Myles Walton: So maybe I’m going to go around the horn a little bit. But I’ll just start in Aerospace, in the fourth quarter, the RSP versus MRO mix or growth rates; however, you want to provide it, what did that look like? It sounded, Julie, like the RSPs maybe took a step back. Is that correct?
Julie Streich: Yes. They were down relatively speaking a few million dollars between quarter with relatively flat OEM and MRO, so it was a temporary dip in RSP.
Myles Walton: Okay. So when I look at the margin profile sequentially, that sounds like it’s more of the determining factor than an incremental labor inefficiency or instability that’s occurred. Is that a fair characterization?
Julie Streich: They definitely both contributed, yes.
Myles Walton: Okay. And then on the margin outlook for 2023, obviously, versus the run rate you did in the fourth quarter, you’re looking for a couple of hundred basis points of expansion. So again, what is the underlying assumption on RSP in that high single-digit outlook you have for aftermarket?
Julie Streich: So as you think about 2023 and the margin blend, we saw a very nice ramp this year because the aftermarket sales were growing at an accelerated pace. And just as a reminder, RSP sales were up 59% and MRO was up 33% with OEM up 7%. As we get into 2023, we’re going to see the OEM side ramp like we said low double digits, but we’re going to see MRO and RSPs slow a bit. Therefore, there will be a bit of mix impact on overall margin, and that’s what’s built into our outlook. Did that answer your question?
Myles Walton: A little bit. But your €“ I guess, what you’re saying is there’s a mix impact, but I’m looking at the run rate from you did in the fourth quarter and what you’re looking for, for next year. And obviously, you’re assuming a 16.5 in the fourth quarter going to 18.5 in the 2023 time period?
Julie Streich: Yes.
Myles Walton: But the mix is against you, so OEM must be getting materially better in terms of performance.
Julie Streich: Absolutely. We would anticipate that OEM performance is going to improve. Q4 was a dip.
Myles Walton: Okay. All right. And then on the Industrial consolidation side, you’ve got now two SBUs of pretty material size, and you’ve got automation at 20%, 30% of the size of the other SBUs. Is that teeing it up for bolt-ons or any reason why you don’t view that as sort of subscale relative to the other two? And then that one has unique European exposure for 2023. Is that more of a risk to your outlook?
Thomas Hook: Myles, a very insightful question. I mean, I think there is scale differences. As you know, we’re looking at a lot of opportunities for how we Integrate, Consolidate and Rationalize the entire portfolio. So you’re right to point out there’s other opportunities for how we could manage the SBUs. We’re only communicating, obviously, the natural fit between Engineered Components and FMC into kind of a Motion Control business today. We actually feel pretty well positioned with our automation portfolio. One of the items that we referred to last quarter was bringing that automation portfolio to the Americas in a more purposeful way. So we’ve made investment with feet on the street in addition to our distributor EMI that’s in the Americas to be able to jointly sell and perfuse the market.
