To give some context, over the prior nine quarters, our orders grew over 20% a quarter. So, it’s been sizable and sustained that that helped build the backlog. The second dynamic we highlighted was the expectation of customers to return to more normalized ordering patterns. Now that the supply chain is improving and — we started to see that dynamic play out in the fourth quarter. So, overall, we’re comfortable with our order levels in Q4. After starting off in January and we just finished January, we had another sold orders a month, ahead of our expectations, and solidly up from January 2022 order levels. So, again, we’re feeling pretty good with a strong backlog and our orders are hanging in there. So, we think that we’re in — looking at a pretty good year.
Deane Dray: It’s all really helpful. Thank you.
Dave Zapico: Okay, thank you, Deane.
Operator: And our next question today comes from Brett Linzey with Mizuho. Please go ahead.
Brett Linzey: Hey, good morning, all.
Dave Zapico: Good morning, Brett.
Brett Linzey: Hey. And just wanted to come back to the inventories, some of your peers have been talking about some elevated inventory in some of the OEM channels. Just curious what you’re seeing there in some of your serve businesses, serve markets, and if there’s any area of concern there?
Dave Zapico: Yes, the first point I’d like to make is that when you’re looking at customer inventories, a lot of our products are customized, and they’re high-value products. So, we don’t really have a lot of distributor stocking issues to worry about. That’s particularly true in EIG. In EMG, there’s more of an OEM deal with the customer base, and that’s where you’re seeing a bit of the customer ordering patterns normalize. But overall, we think we’ve got a good handle on it, and we feel pretty good about where we’re at.
Brett Linzey: Yes, okay, that’s great. And just shifting to the 2023 outlook, I was hoping maybe you could put a finer point on just the underlying assumptions. How much price do you expect verses volume? And then anything specific on the quarterly phasing, I mean do you think you’ll get growth in both the first-half, second-half, or as you work down the backlog, does it begin to decline there in the second-half?
Dave Zapico: Yes, great question. I mean with our budget model, we pretty much have a traditional first quarter. So, it’s not really second-half-biased. And we think we’ll grow in each of the quarters of the year. And in terms of pricing, in our budget model we have about four points of price. And we assume that we assume that we have about 3.5 points of inflation. So, we are going to offset price and inflation by about 50 basis points. Now, that’s down a bit from 2022 where six points of price. And we offset about 5 points of inflation. But, it’s the guide for the entire year. And we are being a bit conservative now. And, we will probably start out a little better than that. But, that’s our plan for 2023. Also in 2023, I mean in addition to staying in front of inflation with price, we think supply chain shortages are going to abate.
And we believe our working capital levels will decrease to more normalized levels to a very healthy 110% to 115% conversion to net income on the free cash flow. We also think that in terms of vertical markets we do expect our longer cycle aerospace and defense businesses to be a bit stronger than the balance of the portfolio. So, one through the mortgage segment commentary, Deane, it was a little bit higher, was — had a mid- to-high outlook. So, we think that’s going to be true. And that was accelerating as we — each quarter of 2022 really. We expect both of our groups to grow mid single digits. We talked about the historically strong backlog. And, that’s some assumptions that went into our budget. Do you have any questions, Brett?
