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Operator
At this time, all participants are in a listen-only mode. After the speaker's remarks, there will be a question and answer session. If you'd like to ask a question during this time, simply press star then one on your telephone keypad. And if you'd like to withdraw your question, please press star one again. As a reminder, please limit yourself to one question with one follow-up. I'll now turn the call over to Zach Nagel, Vice President of Investor Relations.
Zach Nagel
Thanks, Operator. Good morning, and thank you for joining us for Training Technologies' fourth quarter 2021 earnings conference call. This call is being webcast on our website at trainingtechnologies.com, where you'll find the accompanying presentation. We are also recording and archiving this call on our website. Please go to slide two. Statements made in today's call that are not historical facts are considered forward-thinking statements and are made pursuant to the safe harbor provisions of federal securities law. Please see our SEC filings for a description of some of the factors that may cause our action results to differ materially from anticipated results. This presentation also includes non-GAAP measures, which are explained in the financial tables attached to our news release. Joining me on today's call are Dave Regneri, Chair and CEO, and Chris Kuhn, Executive Vice President and CFO. With that, I'll turn the call over to Dave. Dave?
Dave Regneri
Thanks, Zach, and everyone for joining us on today's call. Let's turn to slide number three. Today, I'd like to open with a few comments on our purpose-driven sustainability strategy. which is the engine that enables us to deliver differentiated shareholder returns over time. Secular sustainability megatrends continue to intensify. Climate change is causing more extreme weather events, which threaten vulnerable people and economies around the world. Scientists say it is still possible to meet the targets set under the Paris Agreement, but it is getting more difficult as time passes. We need to act today. And that's what Train Technologies is doing. We have set aggressive science-based emission reduction targets that continue to push our innovation further and faster. That innovation is transforming the way the world heats and cools buildings, improves indoor air quality and safely transports food and medicine. As we scale today's technology, and innovate for tomorrow, we can dramatically reduce emissions and accelerate the world's progress. We are committed to making a difference, relentlessly and over the long term. This unyielding approach enables us to consistently outgrow our end markets, which in turn helps us drive strong margin and powerful free cash flow to deploy through our balanced capital allocation strategy. The end result is strong value creation across the board for our customers, for our team, for our shareholders, and for the planet. Moving to slide number four. Our global team delivered a strong close to 2021. Despite persistent macro challenges related to cost inflation, tight supply chains and logistic markets, and labor availability that continue to restrict capacity and negatively impact productivity. In the fourth quarter, we delivered 27% bookings growth, 11% organic revenue growth, and 32% adjusted EPS growth. This includes approximately $80 million of $150 million of revenue that was pushed out of the third quarter, which was at the high end of our guidance range of $50 to $75 million. On balance, 2021 was another very strong year for us, with record performance across key financial metrics. Bookings, revenue, backlog, EBITDA margins, and adjusted EPS all hit record levels. price realization also reached record levels, demonstrating the power of our business operating system and enabling us to more than neutralize the impact of widespread and persistent inflation for the year. With record demand for our innovative products and services and backlog nearly double the level it was at this time last year, we are extremely well positioned for 2022 and beyond. We anticipate macro challenges to continue to constrain capacity and to negatively impact productivity, and those impacts are reflected in our revenue and EPS guidance. They are also reflected in how we're thinking about the cadence of the year, with the second half expected to be much stronger than the first half. With continued strong demand and supply constrained by the macro environment, we expect backlog to remain at elevated levels throughout 2022 and into 2023. Please turn to slide number five. Looking at our initial guidance for 2021, we effectively met or exceeded all of our targets and delivered another year of strong financial performance. We delivered 11% organic revenue growth. 140 basis points of adjusted operating margin expansion, and 37% adjusted EPS growth. We also delivered strong free cash flow and returned $1.7 billion in capital to shareholders through dividends and share repurchases. Please turn to slide number six. Our relentless investments in innovation and our unwavering focus on serving our customers enables us to deliver consistently strong performance and differentiated returns for our shareholders over the long term. Demand for sustainable solutions continues to accelerate, and our innovation leadership is positioning us to outperform end markets. This will only intensify as the world decarbonizes. We're confident our leadership in sustainable innovation will continue to deliver differentiated financial performance and shareholder returns into the future. Please turn to slide number seven. In addition to our financial metrics, our ESG performance is core to our purpose and our strategy. Beginning in 2021, we revised our annual incentive compensation plan for approximately 2,300 leaders to link directly to ESG metrics, including reducing carbon emissions and increasing the diversity of our workforce. These metrics are on our glide path to achieving our 2030 sustainability commitments. And I am happy to report that we exceeded each milestone in 2021. job well done by the team. Please turn to slide number eight. Customer demand for our climate-focused innovation continues to grow. We delivered another quarter of robust organic bookings growth, with growth across all segments. Customer demand was high throughout 2021, with organic bookings up 27%. for both the quarter and the year, driving record backlog in each segment entering 2022. Organic revenues were also strong, up 11% for the quarter and the year. Overall, Booking's growth far exceeded revenue growth, which was in part constrained by global supply chain and other macro challenges referenced earlier. Our Americas commercial HVAC business delivered robust bookings growth in the quarter, with orders up mid-20s. Strength was broad-based, with applied, unitary, and service each up more than 20%. Demand for comprehensive end-to-end indoor air quality solutions remained strong and contributed to high single-digit organic revenue growth in commercial HVAC Americas. The residential HVAC markets also remained strong, and our residential HVAC team delivered bookings growth over 30%. Revenues were up mid to high teens in the quarter, adding to growth of more than 20% in the fourth quarter of 2020. Sell-through across our channels was also strong, up high teens. With full-year organic bookings up over 70% and full-year organic revenues up over 30%, our America's transport refrigeration business significantly outperformed the North America transport markets. During the fourth quarter, we extended our 2022 order book through the third quarter of 2022, which contributed to bookings growth of more than 40%. We continue to thoughtfully manage our 2022 order book in order to mitigate inflationary risks. Fourth quarter organic revenue growth was consistent with full year growth, up 30%. Turning to EMEA, we continue to see strong demand for our innovative products and services that help reduce energy intensity and greenhouse gas emissions for our customers. Our EMEA teams delivered 13% organic bookings growth in the quarter, with strong growth in both commercial HVAC and transport refrigeration. With full-year organic bookings up over 40% and full-year organic revenues up over 20%, our EMEA transport refrigeration business significantly outperformed the markets in 2021. During the quarter, EMEA transport refrigeration bookings and revenues were both up high teens. Our Asia-Pacific team delivered strong bookings growth of 18% and revenue growth of 4%, supported by broad-based growth in China and across the region. Now I'd like to turn the call over to Chris. Chris? Thanks, Dave. Please turn to slide number nine. Organic revenue growth in the quarter was driven by both strong volume and continued strong price execution of over 5% incremental price. Turning to margins, price over material inflation was modestly positive in the quarter, capping full-year positive price cost. Productivity was significantly impacted by continued supply chain, logistics, and labor availability challenges, which were exacerbated in recent weeks with the rapid spread of the Omicron variant. In addition, we continue to make strong incremental business reinvestments. Adjusted EBITDA and operating margins improved 30 and 10 basis points, respectively. Adjusted EPS grew 32%, driven primarily from a higher adjusted operating income. Please turn to slide number 10. We discussed the key revenue and margin dynamics for the enterprise on the prior page. The dynamics impacting revenue and margins were similar across each of our business segments, as we've highlighted here. with strong price realization, incremental business reinvestments and innovation, and macro challenges impacting productivity and cost inflation as consistent drivers. Both the Americas and EMEA segments delivered higher revenues with modest margin declines. Margins were impacted by the macro challenges we've outlined. For the full year, both Americas and EMEA segments delivered strong margin expansion, with EBITDA margins expanding 100 basis points and 240 basis points, respectively. Our Asia Pacific segment delivered good leverage and margin expansion in the quarter, with EBITDA margins expanding 170 basis points for the full year. Now, I'd like to turn the call back over to Dave. Dave? Thanks, Chris. Please turn to slide number 11. Commercial HVAC Americas has significantly outperformed the broader markets over a number of years through relentless innovation for our customers. Our unwavering focus on solving our customers' most complex problems, compounded by the strength in underlying market conditions, powered the business forward in 2021 and yielded record backlog entering 2022. And markets continue to improve with a multitude of economic indicators pointing to growth in 2022. GDP forecasts remain strong, unemployment is low, and indicators like Architectural Billing Index, which has been over 50 since February, remain largely favorable. Demand remains strong in data center, warehouse, education, and healthcare. We're benefiting from increased demand across our K-12 customers, with federal stimulus funds supporting both current and future growth. we see this as a multi-year tailwind for our business given our strong position in the education market and our direct sales force with deep relationships in this vertical demand for our residential products was unprecedented in 2021 contributing to record revenue looking at 2022 we see tailwinds from record backlog entering the year and expect strong price realization and we see headwinds from lapping tough growth compares from 2021. I'm proud of our residential team that has continued to meet customer demand while ramping capacity after a February weather event in our Texas facility. The team remains on track for capacity expansion in advance of the 2022 cooling season. Turning to America's transport, we significantly outgrew strong end markets in 2021, as we outlined earlier. ACT continues to project continued market growth through their forecast horizon of 2023. I'll talk more about the transport outlook in our Topics of Interest section. Turning to EMEA, while we have muted expectations for market growth, demand for our sustainability-focused systems and services remains strong, and we continue to see good opportunities for market outgrowth. Our transport refrigeration business significantly outgrew end markets, delivering over 20% full-year revenue growth as compared to 13% market growth in the region. Turning to Asia, we expect growth in China in 2022, supported by strength in data center, electronics, pharmaceutical, and healthcare. Outside of China, the picture is mixed with COVID-related partial lockdowns still impacting market expansion in some countries. Our direct Salesforce model is differentiated in the region and provides good opportunities for market outgrowth in equipment and services. Now, I'd like to turn the call back over to Chris to outline our guidance for 2022. Chris? Thanks, Dave. Please turn to slide number 12. Based on the market backdrop Dave just outlined and our strong backlog entry in the year, we expect to deliver strong financial performance in 2022 with high single-digit organic revenue growth and adjusted EPS between $6.95 and $7.15. Our operating leverage outlook of approximately 20% contemplates a stronger second half with improving macro dynamics, particularly around inflation and an improving supply chain. We expect price cost to be slightly positive for the year, but negative through the first half as we lap strong price and more modest inflation from the first half of 2021. The macro environment remains dynamic, and we expect tight supply chains, logistics, and labor availability to restrain revenue growth and margins, especially in the first half of the year. We expect free cash flow to remain strong at equal to or greater than 100% of adjusted net income. Our outlook includes capital expenditures of approximately 2% of revenues, which is at the high end of our typical 1% to 2% range. Relentless incremental business reinvestment is never episodic for us, and it's how we innovate ahead of the competition year after year. Entering 2022, we are planning incremental investments in high ROI projects in support of our profitable growth objectives and our 2030 sustainability commitments. These high ROI projects include manufacturing automation, supply chain resiliency, as well as investments to further decarbonize our operations. Our free cash flow outlook also includes modest investment in working capital, with particular focus on strategic inventory to support continued growth. Given inherent challenges in accurately forecasting FX rates and the fact that we're transparent about our organic bookings and revenue each quarter, our guidance excludes potential FX impacts. Our FX exposure is largely translational in nature, and each point of revenue would translate at approximately OI rates. Net, as a reference, each point of negative FX would translate into about $0.05 of EPS headwind. Please turn to slide number 13. While we traditionally provide annual guidance, given a dynamic macroeconomic environment, we believe it may be constructive to provide an outlook for the first quarter based on what we expect to see today. Based on backlog, orders, and the dynamic macro backdrop we've outlined, we currently expect organic revenues to grow in the low to mid single-digit range with flattest unit volumes and strong price realization. First quarter margins are expected to be challenged due to negative incremental price-cost dynamics, considering very strong price versus cost in the first quarter of 2021. You'll recall we were able to get well ahead of inflation in the first quarter with strong price realization, which was part of the reason we were able to deliver very high operating leverage of nearly 50% in Q1 of 2021. inflation was relatively modest in the first quarter of 2021 and really began to ramp aggressively in the third and fourth quarters we exited q4 with peak price and peak cost for 2021 with price at unprecedented levels of more than five percent net while we expect to carry over strong pricing from the fourth quarter of 2021 into the first quarter of 2022 we're also lapping strong price from q1 of 2021 which dampens the incremental carryover price. Likewise, we expect a carryover peak inflation from the fourth quarter of 2021 into the first quarter of 2022, but to lap more modest inflation from the first quarter of 2021. The equation is a bit more complex than this, but to keep it simple, this essentially means that we'll see almost the full impact of the carryover inflation. The end result is we expect to be upside down on price costs in the first quarter by $30 million to $40 million. This pricing dynamic improves as we move through 2022, and additional pricing actions taken in 2022 come online and are realized. As we've outlined, macro challenges related to supply chain, tight logistics, and labor constraints exacerbated by the Omicron variant are expected to negatively impact productivity. While it's difficult to predict the negative impact on productivity in a very dynamic environment, we expect a considerable impact in the first quarter. All in, our outlook is for adjusted operating income to be down approximately $35 million year-over-year in Q1 as we work to balance all the pieces. As we discussed on the prior slide, our full-year outlook contemplates a stronger second half with easing inflation and an improving macro environment. We'll update this outlook as the year goes along. There are a couple of items for Q1 that I also wanted to highlight to help with your models. First, interest expense is expected to be approximately $56 million, reflecting 2021 debt retirements. The other item I'd highlight is the estimated Q1 adjusted effective tax rate of approximately 17%, which we've assumed is flat with 2021. The Q1 tax rate is traditionally low, impacted by higher stock-based compensation in the quarter. The full year 2021 guidance remains 19 to 20%. Please go to slide number 14. We remain on track to deliver $300 million of run rate savings from business transformation by 2023. Importantly, we continue to invest these cost savings in high ROI projects to further fuel innovation and other investments across the portfolio, as discussed earlier. Please go to slide number 15. We remain committed to our balanced capital allocation strategy. focused on consistently deploying excess cash to opportunities with the highest returns for shareholders. First, we continue to strengthen our core business through relentless business reinvestment. Second, we're committed to maintaining a strong balance sheet that provides us with continued optionality as our markets evolve. Third, we expect to consistently deploy 100% of excess cash over time. Our balanced approach includes strategic M&A that further improves long-term shareholder returns and share repurchases as the stock trades below are calculated intrinsic value. Please turn to slide 16, and I'll provide an update on our capital deployment in 2021 and our outlook for 2022. During 2021, we deployed $2.4 billion in cash, with approximately $1.4 billion to M&A and share repurchases. We paid $561 million in dividends and $425 million to pay down debt. Looking to 2022, we expect to deploy approximately $2.5 billion in cash, inclusive of $350 million in share repurchases we executed in January of 2022. Our look also includes our announcement that we intend to raise the quarterly dividend to $2.68 per share annualized. When combined with the dividend increase of 11% in 2021, the annual dividend is expected to be up 26% since launching as a pure play climate control business in March 2020. Our strong free cash flow, liquidity, and balance sheet continue to give us excellent capital allocation optionality and dry powder moving forward. Now, I'd like to turn the call back over to Dave. Dave? Thanks, Chris. Please go to slide number 18. I'd like to spend a couple minutes providing an update on the transport refrigeration markets. Both Americas and EMEA had robust market growth in 2021, and our Thermal King businesses thrived. We pushed through macro challenges and significantly outgrew the markets in both regions. On the left side of the slide, you can see that the North America trailer, truck, and APU markets combined grew 19%, while Thermal King Americas grew more than 30%. In EMEA, market growth for trailer and truck combined was 17%, while Thermal King EMEA also grew more than 30%. On the right side of the slide in the highlighted box, you can see that the total weighted average market growth for the Americas and EMEA transport refrigeration markets in 2021 was 15% and 13%, respectively. Thermal kink growth for the Americas and EMEA was more than 30% and more than 20%, respectively. We're extremely pleased with the tremendous market outgrowth each of these businesses delivered in 2021. Market projections for 2023 call for continued growth in both regions, with particular strength continuing in North America. There's one other important dynamic I'd like to highlight while we're discussing transport refrigeration and moving into 2022. Our teams delivered tremendous booking growth in both regions in 2021, as we discussed on slide eight. Our bookings growth was more than twice our revenue growth, even as our revenue growth far exceeded the growth of our end markets, resulting in record backlogs. Nat, we expect this dynamic to result in bookings declines during the year as we work through backlog extending well into 2022 and go up against tough compares every quarter. We'll highlight these dynamics with our earnings calls for transparency as we move through 2022. Please go to slide number 19. We added a second transport refrigeration slide to the deck last quarter to add more color around the North America trailer market from both backward and forward looking perspectives. We're not going to spend a lot of time on it today, but we think it's a helpful reference slide for additional transparency. ACT continues to call for a nine-year average for North America trailers in the mid-40,000 unit range through 2023, with the pandemic in 2020 being the only significant outlier. Please go to slide number 20. Energy efficiency, decarbonization, and sustainability megatrends are only growing stronger. We are uniquely positioned to deliver leading innovation that addresses these trends and accelerates the world's progress, supported by our business transformation and our engaging, uplifting culture. Despite a number of persistent macro challenges, 2021 was a record year for us with top quartile EPS growth, accompanied by strong free cash flow and balanced capital deployment. We're seeing unprecedented levels of demand for our products and services, and our backlog has never been stronger. We're executing our business operating system well and expect to continue to successfully navigate macro challenges with a customer-first mindset. We believe we have the fundamental ingredients to deliver strong performance across the board in 2022 and beyond and to continue to drive differentiated shareholder returns over the long term. And now, we'd be happy to take your questions. Operator?
Operator
Thank you. As a reminder, if you have a question, please press star then 1 on your telephone keypad. And please limit yourself to one question with one follow-up question. Our first question is from Andy Kaplowitz with Citigroup. Your line is open. Hey, good morning, guys.
Andy Kaplowitz
Hey, Andy, how are you doing? Good morning. Good, how are you? David, Chris, can you give us more color into how you're thinking about trains' abilities offset other inflation outside and material costs with productivity? Because that seemed to be a pretty big swings actor in terms of margin headwind in Q4, and it obviously is pressuring Q1 and 22. So how much was the impact on Q4? What's the impact in Q1? I assume you're taking in the additional headwinds on labor from Omicron over the last few weeks into Q1, and how are you thinking about that for 22?
Dave Regneri
Yeah, I'll start, Andy. So I think going into the fourth quarter, we continue to see challenges on the supply chain front in terms of driving spot buys, inefficiencies in our plant and factory operations. And with our Q4 guide of leverage around mid-teens, we really kind of landed right around that guide. I think leverage in the quarter was around 14%. So we landed right where we thought we would land. In the fourth quarter, we saw a little bit more price on the realization side. We saw a little bit more inflation as well in the fourth quarter. Those both continue to ramp. But we did see negative productivity over other inflation in the fourth quarter, and we're anticipating that for the first half of 2022 as well. The supply chain constraints are real. We're managing through them day by day, week by week. And right now what we see right now is the second half of the year looks to be stronger in terms of supply chain resiliency and ultimately getting some of the supply chain back on track. But it's a balance we're working each and every day. Yeah, Andy, the other thing I would add is that, you know, in our plants right now with the supply chain constraints, and I could talk more about that after, It's very, very disruptive. So if you were a plant manager, if you've ever had the opportunity to be a plant manager, anyone on the line, you know what I was talking about. We're constantly having to reschedule, rebalance lines. We're pulling line side inventory and replacing it with other line side inventory, rescheduling employees. So this is a plant manager's kind of nightmare and The good thing is we have great plant managers, and we're working through it, but it is disruptive. It's been disruptive for some time now, and as Chris said, we anticipate this disruption to continue certainly through the first quarter and the first half.
Andy Kaplowitz
That's helpful, guys. And then, Dave, I think you mentioned before that you expect your Resi-HVAC business to be a GDP-plus business going forward. and in 22 i think with resi booking still up 30 percent in q4 capacity up strong pricing i know you talked about tough comps how are you thinking about the business in 22 does it have the potential to grow in line with the company or and how are you doing inventory in the channel at this point yeah a great question we do see our resi business over time being a gdp plus business and i just remind everyone that you know our resi business is about 20 percent of our total business
Dave Regneri
And we had a very strong fourth quarter. Revenue in the fourth quarter for our resi business was up 17%, 17%. And our bookings were up over 30%. So the resi business is performing well. I'm really proud of what that team has been able to do, ramping up the facility in Tyler, Texas, after a freak weather event. Just the customer mindset there and the ability for them to ramp up and serve the customers, some of the best I've seen in our company. As far as the resi markets go, we'll see growth in new construction, which is a smaller portion of our business. And we don't expect the replacement market, which is the larger part of our business, to fall off a cliff. So our resi business will be up against tough comps, as you said, all year. With that said, we have a strong backlog, market-leading brands, and we'll see strong price all year.
Andy Kaplowitz
Thanks for that, guys.
Operator
Thanks, Andy. The next question is from Julian Mitchell with Barclays. Your line is open.
Andy
Hi, good morning. Hey, Julian. How are you? Good, thank you. Very good. Maybe just wanted to circle back on the sort of EPS seasonality through the year. You know, you gave very clear Q1 guidance. And I suppose the Q1 works out to being around a low team's share of the full year earnings, so not too different versus history. But you kept emphasizing a sort of challenging first half. So when we think about the first half, should we assume it's around the sort of mid-40s share of full year earnings? Is that roughly the right ballpark with sort of price costs getting a little bit less bad in Q2?
Dave Regneri
Hey, Julian. It's Chris. I'll start. Yeah, first quarter where we're dialing in the guide around $0.95 to $1. That would put it around 14% to the full year. So Q1 would be around 14% versus the full year at the midpoint. That's actually a little better than what our average has been over the last four to five years. That average is around 12%. So we're seeing it to be a little bit stronger on the full year. But I think it's hard to tell what we think the second quarter will fully be at this point. We continue to work the supply chain challenges and As we see it, this is not a demand concern. The demand is absolutely there. This is really a supply chain, and how do we navigate through it? So we'll provide some more guidance when we get through our first quarter call and when we think for Q2. But we definitely see from the supply chain aspects, the second half of the year, it easing in terms of supply, logistics, and some of the labor constraints as well.
Andy
That's helpful. Thank you. And then just my second one around commercial HVAC revenue trends in 2022. Should we think about the Americas having kind of the strongest growth of the three regions in commercial HVAC this year? And maybe any color on how you see the new construction market in non-resi in the U.S. this year?
Dave Regneri
Yeah, I'll tell you how you're doing this, Dave. Look, our commercial business performed very well in the Americas all year in 2021 with broad-based strength in Q4 across unitary applied and service. All of them were up over 20%. So the team is seeing tremendous demand. As far as the end markets go, you know, you have low unemployment. You have strong underlying GDP growth. You know, ABI has been positive for the last 11 months, which, you know, are above 50, which means positive. And, again, that's a six- to nine-month lag on that metric. So that's a good foreshadowing as to what to expect in the future. We have particularly strong strength in the data centers vertical, warehousing, healthcare, education. We're starting to see nice growth in the office vertical, indoor air quality, and decarbonization of the built environment will continue to be tailwinds for us. So we'll have a strong year in our commercial HVAC business, and, you know, we have some. Nice tailwinds behind us, and that business will continue to execute. Our constraint there will not be the markets. It will be back to the supply chain, and, you know, specifically in the first half as we're starting to get some visibility into the second half, some of those supply constraints, specifically around electronic components, will start to ease. Great. Thank you. Thanks. Thanks.
Operator
Our next question is from Josh Pokowinski with Morgan Stanley. Your line is open.
Dave Regneri
Hey, good morning, guys. Hey, Josh. How are you doing?
Josh
Well, thanks. I'm just wondering what got worse on the inflation front sequentially 4Q to 1Q. I know, like, some of the metals are sort of rolling off. There's probably an inventory dynamic that gets in the way in realizing that near term. But putting aside, you know, kind of the year-over-year tyranny of the math, like,
Dave Regneri
it sounds like things actually got maybe a little bit worse like anything you'd call out specifically that we should be kind of watching more closely and josh is chris uh yeah in the fourth quarter i would say price was a little better than where we started the quarter and also inflation wound up being a little higher as well part of this is the inefficiencies we're seeing around you know spot buys and expedited freight to ultimately you know serve customers But as I've been carrying over Q4 into Q1, we're seeing roughly the same levels of inflation in the fourth quarter carrying over into the first quarter. You may recall we look at commodities and have a hedging practice and strategy in place for copper and aluminum. which will roll out really over 12 months, but it really smooths the impact of inflation. Going into any one quarter, we'd have about 70%, 75% of that price already hedged. So I would say the impacts of the fourth quarter really start to be very similar to the impacts in the first quarter there. Steel, roughly the same way. We have about a six-month lag on our steel purchasing from when we lock in prices to when we would see any price changes. So any dynamics now in January we're seeing in steel would really be realized in the second half of the year. So that's how we're kind of playing out from Q4 to Q1.
Josh
Got it. That's helpful. And then just on the commercial side, you know, we've had some of these kind of broader market initiatives in your own, whether it's indoor air quality or some of the more sustainability-focused products. You know, really been out there in the marketplace for a while now and customers taking hold. What are you guys watching today to kind of track that in earnest and maybe disaggregate, you know, normal replacement type demand and commercial from some of the spicier stuff you guys have put out over the past, you know, couple years?
Dave Regneri
Yeah, good question, Josh. I mean, first of all, I'll start with IAQ, right, IAQ, indoor air quality. We continue to see a tailwind from that. We had a very good year in In 2021, we expect to have another good year in 2022, still getting a lot of demand out there for indoor air quality audits, as well as what we call day two activity, which is helping our customers build out the infrastructure for long-term improvements with an energy consumption in line of sight there. As far as decarbonization of the built environment, as we call it, We're in the very, very early innings. And the intensity there is growing every day. You know, we've talked a lot about what we're doing in Europe there with the electrification of heating. And that is, again, just to remind everyone, it's really not just a heat pump. It's a system that's combining a chiller and a boiler plant together into one system. That is – we're not only seeing great traction in Europe there. We're also seeing that in the Americas. So those are in the early innings. And, you know, we track activity for both indoor air quality as well as on decarbonization pretty closely. It's getting harder to blend the two together. So those are going to continue. You know, and then you have the core business that, you know, kind of is going to follow what we would say the more traditional, right? We obviously look at what's happening with new construction and Dodge is still, you know, actively forecasting pretty robust demand in 2022. So that's a good sign. And And I said earlier, you know, architectural building index is probably one of the, has probably some of the highest correlation of what the future is going to be for our commercial HVAC business. And that's been over 50 now for 11 months. So that bodes well for the future as well.
Josh
Great. Thanks, guys.
Operator
Sure. The next question is from Jeff Sprague with Vertical Research. Your line is open.
Dave Regneri
Hey, thanks. Good morning, everyone. Hey, Jeff, did you survive the storm up in Connecticut? I did. All good up here. Putting the four-wheelers to work. Unfortunately, we had to use some four-wheelers here in Charlotte, too. Yeah, I'm sure it's a little scary on the roads down there. We know how to drive up here, though. Hey, Dave, I think kind of implicit in you acknowledging the orders will roll down now on the comps and the like would also then obviously suggest that people have ordered further out to get their place in line and that sort of thing. And really the nature of my question is to what extent were people able to place orders in advance of your price increases or
Jeff
you know, have you been able to fully protect yourself on, you know, kind of the cost coming through the inventory channel and the backlog?
Dave Regneri
Yeah, it's a good question for sure. And first of all, let me start with the order rates, okay? So for many of our products, you know, we do have extended lead times right now, so we do have customers that are ordering early by definition. I would also tell you that We're working very closely with our customers, and they want to give us as much visibility as possible. So they're certainly – they understand what's happening with supply chain, so they're asking us to make sure that we get spots secured for them in the future. So, obviously, we are getting orders in earlier. You see that in our robust bookings numbers. I wouldn't get overly concerned with that. It's not like we're pulling in orders from, you know, a year and a half out okay we're talking a few months here as far as pricing is concerned in the backlog um you know at the end of the day if you really have to go through it by business and you know in our com in our resi business for example we reprice the backlog so if we have a price increase we'll reprice the backlog in our commercial business You know, some of our orders actually have price elasticity built into those based on certain indices. So depending on when it's going to ship, it will be at a higher price vis-a-vis if it's shipped today. And that's normal, and we've been doing that for a long time. So, you know, the days of there's going to be a price increase, let me – double order or order as much as I can to get in front of it. I think we've, I mean, it certainly happens a little bit. A lot of that behavior has been changed. And could you provide a little bit more color on, you know, how you think Resi plays out, right? You said you don't envision it falling off a cliff. But, you know, how do you see it playing? And, you know, is there, you know, maybe some gamesmanship around,
Josh
You know, the efficiency change, you just said people don't pre-buy anymore, so perhaps you're not expecting that. But just kind of the overall trajectory of RESI as you see it over the course of the year here.
Dave Regneri
Yeah, I do, you know, as far as the pre-buy for the regulation change and efficiency change in 2023, there could be some of that activity. We don't see it to be anything alarming. It would obviously update everyone as we see that starting to unfold as the year goes forward. As far as the end markets go in resi, 2021 was a very robust year. Fourth quarter was very strong for us, so very encouraged with order rates up over 30% in the fourth quarter. Residential new construction, as I said earlier, it will be positive, right? I mean, there's a lot of Metrics out around that, so that'll probably be, you know, in the low single digits positive, although that's a small percentage of our business, about 20%. The replacement market, you know, about 80% of our business, we don't see it falling off a cliff, okay? You know, could unit volume be down a point or two? Sure. But I also would tell you that we're going to see strong price all year in resi. Okay, great. Thank you.
Operator
Sure. The next question is from Scott Davis with Milius Research. Your line is open.
Jeff
Good morning, guys. Hey, Scott. How are you? I'm great. Thank you. I'm kind of curious just following up on Jeff's question. In new construction, it was always the builders would buy kind of the cheapest unit out there. Is there a change in some buying patterns? Are guys buying higher efficiency and trying to sell the – environmental benefits and stuff like that? Are they able to capture any value on the home building side if they upgrade? Or is it still kind of similar as the past?
Dave Regneri
Yeah, it's a great question. Again, it's a smaller part of our business, only about 20%. And we certainly talk to many of the home builders, many of the large home builders. And what you just described, they're very interested in. um we'll see uh if they act on that but they're very interested conceptually on being able to you know have a a greener home for lack of better terms and being able to sell that to the uh you know to their customer um i i because we're so small i'd be hard to where we're selling we sell some high sear into that market but it'd be interesting to see if some of the larger players actually act on on what they what they talk a lot about
Jeff
Okay. And then, Dave, you know, back to kind of the common question we're getting right now from folks is just about the integrity of backlogs. And, you know, historically the larger the down payment, you know, and the higher the integrity of the backlog. But has the dynamic changed with the customer base at all? Can you capture more up front to get people, you know, and kind of secure them spots in line that,
Dave Regneri
know perhaps capture a little bit of a premium on on the supply and demand imbalance that's occurring right now yeah i mean at the end of the day we think the integrity of our backlog is quite strong okay and let me tell you why um in our resi business with our independent wholesale distributors technically they can't cancel orders so we don't see that backlog going away we do see a small amount of maybe double ordering from dealers But it's insignificant in respect to a $5.4 billion backlog. In commercial HVAC, we're dealing with complex systems and highly engineered products and working closely with engineers and architects and end customers. And, you know, you may see a job site delay, but you're not going to see duplicate orders. And in Thermal King, you know, we're working closely with our customers and we're matching their demand with with other OEMs, whether it be on the trailer side or the tractor side. And all of us are working together to make sure that we can combine the solution for the customer and everything gets there at the same time. So we don't see those orders being canceled as well. So overall, we think the backlog is strong. As far as your question about demanding more money up front, We're not doing that, certainly in the Americas or in EMEA. That has always been a practice in parts of Asia, which we do. But we're not going out and demanding cash from our customers because of the incredible amount of demand that we're seeing. That's not what trained technology is about. We want to solve our customers' most complex problems and work with them, and that's what we'll continue to do in the future.
Jeff
Sounds good, Dave. Good luck. Thank you.
Dave Regneri
Okay. Thanks. Appreciate it.
Operator
The next question is from Joe Ritchie with Goldman Sachs. Your line is open.
Joe Ritchie
Thanks. Good morning, everyone. Hey, Joe. How are you? All good. Thanks, Dave. So just maybe we'll start off on this price cost question. So, Chris, the $30 million to $40 million headwind in 1Q, whatever details you can give us on how that's supposed to look for the rest of the quarters throughout the year. And then specifically on pricing, I'm just curious, what are you baking in for resi pricing in 2022? Yeah.
Dave Regneri
Hey, Joe. So I'm going to start with the second question first. So on pricing, just to remind you, we had about three price increases across the majority of our portfolio in 2021. really an unprecedented level of price. And on a full year basis, it's three and a half points of price at the enterprise level across the company. So really very, very strong. We are announced and in place what I'll call the first price increase of 2022 that really started here in January and that applied to the majority of our products. So it's based on the inflation rate that we see today. And as nimble as we were last year, and I think we saw the industry follow, you know, we're going to remain nimble as we go through the year, as we kind of evaluate inflation. On the price-cost dynamic, exactly. We're carrying over, you know, significant price from the fourth quarter into Q1. We're carrying over a significant level of inflation that nearly offset the price in the fourth quarter. We were slightly price-cost positive in Q4. And we see that right now being negative in the first quarter and likely negative on the first half. Again, in the first quarter last year, we saw a very strong price. We got ahead of the market and competition in terms of the timing of our price announcements. And we had some very modest inflation in the first quarter last year. So that helped drive that near 50% leverage in the first quarter a year ago. So we're going to unfortunately lap against very modest inflation in Q1. We see inflation for the year. It's really a mirror image of 2021. 2022 is the first half of 2022 is going to look a lot like the second half of 2021 in terms of the inflation. And then we start comping in the second half of the year to much more modest inflation or comparable inflation inflation. starting in the third quarter. So I think right now our best view is we're probably price-cost negative in the first half, and then it returns to really very good strength in the second half of the year and strong leverage.
Joe Ritchie
And, Chris, maybe just following up on that point in the second half, we've talked about inflation, but how are you guys thinking about, you know, cost curves coming down in the second half, and are you baking in deflation into your numbers in 2H as part of the guides?
Dave Regneri
Yeah, I'd say we're not baking a whole lot of deflation into the guide, Joe, to be fair. I mean, I look at copper and aluminum futures, and they're pretty narrow from now until the balance of the year. So I don't see a lot of deflation there. What's starting to show a bit of deflationary impact is steel. Let's see where it goes. But at this point, if we start seeing deflation there, that would really impact us starting six months out from today, just based on our buying habits. and are locking in a steel price for six months so it turns out we start seeing a deflationary environment which we're not counting on but if we start to see that then we'll see how that plays out in the second half of the year but that could be a tailwind then okay great thanks guys thanks jim thanks the next question is from joel tis with bemo your line is open hey guys how's it going Hey, Joel, how are you? Congratulations. I hear that retirement is in your future. Congratulations, and thanks for all your great coverage of train technology slash Ingersoll ran through the years. We certainly appreciate it. We'll miss you.
Joe
Yeah. Well, let me see if I'm going to be any good at it or not.
Dave Regneri
We'll get you some fishing rods, okay?
Joe
Yeah, there you go. And just two longer-term kind of questions. I wonder if you can talk a little bit about any factors, you know, kind of, I don't know, being the new guy and all that kind of stuff, and looking over the next five years or so, like what are the factors you see that could really cap the upside on your operating and your EBITDA margins? Like what do you have to work on today to make sure that there's no bottlenecks five years out?
Dave Regneri
Yeah, Joel, it's a great question. And it really has to do with ensuring that you're continuously investing in innovation for the long term. And, you know, you heard Chris talk a little about it, you know, even though we know the first half of this year is going to be tough, right? We're going to struggle through supply chain constraints. We got a mirror image hitting us with inflation. We'll have strong price, but we'll have some carryover strong price as well. So we know the first half will be tough. What we're not going to do in the first half is we're not going to cut our investments because we know that's about our long term. And really where we see this is the whole decarbonization of what's happening and our products about making this world a better place for next generations. That's our purpose. That's what we're committed to. And you're going to continue to see that from trained technologies. I had a call the other day with some ESG investors, and they asked me what I was most proud of for ESG for train technologies. I thought about it for a minute. It caught me a little bit off guard, and I was like, I'm proud of the fact that train technologies was green before it was cool to be green. And, you know, we've been working at this for a long time. Since 2013, we had our first set of science-based targets. We now have our second set of science-based targets. And we are committed to making a difference, and we're going to do that through our innovation. We're challenging what's possible, and it's going to be a tremendous upside for trained technologies over the long term.
Joe
And then last, can you just give us a little sense of, you know, maybe it's a little – kind of a little far out there also. But what are the impacts on the transport business from trucks turning to EV?
Dave Regneri
Yeah, electrification is a big part of our strategy there, Joel. So you're again, once again, you're on top of your game there. So yeah, we have, in fact, we have a couple, our unit that's going up and down the highways. If you're in California, you may see it. That is a trailer unit that is 100% electric. And so we have a lot of really neat innovation we're working on there. Our customers are loving it. The data that we've been able to extract from the units that's going up and down the highway is tremendous for our engineers to continue to develop. Anyways, think about EV vehicles. Think about Thermal King as, once again, staying ahead of the market there with electrification of our products. We have some really neat products that we came out with about, I guess it was 18 months ago now, in the home delivery, and we're getting a lot of traction, a lot of traction around the globe with those products.
Joe
All right. Thank you very much. All right, Joel. Good luck to you, okay? All right.
Operator
Congratulations. The next question is from Steve Tusa with JPMorgan Chase. Your line is open.
Steve Tusa
Hey, good morning, guys. This is Pat on for Steve. My first one is on the commercial HVAC business. Can you break down your organic growth expectations for this year between what you expect for services versus equipment and then within that equipment piece, unitary versus global pod, if possible?
Dave Regneri
Hey Pat, it's Chris. I'll start. Look, we expect strong growth equipment and services on a full year basis. As we've talked in the past, you know, applied orders and install base drives a nice service tailwind. And just given our orders and backlog that we have in 2021 carrying over into 2022, we expect the services business to grow as well. So I'd leave it at that for now. We'll kind of update as we go quarter by quarter, which we typically do to highlight the growth in each of the categories. But we've got some good growth planned for both this year. The other thing I would add, Pat, this is Dave, is our service business performed very well all year in 2021. And in the fourth quarter, order rates for service were up over 20%. And I don't expect it to grow at 20%, but we're seeing very, very nice growth for our service business, really not just in commercial HVAC, but in our commercial HVAC on a global basis, nice service growth. And a lot of that is on intelligent services as well, and this would be with our connected solutions. And so that side of the business is growing very nicely for us.
Steve Tusa
Okay, I had to try. And then on the first quarter and first half versus second half dynamics, I may have missed this, but did you say if any particular end market drives the slow start in volume growth and in Bresi specifically, do you think there's going to be much difference between first half versus second half growth dynamics?
Dave Regneri
I don't know. Just to be clear, right, the first half that was constraining growth in the first half isn't the end markets. It's the supply chain, and specifically its components within the supply chain, which is really around electronics. So it's not end markets. As you see through the fourth quarter, our end markets continue to accelerate, which is a good sign. I wouldn't think of it as As Chris outlined, we've got some tough comps in the first quarter, the first half. We've got inflation rolling over. We have price rolling over, but we also have some tough comparison against price. But we will have a choppy supply chain at least through the first half of the year. We see some light through the clouds there as we head into the second half of the year.
Steve Tusa
Got you. And so that supply chain impacts resi and commercial and transport kind of equally is what you're kind of saying. I think it unfortunately affects most industrial companies. Yep. Makes sense. Thanks for the time. Appreciate it. Sure. No problem, Pat. Thanks, Pat.
Operator
The next question is from Andrew Obin with Bank of America. Your line is open.
Andrew Obin
Hey, guys. Good morning. This is Emily Shuan for Andrew Obin.
Dave Regneri
Hi, Emily. How are you? Hey, good morning.
Andrew Obin
Hey, I'm good. So I had a question on IAQ. You had previously guided to IAQ being one to two points of additional revenue growth tailwind per year. Does that still stick, and where do you expect that to land in 2022? And have you seen any momentum in demand for IAQ products given the Omicron surge? Thanks.
Dave Regneri
Yeah, we said early last year that we thought revenue would be in the 1% to 2% tailwind from IAQ. It's actually, it would be a little bit north of 2%, actually. So the year ended up very well for our indoor air quality solutions. And remember, indoor air quality is not new to train technologies. We've been in it for quite some time. But we have launched several new initiatives there, especially on the audit side and what we call day one, day two. You know, we're going to continue to see tailwinds from indoor air quality. I wouldn't expect 2% to compound every year, but we do expect to see nice tailwinds from indoor air quality, and we're seeing a backlog continues to grow. I will tell you that it's... It's probably harder to count because these indoor air quality solutions are becoming embedded into our equipment. So think of it as like a unit controller in a in a unitary piece of equipment, right? Indoor air quality is just becoming part of the systems. But with that said, we continue to push the envelope there. We've got some great innovation in the pipeline. Really cool things we're doing with our transit bus business and Thermal King. And we're still making a lot of traction with dry hydrogen peroxide as well as some of our photocatalytic solutions.
Andrew Obin
Awesome. And then what kind of visibility do you have on the already passed federal stimulus for K-12 education? For example, are there any projects you can sort of trace back to stimulus funding, or do you have a sense of the scope of how much stimulus has been spent on HVAC since the bills were passed? Thanks.
Dave Regneri
Yeah, I don't know if I get that specific, but I would tell you that we – we have a uh a dedicated tiger team that that works on this so we know where how the funding is flowing and there's a lot of restrictions as you dig into the detail and you may know this you may not but you know some of the stimulus funds have to be going to the education side versus the infrastructure side but we're working with our customers we're helping them navigate that those dynamics that exist there. And absolutely, we are seeing the funding going all the way through to the local school districts. And we're there with our customers on day one, helping them on what they could do day two, actually helping them deploy capital on what they should be doing over the long term.
Andrew Obin
Great. Thank you.
Operator
Sure. The next question is from John Walsh with Credit Suisse. Your line is open.
John Walsh
Hi. Good morning, everyone. Hey, John. How are you? Good morning. Doing well. Thank you. Hey, maybe just the first one as a clarification. When you were talking about the tough order comps, obviously they're across the board, but you did highlight that some of those product lines might see declines, I think. I just wanted to understand if that was an enterprise comment or specific to those particular product lines you called out.
Dave Regneri
yeah i mean it's certainly going to be the case within our thermal king business okay if you think about it i mean our bookings rate last year was twice our order rate right so bookings up over 70 percent that's not going to continue um and that will we have a very strong backlog there john so that will burn during the year so don't be surprised if you see a a quarter or two of negative bookings within thermal king um but you really need to combine Incoming order rates with backlog and really be looking at what the output is through revenue. Yeah, our view now, John, as we kind of look through the year is ending 2022 and starting 2023 with a very strong backlog, well above what a historical level will be. So to Dave's point, one or two quarters of some comping against some very strong order growth. But we see by the end of the year, that's still being a very healthy backlog going into 23. And we'll have tough comps in resi too, okay? Just so you're aware. Just on the backlog, I just want to make sure everyone's clear. Our backlog would be $5.4 billion it was at the end of the year. If you look at that as a percentage of our midpoint revenue guide, it's like 35%. And in a normal year, your backlog would be like 20. So, I mean, we have a very, very, very strong backlog for the year.
John Walsh
Great. No, appreciate that. And maybe just a quick one on uses of cash. Obviously, you called out elevated spend for repo in January. How does the deal pipeline look, you know, as you're thinking about the balance of the year and toggling between share repo and M&A? Thank you.
Dave Regneri
Yeah, our M&A pipeline is robust, and we look at a lot of opportunities as you would imagine being a major HVAC player in the industry. So we always have a full pipeline that we evaluate. John, I would add on the $1.9 billion to M&A and share repurchase, we did repurchase $350 million here in January. So let's say approximately $1.5 billion left to deploy in the year. And from a modeling perspective, just given we can't identify yet how much is to be spent on M&A versus share repurchase, for our guidance, we just assumed the whole $1.5 million remaining would be to share repurchase kind of ratably over the remaining quarters of the year. So we'll update everyone as we go quarter to quarter, but certainly a preference would be to spend some value of that $1.5 billion on M&A.
John Walsh
Great. Thanks for taking the questions. Appreciate it. No problem. Thanks, Jim.
Operator
The next question is from Gotham, Canada, with Callan. Your line is open.
Dave Regneri
Hi. Good morning, guys. Hey, Gotham. How are you? Good morning. Doing well. Doing well. Hey, I just wanted to follow up. I think it may have been Joshua asking a question on this, but can you talk a little bit about how in the commercial space,
Jeff
if at all, if the business model is evolving.
Dave Regneri
So, you know, customers concerned about ESG targets of their own, presumably utilizing HVAC as a tool to hit those targets, as opposed to just pay back on energy savings or whatever as a stimulant to demand.
Jeff
Are you seeing like performance contracts where if you can guarantee certain greenhouse reductions, you get paid for it? It's just sort of the terms of sort of the contract, you know, they change it. in any meaningful way? And does that maybe allow for some pricing power in commercial that didn't exist before?
Dave Regneri
That's a great question. I would tell you that it's very, very early innings there. But obviously, there's a lot of questions. We're getting calls from customers and asking how we can help them, you know, decarbonize their built environment. And, you know, one of the things we did that was maybe a little bit different than some is we actually went out and practiced on ourselves first. So part of our commitments is to reduce our own greenhouse gas. So we're implementing best practices and many of our facilities as well so that we could take customers there and show them what we've done. But, uh, But you're certainly on to, you know, the decarbonization as a service type environment that is getting some traction. I would tell you it's very early innings, but it's getting traction.
Joe Ritchie
And just as a follow-up, do you think it actually confers kind of greater pricing power in the commercial market, I mean, over time, than has been the case historically where we think of, you know, it being more competitive than in Reggie, for example?
Dave Regneri
Yeah, it's a fair question. I think we'll be able to write that chapter probably in the coming years here. But I would tell you that whenever we've had products and services that have high efficiency, that have complex problems to solve for our customers, we tend to do very well.
Jeff
Appreciate it, guys. Thank you. Okay, thanks.
Operator
The next question is from Dean Dre with RBC Capital Markets. Your line is open.
Josh
Thank you. Good morning, everyone. Hey, Dean.
Dave Regneri
How are you?
Josh
Morning. Real well. Thanks. I might have missed this, but did you size any revenue pushout from 4Q into the first quarter that would be comparable to the 130 that got pushed out from 3Q?
Dave Regneri
Yeah, I mean, we did not. Okay, so you didn't miss anything. But But obviously, we did have revenue, we did have some revenue that pushed out from q4 into future periods, it's probably in the same realm that we saw going from q3 to q4 in that 150 million range. One thing that's different there in the fourth quarter, We had visibility working with our suppliers that we would recoup about half of that in the fourth quarter, which we did. We do not have that same visibility as we enter Q1, so obviously we're not including that in our guidance.
Josh
Not including the guide for the first quarter. Is that it? That's correct.
Dave Regneri
That's correct.
Josh
Got it.
Dave Regneri
Obviously, the backlog will churn, and it'll be within the year for sure, but not in the first quarter.
Josh
Is that mostly electronic components still?
Dave Regneri
Yeah. Yeah. Electronic components is still, you know, the biggest concern we have. You know, there have been some areas of supply chain that have improved, as I said earlier, but electronic components, We still have some significant choppiness there.
Josh
Ray, just last question from me. On the increase in CapEx for the year, you referenced some higher returns. Can you size for us what kind of returns you're getting on these projects and maybe an example of your own decarbonization investment you're doing?
Dave Regneri
Yeah, Dean, I think we see multiple categories kind of driving a little bit higher CapEx. Again, still within our range of 1% to 2%, but right now expecting it to be closer to 2% in 2022. The categories would be around capacity expansion, driving further automation in the plants, supply chain resiliency projects here as we kind of manage through this transitionary year in 2022, improving front-end systems. Maybe one thing to highlight on a sustainability side, as we take older pieces of machinery offline, there's examples where you've got three pieces of machinery in a factory that you're able to deploy one piece of machinery today, just given improvements to technology and efficiency. And for us, that should have a lower impact on the environment, a lower impact on energy usage. So those are the types of things we continue to lean in. I was out at one of our factories in the Midwest, and they were showing me examples where they literally had four old pieces of equipment, and they took them out of service. These were old pieces of equipment that our prior mindset would have been, The asset's fully depreciated. I only run it 40% of the time. I don't need the space. We take those out. We put in a new piece of equipment, dramatically reduce the energy load in the facility. You know, in many cases, you're able to increase throughput with a newer machine, with newer technology. And it's just a great program that they're working through, as are many of our factories around the world. So it's sort of what we're talking about all the time is don't wait for new. You don't need to wait for new technology. Deploy what's available today, and you're going to get significant benefit. And it's the same. What we say is what we do.
Josh
All sounds good. Thank you.
Dave Regneri
All right. Thank you. Thanks.
Operator
That concludes our question and answer session. I'll turn the call over to Zach Nagle for any closing remarks.
Zach Nagel
Great. Thanks, Chris. I'd like to thank everyone for joining us on today's call. As always, we'll be around for any questions that you may have between days and weeks, and we look forward to hopefully seeing many of you on the road in 2022. Thank you, and have a great day.
Operator
Ladies and gentlemen, this concludes today's conference call. Thank you for participating, and you may now disconnect.
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