Greetings, and welcome to the Gibraltar Industries Fourth Quarter 2024 Financial Results Conference Call. At this time, all participants are in a listen-only mode. A question and answer session will follow the formal presentation. If anyone should require operator assistance, please press star zero on your telephone keypad. As a reminder, this conference is being recorded. At this time, it is now my pleasure to introduce Carolyn Capaccio, with Alliance Advisors IR. Thank you, Carolyn. You may now begin.

Thanks, Rob. Good morning, everyone, and thank you for joining us today. With me on the call is Bill Bosway, Gibraltar Industries' Chairman, President, and Chief Executive Officer, and Joe Lovechio, Gibraltar's Chief Financial Officer. The earnings press release that was issued this morning as well as the slide presentation that management will use during the call are both available in the Investors section of the company's website gibraltar1.com. Gibraltar's earnings press release and remarks contain non-GAAP financial measures. Tables of reconciliation of GAAP to adjusted financial measures can be found in the earnings press release that was issued today. Please note further that adjusted results exclude the net sales and operating results of the Japan Renewables business that was sold on December 1, 2023. Also, as noted on slide two of the presentation, the earnings press release and slide presentation contain forward-looking statements with respect to future financial results. These statements are not guarantees of future performance, and the company's actual results may differ materially from the anticipated events, performance, or results expressed or implied by these forward-looking statements. Gibraltar advises you to read the risk factors detailed in its SEC filings which can also be accessed through the company's website. Now, I'll turn the call over to Bill Bosway.

Good morning. I wanted to thank you for joining today's call. I'll start with our 2024 results, and then we'll review our outlook and plan for 2025, and then we'll open the call up for questions. Let's turn to slide three. About our 2024 year-end review, and we'll start actually with our fourth quarter. Our fourth quarter performance is closely aligned with expectations in each segment. Ending the year with EPS at the top end of the outlook range and net sales just under the range. During the quarter, net sales were down 7.9% driven mainly by ongoing market issues facing the renewables business. But despite down revenue, we improved operating income 11% or 210 basis points. We increased adjusted EPS 17.4% and we improved adjusted EBITDA 220 basis points. As well, when you look at the collective performance of the rest of the portfolio, residential, ag tech, and infrastructure businesses, our results in the quarter showed additional performance improvement with net sales down 3.9% versus 7.9% for the total business, and operating income improving 45% and operating margin expanding 480 basis points, and EBITDA improving 32% and EBITDA margin improving 460 basis points. So solid performance in these three businesses, which helped to offset some of the market and business challenges our Renewables team continued to work through. Let's talk about the full year. Consolidated net sales were down 3.9% to $1.31 billion as both our residential and renewables businesses navigated less than favorable end market dynamics. That being said, on an adjusted basis, operating margin, EBITDA margin, and EPS all expanded with margin improvement in three of our four segments. We also generated $174 million in operating cash flow and $154 million in free cash flow or 12% of net sales. The collective performance of the residential, ag tech, and infrastructure business was also positive for the full year. Net sales were down slightly 1.9% versus 3.9% for the total business. And operating income improved 12% with operating margin up 180 basis points and EBITDA improved 10% with EBITDA margin also up 180 basis points. So again, solid performance in these three businesses as we work through market execution improvements in renewables. Backlog at year-end was down 24% as new bookings driven mainly by timing of new orders both renewables and ag tech moved from the fourth quarter into the first quarter of 2025. Since the start of the year, order activity has increased for both businesses. And to date, versus prior year, renewables bookings are up 33%, and ag tech bookings are up over 300%. And both businesses maintain an active pipeline of additional opportunities as well. Our infrastructure business is also seeing solid demand with its backlog up 10% coming into 2025. And residential demand has also improved as participation gains awarded in 2024 are now beginning to materialize in the first quarter. Relative to portfolio management, just last week, we expanded our AgTech structures business with the acquisition of Lane Supply, an industry leader in the design, manufacturing, and its delivery of canopies serving convenience stores, quick-serve restaurants, travel centers, food retailers, and EV charging stations. We're very excited to have Lane join Gibraltar. We'll talk more about them later in the presentation. Now we're going to jump into each of the business segments, and Joe will get us started.

Thanks, Bill, and good morning, everyone. Let's start with residential on Slide four. Net sales for our residential segment decreased by $8.6 million or 4.8% driven in part by point-of-sale softness in some regional residential markets, 80/20 product line simplification initiatives for safety harnesses and drywall metals, and by the delayed transition of new business awarded in 2024. Order activity in our building products business has accelerated since January, and we're now benefiting from participation gains earned last year. New products that we launched in the second half of 2024 are gaining momentum, and we expect to have all locations completed on our ERP rollout by the beginning of 2026. Now turning to margins, our adjusted operating and EBITDA margins decreased slightly and were flat respectively, primarily related to volume and product mix. Our execution, price-cost management, and 80/20 initiatives delivered solid results in the quarter and largely offset this volume and mix pressure. During 2024, we successfully rolled out our ERP system to additional locations and expect to have all locations completed by the beginning of 2026.

Also during the quarter, we divested our electronic locker business and reported a $25 million gain on that sale. So let's move to slide five for an update on the residential market and our participation expansion initiatives. For most of the year, really starting in the second quarter, the market has been relatively sluggish with ongoing softness in new and existing home sales. The degree or magnitude of market strength or weakness really has varied by region, state, and in many cases at the local MSA market level. In general, point-of-sale counts reflect a down market of 3% to 4%, but again, it's important to understand this data at the store and local market level to get a more accurate picture of the market. When you review the ARMA data, which really reflects shingle shipments or receipts around the country for 2024, and you look at it from the state level, you'll see a wide variety of results. For example, Texas, which was the number-one state for shingle receipts in 2024, was up 10% for the year but has been growing at a slower rate over the last few quarters. Break that down by individual MSA within the state, you'll see different trends as well. Florida, which was the number-two state for shingle receipts in 2024, was down 18% for the year which showed positive growth in the fourth quarter. We expect the Florida market to normalize more in 2025 now that the impact of Hurricane Idalia is no longer a factor. So ultimately, the market and our ability to grow is dependent on unique circumstances impacting specific MSAs, interest rate levels, general affordability, and how well we are positioned in the most attractive MSAs, which we continue to work on. Also, as Joe mentioned, our revenue in the quarter was impacted by 80/20 product line simplification issues, exiting both our safety harness and drywall metal accessories product lines, both of which were not providing the revenue growth and margin profile we need to support the overall plan. In addition, as I mentioned in our last quarter call, the timing of orders from new business awards in 2024 did not come in 2024 as originally expected, but we have started to see orders materialize since the beginning of the year. So we are looking forward to 2025 with our top priority being the expansion of our presence in the local markets we've identified that are the most attractive for us. We recently opened a new location in Boise, Idaho, and we will expand and optimize our presence in the West and the Pacific Northwest with three additional locations in two other regions. We'll pursue both organic and inorganic initiatives and we are actively involved in both at this time. As well, our new products, both our rolled vents and our pipe boot ventilation, are getting traction that will contribute to growth in 2025. We will also continue to invest in our omnichannel customer market initiatives, both technology and competencies, to best support optimized local market channel requirements. Finally, we've been developing plans since January in each of our businesses to deal with the particular impact of recently announced tariffs on aluminum and steel. Each of our businesses will approach this in a timely manner with solutions tailored for their businesses. The tariff landscape will likely continue to be dynamic with changes driven by a number of reasons. Overall, we expect to generate growth and margin expansion in our residential business in 2025. So let's move on to renewables. Turning to slide six, renewable adjusted net sales decreased $16.3 million or 18.8% and backlog decreased 32% during the quarter. As we discussed in our third quarter call, sales and bookings were suppressed in the second half of the year as customers focused on completing panel installations and administrative documentation ahead of the December 3, 2024 deadline related to the June 2024 expiration of the presidential proclamation. Since the start of 2025, new bookings have accelerated and we're up 33% versus prior year. Adjusted operating and EBITDA margins decreased 630 and 550 basis points respectively, impacted by the ramp and product mix shift toward our recently launched one-P tracker products along with lower volumes that resulted from the above-mentioned deadline. Adjusted margins expanded sequentially by 70 basis points as a result of improving tracker operating efficiencies. And on a GAAP basis, we incurred a $5.3 million non-cash charge for the discontinuation of our legacy RVI trade names in this segment. So let's move to slide seven, and I'll give you an update on overall renewables demand and our one-P track launch. You recall, as we discussed in our last earnings call, we said we would expect new orders to start improving once we finished helping customers meet the December 3 deadline that Joe just referenced. Since the start of 2025, new bookings have accelerated and are up 33% versus prior year, as Joe mentioned. In all of our technologies—whether it's Tracker, Fixed Tilt, Canopy, and EBOS—are contributing accordingly. The pipeline of new opportunities is also positive as customers continue to invest in solar and build their project portfolios. The right side of this slide provides an update on our TareTrack one-P technology, which continues to see positive customer support, and we see that through ongoing growth and new bookings. Since our launch in November 2023, we've booked over 400 megawatts across seventy-seven projects with twenty-two different customers. We started seven additional projects in Q4 with another eighteen scheduled for the first half of 2025. As well, we're actively engaging customers that are looking to build up to 1.9 gigawatts in the U.S. distributed generation market. So the market remains relatively robust. On the operations front, our team worked diligently throughout 2024 to keep pace with the speed and magnitude of demand we experienced shortly after our one-P pilot launch. Frankly, we did not anticipate the customer uptake nor were we or our key suppliers ready to support the demand in the time frame it happened. We were also challenged with quickly scaling the process as required to coordinate shipment for a tracker project in an effective way, and we did not have our internal distribution center operating to support our growing list of projects. Throughout the year, we improved our supply chain on three fronts. First, we now have most of our suppliers on permanent tooling versus temporary tooling that we started with, and we are close to being caught up with our demand. Secondly, we have onshored and insourced some of our most critical components thus reducing some of the logistics complexity, as well as working capital and cost. Third, we have a single site for suppliers to ship to: our internal distribution center. Our first shipments from our distribution center to the field are happening as we speak. So we know we have more to do, but our ability to execute one-P projects today and in the future has improved substantially versus where we started over a year ago, and I believe this will drive improved performance as we move through 2025. Let's turn to the next slide, slide eight, and give you a quick update on the market. I believe everyone is somewhat familiar with the various regulatory and trade issues that the industry continues to manage. Today, I highlight the second AD/CVD complaint, which was filed last April. This complaint alleged illegal trade practices by Cambodia, Malaysia, Thailand, and Vietnam and asked the Department of Commerce as well as the U.S. International Trade Commission to apply new tariffs for both anti-dumping and countervailing duties related to imported solar cells and modules from these countries. Effectively, issuance of final orders for both antidumping and countervailing duties should be complete by April 3, 2025. At that point, there should be more clarity for our customers as to the cost associated with panels imported from these countries. Now let's switch gears and talk about the current environment. Like the rest of the industry, we are monitoring daily. In general, there is the potential for a number of scenarios to evolve, but our view today for 2025 is that there may be some, but not drastic, changes in the various tax benefits currently available to the industry. Currently, tax credits do not seem to be in focus for the administration, but there is a view the administration may take some changes or modifications like lowering the ITC benefit or phasing it down faster and potentially assign a domestic content requirement on developers to earn it. If a domestic content requirement happens, domestic sourcing becomes more critical. So the fact that we started our U.S. supply chain onshoring effort in 2024 should put us in a solid position to support this new requirement. Regardless, our customers will need to be prepared for change and be flexible accordingly. For 2025, again, as I mentioned last quarter, our revenue plan is built on a slower first half and a stronger second half. The rationale is straightforward: new bookings in the second half of 2024 drive lower sales in the first half of 2025, and positive bookings early in 2025, which are up 33% to date, support higher sales in the second half of 2025. Also, without better clarity on what changes the administration might take in 2025, if any, we are taking a conservative view on industry demand for now. As a result, we built our full-year renewables plan based on flat to down revenue and delivering stronger margin performance through better execution versus prior year. Finally, I believe the second-half run rate for this business in 2025 should be very reflective of the operating cadence we expect going forward into 2026. So with that, let's move on to AgTech.

So moving to slide nine, AgTech net sales increased about 1% as project start dates moved from the fourth quarter into the first half of 2025. The timing of new project signings caused Q4 backlog to decrease 23%, which is already reversed in the first quarter. Since fourth-quarter end, we have signed over $45 million of new bookings and demand remains strong with a solid pipeline of opportunities in process. For the year, AgTech net sales grew over 8%. Segment adjusted operating and EBITDA margins each expanded over 2200 basis points, driven by strong execution and business mix, as well as a benefit from a customer payment received this quarter that had been written off in the prior year's quarter. Excluding this payment, operating margins expanded 1000 basis points to approximately 15%. Our GAAP results also include a $6 million non-cash charge for the discontinuation of our legacy RVI trade names in this segment.

Alright. Let's move to slide ten. I want to talk a little bit more about our revenue momentum in this business as well as the work we've done to broaden our customer base. We continue to broaden our customer base across North America and win opportunities to support customers as they expand capacity through not just the construction of new facilities, but also opportunities to retrofit, expand, and service existing facilities. In the last six weeks, as Joe just mentioned, we've signed $45 million of new contracts, which represents an increase of over 300% versus last year. I expect positive bookings momentum to continue in 2025. We are fortunate to have great customers that are continuously pushing us to help them innovate, solve problems, and create opportunities. Today, I want to highlight two customers: The Sensei Group, founded by Larry Ellison and Dr. David Agus, and Tommy's Car Wash, a large family-owned car wash business operating across North America. The Sensei Group has a vision to improve human nutrition while preserving the world's natural resources using controlled environment agriculture facilities to supply fresh produce for local communities. Fundamentally, the group understands there are more people than there is food and this imbalance is something they would like to focus on and fix. Sensei has growing capacity of 15 pounds per year of fresh lettuce, melons, and tomatoes. This picture shows one of the Sensei facilities we have worked together to redesign and retrofit to increase capacity as well as flexibility to additional types of produce. Our respective design engineering project teams meet every week and are fully engaged on what's next. On the structure side of the business, we partnered with Tommy's Car Wash for turnkey solutions including design, manufacturing, and installation. This is an example of applying our many years of structural engineering and structures competency to a car wash application where performance, aesthetics, and structural integrity contribute significantly to our customer's strategy. For this business in 2025, organically, we expect the agtech business to deliver solid growth and operating margin improvement versus 2024. Based on the current timing in their project schedules, the business should accelerate into Q2 with a good cadence and pace throughout 2025. We also expect to book additional projects and further build our backlog for 2025 and 2026. Now let's move to slide eleven and talk a little bit about the acquisition of Lane Supply. So on February 11, just last week, we acquired Lane Supply. It was a market leader in the design, manufacturing, and installation of canopies applied in a variety of end-use applications, as I mentioned earlier. The U.S. canopy market is approximately $1.8 billion growing at mid-single digits, and Lane has established itself as one of the industry leaders. Lane was founded in 1950 and is headquartered in Arlington, Texas. Its core competencies match really well with Gibraltar and include structural engineering, structural management, water and moisture management, electrical design optimization, and applying customer branding and badging solutions to its structures. We paid $120 million in cash and in 2024 Lane recorded net sales of $112 million and adjusted EBITDA margin of 14.8%. We expect this transition to be accretive in 2025 and Lane currently has over $150 million backlog heading into this year. We really look forward to partnering on customer and operating synergy opportunities. Now let's move on. We'll talk about the infrastructure business. Let's move to slide twelve. Our infrastructure net sales decreased $1.3 million impacted by the timing of a large project in the prior year. Backlog at quarter end increased 10% driven by new projects and strong conversion of bid volume. Demand in quoting remained robust supported by ongoing investment at the federal and state levels. Segment adjusted operating and EBITDA margins improved 180 and 170 basis points respectively driven by a favorable mix shift and continued strong operating execution. We expect continued strength in sales and margin expansion in 2025.

Let's now move to slide thirteen to discuss our balance sheet and cash flow. December 31, we had cash on hand of $270 million and $395 million available on our revolver. During the quarter, we generated $19.9 million in cash and operations net income which funded a working capital investment of $23.3 million. For the year, we generated $174 million in cash from operations including cash generated from working capital of approximately $7 million. Our free cash flow generation for the year was 11.8% of sales, above our outlook of approximately 10% of sales for the year. During the year, we used $10 million to repurchase approximately 155,000 shares of common stock. At year-end, over the life of our current share repurchase program, we have repurchased approximately 2.7 million shares of common stock at an average price of $45.14 and we had approximately $79 million or roughly 40% remaining under this $200 million stock purchase authorization. Our revolving credit facility remains untapped, and we remain debt-free. As mentioned, we acquired Lane Supply on February 11 for $120 million in cash, subject to customary working capital and other adjustments. We expect to continue to generate strong cash flow in 2025 and our capital allocation priorities for 2025 are to continue to invest in our organic growth and operating systems for scale with capital expenditures approximately 3% of sales. As Bill indicated, we're exploring inorganic growth opportunities and have an active pipeline of high-quality M&A. Our strong balance sheet provides optionality and flexibility and we're focused in the near term on our residential and AgTech businesses. Last, we plan to continue to opportunistically return value to shareholders through the remaining authorization under our share repurchase program, funded by cash generated from operations and the use of our revolver depending on the timing of any M&A or repurchases. Now I'll turn the call back to Bill.

Alright. So turn to slide fourteen and let's talk about our 2025 guidance. Let me first clear the chart. The first column represents our 2024 results as reported. The second column represents our 2024 results excluding our electronic locker business which was divested in late 2024. For 2025, here's our guidance. We expect net sales will range between $1.4 and $1.45 billion, growing between 8% and 12%, driven by organic growth in residential, ag tech, and infrastructure; flat to down sales in renewables; and the inclusion of Lane Supply results from operations. Adjusted operating margin will range between 13.9% and 14.2% expanding 110 to 140 basis points. Adjusted EBITDA margin will range between 16.7% and 17% expanding 100 to 130 basis points. GAAP EPS will be in the range of $4.25 to $4.50, approximately flat to 2024. Adjusted EPS will be in the range of $4.80 to $5.05 representing growth of 13% to 19%. And free cash flow as a percent of net sales will reach 10%. Our 2025 plan is balanced and is built with consideration for the current macro environment, as well as specific end market dynamics our businesses have planned for and continue to work through. Overall, we expect to grow, expand margins, and generate strong cash flow. We will drive growth through participation gains in our existing businesses and the addition of Lane Supply, and we will improve margins in each business through core 80/20 productivity, price-cost management, and better execution in renewables. Overall margin expansion and stronger working capital will drive our cash performance as well. I do want to thank our entire team for delivering a solid year and closing out 2024 with good momentum. We are prepared and ready for 2025 and looking forward to delivering our commitment. So with that, let's open the call up and we'll take your questions.

Thank you. We'll now be conducting a question and answer session. One moment please while we poll for questions. Thank you. Thank you. And our first question today is from the line of Daniel Moore with CJS. Please proceed with your question.

Thank you. Good morning, Bill. Good morning, Joe. Thanks for taking questions. Let me start with residential. Revenue obviously held up really well in a tough demand environment through the first half and started to feel the effects of a slower residential R&R market by the second half. Do you see perhaps 2025 being kind of a mirror of 2024 and what kind of organic revenue growth range should we think about for H1 versus H2 on a year-over-year basis?

So, Dan, I don't know if it's going to be a mirror per se. We went into this year's plan with a view of the market similar to last year. We went into last year with something similar and we had participation gains that were driving the top line which got delayed, and now those are starting to kick in. We don't have a ton of growth built into the plan, but I think it's reasonable based on our market assumptions and the participation gains that are starting to kick in in January. I'd say low to mid-single digits in that range for the residential top line. On the recast around divested businesses, I think if you build in about a hundred million for Lane Supply, organic growth kind of zero to four percent is reasonable. I think more towards four than zero, but with the macro environment the way it's been, there's still a lot of questions out there, so we've been a bit conservative in the plan. We feel good about the organic plan in that range and Lane's going to contribute a nice chunk this year as well. We'll see how things evolve throughout the year, but feel good about the way the top line is built between organic and inorganic at this stage.

Got it. That's helpful. And then on renewables, new bookings accelerated up 33% in January—obviously a good initial sign. Can you provide a perspective: is that mainly catch-up from Q4 bookings or are we seeing a more sustained turn? And similarly, how do we think about H1 revenue versus H2 cadence?

If you recall, our bookings were down in the second half of last year because customers were laser-focused on getting through the December 3 deadline. That was quite consuming. The AD/CVD DOC investigation should be close to getting behind us; originally it was expected in February and is now April. We were suppressed on bookings, and we expected that would turn. The team's done a nice job of making that happen. From time a contract is signed and deposit received to when we start generating revenue for a project, it's about a six- to nine-month time frame. So if your bookings were down the second half of last year, your first half revenue this year is going to be suppressed as a result. The bookings coming in at the beginning of this year will contribute to revenue starting in the second half of 2025. So our second half is going to be stronger. It normally is anyway because of seasonality, but because of the bookings phenomenon I described, it's going to be stronger than the first half. So we've said we'll start out slow and then build momentum in Q3 and Q4. We need bookings to keep happening the way they have for that to be the case, and we've built our plan accordingly.

Okay. I'll jump back with any follow-ups. Thanks.

Our next question is from the line of Julio Romero with Citi. Please proceed with your question.

Good morning. This is Justin Machete on for Julio. Thank you for taking questions. On M&A, could you tell us more about your decision to acquire Lane Supply? How you filtered down to that business and how you're thinking about its immediately accretive nature?

Number one, we've been in the structures business for quite a long time, really going back about 80 years. It started in our greenhouse business and we have a lot of different types of structures that we design, create, manufacture, and install today, whether it's controlled environment agriculture or retail centers, car washes as I showed. The types of things Lane does are very much similar to what we've grown up with. Their end market is sizable and experiencing mid-single-digit growth. The synergies around what we do overlap. There's a nice opportunity to leverage not only on the customer side but also on the supply side and field installation and construction. Lane is a good operating company and we feel there's a lot of runway. If you just take last year's results, they would be accretive to us and we expect that to happen again in 2025. That's the story around Lane.

Thanks. And on guidance, looking at the year beyond the first half and second half cadence, can you talk about what would bring you to the upper and lower ends of guidance in terms of revenue and EPS?

There's a story for each business that builds to the total. On renewables, what's going to happen in that end market and what the administration might do with energy policy are considerations; we built conservatively. On residential, we're not expecting that market to be super robust; interest rates aren't likely to move dramatically. It really comes down to the timing of our participation gains—if some happen sooner or we open additional locations faster than planned, there could be upside. Conversely, timing could push the other way. AgTech will be a big contributor this year; there could be upside if orders flow in faster, but these are large projects with timing variability. Lane adds cadence because their projects roll out on a weekly schedule in many cases. We could have slight conservatism in our plan, but we think it's balanced. We don't require renewables to have a blowout year to deliver this plan; that's a prudent way to think about it given the current environment.

Thanks very much. That's all for me.

Our next question is from the line of Walt Liptak with Seaport Research. Please proceed with your question.

Hey, guys. Good morning. Thanks for the good quarter. I wanted to ask first about the residential delays as a follow-up. There have been a couple of earnings releases with these delays. Could you help us understand a little bit more about the size of these gains and how much is layering in now and how much more is there to go get?

You remember the Q3 impacts were around $4 million; on seasonality Q4 was probably a little less. For 2024, I'd say the impact was in the $5 to $6 million range. That has started to pickup and we started to see those orders, so our view is we'll pick that up this year and hopefully get a full-year effect. Also, our new products—particularly the pipe boot—those orders are starting to materialize. The opening of our Boise, Idaho facility, which we didn't have last year, will be impactful in 2025. We've got a variety of these things in the country whether it's geographic plays, more branches at a wholesaler, or more awarded business with a retailer. I expect our participation gains to be pretty impactful in the year. We don't currently have anything planned that would negatively impact sales like the product exits we did last year with safety harness and drywall metal. Those were probably five to seven million dollars of top-line impact last year that we've removed. Our focus is really on the participation gains and taking advantage of the ones we won last year and are working on this year.

Thanks. And thanks for going into the product line simplification program you did. We generally think of those as healthy and a good thing even though revenue goes away. Are you doing regular reviews of product lines as part of your 80/20 program? How robust is the 80/20 program at this point?

We haven't let our foot off the gas. Our pipeline of different types of 80/20 initiatives is as big as it's ever been. It's core to what we do. There are other things each business is working on that will make a big difference, but it's a big contributor toward our margin improvement opportunities and, in many cases, our top-line growth opportunities as well.

On the tariff issue, if prices go up, is there a chance for alternatives in the regions that you operate or is it cost prohibitive to switch to alternatives?

We brought our leadership team together in early January and assumed tariffs could occur and started factoring that in. Each business has a different starting point. If you're in project-based businesses, you need to make sure your contract clauses are right and your supply chain is aligned. In build-and-ship businesses like residential, we have indexes built into contracts that support movement on cost. We're proactive: conversations with customers have started and everyone knows something could change. We have plans in most businesses to execute when the time is right. We've been through extreme inflationary periods before and have playbooks to handle these situations. We'll be ready to take action and make adjustments as needed. Regarding substitution to alternatives in residential, contractors are conservative and reluctant to change quickly because they need predictable, reliable products and installation. If they have to substitute, those alternatives would likely see price increases too. Some of our new products are patented or cost-reduced which gives us more flexibility. Overall, I'm not overly concerned about substitution issues at this stage.

One last question: with the divestiture, you noted the reason was low revenue and lower margins. Do you go through regular annual reviews of different businesses and segments to assess fit?

Yes. We had our board together for two days in January on that very topic as part of our ongoing strategic planning. We have a committee in place and we review portfolio matters every quarter. If there's something we decide to pursue, it's reviewed at least annually and tracked each quarter. So yes, it's front and center with the board and the leadership team on a regular basis.

At this time, there are no further questions, and I'll turn the floor back to Mr. Bosway for closing remarks.

Listen, I just want to thank everyone again for joining us today. Coming up, we do plan to present at the Bell Pump Valve and Water Symposium, the Sidoti Small Cap Conference, and the 37th Annual ROTH Conference. Again, I want to thank everyone for your support for Gibraltar, and we look forward to speaking again after our first quarter report. Thank you.

Thank you. We will conclude today's conference. You may disconnect your lines at this time. We thank you for your participation. Have a wonderful day.