Sarah Alexander - General Counsel Bruce Thames - President and Chief Executive Officer Jay Peterson - Chief Financial Officer.

Brian Drab - William Blair Charley Brady - SunTrust Robinson Scott Graham - BMO Capital Markets Jon Braatz - Kansas City Capital Josh Pokrzywinski - Wolfe Research.

Good day, ladies and gentlemen and thank you for standing by. Welcome to the Thermon Manufacturing Company’s Earnings Conference Call. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session and instructions will be given at that time.

[Operator Instructions] I would now like to introduce your host for today’s presentation, Ms. Sarah Alexander. Ma’am, please begin..

Thank you, Howard. Good morning and thank you all for joining us for today’s earnings conference call. We issued an earnings press release this morning which has been filed with the SEC on Form 8-K and is also available on the Investor Relations section of our website at www.thermon.com.

A replay of today’s call will also be available via webcast after the conclusion of this call. This broadcast is the property of Thermon. Any redistribution, retransmission or rebroadcast in any form without the expressed written consent of the company is prohibited. During this call, our comments may include forward-looking statements.

These forward-looking statements are subject to risks and uncertainties and our actual results may differ materially from the views expressed today. Some of these risks have been set forth in the press release and in our annual report on Form 10-K filed in May.

We also would like to advise you that all forward-looking statements made on today’s call are intended to fall within the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995.

These statements may include, among others, our outlook for future performance, revenue growth, profitability, leverage ratios, acquisitions, acquisition synergies and various other aspects of our business. During the call, we will also discuss some items that do not conform to Generally Accepted Accounting Principles.

We have reconciled those items to the most comparable GAAP measures in the tables at the end of the earnings press release. These non-GAAP measures should be considered in addition to and not as a substitute for measures of financial performance reported in accordance with GAAP.

And now, it’s my pleasure to turn the call over to Bruce Thames, our President and Chief Executive Officer..

Thank you, Sarah. Good morning, everyone and thank you for joining our conference call and for your continued interest in Thermon. Today, we have Jay Peterson, our CFO, joining me on the conference call. Jay will follow me and present the financial details of our fiscal 2018 second quarter. To begin with an overview of the financials.

Overall, we are pleased with the improved operating performance in Q2. Revenues were down 10% year-over-year with lower Greenfield activity in the U.S. and slower backlog conversion in the Eastern Hemisphere.

In the short-term, Hurricane Harvey negatively impacted revenues by approximately $2 million in the U.S., but we do anticipate an increase in business levels over the next two quarters as we assist our customers in safely restoring operations. Otherwise, we saw growth in orders, backlog, margins and EBITDA during the quarters.

Margins improved by 820 basis points on a modestly improved mix of Greenfield to MRO/UE at 34% and 66% respectively versus 36% and 64% in the prior year. The larger drivers were improved project management and field execution on Greenfield projects and stronger overall MRO/UE margins, particularly in North America.

In addition, we saw continued improvement in our margins and backlog during Q2 of approximately 100 basis points. Backlog margin levels have increased 4% from the lowest point, but remain 2% to 3% below historical averages in advance of the oil and gas downturn.

While the geographic backlog shift from North America to the Eastern Hemisphere and highly competitive Greenfield pricing have created margin headwinds, we are seeing the overall margin pressure moderating as maintenance spending begins to recover.

With book-to-bill at 118%, second quarter bookings of $72.6 million improved by 32% consecutively and 23% year-over-year, a record backlog of $121 million was up 41% year-over-year and 10% consecutively. The increase was largely attributable to petrochemical and power project bookings in the U.S. and Latin America.

Both GAAP and adjusted EPS finished at $0.15 a share versus a prior year of $0.11 a share and $0.10 per share respectively. From a market perspective, the oil and gas sector is showing some early signs of recovery with increased maintenance spending and some capital spending on smaller projects.

The chemical and petrochemical sectors remain active although the majority of new projects are coming from the Eastern Hemisphere. Visibility is also improving on upcoming projects in the U.S. for fiscal 2019 as the second wave of petrochemical projects are getting underway. Combined cycle power projects remains steady, particularly in the U.S.

Geographically, revenue was down in EMEA and the U.S. whereas Asia-Pacific was flat and Canada showed growth of 18% over prior year. Backlog conversion remains slow in the Eastern Hemisphere, but shipments began to materialize in Q2 and will increase in the second half.

After a very robust Q1 in Canada, we are very pleased to see the trend continued into Q2 and anticipate the order strength to be sustained throughout the second half of the year. Weakness in the U.S. and the Latin America Greenfield projects continued as we anticipated into Q2.

Overall, we were very pleased with the incoming order rate and backlog growth in the geography. Looking ahead, we see the Greenfield activity increasing in the second half of this year.

Although revenues are anticipated to be down from prior year, we have the ability to achieve our EBITDA targets on stronger margins and the favorable impact of cost reductions implemented earlier in the quarter. Moving on to our project pipeline.

The number of opportunities in total value within our pipeline remains relatively stable at over 800 identified projects and approximately $900 million in revenues respectively. We continue to invest in new product development to position the business for future success.

Today, we are launching CompuTrace WebExpress, a new heat tracing design software intended for smaller projects with 20 circuits or less. The application is easy-to-use on any mobile device, leverages the power of our full design suite database and we believe will become the standard in the industry for maintenance and smaller projects.

The application ultimately generates a Thermon bill of material and is intended to drive the MRO/UE business. We will have more new product announcements later in the fiscal year. The CCI Thermal acquisition is progressing as planned and we anticipate closing within the next several weeks.

We expect this acquisition to add from $38 million to $41 million in inorganic revenues for the year at an estimated 24% to 26% EBITDA margin in fiscal 2018. And please note this is excluding any one-time purchase-related expenses. We will provide more detailed information on the acquisition during our Q3 earnings call.

While our M&A pipeline remains robust, our capital allocation in the near-term will shift to debt reduction. Looking forward, the strong backlogs and improvements in Canada provide the line of sight to achieve our organic revenue plans for the year.

Based upon the status of projects in engineering, we anticipate the backlog to translate into higher revenues in the second half relative to prior year. As a result, we are confirming our guidance of low to mid single-digit organic revenue decline for fiscal 2018.

Any exposure to the lower end of the range due to project timing should be more than offset by margins being exposed upward relative to prior year and the favorable impact of prior cost actions.

We are pleased with the improved operating performance and remain cautiously optimistic on the positive signs of a recovery we are seeing in many of our end-markets. These two factors combined with the pending CCI Thermal acquisition positioned the company well for future success. Thank you again for joining us today.

Jay Peterson, our CFO will now address the details of our financial performance for Q2 2019.

Jay?.

Thank you, Bruce. Good morning. I would like to start by discussing our Q2 financial results and then conclude with updated revenue guidance for the balance of this fiscal year. First off, all of our financial results ended in the mid to high-end of the range relative to our pre-release of selected financials earlier this month.

Let’s start off with top line, in terms of orders and revenue, our orders for the quarter grew 23% year-on-year and 32% sequentially and we experienced order growth in both hemispheres. Our MRO/UE mix for Q2 was 66% of revenues, whereas Greenfield totaled 34%.

Greenfield revenues declined by 15% over the prior year quarter due to continued delays in capital spending, whereas MRO/UE decreased by 8%. And FX currency translation positively impacted our revenue by approximately $1.5 million. We ended the quarter with a record backlog of $123 million and that’s up 41% year-on-year.

In addition, margins in our backlog are up 400 basis points also year-on-year. And as mentioned several times, over the last year, we continue to experience a protraction in the turns in our backlog. For example, 18 to 24 months ago, our backlog would typically turn within approximately 12 months.

At present, due to a continued depression in capital spending, our turns have increased to 15 to 18 months. And our book-to-bill for the quarter was positive at 118% contributed to the protraction in the turns in our backlog and this marks our fourth consecutive quarter of positive book-to-bill performance.

Moving on to gross margins, margins improved by 820 basis points this past quarter due to strong MRO/UE mix and to continued favorable Greenfield pricing and continued cost controls. For the quarter, Greenfield margins increased by 600 basis points over the prior period, whereas MRO/UE margins increased by 900 basis points.

Turning to operating expense and headcount, core OpEx for the quarter, that is SG&A and this excludes depreciation and amortization of intangibles totaled $18.7 million in the quarter versus $18.7 million in the prior year quarter. And this includes approximately $300,000 of transaction expenses related to the upcoming CCI acquisition.

Our OpEx as a percent of revenue was 30%, again excluding depreciation and amortization. The number of full-time employees at the end of September was 956 versus 945 as of calendar September 2016.

In terms of earnings, our GAAP EPS for the quarter totaled $0.15 a share compared to a prior year of $0.11 a share and that’s an increase of 35% and free cash flow EPS totaled $0.13 per share down from the prior year due primarily to an increase in inventory levels.

Our EBITDA grew by 26% in the quarter and totaled $13.5 million and EBITDA as a percent of revenue improved to 21.9% much closer to our historical levels and what we anticipate to deliver in the future. And note that our EBITDA was positively impacted by the companies we acquired in fiscal year 2016.

Next, our balance sheet, our cash balance ended at $88.4 million this past quarter. And over the prior 12 months, we decreased our debt balance by $17 million concurrent with growing our cash and investment balance by $12 million.

Post acquisition, our net debt to EBITDA leverage will be at 3.4x and we will have approximately $40 million in worldwide cash on our balance sheet. Our annual debt service will actually decrease from current debt levels by 20% or more from approximately $23 million down to approximately $16 million.

And this excludes debt issuance costs concurrent with increasing our pro forma EBITDA by 50%. Strong cash flows from the combined businesses will create the financial capability to comfortably operate the business and the associated debt levels, while currently de-levering our business.

We anticipate our net debt to EBITDA leverage to approach 2.5x within the next 24 months and this is quite similar to how we de-levered our business post IPO. And lastly, guidance for the balance of this year. We are maintaining our organic guidance to a low to mid single-digit decline for fiscal year ‘18.

Although our Q2 revenue levels were lower than we anticipated, we believe our strong order growth and increasing backlog will enable us to achieve this guidance. In addition, we anticipate to generate $38 million to $41 million in revenue with CCI between the close of the transaction and the end of our fiscal year.

I would now like to turn the call over to Howard to moderate our Q&A session.

Howard?.

[Operator Instructions] Our first question or comment comes from the line of Brian Drab from William Blair. Your line is open..

Hi, good morning. Thanks for taking my questions..

Good morning, Brian..

First one, just on the topic of the interest expense, can you just maybe clarify, you are giving the 20% – approximately 20% reduction guidance in interest expense, I guess debt service costs.

Can you talk about just a little more specifically about the reduction in interest expenses as it relates to the amount that would flow through to your adjusted EPS?.

Yes. So, there is amortization component. Excluding the amortization component, the interest rate will increase from approximately 3.3% to 5.25% and 5.5% plus or minus. However, in the latter, it’s only a significantly larger component and we will provide more guidance on that once we close our term loan B..

Okay.

But the total debt balance is going from – I can look up these numbers – I have these numbers in my notes I guess, but just can you say on the call here going from what to what probably for the total debt balance?.

So, our debt balance today is $77 million. And so that’s it, 3.3%, so whatever that math tells you. And going forward, our debt will be on the term loan B $250 million at somewhere again it’s open to how we closed this out in the next couple of weeks 5.25% to 5.5%..

Okay, got it. Thank you.

And the difference between that those figures that we just went through there and the reduction of 20% has pretty much everything to do with a large amortization of debt discount component that doesn’t flow through the income statement?.

Exactly. The amortization on the term loan B will be 1% a year for the next 7 years and then there is a balloon. With the term loan A, we started out with amortization of 10% and in April of this year that grew to 15%..

Got it, okay. Just shifting gears to the orders and revenue outlook, if we remove CCI or just keep CCI out of the numbers just for a moment, the order growth is great, the backlog you mentioned is at a record level, but the guidance I think still implies a modest decline I think in the back half of the year.

I know there is an FX?.

No. See, I guess when we were – when we revised guidance in the first quarter, what we said is that we are down $10 million first quarter. We said the balance of the year we would expect to have similar revenues year-over-year.

And obviously, this quarter we were down about 10%, but we hold to that guidance that we expect revenues to be relatively flat. And we have given a range, but for this last three quarters. So, we would expect to makeup any revenue shortfall we saw in Q2 in the coming quarters. That’s our range of guidance.

So, looking at $264 million in revenue, we are saying we will be – for fiscal 2018 will be down low to mid-single digits in revenue year-over-year.

And then I kind of add to that, if we are exposed to the lower end of that range, we feel like the improved – the improvements we have made in cost as well as what we are seeing in margins and backlog would expose margins for this second half up by a point or so from prior year.

So, we believe that we will more than offset any if we did fall in the lower end of the revenue range based upon project timing..

Okay, thanks.

And then bookings that you have this quarter and the backlog that you have now, Jay, you mentioned the extended sales cycle or at least a time to collect on those bookings and complete these projects or is the activity that’s happening now really primarily going to impact fiscal ‘19 or can you talk about that when you are going to start to see some of the real impact from the activity in petrochem and PowerGen that’s taking place?.

We booked some nice projects in the U.S. this last quarter that will begin to materialize, some of them as early as Q3, their some midsized projects. And so we would expect to start to see some of them in Q3 and Q4, some will carry over into the next fiscal year, but we will see some in the second half of this year.

What we are really seeing is the cycle times on projects in the Eastern Hemisphere are more protracted than some of our historical projects in the Western Hemisphere and that combined with kind of the current environment with the lower capital spending. We have seen those projects move more slowly..

Okay.

And then I will just ask one more, you mentioned that the hurricane activity could actually provide a tailwind in the back half of this fiscal year which makes great sense to me given it seems that a lot of the petrochem and refining facilities were affected by flooding, which could – the teams could generate a really large opportunity in MRO and UE that type of activity in the back half of the year.

Is this potentially a very material opportunity in the back half of year or would you describe or is it modest tailwind?.

It’s more of a modest tailwind. We didn’t see the level of impact that we saw with Katrina or some other large storms. There were a number of facilities that had significant flooding.

There were some others that were much less impacted and were up and operational fairly quickly, but we are working with customers that had more significant impact and we would expect to see some positive impact in the second half of the year..

Okay. Thanks very much..

Thank you..

Thanks, Brian..

Thank you. Our next question or comment comes from the line of Charley Brady from SunTrust Robinson. Your line is open..

Hi, thanks. Good morning, guys..

Good morning..

Just in terms of – can you talk about pricing maybe to the degree to which you are getting pricing now and can you maybe put that in terms of what’s that doing in terms of material cost increase. Are you offsetting that or is that – or you are getting positive price on top of that.

It sounds like you are getting positive price on top of any Ross increases?.

Yes. We are seeing improved margins and I will focus more on the Greenfield for a moment. We have done a lot operationally to better position our cost structure and we have done a lot to execute more tightly both on project management and field execution and we are seeing that come through in our Greenfield margins.

Also, the reality is the book of business we have today is a better book of business than we had a year ago. And I think all of those things are contributing factors.

I don’t want to misrepresent the reality it’s still very competitive on price and so that continues, but we are seeing better margins just based on our execution as well as what we see in backlog.

From an MRO/UE perspective, we made some adjustments in manufacturing and we also had a stronger mix of some of our electrical products, which tend to be higher margins and the combination of those two factors have really been positive.

And I think we can’t discount the fact that the return of Canada which has been largely pent-up maintenance spending has had a very favorable impact to the margin profile of the business..

Great. In terms of your commentary on the duration being stretched from what it’s been historically.

In terms of the quarterly cadence if you look out to the rest of the year, anything unusual as far as third quarter, fourth quarter mix or kind of normal what we have been seeing for the past couple of years?.

We do expect the mix to shift – would be heavier than what we saw in the first half of the year or towards Greenfield and a lot of it will be we are going to see shift to some shipments in the Eastern Hemisphere and we do expect that to weigh on margins. So, they won’t be as healthy as what we saw in this quarter based upon that.

So, again, as we look ahead, we believe margins based upon the mix of business we see in the second half would be exposed upward by about a point over what we saw in the second half of fiscal 2017..

Great. Thank you..

Thank you..

Thank you. Our next question or comment comes from the line of Scott Graham from BMO Capital Markets. Your line is open..

Hi, good morning..

Good morning, Scott..

So, that last piece of information was very helpful on what I assume you talk about of course on the gross margins being up 100 basis points or more for this next two quarters.

I kind of want to ask this little bit of maybe a longer term horizon here if your gross margins in your backlog are up 400 basis points I am assuming that, that’s versus what we ended up within fiscal 2017?.

That’s a year ago. That’s correct..

Right..

That was at the side at the bottom..

Agreed.

So what we are saying here is that on a go forward basis, the gross margin should be at least 46%, not all quarters, that fourth quarter is usually a little lower, but that’s kind of should be at least 46% going forward?.

Yes. We are seeing that in that range and we say at least, I would say 45% to 46% is what we believe going forward. And Scott, you know this very well it will depend on the mix of Greenfield in any given quarter. So, if we get some large projects, shipments and it skews more towards Greenfield that could be worked it way that down.

And conversely, if we have a heavier mix of MRO, there could be upside to that number..

Of course.

On the cost savings, could you tell us what is remaining to run through the P&L this year and next dollars?.

We only saw about 2 months in this quarter and we do have a number of other things that impacted cost, which Jay could probably provide a little more detail on, but we don’t have any further cost actions in mind.

And so our cost structure as it is here is what we would anticipate going forward, but Jay, you want to just touch on a couple of the things within the quarter..

Yes. There were cost reductions that occurred in the prior quarter, Scott. The impact was muted in this last quarter due to three things. One is we had FX increasing our costs as reported by $270,000.

We had Logan transaction – I am sorry the CCI acquisition transaction expenses that hit the P&L in Q2 of $330,000 and then there was a smaller amount, $100,000 for some charitable contributions due to the Harvey hurricane and those three amounted to about $700,000 that impacted the P&L in Q2..

SG&A..

SG&A, yes..

Right, okay. And I do understand that there are offsets, but I guess what I am saying is that when you had that difficult quarter, 3 months ago and it might have been before that, forgive me if I don’t remember that exactly, but there were cost actions initiated to impact our fiscal ‘18 results by about $2.5 million.

And what I am saying is that, that wasn’t a first quarter benefit that was supposed to be sort of a 12-month benefit from the second quarter to the second quarter of next year. That’s kind of what I am asking about. So, off of my math there is still that to roll through..

Well, see those would have started to roll through in Q2 both in SG&A and cost.

If you look at our cost of goods sold in Q2 relative to the prior year Q2 and I realized buyout items and mix have an impact on this, but cost in Q2 was down 23% versus a year ago and then we had the 700,000 that I just mentioned that the majority of that will not flow through to next quarter. I am not certain what FX will do in the current quarter..

Understood. Okay, understand. So, third question is on SG&A, so when we ex out D&A from SG&A, we are still kind of running at a much higher level than we were heading into the downturn. I think that the number is something like 300 to 400 – 300 basis points.

Is that a situation where you are just waiting for the revenues to catch up or is there something we can do about that?.

Right now, Scott, it’s with the backlog we have, we have a significant amount of work in engineering and so that’s just a lag you see in revenues..

Okay, understood.

And I guess my last question would be, Bruce, you made a comment about 22% EBITDA margins being sustainable, I am assuming that you are talking about that on a sort of an annual basis obviously because the fourth quarter margins for the company are always lower as am I characterizing what you said correctly?.

Actually, I don’t think I have said that, but yes, I do think that going forward, we are seeing some, I think Jay may have said that what we are seeing now is more what we expect to see from the business and we would expect that going forward. And that would be to your point on an annualized basis.

We might see better than that in the next quarter and then lower, but on an annualized basis in that range absolutely. We should – this business should operate north of 20 and approach 25 when everything is going well..

Got it. Thank you..

And this would exclude the impact of the CCI acquisition, this is organically..

Yes, understood. Thank you..

Thank you, Scott..

Thank you. Our next or comment comes from the line of Jon Braatz from Kansas City Capital. Your line is open..

Good morning, Bruce, Jay..

Good morning..

Bruce, you mentioned that business over in the Eastern Hemisphere has been more protracted, why is that?.

Just project cycle there, just I think historically they just take longer to execute than they do in North America particularly..

Okay.

If oil prices continue to rise, would you see any reason for that change?.

Yes, I mean, you can – when oil prices go up, you can actually – you can see projects being accelerated to the extent as petrochemical may not have a favorable impact, but if you look at a lot of these projects that are really related to Russia, the Caspian and the Middle East and those are all more national oil companies, state owned entities and so their drivers tend to be different and much longer term.

And so the behaviors of those customers might differ from what we would see elsewhere in the industry..

Okay, okay. Secondly, over the past week I spoke with some of the CCI reps and CCI Thermal reps and by the way they all say great things about CCI.

I think you made a – it looks like you made a wonderful acquisition, but they talk about a couple of their products roughneck and Katahdin, I think I have that correct being the gold standard of the industry.

And if I am not – am I correct roughneck is pretty much an oil and gas product line, but what is Katahdin, what industries does that serve?.

Katahdin is a catalytic gas-fired catalytic heater for hazardous environments. It’s used a lot in natural gas and it’s used particularly in the remote areas, where electrical heating is not available for compressor stations, metering stations of different things like that, so midstream as well as upstream applications..

Okay.

And roughneck is on drilling operations?.

No, it will – it can be, but it is actually an electrical hazardous area environmental heater that can be used in a wide range of applications..

Okay..

And it is for hazardous environments, so you tend to see it used in and from upstream to midstream to downstream applications..

Okay, okay. Alright. Thank you very much..

Thank you..

Thank you. Our next question or comment comes from the line of Josh Pokrzywinski from Wolfe Research. Your line is open..

Hi, good morning. Close stuff on that one..

Good morning, Josh..

I am used to it. I don’t know if I get it anymore.

Just back to the gross margins, I guess with the 50% being so strong, could you dimension out how much of that is really just MRO versus maybe some better backlog pricing that converted on the Greenfield side?.

Yes. So, I mean MRO margins were up 900 basis points in the quarter. And a lot of that was the shift we saw in the mix to North America and we had a heavier shift of electrical. So, those things impacted it plus some of the changes are noted in manufacturing. So, those were all contributing factors.

And so those will also influence what we would expect going forward and depending on mix and geographic mix as well as product mix will impact those numbers on a quarter-to-quarter basis. But we do believe what we are seeing there based upon the mix particularly with the changes in manufacturing we believe that is sustainable..

Got it. And I think – I mean, that was a pretty binary shift in margin performance. I mean, you have signaled that the go forward gross margins are going to be kind of in this 46%ish range. I guess that presumes something more normalized on the mix front.

But on MRO North America is what you are booking today as strong as it is I guess consistent or do we see some sort of I guess deferral activity start to get catch up, because it is a pretty violent swing versus 3 months ago?.

Yes. Well, our margins were up last quarter so..

I mean, I guess the sequential move in profitability was pretty good?.

So, yes, absolutely. And so good the fact that we are seeing Canada recover in a meaningful way has had a big impact and again the gist of the North American business beginning to see some improved incoming order rates and around our MRO business has really been very positive.

But if you look at our backlog, our backlog is still heavily weighted to the Eastern Hemisphere. And so as we see some of these Greenfield projects come through, they will offset some of that increase that you saw in this current quarter. So, the geographic mix as well as the mix of Greenfield will weigh down what you saw this quarter.

So, I do not – we don’t expect 50% margins going forward..

Understood.

On Canada though specifically, I mean, I know there has been some volatility there related to fires and whatnot, is any of the kind of cleanup posts recovery there at work in some of this margin delta and is any of that kind of more of a catch up on that front versus back to business as usual in Canada?.

Our temporary power business did have some positive impact from that particularly in that first quarter, some of that has carried over into Q2, so that had a positive impact, but some of this is more broad-based. We have seen it in gas activity. We saw in the first quarter and some of that has continued.

We also see that as we have, I mean, over the last 10 years we put in $150 million to $200 million of electrical heat tracing in the Canadian market and that’s now beginning to come up for maintenance. And so we are seeing some of that spending flow through.

And so all of those are very positive, we saw some pent-up demand around some maintenance and small upgrades and expansion in small capital projects now that’s finally being released and so all of those have been contributing factors..

Got it. Appreciate the color..

Thank you..

Thank you..

Thank you. Our next question or comment comes from the line of Charley Brady from SunTrust Robinson. Your line is open..

Hey, just a quick follow-up, can you quantify what U.S.

and EMEA were down in the quarter?.

Yes. The U.S. for the quarter in aggregate was down 28%, 29% and EMEA was down 6%..

Thanks..

Thank you, Charley..

Thank you. [Operator Instructions] I am showing no additional audio questions at this time, sir..

Alright. Well, thank you all for joining. Thank you for your interest in Thermon. I look forward to talking to you next quarter. Thank you..

Ladies and gentlemen, thank you for participating in today’s conference. This concludes the program. You may now disconnect. Everyone have a wonderful day..