General Electric Company (GE) Earnings Call Transcript & Summary

Good morning. My name is Brendan Luecke, and I'll be covering the multi-industry sector for Bernstein. I'm very excited to welcome all of you to today's fireside chat with General Electric. Thank you for joining us. Before we get started, I want to touch base on a few quick housekeeping items. Our aim is to make this session as interactive as possible. [Operator Instructions] You can also press the triangle button on the live Q&A to have to upvote questions. We'll work popular topics into the conversation. With that, it's my great pleasure to introduce Larry Culp, Chairman and CEO at General Electric. Prior to joining GE in 2018, Larry served as CEO of Danaher Corporation for over a decade. Larry, it's an absolute pleasure to have you back to the SDC this year. I understand you have prepared some opening remarks, and we'll hand it off here.

Brendan, good morning, and thanks for joining us. We do have a few slides to walk through. But as you said, I think this conference is often the highlight of our year on the IR trail, largely because of the interactions we have with investors. So we'll get into Q&A here in a few moments. But it's hard to believe that it has been a year since we did this conference virtually. Obviously, at that point, we had prepared to comment and update investors on the transformation of GE. But given the news of the day, it was also important for us to talk about COVID-19. Clearly, none of us could have foreseen what the next 12 months would bring us. We certainly felt COVID across our operations, nowhere more so than in aviation. We'll talk about that more in a moment. But I think what we did in the wake of COVID was take decisive action, which served to accelerate the transformation of GE. And I want to give investors an update on that transformation today. Clearly, our news for March relative to our combination of our GECAS, our aircraft leasing business with AerCap, also serves to accelerate that transformation of GE toward a more focused, a simpler, stronger industrial company. I think as we look at GE today, the GE that goes forward, you really have 4 outstanding franchises, what you see on the slide here. These are the businesses that define GE as we think about the value-creation opportunity in front of us. I think a lot of people think of GE as a large-ticket cap goods company. But it's important to know, as you look across these 4 businesses, the services represent nearly half of our revenue and certainly more than half of our earnings and cash flow streams. So there's a lot to work with here, making sure that the planes are in the air, that health care is being delivered as efficiently as possible, let alone helping the world navigate the energy transition. And that's what we do every day in 170 countries around the world. The team is hard at it as we speak, and I'm excited to be here to give everybody that update on where we are. If we go to the next page, Brendan, our purpose at GE is, simply put, building a world that works. And that really applies across the GE portfolio today. We think about the future of flight. That's what GE Aviation has done for decades. Clearly, we have been the supplier of choice because of the reliability and the efficiency that our innovations bring to our flying customers. That continues today, certainly with the LEAP. We see the LEAP cutting emissions by 15%, being part of that track record of innovation. And as the industry wrestles with its commitment to halve carbon emissions by 2050, we think we're going to be well positioned to do that, not only with LEAP, but technologies to come, be that sustainable aviation fuels, hybrids and the like. Precision Healthcare is all about personalized medicine delivered in an integrated and efficient way. And that's really what we do both in our Healthcare Systems and our Pharmaceutical Diagnostics businesses. There's a lot to do there, both organically and inorganically, and we're excited about that. I'll get into that in more depth here in a moment. And then finally, with respect to the energy transition, you would expect GE, a company that generates over 1/3 of the world's energy, to be smack in the middle of that. And that's where our customers want us, and we're happy to serve, be it with respect to wind, both onshore and offshore. Onshore, we've got a leadership position here in the U.S., 2 years running. On offshore, clearly an emerging opportunity for us, both in Europe and in the U.S. But also as we think about the role of gas in the energy transition, we know our gas position complements well, both wind and solar. And certainly, as we move forward, the challenges with the grid will be opportunities for us at GE in our Grid business. And as we think about the energy transition, I think it's important to remember that it's not only about sustainability, right, the so-called trilemma. Sustainability, reliability and affordability, particularly with 1 billion people around the world still without reliable power is an opportunity and a mission that we're quite keen to see through at GE. If I go to the next page and speak about the transformation toward that more focused, that simpler, that stronger high-tech industrial, I think if we look back over the last several years, a lot of progress in that regard. But the AerCap transaction that I mentioned a moment ago really allows us to put all of our energies, let alone our money, on creating full value from these 4 leadership franchises. We announced that deal in March. We're excited to see the AerCap shareholders approve the deal recently. We know the DOJ has concluded its review here in the U.S. So closing later this year, early next year, but that positions us to take down over $70 billion of debt over the last several years, so the deleveraging very much on track in that regard. And again, that allows us to put the balance sheet in good order. So we can really pivot and put all of our energies in running these businesses better. And that's where lean and decentralization fit in. And we'll talk more about the efforts in that regard. But I couldn't be more pleased, particularly here on the heels of our second quarter operating reviews. We've been with all the businesses, Brendan, in the last 5 weeks to see how the team is really accelerating the pace of implementation around lean and really embracing the more decentralized mode of operation here. And then finally, what all of that sets us up to do is simply play more offense. And I know a lot of people think that means M&A. At GE today, first and foremost, that's about organic growth, being better at how we market and sell, how we develop new products, let alone the technologies of tomorrow. And as we have more time and more capital to do that, that clearly sets us up to build off that stronger foundation and over time, complement that with inorganic investments. And all of that sets up, I think, enhanced strategic optionality as we think about GE longer term. So that's really the heart of the transformation. I talked about lean. I know you are a student of lean. From your time at Fortive, you worked with one of the best CEOs that I know, Jim Lico, there. lean at GE today is all about the customer and how do we institutionalize continuous improvement, how do we improve our problem-solving capabilities to serve the customer, to improve safety, quality, delivery, cost and cash with an eye toward building a more sustainable future. And again, the second quarter operating reviews, Brendan, have really been a big motivator for us as we've gotten out and just seen so many examples of lean continuing to build momentum. One out of Aviation, I'll just quickly highlight our Strother aviation services repair facility out in Kansas: 2 sites, 7 miles away, not necessarily our best performers. Team goes in there and says, there's an opportunity. The next thing you know, there are over 90 dumpsters out in the parking lot with a lot of waste being removed, 2 facilities being combined into one. More importantly, for the CF34 that we service there, inventory cut in half, output increased. And I think the team understands the flywheel is turning. Lots of examples across the company, but that's really the key. The flywheel is moving here. It's been a couple of years. And now we want to make sure we accelerate that for impact, not only for customers, but ultimately, investors as well. Decentralization goes hand in hand with lean, again, a model I know you know well, Brendan. I think it's applicable here at GE because a lot of what I saw 2.5 years ago when I joined was an orientation towards the segments, at times more so than the business units. So we've reported 4 segments, no change there. But where we're furthest along is in Power where we really -- we've broken down that segment into [indiscernible] units. And that's the way we manage the bottoms up. Still report on a consolidated basis, but we look at those businesses month in, month out on their own bottoms. I think that's a real reason why you've seen the improvement that we have seen at Gas Power, where they came in a year early relative to their positive cash flow targets. And as we have recently promoted Scott Strazik, the CEO of Gas Power, to be the CEO all of GE Power. That's the operating model I know Scott and his team understand. We're not going back to a consolidated operating model. We're really going to run these 4 businesses where they're going to work together great, but that won't be the default position. And we're seeing that really across the organization. Again, we've been out with everybody. I think we had 2 excellent operating reviews in Renewables last week, with our Onshore Wind and our Grid businesses running that same play, not only as we manage Renewables in that fashion, but as they manage their own businesses in similar fashion. So if you look across nearly 30 units, business units at GE, hopefully, that gives you a little bit of a color as to how we're driving a different approach and, ultimately, better results. Let's go to the next slide. We can talk about these businesses. I'll be brief, Brendan. Clearly, starting with Aviation. This is where the action is for us the next couple of years as we prepare for that return to flight post-COVID. But as I think most people know, we've got a global leadership position in aircraft engines, both commercial and military. 37,000 commercial engines out there in our installed base. Over 60% haven't seen their second shop visit, so there's a lot of opportunity here as these planes are put back in the air. Certainly, we want to continue to innovate, again, from an efficiency, from a reliability, sustainability perspective so we continue to have high win rates that we do with our OEM and our carrier customers. Our military business is a business we're going to manage better going forward. But with 26,000 military engines, opportunities both in fixed and rotorcraft, that's a business that's going to be a part of the long-term growth story and the value-creation story in Aviation and at GE. Clearly, in terms of current trends, I think your audience is probably well aware that we're looking at departures off a '19 base that are down 37%, 38% as of this morning. Reading the overnights, I was very encouraged by the CEO comments at this conference from some of our important customers relative to what they're seeing both over the course of the Memorial Day weekend here in the U.S. and more broadly. Clearly, China and the U.S. are back. Europe, South America, Southeast Asia, lagging. But we know as vaccines roll, we'll see lockdowns diminish. And that will be good both for, I think, domestic and ultimately, international travel. Our views relative to recovery don't change here. We think narrowbodies are back in '23, widebodies in '24. I think that's more or less a consensus view. What we want to do is make sure we're ready for the snapback, not only in [indiscernible] But ultimately, the production levels over the next several years. So there's a lot going on. I think in the short term though, we're still working through COVID. Here in the second quarter, I'd expect our shop visits to more or less be in line sequentially with what we saw in the first quarter. We're working through some contract margin reviews as well. So I think sequentially, we'll see a step-down in margins in the second quarter. But no change relative to a full year outlook here that's really predicated on the second half recovery, which I think we see taking root relative to our ability to grow low single digits in terms of organic growth, put together, low double-digit margins and an improved cash position. So if I move quickly to Healthcare. Brendan, honestly, I think this is a bit of an underappreciated gem within the GE portfolio today. Clearly, a leadership position at the heart of Precision held primarily through our imaging franchises. but I think also increasingly with our Pharmaceutical Diagnostics offering and how the 2 complement, particularly as we think about some of the oncology applications that some of our recent acquisitions help us exploit. We touch over 1 billion patients a year at GE Healthcare. When you look at how the over 4 million strong installed base of our MR, CT, our ultrasound scanners and our patient monitors and the like are used across the global health care scene. Now what is that? 15% of worldwide population. It's a big number. But clearly, plenty of opportunities for us to continue to grow here. And grow we want to do to serve the customers. We know this business is more valuable to investors. And we can get that low single-digit growth rate up sustainably into the mid-single digit range. There's a lot of good commercial execution improvements on the table. Clearly, you see us investing aggressively in innovation, over 40 NPIs last year. And certainly, Digital is going to be a bigger part of what we do here. The NPIs have really taken off, I think, quite nicely thus far this year. One example, our Vscan Air ultrasound product is really a nice portable, lower price point unit that allows whole body scans. I actually had a former student of mine, if you can believe it, who's ironically a doctor write me and said this has really changed the way that they are delivering care in his unit. So we've got all sorts of indicators that the innovations are having the desired impact. And again, in turn, that sets us up on the back of what has been 3 outstanding quarters with respect to cash generation, to tweak that growth rate up, continue to target 25 to 75 basis points of op margin expansion with high cash conversion. So a good story there. But let's talk about the energy transition. We'll start first with Renewables. Again, this is a business where we know we have a critical role to play, both in bringing down the cost of renewable energy and also working to make sure the renewable penetration doesn't have negative knock-on impacts given the technical challenges there. And we think we're well positioned to do that. Onshore Wind, leadership position here in North America, 2 years running. We've recently changed the approach outside of the U.S. to drive better selectivity and better cost and margin performance. Offshore Wind, big opportunity for us here. You've seen the estimates in excess of 20% market growth. Encouraged by the Biden moves. Our Haliade-X has been approved both for the 12- and 13-megawatt applications. We're working on the 14-megawatt opportunity. But we really think this is a $3 billion business for us by 2023, one that can be a margin and a cash contributor. And again, with respect to Grid, this is, I think, an underappreciated dynamic relative to the energy transition. Yes, the physical grid needs to be upgraded. Yes, there's an underpenetration of digital capabilities in the management of the grid today. But renewables don't come online naturally and easily. And particularly, as we approach 40% renewables penetration, the grid needs to be more actively managed. And we think we've got capabilities to be part of that solution. You put that together, there's a lot of execution required to improve the financial performance of this business, but we do think we're in a position to drive better growth here than some expect. But ultimately, it's going to be about the margin and cash performance at Renewables. And then, Brendan, if we just quickly wrap on the businesses at Power. Again, 4 businesses. Gas Power represents a better part, 3/4 of the segment, and that is where we're furthest along. As you would expect, again, given the nature of what we started with a few years back, working with the world's largest installed base of gas turbines, really a twofold story. Again, more selectivity, better underwriting relative to new units, but also making sure that we are managing the day in, day out aspects of our service business more effectively. We were encouraged by the start to the year. Here in the second quarter, I think outages have played out more or less as we would have expected. But it's a different dynamic for us where we just need to execute for our customers better, and we think that will enable us to win more business and drive a modest amount of better growth while we complement that with smarter selectivity in new units. Won't spend a lot of time on the other businesses. Just to remind folks that our Steam business is going through a fairly dramatic reset in so much as we're exiting the newbuild coal space, reconfiguring the European footprint. And we have another -- a number of runoff expenses in that business. So we have a down year in Steam this year. Next year will be a bit of a transition. But I think when we get to the other side, we've got a more pure-play service business, a bit more in line with our Nuclear business, which is 90% services today. So I think all in all, really pleased with gas, another year of improvement in the making here given what we see. And I think in time, you'll see the Power segment contributing, call it, $1 billion or $2 billion of free cash to the overall GE equation. So Brendan, from the earliest days, in my time, at least, with the company, we've talked about an aspiration of being a better, more sustainable cash generator. We know that's been a knock, maybe the question on GE for some time. That aspiration holds today. A lot of investors will ask, "Well, why not raise it?" Well, I appreciate the confidence born of that question, but we're not going to raise it until we do it. And I think for us, the simple math here to get to a high single-digit free cash flow margin is getting back to revenues in line with where we were pre-COVID, call it, $85 billion to $90 billion. And take the middle of that high single-digit range of 8%, you get to $7 billion. To get to $7 billion, a lot of things have to happen. And we can break that down by business maybe a little bit later. But simply put, we need to be a good organic grower. We don't necessarily need to knock the ball out of the park, but we want to be consistent. And we want that growth to be good growth, good margins, good margin expansion and good cash conversion. We think we're going to be able to complement that with less restructuring over time and in turn, less legal, less pension obligations as we work down some of those legacy issues. And our lean efforts certainly put us in a position to require less cash in working capital, less cash in CapEx as we get on that track. It's a simple equation. It's one I know you're familiar with. We need to execute on it. And again, I think we see a lot of momentum that, that is indeed the case. And just one quick example for me that gets me excited. As you know, there's a little bit of noise in the system relative to our policy decision in the wake of the AerCap announcement to stop factoring. We can work through the details there. But operationally, I think what matters most is we're no longer going to hear about the factoring backstop, the factoring parachute. Those are quotes from some of the May operating reviews. And what you see is the organization rapidly tilting toward better daily management of cash, particularly with respect to receivables. And that may sound particularly mundane for folks at a distance, but that's the daily management trick here at GE. It's going to help, I think, change not only how we deliver better cash for investors, but frankly, how do we take better care of our customers on a day-in, day-out basis. So if we just go to the last slide here, I hope folks who haven't been paying attention to the GE story come away a little bit better informed, maybe a little bit more excited. I suspect there's a little bit of news here for those that have been along with us for the last couple of years. But again, I think the transformation is underway. We know what we want to do. It is a more focused, it is a simpler, it is that stronger, high-tech industrial GE that we know we can be. We still have a lot to do. So I can be excited about the momentum I saw across the businesses here over the last 5 weeks, but we know there's a lot more to do, and we're anxious to do that. A lot of those meetings in May, Brendan, were in person. And that's a far better way to operate. With due respect to our setup here this morning, the hallway conversations, the body language, all of that. The technology got us through the last year, but I think we're keen to get back at it here in the second half and be in the same room and do better work together as a team. And over time, I think we are going to create a lot of value and have that resonate both with customers and with investors. So with that, we'll throw it back to you.

Wonderful. So outstanding overview. And really a pretty remarkable transformation over the last 2, 3 years here.

I guess first question on that topic. Clearly, pretty big shift. You've been very transparent about the decentralization, driving lean principles, organic growth, good growth, profitable growth. I'm curious about the cultural transition. How is that setting in? How has that played out across your senior team? And where do you think we are in that journey?

Well, we didn't talk much about culture, right? But when we talk about the team, that's really the talent and the structure of how we come to work every day and ultimately, the culture. Brendan, you know what a lean culture looks like. I've just long been in the view. You don't wake up one day, come to the table and say, "I want our culture to go from X to Y," right? You change culture, in my view, by changing the way we work. And that's really what the lean effort has been about, right? It's about the customer. What does the customer want? How does the customer measure our performance? Not how we see ourselves. How do we go about driving continuous improvement? You first have to recognize that you can be better, right, rather than pound your chest thinking that you're the best thing ever. But you need to do that systematically. You need to do that methodically. And that's where the problem-solving work that we do is so important. But again, that's not just an approach that you can bring in a consultant to drive, and you had a front-row seat to this, right? You need to lead a lean transformation from the front. It's got to be hands on. Nothing is too small to matter, right? Days count. Hours count. The details matter. And ultimately, managing that way at Gemba, at the place where the real work is done, redefines the leadership model. A year ago, we rolled out -- I mean, this is what, 18 months in to the lean work a declaration of our leadership behaviors. We talked a lot about focus, humility, transparency. Maybe some of those words are not words folks would associate with GE. But given our ambition and our capabilities, while we might be able to do almost anything, it doesn't mean we should try. We need to focus. Likewise, humility. A lot to be proud of at GE, but we can always be better. And transparency means simply putting the good and the bad on the table, right, in equal measure. Let's celebrate and learn from what's working, but let's also get after that, which is not. By changing the way we work in that fashion, I think a lot of people here at GE have gotten excited about what's possible. Some folks have been here for a while, say, "Well, we used to do that. We used to do some of that." Well, I'm not focused on where we were. I'm very focused on where we are today, where we're headed tomorrow. And I do think that as the lean flywheel turns, you're going to see the culture continue to evolve. We certainly have brought in a number of new leaders as well to complement the GE team that helps accelerate that sort of change. But I think all in all, where are we? It's still probably just in the third inning, Brendan, relative to what I see. But again, I take a lot of excitement and encouragement from what I've seen just being back on the road the last 5 weeks in our second quarter reviews.

Excellent. I'd like to pivot a little bit and just sort of talk about the businesses. A few quick questions.

Sure.

First off, Renewables, I mean, obviously, the big growth story, one of the big growth stories at GE. But profitability is sort of hovering around zero over the last couple of years. And the lion's share of revenues are sitting in equipment, not aftermarket services. How quickly do you see that mix shifting as the business ramps? How big do you think that opportunity is? And how defensible do you think those aftermarket revenues are relative to other pieces of the business?

Right. Brendan, there's a lot, a lot there. Let me try to unpack some of that. I think we have been consistent relative to the profitability and the cash challenges in Renewables. I think you need to break it down right in Onshore Wind. I think we've got an enviable position, particularly here in North America. But a combination of issues has had us underperforming internationally. As we go forward here, better selectivity as to those sorts of projects that we pursue, both in terms of certain geographies and frankly, scope, how we go about cost from product platforming upfront to procurement later on in the life cycle is going to help us here. And a number of the organizational moves that we are in the process of implementing, I think, will help us in that regard. So I think what we will see is better performance in Offshore Wind as the international side of things picks up the pace. We know Offshore Wind has been simply an investment. There were some people who suggested when I joined 2.5 years ago, "Kill it." It's just we don't have the money. It's not going to be that big of an opportunity. And now, what are we talking about? 200 gigawatts of potential, clearly an ambitious target just here in the U.S. by the Biden administration and a lot of opportunity. We have now, what, a 6, almost a 6-gigawatt pipeline ourselves on the back of what we're doing, particularly with the Haliade-X. I mentioned some of the approvals that we have and that are pending there. We will get that business profitable as we get into a meaningful revenue stream. And then it's really all about the turnaround in grid, frankly. Again, a business that we acquired a host of issues, but given what I saw just last week, that will be a profitable business for us and it should be. We run it well, again, given the wealth of opportunities we have vis-à-vis the grid in the energy transition. Services cuts across all of that. Brendan, I don't think you'll see services and Renewables approach the greater than 50% of revenues that I think some will have noticed in the slides that we enjoy in Aviation and that we enjoy in Power, in part because the installed base is growing, quite rapidly, right at 7%, 8% annually. But also, there are a number of structural dynamics there. But that said, between the way we will ultimately help modernize the installed base out there as well as apply more digital capability to the service work that we can do, I think you will see that service penetration, which is roughly 20% today in the segment increase. But I don't think it's going to be approaching half of that segment anytime soon.

Okay. That's very useful. And shifting gears a little bit, Aviation. So to sort of look at the shape of the recovery, we haven't seen much by way of retirements. Have you've seen any uptick here or any other indication that we might be looking at a structural shift towards less air travel overall?

Well, we really have not seen an uptick, Brendan, relative to retirements. I think there's certainly a number of structural dynamics that are still going to play out. We're still seeing a number of moving pieces here in the second quarter ourselves. I think the industry is going to need a couple more years for everything to settle out for whatever the post-COVID world would look like. But again, I just take a lot of encouragement from what I saw in some of the comments overnight, our friends in American, our friends at Delta talking about a nice spring back here in leisure travel. I think optimism relative to business travel. And we know the positive effect of vaccines have had here, certainly in China. And I think we're going to see that, hopefully, later this year in Europe and points elsewhere. Not to diminish the tragedy that clearly is still underway in places like India. And that's just beyond sad. But I don't think there's a structural change. And maybe I'm a bit of an outlier here, Brendan. Maybe I'm a bit old school. But again, I know I saw things on the factory floor in Lynn and in Durham on these recent travels that I would have never seen through teams. And we're a big teams house here at GE, happily so, right? The hallway conversations, the questions I could ask. The questions I got aren't going to happen with 20 people on a call like this, and let alone the body language. We hired a lot of people during COVID. And to get them out of their guest bedrooms, right, and get them into the room, it's just a better dynamic. Now we'll have to work through our -- getting everybody back to the offices. But if that is any indication of the reality that awaits us, well, there'll still be, I suspect, some change. I think the aviation industry is poised to get back on a long-term growth trajectory.

Right. Nothing like it in the Gemba. Any reaction to the Airbus announcement last week? Does that -- how does that square with your view of the recovery?

Well, we obviously always pay attention when Guillaume or Dave are talking about where they're taking their companies. We're honored to be under wing both at Airbus and at Boeing and work very closely with each OEM to make sure that as they think about not only production rate expansion from here, but also new platforms, that we're well positioned to help them where we can. So I'll let Guillaume and Dave talk to production levels. But rest assured that we're very keen to be of service and support them as the industry recovers.

Right. And then one last question around the recovery trajectory in Aviation. How should we be thinking about structural cost as demand rebounds? And sort of what gives you confidence that, that cost out is going to be sort of beyond normal productivity gains, particularly in a supply chain where pretty much everybody is trying to extract savings?

Right. Right. Well, Brendan, the way I think about margins at Aviation, you have a host of cross-currency. You talked about retirements, the knock-on effect relative to USM, cost out on our book, right, $1 billion last year, $500 million this year. Some of that's going to come back, no question as, again, as shop visits increase, hopefully sequentially and hopefully soon and as we get back to an upward trajectory on new unit production. But I think given the structural moves that we know we made and the opportunity to accelerate lean, if I was to force rank where we are with respect to lean across the 4 businesses, Aviation is probably not in the first half of that list. Take the Strother example. Again, I think there's just all sorts of opportunities along those lines to continue to take cost out as the industry recovers. And that's why I think we have the confidence we can get back to that high-teens 20% op margin level as volumes recover in Aviation.

Okay. Very good. Just pivoting to Healthcare here quickly. Around the shape of the recovery, do you foresee any sort of longer [indiscernible] particularly around the financial strain in U.S. hospitals, maybe accelerated consolidation? We've seen a lot of critical access rural facilities kind of on the ropes over the last 1.5 years here.

Well, I don't think I've ever been asked that question, Brendan, relative to rural health. I think that is a real issue here in the U.S. in the wake of COVID. But fortunately, it's been a priority in some of the stimulus work that the Biden administration has crafted. I think they understand well that, that's an important part of overall health care delivery in the U.S. But I think we're very encouraged, frankly, about the future of health care from here. Clearly, some bumps. We saw it in our business. We were not alone. Even some of our biggest customers are now just getting back to pre-COVID levels. But I think that between what we know we can do a better job of commercially, what we can deliver in terms of innovation, COVID has also, I think, put a particular focus on more integrated and more digital capabilities, right? Just our command center and what our command center capabilities have been able to do with respect to managing patient overload, telemedicine and the like, I think is particularly exciting for us. A little bit more pressure in private markets in the wake of COVID. That's coming back. But I think COVID has also stirred the souls of governments around the world relative to health care modernization. I think we stand to contribute and benefit from that. So again, I think all in all, we should be able to increase the rate of growth in Healthcare. That's largely an execution story. I think the market backdrop will be there. And that will be profitable, good cash-generating growth with high impact in the clinic.