nVent Electric (NVT) 2 May 212021 Q1 Earnings call transcript

Ladies and gentlemen, thank you for standing by, and welcome to the nVent Q1 Earnings Conference Call. [Operator Instructions] I would now like to hand the conference over to your first speaker today, J.C. Weigelt. Please go ahead.

Thank you, Amy, and welcome, everyone to nVent's First Quarter 2021 Earnings Call. J.C. I'm of President Relations. Investor Vice Weigelt, call And Executive Wozniak, Chief Beth and on Sara the Officer; Officer. Zawoyski, our Financial are our Chief we the on provide Today, our full as details quarter outlook. to provide and XXXX performance an our update an quarter second first for year as well outlook will

outlined me release you uncertainties statements are to nVent's risks and made statements we the Exchange forward-looking the company's Before Securities subject press remind Commission. begin, about as in the filings with risks such let and results that today's anticipated financial and future

and Forward-looking publicly the statements will the which Investors you the appendix are accompanied the of after the our And subsequent section results reconciled made company References to anticipated prepared time statements questions nVent's materially to no of as are events financials to update is for turn of find results. remarks. can call to I in over non-GAAP differ a circumstances. Beth. webcast Actual in today, could by obligation presentation. have presentation, We'll reflect website. or undertakes such from Today's now

Thank you, good everyone. J.C., morning, and

the on our environment. year. I to our X customer demand teams price demand initiatives. progress restocking, challenging that a This in while how strong ahead first earnings well delivering executing Executive cash. this Our expectations realization of Execution Summary. slide was on was was Overall, March. as in we great both channel growth stronger-than-anticipated good on make and strong increased so a as was our titled as to of saw and which are result proud productivity particularly sales, quarter of performance were Beginning am it highlight continue another start of well

in well quarter, our the and safety infrastructure early top well strength our particular and verticals. execute February sales ahead wellbeing growth stronger. results to returned in guidance March. to of strong continue as Enclosures and on to employee emerge in We remains in update and priority, priority saw the we financial the industrial Our we provided with are of as ahead We the within our

saw an was pickup XXX broader sales execution of main in the reflecting And basis on marking million and quarter XX.X%, believe for recovery our -- generated performance our points. For in strong quarter. flow. sales a the increase our the recovery. cash over-performance faster $XX a nVent, we globally, this We drivers to were global to Return we

$X.XX XX% of EPS adjusted up year-over-year. was Our

to year strong the raising Given start guidance. full the we year, our are

difficulty] ahead originally we quarter X% number a or of Now This the performance. drove our quarter million, guided were first line organically. believe was at up Incrementals to. during performance. XX%. of slide on We X, [technical robust the to factors our down down reported Sales to were top well of $XXX X% X% X%

and of Enclosures One X% first, expectation Recall, X% our Enclosures up was global organically, that were out. is playing sales within recover the those accelerated organically. would that economy. is recovery and industrial up the were Enclosures sales of

due a activity the and supply combination saw We ahead in meaningful where restocking improvement believe inflation. buy was factor Another we of that around chains to inventory channel low this was uncertainty the restocking, March. levels, of a

vertical optimistic continues of we are on our where one progress we around results XXXX. sales believe some the economy driving of with higher electrification companies mid-single particularly digits. telecom, likely our more strong the freeze XG modest discussion, and to into is Management data grow Electrical we and A up saw we of positioned and best Infrastructure believe In strong out double & the [Technical growth saw was and this number Thermal through center residential, America as XX%. other further While protection. in energy, difficulty] Fastening global underlying recover, verticals see wiring growth, renewables. networking quarter, sub-verticals which everything, mega-trend. by focus growth, to up this about pipe fire-rated commercial will saw North pull strong factor still to MRO, were as One are and first and continue weakness including in digits we Rounding the strength growth driven sales the solution and we

organically Sales Turning continue were within the high-teens distribution, growth to to of lead growth as double-digit America with China up a continued although saw to almost geographies our us. North Europe area geographical focus expectations. European is ahead they as within such which strong X% down modestly, year-over-year sales performance. for Emerging improve, and recovery.

our are the order the year This our first raising momentum. quarter we Looking ahead, in in guidance. strength reflects we full saw

our While are cautious, the struggling and that remain supply the of constraints we given chain regions still COVID-XX. is outlook fact positive, with world

thus costs we've input around outlook Regarding far. inflation, with raised are increases of price the our and realization on year a for strong well number executing

outlook product and go call and will now XXXX. and the resiliency emerging availability, we Over over to in our supply products, been strong stronger. and increased turn able to we've Sara, new results our respond to detail to please our proud quarter our invested some have Sara that in the say and years, customers are execution first for I due on several ahead. capacity I'm updated for to the last well chain converting demand.

you, year to Beth. exciting such begin the with great performance. It is Thank

Orders and Electrical sales with first during particular strong of positive $XX positive was three all a to X% of X% cash summary, million plus last XXXX. X.X segments, up turn range we Let's or increased return of particularly increased points line million. to $X.XX. guidance quarter, review execution quarter to this turned to took a offset and across the month outpaced year original $XXX strong realization adding saw March execution were Price EPS In strength $X.XX in in the by delivered Enclosures. quarter and productivity of another we more our in quarter Segment above We income relative slide than good to Adjusted inflation, Sales $X.XX approximately growth. strongest from organically. was and operational price performance. and our was during Fastening. Enclosures & of quarter the X driven the incrementals actions strength, top XX%, XX%. flow Free XX% to productivity growth. and cost was in

particular, broad-based please and volumes increased digits. XX.X%. In sales and Now saw basis quarter Starting IEC grew discussion high operational in single X X% productivity. accelerated driven return Enclosures, first turn $XXX portfolio sales data sales expanded grew growth, expanding to organically. growth with reflected XXX to by to double-digit for of of in a with strong million XX% industrial on and our segment slide segment our income We performance. a Incrementals points infrastructure. networking solution recovery increase, XX%, returned strong Enclosures of

infrastructure the us on relative outperformed sales due continued utilities demonstrating on at Order & single-digit and progress expectations Electrical & industrial, strength Incrementals through XXX strength declines The a and was continues double-digit on strong comps. in with difficult -- Sales Now solutions, contractor as everything, with confidence verticals, improving sales basis on and critical of APAC. vertical XX.X%, team return as Europe of points last focusing new to on year. in income growth relative resiliency sales were segment the commercial while to low up Electrical the growth And improve million modest was the up to areas very of perform data portfolio this growth Fastening. sales year. our can year. return gives products, to networking X% all we fast in and electrification sales all $XXX infrastructure Global level, to last high center in return power in up and all XX%. Fastening organically, were in XX%. expected, at channel improving growing conversions, relative and, to

million Thermal Management. X% to declined $XXX Sales Moving organically. of

XX to And MRO, industrial Commercial up sales Thermal spend continued the and projects see double improved reductions. orders were While on in to industrial to sales mix Management benefit the and continued Sheet basis cycle of last changes we $XXX out. strength we continued the due in segment from X%. sequentially The we particular down are X, Flow, to business wiring, structural MRO. expanded globally. due million. Balance On slide sales impact Cash digits digits made to was return quarter low cash with income reading negative ended double a residential titled up points, balance margins declines with as longer and year see fire-rated a remained in

an on million our additional We have $XXX available revolver.

robust capital capital working usage. And make goals. with the pleased during improvements. free the we're our operational to as performance typical quarter progress as cash strong positive result well of versus This flow in was continue working We our

EBITDA adjusted completed at bolt-on of end first Allocation two in target second further Update, Capital which Turning range expands quarter, with to debt times, slide X.X we our the at Enclosures X a the early quarter net to We the the into Vynckier times. exited portfolio which to remains X.X our low of infrastructure. of acquisition titled ratio

sheet our help us also We and to a growth generation We $XX strong quarter M&A in shares believe earlier offset invest in strategy. cash dilution. to in the in and our repurchased good million execute balance puts position

XXXX titled for the slide full guidance Outlook, to reasons. year raising Moving following nVent are we X our

performance First recovery, which the industrial is faster first in sales particularly in strong reflected a the quarter, our vertical.

that confidence book to Second, the our continues gives us order economy recover. global

ability to we which competitive which service a positives meaningfully demand. of Offsetting believe performance, increased. our operational these strong has our increased view is an with is is advantage Third on inflation, updated some

Enclosures executed price multiple have We successfully increases Fastening. & Electrical and in

monitor actions to profit. pricing our of continue the inflation productivity and We goal and protecting evaluate with

are year. we a our versus guidance $X.XX grow in to still and expect XX% and X% original to now strong the expected now confident but Enclosures X% new Strength sales From EPS with to be expect early off to to in the ability continued are We drive to the of reflects benefit in earnings it versus XXXX. expect to the our vertical growth $X.XX in adjusted is XX% in of a resiliency Fastening guidance guidance team's & prior execute, range perspective, our infrastructure start versus of stronger is XX% our of industrial X% to We $X.XX. to to sales Electrical in segment segment commercial. recovery and most. to $X.XX a This industrial

this to are we a expect industrial two in positive continue Management, commercial tailwind year. be gradual a currency, and to recovery. sales and order expect Thermal For now improvements we to sequential in more point given this On MRO, trends encouraged,

strategic at year investments. our strong flow income adjusted start continued lastly, million. another conversion costs corporate to in expect to to a related sooner, is And compensation of of along and guidance in $X relative coming initial response We cash the by approximately net temporary costs higher year, accruals or above This increase XXX%. to such strong expect to we some with

second our outlook at slide XX. Looking quarter on

expect We growth This supported XX% in organic significantly by the in to the high single-digit is a order peak particular sales global shutdowns in we XX%, that to wrap as by up strength March. quarter pandemic. was be with quarter impacted first the of outlook

which growth a relative inflationary on quarter. XX% protect We XXXX the $X.XX quarter around expect customer take between handle Wrapping the executed up, to pleased last attractive quarter the due meet actions margin demand. the we and our profit. to to of adjusted price-cost well and salary and to we second causing included execution, reflects actions in in during volumes. strong taken expansion We of strong to at actions of EPS necessary first with and reductions believe pandemic, incrementals the Still, be furloughs expect increasing headwind Recall, this benefit a midpoint this expect structural We to XXXX and have peak good environment performance. $X.XX, the year. I'm

in I turn momentum, now This up With to the expansion remarks, quarter we back the with and growth, my strong set great a robust order and concludes we over cash call successful for sales Beth. first are year margin believe generation. will

Thank you, Sara.

slide to XX, XXXX to I priorities. the Turning made our review we've would progress like on

Our wellbeing first of priority remains the and our employees. safety

Growth conversations We've seen they remains geographies. navigate a inorganic. a other particular improvement and engage feel recently us, as with in priority strength to to in global for this we employees organic with and ensure continue crisis. both safe marked through regular global in Europe supported sales We continue our to and

launched as as nine our growth high the single-digit Enclosures. among We include growth and business. quarter the Our alliances. data our during saw quarter. relationships to European stronger as is such the These distribution Universal as XX%-plus strategic paying verticals strategic connected with well in and high-teens a Free-Stand solutions rail well products Thermal solutions during with distributors build growth We networking new initiative in as focused off of portfolio across Management

product are into track progress by new teens. strong from products margin these our XX rise vitality, revenue continues contribution seeing tracking on are to the Recall, a we over We measuring are high And to year. and launch which this we products.

front, On back-office continue drive go-to-market, use digitization data of new functions insights capabilities we We're intelligence, factories. the automation and support launch on and and to of digital our our growth. us helping to expanding our

we and We and this this productivity XG. acquisition high-growth also providing M&A, improvements. an segment, Vynckier On completed strengthens verticals which expect earlier to month, as such working drive our positioned capital nonmetallic portfolio expanded solar, utilities in the us with Enclosures

We center cooling CoolIT for and see strengthening and a networking, leader with Systems. in our capabilities. a partnership solutions data also strategic further are formed They we this cooling

expand globally. strategy is upon M&A to leading our to Our great and brands, positions build

Both very orders successful pleased with WBT. in are We double are up integration the digits performing and quarter. of with Eldon well very the

here believe delivering grow a invested well than to believe earlier have to and value integration across Since little acquisitions. create see a of the in under we robust in increase in The business role will supply are global recovery highly have a continue in and around Enclosures, and and what's and even improved of believe the demand. and continued segments M&A play capable is of We We pipeline would and the in our way see shareholder are first value. M&A then, we chain planning transpired management We to electrification playbooks competing a mega-trend anticipated. fragmented a positioned key is space meet have that all strong we we quarter. first our everything. capacity of the We said global through the ourselves our and recovery

healthy attractive have returns. look to deliver We a M&A sheet opportunities balance and that for high continue

emerge we've year, put made advance in stronger. a Over us to past in the to decisions position

order results emerging stronger. indeed as quarter well us confidence the as first Our give our are we book that

cash improved, has outlook at for high as a improved income the Our Wrapping on and level up generation. both growth executing year deliver to and XX. as we're sales slide well

a we Because are we and and many products on from we sales of toward to electrification products more system digital, We bright excellence, have brands, trends. of for macro strong drive foundation we prospects. with With everything, benefit solutions. our trends can the growth believe new these marketing positioned and the and demand Spark strong management our momentum our our believe well

as we within to bright traction global continue strategic is alliances. high-growth verticals, future and Our gain growth

expansion In addition to strong growth, generation. we're executing at a high level cash to deliver and margin flow

and a are operator We a to path over stronger Q&A. I making to company. start are to will now call turn the emerging electrical on high-performance nVent that, the With

with today Sprague Instructions] the from with Your comes first Vertical question Please Research. of [Operator Jeff your question. line proceed

just on Maybe could. bit more everyone. morning, Good you. we a Thank price-cost, little if

you full covering pressures X.X% that at anticipate for So be are cost And the in you anticipating on point? price shared that dollar-for-dollar up price? that would was QX. the you year What this

morning. Good

could. Maybe little on bit morning. we a price-cost, more if just Good

up anticipate that What pressures X.X% So year dollar-for-dollar that anticipating on full was at in you the for would be covering QX. price are that And cost this the you price? shared point? you

Hi, that. I'll Yes. take Jeff.

a So by good at X.X that year I realizing terms track do inflationary anticipate saying a got would the I as think mean inflation move with of start start I QX, increase. and especially And is into record -- that pricing just evident in will QX We periods. sequentially, price, in we've strong we to these good points. of

that of inflation we've terms recall, in. rolls lead a in us kind a of gives got bit when of strategy If a you that time locking

sort as expect inflation the we that magnitude. as of million anticipating in to initiatives. productivity from QX time, increase are same sequentially to here to at would $XX pricing But we QX, uptick So our well

the I inflationary last the with helped that with expect on productivity overall, we're price leave defined the expect for year even continue from a sort and material the positive. by of and that is, of full last well also equation to year, of but just think would standpoint, temporary structure execution modest environment, really So sort these expansion to And the you side more of is we gross of as in And volume coming the we to as work along to cost a the the manage I cost execution. neutral think I we testament that more to costs -- price-cost surely point year. that operational equations that did operational with seeing, run and

So price, [Technical the Jeff. that during cost is to we're continue year, something difficulty] going

that's kind is of like channel on any of would side, what saw that, channel how unfolding the the And you the on to the there relative unfolding behavior just on you in it it's kind Enclosures, side? in inventories preordering? indication demand looks EFS describe of And level

Yes.

So started bit also were improvements recovery seeing that the -- earlier. position, at EFS, And in some other starting we distributors they're to Enclosures being dynamics or a couple there, some I are because I also so strong, across that March, of we components EFS. of first a suppliers think allocation little not. think did or the then in is a some but to see take the channel trying

So that going I to But they've think still they got restocked. ensure think wouldn't stock. to they're trying it's they say that have improve. continue to fully I

think I demand. as improving global it's they see

there's channel terms think some still the globally. I in runway there of So

Great, thanks. pass on. it I'll

Thank you.

your of Wolfe. question. Nigel with Coe Your next Please with question line comes from proceed the

morning, Thanks. everyone. Good

Good morning.

detail, on wondering under I'm So mean, about water. we're forward MRO easier bit comps And remains the in you're But going just more talk moving if MRO, -- much into pieces I now. on good specifically on the you obviously, Thermal. with running just what details Thermal? still could still -- maybe a obviously, seeing,

in expect back growth presume we So to XQ XQ to But would get XQ. sequential I thermal? growth in you Thanks.

Yes.

-- QX. the would this of we're released. every including quoting, and into area have seeing a say was in return saw getting and an I where first impact significant that improving projects -- MRO, But spend quarter. of we we Thermal was quarter, some seen to XXXX, and those across of that activity it's that those On all some and would expect growth a in We

going So XXXX. to improve it we're I continue throughout think to see

America. do here globe, across North but this trends quarter, pluses much Great. across the and constructional pretty minuses some And we've stronger some comps, in you've expectations seen generally improving the But year construction? what particularly you got this commercial commercial growth? much you And see speaking, that portfolio. more just in would in confident are And be now end market? again, I for mean

that see say we our it down we talked And we would Day, are. I I Yes. Investor think commercial being At about slightly. improving.

that could think there that are we're be even products just but positive. maybe a lumber. what thing carefully, slight watching products, constraints, our in flat it not our through very to supply heard One I channel, as is distribution I've So

timing executed. that of so when projects of And may these get change the some commercial

that be have position. particular, contractors. I from in good we our definitely is And a to feel -- new business launched feel healthier. we're products, -- commercial that think we're will We EFS that convert in us going to So and -- be it's allowing customers to

what of constraints some about. timing Just other being cautious is on we're supply just some based chain the

that. for I leave that. it Thanks at

Thank you.

with Please comes question. KeyBanc. Your Hammond next the your Jeff of with from proceed line question

everyone. morning, Hi. Good

Good morning.

leaving the Enclosures then in fair is segments? the standpoint are us you're it putting and And kind in contribution you're it other that And guide? if just is of the from on what just the unchanged? there Vynckier in guide, -- Just not, give increase to where a largely say two you other within up revenue for the

Yes.

year first. the and two also show that the in, includes Enclosures. also look, half, We really we're And almost X%, But is EPS benefit nicely believe on seeing currency, points increase roughly of which then So integrating organic it let probably industrial, focus to perspective, X% contribution on more And next as line year, and point top of Vynckier, that for bolt-on us. I the in an all infrastructure here up mostly year as growth. again, and side, strength to us a but -- the mostly predominantly well. And so acquisition we and in that's meaningful up it see from X% Vynckier additional say from the walk That stronger size kind was going for presence really perspective, XX%. this an smaller in space. at would first think I in sets now would to reflects having EPS it's start that's to some me there on that the then terms for of guidance, infrastructure just the a another really EFS point from it

price-cost, the Okay. and Vynckier the pretty price XQ And versus exceptional. cost on then productivity in back in I was mean incrementals

when most are you which seeing price? you any, if do think is you? -- where, quarter challenging for of Just on And kind pushback any

QX, temporary take Beth be first, the incremental is about The we clearly, can comment the I'll to kind going and XX%. from just to biggest I of do factor great in expect cost. first So execution ease maybe We being perspective, the say, would feel price there then of and incrementals able that QX. deliver to upon the comment. an question

temporary our last year our you the peak actions in will, in QX you business. if cost was at pandemic lot of its to concert impact a terms of of peaked, sort QX If in of where remember, and

in and the spend to the temporary here as and some QX. QX our of to as and some temporary T&E as of in fold to QX well more as more also discretionary So corporate we'll up show in cost and begin headwinds in expect relates kind costs, that here costs fold of our it

QX, coming this because costs from if... and well in incremental those the most of of I temporary volume incrementals expect year. temporary know be like QX some as just are of pretty an the look because our just feel overall still contribution going standpoint, those good costs from don't to to challenged as we the So for And of probably the lack

sold say we're distribution recall are would environment that our in. Yes. through inflationary completely distributors majority understand this, of And the that products the the and I again,

so to go think, have we Now our got may And we've that But adjust that And usually, business some we're some adjust it pass and very clauses some pricing. able portion then direct. well. notification we in down -- to there they're them process, give their I able due pricing have of a we material to smaller have along. that

I especially timing ability how So would that. any timing we're when more manage, inflation seeing manage our not It's we pushback. see say rising we just of the quickly. It's and just to

so Okay. Excellent. Thanks much.

you. Thank

comes Capital with next Please question Your the Deane with proceed line from Dray of RBC question. Markets. your

you. Good Thank everyone. morning,

morning. Good

gave is Hi. pull-in? be may just of indications, color kind or helpful. there for Like would that? inventory there have in there been that quantify you channel you that remarks quantification might it that But pull-in. Is And the And just insight way there the been your to the in circle some back any prepared any said some Beth, you on quarter. have Enclosures can

that we've exactly, was multiple -- that that Yes. QX. see factors going pull-in, referred I to our growth first, said were Deane, quantify initial it's in to happened QX, hard return going to I I because we When view that in one and because to got on.

So happened phasing was planning -- earlier. as far and as our that

to restocking thought happen QX And so we seemed be in had would QX. in what

been electrical demand. The would world, really we're about challenges actually significant well second are of supply hearing because the in and make we have parts managing I responding point is other chain

I sometimes are given a distributors in of position The they've have got behavior. think see to ensure that inflation. So that with that third, distributors other taking are environment, we of want there usually stock that in would the access, just some constraints areas. And that say advance we this to this inflationary they

So more is QX. it's actually we factors think of some QX all that we those strength the in in that -- compounding anticipated saw it's why we

really thinking how the in got All that year, for into flow leaving or though free drop-through about it's higher terms unchanged, That's appreciate earnings. the you've I cash cash you're flow I And even cash free for flow free But additional the of yes, better. reading helpful. right. the then XXX% And just guidance see And boost you're year? color.

Yes.

Deane, flow free right, cash to difficulty] dollars, expect would those So net performance. with the along we income better [Technical

above, we at in while percentage of income that. with And so still the or concert right, would the net see increase dollars

positive stronger free think last I a a the that reads from is I of initiatives, by performance start. way the the year being you great some flowing capital of there, impact cash just and to carried with working even we're over pleased that just And of early QX see flow. some of activity. mean through good our indication really

And just one sector feathering first And that the using we Good. question. temporary last term were Sara, you of the in in heard the back costs.

these you've come And given the visibility good of terms how back so in into P&L.

those the are back that sooner. for costs what timing and say impact? and did You come Could to the you frame there's some additional us temporary that are starting like

Yes.

to in, think drop return of we're is the is business from a what continues will you're seeing going costs. what to being I those but one-third I one-third of invest seeing reductions. last T&E. begin So more then in some in discretionary in of that Roughly of that we're was that QX. million. we spend. costs think, was And was lot that of roughly in more the discretionary just was And talked the about to QX, And temporary -- QX a year recover, as again, in I And more and $XX T&E, salary volume QX, that concentrated Roughly perspective. that one-third think and really

well that a is future as these now it's of that in growth. of strategic So as investing matter the some investments kind and of here in

is accruals just a mind think performance. Deane, in to I piece, other too, that the stronger higher with would maybe keep just come compensation the

Of great. Thanks. Great course. there. That's color

of Your Mitchell Barclays. next comes Julian Please with from the your question question. with line proceed

to back just guide. margin I Hi. to Good wanted morning. circle Maybe the

the in to at not year first margins maybe very It like are the so. guided half the full think the up level I operating is So up be looks much. bps or XXX

think, year-on-year. half second I margins the So are down implied,

understood second versus I guess, temporary obviously, Just your confirm the be cost in I stronger, whether also And the so, that's growth QX. organic should half if aspect, but correct?

of haven't on there discussed? margins is are in that year-on-year kind yet that else weighing So anything we those moving second parts half the

No.

growth, I think mean you the they quarter most an from the are you seeing not necessarily and going just of probably I with And ROS. incremental -- costs already. already coupled year-over-year our we're back we're at are more because not difficult really growth I standpoint to a to to environment, that inflationary think have of anticipating going QX I here we've temporary more that these being but seeing as necessarily things look then half, still be highlighted. strong of in QX just that pointed just -- that

continues here, I'm well. to to is continue what to actions some the continue and there pieces think execute confident quickly run I take we in scenario, moving but be

the going get to that So we're ROS expansion despite to to to temporary these levers continue for manage and of inflationary that the some all year, seeing. costs we're

increase segment average? year, on bigger there we Understood. the perhaps smaller up on Thank segments where you. companywide, out relative full the should And that at see anything firm for wide a basis, the to look when being margins is then to increase a or call we

Yes.

of last as year, team the of price-cost really, they we last off part and the So because is operational side. great MRO. as well. this the managing half part flattish, of job a that well consistent that ROS anticipating we from Thermal, recovery the little as see lows the as structure Thermal. well really benefit the really on that seeing. we to with the back well recovery entered largest an in because to again, continue in equation more had team Enclosures and in doing well price-cost cart we're the kind just productivity EFS, is in cost the a bit some seeing industrial bouncing ROS that year year, the expansion they continue executed with as as excellent as And how in that very had, performance manage Enclosures

Enclosures, and we'd most muted bit Thermal then EFS expansion the on really expect So side. a and the ROS more

Great. Thank you.

your with Goldman Joe with of line the Sachs. from question. proceed comes question next Ritchie Please Your

you. Good everybody. morning, Thank

morning. Good

morning. Good

Hi, you level? segments, little to expectation XX% would organic this on think different provide guys. through segment color trends of also, think When XX% well. the provide what from is about a to and at any on be if maybe bit as guide, you color helpful April point, the And that a XQ sub the there's your

to that industrial to expect strong we're really more a recovery the we'd we gradual this, a from to is growth pack, that for really, rate would here. more QX, recovery you I Maybe is Electrical just And to easier growth the of Okay. expect comp, but We obviously, part of top an due Thermal, it would QX the well. level. expecting line And that. through an at that each one if perspective as Fastening But nVent of I Management to Thermal in Enclosures be flows strong see helps comment again, make, we're other will. point indicative seeing. the do segments. And leading think and order & expect mean I double-digit

look it's might prebuys, the of because think way, for some at basis day at that, in on helpful And underlying of but out it it one terms lowest be from we And not will it April year-over-year that If continue But a day. we probably to in see recovery. less perspective, a per April tell right, I what February. January months was of nVent, playing the sales March perspective, so kind in of half. per first from particularly is the ahead of you to here do our restocking that -- a because Enclosures. and little that becomes it just those last levels, an we at year it's does that and From that benefited point

a So we well us at track per basis, it again, from day look as to it puts the QX guidance. on

follow-on Thermal That's a helpful. second. And sticking maybe question, just guess for I with my

on I to the Brent customers that guess the on year some oil really gas around the color are spending. better? sitting be what yet now think you're the And your A is commentary would a seen Do just You've recovery oil at you second that going XXs. be not half maybe saying? much high only hasn't of helpful. that and company there experienced

customers, quoting to our gradual based continued have we're that do And but we've it opportunities. we recovery. We going had the see discussions a activity on with the that on think also that we

we like were of, course as improve lows of remember, kind it the we the is to so going at seems planned that it, And just over year. And year. last

So that's to going We're see the expectation. that gradually recover.

you. Thank

[Operator King. David of Please proceed Instructions] question. with Your CL next the question line with comes from Silver your

Thank much. you Yes. Hi. very morning. Good

morning. Good

of that meet logistics get costs just guidance. first on maybe be or Hi. you to just -- going question some would your challenge may to your Yes. kind touch I'm issues My to

there, I maybe dependent risk going And might last freight steel, that what perspective, or have niches in principle a issue. in And of of was need? are And is about your naturally be sensitive in more shortages maybe of processed the just I freight firstly, couple wondering all that you. autos cost, highlight industrial you sector? might So I type just has the to other to you a anything number just there been your I customized beyond wondering, particular, thinking raw that limited an you then those might the purchased maybe at I'm any if any freight, of or materials was inputs. but all or the Thank and point, mean, just beyond prevailing lines, is are have semiconductor product that at way a within suppliers? availability there along been from other overseas. airborne availability mean meaningful

over But several when And we say we've were even some we've supply chains. had public dual there. ensure supply really regional relationships a And got done before our steel, our of would good what positions in to products copper, we've in some right? do. good the we and There got got I feel we've sources some electronics That we it majority the other very use we last some company, lot cases, Well, a years, nickel, sources. of comes Okay. to suppliers, secondary metal. always resins are the of

what's here So is not they've and for talked conversions It's think, well. in allocation. said us. been very and are we've and as When managed think said, obviously, and to electronics our a going suppliers your today, our electrical other of with do as some that. that have talked have us, some around it item that some I with the as we we semiconductors we've do many comes on say, comment I controls we've as sit That driving not case managed well. partners, to responding we've for as distribution very with in and we for big -- result. and, I've spend able of electronics, planned us, products. I think But we that we've I'll a again, for are manage And that But

is something chain a concern else is Our disruptor. bigger what if supply the in happens

managing is around -- could we freight. other So comment that's distributors. the rate convert. our the I many But think companies, able terms well we I you things But we're is fastening And logistics think other year, work And terms or all would we've this to of cautiousness given was I that we in yes, say, I other high. the from believe of remains and get just disruptions. and containers. our think like in very the it's these terms think recovery, I your But or chain that, our capital had And through of so just pace have things if and product been availability supply issues might earlier then in in that well. construction. We to feedback there's product, some another maybe in may slow down of slow cable And wire of be positioned lumber or hear the even it just really that instance, I for able we're up, Enclosures solutions. to maybe get the and projects some terms

not a I'm work, because seeing are so be very going pleased And to of that we're that. we're able to demand working with continue to how lot do as to it's respond that hard been teams demand respond we've our able to But improves. really and without the confident to

growth are pandemic and XXXX continue that. environment the customer business pandemic relationships, lessons company, you've year some kind targets, things, as And last new operations. during company question? Thank to back you're thinking operations up back out advance, My something hit one would keep and virtual XXXX is to to revert of price parts sense and going of of of success hoping with you little and open parts to of perspective beyond, maybe revert how the was been travel. next of into company I'll to to have be or point, On that's product this think that's from to that operating rising a think, mean enhanced. But you your managing might I restoring -- say you or environment, future? things was kind your be versus might even look could might a the the take and question a the functions some which I pre-pandemic may are them amount I the the I going the the future method? I XXXX parts you're So you in you is certain thinking apologize But What thing I'm operation from persist which long demonstrations. some a wordy. to provide going pre-pandemic strategy the about perch. this which for going in in And on the probably a into talked from

might just persist. get will in that things to wondering two I call pandemic highlights you was So if area each versus significant doing out era pre-pandemic or change back in you're the where one think you that to

and a I and and digitally to forward, talk agile. forward going right. that, become All about lot emerging by think Well, we've stronger looking

we've information is that say, cycle not built digitally, would to get away. do we as to of digitally, velocity. extending digital products, what forward, training and available reduce in And our our capability terms And launch that all move launch to all velocity, drove digital so think to time, go us we we It I going to with new -- to that to market That's have methodology needed new into embraced do how we as agile we how now of year the to allows our about programs. have our this we products.

when will way. important. Now launches customers that will who competitive meetings a digital be found we very a in this because operating new that advantage that's environment. channel and think working having We in And flexible the in very it's that of ask a But products to I level effective really partners we We can found more way. for have we times our get had digital there reduced, even for some supplement, be I will would see us, more think more I way be operating important. company. cases, because we more and productive. or that think will face-to-face is is forward We that We to be think the can

agile see So continue going that the I to of really to build don't we and us that approach going think forward. I see back. us approach digital on. And to I everything do it's we're going kind momentum just

And $XX first if you share this. creep quarter, just maybe if one there this I'm million the $XX and be could just million or Thank helpful. for I'm that something be the year million is spent sorry in wondering Just had creep targeted in But Okay. offset that creep? offset Sara. to on was offset Great. last would quarter share one share quarter in the or I year deployment And share first then to I $XX to -- your buybacks. offset the it And I creep to spend was might sufficient But you a comment believe missed between? capital full of per you. Or dilution.

done think we've it XXX I good million with So rate shares. million along in And QX what at in right? QX, that diluted in a QX, we an XXX QX exited in spot, sit we with of share roughly what with exit mean we I did us Yes. here for a count shares. pretty puts

perspective, to right? QX in what we're we think a QX we monitor, dilution. in puts us to spot. and us going did any here to again, continue offset good So in expect continue I that a it's From something dilution did to we'd But what

Very you much. Thank

with of Justin your Thank you. comes line question. proceed Operator from Your Bergner the with next G question Research. Please

Sarah. Good Good starts Nice morning, the year. morning, Beth.

Thank you.

and sort and point I XXX how I Or guess price sales how volume? of full maybe have out now? would just year much you is incremental in your couple a the around revenue organic break incremental price price-cost guide within that of just questions on organic your guide, increase between volume. basis

Yes.

So point in you being that think volume and terms of probably price. a of a could about that incremental that guide, of point being

somewhat I be pressure. we actions on But a we're in the to that gives from and to as QX. terms going to start, kind good and of you fluid, think took pricing again, think in inflationary will, of see indication QX right, year upon, relatively I of here that's price, you dependent think I guide even a because that's full continue fully we again, that monitor the and it's if inflation going how not getting act realized, unfolds, still that, upon

expect And to over that pricing again, higher just two segments year overall of pressures on the the inflationary they're points. for than to are going So be some that based be seeing. we would some

some I Okay. the your opinion, of think competitors on inventory some in positive competitors versus your in? And FIFO do of camp that guess Or this And And of are That any your that slight are than you camp to with that your mean ability maybe but not are forecasting is makes guess better answer, FIFO put is all price-cost. by doing I'm accounting? negative forecast sort wondering, sense. them accounting competitors inventory I just a positive of price-cost. system positive you're to positive your impressed aided was what difficulty] [Technical not to I I are. price-cost, in this hard and you

on it's Well, offsets it sell also let our price -- of we always that value. salespeople to teach me both -- value. We is respond but just think matter inflation, a to

take look one of EFS particularly at right, we value. new when commented do is we launch which things on so the how products, out we labor, I is business, in our And

margins higher value so that with or we launch result stronger a of products new And therefore, creation. price points as

very do think that's things think I we well one is company of So that about value. the a as

how reflected gets that Sara manage therefore, comment. I'll price. the talk And FIFO we so about And in let

to I it back I about, Yes. strength, comes I our capability. testament pricing does us, order actions. good I to mean down channel the our think We're to that it right period, think just in as brand right, service. the for But a in well analytics. servicing value think is right just to you customer capability also regards Beth increased visibility now. comes gives strength, some we what creation, and just mean into the talked I have make and some pricing here our demand the time just it

the going that of good in productivity. puts hard It's all pricing of side think not a lot with here. track to without along of I the we're again, us to But got good work think spot manage a going equation we've continue I So and to combined forward. record a here, it manage

bring giving wrap up of are suppliers the that you positive allocation. environment on to opportunities, your some Then distributor you're more can of they line Do Okay. competitive that are note, in you outgrowth market maybe mentioned constrained a because incremental of and this -- competitors just less of as constrained? on you terms what to questioning some see

those that about factors that of can respond. distributors talk we We because able contractors. at -- do at is conversions or we're -- is believe conversions one when supply there that to That because opportunity, I allow

Okay. Thank you.

you All us thank for you, right. today. Well, and joining thank

performance first we executing high our believe We a are pleased level. are at quarter and with

R&D, We a we believe improved, responsibility call. to remains high-performance remain capability Our the manufacturing Investments joining hope you on and nVent safe, This long-term outlook for our priority. in focus again. forward and top-tier to concludes top social company. us. growth, look Thanks invest We critical we're digital, you success. for which continuing to speaking and has electrical and people, a can make are

this Thank participation. for your call. you conference This concludes

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