Teledyne Technologies (TDY) 24 Jan 242023 Q4 Earnings call transcript

Ladies and gentlemen, good morning, thank you for standing by. Welcome to the Teledyne Fourth Quarter Earnings Call. [Operator Instructions].

As a reminder, today's conference is being recorded.

At this time, it's my pleasure to turn the conference over to our host, Mr. VanWees. Jason ahead. go Please

We thanks, like is Teledyne's to year conference and and morning. earlier Chairman. Fourth VanWees, I full call. release earnings would welcome XXXX our everyone. Tom, earnings Jason this This Vice Quarter released Thanks, everyone to

management are George familiar Counsel, Bob, Blackwood, President CFO, CEO, me Senior new we today Mehrabian and our President and for Secretary. Robert, Officer will by and Steve Cibik, Compliance General Executive Vice Chief Teledyne's Joining Edwin EVP also Robert Roks, Chairman, questions. and remarks but ask team, COO; and your George Melanie and and After Edwin, Steve,

subject we materially. that filings. risks and to Of before get differ course, the you Tony's caveats as to all noted have so release SEC made reminded periodic results in and statements our actual may tell are various me forward-looking earnings And assumptions, started, morning course, of this

disclosures, order being selective In available is a will X dial-in, webcast for avoid and [indiscernible] be approximately simultaneously month. webcast to and via potential this call replay,

Here is Robert.

good industrial share. and Jason, sales performance and the achieved GAAP due automation record able which were and to medical instrumentation our earnings primarily more the of fourth in and laboratory to quarter, morning, In you, than thank announced we all-time joining you previously compensate and non-GAAP and earnings Marine Sales our Thank increased call. per for aerospace headwind businesses, for market. the the

sheet X.X% in Defense balance remains Leverage particularly in and strong exceeded our businesses. orders were sales to our further record every business healthy. Overall, but segment Furthermore, declined Marine and

the complementary Zeno businesses, we fourth in of Finally, acquisition quarter. Networks to as shown the acquire by continue

year quarter XX Compared and margin points, basis non-GAAP last increased with respectively. fourth operating year, XX and full

especially longer-cycle most in uncertain noting encouraging, in the Our macro the Nevertheless, today. worth of businesses. was was our in global backlog-driven that it's environment in increase orders broad-based strength orders

little time. will take the to orders a converting So sales

of earnings recent terms quarterly a XXXX sales and than In think in therefore, years. be the will greater ramp outlook, we, bit

we believe that typically or sales $X.X see of with slightly So quarter about under annual growth billion while XXXX year. seasonally last first be will roughly low X%, flat we

Edwin turn on further will the the X call performance our I who over business to will and of George, now comment segments.

for Thank of Robert. Teledyne's on of portfolio. I Edwin businesses This including components care, and Digital segment, infrared segment is as cycle defense, this longer-cycle you, which such navigation. Teledyne inspection from a and factory shorter like condition the and XX% a monitoring will with mix and whole, and health application combined And is Imaging cameras space is as automation, ranging semiconductor report markets, industrial maritime

year. and sales of Systems, sales tough year-over-year Fourth imaging were MEMS. industrial and Fourth quarter significant systems but compared sales XXXX infrared year-over-year a systems imaging products, growth in and decline at quarter FLIR or in comparison. greatest X-ray space-based to Double-digit of Micro in of the Electro to declined level due Mechanical unmanned was a each surveillance slightly lower systems offset detectors sales XXXX last

contributors quarter row, segment business FLIR second positive a in overall fleet the were For the to collective margin.

In sales at level quarterly years. and highest in last the year-over-year addition, were FLIR the X increased

of report which represent X the on will the XX% now will other George segments, remaining Teledyne.

XX% Thanks, which of businesses, Marine, Evan. a segment and The contributed instrumentation environmental our measurement of and test consists sales. over little

continued but Sales sales defense increased last offshore due increased primarily X.X% marine overall and the ocean growth quarter, markets. year. in sales, of XX.X% also versus to energy total science global in fourth For quarter segment, strong instruments the

year-over-year. protocol and and include Sales systems, of analyzers electronic which flat test measurement digitizers oscilloscopes, were

of of electronic sales incremental oscilloscopes of sales continued this But was small the applications. by see softness storage continue some and sales largely acquisition. amount offset center in to from analyzers strong We for and Zeno data a

instruments offset and than of quality lower analyzers gas Sales and more drug flame sales X.X% with of safety air environmental instruments. and by of sales discovery greater decreased and laboratory

Overall, fourth basis GAAP with Instrumentation basis margin XX.X%, points increased XXX to the records and increasing for non-GAAP XXX XX% to segment segments. quarter, both points over operating in on profit basis the operating a all-time XX.X%,

growth Electronics the driven sales aerospace represents In X.X%, Aerospace sales, Defense increased and products. XX% segment, of primarily Teledyne which Fourth quarter commercial by of

segment to segment non-GAAP primarily approximately tough due year's profit all-time and GAAP with a year-over-year decreased record X% last margin. comparison operating

contributes X.X%. For operating fourth X% the sales, revenue quarter basis which profit points. But to overall with up XXX Engineered Systems decreased increased segment, margin

to now Robert. call will pass I the back

performance were in we are automation at certain conclusion, our the we'll electronic And while In more will acquiring . When we on markets businesses like record same instrumentation, favorable focus cutting industrial costs or integrating time, businesses check with to In challenged. George. handsomely. the margins benefit protecting pleased our measurement laboratory those and XXXX. growth which structure with businesses. you, and be markets in in and Thank continue recover, near term, we keep complementary cost will test in

in generate and if will are cash in we've some of potentially complete the our larger record done global or do macroeconomic flow past, what we But acquisitions. XXXX, there base shocks and execute well,

I will the to call Steve. now turn over

first full by quarter will Thank will discuss covered and outlook. you, XXXX good quarter and year Robert, some and I the Robert, morning. additional discuss not for then first our I financials

additional that $XXX flow million defer from fourth from operating capital quarter and $XXX.X third the were the less allowed since second in XXXX. quarter disaster was operating the expenditures million flow, $XXX.X cash cash IRS with to relief. made million the activities in activities quarter, quarter fourth due we was to $XXX.X compared of XXXX, million XXXX. Cash $XXX.X from in million flow which declined of is with of tax cash payments, XXXX in Free In compared fourth we

XXXX. $XX.X catch-up quarterly been Capital million compared these in quarter all-time tax and flow have were million Without fourth $XX.X in an payments, XXXX expenditures record. at cash the of with

of quarter with of for the million. ended billion XXXX. amortization $X.XX approximately $X.XX debt. was million is debt less That $XX.X $XX.X cash approximately and of XXXX, quarter of in expense with net Depreciation We the billion $XX.X fourth million compared

to that turning Management the to in $X.XX GAAP of be outlook. XXXX per of non-GAAP believes quarter and our per share the $X.XX will $X.XX range of first with $X.XX to currently range share. in earnings in the earnings Now

And expected $XX.XX for rate, year the items, And tax full XXXX year of $XX.XX. full $XX.XX XXXX, earnings $XX.XX. our outlook be GAAP is basis, share The discrete XX.X%. estimated a excluding is to to non-GAAP per on to

to pass now will the call I Robert. back

like to answers, and Thank Steve. now ready to you, take with would please the questions. proceed questions ahead. if . you're We Tom, your go

question begin We'll Jim Company. & Instructions] with Ricchiuti Needham representing from a [Operator today

more cycle I are making lab dig into And latter little with the it particularly to could the recovery weaker, of see machine see we that a the like bit if have year QX unfolding, industrial in the shorter wanted business to year, you of respect the more assumptions part instrumentation vision the full guess, little and year, about you the the been in automation, guidance, bit some a the of like the balance the some of areas as area. year think I seasonality. sounds you way

an up next $XX.XX, to about XX in that year. those Alright. of as the a Yes. We the year is we've linear this revenue we which in average half also in in will margin will of We're uptick happen and outlined and businesses year now think have basis earnings ramp the another of to increase earnings X% improvement reflect sales almost right about that what XX year would expecting with throughout from to second points.

we're yes, that. anticipating So

On the other hand, cost we're our structure also necessary, if and more. adjusting do we'll

healthy. remain that earnings So our

to margin improvement business I'm respect directionally? about how we some margins should just wondering the major by you're the With think anticipating that of units

lower instruments, already improvement maybe have there. are XX A segment. healthy little we in in very We basis Sure. every Jim, margins expecting margin points.

think basis And In Defense, we'll in about the On XX XX basis basis and XX points. engineered XX points. other hand, Imaging, Aerospace have around points. systems to Digital we

what in this overall, basis improvement. So was we achieved In over overall, Jim, basis about company XX Which XX of last between similar to for And it's the we anticipate and segment, way, XX points year. basis a points year. XX kind points. the about margin

the line we'll of Konrad Greg Jefferies. to Next, go with

last up for talk a around about the cycle book the XXXX? or the growth bail, Maybe for maybe you and question, between assumptions from given Can segment just in X% revenue year. the growth the to on commentary follow side, short but to basis with long

would be Yes, just would T&M have. to environmental year a grow backlog, -- X%, From different Greg, about think The let X% we're first background me instrumentation, this and to difference I'll would first. perspective, Digital And then whereas give segment you will hold. the try that with healthy the as X.X% the businesses to marine instrumentation, year. we X.X%, basically the mentioned, back a Imaging going between with grow about there's We last over George segment answer and expecting under businesses question.

Going Digital about at We of all about Imaging. above up, increase about expect and overall this Engineered believe that time. an average sales Defense, would you X%. add the Aerospace And be of X%. that X%. when to Systems, we X%

more. of dig the then the the imaging any space just kind helpful. is some for call or the seen level in commentary I way And release growth product there maybe and a to if mean in around other versus was little on care parts can lines But just you've set the into portfolio? bit we declines maybe put in of behind XXXX QX numbers health digital in

Sure.

QX. please, and basically go to increased health care, Defense, nice really and the with XX.X% In This vision others. Revenue about then we XX%. our X%. in start Aerospace and QX, to weakness scientific had increased about me In systems. I'll of Let offset industrial some it

have detection about to FLIR XX.X%, in The of revenue and defense Overall, growth businesses, some X.X%. system, our products about go really increased FLIR you side, if our we flip robust our in surveillance over QX,

modest FLIR. make to distinction between would the eXv a growth We eXv by about that forward, in going think offset Now DALSA DALSA about have future. X.X% and a X%, I'll FLIR. of little

that experiencing we order of to the intake clear -- earlier, As the imaging. is the defense really rest mentioned expect good there growth and especially, exceed of

can but that's you give summary I basically of detail, a more So it.

the go of Epstein Bank America. We'll line Ron with of to .

the guys This the the wins of defense guys that on is in CR? you about Ron. backlog how the are for I so to you growth seeing, are Lines risk ask, Jordan for thinking wanted

CR at Obviously, Sure. is have now an orders really The looking we're we considering looking only we're way it us. at not house. for occurrence in orders. is We're that unpleasant future right the Well, always

These has tested. book-to-bill coming And we which healthy. are been So are products new have out, frankly, some exciting programs. being longer-term now

is which is good really We've run Hornet a getting X if over our we our a example, had past Black Hornet nano introduced at drones. X, X X, which Black Hornet, Black the you already years. For -- Black Hornet X, traction. look

have some also space well programs We in true sales our agency, tracking that domain tranche as are in layer as development really nice international healthy.

pleasant some now, would the which in had many in be is We've So in years. CR at looking healthy. while what have it a backlog, thing done experience. CRs we to not Right in past. ways, our We've we're

on then driving being that cited And systems change? it. just that related guys that for Or Is to you Systems Got lower -- was the sunsetting as programs? DI. Unmanned Air what

rather basically, think comps tough drone think than real our I healthy. declines. businesses We are it's

We in some flame or which are our businesses very anti-drone which we're healthy. have Europe, detection also that systems, selling

of it's about drone our we very a businesses. matter tough I good than think feel just comps. Other that, So

from the of Giordano A with line question . Joe Pan

you doing? are How there. enough Close

Joe. . Good, Good

free on Can flow. start you -- I'll cash

the I than you think working you up you little the and in thought year. how end capital that a that day, Can 'XX the came year? lighter talk how full for think shapes for the probably at looks about of

in had little -- trying managed always for suffering side we inventory. really to did Yes, you're the from to perspective, flip cash came R&D. lighter, not third we . The especially our our our capital quarter, some in most also progress in quarter, like a we're not -- fourth working reduce we improvement from able right. good and It companies made get significant is, being the in but our some

$XX us affected million. that million million but maybe say $XX I'd So to or $XX

at $XXX Our debt down it, paid nevertheless, XXXX. looked of we in you if cash, million

debt-to-EBITDA ratio debt-to-EBITDA Our is ratio net X.X. about --

better to should little has We'd So program fast a we R&D headwind. conversion, would recognizing a though XXXX in there to did passed. let the XXXX. We in XXX% Congress forward going that do than always this that the is have we that me to XXXX. everybody be Even be we'll believe like think agreed in R&D

I think in nothing Congress. passing is this

assuming So that. we're don't not -- we're we get

will hit us million we from be acquisition. Nevertheless, X.X, think closer to If good which small in a $XXX think then really go which midsized and $X -- down X.X we is we to X.X to billion. we between to which make able million, puts our position to debt-to-EBITDA will those both should somewhere $XXX be numbers, and ratio

one, for vision? 'XX, did the That's want like really of but year-on-year? And the industrial to margins? helpful like color. down full maybe if we've a talked -- can My frame And what last do lot, I about to full scientific year the much kind for how then you that and how year was of margins did look just FLIR the

Okay.

Let me to Industrial say in about just year-over-year, and down QX pick part. that. going declines X% the I'm scientific we're first than larger vision,

actually XXXX in the improved XX.X% to FLIR which very XX.X% margins, was In year-over-year. in of margins XXXX, terms from significantly went It healthy.

. overall flat. hold to able a margins relatively in we As Digital Imaging were consequence, the

margins correct? expect inherent in FLIR margin commentary? expand 'XX, Just in that you'd . to And again

margin We it expect increase you . Imaging basis a Digital that margins if as have at to XX But look Yes. between whole think is would in segment, XXXX. some and segment expansion. XXX points our somewhere FLIR we

Next, the Morgan line Stanley. of Kristine to let's Liwag, go representing

much before see takeout this And on higher ultimately, price have cost is how expect could about you on in from How you points talking at additional there is cost? from facility And expansion margin this XX talked if Digital the Robert, could year for you that consolidation integration? you're this consolidation some basis of segment. margins that last floor year? also And Imaging. the do we to better about of much year,

leased Yes, moving me to process, we're is terms this we're We space of if spaces. the are can do see Kristine, in for owned of What example, -- properly. now spaces let I in we consolidation. getting and doing out

and For us we're of we space in help example, an a in effective be March. space $XXX,XXX. will that getting in say out there, should Massachusetts, have of $XXX,XXX, Bevrica, $XXX,XXX, That lease something own

consolidation of more the The be helpful. issue helpful. It's have and place is we that in that year. growth this overall the should lower whole we have costs businesses our put that

our So about we've especially structure, or lower cost he at getting achieved when growth, maintaining that from is longer-cycle margin some Edwin thinks looking which really businesses. and improvement, a talks about

lower So it's trumping a combination growth consolidation. and of say, those. I just would cost space

of rebound you're looking at? are color. And watching this the about in and What the to second of the are Great automation year. following instrumentation . terms talked for laboratory out metrics indicators a you industrial markets, that end for you half you've -- What market?

We're semi for programs, For is the industrial for automation, we instrumentation, really businesses, laboratory declines it's in is we seeing much which the have a now, Mechanical Systems don't combination improvement recovery. example, now, projections smartphones kind pickup other in improved market in which these things. Micro seeing, seen our also some our frankly, MEMS visibility, Electro markets, especially market of semi some We'll haven't affects as consumer-related before. of

We -- lot. quality the on of So part have healthy. very our a which businesses, them side is environmental there's should that's we're come is which those a But water back. we think air which flip quality, counting of not been think monitoring, a

combination We in think our -- have a business. and will we instrumentation help of those that part us nice backlog of X the

of last question I your the Zeno And But larger the And you've XXXX sizable mean, attractive? position valuations shaping starting in deals? recently terms more me. is are flexibility leverage to acquisition. for pursue look you gives pipeline I to closed up? more current how mean, deals,

out our on as competitors consider. are would paid we down I you, some We've yet of that looked kind what at of for larger Yes. of prices much the not as tell to we would deals range ones, have large have the those have our valuations of like. come

we side, available, opportunities bolt-on are On the will smaller and flip pearls, some be we acquisitions, see in we what single those. call which pursuing

in now, can are at we we our history, still our And 'XX, looked integrate. are of because are improve acquisitions to the you fit If patient the a as of be prices We little go. pearls to larger easiest them right over can pretty have their more 'XX The 'XX. margins 'XX, we they deals, high. and string

Here's a BNP. Buscaglia, Andrew question from with

Digital Imaging margin.

you're So like sounds -- ask so I start whole. to to going wanted on a QX in

do First marks there? from of a bottom expect sort digital improve you that down to segment that margins, year-over-year effectively is imaging those start off as and for sales

answer The No. is I expect Imaging no. Digital go don't margins down. to

that then think year. should a in up I go bit the little up the rest and of QX pick

a the and -- mentioned points. Imaging We'd XX basis should think Digital number. I as higher have this improvement more towards we margin As basis points before, in Andrew, somewhere prejudice XXX probably 'XX, whole between

think don't helps done that margin back some the because I of our we take there enjoy up, margins. suffer we -- we've our then expecting come no, And when nevertheless, markets markets And we're before, out. soften the But really to as maintain cost improvement.

don't down. go I no, think So going to digital imaging is

And up you or mean up year-over-year sequentially?

first, year-over-year think to it's points. XXX basis to between I Well, XX going

it would expect there's I improvement. things and . will I be think down. don't think happen is if sequentially go what sequential -- I -- to

Yes.

then And sort on the your wondering year [indiscernible] you incremental broke book-to-bill then legacy defense Teledyne of you book-to-bill. versus potential awards have in progresses? Okay. as quarters, that? view And past out Do

Sure.

legacy QX environmental ways. good. was and primarily some look healthy, Which marine, by was you is which instrumentation, very book-to-bill in and is really Teledyne which is If in at X.XX measurement. test Marine, driven all which The

big just was That's was -- X. question And precisely, acquisition, obviously, And X. Aerospace we FLIR, was you then Systems was I'm or Defense, paradigm. Imaging, X. and our your FLIR, if Engineered over look answering over closer over X.X. which it historical just excluding it Digital just just is it at to

look more was Teledyne closer it's all, Plus FLIR, our historical QX, if to our in whether Teledyne over at X.XX%. book-to-bill you or all So

on a awards Is there year. feeling then tracking? a lot still incremental on And question Okay. throughout defense you're you're the

yes. answer The Yes. is

have pretty read good We a what's coming. on

Black the new we products. that X. last have space feel We the week or that. I Tranche have them. of mentioned mentioned gotten we to some Hornet good And The are all up primes . awards their I X. in about

Instructions]And with [Operator of the Poponak let's line go Goldman Sachs. Noah to

Robert, organic assuming Is full correct? framework revenue X% growth. year . full year XXXX your that is

about Yes, X%.

first you dollars can revenue you organic about repeat top what And or revenue the line said growth? just quarter

Yes.

be I'm I seeing. think And the our a going to quarter. we're that businesses under, be above short-cycle little it'd because lowest that X.X that's of or if saying

on that we our recover flat -- be QX -- terms not businesses. up. But should year-over-year orders then have businesses long-cycle pick in in short-cycle We revenue and much we're so assuming will and it of

Got it.

Okay.

now are Or up? Just Or but pick those am. orders concrete guess I of in mean then for and kind of to I of have compares. easier I been the -- you sort know yes, I short short-cycle up? just but on have actually an making you seen everything know you pick also And I evidence a clear, has that assumption it based I And about cycle, you'll just asked when but wasn't guess businesses, this discussed, will business?

but with That's better we're We at talking look level, that But we're that at customers, see our very have good. that necessarily we inventory this And our down. we they're inventories time. sharing pipeline, looking going are that as us. at orders to say

that's about that. easier cycle, already a of have because course, orders. the feel we understand consequence, start good that the you we much we orders, will long getting As and expect we

semi of of will thing we in in do the other already terms is we the the about We'd as cycle generator some thinking seeing test that what well and But -- pick So we're at flame expected the maritime and trends pickup that what's talking number be measurement that businesses. short up. industry look MEMS quarters. past are happened in on what eventually our in as environmental in are And infrared people the also projecting. people

some businesses ours. customers in well So that's of lowering certain pickup unique some inventories what's for of encouraging. We see as our as

something organic that I sense, the said makes the and the that's X% to embedded cycle range? year, what EPS EPS some in the That the of that get of go for are margins, think Okay. above the I pretty EPS do Is safe lack I If most it your visibility then the to relative segment I and with to and straightforward. you've between short just conservatism things assume helpful. degree you guidance. of in

Yes.

than a better You conservative. I said We're always it little could.

that one our mention. -- at The there's we look I other When other And segment, we should in increases look per at margins. thing se. segment

be to higher which insurance cognizant portion. going reflect new going of that and seeing in pay to And now medical or to Edwin their corporate is We are be their the the George premiums. costs little is and fact have the we're also a management,

That's going margins margins look we're corporate, much are why expect to XX go the -- the increasing up. would we in basis to So XX corporate while assuming be points. the higher, segment about they're

some one, what the it's active optimistic commentary of Last like maybe and pipeline and a pretty you're you've things pretty you is pretty see. M&A tougher. makes Other a spread your said bid-ask there's sound about suggests little it full and

finer guess, a on terms I we to this likely in can of are you it deals see put So year? how point

Yes.

may answering Let was say the X that I because the me have time. same at just questions reason confusion

leverage and this year. it because going part -- is down acquisitions we down The first faster was go ratio our obviously larger

acquisitions People going are larger to. that paying at right now are The pretty expensive. that prices we we are not look

other the available, acquisitions make this hand, some On year. smaller expect and to we are

been larger and I have but -- smaller So year. think we acquisitions like will we always for we'd some the this patient make ones be

a So we line. product reasonable have

Jamieson Next with is Robert the UBS. question from

Very helpful.

kind smaller for like another points A&D of XX growth, expansion. electronics. basis margin expected and year one next one of Just to XX Strong on

commercial margin bit and like there, aerospace should if next then MRO? is And new the about think how we within curious maybe and on then year? puts growth little a Just about between you're thinking the how split pressured MRO builds takes

the aftermarket. kinds. significant base of A first. aerospace Because of aerospace very in large with various embedded is we a stay our Let's aircraft amount revenue in have in

be helpful that to for we us. very think So going is

And in issues us we that. think the XXX, builds also with going product of going line -- have that's obviously, that's into current on. a so We we regardless to are help and

seeing the and we it X% modernization, in we to us. be defense improvement, believe balance X% side, will both to X%. we X% are stockpile, to good some replacement. think those in would be And of programs a perhaps On aerospace obviously, defense in helpful domain. each in And

great. random That's more kind -- talked of And just then a is a bit capital this question, but of little allocation. we about

got to full You to seen you be over years. we've I do interest some look stock? several the funnel, going buying acquisitions. smaller have But for a this know probably what back deviation Absent anything large, would and would last a in any

be And like stock? it maybe ever thought that kind tighten bid-ask make one you back little spread? easier or would consider a trade you maybe could given split questions a buy easier like other would it And to guess then the ever of make bit to for random stock float, the to I that

that's don't pain start the no. cause And of kind me -- investors our reason XX-plus institutional our investors. a say a let We percent that for that investors. them. And the of want Split, to problem for there. I reason are And

small that investors. retail are We of investors our have very fraction

we reflected Right buyback. are now, acquisitions back think Going in our much to than returns investment buyback. stock better

that. it down that have lot, do if becomes because You stock don't a then attractive. We doesn't to we want to happen. hoping never do open wanted I'm goes say authorization

side seeing. don't there's having interest do have ones, also And I days. we in as even that that attractive wrong nothing see those. these long we'll some acquisitions, cash we're rates as the with small now, on right But the

In debt less we have pay we to down So down then it's going of to XXXX. debt ways, this unfortunate X%. million pay fixed than But it's $XXX have about at some in don't year. because debt

have we'll lot available of things. cash a So do to

we we'll think So be okay.

have Joe TD We Giordano, a Cohen. from follow-up he's representing Instructions] [Operator

But share. less some environment ask time a long so know you for kind the maybe for mean, you're in took price products, price you what next that I for environment than I you kind vision everyone since think how on year? was here. could areas, how price you before and less those thinking made said And probably of maintain curious of your maybe to have took Just evolved -- strong in the pricing to the part wanted pricing of just guidance has a I is you some because comments of

First I'm going price say, point, in some 'XX, X%. increases. broadly X%, to to X% let's had backwards, we say nice

We in obviously, we But contracts that some X%. expect like as areas you not price to government [indiscernible] areas, the In some such. can plus able same the 'XX. then were than in prices peak increase increase cost more are

we're X% is for I So think X% to what looking at 'XX.

And we participants have time. this no other queuing at up

conclude you I'll just I'll ask much, please have call. Thank very -- Tom. Jason to our

if number you information, give . ideal. the would conclusion, morning. questions, Thanks, earnings And us on everyone, this could release. And have the thanks, if that joining the replay free Robert. be Tom, Again, you for at follow-up just please feel to a the me call

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