Good morning. My name is Rob, and I will be your conference operator today. At this time, I would like to welcome everyone to the ITW First Quarter Earnings Conference Call. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question-and-answer session. If you would like to ask a question during this time, simply press star followed by the number one on your telephone keypad. If you would like to withdraw your question, again, press the star one. For those participating in the Q&A, you will have the opportunity to ask one question and, if needed, one follow-up question. Thank you. Karen Fletcher, Vice President of Investor Relations, you may begin your conference. Okay. Thank you, Rob. Good morning, and welcome to ITW's first quarter 2023 conference call. I'm joined by our Chairman and CEO, Scott Santi, and Senior Vice President and CFO, Michael Larsen. During today's call, we will discuss ITW's first quarter financial results and provide an update on our outlook for the full year 2023. Slide 2 is a reminder that this presentation contains forward-looking statements. We refer you to the company's 2022 Form 10-K and subsequent reports filed with the SEC for more detail about important risks that could cause actual results to differ materially from our expectations. This presentation uses certain non-GAAP measures, and a reconciliation of those measures to the most directly comparable GAAP measures is contained in the press release. Please turn to Slide 3. It's now my pleasure to turn the call over to our Chairman and CEO, Scott Santi. Thank you, Karen, and good morning, everyone. As you saw from our earnings release this morning, we delivered a solid start to the year, with results coming in largely in line with our expectations heading into the quarter. Starting with the top line, organic growth was 5%, with four of seven segments delivering positive organic growth, led by food equipment up 16%, welding up 10%, automotive OEM up 8%, and Test & Measurement and electronics up 6%. Polymers and fluids was flat, construction was down 1%, and specialty was down 5%. Operating margin expanded 150 basis points to 24.2%, with a 100 basis point contribution from enterprise initiatives. GAAP earnings per share increased 10% to $2.33, which was a new Q1 record for the company. Our free cash flow conversion rate was 86% of net income, which was in line to modestly above normal Q1 levels. Looking ahead at the balance of the year, while there is of course some uncertainty with regard to the macro environment, I have no doubt that my ITW colleagues around the world will continue to read, react, and execute at a high level to whatever comes our way. I will now turn the call over to Michael to discuss our Q1 performance in more detail and our updated full-year guidance. Michael? Thank you, Scott, and good morning, everyone. ITW delivered another solid quarter operationally and financially, starting with organic growth of more than 5%. Foreign currency translation headwind and divestitures reduced revenue by 2% and 1% respectively. On the bottom line, operating income grew 9% with incremental margins of 98%. Operating margin improved 150 basis points to 24.2%, with enterprise initiatives and price cost contributing 100 basis points and 190 basis points, respectively. In addition to higher wages and benefit costs year-over-year, we're funding our growth investments, including headcount in the areas that support our organic growth strategies and initiatives. We still delivered 150 basis points of margin improvement in the quarter. GAAP EPS grew 10% to $2.33, which included foreign currency translation headwind of $0.06. Our Q1 tax rate was 22.6%. As Scott Santi said, it was encouraging to see our free cash flow performance return to normal levels. Overall for Q1, excellent operational execution across the board and strong financial performance, including record EPS. Please turn to Slide 4, starting with positive organic growth in all of our major geographies, including North America, which represents about 55% of total revenues and grew 5%. Europe was up 6%. Asia Pacific grew 2% despite a 6% decline in China due to COVID-related headwinds in Q1. Moving on to segment results, starting with automotive OEM and solid organic growth of 8%. North America was up 3%. Europe grew 16%. China was down 5% due to COVID-related headwinds in Q1, and we're seeing the expected bounce back here in Q2. In terms of automotive OEM margins, we are beginning to recover the price cost margin impact that has diluted margins in this segment by about 450 basis points over the last twtwo years. As a result, we expect price cost margin impact to turn positive starting in Q2, which combined with positive volume leverage and contributions from enterprise initiatives, will lead to higher margins sequentially and year-over-year, starting in Q2 and for the balance of the year. Turning to Slide 5. Food equipment delivered another strong quarter with organic growth of 16% as North America led the way with organic growth of 21%. Institutional end markets were up more than 50% with particular strength in education and lodging. Restaurants were up more than 30%. International revenue grew 9% with Europe up 11% and Asia Pacific was down 6% due to China. Strong progress on margins with Q1 operating margin of 26.7%, an increase of more than 400 basis points year-over-year. Test & Measurement and Electronics delivered organic growth of 6% despite a double-digit slowdown in semiconductor-related revenues, which represent about 20% of segment revenue. Demand for our capital equipment remains strong, as evidenced by Instron, for example, which was up 22%. Test & Measurement grew 12% organically. Electronics was down 4%. Moving on to Slide 6. Welding delivered double-digit organic growth of 10% in Q1 on top of 13% in Q1 last year, as equipment grew 10% and consumables were up 11%. Industrial sales remained strong with organic growth of 17%, while the commercial side was down 2%. North America grew 10%, and international grew 12%, driven by strength in the oil and gas business, which was up 15%. Operating margin expanded 110 basis points to 31.9%, a new record for the segment and the company. Organic growth in polymers and fluids was about flat against a difficult comparison of +13% last year. Automotive aftermarket was down 1%. Polymers grew 1%, and fluids was also up 1%. On a geographic basis, North America grew 1%, and international declined 2%. Turn to Slide 7. Organic revenue and construction was down 1% against a tough comparison of +21% last year. Residential construction was down 1%, and commercial construction, which represents a little less than 20% of the business in North America, was up 5%. Europe was down 9%, and Australia/New Zealand was up 3%. Finally, specialty organic revenue was down 5%, which included 3 percentage points of headwind from product line simplification. On a geographic basis, North America was down 4% and international was down 6%. Let's move to Slide 8 for an update on our full year 2023 guidance. As you saw this morning, we raised GAAP EPS guidance by $0.05 to a new range of $9.45-$9.85, which considers the lower projected tax rate for the full year in the range of 23.5%-24%. Given the level of macroeconomic uncertainty going forward, we're essentially holding our operational guidance and adjusting EPS to reflect the lower projected tax rate. Our organic growth projection of 3%-5% reflects current levels of demand, with some risk adjustment for further slowing in certain end markets. Combined foreign currency translation impact at current rates and divestitures are projected to reduce revenue by 1%. Operating margin is projected to expand by more than 100 basis points at the midpoint of our range, which includes approximately 100 basis points from enterprise initiatives and positive price cost margin impact. Like I said, we're off to a solid start to the year with some positive momentum heading into Q2, and we remain well positioned to continue to outperform in whatever economic conditions emerge through the balance of 2023. With that, Karen, I'll turn it back to you. Okay. Thank you, Michael. Rob, let's open up the lines for questions, please. Certainly. At this time, I would like to remind everyone, in order to ask a question, press star, then the number one on our telephone keypad. We'll pause for just a moment to compile the Q&A roster. Your first question comes from the line of Andy Kaplowitz from Citigroup. Your line is open. Hey, good morning, everyone. Morning, Andy. Michael, can you give us a little more color into how you're thinking about the company's margins for the year? I know you didn't change your forecast, margin, as you said, was up 150 basis points in Q1. I think you guide us to 100 basis points, you said price versus cost in Q1, I think you said, was 190 points. I know you're thinking about 100 basis points for the year. Are you thinking that should be materially higher now, especially given you're calling for a turn in automotive? What held you back from not increasing your margin forecast for the year? I think Q1, Andy, came in right along with our plan, really across the entire income statement and also on free cash flow. Q1 margins expanded 150 basis points. That's typically the low point for the year. If you go back and look historically, you'd expect margins to improve from here in Q2, again in Q3 and Q4. Based on our current planning, we expect about 100 basis points of margin improvement year-over-year in each one of the remaining quarters. Actually, across our segments, we're seeing similar trends in terms of margins improving from here. If you look at kind of the bridge, and we talked about this last quarter as well, we're certainly seeing some positive operating leverage from our organic growth this year. We're seeing about 100 basis points of contribution from enterprise initiatives. That's well within our own control based on projects and activities that are going on inside the company. We are starting to see price cost margin impact being positive. That really started in Q4, and as you said, another step forward here in Q1. We expect that to remain positive for the remainder of the year. As you know, we've diluted margins about 250 basis points at the enterprise level over the last two years, maybe we'll recover about half of that this year, so maybe a little bit more than 100 basis points from price cost. Then the delta is what we talked about in terms of the investments that we're making to support our organic growth, and including in our people. So we're certainly seeing some increases there in terms of wages and benefit increases that everybody else is seeing. That's kind of the margin picture for the year, Andy. I hope that answers your question. Yeah, Michael, that's helpful. you know, last quarter you said that 25% of your, you know, ITW businesses were slowing. Is that still the case? Did those businesses end up slowing at the run rate you projected, you know, maybe better or worse than you projected? Q1's a bit higher than you predicted in terms of seasonality. Are you still thinking sort of that 49%- 51% in terms of EPS breakdown for the year? Yeah. I think we're. If you look at what we talked about last quarter, it was about 25% of the company's revenues slowing down. Just to maybe remind everybody, we're talking about residential construction, and we're talking about commercial welding and the automotive aftermarket being down here in Q1 and kind of in the low single digits. Our appliance components business and specialty products being down in the high single digits. Semiconductor, you know, we talked about orders coming down. We're now seeing that translate into revenues coming down in that 10-15 range, primarily in the Test & M easurement segment. Q1 was actually, you know, in line with plan in terms of what we expected. We do expect some further slowing, primarily in these, this handful of businesses that I mentioned. That's not new. Yes. That's in our plan. That was in our plan, and that's included in our guidance and our plan for the rest of the year. I would just say, you know, there's a lot of strength in other parts of the company, obviously. The vast majority of our businesses are still seeing solid demand. We're always gonna have some headwind and tailwind, and it kind of all nets out to some pretty solid performance as you saw in Q1, and we'd expect the same for the remainder of the year. I'll just say this, I mean, the environment obviously this is pretty uncertain at this point. Things can change pretty quickly. Based on what we know today, we remain really well positioned to deliver, you know, solid performance here in Q2 and for the balance of the year. Mike, are you still thinking that 49%-51% split? Yeah. From a planning standpoint, I think that's still a good assumption and in line with really what we have done historically. Thank you. Thank you. Your next question comes from the line of Tami Zakaria from JP Morgan. Your line is open. Hi. Good morning. Thank you so much for taking my question. You mentioned sequentially you expect automotive margins to get better from here on. How about sales? Should we also expect the first quarter sales to be the lowest of the year and then build from here? Is there some seasonality that we should be modeling? I mean, there's very little improvement from here on out. I mean, I think it's really the growth rates year-over-year are more driven by the comparisons. If you look at, you know, Q2 last year was a meaningful decline in, or lower number in auto builds. That's going to be, you know, higher this year, we'll see some good growth in Q2 on a year-over-year basis. Sequentially, you're not gonna see, you know, significant, and certainly not an assumption baked in here in terms of significant revenue growth sequentially. Got it. Thank you so much. I'll pass it on to the next person. Sure. Thanks, Tami. Your next question comes from the line of Jeff Sprague from Vertical Research Partners. Your line is open. Hey, thank you. Good morning, everyone. Jeff. Maybe two separate topics from me. If you think about the parts of the portfolio that are, you know, still resilient and you have visibility, I think one of the uncharacteristic things maybe you saw in the last year or so is, you know, backlog build where you wouldn't typically get, you know, backlog build. I just wonder if you could speak to that, kind of your forward visibility on some of the things that are a bit later, longer cycle. Are the backlogs holding? Are you starting to burn into them? Any color on orders there would be interesting. Yeah. I mean, I think, as you point out, Jeff, we are not a necessarily a backlog-driven company. While backlogs have come down a little bit, they're still significantly higher today than kind of pre-COVID levels. Maybe not running at, 2, 3x, but at least, 50% higher in businesses like welding and food equipment, where we're still seeing a fair bit of backlog. You know, the other thing we talked about, Jeff, you know this, as supply chain continues to, you know, moderate here in terms of the challenges, you know, we're gonna see backlogs come down, and that's exactly what we're seeing across the company. I wonder if you could speak longer term to auto margins. I think you said, you know, kind of 450 basis point hit from just the price cost arithmetic and, you know, the game at, you know, catch up there. Margins are down only about 300 basis points right over the last year or so. Are you actually pointing us to kinda higher structural margins in auto on the other side of this? I know we don't get it all in 2023, but are we, are we headed to a higher place than we were, you know, a year or two ago in auto margins? Yeah, I'm not sure, Jeff, the exact comp you're referring to, but I think it's safe to say that auto margins, we see a, you know, a low to mid-20s business over the next two or three years. You know, it's a combination of great growth prospects there, the fact that all the new programs that we add are, you know, margin positive. In fact, just to put in a plug for our Investor Day in a couple of weeks, we're gonna spend some time detailing out sort of the margin path on auto in more substance. Great. That'll be interesting. I'll see you in Boston. Okay. Your next question comes from the line of Scott Davis from Melius. Your line is open. Hey, good morning, Scott, Michael, and Karen. Mm-hmm. Hey, Scott. I was wondering if you guys could give us a little bit of a window into what's going on in China. You know, I think the April PMI came in a little lighter than what folks were expecting and back down to contraction level. But they should be reopening, and I think January was probably the toughest month you had in the quarter. But you've had a chance, I'm guessing, by now to see at least an early look at April. What are you seeing there kind of just from a macro perspective and perhaps into each of the businesses, if that makes sense? I mean, I think we are, to answer your question, we're seeing a bounce back here in April, which supports a double-digit growth rate on a year-over-year basis in China here in the second quarter. You know, we did see here in the first quarter, as you point out, particularly in January, several of our customers, the automotive OEMs, as well as our, you know, restaurant food equipment businesses were slower to open up. We were definitely down in automotive OEM. I think we said 5%. We were down at food equipment. Polymers and fluids was also down kind of in that 15%-20% range. Those businesses are all coming back pretty strong here in the second quarter. you know, you'll see some big build numbers in automotive OEM China. That business could be up, you know, significantly, or will be up significantly on a year-over-year basis. Also, the comps are easier here, so we're looking at a 40%-50% growth rate in the automotive China business. Food equipment's coming back, polymers and fluids, the welding business. It all adds up to something, you know, Q2 year-over-year up somewhere around 20%, which obviously includes the bounce back from January. Maybe the little bit slower than expected reopening here in the first quarter. All right. That's, that's helpful. I want to go back to Jeff's question, I don't wanna blow up your Investor Day, so feel free to punt. What is the era of price de-escalators or, you know, price downs and the auto contracts, is that era over with and we're at least over the next five years, you envision more of a flattish price environment? Is, has nothing really changed and at the end of the day, we're gonna be back into that kind of usual down 1%-2% price dynamic? Yeah. I think it's more the latter, to be to be honest here. I think the industry has not really changed in terms of how these contracts are structured, where you get a lot of price up front. The key there is to continue to innovate and solve problems for customers in ways that nobody else can. As you win new programs and get new content on vehicles, that has to come in at a higher price. In terms of the structure of price downs every year, that has not changed at this point. Okay. Thank you for the. Yeah. -integrity of answer. I'll pass it on. Always. Your next question comes from the line of Joe Ritchie from Goldman Sachs. Your line is open. thanks. good morning, guys. Hi, Joe. Hey, can we, can we talk about your position in the, in the Chinese like auto OEM market? There seems to be a real change that's happening there, and I'm just curious, you know, how do you think your position is today? Do you need to do anything to kinda help scale the business? Just any thoughts around that would be helpful. I think as you'll see again at Investor Day, there's been a pretty dramatic shift in that, in what's been a very successful automotive business in China. The fastest growing OEMs are local, the local Chinese OEMs, and particularly on the EV side. We'll detail also at the Investor Day some of the investments that we're making to support that growth and make sure that we have enough capacity and resources in terms of our innovation efforts to continue to win in the Chinese automotive business. It is a very different business from, you know, 5, 10 years ago, but still very successful. Frankly, the organic growth prospects there in terms of above market organic growth are really, you know, some of the best inside the company. We'll... You know, Joe, we'll again, we'll spend a little more time on this at Investor Day, but we're certainly very optimistic on that business. No, that's great to hear. I'm looking forward to learning more about it. I guess the follow-on question, and I know we've talked a little bit about the margin recovery in autos, and we'll get more at Investor Day. I'm just curious, though, can you help maybe quantify how much of an impact price cost was to the margins this quarter on a year-over-year basis? I know that you're now forecasting for sequential improvement and year-over-year improvement as the year progresses, but how much of a benefit Is it expected to be as we progress through the quarters? Yeah. I think, it was a slightly negative price cost margin impact in automotive in Q1. Like I said, we're expecting this to begin to turn positive here in the second quarter. We are seeing overall deflation on more of the commodities, including resins, so nylon and acetal. Those, you know, more basic commodities, those prices are coming down. That's part of what's helping us, along with, like we said, new content coming in at higher margins. Those combined will lead to the beginning of cost recovery, you know, price cost margin recovery this year. As Scott said, this could take 2-3 years. This takes a little bit longer in automotive OEM than in other parts of the company. I'd just point out, you know, following up on Michael's comment, that our auto business still outperforms, you know, the peer benchmarks by a margin factor of 2.5x. Yeah. That the returns on capital we generate are absolutely terrific and right in line with what we do elsewhere in the company. From a long-term standpoint, you know, these are short-term issues that we'll deal with, but it's not, you know, it's not terrible by any stretch. The business still performs really well. That's true. Great. Thanks, guys. Your next question comes from the line of Stephen Volkmann from Jefferies. Your line is open. Hey. Good morning, everybody. Michael, you sort of answered a small part of my question, I'll ask the broader one. I'm curious what you're seeing across the company in terms of the cost side specifically. I think you mentioned a few of these commodities down maybe for automotive. Are there any other areas where you're seeing deflation on the cost side? The follow-on is any risk or, you know, how do you plan that going forward relative to your price? Is there any risk that kind of price follows that back down as that goes down? Thanks. Well, I think, Steve, we're seeing... I wouldn't say we're seeing significant deflation at this point. It's just costs are not going up anymore. There's maybe a little bit of deflation, like I said, in kind of the basic commodities that we mentioned. On components, you know, assembled parts, machine parts that have labor content, you know, I think the costs are gonna be a little stickier there, again, because of the labor component. In terms of our planning, we, you know, consistent with how we always do this, you know, our planning assumptions are based on all known cost increases and decreases as well as the price that we have either implemented or announced. I think we are kind of lapping, you know, these more inflation-driven price increases, and we're kind of back to normal price increases. In terms of, will those price increases stick as material costs potentially come down, I think we have only 5% of our revenues roughly is tied to an index. The vast majority, you know, we would expect to, you know, certainly be able to maintain our historical price premium. And at the same time, we want to compete, and we want to gain market share, which is really the, you know, one of the big priorities, if not the number one priority, of our enterprise strategy, which is, you know, strategic share gains to consistently grow organic growth above market. That's how I think we would frame that. Great. Okay. Thank you. Then just a quick follow-up on the construction products margins were quite a bit higher than I think some of us were looking for. Anything to call out there that was kind of margin goodness and how that sort of goes going forward? Yeah. I mean, when you see something really unusual, the answer is usually price cost. That's another segment that's been hit really hard over the last two years. actually a little bit more than the automotive segment from a margin standpoint. Here what you're seeing is we are beginning to recover the margin impact, which is what we talked about is about to start happening in the automotive business. That combined, positive price cost combined with, you know, a significant contribution from enterprise initiatives actually above the average of the company. I think they were the highest inside the company at 170 odd basis points of contribution from enterprise initiatives. Those were the two big drivers in the construction business. What's really encouraging is as we look kind of forward, this is not a one-time kind of Q1 impact. We expect to, you know, based on what the team is telling us, to sustain those margins in the high 20s%, which is pretty remarkable when you think about where we started pre-enterprise strategy, somewhere around 12%. We expect to sustain those high 20s% margins, you know, certainly in the, in the near term and, mid-term. All right. I appreciate it. Thanks. Sure. Your next question comes from the line of Jamie Cook from Credit Suisse. Your line is open. Hi, this is Chigusa Katoku on for Jamie. Thanks for taking my question. On organic growth, you maintain the 3%-5% guide. I was just wondering if the outlook by segment shifted around at all? Actually, of course, you know, we looked at this. I mean, I think we're very close to what we told you on our last call when we gave guidance for the full year. You know, we are seeing a lot of strength in automotive, food equipment, Test & M easurement, welding, construction, maybe a little bit better than what we had planned. Overall, kind of grand scheme of things, we are right in line with the assumptions that we gave you at the enterprise level, when was that? Three months ago? Last quarter. Yeah, last quarter. Okay, great. Thanks. On price cost, You mentioned that it was 190 basis points positive this quarter, and you remembered you expect it to be positive for the remainder of the year. I was wondering how we should think about cadence, just because I thought there would probably be some puts and takes with auto just beginning to recover, just going forward. Yeah. I think, you know, 190 basis points from price cost is not, that's not your normal contribution. I think we'll have, based on what we know today, another similar contribution in the second quarter, and then it'll come down in the second half of the year, just as we run into some of the comparisons around price. Like I said, net-net, we, you know, you would expect somewhere around 100 to 150 basis points for the full year, in terms of price cost margin impact based on what we know today, which obviously, there's a fair bit of uncertainty in the environment. Based on what we know today, that would be the expectation. Okay, great. Thank you. Sure. Your next question comes from the line of Andrew Obin from Bank of America. Your line is open. Hey, you have Sabrina Abrams on for Andrew Obin. Thanks for taking my questions. I think you guys were talking about seeing further slowing through the rest of the year is embedded in the guidance, particularly in the 25% of businesses that you've already pointed to slowing. Are there other areas of the business that you would flag as maybe the next shoe to drop, maybe based on current order activity? I'm not sure I understood the first. You said CA slowing? What? Oh, just like the 25% of the businesses that you've pointed to slowing. I think you said those would be the where you see particularly further slowdown in the rest of the year. I'm just wondering if there's any incremental signs of softness you're seeing in other parts of the portfolio? I think that's a simple answer. The other 75% demand rates continue to be very strong. Yeah, I think, I think Sabrina, the way maybe to think about it is that there's a lot of strength in the more capital equipment businesses: food equipment, Test & M easurement, welding. There's a lot of strength in the automotive business on the top line, which is kind of on its own cycle. Then the more consumer-oriented, more interest rate sensitive, and then semi is where there is some softness. We've been calling out that softness, really, if you go back and look, I mean, since last summer, we started to see a slowdown in construction, and it's played out in Q1 at least exactly like we thought it would. So far Q2 is off to a pretty good start. Gotcha. Then you talked about reinvesting in the business. Can you talk about where adding headcount has been more of a focus? Well, I think, it's really across the enterprise. It's, we're not favoring one segment over another. Every business, every operating unit inside the company has significant organic growth opportunities in front of them, and they make the decisions in terms of where to allocate headcount or where to add headcount in support of their organic growth strategies. There's not really, you know, one or two segments that are favored over another one. It's, every one of our 84 divisions, like I said, has significant organic growth opportunities in front of them, and they're going after those, by investing in innovation, commercial resources, and capacity to support, you know, those customers. I'll just add that, and reiterate something you said before, which is in all cases, those investments are self-funded, i.e. margins in every segment will continue to go up. Yeah. I mean, this is all part of our, you know, if you look at our long-term incremental margins in that 35%-40% range, that's after making all the investments necessary to take full advantage of the organic growth opportunities that are in front of us. Great. Thanks. Sure. Your next question comes from the line of Joe O'Dea from Wells Fargo. Your line is open. Hi, good morning. Thanks for taking my questions. I want to start just on consumables trends and what you're seeing. I think if we look at sort of polymers and specialty products and construction products, those tend to have some of the relatively higher consumables exposure across the businesses. Those are where we've seen some of the softer year-over-year organic trends. Is that really just a function of consumer exposure or also any signs of seeing some destocking maybe tied to some of these consumables? If that is the case, any visibility on what inning we might be in terms of inventory correction? Yeah. I mean, there's certainly some inventory correction going on this quarter. Last quarter, we saw that. Again, it's, you know, it's not like we're selling directly to the consumer. These are all B2B businesses, but the end market, the end consumer, or the end customer is a consumer. Those are the ones where we're seeing a little bit more softness as you said. I don't know if I have a whole lot more that I can add to that. Okay. Also just wanted to circle back on the earnings cadence over the year and talking about the 49%-51% split. I mean, it seems like it would actually imply maybe a little bit lower than normal weighting in the second quarter. Maybe the answer is, you know, you're talking about 100 basis points and it's overly nitpicking. Just want to make sure it doesn't sound like you're seeing sort of slowing relative to what you thought earlier in the year, you know, such that we wouldn't see kind of a normal-ish second quarter. No, I think, I think last quarter on this call, we talked about 49%- 51%. I think it's still kind of in our planning assumption, 49%- 51%. Again, I'll just reiterate, that's based on what we're seeing today. You know, I think, there's a fair bit of uncertainty that everybody's dealing with right now, but that's kind of our. That's our base planning assumption. Like I said, so far, you know, Q2 is off to a good start. Got it. Thank you. Sure. Your next question comes from the line of Nigel Coe from Wolfe Research. Your line is open. Thanks. Good morning. Thanks for the question. cover a lot of ground, but I did want to dig into food equipment because that continues to just really outperform quite nicely. Just curious, you know, where we are on the post, you know, reopening refresh cycle, upgrade cycle. Any thoughts there, on sort of the install base and, share gains, et cetera? I think we've, you know, we've gained a lot of share in this business, based on our ability to service and supply our customers with lead times when others maybe struggled. I think, you know, there's really nothing unusual going on in terms of the recovery. The equipment side, we'd say we have largely recovered at this point. On the service side, we're still picking up momentum. Maybe an area where we're a little constrained in terms of our ability to take care of everybody on the service side. Overall, we are continue to see some really strong demand trends in this business. This is an area, you know, we talked about backlog earlier, where the backlog is, you know, 2x our normal levels, which gives us a little bit more visibility than what we're normally than what we're used to. In terms of the end markets, as you know, our business is more focused on the institutional side. We're seeing a lot of strength there, whether it's healthcare or education or lodging, but also restaurants, up 30%+ I think we said in this, in the prepared remarks. Overall, really a lot of solid momentum here. You know, China was a little softer in Q1. As we talked about, I think that business was down about 20%. That's gonna come back here in Q2 and for the remainder of the year. Certainly a business that's performing at a very high level, including on the margin side. It's really encouraging to see the margins back in the high twenties again. Overall, I think a solid quarter and really well positioned for the remainder of the year. Oh, no question. Just to follow on- just to make another plug for... Oh, sorry, Nigel. I was just gonna add- No, please go ahead. Go Go ahead. That we will be featuring food equipment as one of the segments at our Investor Day in a couple of weeks. Just to make another plug for that event. No, that'd be great. Then just my follow-on is, just going back to auto margins. You talked about price cost. I understand that. North America was, you know, 3% growth. Europe was 17%. Just wondering if there's a mix issue as well that maybe just, you know, accentuated that margin to the downside? When you talk about sequential improvement in auto margins in 2Q, do you think that continues into the back half of the year, so we have a nice cadence Q- over- Q from here? The latter, the answer is yes. That's the current planning assumption, that margins continue to improve from here on out in automotive. I think North America, you know, you can't read too much into the quarterly build numbers, but if you look at overall builds were up, I think about 10% in North America in Q1. As you know, we are more concentrated with the D3 auto OEMs, and the builds there were up, I think about 2% in the quarter. I don't think that has a significant margin impact necessarily. As I think we've talked about before, our margins are pretty comparable across customers as well as by geography. Not a huge mix issue if you want. Okay. That's great. Thank you very much. Mm-hmm. Our last question comes from the line of Julian Mitchell from Barclays. Your line is open. Good morning, thanks for squeezing me in. I just wanted to circle back to the organic sales guide for the year. 'cause in Q1, I think you did 5%. The year sort of guided at 4. At the midpoint, the price-cost tailwind shrinks through the year, and I'm assuming therefore that the price revenue tailwind does as well. You're, you're essentially assuming sort of flat volume growth or, you know, sort of steady volume growth Q2 to Q4 with Q1 or even an acceleration perhaps. You've talked about a quarter of the business seeing a slowdown. Maybe help us understand what's the sort of the quarter of the business that's accelerating volume-wise from Q1 to offset the 25% that's slowing more. Yeah. I think what we talked about, Julian, on the last call was, you know, our guide of, you know, 3% to 5% organic. We expected that being, you know, organic growth in the first half of the year being closer to 5% and the second half closer to 3%. That's really more of a comp year-over-year phenomenon than anything else. There's no assumption here built in in terms of things accelerating in the back half. You know, our typical seasonality is Q1 is kind of the low point from a revenue standpoint. Q2, we see a step up, and then again in Q3, and then Q4 is kind of similar to Q3. That's again, those are the planning assumptions based on what we're able to kinda extrapolate as we sit here today. That- I would just add to it. Yeah, I'd just add, they haven't changed. I mean, I think Q1 came in right along with our expectations and, you know, we're kind of still right in line with that full year plan. Is it fair to assume that sort of firm wide, that price tailwind does taper through the year just as the sort of the price cost margin tailwind tapers? Maybe with the exception of the one business we talked a lot about today, which is the automotive OEM business, that's just beginning to recover. You know, we do expect that one to pick up here starting in the second quarter and then again in the second half of the year. That's helpful. Just my follow-up would be on the Test & Measurement business, where I don't think there's been many questions, but, you know, some of the peers like, say, a Techtronix or Fortive or something, you know, they were growing 20% plus in Q1. They're guiding to exit the year at flat. Just wondered on the sort of the core Test & M easurement piece, leaving aside electronics, how you're thinking about the balance of the year, in terms of that rate of slowdown. Well, I think, you know, general industrial demand for Test & Measurement equipment remains really strong. I think I mentioned Instron up 22%. Another plug for our Investor Day, MTS, which will give you a kind of a progress report, was up 14% year-over-year in Q1. Those businesses are maybe more in line with some of the numbers that you were quoting. Really the only challenges here are on the semi side, which is only about 20% of the segment. Like we said, those semi revenues are now down in that 10%-15% range in Q1. We expect some further softness here in Q2 in that part of the business. overall, I mean, I think, you know, organic growth of 6%, margins kind of in the mid-20s after digesting a lower margin acquisition, and some really good progress in this segment. That's great. Thank you. Thank you. That wraps things up. I wanna thank everybody for joining us this morning. Just a reminder, we look forward to seeing you at our Investor Day in Boston on May 18th. Thank you for participating in today's conference call. All lines may disconnect at this time.