Good morning, ladies and gentlemen. Welcome to Masco Corporation's fourth quarter and full year 2021 earnings call. My name is Renz, and I'll be your operator for today's call. As a reminder, today's conference call is being recorded for replay purposes. To ask a question, please press star, then the number one on your telephone keypad. To withdraw your question, please press the pound key. I will now turn the call over to Mr. David Chaika, Vice President, Treasurer and Investor Relations. You may begin. Thank you, Renz, and good morning. Welcome to Masco Corporation's 2021 fourth quarter and full year conference call. With me today are Keith Allman, President and CEO of Masco, and John Sznewajs, Masco's Vice President and Chief Financial Officer. Our fourth quarter earnings release and the presentation slides are available on our website under Investor Relations. Following our remarks, we will open the call for analyst questions. Please limit yourself to one question with one follow-up. If we can't take your question now, please call me directly at 313-792-5500. Our statements today will include our views about our future performance, which constitute forward-looking statements. These statements are subject to risks and uncertainties that could cause our actual results to differ materially from the forward-looking statements. We describe these risks and uncertainties in our risk factors and other disclosures in our Form 10-K and our Form 10-Q that we filed with the Securities and Exchange Commission. Our statements will also include non-GAAP financial metrics. Our references to operating profit and earnings per share will be as adjusted, unless otherwise noted. We reconcile these adjusted metrics to GAAP in our earnings release and presentation slides, which are available on our website under Investor Relations. With that, I'll now turn the call over to Keith. Thank you, Dave. Good morning, everyone, and thank you for joining us today. 2021 was another challenging year. Once again, we demonstrated the strength and resilience of Masco and our 20,000 employees across the globe. I'll start this morning with some brief comments on our fourth quarter. I'll turn to our full year results and our view on 2022. Turning to slide five, our top line increased 9% in the fourth quarter. This strong growth was led by our paint business, which delivered exceptional results and continued to gain share in both the Pro and DIY markets. Our operating profit declined in the quarter due to higher commodity and freight costs as inflation reached low double digits. As a reminder, we discussed on our third quarter call that inflation would have the greatest impact on our P&L in terms of price cost lag in the fourth quarter of 2021. Partially offsetting this inflation in the fourth quarter was good expense control, as SG&A in dollars was approximately flat, while as a percentage of sales improved 140 basis points. Our earnings per share for the quarter was $0.67. Turning to our segments. Plumbing grew 5% in local currency, with 6% growth in North American Plumbing and 3% growth in International Plumbing. North American Plumbing performed well in the quarter as we continued to see good demand for our faucets and shower products, particularly through the e-commerce channel. Our spa business also continued to see strong demand for its outdoor wellness-oriented products that have a tremendous appeal to today's homeowners. In International Plumbing, Hansgrohe drove growth in many key markets, including China and the U.K. In our Decorative Architectural segment, Behr continued its tremendous performance with mid-single-digit growth in DIY paint and over 50% growth in Pro paint. We continue to see good demand for both DIY and Pro paint, and our operational excellence has enabled us to gain share in this supply-challenged market. Our lighting and bath hardware businesses also contributed to growth and margin expansion in the quarter. Now let's review our full-year performance. Please turn to slide six. For the full year, total company sales grew 17% and operating profit increased 11% with an operating margin of 17.4%. Strong volume growth and pricing realization was partially offset by high single-digit inflation and a return to more normalized investments in marketing and personnel to support our growth. Our Plumbing segment grew an outstanding 22% excluding currency, led by strong growth at Delta, Hansgrohe, and Watkins. Our Plumbing business is well-positioned to continue to outperform the market with its leading brands, new product introductions and operational excellence, and enters 2020 with healthy backlogs. In our Decorative Architectural Products segment, full year growth was 6% against a 12% comp as our business grew mid-single digits with DIY down mid-single digits and Pro up over 30%. Pro paint now accounts for approximately 30% of our paint business. Behr enters 2022 with a lot of momentum. Our relationship with our channel partner is extremely strong, and we are committed to mutual growth. Our Behr brand was recently named the most trusted paint brand by an independent third-party market research firm. Our Pro paint business continues to gain share in the market and outperform the competition. Our recently launched Dynasty line of paint is performing exceptionally well. As we exit 2021, we have won shelf space in a number of adjacent paint categories, such as aerosols, interior stains, and caulks and sealants, all of which will help to drive growth in 2022 and further demonstrates the strength of our brand and partnership with our customers. Turning to capital allocation. Our strong cash position and cash generation allowed us to deploy nearly $1.3 billion in capital during the year. We repurchased $1 billion of our stock at an average price of $58.31 per share. This represents approximately 7% of our outstanding shares. We increased our annual dividend 68% and paid approximately $211 million in dividends to shareholders. We completed the acquisition of Steamist for approximately $56 million, and we finished the year with over $925 million in cash and net leverage of 1.3x, providing us ample financial flexibility and firepower. Our strong operating profit growth, combined with our significant capital deployment, resulted in exceptional financial results. We increased earnings per share by 19% to $3.70 per share. We delivered adjusted free cash flow of approximately $900 million with a conversion rate of 90% despite an increase in working capital due to inflation and supply chain tightness. We achieved a return on invested capital of approximately 47%. I want to thank all our 20,000 employees across the globe for their outstanding efforts throughout 2021 to deliver these exceptional results. No summary of 2021 would be complete without mentioning the significant ongoing supply chain and inflation challenges. Once again, I'd like to thank our tremendous suppliers who worked with us through these unprecedented challenges of 2021. As we exited 2021, supply chain challenges have marginally improved. However, shipping delays and labor constraints remain a challenge. We experienced high single-digit inflation overall in 2021 and expect inflation to remain persistent and to increase in 2022 as higher raw material, freight, and labor costs flow through our P&L. Importantly, however, we exited the year on a price-cost neutral basis, except for additional increases in freight and logistics that occurred during the fourth quarter. We have initiated actions to cover these additional logistics price costs with price. The price cost impact in Q1 will be significantly improved as compared to the fourth quarter of 2021. Now turning to 2022, I'd like to share with you our view of the markets where we compete. For the North American repair and remodel market, we expect market growth to be in the mid-single-digit range. For the paint market, we expect the DIY paint market to grow mid-single digits and the Pro paint market to grow low double digits. For our international markets, principally Europe, we expect a low single-digit growth environment. These expectations across all markets include significant price. The repair and remodel market remains strong and leading home improvement indicators are robust. Home price appreciation was 18% in December, and existing home sales increased over 8% compared to prior year. Each of these metrics has a strong correlation with our sales on a lagged basis. Based on these assumptions and our expectation that we will continue to gain share and outperform the market, we anticipate Masco's growth to be in the range of approximately 4%-8%, excluding currency for 2022. We expect margins to expand modestly to approximately 17.5%, despite a significant margin headwind from pricing to recover cost and normalization of investments in the business as we continue to grow. Turning to capital allocation, our strategy remains unchanged. First and foremost, we will invest in our business to meet the current and future demand for our products. As we announced last quarter, we are expanding our production capability in Europe with a new faucet and shower plant for Hansgrohe. Additionally, we are adding manufacturing and distribution capacity to our spa and paint businesses to support our strong growth. These investments will likely increase our capital expenditures to just above our normal level of approximately 2%-2.5% of sales on average, keeping in mind that CapEx was only about 1.5% in 2021. In terms of returning cash to shareholders, based on the strength of our business model and cash generation capabilities, our board declared a quarterly dividend of $0.28 per share, a 19% increase, which would bring our annual dividend to $1.12 per share in 2022. We'll deploy our free cash flow after dividends to share repurchases or acquisitions. Based on our strong liquidity position and our projected free cash flow, we expect to deploy at least $600 million to share repurchases or acquisitions in 2022. Lastly, there is no change to our M&A strategy. We continue to review and selectively pursue opportunities that have the right strategic fit and the right return for Masco. With our expected operating profit growth, strong pricing to recover costs, and continued capital deployment, we anticipate earnings per share to be in the range of $4.10-$4.30 per share, representing 14% growth at the midpoint. Now, I'll turn the call over to John to go over the fourth quarter, full year, and 2022 outlook in more detail. John? Thank you, Keith, and good morning, everyone. As Dave mentioned, my comments today will focus on adjusted performance, excluding the impact of rationalization and other one-time items. Turning to slide eight. Demand for our industry-leading brands remained robust, and we delivered a strong finish to the year, with sales increasing 9% in the quarter against a healthy 13% comp in the fourth quarter of last year. Net acquisitions and divestitures contributed 2% to growth, and currency had a minimal impact. In local currency, North American sales increased 11%, or 7% excluding acquisitions. Our team's outstanding execution drove strong growth in both DIY and Pro paint, as well as faucets, showers, and spas. In local currency, international sales increased 3%, or 5% excluding acquisitions and divestitures. Our gross margin of 30.7% was impacted by higher commodity and logistics costs in the quarter. As we discussed on our third quarter call, price cost in 2021 had peak impact on our P&L in the fourth quarter. Our SG&A as a percentage of sales improved 140 basis points to 17.6% as we continued to drive cost containment activities across our business. Operating profit in the fourth quarter was $265 million with an operating margin of 13.1% and our EPS was $0.67. Turning to the full year 2021, sales increased 17% over prior year. Net acquisitions and divestitures contributed 3% to growth, and currency contributed another 1% to growth. In local currency, North American sales increased 14%, and international sales increased 21%. Our SG&A as a percent of sales decreased 100 basis points to 16.9%. Operating profit increased $148 million or 11% with an operating margin of 17.4%. Lastly, our EPS increased 19% to $3.70. I want to thank our employees across the globe for their hard work, dedication, and commitment to safety that enabled us to achieve these outstanding results in another challenging year. Turning to slide nine. Plumbing growth was 5% against a strong 14% comp in the fourth quarter of last year. Net acquisitions and divestitures contributed 3% to this growth, and currency had a minimal impact. North American sales increased 6% in local currency, or 1% excluding acquisitions. This performance was aided by Delta's continued strength in their growing e-commerce channel and increased selling prices. Watkins Wellness was also a significant contributor to growth as they continued to experience strong demand for their industry-leading spas. International Plumbing sales increased 3% in local currency or 5% excluding net acquisitions and divestitures. Hansgrohe grew sales in many of their key markets, including China and the U.K. Segment operating profit in the fourth quarter was $156 million, and operating margins were 12.7%. As we discussed on our third quarter call, operating profit was impacted by an unfavorable price cost relationship along with creative marketing and personnel expenses as we continue to invest to grow our Plumbing businesses. Turning to the full year 2021, Plumbing sales increased an outstanding 24%. Net acquisitions and divestitures contributed 4% to this growth, and currency contributed another 2%. In local currency, North American Plumbing sales grew 22%, or 17% excluding acquisitions, and International Plumbing sales increased 21%, or 22% excluding net acquisitions and divestitures. Full year operating profit was $931 million, up $118 million or 15%, an operating margin of 18.1%. Turning to slide 10. Decorative Architectural sales increased 15% for the fourth quarter, or 14% excluding acquisitions. Our DIY paint business grew mid-single digits in the quarter against a high teens comp in the fourth quarter of last year. Our Pro paint business grew more than 50% in the quarter, driven by strong professional paint demand and operational execution resulting in share gains. We expect Pro paint demand to remain strong as contractors continue to see growing demand for their services. We also anticipate increasing our penetration with the Pro by continuing to invest along with our partner at The Home Depot in new services and programs to retain and grow the Pro customer. Our builders hardware and lighting businesses also contributed to the segment's overall growth in the quarter. Operating profit was $132 million in the quarter, up $23 million or 21% with margins expanding 80 basis points to 16.6%. This performance was driven by higher net selling prices, improved results in our lighting business, incremental volume and cost productivity initiatives, partially offset by higher commodity costs. Turning to the full year 2021, sales increased 6% driven by exceptional performance of our DIY and Pro paint businesses as our team did an outstanding job at effectively managing through numerous supply chain constraints throughout the year to deliver for our customers and gain share in the paint market. Full year operating income increased $41 million or 7%, with margins expanding 20 basis points to 19.4%. Turning to slide 11, our year-end balance sheet is strong, with net debt to EBITDA at 1.3x. We ended the quarter with approximately $1.9 billion of balance sheet liquidity, which includes full availability of our $1 billion revolver. Working capital as a percent of sales was 16%. With our strong operating performance and a lower than normal CapEx, adjusted free cash flow was nearly $900 million, representing 90% of adjusted net income. This is a strong result when considering the significant impact of inflation and supply chain disruptions on our working capital investment throughout the year. Finally, during 2021, we repurchased more than 17.6 million shares for over $1 billion, and we increased our annual dividend by 68%. Now, let's turn to slide 12 and review our outlook for 2022. For Masco overall, we expect sales growth in the range of 4%-8% excluding foreign currency, with operating margins of 17.5%. Operating profit will be unfavorably impacted in the first half of the year as we experience the impact of a more normalized level of growth investments as compared to the first half of 2021. For our Plumbing segment, we expect 2022 sales growth to be in the range of 3%-7% excluding foreign currency. Given current exchange rates, foreign currency is expected to unfavorably impact Plumbing revenue by approximately 2% or $90 million. We anticipate full year Plumbing margins will expand to approximately 19%. Margins in the first half of 2022, particularly in the first quarter, will be impacted by higher year-over-year marketing and personnel expenses as we comp against our strong margins in the first half of 2021. For our Decorative Architectural segment, we expect 2022 sales to grow in the range of 6%-10%. Looking specifically at paint growth for 2022, we currently anticipate our DIY business to increase high single digits and our Pro business to increase mid-teens. We anticipate full-year Decorative Architectural margins to be approximately 18%. As we have previously discussed, in this segment, pricing actions typically only recover the dollar amount of the inflation. As a result, all else equal, operating profit dollars remain neutral from cost recovery pricing actions that results in margin compression. During 2022, we also anticipate increased investment in this segment for marketing and new products that will drive future growth. Finally, as Keith mentioned earlier, our 2022 EPS estimate of $4.10-$4.30 represents 14% EPS growth at the midpoint of the range. This assumes a 240 million average diluted share count for the year. Additional modeling assumptions for 2022 can be found on slide 15 in our earnings deck. With that, I'll now turn the call back over to Keith. Thank you, John. 2021 was another dynamic year. We navigated it well and delivered exceptional results. As we enter 2022, we are poised to continue this trend of proven execution. Masco's focused business model of low ticket repair and remodel products with market leading brands and product and geographic diversification provides growth and stability through cycles. We leverage our consumer insights, broad channel relationships, scale, diversification, and our Masco Operating System to drive innovation and make our businesses better. The repair and remodel industry is an attractive industry with favorable long-term fundamentals. Growth on average is approximately GDP + 1%-2%. Cyclical factors such as home price appreciation and existing home turnover have a high correlation with repair and remodel activity. Structural factors such as demographics, the age of the housing stock, and how consumers view their homes can also drive increased repair and remodel activity. We are on the leading edge of the large 75 million millennial cohort forming households and entering the housing market. 2.7 million more homes will reach the prime remodeling ages of 20-39 years old over the next three years. The COVID-19 pandemic has clearly increased the desire for more enjoyable living spaces, which has led to increased home demand and remodeling expenditures. All of these structural forces provide tailwinds for our business. As we previously outlined, our long-term outlook is comprised of above-market organic growth in the range of 3%-5% annually, growth from acquisitions in the range of 1%-3%, margin expansion each year through cost productivity and volume leverage, and continued capital deployment in the form of share buybacks should contribute approximately 2%-4% to EPS growth. Together, we expect this to result in EPS growth of at least 10% per year through cycles, plus dividend returns of approximately 1%-2%. With favorable fundamentals and our continued focus on executing our growth strategy, together with our strong free cash flow and capital deployment, we are positioned to continue to drive shareholder value creation for the long term. With that, we'll now open up the call for questions and answers. Thank you. In order to ensure that everyone has a chance to participate, we would like to request that you limit yourself to asking one question and one follow-up question during the Q&A session. To ask a question, please press star then the number one on your telephone keypad. To withdraw your question, please press the pound key. Our first question comes from the line of Kenneth Zener. Your line is now open. Good morning, everybody. Morning, Ken. You guys obviously got the cost pressure. If we could really just narrow in on architectural paint where you have PPI up in the low teens, obviously, you know, there's some percentage of COGS there. Can you expand a little bit given the inflationary environment we're in, you know, talk to the dynamic between units and price to the extent you feel comfortable, given inflation, it's warranted, I think. Can you also help us understand, right, with so much price there, it seems like volume might not be high, and you're actually getting pretty good margins because, you know, other paint manufacturers have faced a lot of pressure because of the absence of volume. It doesn't seem like that's such an issue with you. If you could discuss that dynamic in that business a little more, I think we all would appreciate it. Yeah, Ken, let me take a crack at the price volume part of the question, and maybe John can contribute as I go through this. Without a doubt, price was a healthy contributor to the growth in the quarter, as we and many others implemented price to offset, as you mentioned, the significant raw material inflation that we've experienced and frankly continue to feel. After a volume decline, let's say in Q3 for the segment, volume has increased in Q4, and we expect that trend to continue into 2022, despite, as you know, tough comps that we've had from 2021. I will point out, however, and we've mentioned this consistently, that when we get price, typically, we get price to cover the cost increase of the baskets in terms of dollar impact. That does represent some margin headwind for us this year, and we will continue to experience that. We put price into the market and have covered our costs. We expect some margin headwinds, so that's consistent with what we've talked about. However, we are seeing some volume improvement, and we expect that to continue to occur. Yeah, yeah, Ken. The only thing I would add to Keith's good comments are kind of two with respect to the performance specifically in the fourth quarter. One specifically to the fourth quarter and then one into 2022. So if you look at the margin expansion that we experienced in the fourth quarter, you know, a good chunk of that is attributable to the improved performance of Kichler during the quarter. They improved significantly compared to their results in the fourth quarter of last year. Maybe just one other comment to emphasize what Keith said about 2022 for paint. You know, we continue to experience inflation, and we think we're gonna experience further inflation here in 2022 as paint raws continue to inflate. We'll have to continue to work through those challenges as we go through 2022, but we feel confident in our position. Right. Appreciate that. I guess sticking with paint, it doesn't sound like you had as much material constraints perhaps as the industry. If that's the case, obviously you have great relationships with your supplier. The flip side to that is, can you really expand? You had such success in the Pro category. Can you just give us a better sense of why it's not just supply access that's giving you the share gain? Expand on your confidence in your success to date, if you would, on that Pro paint. You've obviously cracked the nut there, I believe. Thank you. It's been tough without a doubt. It's, you know, there's no one single thing I would point to. There's, as I've talked in the past, I think we have an outstanding research and development department in our coatings business that has been able to work through challenges as it relates to changes in inbound supply and being able to take on different suppliers. We have a tremendous supply base, and those companies that we have long-term, and I'm talking 20+ years relationship with, have done phenomenal things for us and continue to do phenomenal things. I can't thank our supply chain enough. Of course, the folks in our company, at Behr and throughout our businesses that have really worked incredibly hard and really put good thinking to how to manage through this crisis. It hasn't been without its challenges. I mean, we're far from perfect, but we've done pretty well. I think at the end of the day, we've demonstrated operational excellence and what the Masco Operating System can do these past couple quarters. It's afforded us the opportunity to get more of our paint into more professionals' hands. When that happens, it's good for us. As I said, we've recently been awarded again some nice accolades around service. You're well aware of the awards that we've received in terms of our quality, and our Net Promoter Score and our experience, et cetera. We have a very good product, and it's been beneficial for us to be able to leverage our supply chain excellence and our supply base and our people to get more people to try it. As I said, when pros try it, they tend to like it. We're up against tough competition, there's no question about it. I'm very confident in our outlook of mid-teens growth in Pro paint for 2022. Thank you. Thank you. Our next question is from the line of Michael Rehaut with JP Morgan. Please go ahead. Thanks. Good morning, everyone, and congrats on the results. Wanted to, for the first question, just get a sense of, and I'm sorry if you covered this earlier, the cadence, get any type of sense for the cadence throughout the year, you know, from a margin and growth, sales growth perspective. Specifically, I'm thinking about, you know, the Plumbing segment margins. You know, you've had a couple of quarters now of year-over-year margin declines. Not sure if we should be thinking that might, you know, continue at least in the first quarter. You know, any comments around, you know, top line cadence given the tougher comps in the first half. Yeah, Mike, it's John. I mean, I'll take a crack at this and, Keith, feel free to jump in. As you think about margins for 2022, Mike, compared to 2021, just given the strong comps that we faced in the first half of the year and the fact that the way the inflation rolled out through 2021, with it not really impacting the P&L too much in the first half of the year and being much more significant impact to our P&L in the back half of the year. What that leads us to believe is that as we go into 2022, you kind of see a mirror image of 2021, meaning we'll add a little bit more margin pressure in the first half of the year as we recover costs to offset the inflation. As we lap the inflation and go into the back half of the year, we should see margins expand in the back half of the year. In terms of top line cadence, you know, I'd say it's fairly balanced through the year. You know, not a significant you know difference between first half, second half of the year, Mike. It feels you know pretty straightforward at this point. You know, we like where we're positioned. You know, as Keith mentioned in his prepared remarks, you know, we're seeing you know good growth both domestically and internationally. We feel good about where Plumbing's positioned, and we do expect some margin expansion in 2022. Mike, I think, you know, in probably that low single digit type of growth environment and our expectation is that. Mike, maybe one, just one last piece. You know, bottomed out in Q[audio distortion] improvement in Plumbing margins is.[audio distortion] Okay. No, thanks. That's very helpful, guys. Appreciate it. Maybe secondly, obviously the last two quarters [audio distortion] And you're now forecasting for double-digit growth in 2022. You know, obviously you had an announcement by a competitor [audio distortion] Adding Pro paint to Home Depot, in addition to yours. You know, was hoping maybe just to talk about the announcement, you know, your own deal with Home Depot or just more broadly, and why you're still expecting this stronger rate of growth, if it has to do with your share in the product that's been favorable for you for the last couple of quarters, if that's gonna continue, and any competitive dynamics on the Pro paint side. Yeah, Mike, I'll start. The recent announcement doesn't change our strategy or outlook in any way. The relationship really hasn't ever been better. We're committed to mutual growth. We have significant discussions around our strategy and how we're gonna continue to drive that together. The relationship is really strong. We're not losing any shelf space. The recent news is mainly switching out of some other products in the aisle, not replacing ours, so it's not a shelf space issue. We're confident in our paint business for the reasons that we talked about. When you have the best quality and the best brand and the best service, hands down, that's a good sales pitch for us. That plus the fundamentals of the market, both cyclical and structural, give us, you know, plenty of reason to feel very good about our paint business. Additionally, we've won some shelf space in adjacent categories as well, which further demonstrates the strength of our quality and our brand and what the consumer thinks about it, things like, as I mentioned, aerosols, interior stains, caulks and sealants, stuff like that. There's plenty of reasons to feel good about our paint business, and we do. Great. Thank you. That's from the line of Adam. Please go ahead. Hey, thanks for taking my question, everyone. Just on the inflation piece, I know you mentioned it was up low double digits in the fourth quarter. What are you assuming in your 2022 guidance, and maybe by segment would be helpful? Sure. Let me take a crack at that, Adam. You know, overall, like we said, you know, inflation for 2021 was kind of high single digits. As we look into 2022, we do expect the impact to be up modestly from 2021. It could be low double digits in the first half of the year. That said, if we specifically look at paint, we do think it's gonna be up over 20% for the first part of 2022, so first half of 2022. We are expecting, I should say, this inflation to continue at least in the first part of the year. Got it. Thanks. You talked about Kichler driving the margin expansion in decorative overall. If we just isolate paint, were those margins down year-over-year in the fourth quarter? No. Paint margins were not down year-over-year. Got it. Thank you. Thank you. Our next question is from the line of Mike Dahl with RBC Capital Markets. Your line's open. Thanks for taking my questions. I wanted to stick with paint. Keith, in the opening remarks, you made a comment about, you know, having some wins and gaining some shelf space in aerosols, stains, caulks. I'm wondering if you could give us any sort of sense of magnitude of what the impacts from those will be, within your guidance, from a top line standpoint. You know, when we think about margin impacts, I know you've said a couple times now on paint, you know, keeping in mind that it's dollar cost, not margin, neutral on inflation. I'm wondering whether these adjacencies are comparable margins, or should we think about the margin profile a little bit differently, and if that's having any impact. What I'm most excited about with these additional spaces that we're getting into is it really highlights the strength of the Behr brand. It really serves as more of a billboard for us in the aisle and builds momentum with regards to the overall brand. Honestly, in terms of the overall size of these wins, at least for now, compared to our overall paint business, it's not that big of a win, and I'm not gonna get into the specific margin breakdowns of it. In terms of the price cost relationship as it relates to price recovery for costs only and not getting margin on that, just to kind of give you a little bit of the back of the envelope math, a 5% increase in cost where we recover only the cost but not the margin equates to about 100 basis points of margin erosion. That gives you a flavor for the kind of challenges we're looking at and the dynamics that we have. The new wins, you know, they're not that large compared to the overall market, our overall segment now, but I think very positive for us for the reasons I mentioned. Okay, great. Yeah, that makes sense. Thanks. My second question is on the investment side. It sounds like there's a step-up in both Plumbing and Decor when we think about investments, whether it's personnel or other investments around marketing. Can you help us then kind of quantify from a year-on-year standpoint how those investments look by segment? Yeah, Mike. Yeah, on that one, you know, it's just the continuation. It's modest, you know, in terms of the ongoing investment we've put. You know, as we talked about, for 2021, we're looking to put about $40 million back into the business. Most of that was gonna be in the Plumbing segment. I'd say we've made progress along those lines. I'd say the dollar amount, we still have some room to go in terms of that investment as we go into 2022. But I wouldn't say it's, you know, significant from here. Yeah, you know, we're keeping a close eye, Mike, on these investments as we feather them back in to make sure we're getting the return for them. In 2022, while we're increasing in the spend area, our SG&A as a percent of sales should still hover around that 17%. In terms of capacity, you talked about, I think you asked a little bit about where that investment is going. Our CapEx typically averages in for a number of years. For the next couple of years, we'll probably be on the high side of that range. The large projects that we announced, as they come online, will have capacity to reinvest in our business. That's the best return we get. It's the least risky, and it's the one we have the most confidence in. These capital investments will be spaced over the next coming years, and as I said, should put us towards the higher end of the range for a couple of years. All right. Thanks, Keith. Thanks, John. Thank you. The next one we have on the line of John Lovallo with UBS. Please go ahead. Good morning, guys, and thank you for taking my questions. The first one, just to dovetail off of Mike's. You know, when would you anticipate reaching that sort of normalized SG&A run rate? The investments that you're speaking of, just to be clear, are they contemplated in that $40 million, or is there, you know, incremental on top of that? Hey, John. No, there's not incremental on top of that. I'd say we'd probably be in that, you know, on that. We're just gonna meter that investment in as we see how demand shapes up for 2022. Okay. Got it. That's helpful. You know, with the Watkins back very strong at the end of the year, how should we sort of think of the potential benefit to Plumbing margin with that backlog flowing through? I think I'd point you to our overall guide for the Plumbing, right around that 18%. Yeah. You know, John, as you look at that business, you know, I would say that, you know, the Plumbing's at, you know, to correct it, Plumbing's closer to 19% than 18%. I would expect, you know, that volume, as you look at that business, just given the strength of it, you know, will flow through pretty consistently through the year. You know, it is gonna be a contributor to us achieving that 19% margin, but it's not gonna drive us, you know, well north of that just given that strength of those backlogs. Got it. Thank you. Thank you. The next one we have on the line of Susan Maklari with Goldman Sachs. Your line is now open. Thank you. Good morning, everyone. My first question is, can you just give us some color across the business of where inventory sit as you come into this year? Recognizing that you don't oftentimes have extended backlogs in most of these operations, but any commentary on the backlog and, you know, your thoughts on the ability to sort of catch up this year as the supply chains continue to improve. We've made a little bit of improvement, but I'd say, Susan, it's a mixed bag. If you look across the different products, the channels, the geographies, I would say, generally speaking, that we're still a little bit light. So that might represent a little bit of tailwind for us. But really we're getting back fairly close to where we wanna be, but there's a little bit of upside, I would say. Okay. All right. That's helpful. You know, as we think about the longer term trajectory of the businesses, especially in terms of the margins, can you talk a little bit about where you think the business can continue to go over time? You know, it feels like we are sitting with a certainly stronger housing backdrop, you know, over the longer term as we go through. You're obviously doing a lot of initiatives around new products, those kinds of company specific efforts. How do we think about what that will mean for you over time and where things can go? You know, I'd first point to the last couple of years and say these have been some strange times, obviously with fairly significant inflation this year with the COVID initial austerity program, where we really cut back at the beginning of the pandemic to keep a sharp eye on liquidity to a very much a spike in demand, if you will, or where people over time throughout the pandemic had a different view of what their home meant to them and what they were willing to invest in their home and how they wanted that to look and feel. It has been a strange past couple of years for sure, to state the obvious. As we look forward in the business, our margins are pretty good. Our mantra is to continue to improve them. That improvement will not come in hundreds of basis points chunks. It'll come in rather modest improvements over time. Fundamentally, we have a drop down in that 25%-30% on the base volume, and then we're gonna continue to invest for growth. In some cases, those investments, like we've talked about in the past, come ahead of the growth, and we earn our way into that. As we think about the competitive forces, we think about the value of our drop down, we think about the need to improve or invest incrementally in future growth. We're committed to slight margin expansion as we move through the years. Okay. That's helpful. Thank you, and good luck. Thank you. Thanks. Thank you. The next one, we have the line of Phil Ng with Jefferies. Please go ahead. Hey, guys. John, you were really kind to give us some color on how to think about the margin progression on Plumbing. Any hand-holding on the DAP segment? You know, appreciating you're probably seeing a lot more inflation to start the year. When we look out to 2023, assuming inflation kind of stays steady and not pull back, is there an opportunity to kind of get that back to that 19% range over time? You know, Phil, you know, as we look at, you know, the Decorative Architectural segment for the year, I'll tell you a couple things. You know, one, obviously, if you look at the cadence of our progression in 2021, obviously we faced some pretty significant headwind in the second quarter, just given the challenges from the Texas freeze in Q1 of last year, and so that impacted our Q2. As you think about, you know, both our top line and our bottom line for 2022 as compared to 2021, you know, I think you're gonna see better growth in the first half of the year than in the back half of the year. A lot of the- That's due to some of the pricing that we put in during 2021, as well as the relatively soft comp that we had in the second quarter of 2022. As you think about the margin progression for 2022, again, recall some of the comments that both Keith and I made about how as we recover the dollar cost of the inflation, it's gonna impact margin. You know, with that segment, I would expect to see. You know, we talked very openly about the margin compression, and we really don't see that really getting much better as we go through the year. I mean, I think it's probably more of a first half weighted will probably be more impacted than the back half, all depending on where inflation goes. So, you know, that's how we're seeing it now with you know. We're very confident though in the 18% margin. You know, as we think about the fourth quarter, we probably did see a little bit of margin compression on the paint side, just given that price cost recovery action that we talked about earlier. You know, Phil- Got it. This is Keith. Sorry, go ahead. Go ahead, Keith. I would tell you that this is not a static environment. I think, you know, we certainly have a view of where the overall inflation is gonna be, and we base our plans on that. We have a commitment to price cost neutrality, and we've demonstrated the ability to get that and all those things. It's not static. I mean, as John alluded to in the fourth quarter, we had high-teens% raw material inflation in paint in the fourth quarter. We think that's gonna be in the mid-20%, you know, still to come here in the first quarter of 2022. There's some moving parts here, and we need to continue to work through them. Yeah, that's fair. It's, I mean, a lot of inflation, so you're managing through that. When we think about rate hikes, certainly seeing a lot of volatility in the equity markets. Keith, I think your business should be a little more insulated. I'm curious how you think about that impacting your business, and any way to kind of parse out your sales guidance for the full year, how much is price versus volumes? Yeah. You hit the nail on the head, Phil. We have made significant changes, and by design have reduced the cyclicality of Masco. Less cyclical, more resilient. Less distance peak to trough, less time peak to peak. So that we believe, and it's demonstrated that the R&R market is more correlated with home price appreciation, existing home turnover, consumer confidence and the like, versus interest rates, particularly with many repair and remodel projects not financed with mortgage debt. So we believe that dynamic alone provides some pretty good insulation from concerns about rates. There's the structural factors, and you think about the demographics and the number of homes. You know, you think back to that, 2002,2006 times, those are now starting to age to that juicy age of, you know, 16-20 years, where significant remodeling occurs. That structural aspect and the COVID impact in terms of how people are viewing the house, plus the millennial cohort coming in, as I talked about. You know, we feel that through our design work on the portfolio and what that portfolio now depends on in terms of the consumer re- Price versus volumes. Yeah, Phil, you know, I'd say, you know, both will contribute to growth. I'd say in this inflationary environment, price will be more impactful than volume in 2022. We still are looking at volume. I think. Across both segments. Yeah, as John said, price will be the majority of it. Okay. Thank you. Really appreciate the color, guys. Thank you. The next Stephen Kim with Evercore ISI. Your line is open. Yeah, thanks much. Appreciate it. Just wanna clean up a couple of things here. One thing in paint, I believe you mentioned. I think you alluded to the fact that you expect some additional inflation in the segment generally, sequentially, like from here. I just wanted to make sure that I was understanding that, if what's included in your guidance there, the $1 million impairment, the goodwill. I was just wondering what that was related to. Sure. You know, Stephen, in terms of inflation, you're right. Yeah, we do expect additional inflation from here as, you know, we are continuing to see inputs, both titanium dioxide and resins continuing to inflate as we enter 2022. We do expect that to continue to increase in 2022. As it relates to the charge that we took, that was related to Kichler has enjoyed improved performance in 2021 and a return to growth and naturally had some nice both productivity and profit improvement in the year. You know, as a result of the inflation that impacted the business, you know, both initially starting in 2019 with the tariffs as well as then in 2021 with what took place, you know, with the inflation and how it overall impacted the business. We made the determination that it was appropriate to lower the carrying value of the business and took the non-cash charge in the fourth quarter. That said, you know, we like how the team has performed. We like how the business is standing today. We feel much better about how this business is positioned. Okay. Is there any goodwill remaining in Kichler at this point? There's a small amount of goodwill that's remaining, Stephen. Okay, great. Then you walked through the cadence, I think in sales, in DAP, and I was just wondering related to the top line, particularly in Plumbing, when we kinda look at your growth, trying to cut through the pandemic, you know, year-over-year gyrations. It looks like your fourth quarter could on a, you know, multiple year stack basis could have a pretty nice year-over-year increase. There's also some normal seasonality in that business too. Just kinda curious, you kinda made the case that in DAP there'd be a little bit of chunkiness, I think, in terms of the sales growth. Looks like particularly in 2Q. Is there anything like that in Plumbing? Should we think that the sales growth organic will be, you know, pretty stable throughout the year? It should be pretty stable throughout the year with maybe a little bit, you know, better in the back half of the year, Stephen. You know, I don't think there's not a meaningful driver to make a huge distinction between the first half, second half. Okay, that's helpful. Okay, thanks very much. Thank you. The next one, we have the line of Garik Shmois with Loop Capital. Please go ahead. Hi. Thanks for taking my question. Apologies for the short-term focused question here first, but just wondering if you're seeing any pronounced absenteeism related to COVID and if there's any production inefficiencies that impacted 4Q or could impact 1Q. Yeah, we're still struggling with that. I would say, towards the back half of the year with the Omicron variant that it increased and fairly typical of what the rest of the country is seeing. We are seeing elevated absenteeism at our factories, and it's happening in our supply base as well, so that remains an ongoing challenge. I've just looked at some recent data, and it appears that it's starting to wane, but you know, we'll see. I know that our approach is that we expect this type of absenteeism to continue, and we've got to figure out ways to best manage it. Yeah, it's an ongoing challenge. There's no question. Garik, that was more of a Q1 comment than a Q4 comment. Okay, great. Okay, thanks for the clarification. Follow-up question is on pricing. You talked about putting through pricing to offset some recent transportation costs. You also talked about increasing inflation, particularly in paint. I'm just wondering if your guidance assumes the need for additional pricing from here or does it assume all the pricing actions that you already put through is gonna be enough to drive the margins in your outlook? Yeah, I mean, Garik, what we're seeing, particularly with some of the inflation, you know, that continues. It looks like we'll need. You know, we've put in a lot of pricing to date, but you know, we likely foresee the need for further pricing actions as we go into 2022. I see. Thank you very much. Thank you. We have time for one last question, and it would be from Eric Bosshard with Cleveland Research. Your line is open. Thank you. Curious in the Plumbing segment that North American growth was slower in 4Q than I think we had seen in what was a strong year. Just curious in that business in 4Q and into 1Q, what you're seeing go on in terms of consumer demand or channel fill or product mix, specifically in that business. Yeah, it continues to remain strong. You know, our incoming order rate, our backlogs are solid. Importantly, we have not seen, if you will, a trade down in the mix as it relates to a reaction to the significant price that we and others are putting in the market. Where we sit right now, it's pretty stable. Great. Thank you. That's all I had. I'd like to thank you for your continued interest in Masco and joining us on the call this morning. That concludes today's call. This concludes today's conference call. Thank you for participating. You may now disconnect.