Good day, and welcome to the Pool Corporation Fourth Quarter 2024 conference call. All participants will be in a listen-only mode. Should you need assistance, please signal conference specialist by pressing the star key followed by zero. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star then one on your touch-tone phone. And to withdraw your question, please press star then two. Please note this event is being recorded. I would now like to turn the conference over to Ms. Melanie Hart, Senior Vice President and Chief Financial Officer. Please go ahead, ma'am. Thank you, and welcome to our Fourth Quarter and Year End 2024 earnings conference call. Our discussion, comments, and responses to questions today may include forward-looking statements, including management's outlook for 2025 and future periods. Actual results may differ materially from those discussed today. Information regarding the factors and variables that could cause actual results to differ from projected results are discussed in our 10-K. In addition, we may make references to non-GAAP financial measures in our comments. A description and reconciliation of our non-GAAP financial measures included in our press release are posted to our corporate website in the investor relations section. We have included a presentation on our investor relations website to summarize key points from our press release and call comments. Peter Arvan, our President and CEO, will begin our call today. Thank you, Melanie, and good morning, everyone. This morning, we released our full year and fourth quarter 2024 results, reflecting sales slightly better than our earlier expectations and solid execution by our teams. As construction and remodeling activities remained under pressure, we focused on providing an unmatched customer experience, driving growth in our maintenance business, including double-digit growth in our private label chemical sales and continued development and deployment of our Pool360 ecosystem and tools. We believe that consumer spending on discretionary, especially that which requires financing, continues to remain a headwind. While still preliminary, we believe new pool construction will land at approximately 61,000 units for 2024, which equates to a 15% decline in new units compared to last year. From the pandemic-driven peak to the most recent data, we have seen new pool construction decline by approximately 50% in units, with declines also observed in renovation and remodel. Considering this, along with the general economic headwinds, we are pleased with our team's ability to gain share in a tough environment. We believe our share position has grown, driven by our best-in-class team, solid execution, unmatched value proposition, and continued investment in a resilient industry. Now, I would like to recap our full year and fourth quarter results. For the full year, we delivered $5.3 billion in revenue, down 4% from 2023, and slightly above our latest guidance, driven by a tremendous team effort in creating an unmatched customer value proposition. Our gross margin finished the year at 29.7%, reflecting weaker product mix as higher gross margin construction and remodel-related products represented a smaller portion of our total revenues, along with some competitive pressures and customer mix impacts, which Melanie will comment on in her remarks. We generated operating income of $617 million, operating margin of 11.6%, in line with our expanded 2020 operating margin and operating cash flow of $659 million. We consider this a solid achievement while continuing our strategic technology investments, sales center network expansion, and overcoming higher operating cost inflation over this period. We generated diluted EPS of $11.30 a share, including a $0.23 ASU tax benefit. For the fourth quarter, total sales were $988 million, down 2% compared to last year, continuing the year-over-year sequential improvement we demonstrated throughout the year. Gross margins improved 10 basis points to 29.4% compared to the same period last year, and we generated operating income of $60.7 million, operating margin of 6.1%, and diluted EPS of $0.98 per share, including a $0.01 ASU tax benefit. Breaking sales down by geography for the full year, Florida came in flat, while we saw mid-single-digit decline in the other year-round markets. Florida showed resilience throughout the year and in the fourth quarter outperformed our other markets with 12% growth. Repair and replacement activity following Hurricanes Helene and Milton provided some weather-related benefit to Florida's fourth quarter results, but the storms likely delayed some construction and renovation activity. Our remaining year-round markets saw sales decline ranging from 3%-7% in the quarter. Similar to what we observed throughout the year, maintenance-related sales held up well, while construction-related products saw pressure, particularly in Texas and California. For Horizon, net sales declined 6% for the full year and 4% for the fourth quarter. Stronger commercial irrigation projects, along with maintenance-related sales, offset softness in the residential construction activities. Considering PVC pipe deflation impacts, volumes came in mostly flat for Horizon for the fourth quarter, which we consider an encouraging and improving trend. For Europe, sales declined 9% for the full year and 5% in the fourth quarter. We noted year-over-year sequential improvement during the 2024 swimming pool season in Europe. Onto our product categories, chemical sales increased 2% for the year and 8% in the fourth quarter. As mentioned, mid-teens growth in our private label chemical sales supported our ability to grow overall chemicals greater than the increase in the installed base. Fourth quarter sales were lifted by post-storm cleanup efforts in Florida but continued to show growth across the overall business. At the winter industry shows, we also unveiled our new chemical branding and marketing plans, which will create even more demand for these best-in-class products. Complementing this, we introduced branded test strips that will work with our private label consumer app, which is new for the 2025 season and will allow us to drive additional growth through our dealers for our proprietary products. Building material sales declined 10% for the full year and 8% in the fourth quarter. Considering the estimated 15% decline in new pool units constructed, these results are strong indicators that our value proposition, our proprietary NPT-branded pool and tile finishes, our expansive outdoor living offering, the power of our model, and superior tools and expertise provide support to our builders. Equipment sales, which exclude cleaners, were flat for the year and up 6% in the fourth quarter. As expected, maintenance-related equipment demand remained steady, and the fourth quarter included heightened repair and replacement activity in Florida. Not only during this critical recovery period, but also throughout the year, our supply chain teams worked very closely with our vendors to improve inventory vitality and fill rates while reducing days on hand. We have invested in people, processes, and technology that helped deliver a better customer experience and solidified the confidence that we will effectively deliver needed products when they are needed most. Turning to end markets, our commercial pool product sales continued to grow with 9% growth both for the full year and in the fourth quarter. We continue to invest in capabilities that allow us to take a larger share position in a very technical market. Our recent investments, which include acquisitions, inventory, and talent expansion, will allow us to continue delivering growth in commercial aquatics. Sales to our independent retail customers declined 4% for the full year, but were up 1% in the fourth quarter. Pinch A Penny retail sales, representing our franchisee's sales to their end customers, increased 4% for the year and 15% in the fourth quarter. While the franchisee's sales to end customers have been steady throughout 2024, most Pinch A Penny stores are concentrated in Florida, where a significant amount of storm-related repair and replacement activity occurred in the fourth quarter. Orders through our B2B Pool360 application increased to 12.5% in the fourth quarter compared to 11% the same time last year. As we introduce new and improved versions of our Pool360 Water Test and Pool360 Service tools, we consider this metric and private label chemical product sales to be the most meaningful indicators of success in the early adoption and ongoing utilization of these tools and applications. Also noteworthy, our pool water chemistry test recommended over 1 million product applications to consumers through our dealers in 2024 to balance pool and spa water. Over the long term, we see Pool360 Service as a revolutionary opportunity to help our maintenance customers grow their business and create efficiencies and productivity in their operations and in ours. We remain focused on tactically expanding our widespread and fully integrated sales center network. In 2024, we opened 10 new locations and added two more through acquisitions, bringing our total count to almost 450 sales centers. Our Pinch A Penny franchise network added 11 new stores, including 7 in Texas, for a year-end network total of 295 stores. With the growth of our Pinch A Penny network, we have added additional capabilities, and as of the end of 2024, our operating distribution points specific for continued franchise growth in both Dallas and Houston. Penny will open our first store in the Arizona market in the coming weeks and has developed distribution capabilities to support this market and future expansion in the western Sunbelt. Now, I'd like to frame up our view of the 2025 market and outlook. Our teams delivered solid results in 2024, executing on our strategic initiatives to grow share in both our steady maintenance-related business and to capture available new pool and remodel work in a weaker discretionary spending environment while investing in our capabilities that further differentiate our customer experience. Our expectations for 2025 are no different under the present macroeconomic conditions. The current interest rate outlook is not likely to benefit our industry in the near term. Having said this, our dealers continue to communicate inquiries on new pool construction and discretionary remodel projects are solid, but when financing is involved, we believe consumers tend to remain hesitant. As in 2024, we expect maintenance-related product sales to be steady, offering some growth potential from the 2024 increase in the installed base, modest inflation, and continued market share gains. In the meantime, we remain aggressive in helping our customers grow their business and providing an unmatched customer experience. Breaking down our top-line expectations, we expect total sales growth for 2025 to be relatively flat up slightly. Growth components include benefits from inflation of 1-2%, some maintenance-related product sales growth, and continued market share expansion. Moving to the discretionary portions of our business, currently, we expect new pool construction in units to be relatively flat. While around 60,000 units may be close to the bottom, the uncertain economic environment makes it unclear how quickly entry-level financing-dependent consumers will return to the market. Renovation and remodel activities should be stable in most markets. Over the past two years, remodel projects have been lower in number and scope, indicating separation of projects or a pullback of more highly featured comprehensive project spending. Deferred remodels will likely be a growth opportunity as the economy improves, but we remain cautious at the present time. Taking these factors into consideration, our 2024 guidance for diluted earnings per share is $11.08-$11.58 per share, including an estimated $0.08 ASU benefit. Melanie will go into more details on the remainder of our P&L assumptions and capital allocation plans in her prepared remarks. Looking out beyond 2025, we're fortunate to operate in an industry that grows upon itself. Each year, new pools go into the ground, creating growing demand for the products we sell to maintain and improve those pools every day. Continuing to invest in expanding our sales center footprint, developing enhanced technological tools that differentiate our value proposition, creating productivity for us and our customers, and introducing new products are instrumental in growing our business. With our intense focus on serving the pool service professional, pool builder, and DIY markets through our incredible dealer base and the Pinch A Penny franchise, we can continue to grow our share through all economic cycles. Additionally, the long-term factors that position outdoor living as a growing industry continue to thrive. Southern migration, the growing millennial and emerging Gen Z home buying population, a housing shortage, and technological advancement support a favorable long-term growth outlook. As I reflect on how we have emerged from our significant growth cycle post-pandemic, I see a company that has strategically expanded its footprint, grown its revenue base by $2 billion, increased margins, accelerated the growth of a franchise network, acquired and increased the utilization of a vertically integrated chemical repackaging plant, and developed technological tools to help both service and retail customers grow and enhance their productivity. Our widespread distribution network, combined with our four central shipping locations throughout the U.S. and fully integrated ERP system, differentiate us and allow us to efficiently provide our customers with the products they need when they need them, along with unmatched expertise to help them grow their business. We are larger and more strategically positioned and integrated than anyone else in the industry. As I wrap up, I want to especially thank the Pool Corp team. Their ability to adapt to their dynamic environment, focused on what they can control and propel our growth forward, gives me great pride. I also want to thank our vendors. Our commitment to them and the industry is unmatched, and we truly value the partnerships. Lastly, I want to thank our customers for helping homeowners reap the benefits of outdoor living, and I will now turn the call over to Melanie Hart, our Senior Vice President and Chief Financial Officer, for her prepared remarks. Thank you, Peter. I'll start with a quick recap of our fourth quarter results to highlight our 2024 accomplishments and then discuss our plans for 2025 based on today's environment. Sales reflecting a 2% year-over-year decrease for the fourth quarter continued to show an improving trend from the beginning of the year, where we were down 7% in first quarter, 5% in second, and 3% in the third quarter. Fourth quarter included an additional selling day, which fell into December, therefore having little impact on the overall results for the quarter. Peter commented on the outperformance we saw in Florida, primarily weather-driven, which had an approximately 1% benefit in quarterly sales. Similar to the second and third quarters, we estimate a net 1% inflation benefit. Positive realized pricing was offset by lower selling prices for chemicals and commodities over the same quarter last year. Sales continued to be impacted by the lower levels of new pool construction and repair and remodel activity, which contributed to an estimated 5% comparative decrease in sales, mitigated by positive volumes in maintenance products. Gross margin of 29.4% was consistent with prior year fourth quarter of 29.3%. Product mix related to lower sales of building materials continued to dilute margin, similar to what we have seen throughout the year, and were balanced by year-over-year improvements from pricing and supply chain actions. Fourth quarter operating expenses increased by $15 million, or 7%, over last year, including certain timing shifts of costs from the third quarter of 2024, the 10 new sales centers opened during the year, and our incremental technology investments. Operating income of $61 million compares to prior year operating income of $79 million. Operating margin was 6.1% in the quarter compared to 7.9% in the prior year. Diluted earnings per share for the fourth quarter was $0.98 compared to $1.32 in the fourth quarter of 2023. We are pleased with the outcome of our full year 2024 results and the way that we have managed the business in a year with continued macroeconomic pressures and lower levels of consumer discretionary spending. We maintained our significantly stepped-up 2020 operating margin compared to historical results, even with sales contracting and our commitments to expanding our footprint and technology services to our customers. This was accomplished by continuing to make the right choices to focus on the long-term growth and profitability of the company. Solid earnings combined with excellent working capital management, including a $76 million reduction in inventory, propelled our operating cash flow generation to almost $660 million. Our capital allocation for the year included 10 Greenfield sales centers and two acquired sales centers, 11 new Pinch A Penny franchisee stores, increased capabilities in our Pool360 ecosystem, a $103 million reduction in debt outstanding, and $483 million returned to shareholders through dividends and share repurchases. Net sales of $5.3 billion continues to represent our leadership position in the outdoor living space. The 4% sales decrease was primarily driven by the approximately 15% decrease in new pool construction units and over 10% estimated decrease in pool renovation and remodel spend. Collectively, these impacted top-line sales by around 5%. Maintenance held up very well overall, with volume improvement ahead of the growth in the installed base of pools and realizing about 2% pricing from pass-through of vendor product cost increases. Chemical and commodity pricing have offset the positive pricing impacts by 1% for an overall 1% net pricing benefit. Unfavorable weather during the first part of the year had some offset in the fourth quarter for an overall impact of less than 1% for the full year. Lower sales at Horizon Europe resulted in an additional 1% decrease. We estimate that our 2024 pool product sales were around 64% in maintenance items, 22% used for renovation and remodel, and 14% for new pool construction projects. This compares to 2023, where the breakout was closer to 62% maintenance products, 24% renovation and remodel, and 14% for new pool construction. Our sales for products we track for use in new pool construction and remodel saw less of a decrease than the overall market, as our building materials product finished the year down 10%, even including negative impacts of pricing. We continue to believe that our long-term gross margin target of approximately 30% is achievable in a normalized industry growth environment and would expect that to vary seasonally. We achieved a gross margin of 29.7% for 2024 compared to the 30% realized in the prior year. In 2024, product mix mostly related to lower levels of new construction and customer mix, where our larger customers fared better overall than our smaller customers, negatively impacted gross margin. These fluctuations were offset by positive contribution realized from the reversal of previously recorded import taxes, pricing benefits, increased private label chemical sales, and a return to normal for purchase-related volume incentives. Specific to product mix changes, our building materials as a percentage of sales represented 12% of sales in 2024 compared to 13% in 2023. Our operating margin at 11.6% was consistent with our 2020 operating margin of 11.8%. This includes the incremental investment in technology, or 18 basis points impact to 2024. The comparison here is important in that we have maintained profitability after a period of sales contraction while managing through much higher levels of cost inflation. Our operating expenses increased 5%, or $45 million, to $958 million. Included in the increase was approximately $32 million of future growth levers, comprised of the $20 million related to technology and $12 million for the addition of the 10 new Greenfield sales centers. The remaining $12 million, or around 1.5% increase, represents significant capacity creation efforts, where we were able to control volume-related expenses, utilize our footprint, gain operating efficiencies, and control the increase in total operating expenses to a much lower rate than the inflationary cost impacts to the business. We had an ASU benefit of $8.8 million, or $0.23 per diluted share for the full year, of which $0.01 was added in the fourth quarter. Excluding ASU, our full year tax rate was 25%. We finished the year with earnings per share of $11.30 for 2024, which was 15% lower than prior year reported EPS of $13.35. Excluding the ASU benefit, our EPS of $11.07 was a decrease of 16% compared to $13.18. Coming off of a record cash flow from operating activities of $888 million in 2023, we achieved 2024 cash flows of 152% of net income. We reduced inventory a larger percentage than the sales decrease, even while providing stock for our 10 new locations. Cash flow in 2024 includes $68.5 million of deferred tax payments for those impacted by Hurricane Francine, which will be paid in the first quarter of 2025 and lower the cash flow for that period. Even without the tax timing benefit, cash flow from operations exceeded net income by 36%. Next, I'll recap key areas on our balance sheet. Day sales outstanding of 26.3 days was favorable when compared to 2023 DSO of 26.8 days. Year-end accounts receivable of $315 million compares favorably by $28 million, or 8%, from prior year. Our inventory balance of $1.3 billion was $76 million less than the prior year balance of $1.4 billion. The 6% reduction exceeded sales changes as our efforts related to supply chain initiatives continued to add value. Days in inventory was 129, a decrease of 6 days from prior year. Total debt outstanding was reduced by $103 million, from $1.05 billion to $950 million. The debt reduction was funded by operating cash flows and was achieved even with over $59 million of capital purchases for new and existing locations, funding of our technology initiatives, acquisitions, a 9% increase in the quarterly dividends, and $304 million in share repurchases. We finished the year with a leverage ratio of 1.4, slightly below our target leverage range of 1.5 to 2 times. We completed total share repurchases of $304 million, including $144 million in the fourth quarter, contributing to a 2% reduction in weighted average share outstanding compared to 2023 year-end. The total amounts returned to shareholders for the full year, including dividends and share repurchases, was $483 million, second only to 2022. Despite a challenged business environment and pressured earnings, we have returned almost $1 billion to shareholders through dividends and share repurchases in the past two years. Turning to our outlook for 2025, at this time, we are not anticipating a quick recovery in sales trends. From a macroeconomic standpoint, we are entering 2025 with higher-than-historical interest rates, possibilities of increased costs, and continued inflation impacts, and an unclear path for consumers to return to more normalized levels of discretionary spending in the pool and irrigation space. As proven in 2024, our steady maintenance business will continue to benefit from new pools added during the prior year, even without a meaningful improvement in new construction and repair and remodel activities. Pricing based on pool season updates from vendors across our product portfolio is expected to have a blended 1%-2% benefit, with some continued drag in first quarter for chemicals and commodities. Our sales outlook range for 2025 is flat to a low single-digit increase. As we do not have a significant amount of direct imports, we do not anticipate that the currently enacted additional tariffs from China will have a material impact on sales for 2025. The vast majority of our products are purchased domestically, however, may include some portion of goods that could see cost increases if further tariffs from Mexico or Canada were to be passed. We will include any estimated impact of future tariffs in our guidance when we receive cost increases from our vendors and can reasonably estimate the potential effects. As we have historically, we would expect to pass these cost increases through as additional selling price. Our gross margin for 2025 is expected to be within the range of our 2024 gross margin and our long-term guidance target of 30%. On a comparative basis, in 2025, contributions from our success in supply chain management, pricing, and increased private label sales are expected to offset the positive import tax included in 2024. Based on trends as we exited the year, we are not anticipating a significant increase in new pool construction and remodel activity. Thus, product mix is not expected to have a significant positive benefit to 2025 gross margins. On the expense side, we continue to see higher-than-normal growth in wages, rent, and other operating costs that the management team will continue to focus on to offset these cost increases with improved productivity. The stepped-up level of focused investment in technology will continue in 2025 at a similar level as 2024 and is considered a core part of our customer value creation efforts. We expect an incremental $10 million of costs associated with new sales center expansion in 2025 as we continue to add to our distribution network. As we start to see market recovery in top-line growth, we expect some incremental incentive-based compensation, where a low single-digit top-line would result in around $15 million of incremental compensation expense. We expect that interest expense will range from $40 million to $45 million based on current rates and excluding any share repurchases. Interest expense is typically higher in quarters one and two as we build inventory to support the swimming pool season. The improvement from 2024 is primarily driven by lower expected average debt levels estimated at current interest rates. We have included around $50 million-$55 million for our depreciation and amortization estimates. Capital allocation plans include use of cash of around 1%-1.5% of net sales on capital reinvestments into the business, including new sales center openings. We plan for between $25 million-$50 million on acquisitions. Once approved, our dividends will utilize cash of around $200 million, as we would expect to continue to repurchase shares opportunistically. Cash flow in 2025 is expected to be between 90% and 100% of net income and will be impacted by the $68.5 million deferred tax payment made in the first quarter of 2025 related to 2024. Our annual tax rate is estimated to be approximately 25%, excluding ASU. This rate typically runs closer to $25.5 million during quarters one, two, and four, and lower in Q3. We are projecting an 8% benefit from ASU in the first quarter for the expected impact of restricted share vesting and stock options expiring in 2025. We expect approximately 38 million weighted average shares outstanding that will be applied to net income attributable to common shareholders at the end of the first quarter and 38.1 million shares for the remaining quarters before consideration of any additional share buybacks. Our guidance for 2025 is a diluted EPS range of $11.08-$11.58, including an estimated $0.08 ASU tax benefit. From an operational standpoint, excluding the benefit of the $12.6 million import tax on the 2024 results, the improved earnings at the midpoint would be around 4%. First quarter 2025 will include one less selling day than prior year for a total of one less selling day for full year 2025 compared to 2024. From a seasonality standpoint, with Easter falling later in the year, this typically would shift pool openings from first quarter to second quarter in some markets. Last year's first quarter included the $12.6 million of benefit to gross margin related to import taxes. This will provide a negative comparison for 2025, as we would expect a normal seasonal gross margin for Q1. As we look forward to the 2025 season, our team is prepared to capitalize on the stable maintenance portion of our business, continue to capture incremental market share, and adjust to business and economic changes that will position us to outperform the market. When new construction and remodel activity return to more normalized historical levels, we will be ready, as we have made the investments necessary to continue to grow faster than the overall market. I appreciate all of you particip ating in today's call. We will now open the line for questions. We will now begin the question and answer session. To ask a question, you may press star then one on your touch-tone phone. If you're using a speakerphone, please pick up your handset before pressing the keys. If at any time your question has been addressed and you would like to withdraw your question, please press star, then two. We ask that you please limit yourself to one question and one follow-up. And if you have further questions, you may re-enter the question queue. And at this time, we'll pause momentarily to assemble our roster. And the first question will come from Susan Maklari with Goldman Sachs. Please go ahead. Thank you. Good morning, everyone. Morning, Susan. Good morning. I want to talk a bit about the Pool360 initiatives and some of the momentum you're seeing there. Can you talk about how that will contribute to your outlook for sales to be flat to approximately up this year? And then I think Melanie mentioned in her comments that you expect to spend on those investments about flat year over year, but anything notable within that that we should be aware of in terms of some of the key initiatives and how they're coming through? Yeah. We're very pleased with the traction that we're seeing on Pool360. And remember, the ecosystem has many parts. So in our comments, we mentioned that at this point, we are considering new construction to be kind of flattish. It's very early to tell where new construction will end up, but right now, we're assuming flattish. So we lean into the maintenance portion of our business. The maintenance portion of our business is our private label chemicals play a large role in that. As we mentioned, one of the measures of the effectiveness of Pool360 is what's happening to our private label chemical sales, and you can see that they've increased quite a bit. What we think is that the tools prescribe our proprietary chemicals and that regardless of the construction and remodel and renovation environment, we think that's going to continue to pay dividends. Now, that's a function of the number of pools in the ground and largely weather will determine the length of the swimming pool season. So what we think is that it provides a very effective way for the consumers, either with our new app or using the Pool360 Water Test at our dealers' stores using the proprietary software that we have at the stores, or the new Pool360 Service, which we think will drive efficiency of the maintenance companies that are running the software, which allows them to run their business. So overall, we think it makes them more efficient. We think it makes them stickier to us in terms of customer base, and we think it drives sales of the proprietary products because it only recommends our products, not anybody else's. Right. That's great color. Thank you. And then maybe shifting to Pinch A Penny, given the macro backdrop and all the pressures that the consumer continues to be under, are you seeing that there's growth on the DIY side of the business at all or any shift in that? And what that means for Pinch A Penny, their ability to gain share, and the implications for the margins as a result of that? Yeah. Maybe kind of ironically, there hasn't been a big shift of people turning away from professional service companies to DIY. Every year, a certain amount of customers will flip-flop back and forth. Some people say, "Well, I can do this," and then they try and take it over themselves. If they do it if they're uninformed about how to do it and they don't use some of the apps that we have, it can be problematic. So overall, I would say not a lot of shifting back and forth between do-it-for-me and DIY. I mean, the value proposition that any retail store has is providing a great customer experience. Pinch A Penny provides a great customer experience. They're owner-operated, just like our independent stores, which tend to provide the best overall customer experience. So they make it easy for the customers to shop. They're effectively located in the right area where the swimming pools are. They're fully stocked. They have the software and technology, which ensures that the consumer should have the most trouble-free pool. But overall, the growth in Pinch A Penny and a well-run independent retail store has to do with the overall customer experience that they provide. Okay. That's helpful. Thank you. Good luck with everything. Thank you. The next question will come from Ryan Merkel with William Blair. Please go ahead. Hey, good morning. Thanks for the questions and congrats on the strong finish of the year. I had a couple of questions on guidance. So I think, Peter, I was a little surprised to see the outlook for new construction units flattish. And we've got the high interest rate environment, and I believe the pool permits are still down a good bit. So just talk about why you think flattish is the right outlook. And then is it more second-half weighted? Should it still be down in the first half? Yeah. I think that's right, Ryan. Our dealers that we've spoken to earlier in the year, you know it's show season, so we interact with a lot of dealers in the first eight weeks of the year. And what I would tell you is that their reporting activity is good. Now, certainly in the Northeast, which is a very small portion of the market this time of year, they got winter. Now, last year, their winter came later in the first quarter and was pretty good. In the beginning of the quarter this year, it's cold and snowy everywhere. I mean, hell, we got snow in Louisiana. So I think you're right. The sentiment that we're getting from the dealers is that they think that it's not going to get any worse. But I do think you're right. It feels to me like the general sense of the economy is that it's probably going to be better in the second half than in the first half. Okay. Got it, and then on gross margin, that was also a surprise for me. You're guiding it flat up. And just talk about how you're achieving that because I think product mix will be a negative, and then you've got the accounting headwinds. So what are the offsets to those items? Yeah. I mean, the offsets are the specific actions that we're working on. So we have several things on the supply chain side that we've continued to develop and put in place in 2024 that we see some future benefits coming into in 2025. And then, as Peter mentioned, we rolled out several new categories of private label products. And so we did that at both our sales conference internally as well as the trade shows that we've been attending early in the year. And so it's going to be focused on really kind of supply chain. It's going to be increase in private label and then the continued efforts that we're making on the pricing side as well. Got it. All right. I'll pass it on. Thanks. Thank you. The next question will come from Scott Schneeberger with Oppenheimer. Please go ahead. Thanks very much. Could you, Melanie, for you, go back over the competitive pressures that you touched upon and also customer mix and how you're thinking about both of those entering the year and over the course of the year? Thanks. Yeah. So as we've seen kind of throughout the year and really kind of starting in 2021, with the growth in the swimming pool industry, we have seen private equity kind of enter the market in kind of across the different avenues into the industry overall. And so one of the things that we've seen is some growth in our national accounts where we have seen some consolidations there. And so what we've seen there is those customers are able to capture a larger share of the market overall because they have better reputations within their individual markets. And so that's really allowed us to focus from a national standpoint on serving those customers and one of the avenues that we see as further improvement in our market share because we are better able to serve those customers. Thanks very much. And Peter, for you, just specifically on remodel, what are you hearing as far as what your customers are saying about the homeowner? What's implied in your assumptions for interest rates and how you thought about the guidance for that? And just anecdotally, what you're hearing there, what you think the behavior will be from the homeowners this year given where we are in the housing market? Thanks. Sure. I would tell you you have to bifurcate the market, so to speak, when it comes to renovation and remodel because it really depends on the customer type. So if you have a cash customer, then the pool is ready to remodel, and they go out and engage a contractor, and they make it happen. Ones that have a significant portion of financing because remember, we talked about remodels on previous calls, remodels have also come up in price quite a bit too. So a new equipment pad could be $14,000-$15,000. A pool finish could be for a small pool, $9,000-$10,000. Tile, a couple thousand dollars. And decking, it really depends on the size of the decking. So many remodel projects could get pretty large. And when that happens, more and more consumers will seek to finance part of that. So in the current interest rate environment, but for somebody that has to do a remodel because repairs aren't getting it done anymore, meaning that the finish is beyond its useful life, and that's where somebody will say, "Okay, I may not want to do it, but I have to do it to preserve the asset," so to speak. So I think that cash buyers, that market is okay, was okay, is okay, similar to the cash buyer for new pool construction. What I will say, and I mentioned in my comments, is I believe that once interest rates come down, I would expect to see renovation and remodel be a source of growth for our dealer base because I believe that in the last couple of years with elevated rates, people that probably should have remodeled have delayed that. And remember, we consider renovation and remodel to be semi-discretionary, meaning I should do it, but I don't really have to do it this year. Perhaps I can forestall it for a year or two, but eventually, it'll have to get done. So I think that as we move forward, given the install base continues to age every year regardless of interest rates, I think this will be an area that we'll lean into for growth. Great. Thanks. Best of luck. The next question will come from David Manthey with Baird. Please go ahead. Thank you. Good morning, all. First question is on the weather. How are you thinking about the weather in 2024 as a comp for 2025 overall? Because precipitation throughout the season was pretty normal, but the temperatures in April, May, and June were pretty much record mild levels. And I understand it wasn't a capacity situation for new construction or R&R in 2024, but wouldn't a good weather season be generally a positive for both the green and all three areas of the blue business, all else equal? Yes. Okay. Fair enough. So a little bit tougher comp in 2025, but that's incorporated into your guidance. Yeah. I mean, you know you've been covering us for a long time. Weather is, in this business, especially early in the year, has some pretty wild swings. Once we get into the season, generally, it's pretty normal. Weather affects us much more on the shoulders of the year. Yep. Yep. Got it. Okay, and then maybe you could recalibrate us on your strategic thoughts around Horizon. I mean, looking out 5 to 10 years, what does the green business look like? Are you just looking to get deeper in the Sun Belt? Are you looking to expand nationally? And then secondarily, where does Horizon fit in the range of capital allocation priorities that you have as a company? Great question. So Horizon is a business that is much more heavily dependent on new construction, new home construction specifically, than the rest of our business. So we all know that new home construction has been underbuilt for many years and that there is a housing shortage. So I think from a cyclical perspective, Horizon is in a spot right now that there is a net need for new homes. I think the interest rate and housing market overall has that locked up a bit. But given that the population continues to grow, and I believe that the long-term outlook on rates is that they will come down and the housing market should unlock, I think that business will thrive in that type of environment. The environment we're in today, frankly, as I mentioned in my comments, the commercial business in Horizon is in better shape than residential. So from a capital allocation perspective, we're not opening a ton of branches. We are protecting our competitive position in markets where we need to expand and/or we may need some capacity, but we remain focused largely on the Sun Belt. I don't really want to have, at this point, business outside of the Sun Belt for Horizon. It doesn't take a lot of capital to run that business. Given that our competitive footprint in most of the key markets is pretty good, we don't need to put a bunch of capital into new locations. Now, if the new home construction market takes off in the future years, then yes, we may add to the footprint. But largely, I don't see the new home construction market taking off outside of the Sun Belt. I think the best chances to see a growth in that would be in the Sun Belt, and we would follow. Thanks, Peter. Good luck. Thank you. The next question will come from Andrew Carter with Stifel. Please go ahead. Hey, thank you. Good morning. Just first wanted to ask about kind of the commodity pressures. You did say, just to be clear, you lumped in chemicals plus PVC, but any building materials. Can you kind of level set where you've taken steps down in terms of the chemical pricing? Have you seen anything incremental? Obviously, well, there's SRS out there under Home Depot's ownership right now. Leslie's actually talking about getting more sharp on price points. So just kind of level set where we are and what's kind of considered in the guidance right now. Yeah. So right now in the guidance, we do expect to see some continued pressure on both chemicals, PVC, and to a lesser extent, the building materials. So I do think that building materials may have worked its way out primarily through 2024. On the chemical side, we exited our selling pricing in first quarter or a little bit less than where they were at the end of 2024, but comparatively different from where they were first quarter, so we're definitely going to have that impact in first quarter, year over year. As is typical in first quarter, we do see from a competitive standpoint offers out in the market of lower selling prices to try to generate cash for those that need to turn inventory into cash and to get people to come in the door in first quarter. It's not much different that we're seeing this year first quarter than we saw last year, and really, by the time the season hit, that kind of normalized because people weren't leading with pricing on those chemicals anymore. So that would be kind of a similar assumption to what we would look for for the rest of 2025 as it relates to that. PVC piping, that one is continued under pressure. It was down year over year, 20%-25% for the full year. Still down some, not a significant part of our business overall, but we're not seeing any recovery in that at this point. So could be a slight impact on deflation for the rest of the year. The second question, you're talking about the flat new construction for the full year. And I think you said at a certain point that's predicated on pressure on the entry levels not coming back. I guess there's a second. There's a positive to that, which is the increased content rich, feature rich that mix tailwind. Your building materials were down 11% last year. New construction was down 15%. Do you see that providing kind of a healthy benefit? Is that in your guide? Is that upside to the guide of continued? And have you seen any of that go back, i.e., any of the pools that are being built by the higher end? Are there any sacrifices, or it is just as, "Okay, if I have the money to build a pool, I'm going to build a pool, and I'm going to build what I want"? Thanks. Yeah, I think that's generally right, Andrew. If you have the money to build a pool, you want a pool, you're more than likely to put in the available technology today. You're not going to try and go back to an older platform. And quite frankly, most of the builders wouldn't do that anyway. As far as the overall price of a pool, I think it's being skewed by a couple of things. One is content, and two is just the type of pools that are being built. I think we're seeing more and more or continuation, I should say, continuation of the number of pools being built on average being the larger, more feature-laden pools than entry level. I think there's healthy demand for entry level. We expect it to turn at some point. And quite frankly, that's why we've been continuing to invest in our business, because we realize it's a cycle, and we don't want to be when the cycle turns, we continue to gain share. And when the cycle turns, then essentially that's when we're going to get paid back for these investments in new locations and other investments that we've made in our customer experience. Thanks. I'll pass it on. Thank you. The next question will come from Trey Grooms with Stephens. Please go ahead. Good morning, everyone. So just real quick, Melanie, on the operating expenses, you went through several puts and takes around that, and clearly there's several moving pieces this year. Could you talk about maybe the timing of some of these factors or maybe how we should think about the cadence of operating expense as we move through the year? And sorry if I missed any details on that. I broke out for just a second or my call disconnected for just a second. Yep. No, I appreciate the question. So the two areas that we are investing in specifically for 2025, one is going to be the addition of a similar number of new sales centers, and that we expect to spend about $10 million. So we will see the majority of that come through kind of before season. We are fairly far along in opening up a little over half of that in before season, so before April, May. So you'll see that kind of heavily weighted to first quarter, second quarter. And then the rest of it will fall into the fourth quarter. We typically don't open up anything kind of in the middle of the season. So that's how I would split those expenses. And then on the incentive comp side, that we actually record in proportion to our operating income when we earn it. So it would have a similar seasonal spread to our overall operating income. Got it. Okay. And then maybe I guess this could also kind of lend itself to the similar question on timing, but you'd mentioned some rebuild demand in Florida from hurricanes expected. Have those come through yet, or how are you thinking about the timing there? And then also with back half expectation for maybe a leveling or maybe even a little improvement in the new side and R&R, should that impact the normal seasonality that we typically see? Yeah. Related to Florida, what I would say is there's still areas in Florida that need a significant amount of work that we're still when the homes aren't rebuilt, then they're not going to rebuild the pools, right? So any place where the home was still habitable, then those pools were as quickly as possible put back online so that people can use them. There's still a fair amount of pools and homes in Florida which are uninhabitable, and those pools will be future work for us once the homes get fixed or rebuilt. There's a lot of those homes, they're going to have to be raised and rebuilt versus just repaired given the elevations of when those homes were originally built. So that for us is just going to continue to be future work, right? It'll grow as people continue to move to Florida and the homes that were damaged get rebuilt. As far as your question on the second half versus first half of the year, I would say that certainly I believe the second half, our current thinking is that the first half new construction, I mean, we say overall flattish. I think that the first half is going to be weaker than the second half. We're anticipating that the second half will be a little bit stronger. It's very early in the season, very tough to predict right now given the amount of uncertainty that there still is in the economy. But based on the level of optimism that we sense with the dealers, that's currently what we are thinking. When I consider our first quarter of the year and I look at the weather patterns, as I said, last year, weather in the beginning of the quarter or beginning of the year was actually very good for the first quarter. And then the end of the first quarter, winter came and stuck around for a few weeks into the beginning of the second quarter. We don't know where we're going to end this year as far as first quarter weather, but it looks like we're getting a real winter up north. But fortunately for us, this is not the most seasonally significant time of year. Right. Okay. Got it. Thanks. I'll pass it on. Good luck. Thanks. The next question will come from Garik Shmois with Loop Capital Markets. Please go ahead. Oh, hi. Thank you. The $25-$50 million you're budgeting for M&A, I was wondering if you could talk to some of the opportunities that you're looking at. Yeah. I think at this point, it's really in the same area that we continue to invest in. I think there's some opportunity for continued consolidation, albeit not nearly as much as there was, say, five or six years ago. So we have an M&A deck that we continue to work and have conversations with people, but I wouldn't expect at this point anything out of the ordinary. Okay. And then I was hoping you could speak to labor availability on the new construction side. If we start to see growth, whether it's in the second half of this year, maybe in 2026, what you're hearing from contractors given the administration's new policies on immigration and if there's any initial view on availability and being able to get to future growth? Yeah. That's a question we've gotten a few times. And I would tell you that I think in general, things are okay because if you look at what the administration is targeting, they're targeting the more recent migrants, if you will. But if I go back to before this started, the elevated migration of people that they're trying to reverse now, I mean, we built 120,000 pools, and new home construction was stronger then. So there was plenty of people back four or five years ago to build more pools and build more homes. And my assumption is that those folks are still here and are not the target of any of the administration policies. So by and large, we're not hearing from any of our builders that their labor pool has changed significantly. Very good. Thanks for your thoughts. I'll pass it on. Thanks. Our last question for today will come from Sam Reid with Wells Fargo. Please go ahead. Awesome. Thanks so much. Peter, I really appreciate all the high-level color you gave on your outlook beyond 2025. That said, could we drill down in terms of what needs to happen for you to get back to your algorithm, especially kind of that 6%-9% level on the top line? I guess what I'm getting at is 6%-9% achievable absent lower rates, or if not, let's say we see this rate environment kind of persist in perpetuity here, would 2025 be a good approximation in terms of how the business will trend? Thanks for the question. I would tell you that in order for us to get back to the long-term growth algorithm, 6%-9%, then we need the housing market to loosen up, and we need rates to come down. If rates don't move and people's access to capital form their home equity remains very expensive, I think if you call that the new normal, I guess I'd have to view that in a couple of different stages. If it's normal now and then you have and it stays flat for several years where it becomes not as much of a shock of, "Wow, this is really expensive," and therefore it is the new normal, then I think I would have to fall back on, "Well, how desirable is the product that we sell?" Meaning new pools. Are pools something that are going to go out of favor, or it's a matter of affordability? So if rates stay elevated and wages continue to go up as time goes on, if rates don't move, then eventually we would get back to the growth algorithm because I think maybe naturally the housing market would open up. I believe that rates will come down, and that should stimulate some growth, and as I said, I think there's some pent-up demand on renovation and remodel. And I believe that the product that we are involved in, which is the outdoor living and swimming pools, are still in high demand. And I would expect as rates come down for it to move. But certainly in the short term, it'll be very hard to get back to the 6%-9% growth if new pool construction stays flat at 60,000 units. No, that's helpful, Peter. I appreciate it. And then Melanie, quick one for you. You talked through several new private label categories that you're getting into. I know you're already really strong on the private label chem side. Could you just dig deeper into what you're doing beyond that? What's the mix of COGS those new private label products are going to account for? And then maybe isolate any gross margin benefits in 2025. Thanks. Yeah. So our main focus continues to really be initially for 2025 on the maintenance side of the business. So the various products that we're adding to that portfolio really kind of all cover the maintenance side. And from an overall benefit, we are expecting kind of back to Ryan's question, some offset from some of that positive benefit that we got in 2024 related to the import taxes that won't be recurring. So for the full year, that was about 20 basis points. And then we're also continuing to add to our NPT private label products on the pool finish and tile side, which we'll see some benefit of that in 2025, but really poised for future benefit as the new pools and renovations continue to increase. No, that's really helpful. Thanks so much. This concludes our question and answer session. I would like to turn the conference back over to Mr. Peter Arvan, President and CEO, for any closing remarks. Please go ahead, sir. Yes. Thank you all for joining us. We look forward to our next call, which will be on April 24th when we will release our first quarter 2025 results. Have a great day. Thank you. The conference is now concluded. Thank you for attending today's presentation. You may now disconnect.