held our Investor Day this past November, and I'd like to spend a few minutes providing a couple of important highlights that we presented. On slide four, we highlighted how we deliver compounding results through our economic growth engine. With the use of IRX, we have created an increasingly durable financial profile, underpinned by our employee ownership model. Since 2016, we have transformed the company into a premier growth compounder. We have reduced cyclicality through divesting our Club Car and HPS businesses and reinvested approximately $2.3 billion into accretive acquisitions focused on high-growth, sustainable end markets. Today, our balance sheet is stronger than ever, and we enter 2024 well positioned to build upon our progress to date. Moving to the next page, we show how we are uniquely positioned to grow market share within the $55 billion of highly fragmented addressable markets we currently play. The combination of our product portfolio, multi-channel, multi-brand strategy, massive install base, and unmatched commercial and operational footprint provides an exceptional foundation for continued market share growth, both organically and inorganically. On slide six, we demonstrate how we remain committed to delivering financial performance while also doing good for the planet and our community. On the left-hand side of the page, we have some very exciting news to share. S&P Global recently announced that Ingersoll Rand ranked first in the world within our industry, up from number two in the prior year. Also, Ingersoll Rand was named to the A List for its performance in tackling climate change and commitment to global environment leadership by CDP. CDP annual environmental disclosure and scoring process is globally recognized as the gold standard for corporate transparency. Finally, as shown on the right-hand side of the page, we continue to make progress towards our aggressive 2030 goals, and we're already well on our way to achieve them. On slide seven, we show the catalyst for the progress, which is a highly engaged employee base combined with an ownership mindset. As shown on the left-hand side of the page, our employee satisfaction is over 600 basis points higher than the industry average. We believe our employee ownership model drives the increased employee engagement. As illustrated on the center of the page, we have created a massive economic opportunity for our employees and their families that has been life-changing for many, as expressed on the quotes from some of them. All All of these leads us to the next slide, where you can see that the combination of all these factors executed through our economic growth engine is evidence that our model provides durable long-term performance. Our portfolio is positioned to capitalize on global mega trends such as sustainability, digitalization, and quality of life. We expect to leverage our organic growth enablers to deliver on average, mid-single-digit organic growth through 2027. And as you can see, we outperformed this commitment again in 2023, delivering 10% year-over-year organic revenue growth. In 2023, we also delivered 6% of in-year growth from M&A. The combined organic and inorganic growth of 16% far surpassed our low double-digit growth commitment. And not only did we surpass our growth targets, but we also exceeded our margin expansion initiatives, generating 177 basis points of adjusted EBITDA margin expansion, and again, surpassing our long-term targets for this metric. With IRX as our competitive differentiator and over 400 Impact Daily Management sessions, or IDM, across our company each week, our high-performance culture encourages a strong focus on execution. In 2023, we delivered adjusted EPS growth of 25% and a free cash flow margin of 18%. These results prove that we are a premier durable growth compounder. On slide nine, to date, we're on track or ahead of schedule in delivering the 2025 targets set at our previous Investor Day. We have set new aggressive targets for 2027 long-term financial, and our results give us confidence in delivering those targets that are on average over the cycle. Turning to slide 10, M&A continues to be at the forefront of our capital allocation strategy. We invested over $450 million across 13 acquisitions in 2023. These acquisitions have been both market-leading products and technologies while accelerating our addressable market with close adjacencies. As of today, we currently have 10 transactions under LOI. Our M&A funnel remains strong and continues to be over 5 x larger than it was at the time of the RMT. We expect an additional 400-500 basis points of annualized inorganic revenue to be acquired in 2024. The 10 transactions currently under LOI are similar in size and nature to the bolt-on deals we have done over the past few years. However, outside of these 10 LOIs, we still have a couple of deals in the funnel where the purchase price exceeds $1 billion. I will now turn the presentation over to Vik to provide an update on our Q4 and full year 2023 financial performance. Thanks, Vicente. On slide 11, we finished the year strong in Q4 through a balance of commercial and operational execution, fueled by IRX, despite the constantly changing macroeconomic environment. Total company organic orders and revenue increased 3% and 4% year-over-year, respectively. We remain encouraged by the strength of our backlog, which is up over 8% year-over-year. This provides us with a healthy backlog to execute on entering 2024, and gives us conviction in delivering our full year 2024 revenue guidance. The company delivered fourth quarter adjusted EBITDA of $501 million, a 19% year-over-year improvement, and adjusted EBITDA margins of 27.5%, a 160 basis point year-over-year improvement, and a 100 basis point improvement sequentially from Q3. Free cash flow for the quarter was $552 million, and for the year, we delivered nearly $1.3 billion of free cash flow with an 18% free cash flow margin and a 105% conversion to adjusted net income. Total liquidity of $3.6 billion at quarter end was up approximately $400 million sequentially. Our net leverage continues to improve both year-over-year and sequentially. At 0.6 turns, we are 0.2 turns better than prior year and 0.3 turns better than prior quarter. Turning to slide 12, for the total company on an FX adjusted basis, Q4 orders and revenue both grew 11%. Total company Adjusted EBITDA increased 19% from the prior year. The ITS segment margin increased 260 basis points, while the PST segment margin was flat year-over-year, and corporate costs came in at $47 million for the quarter. Finally, adjusted EPS for the quarter was up 19% to $0.86 per share. The adjusted tax rate for the quarter was 20.7%, with the full year adjusted rate finishing slightly above 22%. On slide 13, total company full-year orders grew 8% and revenue increased 17%, both on an FX-adjusted basis. Total company adjusted EBITDA increased 25% from the prior year. The ITS segment margin increased 240 basis points, while the PST segment margin increased 130 basis points. Corporate costs finished the year at $173 million, driven by continued investments to support growth in areas like demand generation and IoT, as well as the impact of incentive compensation adjustments. Lastly, adjusted EPS for the year was up 25% to $2.96 per share. Moving on to the next slide. Free cash flow for the quarter was $552 million, including CapEx, which totaled $30 million. Total liquidity now stands at $3.6 billion, based on approximately $1.6 billion of cash and $2 billion of availability on our revolving credit facility. Leverage for the quarter was 0.6 turns, which was a 0.2 turn improvement year-over-year. And in 2023, we returned $295 million to shareholders through share repurchases and dividends. Specifically within the quarter, cash outflows included $130 million in share repurchases, $39 million deployed to M&A, and $8 million for our dividend payment. M&A remains our top priority for capital allocation, and we continue to expect M&A to be our primary use of cash as we look ahead. I will now turn the call back to Vicente to discuss our segments. Thanks, Vic. On slide 15, our Industrial Technologies and Services segment delivered solid year-over-year organic revenue growth of 5%. Adjusted EBITDA increased 26% year-over-year, with an adjusted EBITDA margin of 30%, up 260 basis points from prior year, with an incremental margin of 48%. We also delivered sequential margin expansion of 120 basis points from Q3 to Q4. It is important to note that we have already achieved our 2025 high 20s adjusted EBITDA margin target for ITS, which is a full two years ahead of schedule. We continue to see solid demand for our products, with organic orders also up 5%. Moving to the product line highlights, compressors were up low double digits in orders and up mid-single digits in revenue. Industrial vacuum and blowers were down low double digits in orders, but up low double digits in revenue. The order decline was mainly driven by prudently debooking an order from an electric truck manufacturer in Europe that had some battery supply issues. However, the prospects are starting to look better for this manufacturer in 2024. Also, it is important to highlight that core product lines continue to show strong momentum on a two-year stack, excluding effects and also excluding the recent acquisition of SPX Air Treatment and Roots Blower. On a two-year stack, compressor orders were up mid-teens and revenue was up high 20s. Industrial vacuum and blower orders were up low double digits, and revenue was up mid-thirties. As a reminder, for additional detailed information on product lines and regional splits, we have moved the chart, which was previously included on this page, to slide 21 in the appendix. For Innovation in Action section, we're highlighting a new compressor with advanced two-stage technology. This product is a great example of how Ingersoll Rand is providing an innovative, digitally enabled, sustainable solution with a 17% energy efficiency improvement versus the competition. Turning to slide 16, organic revenue in the Precision and Science Technology segment was approximately flat year-over-year. The PST team delivered adjusted EBITDA of $94 million, which was up approximately 2% year-over-year, with a margin of 30.1%. Organic orders were down 1.6%, driven by the life science businesses. We see organic orders growth stabilizing, and we remain positive about the underlying health of the PST business. In fact, PST, excluding the life science businesses, has seen positive organic orders and revenue growth in 11 out of the last 12 quarters. In addition, short cycle orders in the industrial businesses were up mid-single digits in Q4. Overall, the PST segment remains on track to meet our long-term investor day growth commitments. For our PST Innovation in Action, we're highlighting our ARO Piston Pump System. This is a perfect example of leveraging both I2V and demand generation to pivot an existing product line into a high-growth, sustainable end market. Over the past 12 months, we have already taken $7 million in orders with a leading OEM solar panel producer, which has the potential for $1 million in annualized aftermarket revenue. As we move to page 17, we're introducing our 2024 guidance. Total company revenue is expected to grow between 5%-7%, with a first half growth of 4%-6% and a second half growth of 6%-8%. We anticipate organic growth of 2%-4%, where price is approximately 2/3 and volume 1/3. FX is expected to contribute approximately 1% of a tailwind for the year, of which the impact will be realized relatively evenly throughout the year. M&A is projected at $160 million, which reflects all completed and closed M&A transactions in 2023, as well as the acquisition of Friulair. Corporate costs are planned at $160 million and are expected to be incurred evenly per quarter throughout the year. Total Adjusted EBITDA for the company is expected to be in the range of $1.915 billion-$1.975 billion. At the bottom of the table, Adjusted EPS is projected to fall within the range of $3.14-$3.24, which is approximately up 8% at the midpoint. We anticipate adjusted tax rate to be roughly 23%, gross interest expenses to be about $155 million, and CapEx to be around 2% of revenue. On the right-hand side of the page, we have included a 2024 full-year guidance bridge, showing the growth associated with both operational activity and the impact associated with corporate costs, interest income and expenses, FX, share count, and changes in the adjusted tax rate. Based on the above guidance, adjusted EPS growth is expected to be 6%-9%. As we sit here in mid-February, we would like to provide some commentary on Q1. We expect our normal seasonality to return in 2024 from a revenue perspective, which means that Q1 will be the lowest revenue quarter of the year. In addition, as a reminder, Q1 has a very tough comp, as we delivered 20% organic revenue growth in Q1 of 2023. As a result, we anticipate organic revenue growth to be flattish to slightly up for the quarter, with continued year-over-year margin expansion. Turning to Slide 18, as we wrap up on today's call, I want to reiterate that Ingersoll Rand is in a solid position. We continue to deliver record results, and both our long-term and 2024 guidance is reflective of our performance to date and our increasingly durable financial profile. To employees, I want to thank you again for another excellent finish to the year. We delivered strong results by demonstrating our commitment to meeting our financial targets and executing our economic growth engine through the use of IRX. Thank you for your hard work, resiliency, and focused actions. These results show the impact you each have as owners of the company. Our balance sheet is as strong as ever, and with our discipline and comprehensive capital allocation strategy, we remain resilient and have the capacity to deploy capital to investments with the highest return as we continue our track record of market outperformance. We remain nimble, continue to monitor the dynamic market conditions, and we're prepared for the challenges that may come. With that, I'll turn the call back to the operator and open it for Q&A. Thank you. At this time, I would like to remind everyone, in order to ask a question, please press star one. Your first question comes from Mike Halloran with Baird. Please go ahead. Hey, thank you. Morning, everyone. Morning. [audio distortion] So let's start with where you ended there on the guidance piece. You know, certainly appreciate all the context and help, and understand the relatively normal seasonality, but maybe you could just talk to what you're embedding from an underlying assumption perspective when it comes to, you know, the broader environment, broader end markets. Is this a year where you just see relatively sequential stability? Any specific pockets you're concerned about or where you see opportunities for acceleration? Less of an Ingersoll-specific question, meaning I know you have a lot of drivers that you can use to, you know, boost growth relative to whatever the end markets are doing, more of just an end market-specific and an environment question. Yeah, Mike, so maybe I kind of give you a perspective here on how we think about it by region first. I would say in America, as suspected, we're seeing much better momentum. I would say mainland Europe. I want to say America is, I mean, not only the US, but even also Mexico and South America, where there's a lot of good progress going on with the teams down there. Mainland Europe remains relatively stable. I was just in Europe last week and really solid momentum from some good pockets of growth that we're seeing. But I'll say, call it. I'll call it more stable. I'll say broader Middle East and India, you know, very also very good momentum, I mean, particularly in India. And you've seen that we have done quite a few investments in India, too, as well, not only from an inorganic perspective, but also organic. And I'll say that APAC, Asia Pacific, is the one that has the most headwinds, specifically, I would say, here in the first half of the year, and it's driven mainly by tough comps. I mean, we saw strong double-digit organic revenue growth in the first half of 2023 in Asia Pacific, mainly driven by China. And at this point in time, I mean, China is not a market that we call it that is perhaps booming. We're not immune to that, but we expect to outperform the market there, too, as well, as the teams have proven that they could do that, even in 2023. So that's kind of from a regional perspective. I'd say from an end market perspective, nothing that I would call out to be highly differentiated in, in the sense, as you have seen us always pivot to these high-growth, sustainable end markets. We gave you one very good example here with Aero Piston Pump. This is a legacy product line that we kind of reinvigorated. We utilized I2V as a way to relaunch the product, and with the use of demand generation, we were able to position that product line into a very good growth end market on photovoltaic cells. So, as I say, Mike, I mean, I think the playbook continues to be the same. It's be agile, very nimble, leverage demand generation and IRX as a way to continue to out execute. No, that makes sense. And then a follow-up on the life science side. You know, the one area of PFCT that, you know, like a lot of the folks, is seeing some headwinds here. You listen to what the bigger players in the industry are saying, there's, you know, more stability front half, improvement back half, I don't... At least modest. Is that similar to what your expectations are from a recovery curve at this point? That's kind of what we think, too, as well, Mike. You know, again, you know, as you said, you know, maybe bottoming out here as we kind of come into the first half and then seeing sequential improvement. I mean, not in an exponential way. I mean, there's no that pent-up demand, but I would say in a very logical way to get back to the good growth that these end markets should continue to see over the long term. Great. Appreciate it, everyone. Thanks. Yes. Thank you, Mike. Your next question comes from Julian Mitchell with Barclays. Please go ahead. Hi, good morning. Just first off, just wanted to look at the sort of cadence through the year, perhaps first off. So based on what you said, is it fair to assume sort of first quarter is about 21% of earnings for the year. And when we're looking at kind of incremental margins, you call out that high 30s figure for the year. Is that kind of fairly steady across both segments as we move through 2024? Yeah, Julian, this is Vik. I'll take the first part of your question, and I'll have Vicente probably talk on the margin front. I think the phasing, generally, I think you're right. You're in the right ballpark. Maybe another way to say it here is, if you look at the phasing in a manner that's consistent with, you know, I'd say revenue and earnings delivery as we saw in 2023, I think you'd be, you know, in the right ballpark in terms of our expectations here for 2024. And then, you know, in terms of the incremental margin piece, maybe I'll get started, or- Yeah, no, I can take that. I mean, I think the way I think about that incremental margin. I mean, think about that, you know, 35%-40% incremental margin. When you look at the main buckets, I'd say the first bucket of that improvement or good incremental margin comes in from the initiatives that we always do, the I2V price. Very good continued growth momentum on the aftermarket, particularly the recurring revenues. The second bucket will be around the prior M&A improvement activities that we have always spoken about. The third bucket is, you probably saw, on some of the appendix that we did some proactive restructuring at the end of 2023. This is kind of part of us continuing to be proactive and nimble. The last, fourth bucket, I will say, in terms of these margin improvement, is around corporate cost. You saw corporate cost going down, roughly $13 million or so. That's helpful. Thank you. And just, you know, as we're starting out the year, looking at orders, naturally, the sort of volatile quarter to quarter, you know, reflecting what you said on a sort of a tough Asia environment in the first half of the year and sort of very tough orders comps. Do we think about kind of orders being down, perhaps in the first quarter, year on year, and then you pick up after that as the comps and perhaps Asia get better? So we typically don't guide on the orders for the year or on a quarterly basis, but we do definitely expect orders to be up sequentially from Q4 to Q1, on an absolute dollar perspective. And the way we think about it too, as well, is that we typically book above one on a book-to-bill in the first half, due typically to larger, longer cycle projects being booked, and then below one in the second half. And we don't anticipate 2024 to be any different to that. That's great. Thank you. Thanks, Julian. Thank you. Your next question comes from Jeff Sprague with Vertical Research. Please go ahead. Hey, thank you. Good morning, everyone. Hey, Vicente, can we just come back to life sciences for a moment and just level set us here now after, you know, kind of a couple tough years? What% of PST is that business now, and do you actually expect it to return to growth in 2024? So the life science business is roughly 25%-30% of the PST segment today. And I think as we think about going into the second half, is when we expect that to be getting back to normal growth. Right. And then just, thanks for the guidance on price versus volume. Just give a little bit of color on what you're expecting, just kind of the price cost equation, as we move through the year and maybe particularly in ITS? Yeah, Jeff, this is Vik. I'll take that one. I think simply stated here, I don't think you're going to see anything dramatically different than what you've seen historically. Meaning, you know, we expect to, you know, generate approximately 2% price on a full year basis. We would expect to be both dollar and margin positive from a price cost perspective each quarter of 2024. So again, nothing different in terms of that equation as we move through the year. Obviously, ITS, you know, being the bigger segment, clearly that comment pertains to ITS as well as PST as well. Great. Thank you. Your next question comes from Rob Wertheimer with Melius Research. Please go ahead. Thanks. Actually, one more question on life science. I mean, we've seen you guys use demand generation and just IRX to outgrow tough markets in China and maybe Europe last year. Has that been a factor in life science? Is there anything different in that market that, you know, that constrains it? And then I wonder if you could just kinda compare, you know, market dynamics for you in life sciences to some of the other companies and industrials we've seen in the long drag. What does the recovery look like? Is there a bounce back? Has there been? I mean, maybe just explain the sales dynamic there. Thank you. Yeah, Rob, I'll say, you know, life science is, and I think you were referring to, particularly in China. I mean, they have seen similar declines, like the balance of the life science businesses and, and biopharma related markets. And I would say for the balance of our China exposure, it isn't that much different than the impact we have seen on the ITS side, with the one item of note to call out, perhaps Seepex, a business that is more impacted by the water market. But that being said, I mean, we're, we're excited with the, with the prospect of Seepex in China. And, and one example of that is that, you know, again, pivoting to better end markets. So, for example, the Seepex took the same product and relaunched that to move away from the water market and move more into the lithium battery production with a very unique proposition, without having to reconfigure that product too much. So, I think we just continue to navigate that. I mean, basically, how do we continue to agile and very nimbly move from one end market to the other without having to reconstruct the product lines? [crosstalk] Oh, sorry. No, no, go ahead. Yes. I beg your pardon. Yeah. So, so it was a little bit of two. So it was like, does demand generation, has demand generation or other tools allowed you to outgrow the decline in, you know, in life sciences? And then maybe just, maybe it's the same question as Jeff asked in a way, but, does the other side of this look like a bounce back, or does it just look like a return to, to normal growth? I don't know whether, you know, destock or whatever at your customers has led to below normal sales, and you kind of pop back up in 25 or whether you just resume normal growth. I, I will stop there. Sure. No, yeah, great. To the first question, absolutely, demand generation is really helping us tremendously. Because then, think about it, I mean, our products can be applicable to pretty much any end market, and we're being very selective. And with demand generation, we can really reach these highly fragmented customer base in a very cost-effective way, very rapid, very quickly, and then provide, you know, a better solution to our customers on their needs. Call it energy efficiency, water efficiency, digitalization, all these, all these thematics that we think are important. For the second question, we kind of. The way we think about it is more normal. We don't expect this massive bounce back. If that happens, clearly upside, but the way we like to view it is more normal. Thank you. Your next question comes from Andy Kaplowitz with Citigroup. Please go ahead. Good morning, everyone. Hey, Andy. Hey, Andy. Vicente, I think you had an increase in your LOIs in Q4 to 10, I think, from four last quarter. Are you seeing the M&A market open up a bit more? Is this more your team just finding more deals? And those couple of deals that you mentioned that are over $1 billion, do you see the larger deal market opening up, or is it still difficult to get those larger ones over the finish line? Yeah, so, I would say that, yes, I mean, the M&A, we feel that continues to open up. And again, I'll put it in perspective that these 10 transactions in the LOI are similar in size and nature to the bolt-on deals that we have done over the past years. And, you know, these 10 LOIs are also sole source, meaning we have been proactively talking to the family-owned and have built some incredible relationships. This is exactly what happened with the Friulair acquisition, too, as well, which, you know, I've been in contact with the founder named Luigi. So but... So again, you know, outside of these LOIs, we still have a couple of those deals in the funnel where purchase price exceeds $1 billion. So yes, there's still, I mean, timing of that, obviously difficult, but we still have a couple of those in our funnel. I will also tell you that, you know, we actually also walked away from one of those $1 billion purchase price transactions, which I, again, speaks to the prudence and the discipline of our continued model, that even after, you know, six to nine months of continued diligence, we decided that it was just not the best case for us to proceed. So we remain highly disciplined in this environment, and we see just a lot of good opportunities out there. It's very helpful. And then can you give us more color, you know, in terms of the end markets, you answered the question before, but if I look at Americas and EMEA, you know, pretty continued durable growth, is it more the 20% of your business that's longer cycle, you know, larger compressors? Is it more of the short cycle stuff, that that's supporting your growth? And what do you think the sustainability of, you know, the two markets is? Yeah, I mean, I think we think that maybe over the past couple of years, it was a lot more on the longer cycle. We see now, you know, perhaps as you kind of continue to see PMIs do better, that shorter to medium cycle will continue to see maybe a better momentum. So inflecting, we see some of that even already here. And you saw we spoke about that, particularly, let's say, even PST, on that we said, you know, the industrial shorter cycle of mid-single digits year-over-year, and then also sequentially. So I think, yeah, I mean, I would say that our teams continue to stay pretty agile in these continuing to pursue energy efficiency in the compressors with our story around how we can save tremendous amount of energy. That is a very good thematic that continues to be out there. The thematic around reshoring, very strong, continues to be the case in countries even like Mexico or even South America. But so I think the same thematics are still happening that we've been talking about for the past couple of years, Andy. Appreciate the color. Thanks, guys. Yeah, thank you. Your next question comes from Nigel Coe with Wolfe Research. Please go ahead. Thanks. Good morning, everyone. Hey, Nigel. Happy Friday. So all the big questions I think have been asked, but maybe just give us a bit of color on what you've seen in China. Looks like that was down in the quarter. So maybe just quantify that and kind of like what's your sort of base case view on China? And then perhaps as part of that, first half as the second half, it looks like core growth flat 2% in the first half of the year, and then we're gonna lift the mid-single digits in the back half of the year. Is that simply easier comps, or are we seeing some acceleration, I don't know, maybe in China or perhaps in life sciences? Any color there? Yeah. I mean, so, so China, I was actually in China a few weeks ago, earlier here in January with the team, and we were doing a pre-acceleration of the Chinese Happy New Year. So but in addition to just reviewing how the business is performing and, and to keep that in mind, I mean, I was, I think over the past six to nine months, I've been to China now 3 or 4 x. So, so I think it's just one that we continue to stay really close to, to understand, you know, how our teams continue to control what we can control. So from an orders perspective, yeah, I mean, China in the fourth quarter was down mid-single digits. But keep in mind that this is, on top of, like, a low double-digit orders growth that they saw in Q4 of 2022. So again, I think, on a two-year stack, they still saw, you know, high single-digit order momentum, which is pretty impressive, when you consider everything that is going on in China today. I would categorize the environment in China this time that I went to much better than what I saw in 2023, in the sense that there seems to be the teams are re-energized about maybe what what's happening in terms of the stimulus and how the teams continue to leverage our technology into other end markets that they see some good pockets of growth. So I was very encouraged to see how the team continues to navigate that difficult market by being very nimble and agile in terms of pivoting to those areas of good growth. Yeah, Nigel, on the second part of your question about the kind of the growth cadence, first half for second half. Yeah, probably a couple of factors I'd point to. One being, first and foremost, we do walk into the year with a, with a, you know, still healthy backlog, including, you know, a good percentage of that that's longer cycle in nature. So that obviously gives us some good visibility into the back half of the year when a lot of those projects tend to more naturally ship. And then, yes, I do think there's a lot of truth in the statement you made about, clearly, you know, comps get a little bit more moderate in the back half of the year, you know, kind of across the board. But, you know, clearly, whether it be China, as well as the life sciences side of the equation on the PST business. So I think it's a couple different factors, but, you know, again, like we said before, we think the phasing of delivery of revenue and earnings is actually very consistent in 2024 versus what you've seen historically. That's, that's great color. My, my follow-up question is, you know, the, the strength in European compressor orders is remarkable, considering, you know, what's going on in, you know, the, the economy there. So if you had to rank order these three, Scope 1 emission targets, CO2 pricing, and high energy prices, what do you-- and, you know, obviously IRX on top of that, but if you had to rank those three, what, what would you say is the, the, the most important factor? I would say high energy prices and Scope 1, which are, I mean, kind of interrelated, one with the other one. But yes, I'd say high energy price is number one, Scope 1 in terms of targets is that many of the companies have put out there, and then the third would be around the CO2. Great. Thanks, Vicente. Yeah. Thank you. Your next question comes from Joe Ritchie with Goldman Sachs. Please go ahead. Hey, guys. Good morning. Morning, Joe. Hey, Joe. Hey, so a nice end to the year. Obviously, incremental margins were great. You know, you hit your margin target two years ahead of time. So if you think about this ITS business now, and I know that you, you have this incremental margin target for the year of 35%-40%, I guess just to. I'm just curious, like, how much of that would you say is volume dependent at this point? I know IRX is all about continuous improvement, but just your ability to just deliver continued margin expansion if the volumes, you know, ultimately turn out to be weaker than expected. Joe, I'd say that, I mean, even when you think about our guidance, I mean, it just shows that, you know, lower growth, but still generating that very good margin, and that's driven by, you know, the activities that we have done, you know, call it I2V, also price and even aftermarket. So I think those are three core initiatives that we have continued to do really well. We always said that, you know, the ITS was very well ahead because that was part of an integration between Gardner Denver and IR on how we did those three initiatives prioritize there. But I can tell you, I mean, the PST team, like even two weeks ago, they had, like, a worldwide I2V event, and it was just highly, highly encouraging to see how our new leader is just driving that type of methodology into a segment that, in the past, you know, they, they did it, but not in a way that we'd like, we'd like that to be done. And in addition, I think what you saw here in the fourth quarter is that, you know, we took some proactive, surgical, what we call surgical restructuring at the end of the year. And, and again, that's a prudence for us to continue to protect the, the PNL. I think that's, you know, controlling what we can control and taking the actions to ensure that we can deliver that solid margin improvement. That's helpful, Vicente. And look, it sounds like you've been on the road globetrotting the last several weeks. I'm curious, just from a regulatory standpoint, are there any kind of changes in regulations that you guys are seeing across any particular region that might be impacting your business or could impact your business going forward in the next, we'll call it, you know, next 12 to 24 months? I mean, nothing that I would say of significant dramatic change that is new. I mean, we know about clearly the energy efficiency standards that are coming into effect by the federal government in the U.S. There's some refrigeration standards that will drive basically our air treatment business, view it in a positive way, driven first in Europe and then in the U.S., too, as well. But, but those are kind of known, that we have known for a little while, and, but they're not new. Okay, great. Thanks, guys. Thank you. Your next question comes from Steve Volkmann with Jefferies. Please go ahead. Hi, good morning, guys. Thanks for taking the question. Maybe just a couple of longer-term ones here. Just kind of going back to orders and backlog. Now that the world is sort of normalizing again, over some period, should we expect backlog to decline, or do you think it's kind of at the rate that it should be going forward? Yeah, I look at the way is that, I mean, so good news is that clearly we're still at pretty high backlog, which is encouraging to see. I think over time, perhaps, yes, it will get normalized. But again, I think that when we think about the business, that if we continue to get this book-to-bill of one of approximately one, that we continue to expect to see here in 2024, I think backlogs seem to be continuing at a pretty high level than what we have done historically. Right. Okay, great. Okay, great. Yeah. The other thing I would say there is, you know, with the amount of, as they said, with some of the longer cycle, we do fundamentally feel that compared to years in the past, there is just a higher amount of our backlog that's, you know, the longer cycle projects, which then, you know, clearly leads to the level of backlog you have now. So I think that you have seen a little bit of a structural change in the composition of the backlog as compared to more historic times. Got it. Okay, thanks, Vik. And then, switching gears a little bit, companies that are acquisitive and sort of have this flywheel that you guys have, you know, occasionally something comes over the transom that isn't quite what you thought it was gonna be, and you may have a little disappointment in some piece of some business or something. So I'm just curious, any lessons learned, anything like that happening? And more importantly, should we expect some level of divestitures to be kind of part of this machine as we go forward? Yeah, Steve, I'll start on that. So, you know, you've seen us now since the merger done, you know, we've done over 40 transactions. And, you know, obviously, not all of them have been, you know, 100% the same. But what we would say here is, and we've acknowledged this before, probably the ones that maybe, you know, were maybe slightly below expectations, comparatively speaking, are probably the ones where IRX and that integration process probably didn't, you know, get embedded, you know, from day one, if not before. So if the lesson learned here is, you know, we've got a playbook, you know, whether it's an ITS acquisition or a PST acquisition, we're gonna continue to deploy that playbook on the IRX side, because we fundamentally view that as the catalyst for success in terms of, you know, the integration and really embedding those businesses within the core. Yeah, I mean, the only thing that I would add to that, too, as well, is that, I think we said this before, but, you know, my staff meeting, which happens, typically, you know, on Fridays, it's run as an IDM, part of the IRX. And one of the areas of focus is basically, we have a dashboard of all the M&As that are getting integrated, where we can clearly see if there's any issues or gaps. And that was an implementation that we did a few, you know, quite a few months ago, I would say 18 months ago, as we saw maybe some, some businesses that were not properly integrated. So I think it's just part of that, as Vik said, continuous improvement, good evolution, and having the news travel fast, so that we can react and course correct if something is not going the right way. Great. Thank you, guys. Yeah. Your next question comes from Chris Snyder with UBS. Please go ahead. Thank you. I wanted to also ask on the M&A engine, and maybe a more high-level one. So revenue in 2024 is gonna be about 40% above 2021. Does that make it more difficult for the company to add this 400-500 basis points M&A contribution every year? And does it change anything around the process of doing so, just as the numbers have, again, I guess, gotten 40% bigger versus three years ago, to keep that same run rate? Thank you. Yeah, Chris, I would say that... I mean, has it become more difficult? I would say that, when you think about it, back in 2021, I think our addressable market back in that Investors Day, we said it, we said it was maybe, what? $25 billion [crosstalk] $25 billion-$30 billion. And you saw our most recent Investors Day, our addressable market being $55 billion. So clearly, when we make an acquisition, we look at it also from the perspective of, are we able to increase the addressable market? And by increasing the addressable market, we're doing it in a highly fragmented market that gives us a greater pool of transactions to be able to be acquired. So we're always very thoughtful on how we on this kind of flywheel, on the M&A engine, as to- just to being one that is just not, it's an ongoing engine that can continue to grow. And I think that's, you know, in terms of statistics and data points, that's why we track, you know, number of transactions by target and with the probability. So I think the cadence of that M&A, it's pretty solid. And in terms of change in the process, I mean, nothing that I will say has been dramatic change. We continue to always make some tweaks and improvements. Like, I think about a year ago, we spoke about how we look at about 100 microtrends, and that leads into new M&A transactions that we can actually possibly do. So we're always trying to continue to evolve our process to make it better on an ongoing basis. So changing the process, yes, because we are always continually improving the way we do things. Appreciate that. And then maybe just to follow up on productivity and efficiency of the business. Obviously, margins have been really strong here the last three to four years. Do you feel like the efficiency of manufacturing has returned to pre-COVID levels? You know, obviously, there's a lot of disruption coming out of the pandemic, which I'm sure was a headwind to margins in some capacity. Do you feel like that is fully back at this point? Thank you. I mean, I don't think so, only because, I mean, I think still there's a little bit of supply chain disruption here and there that happens, right? And so giving you, for example, I mean, the situation with the Red Sea, the situation in the Panama Canal, I mean, a lot of that creates supply chain disruption, and we're, we as a company, that we're so global and being so good in terms of assembly, any time of supply chain disruption, it creates inefficiencies in the factory. So I would say that it is not back to the normal stability that we have seen maybe pre-COVID. That's my view. And I think also, we're pretty critical, Chris, in terms of how we want to continue to improve our factories and our operations. Is that lean mindset that of continuous improvement, that always views that, "Hey, we're always have to do better than what we did in the past. Thank you. Appreciate that. Thank you. Your next question comes from Joe O'Dea with Wells Fargo. Please go ahead. Hi, good morning. Morning. Wanted to just start on the growth algorithm, and if we think about two points of price and one point of volume, and just how you're thinking about the overall macro and the type of growth that you have kind of underlying on the volume side. Really, you know, just trying to understand, you know, how much demand generation is embedded in this initial guide. You know, is that one point of volume reflective of outgrowth or is there, you know, potential sort of upside on the demand generation side of things? Yeah, Joe, maybe I'll start with that one. Yeah, I think we, we always view that there's, there's upside on the, on the demand gen side, and, frankly, even on the volume side. Let me, let me kind of unpack that a little bit. I think, I think Vicente mentioned earlier, you know, when you look at the regional trends here, you know, with probably Americas are kind of at the top of the stack, EMEA, relatively more stable, and, and, you know, APAC, which is, you know, largely China for us, probably facing the most headwinds, at least as we enter the year. You know, that's kind of the balanced equation that we looked at as we thought about the, the growth algorithm, as you said. Now, that being said, you know, we enter the year with, with healthy backlog, solid backlog. You know, demand generation, without question, is part of the equation here. And, you know, clearly, we would say not too dissimilar from, frankly, even years past. You know, if there's upside opportunity in the context of the guide or in the context of the year, it really, really probably more so becomes that organic volume piece, probably more so into the, you know, as the year progresses. So again, I don't think the equation for us is you know, is dramatically different than you've seen historically, but, you know, we are conscious and taking into consideration, you know, some of the regional trends that we're seeing, particularly as we enter the year, and we're gonna continue to monitor those and pulse those as we get through the quarter and into second quarter in the back half of the year. Understood. And then on ITS margins and the 30% in the fourth quarter, if you could kind of unpack that a little bit and bridging that sequential improvement from 3Q to 4Q. And then also just to clarify, it sounds like the 35%-40% incrementals applies to both segments, and so it's not like that exit rate sets up a tough incremental comp. Not sure if there was any restructuring that sort of hit the ITS side or if that was more on the PST side, but just some details there would be helpful. Yeah, sure. Maybe I'll take those in pieces here. So, if my memory serves me correctly, went from about, you know, 28.8% EBITDA margins to about 30%, so a little over 100 basis points, sequential margin expansion from Q3 to Q4. I'd point to a couple of things here. You know, one, you know, frankly, as the revenue and volume levels, you know, tend to pace through the year, you know, a lot of our productivity measures are tied to volume. So when you see a heavier shipment quarter, like you saw in Q4 as compared to Q3, you should expect things like some of the productivity measures, the I2V to follow. I'd say that's probably one of the single biggest drivers. I think price costs continue to remain quite positive and, you know, overall, just strong, solid execution as we exit the year. The other thing that I think we continue to see good, you know, what I'd say momentum on, is the aftermarket side. And that really sets up nicely. Even during the Investor Day, we, we indicated that, you know, aftermarket, as well as the whole recurring revenue side of the equation, is a big focal point for us, and we would expect to continue to see that, not only ramp as we think about the next few years, but also that being margin accretive in the overall equation. So again, I think that's, you know, probably the way that we think about the equation in terms of what kind of drove Q, Q4 specifically. Now, in terms of the whole, you know, incrementals and how we think about, you know, 2024, like we said, 35%-40% is the kind of the overall average. The way I'd probably think about it here is, you know, ITS is probably playing, you know, maybe towards the lower end of that, you know, probably in the 30s realm. PST obviously probably has a little bit more outsized opportunity, but I think that also goes with the fact that we said that while we're pleased with PST delivering 30% EBITDA margins in the full year of 2023, we know that business can get up into that mid-30s realm, and as such, there should be a little bit more of an outpaced opportunity. So there's a little bit of puts and takes there, as well as, as Vicente mentioned earlier, a little bit of upside on the corporate cost as we think year-over-year. So hopefully, that kind of gives you a little bit of a sense of how we're thinking about the year playing itself out. Yep, all, all helpful. Thank you. Next question comes from Nathan from Stifel. Go ahead. Good morning, everyone. Morning, Nathan. Hey, Nathan. A couple fairly narrow questions. I know one of the strategic additions you've made in M&A has been to add drying to the portfolio, so I was just hoping to get an update on the benefits that you're seeing there, revenue synergies that you're generating there, whether or not you think that portfolio is built out or it's still an opportunity to add more of that capability. Yeah, Nathan, it's definitely a very exciting addition to, and you have seen that we made quite a few acquisitions on that. I mean, not only the SPX Flow air treatment side, Oxywise, we acquired Holtec a couple of years ago, and now Friulair too, as well, and then in China, even also Hanye. And the reason for this is that because, you know, air treatment is very good from the perspective of being attached to a compressor. If you think about the attachment rate, it should be like 70% attached to a compressor. So clearly, that's, you know, in terms of a KPI, of a metric that we use with our teams, is exactly that. What is the attachment rate? When you sell a compressor, how often are you attaching that air treatment to that? And that definitely drives some good growth momentum. And then to think about it, too, as well, air treatment is roughly 50% of aftermarket, so it generates a very good solid aftermarket. So the combination of those two factors, we like it a lot. And then the third item of why we like it is because you can actually optimize energy efficiencies much better when you have the combination of the compressor and the air treatment talking to each other in a common way and being remotely connected and then fine-tuning that connectivity. So I think it's a multiple levers of strategic growth that we see on this dryer portfolio. Your next question comes from David Raso with Evercore ISI. Please go ahead. David Raso, your line is open. Hi, sorry about that. Just a couple quick questions. A clarification on the M&A comment. I thought I heard the word incremental 400-500, but you already have 2%-2.5% of acquired revenues booked that'll flow through this year. Was that truly 400-500 above what's already booked, or just getting up to the framework of 400-500 basis points of acquired revenues? If you can just clarify that. Yeah, David, let me take that. So, I think, take them in pieces here. So you obviously have the carryover, as well as the Friulair acquisition. So you see in our guidance the, you know, approximately $160 million of revenue contribution. That's the carryover, and the completed to date, obviously, would expect to book, you know, to close more acquisitions as the year goes by. But embedded in the guide is that 160. The comment about $400 million-$500 million would be the acquisitions that we expect to make in the year and the annualized revenue contribution. So for all the deals that we expect to make here, based on the funnel and all the comments that Vicente made, we would expect that to be, you know, 400-500 basis points on an annualized basis. So you should take those kind of two statements, you know, separate from each other. But again, I think the short answer here is we expect to continue to operate well in line with, you know, our stated, you know, economic growth engine, how you've seen us operate in years past. Thank you. I just wanted clarification on that. On the call-out to that EV truck manufacturer in Europe on the vacuum and blower order weakness, you made a comment like it. I think prospects are improving potentially for that again. Just so I'm clear, do you think that order could come back on the books? Because it seemed to be of some size. Must be, you know, $20 million-$30 million or so, not small. Is that something that can come back on the books? Yeah, let me take the first part of that. I'll have Vicente answer it. The way I would describe it is, interestingly enough, we de-booked it in Q4 of 2023, and the original order happened to have come in Q4 of 2022. So interestingly enough, it kind of hit us both ends, both in the quarter as well as the comp. Vicente, I'll let you speak to the [crosstalk] prospects going forward. Yeah, and the prospects going forward is that, I mean, we're still in touch with them. I mean, basically, they had a situation where the battery supplier went bankrupt, and that led to this truck manufacturer not being able to produce the trucks. Needless to say, what we're seeing now is that, it's been acquired, the assets have been acquired, and they have great technology. I mean, this is for the last mile delivery trucks in Europe, which is very highly needed. And so the conversations continue to happen, which obviously means that there could be some good prospects here as we go into 2024. Okay. Thank you very much. Sure. Your final question comes from Nicole DeBlase with Bank. Please go ahead. Yeah, thanks. Good morning, guys. Thanks for squeezing me in here. Hi, Nicole. Maybe just starting with a free cash question. So conversion of 100%, saw the CapEx plans. How are you guys thinking about working capital for 2024? Sure. Yeah, I think, Nicole, I think, you know, broad strokes here, we, we still see an opportunity here, I think is, is the, is the long and short of it. You know, while we were pleased with our kind of exit momentum ending on 2023, particularly on the inventory side, which was a very much a source of cash in the quarter, we frankly still sit at elevated levels, comparatively speaking, to, you know, I'd say, you know, the pre-supply chain dynamics and things of that nature. So, you know, I think that's definitely an opportunity, as well as I'd say, some of the just core, I'll just call it blocking and tackling. You know, whether that be just kind of the collections and things of that nature. Fair to say that we still have a component of our portfolio, whether it be, you know, parts of the PST organization, as well as a lot of some of the bolt-on M&A that's not in the shared service environment, which obviously, for us, is a big catalyst of working capital improvement. So you put that all together, I think that still lends itself as a good source of opportunity for 2024 and beyond. Okay, thanks, Vik. And then just, it doesn't look like you guys have any buybacks in the guidance based on the share count outlook. So how is your view on potential buyback activity in 2024? Thank you. Yep, that's correct. We do not have any, I'd say, incremental buybacks as part of the guidance. Now, that being said, I think the way you should expect us to operate here in 2024 is similar to the prior years, meaning, you know, a requisite amount, approximately, we've always said approximately $250 million is probably a good proxy and a placeholder in terms of expectations for the year. But you are correct, that is not formally in the guidance. Thanks, Vik. There are no further questions at this time. I will now turn the call back to Ingersoll Rand's CEO, Vicente Reynal, for any closing remarks. Yeah, thank you, Brianna. As we wrap up here, I just want to pass one more thank you to our employees who continue to think and act like owners because they are owners of the company. It's very exciting to see, as I travel around the world, the high level of engagement and energy that we have across our organization. I think our economic growth engine is powered by that momentum on the ownership mindset and leveraging our IRX. So again, very encouraged, very happy, and to see the performance, and look forward to another great year here in 2024. Thank you. This concludes today's conference call. You may now disconnect.