B
#I think two primary end markets that we saw softening with NGP.
One being China, and it's enjoyed great success there over the last few years in terms of expansion.
So we saw that contracting somewhat in the quarter ---+ over the course of the quarter.
And the other area that we saw softening was in North America.
Europe also was not that it was unaffected, but not as significant as we saw in China and North America.
I think that we're remaining optimistic that the worst of any destocking is behind us.
We are talking and in close communication with the distributors.
And they are clearly sizing their inventories to what they believe the go-forward demand is.
And they are indicating that they feel comfortable with where they are after adjusting to in Q3, but are going to keep a cautious eye towards any feedback from the market as they move forward.
As you know, we don't provide margin at that level, but of course, they would be down, and we are seeing that, given the softness on the top line.
But as <UNK> mentioned earlier, the commentary around cost management and just managing headcount as we go through this period of reduction, that continued to be able to continue to preserve margins.
But yes, we are seeing the impact on the operating margin line for OEM.
Good morning.
Good morning, <UNK>.
Engineered components was down low-single digits.
General industrial and auto, I think two combined.
Right.
If you think about our plastic molding solutions, as we refer to it now, they are continuing to enjoy very strong demand for the products on the medical market side of the equation.
On the automotive side, North America continues to do very well, and that new product introductions continue on the North American side.
And then overall macroeconomic conditions in China have seen a slowdown.
We continue to grow but at a decelerating rate.
No, different platforms.
One thing that I want to mention relative to the performance of the OEM side of the Business in Aerospace, the team there done a magnificent job in terms of the complexity of components that we work on, and how they have brought them to final completion.
The programs at hand are a combination Airbus A350, the LEAP, and B2 military programs.
These particular programs constitute probably what are some of the more complex components in our history.
And the teams have just done an outstanding job in terms of overcoming some of the challenges.
That said, unfortunately they didn't get to where they had planned on until late in the quarter, and that, coupled with the necessary customer approvals on these complex parts, had them slip out of the quarter.
We're not quite there yet.
I think that there's going to be challenges for the next couple of quarters as we continue to work on them.
We are perfecting them part by part, so there is visible improvements, visible efficiencies being gained on a part-by-part basis, but there are a range of different components, some of which are further along than others.
So it's a mixed bag, and I think it's fair to say that we have work to do still in the coming quarters.
The way we think about it entering into service is more into early 2016, <UNK>.
And so as we ---+ as it enters into service, then our standard practice is that we will continue to provide content for platform on the aircraft as it enters into service.
I think what we are seeing relative to the quarter, I wouldn't read anything into that in terms of the overall outlook for Aerospace as an industry or relative to the cycle.
I think what we saw were just [heating] problems as we continue to bring what are very complex parts to final readiness for shipment to the customer.
As we look forward into the cycle, I think what you have is a number of moving parts where the demand against the narrow body remains robust.
The question will be: Will it expand in terms of production rates that have been discussed.
And that, I think, will be tempered as time goes on to where the OE ---+ the Airbus and Boeing will both adjust accordingly to what the economy or the overall cycle does, yet I think it will remain at healthy levels.
First, I just clarified mid-teens is the guidance we're giving against Industrial.
And as we move into ---+
(Laughter) We can debate that, but let's take the mid-point and go plus or minus 1.
How is that.
The team has just met over the last few days on the Industrial side and had a fabulous working session.
Feedback from it is that the team remains ---+ is confident in the full-year outlook.
Clearly, there are some unknowns that may come at us from an overall macroeconomic perspective.
But that said, the team remains confident in the full-year outlook, and that's as I just communicated.
I am confident in Barnes Group and the ---+ clearly how we're positioning the Business for the long term.
As we continue to execute the strategy to change the portfolio towards engineered products and industrial technologies, and you see that already translating into our results to where, as we hit these headwinds from the economy, clearly for us we are ---+ we're weathering them this year far better than we ever would have in the past.
So as I think about 2016 in general, I think of it as a low-growth environment continuing to grow but in the low digits.
Bingo.
Yes.
Thank you.
Thanks, Ed.
