Nathan Jones: I’ll follow up on the guidance, I guess. I’d say at the midpoint, the guidance kind of employs margins up about 20 basis points and then an incremental margin of about 20%. Given some of the positives that you listed on the guidance slide in here, with positive mix with price cost expected to be positive throughout the year. I thought, maybe we could get a little bit better than a 20% incremental margin. Can you talk about what are the offsets to that? And what could end up driving that above that 20% incremental?
Ron Keating: Yeah. So Nathan, I’ll start, and let Ben pick up on it. But again, to the last comment, I make, we still feel like we’re balanced in our guidance going forward, just given some of the uncertainties that we see €“ the good thing about our pricing is our pricing is very sticky. So once we get it driven into the market, it continues to stay, if we see a pullback on inflationary challenges that we’ve been facing, and it doesn’t continue to run, I think there’s some opportunity there. And €“ but we’ve been pretty measured in what we’ve given as an outlook. Ben, you have a comment?
Ben Stas: Yeah. Sure. Nathan, I think one of the things we’ve got to stay measured on is fuel and freight, particularly with diesel. At this point in time in the short term, we’ll keep our eye on that. The materials were in really good shape on that side. You probably noted from the call that we were margin accretive on the price cost versus materials. So it’s really about managing fuel freight and improving our productivity. As expected, we on-boarded a lot of service techs. So we expect that productivity to improve as we go through 2023. So those are a little bit of the puts and takes overall in terms of saying measured on margin.
Nathan Jones: So it sounds like despite bracketing consensus, this is still a pretty balanced guidance that you put out here and pretty confident in it. My follow-up question is around Mar Cor. I think the Mar Cor revenue came in, it looks to be pretty substantially above what we had expected. I know, you guys are excited about the opportunities for that. So maybe you could talk a little bit more about the opportunities to leverage Mar Cor to grow the outsourced water business. Have you begun to see any results from that opportunity, or is that still on the come? And where you think you can take that business?
Ron Keating: Yeah, we are starting to see results from that, Nathan. And the opportunity to connect a lot of the Mar Cor solutions that are in the field and that we’re putting in the field, we’ll start to see that being realized this year in FY 2023. What we saw in growth really centered around life sciences fit very nicely with our core business. So we saw outpace growth in the core businesses that we’ve had in Life Sciences because of now the expanded offering we have carrying Mar Cor around. So, we’re able to do more for the customer base that we highlighted when we did the acquisition around the hospital system and a health care system with us being a full-service provider now. So, more positive about what the next two to three years are going to deliver with Mar Cor.
Nathan Jones: Is there some kind of growth target can you share on that?
Ron Keating: We’re pretty thoughtful in the way that we did the analysis. we think we’ll see double-digit growth come in the Life Sciences area, just based on our base business that is continuing to expand combined with Mar Cor.
Nathan Jones: Great. Thanks very much for taking my questions.
Operator: Our next question comes from Bryan Blair from Oppenheimer.
Bryan Blair: Thank you. Good morning, everyone.
Ron Keating: Good morning, Bryan.
Ben Stas: Good morning, Bryan.
Bryan Blair: Staying on Mar Cor for a minute, perhaps offer a little more on integration and how synergies are pacing relative to expectations. Growth seems to be great, margin perhaps a little more dilutive than anticipated at this point. I would the optics say that. Just curious what you can offer there and whether we should anticipate that Mar Cor gets to a level where it’s margin accretive to ISS during your fiscal 2023?
Ron Keating: Yes, great question. So I want to be clear. MarCor is right now accretive to Evoqua, but still dilutive to ISS. The synergies are coming through as expected. And also the sales synergies are coming through as expected as well. 2023 is probably a long put to be accretive to ISS, but certainly within reach in 2024. But we will see improvement as we go through the year and the synergies take hold. Remember, a lot of those synergies are footprint-related. So they take a little bit longer to get done, and we want to be very planful as we consolidate rooftops.
Bryan Blair: Understood. That all makes sense. And you noted — in terms of regulatory tailwinds, there’s some continued near-term uncertainty on PFAS regulation and how much of a catalyst that can be during fiscal 2023, perhaps looking to 2024 and 2025 that becomes much more material. Your team has been pretty consistent in framing that. Just curious whether the primary consideration remains the stringency of MCL or relative MCL versus MCLG in terms of what will be proposed or if there are other factors that we should keep in land?
Ron Keating: No, I think as we’re looking forward, we continue to be consistent with where it’s been framed in the past. We still have a pipeline around $100 million. We’re winning about 30% of those projects. The MCLs are set to be released at the end of this calendar year, so the first quarter of our fiscal 2023 we’re expecting that to happen. And at that point, then actually the municipalities and the water systems know exactly what they have to treat to. So you know where the goal line is. And that’s when I think we’ll start seeing a lot of the engineering work, a lot of the work that will start flowing down with funds flow that’s coming from the government down to the different water districts will be the latter half of 2023 and as you said, into 2024 and 2025.
Bryan Blair: Okay. Appreciate the color guys. Thanks.
