Hello everyone, welcome to ADS's Q4 and Fiscal Year 2023 Financial Results Call. Thank you for standing by. My name is Daisy and I'll be coordinating your call today. If you would like to register a question, please press Star followed by one on your telephone keypad. I would now like to turn the call to over to your host, or Mr. Mike Higgins, Vice President of Corporate Strategy and Investor Relations. Sir, you may begin. Thank you. Good morning, everyone. Thank you for being with us here today. I have Scott Barbour, our President and CEO, and Scott Cottrill, our CFO, with me. I would also like to remind you that we will discuss forward-looking statements. Actual results may differ materially from those forward-looking statements because of various factors, including those discussed in our press release and the risk factors identified in our Form 10-K filed with the SEC. We may update forward-looking statements in the future, we disclaim any obligation to do so. You should not place undue reliance on these forward-looking statements, all of which speak only as of today. The press release we issued earlier this morning is posted on the investor relations section of our website. A copy of the release has also been included in an 8-K submitted to the SEC. We will make a replay of this conference call available via webcast on the company website. With that, I'll turn the call over to Scott Barbour. Thank you, Mike. I appreciate everyone joining us on today's call. Fiscal 2023 was ADS's sixth consecutive year of record revenue and profitability. Net sales grew 11% to $3.1 billion. Adjusted EBITDA increased 34% to $904 million, resulting in an adjusted EBITDA margin of 29.4%. In addition, net income per diluted share was $6.08. I'd like to point out that over the last six record-producing years, net sales and adjusted EBITDA have increased at a CAGR of 16% and 29% respectively, as a result of ADS's strong business model and long-term strategies to drive profitable sales growth above the market. Both ADS and Infiltrator executed these strategies well in a dynamic macroeconomic environment over the past 12 months. Full year results came in above our guidance range as we executed well to close out the Q4 and the year, despite overlapping demand weakness in our core non-residential and residential end markets. We had a very strong start to the year with demand, shipping rates and pricing all favorable. Beginning in September, demand in the residential market weakened, shortly followed by weakness in the non-residential market. In response, we made the necessary adjustments to our operations and plan and executed well against them. Long term, we remain confident in the non-residential and residential end markets, but we expect the slower pace to continue through this calendar year due to the higher interest rates, inflation on building material costs, and tightening lending standards, all of which impact the pace of construction and the customer. Despite the short-term weakness in demand, the need for water management solutions remains highly relevant. We are actively engaging with communities that are improving standards for stormwater and on-site septic wastewater management, staying true to our brand promise to protect and manage water, the world's most precious resource, safeguarding our environment and communities. We have a runway for long-term growth in both the stormwater and on-site septic wastewater markets due to the value proposition, solutions package, conversion to plastic from traditional materials, and a unique sustainability position of ADS in water management and recycling. As one of the largest plastic recyclers in North America, we remain committed to finding innovative ways to increase the use of recycled plastics, thereby improving the circularity of the plastics economy and giving us additional scale to manage costs and financial performance. Last October, we broke ground on a world-class engineering and technology center to expand our efforts to innovate with both recycled and virgin plastics, develop new products, and develop technology for manufacturing operations. Importantly, we are being recognized for our impact, effort and value proposition as companies continue to choose our products for water management in large scale development projects. While there is weakness in our core markets, the agriculture, infrastructure and onsite septic markets have a more favorable outlook. The agriculture economy remains healthy and landowners continue to invest in field drainage as a high return investment to improve crop yields. We are pursuing growth in new geographies where agriculture drainage is less widely accepted. The agriculture market team is actively cultivating relationships with universities, farming groups and contractors to better understand technologies and opportunities for growth on a very local scale. Within infrastructure, I'd like to highlight secular growth trends around the Infrastructure Investment and Jobs Act funds that will come into play later this year, as well as onshoring projects and the Texas Department of Transportation's approval for the use of thermoplastic pipe last November. We're actively bidding on projects in each of these areas and tracking opportunities to be specified on project plans. This is a great example of ADS's proven market share model at work. As shown on slides five and six, we had an excellent Q4 from a profitability standpoint. Adjusted EBITDA margin increased to a new Q4 record of 27.8%, 300 basis points above the prior year, despite a 9% decrease in revenue. Favorable pricing and material cost offset inflationary cost pressure, lower relative Infiltrator volume, and lower fixed cost absorption from the production adjustments made over the last two quarters. Non-residential and residential construction activity was resilient in areas like the Southeast Atlantic Coast and Southern United States, where we have focused resources over the last five years as a part of our key state sales strategy. The Northeast, Midwest, and Western United States remain challenged. Notably, revenue in the infrastructure market increased 6% in the Q4 and remained a bright spot throughout the year, with year-over-year increases in each quarter. From a product standpoint, ADS's HP pipe, Nyloplast catch basins, and water quality solutions all grew double-digit year-over-year. In addition, sales from Infiltrator tanks and Delta Treatment Systems also increased this quarter compared to last year. There's no doubt that the demand environment we are facing today is challenging. The strength of the seasonal uptick in order activity was not as strong as we would normally see. We are cautious about the impact from interest rate increases and the effect that local banks tightening credit standards will have on the commercial construction market, which is all reflected in our fiscal 2024 guidance issued today. In the agriculture market, the heavy snowfall in the Great Plains region prevented contractors from installing field drainage, compressing the spring selling season. The underlying fundamentals, however, remain healthy in the market, we expect to see growth in that business in the fall. On our last earnings call, we announced several actions to right-size the business for the current demand environment. We completed three plant closures and reduced headcount in manufacturing and transportation. We also increased the fleet utilization and reduced usage of third-party logistics services, which resulted in better sequential transportation costs in the Q4. The actions we took on plant closures and headcount will largely benefit fiscal 2024. We have taken the appropriate steps to level set production and inventory levels, and we will continue to assess our cost and network to take action if necessary. Scott Cottrill is going to get into the specifics on fiscal 2024 guidance momentarily, but you will see we remain committed to the adjusted EBITDA margin range of 28%-29%. We will continue to invest in capacity for growth regions and new products, productivity, maintenance, and automation in the organic business because of the significant long-term opportunity in the stormwater and onsite septic wastewater markets. A strong balance sheet in combination with a strong cash flow generation profile give us the ability to continue investing in the business, preparing for the upturn that we know will occur in our markets. Finally, Roy Moore, the President of Infiltrator, is retiring at the end of May. Roy's 35-year career at Infiltrator is full of innovation in products, material science, and manufacturing technology. His vision and leadership of Infiltrator is remarkable and provided us with a tremendous foundation to continue building upon. As part of a planned succession, Craig Taylor will be taking over Roy's position. Craig joined the business in February 2020 and has been a significant contributor in his relatively short time with us. On behalf of the whole organization, I want to thank Roy for his contributions and wish him the best in his retirement. With that, I'll turn it over to Scott. Thanks, Scott. As shown on slide seven, we generated $708 million of cash flow from operations in fiscal 2023, converting 78% of our adjusted EBITDA into cash. This is compared to $275 million in the prior year, an increase of $433 million. One of the most important attributes of ADS is our ability to generate significant cash flow, which allows us to fund our capital allocation priorities. Our trailing-twelve-month net debt to adjusted EBITDA ratio of 1.2x, in addition to over $800 million in liquidity, gives us ample room to continue investing in the business at a higher rate than we have historically. Our investment initiatives are focused on growth in regions like Florida and the Southeast and increasing investments in productivity, automation, as well as debottlenecking our recycling operations. We are also investing in a world-class engineering and technology center to increase our focus on material science, as well as accelerate product innovation, as well as our manufacturing processes. In fiscal 2024, we expect capital expenditures to be between $200 million and $225 million as we invest in these initiatives, putting us on our front foot for when our core end markets return to growth. In fiscal 2024, we will remain committed to our capital allocation priorities of, in order, investing organically in the business, acquisitions, share repurchases, and our quarterly dividend to shareholders. Importantly, today we announced a 17% increase in our annual dividend to $0.56 per share from $0.48 per share in fiscal 2023. Moving to slide eight, we present our fiscal 2024 guidance based on order activity, backlog, and current market trends. We expect revenue to be in the range of $2.6 billion-$2.8 billion. In terms of phasing on a year-over-year basis, we expect revenue to be down 15%-20% in the first half of the year and flat to down 10% in the second half of the year. Adjusted EBITDA is expected to be in the range of $725 million-$825 million, resulting in adjusted EBITDA margin of between 27.9%-29.4% or flat to down 150 basis points year-over-year. I'd now like to provide additional details on our expectations for next year. We expect normal seasonality during the year for revenue, with approximately 55% of expected revenue coming in the first half. We expect demand weakness in the non-residential and residential markets to continue with better end market dynamics in the infrastructure, onshoring, agriculture, and active onsite septic businesses. We expect price mix materials to remain favorable year-over-year, driven by favorable material cost expectations. Over the last two fiscal years, price mix materials favorability has primarily been driven by our pricing actions. Manufacturing costs will be under pressure as demand softness will result in lower fixed cost absorption. In addition, we continue to see inflationary cost pressures on labor and utility costs. Lastly, transportation is expected to be favorable due to greater utilization of our fleet versus third-party carriers, as well as favorable trends in diesel and third-party logistic costs. Before turning the call back over to Scott, I'd like to point out that there are two slides in the appendix of today's presentation that I encourage you to look at. Based on market growth, inflation, and the addition of the active onsite septic market, our total addressable market is now an estimated $15 billion. The details of which can be found on the slide. In addition, we provided a slide with details on the timing of commercial construction projects, giving context to when ADS products are involved in the project timeline. With that, I'll turn the call back over to Scott. Thanks, Scott. A couple of key items I wanna highlight before we open it up for questions. First, I know it's at top of mind, April results on a consolidated basis were marginally better than expected against this guidance that we spoke to today. Second, as demonstrated in the guidance we issued today, we remain committed to the 28%-29% adjusted EBITDA target through fiscal 2025. We'll continue to manage our cost of production to meet these commitments, but importantly, we want to be able to service our customers as the upturn comes about, and we'll always keep that in mind. Last, there's still significant opportunity for both ADS and Infiltrator to increase share in our end markets. The proven market share model gives us confidence in these increased capital investments we have planned for fiscal 2024. We will use this period of slower demand to invest in this capacity in important regions, some new products, automation, safety improvements, and maintenance to ensure that when the market ramps up, we have good service and the right capacity to be the partner of choice in our markets. The ADS value proposition, solutions package, conversion strategy, and unique sustainability position in water and recycling remain highly relevant, and we're committed to being the leader in these sustainable water management solutions. With that, let's open it up for questions. Thank you. As a reminder, if anyone would like to register a question, please press star followed by one on your telephone keypad. Please ensure you are unmuted locally. If you would like to withdraw your question, please press star followed by two. That's star followed by one on your telephone keypad to register a question. Our first question today comes from Michael Halloran from Baird. Michael, please go ahead. Your line is open. Hey, good morning, everyone. Hey, Mike. Morning. Congrats to Roy as well. A couple of things here. When you think about the upper end of the guidance range and the lower end of the guidance range, could you just talk loosely to what that environment entails? I'm not looking for something numeric. I'm more thinking about, you know, what type of landscape are we in on the resi, non-res side at the high end and the low end, and how do you think that compares to what a bottom might look like from an end market perspective? Okay. Roy's a pretty happy guy, Mike, I have to admit. We had a nice send-off with him with our board the other evening. Yeah, I get that. We'll miss him. I would say the upper end of the guidance, if I get your question correctly, you know, what set of events would have to occur to get to that upper end? Then what set of events would have to occur to get to that lower end? I think at the upper end- Yep ... we certainly have to see a quicker upturn in the demand environment, which is weak. We're probably in our worst part of the demand environment, you know, right now as our markets weaknesses are overlapping between residential and non-residential. I would say to get to that upper end of the guidance would require, you know, a quicker upturn than the plan and a continued favorable, you know, price and material environment. We're working the price really well right now. The material environment is pretty good. You know, if there was some extraordinary event that took it down, you know, that would be getting us towards the upper end of the guidance, let's say. The lower end of the guidance clearly would be more in particular, non-residential weakness. If you ask me what keeps me up at night, it's the effect of tightening credit standards on local and regional banks, which are the lifeblood of those construction projects that we're out there. You know, that's kind of our meat and potatoes stuff. The infrastructure, the onshoring, that offsets some of it, but not all of that meat and potatoes. The lower end of the guide would be governed by kind of the opposite effects. You know, this worse non-residential market, and then if there was some extraordinary event around materials that took them the wrong way, or the pricing plan. We think we have a very good handle on the pricing plan. You know, thinking about those things we can't control, that would worry me on the lower end of that guidance. No, that makes a lot of sense. When you think about the customer, the interactions and what they're saying, are you sensing that there's just hesitance given some of these the credit tightening standards? Is there pent-up demand anywhere in the market? Maybe- Maybe the better way to ask the question is, also give some context on some of the pockets in the non-res space where you're seeing a little bit more strength, where you're seeing a little bit more weakness, in the market as we sit here. I smile because some of our sales leadership is described as the demand is out there's just no financing for the demand. Particularly in the non-residential, there is hesitancy in some regions to move forward with projects, either because of increased kind of equity requirements around those real estate projects or worry about, you know, vacancy rates in that area. There's others that things are pretty robust. You know, we always talk about the Atlantic Coast, Southeast, Texas, where we are in Central Ohio, very robust. We do go to other places, particularly out West, not so robust, much more hesitancy to pull the trigger. The Northeast, a lot more hesitancy to pull the trigger on new projects, and that's where we see the most weakness. Onshoring's been strong. Onshoring has been strong. We're pursuing a lot of projects in the onshoring. Scott makes a good point. We're actually actively shipping against some that are, you know, battery and electric vehicle related. We're in pursuit of many projects on that. The business development platform that we developed to pursue residential home builders and the warehouses and the data centers has been a perfect vehicle for us to plop this type of activity on. As you all know, there's different engineering firms, sometimes different contractors, different relationships, but we've made that pivot over the last, you know, kind of six, nine months pretty well, I think. Great. Really appreciate the time, everyone. Thank you. Thanks. Great. Thank you. Thank you. Our next question today comes from Matthew Bouley from Barclays. Matthew, please go ahead. Your line is open. Morning, everyone. Thank you for taking the questions. Just a question on kind of the longer term margins. Obviously, you're guiding to a margin in, you know, fiscal 2024 that is, you know, effectively in line with your 2025 Investor Day outlook, as you mentioned. Should we think that, you know, look, if you're able to do that type of margin in a year that's clearly pressured by, you know, volumes and the end markets, I'm not necessarily looking for guidance, but, you know, how do you think about what the kind of structural profitability of this business can look like, assuming we, you know, have a recovery in those end markets? Thank you. Okay, Matthew, that's it's kind of the eternal question of, you know, what's the ultimate profitability level of the company? You know, we're pretty pleased that we got to the long-term or the three-year Investor Day target in the first year, actually went a little bit past it. We have a lot of confidence to be able to stay in that range. As we look at kind of that next plan, you know, there's probably another leg up in that 150, you know, basis point type of range where we could get in that next three-year plan. As you kind of look out, we don't think that we've topped out in market share or in our ability to drive increased profitability in the business. Now, as you know, there's kind of three or four really big factors in that, you know, price, material cost, the mix of Infiltrator and allied products that drive a lot of gross margin improvements in that. We've added to that the ability to, you know. It's not been easy, but in, you know, in the pipe business, trying to get our arms around some of the conversion costs in that through the automation, you know, couple plant closures and things. The four tools remain there, you know, price, mix, materials, all of that stuff. These other ones that we have been adding and will continue to add to the mix will be important tools. I don't think we're done yet, I guess, would be my summary. The only thing I'd add to Scott's point, we talk about the fact we're still really investing in the business. When you look at it on the restructuring side so that our cost structure is more reflective, that adds to when demand comes back to the ability to leverage the enterprise better. The investments we're making in de-bottlenecking our recycling and the engineering technology center in growth in areas like Florida and the Southeast and productivity and automation and refurbing and tooling and maintenance that we need to get caught up. We've been talking about the last two years, we haven't been able. We've been running everything we got. We haven't been able to take care of the equipment as best we want, and now we're investing in that. I think that profitability part Scott mentioned, not only the growth piece, but that profitability piece lends itself really well to a margin story as we go forward. We're not done yet. We're not done yet. Got it. Well said. Thank you for that. I guess second one, I wanted to ask on the residential side. You know, obviously, you're seeing some signs of, you know, particularly in the new resi side, some, you know, early signs of improvement and construction activity. I guess the question is, you know, obviously, you guys have direct exposure there on the land development and septic side. You know, number one, I mean, how is residential contemplated within your full year outlook? Number two, you know, what would the kinda knock on effects be to your non-residential business if you do see this continuing trend? Thank you. We see all those same things that you just mentioned in land development, the onsite septic. I'd say kind of right now, you know, we're waiting for some of those things to develop and impact us. We hear the talk. You know, we see some activity, but it hasn't really manifested itself in orders and demand for us. You know, it's kind of, Matt, I think, you know, not this quarter, if it's going to happen, it's going to happen in the back end. Yeah. You know, our customers in some of these spaces are certainly feel better today than they did in November. Yeah. Matt, Mike Higgins. I would agree with what Scott said. I think we will know more. Yeah as, you know, when we get to September. It's just too early to call right now. Yeah. Much too early to call, kind of call it 6 weeks into our fiscal year. I think as Scott mentioned, April results were marginally better than kind of the plan that we laid out in front of you today. You know, we'll know more as we go through the summer. You know, clearly there's some good positive commentary around residential right now. Again, kind of where we play in the space, it's going to take some time for that to work through, right? That would be beneficial to our non-res business. Yeah That would signal to us, Matt, that, let's say, we get to September, and we feel much more positive about the residential, that would signal to us that the non-res will follow in four to six months. For sure. That would be a nice day at ADS. Got it. All right. Well, thank you, gentlemen, and good luck, guys. All right. Thank you. Thanks, Matt. Thank you. Our next question is from John Lovallo from UBS. John, please go ahead. Your line is open. Hey, guys. Good morning. Thank you for the questions. This is actually Spencer Kaufman on for John. you know, first one, I think you guys mentioned seeing a pullback in material costs as well as transportation. you know, how sustainable do you think your current pricing is if those costs continue to come down? And what would need to happen for WMS to have some price give backs? Go ahead. Yeah. I mean, Spencer, the way we always talk to it is the fact that, yeah, we hold on to most of our pricing, that we've got even when resin comes off, and we're seeing resin come off as you all are as well. It's because of the value prop. It's 'cause of the inflationary cost pressures we're still seeing in labor and utility costs and others. Again, you look at the pricing we've got over the last couple years, we'll hold on to the majority of that. Okay. Got it. You know, just on the CapEx, I mean, you guys talked about some of the projects that you're investing in this year. Maybe just, you know, longer term, how should we think about CapEx, you know, sort of exiting the year? Is it fair to assume some type of normalization here? The reason I'm asking is because if we just look at your, you know, the CapEx guide and your Investor Day outlook versus what is probably gonna happen, I would imagine you guys are probably gonna be a little bit higher than that. Just curious how you guys are thinking about that moving forward. Yeah. I would say taking kinda, you know, $167 million to CapEx this prior year, the $200-$225 range that we're talking about here in fiscal 2024, I would say we're gonna have at least another year or two of accelerated spend at these levels based on our current trajectory. There's just so many opportunities to invest in the business in North America water right now and in our own, you know, business. It's the highest return, lowest risk use of our capital. Right now, based on the cash flow generation, that conversion ratio that we mentioned earlier of our cash flow from operations to adjusted EBITDA, and our leverage, again, we ended last year, fiscal 2023, at 1.2 times. Our guardrails or target leverage is one and a half times, and we wanna put that balance sheet to use. We will, and then if our forecasts come to be and we have excess cash to hit that kind of leverage target, then we'll return that cash to our shareholders through the share repurchase program that we've got and continue to optimize our capital allocation, capital deployment that way. We're very much committed to it. We very much know that being flexible and optimizing capital allocation and deployment priorities is a significant strategic lever that we have, and we'll fully plan on taking advantage of it here over the next couple years. Got it. Appreciate the color, Scott. Thanks. Good luck, guys. Thank you. Thank you. Our next question is from Joe Ahlersmeyer from Deutsche Bank. Joe, please go ahead. Your line is open. Hey, good morning, everyone, and nice finish to the year. Thank you. Thanks, Joe. Yeah. Hey, so you talked qualitatively now about the deflation. Would you mind maybe just dimensionalizing that a bit more? What's baked into your range today from what I would, I guess, call a gross materials number relative to a gross price mix number? Does that really only at this point in the year represent the favorability you see either on the balance sheet at this point or in your POs for further resin purchases in the near term? I'm just trying to understand if we kinda see spot prices hang out where they are today, is there additional favorability to the range that you provided for EBITDA? Yeah. The way I would talk to it, Joe, is, you know, the EBITDA bridge and waterfall chart we present in our management presentations quarterly and at the end of the year, you know, does a good job of showing that price cost bar. If you look over the last couple years, you know, that bar has been green, and we commit to that bar to be green as we move forward and as we've generated or performed historically. The last couple years, you know, it's been no secret. It's been largely, if not entirely driven by our pricing actions. When you look at going forward into our 2024 guide, it's very much gonna be a story of material cost deflation, to your point. We talked about holding on to the majority of the price increases we've gotten over the last two years, and that is our commitment. That being said, we'll be very smart about that locally like we always are. We have competition like everybody does, we'll be smart about that and look at that. We also have end market, which is a little, you know, which we don't have the conversion story, you know, in agriculture that we gotta be sensitive to competition there. That's a little bit more of a commodity-based business. Those are things that are re-represented and reflected in our guide. Obviously, if things change during the year, then we'll pivot and adjust. Right now, as we've talked in the past, 70% plus of our quoting and pricing is project-based. If we see things happen either on the resin side, in our labor cost side, utility or energy cost side, any of those types of things that go in a way differently than what we expect, we've got the ability to pivot and make that happen. Our sales guys do a great job of keeping that in front of them and making sure that we adjust accordingly. Okay. Great. Thanks for that color. I hate to be the April guy, but if I could just dig in on the comment about it coming in better than sort of what you had outlooked for the first half down 15%-20%. Maybe just contextualize that comment a little more, whether it was driven, I guess, more by non-res or res at this point. Maybe to that point on the 15%-20%, does that sort of look the same res versus non-res, or is non-res down more than 15%-20% relative to res? So- Go ahead, Joe. I would say that the outperformance was led by residential more than non-residential. The kind of sales revenue in total kinda came out about where we thought it would in line with this guidance. There was slightly better mix and slightly better price and material performance and transportation than we anticipated as we were putting together the plan for the month. Yeah. Let's just, I mean, the word we'd like to use, hey, you know, we had a decent month, right? It's not, it's not a data point to extract for the whole year. Had a good month. We knew people would wanna know. We're slightly ahead of plan. You know, May's looking okay. It's a plan. We're executing against that plan. What I'd like to kinda say is, you know, it's early in the year. This uncertainty around non-residential and the lending standards is real. It affects how people go and start construction projects. As you all know, and it's in the chart, you know, we're at that front end of the construction process in the ADS business. If that stuff gets waivers a little bit, I mean, that impacts us, and we just do not want to. Overestimate what that, what that could be to us, and that's what we put in this guidance. Had a good start. You like to have a good start to the year and the quarter, and that's what we did, and we'll keep working it. Understood. We obviously appreciate the additional detail. Good luck in the quarter, guys. Thank you. Thanks, Jeff. Thank you. As a reminder, if anyone would like to register a question, please press star followed by one on your telephone keypad. Our next question comes from Jeff Stevenson from Loop Capital. Jeff, please go ahead. Your line is open. Hey, thanks for taking my questions today. Infrastructure growth looks like it accelerated during the quarter, and wondered how much of that are share gains versus overall market growth. Are you seeing any meaningful flow through yet in IIJA funding, or is that more of a back half of the calendar year story? Scott Barbour here, Jeff. I would say for us in infrastructure, you know, the year we had where each quarter showed some improvement, or each quarter showed some growth and improvement is probably, you know, minimal share gain. You know, I think the real share gain will be coming in the future as we get specified on projects in Texas, as we get specified on projects in the East Coast or the Southeast and in Florida where we know are share gains, but probably minimal share gains last year in that performance. It was more just money beginning to flow from that IIJA. That said, you know, I wouldn't call the IIJA funds flow to date. What has that been, two years now since that was approved, probably? Roughly. I wouldn't say all of it has been flowing in our kind of direction yet. A lot of that money, as our guys are out in the field, it's been on repair and replace, asphalts, bridges, services, designs. The capacity adds of roads and highways, which is really where we play, is, I think, yet to come in those spending packages. Yeah, Jeff, Mike Higgins. I, again, just to kind of reiterate what Scott said. You know, we'll go back. I think, you know, the growth really has been over the past year. Traditional ... yeah, in kind of our traditional states where we have more, much more mature approvals and activity was pretty good there. You know, the Texas thing is starting to ramp. You know, we're seeing pretty good success there, but, you know, real early, not material amounts of sales. You know, what the feedback we get from our guys in the fields and our team who's very close to the infrastructure market is just what Scott said. Probably about 50% or so of the funds that have been kind of out there have really gone to repair and reconstruction work, which can be mobilized on pretty quickly. That's repaving of roads, maintenance, et cetera, like that. The stuff where we will play new construction capacity expansion for transportation is really still on the come. You know, kind of best knowledge now is that stuff you'll start to see kind of release and flow into the back half of the year again. Back half and over the next year. Yeah. I mean, This is a multiyear program. I don't think you're gonna see, at least for us, you won't see one big spike in volume or activity. We'll look back on this four or five years from now and, you know, we'll see, hey, you know, our share and our volume of what we're selling is, you know, some decent amount better than where we are today. Okay. Very helpful color. Then, my second question is just on how you view inventories right now and is-. Hey, can I just add one thing to that? Sure. Could you repeat your question? I'm sorry. I'll add my thing in after you repeat your question. I apologize. Okay. Yeah, no worries. Yeah, just on, kinda how you view inventories right now, and is destocking, over? Yeah, destocking is over, no doubt about that. We, you know, it's primarily occurred at Infiltrator. It exclusively occurred really at Infiltrator. We've worked through that. We talk a lot about that with Roy and Craig and the team, and we feel very confident that's kinda done. Their pace of order intake and ship, you know, is right back to where it was pre-pandemic. It's a pretty quick turnaround business. What I was gonna add, and I apologize for, like, tacking something onto Mike's thing, is I think the most important thing that about the kind of that multi-year program on infrastructure is that we've made the investment organizationally in sales talent, in pursuit to make that happen. You know, we're not waiting for all those, you know, the exact right time and a bid package comes out. Starting two years ago, you know, or plus two years ago, when we did some reorganization stuff and knew that public was a big place where we could gain share, before the IIJA was even approved, we knew that was a share gain thing, and we started making those investments in sales talent and business development talent, and those guys are doing a very nice job. We know ton more about those states and those markets than we did two and a half years ago. We're really proud of what Bob Klein and that team are doing, and John Sickels. That helped drive the Texas approval, all those efforts. You know, we have the capability and scale to go make those investments two and a half years ago. That does take some time to go and pay off. We understand that about our business. When we talk about the resiliency of our business, that is one of the things that I always mean is we have that size and scale to make long-term investments in organization and people because it's a long cycle business, and we're able to go and do that. I think that's really different about us versus many of our competitors that I see in this business. I just took a little time there. That's the important part of this whole thing, I think. Great. Thank you. Thank you. Our next question is from Bryan Blair from Oppenheimer. Bryan, please go ahead. Your line is open. Thank you. Good morning, everyone. Good morning. Morning. Morning. To further frame your set of going into fiscal 2024, I apologize I missed this detail. How does your backlog and order run rate look relative to pre-pandemic lows? Okay. Let's take backlogs first. This is Scott Barbour. Bryan, welcome. You know, backlog and backlog behavior, and let's just take Infiltrator as an example, is more reflective of pre-pandemic, where we would have what? You know, $7 million-$8 million, three, you know, two or three days worth of backlog in Infiltrator, and it's a very fast cycle business. You know, you get an order, it ships out within a day, one to three days. The ADS behavior is a little different. It's more of a 30 to 60 day maturing of that backlog, and it is now kind of down to levels that were pre-pandemic. Think of them as 2019 type of levels. Which again tells us that we've got any restocking, overstocking, you know, flushed out of the channel, kind of tells us back to we've absorbed all the hits on that. It looks at the ADS side and says, Wow, you know, there were a bubble in some areas. We're kind of through that. We're back to these kind of pre-pandemic levels in many areas, somewhat below them in some areas, in some regions of the country. As you know, it's a very regional business, and you have to look at it in that way. Book-to-bill staying above one. Yeah, the book-to-bill is above one. You know, it's just, you know, the demand is. Yeah ... over those kind of bubble periods, I believe. You know, I think at the peak on the ADS business, you know, we were tracking kind of 75-90 days of sales and backlog, which is extremely high. Now we're closer to tracking kind of roughly one month of sales or a little bit above that in the backlog. That, as Scott mentioned, that shows us that, hey, you know, there was, you know, a lot of demand that came at us. There was difficulty in meeting the, you know, supply chain, being able to deliver that on time because, you know, you're outstripping your capacity. That's kind of worked through, and we're now at a level where, you know, we're much more accustomed to. I'd say that's been the case since January. Yeah. You know, I think November... Clearly October, November, December, there was adjustments going on, in our markets, and we were making adjustments also. That really started in September in residential hard, and then it began in non-res really November, December. Since those adjustments, January, February, March, April have been very customary types of behavior and shipment behavior. Yeah. I think the other part of your question as far as order trends, you know, I would go back to the order kind of activity that we're seeing matches up well with the guidance that. Yeah ... that we've issued today. Yeah. Understood. All very helpful detail. Following up on infrastructure and your team's multi-year runway there, are there any other metrics you can offer to help us think of the scale of that opportunity overall? Anything in the bidding pipeline or project funnel would be very helpful. Yeah, we haven't really detailed kind of the incremental impact to that. I mean, what I would caution, you know, people on is, you know, you're talking very large numbers. There's a lot of kind of, lot of projects and types of work in that. You know, we're really gonna play in kind of the roads and highways and streets, you got to kind of look at what is that? You know, our product is typically on a standard, you know, highway construction or street construction. You know, let's just call it rough order of magnitude somewhere, you know, kind of 1%-3% of the project value. That'll give you an idea of kind of the, you know, what's the real opportunity, you know, for us, right? Again, very helpful. Thanks again. Thank you. Thank you. This is all the questions we have today, so I'd like to hand back to the management team for any closing remarks. All right. We really appreciate the participation in today's call and the questions, very good questions, and we're glad to answer them. We look forward to talking to several of you later today and over the next couple of days. Have a good day and a good weekend. Thank you. Thank you everyone for joining today's call. You may now disconnect your lines and have a lovely day.