Garrett Motion (GTX) 14 Feb 232022 Q4 Earnings call transcript

Hello, my name is Jason and I’ll be your operator this morning. I would like to welcome everyone to the Garrett Motion Conference Call. This call is being recorded and the replay will be available later today. After the company’s presentation, there will be a Q&A session.

I would now like to hand the call over to Paul Blalock, Garrett’s Vice President of Investor Relations.

Jason. you, Thank welcome, Garrett and Financial thank for you Conference Good Fourth everyone, Quarter the Motion XXXX and joining Call. day and Full Results Year

earnings mention Before about website Motion our important SEC where find today’s like filings, begin, also garrettmotion.com, available to company. will to we presentation the I’d at and information links release you Garrett along are on other that our with

Securities the Exchange note that and this The contains meaning our Turning of of to to only slide and performance within update the filings be company future and with you forward-looking factors and that forward-looking management’s two, such. we encourage aware the the to obligation should risk business, expectations only SEC, contained Act, risks our forward-looking statements we presentation the estimates uncertainties today, disclaims represent become statements as of read the them. statements are any of and in as understand in taken

measures to Today’s measures we to release reconciliations, the the terms in diesel the appendix We those in may gasoline by presentation using the vehicle vehicle of you’re also includes products measure press comparable reconcile each and to presentation our which to describe diesel and both GAAP those operate manage encouraged and presentation. light found way only. most Also and to business. slide directly which and the examine in today’s the refer are we comments, and non-GAAP light gasoline

Vice President Financial Officer; Garrett’s and Executive Senior Sean is and Deason, Officer. Rabiller, today Garrett’s Chief Olivier President us With and Chief

support over for Head smooth for Investor in of would the and at North until [ph], month. a you earlier would future. who Garrett Relations and responsible the and years and I Investor like headquarters Eric thank your like He to everyone addition, to a five to Relations. I is all joined remain Garrett of Michigan American will ensure I wish now Burge to as of activities time is In based end Garrett transition successful Plymouth, at March our Eric. this very past introduce

I Olivier. to over hand will now it

and Thanks everyone results for XXXX fourth call. conference quarter joining and year to full Garrett welcome us

would Paul since spin-off our as Head and thank for the like Investor like Eric to all I welcome wishing of I First, him personally support would the Relations. his I'm best. to also new

these team I XXXX will which a for three, dedication on results remarks begin my achieve to had our be I the results. global recognize to Garrett volatile continues highlights environment. in with what I'm like we slide year. performance, a start strong the and Garrett where would and pleased helped flexibility, with very their the for

were basis, XX% sales last a Adjusted million versus the currency up in $XXX the $XXX basis. was EBITDA up same constant million, on but net period QX, period X% In GAAP last million year. year from $XXX on QX same in

quarter Our free at the QX was year cash million. $XXX highest of adjusted the flow

in and weaker the to offset the the a moment, take quarter that driven China, who in disruptions want effective employees to quarter a lower volume again, mainly performance strong our This late in and once from in you operating were thank first I a very in by give euro headwinds but special softness all China, inflation and sequentially a COVID manner.

vehicle mix businesses. richer driven a and margin our from benefited also we commercial aftermarket by higher QX, In

FX is with recovering currency and efforts driven successful in were mix basis net on headwinds. billion, compared a strength our on just This sales XXXX. up constant the global by inflation down GAAP For volume, basis essentially year, gasoline light vehicle X% points. pass-through outpaced by in This offsetting but basis, production full $X.X a XXX X% over growth improved

high end the Full X% million year $XXX XXXX, latest due of adjusted outlook, FX. but versus to down our near mainly EBITDA was

increase into solid we delivers even inflation, XXXX, as and a improvement technologies. For productivity electrification in pathway investment Garrett

structure to production. our demand chain availability, and ongoing continues cost flexing Garrett volatility China offset achieve in Importantly, his target semiconductor to Supply lockdowns. accomplish this disruptions, manage including We in and valuable highly volatility. lower during by

The was year XX.X%, adjusted XXXX XXXX. compared in EBITDA with full margin XX.X%

While details basis the along in lower that's Sean in few at year with points. margin a this of the impact than what FX more discuss is last minutes. inflation costs combined will XX

XXXX. margin XXXX are However, into taking this with essentially consideration, the flat

accomplished pressures. results throughout In the of offset coordination pass-through, productivity inflationary inflation the which improvements, XXXX, effective company. along with very important was great and Garrett This achievement, significant an

of consistently our margins, valuable and track produce generate Garrett's result record structure. direct a ability cost cash volatility solid of and that fixing cost of structure, times to is highly even in our

our addition, helps grow business manage In solid performance product across portfolio cycles.

to combined earnings our of earnest XX% stability. sales price market our example, sales For margin contributes net and commercial from trends, is data on higher products independent of vehicle on light and

both sheet. Throughout Garrett balance deliberates its and simplified XXXX,

the million us adjusted $XXX and cash of to flow QX the generation XXXX in early the fully preferred enabled settle to and QX in cash. A is Series B for series year payments the later redeem Specifically, in free shares dividend

debt once flexibility enhance until maturities results results financial is Most continuing importantly, position liquidity significant to our to XX% year and now no continues maintain in ability at strong environment, our with interest while Garrett's with payments strong -- of enhanced favorable volatile long also XXXX. at full low a flexibility. Garrett fixed our by $XXX terms, of debt a demonstrate Garrett's term again deliver QX and XXXX financial million, to rates.

keeps an differentiated electric core Garrett's Turning which platforms, gasoline penetration hybrid includes our increasing. to by turbo nth slide is In technologies. products, four, performance business

gasoline In from is S&P XX% XXXX. turbo to penetration XXXX XX% now fact, grow forecast in forecasted light latest the for vehicle in to

applications also VNT are are of up our gasoline for industry to As innovation to translate a even demand XXXX. we to drive XXXX penetration expected VNT win reaching in Garrett will decades gains and leadership. applications Garrett. later ramp XX% rate technology Nozzle share greater by threefold, discuss, we strong Emerging into expect with Variable of business beyond The growth Turbine of

resilience to lightweight expect now diesel to will will products prove it Garrett's continue XX% continued grow. story it we vehicles has expect our as long and -- of volumes we in also commercial diesel represent

Our XX% industry S&P XXXX growth -- resilient XX% on-highway with to greater turbo by is XX% in from projecting turbo penetration In projected is on-highway business XX% also, adoption XXXX growth add to equally product even XXXX. increasing XXXX. from off-highway to

new solutions momentum continue innovative Our customer as add and meantime in exciting E-Compressor a contract gain in the this we to XXXX technologies. for new E-Turbo

hydrogen products of new penetration emerging highly XXX% ICE require Lastly, engineer turbos.

production year HX already. these expect into We later to this launch products ICE

continued I about of commitments XXXX of years future since Garrett's revenue. XX% to awarded up, already represents all business extending XXXX new strong highlighting the future. visibility continues of and it while rate win our projected into business will many Summing programming, the for XX% new drive sales,

in to driving is differentiation five, slide Now, Garrett turning electrification.

the you high of the and component left unique On high turbo speed hand design can side where capabilities. key we balancing Garrett's see have page, in differentiated precision machines capabilities

designed high of the development electronics. engineered build motors has XXX,XXX to and and The E-Turbo and also can in speed Garrett excess of power in coupled such E-Boosting rotate motors knowledge switching the also enabled power electronics capabilities developed and and rpm for has one as edge [ph] unique High-speed software. us high-speed cutting

where they capabilities provide to need efficiency are density challenges advanced these our leverage solutions to with non-turbo-related differentiated is to customers electrification address other and power key. aim Our

a am is very awarded won E-Axle major in first speed area project pleased pre-development this victory major report global a in being to Garrett. Garrett with I that a high for QX a pre-development OEM,

high unique We than these are concepts. XX also with working customers very speed more on additional

In cell North the area, Garrett Europe. you to have let in one help one products, continues are and three one in for size fuel key industry won the America, commercial customers. in awards Garrett XX we In you China fuel to win and for prototypes applications. series traction currently up XXXX, contract engaged we our working innovators over vehicle production tell series cell development provide To me with here, we XXX

financial it XXXX With further Sean will hand our that, to I discuss and now outlook. results over to

remarks I everyone. Thanks, Olivier, on slide my begin X. will and welcome

QX upper basis constant by X% XX% basis, at and net continued GAAP QX currency inflation Looking of for from left by eight you'll up last the see at a million, quarters driven reported a favorable and on XXXX pass-through XXXX hand sales on with graph, the $XXX mix.

and XXXX adjusted Looking basis QX at upper page, X% pass-through year, adjusted includes $XXX the dilutive period from and of inflation last of the points. million margin XX up impact XX.X%, EBITDA from of The was up EBITDA the year. was the side right-hand of million XX% last FX in $XXX

quarter from mentioned cash left of adjusted show flow Olivier. slowdown the bottom in Garrett of the earlier QX, that sequentially $XXX year, by we in hand QX of positive QX, XXXX, with On XXXX. And even generated best volumes free $XXX the million million the in graph, up

product bridge GAAP and and by with X. Turning We to all environment on We through by period flat were mix aftermarket offset gains last digit vehicle volume XX% partially category effects. sales and double a slide QX as show ability compared major primarily a driven lines higher commercial the X% on our businesses across Net costs currency basis product had our basis. up pass sales year. by constant across same to improved combined a with net

sales in of products currency, to adding now XX% at prior share and gasoline compared the reported demand constant year last launches net with comprise products by driven versus gains. with XX% year, new improved verticals gasoline of All up million XX% $XX sales, program

products. last products constant to in XX% results at of with and flat North These adding headwinds currency, unchanged America. grew downturn Japan for XX% was XXXX. are XX% year. in driven business total Even net by comprise and constant sales, total in vehicles the softening strong commercial Commercial vehicles Diesel demand represented sales XX% in grew from Europe, currency, China, there commercial million $XX sales vehicle significant XXXX in in QX China, the given recent a demand of this with where of impressive

at QX by XX% partially business constant growth was comprises aftermarket XX% XX% strong, year last from products Overall driven currency up year. sales, Our and net across growing over the of remained last offset FX. all

our X, show bridge, year. the QX adjusted we last with EBITDA Slide to same period compared Turning

million with attributed While were an – mainly same virtually flat, mainly period to these in performance million EBITDA inflation productivity. attributed last represented the This in is periods improvement. volumes adjusted improvements of $XX pass-through $XXX year,

planned. and as dedicate million the by R&D by of a was we improved by $X to XX% weaker $XX million And partially Overall, technologies. operating investment new performance continue R&D impact over of total increased offset euro. to year-over-year

the margin puts improved flattish without Overall, range. QX. XX% As our weaker basis and delivered the margin includes pass-through, EBITDA inflation FX a environment, in points Garrett XX.X% in dilutive and was effects from mentioned euro adjusted quarter and year, versus solid which the the earlier, offsetting XX% last in of in the XX inflation volume results

Turning now and a essentially to XXXX a flat Slide X, our X% at at X% to $X.X decrease basis, the North constant China billion in XXXX lockdowns, geographical split year compared currency. America. prior up net affected sales in to On were reported year. full performance on which we show The in sales caused basis, Asia by was X% was by with net down an COVID continued lower increase revenue volume associated GAAP by offset and

Adjusted XXXX was million $XXX basis provided margin of by weaker XXXX was the at $XX FX but than $XX for million adjusted with driven lower due variance lower this than impact lower end XX XX.X% unfavorable of free adjusted The of for same those Euro. down margin and essentially EBITDA and the million, Adjusted pass-through. our points XXXX XXXX for capital impacts, outlook, increased includes been XXXX EBITDA high majority an the the of cash expenditures. of million to was both vast have FX due of year million periods. $XXX last in Without by would inflation $XX to the and EBITDA by flow previously

each you of walk these of items. through let me Now, the specifics

products, regarding to Slide XXXX. compared and XX, bridge we net globally a across year our earlier of to delivered we category full show where similar the XXXX we product all Garrett's discussed verticals, QX. one number gasoline to what to XXXX, become expect in trend Turning by particularly growth sales shows as for which

our constant environment. higher to volumes sales gain in share XXXX, which expect into global growth operating driver We production FX from of million, $XXX in be translated a declined the as in improvement $XXX net X.XX euro sales in Without XXXX demand, rate XXXX. impact currency from is X.XX in in million key an X% impact the FX This to to by XXXX. a flat performance XXXX on basis, in dollar the offset essentially of increased

mix, primarily costs gasoline higher gains. of flat volume environment, The products of commercial vehicle passed-through this higher from performance aftermarket across were key and and drivers operating improved a share-of-demand volumes and

sales, XXXX, by XX% gasoline volume from and increased $XXX sales well in launches. growth of as net or million XX% up as comprised XX% new XXXX, product In driven program

driven America. the by North at at softening impressive, China, to for XX% total currency, and X% grew comprised grew Again, X% currency, strong industry. constant constant Europe, these sales products year of saw last XXXX in XX% given Diesel recent versus in vehicles million adding and significant $XX commercial year. sales vehicle are we the where demand results in Japan headwinds in Commercial

and vehicles was currency XX% but in up year-over-year pass-through, represent was mix up growth last inflation by XX% net offset XXXX. of and with Overall, total Commercial of revenue sales, Aftermarket FX. flat comprises XX% driven constant net from at improved sales, year. by XX%

for full adjusted EBITDA the XXXX. Turning year now to versus show slide XX, bridge XXXX we the

new inflation, on delivering pass-through the successfully technology while in for to continue productivity future. investing and We

volumes net year. impact For $XX compared a XXXX, prior for slightly mix million positive by the lower were of to offset

delivered all adjusted million EBITDA offset impacted a by R&D pass-through than pressures We operating spend by which weaker improvements produced $XX on higher year negatively XXXX, in inflation, we which million. that versus a and In inflationary more total, $XX full productivity euro the offset was year. and for

$XX year, to R&D an the million over dedicate R&D spending Over electrification continue additional we to technologies. planned. of XX% as And total we invested in

XX.X% $XXX XXXX was adjusted EBITDA combined due XX year. the -- of headwinds basis Total XX.X% of operational adjusted year by points was to lower which EBITDA XXXX by a basis, adjusted inflation came On The $XX improvements. in points XX full million FX at to and basis due EBITDA offsetting versus margin FX million of lower last pass through. impact

another new strong passing invest had while delivering year productivity Garrett in performance, technologies. and of inflation, continuing summary, operational In through to

adjusted adjusted in QX, cash XXXX. to range. free of for We and flow Garrett show this free million was volumes performance low than flow bridge EBITDA at our slide solid of despite adjusted lower guidance end to $XXX XX. full outlook year Moving the within cash delivered expected the the

flow taxes $X.X in came cash QX million. QX at technologies. impacted expenditures by for use cash $XX lower sequentially. driven was interest was electrification capital million, volume were a $XX free including $XX Adjusted And $XX versus of by Capital of million working million. a Cash million,

solid payment generation environment XXXX. in $XX as Series million addition, and interest allowed Garrett our In improve fully cash stock the B flow Series in volatile liquidity. represented to B was preferred was the redeemed final a Overall, this

dividend January million, Turning end credit cash, $XXX strong decreased million revolving with ended to Series slide which year after $XXX comprised XX. We undrawn for unrestricted ended A million payment $XX XXXX sequentially million increased on -- of $XX of a the sequentially, at capacity, and liquidity position XXXX. million the facility of X, of $XXX QX settled million $XX which

of a combined. QX During $XX $X.X a QX dividends total preferred for paid we QX million million series repurchased Moreover, of Series stock. A cash of and we

debt XXXX. in down to ratio QX in leverage its months XX in ratio improved X.XX to Driving XXXX, of last times times significantly Garrett from XXXX. consolidated X.XX the EBITDA our QX net

our the in sheet. are redemption movements early BaX, Robust outlook. see and consistent rate issued increasing to you cash XXXX, has enabled Moody's Euro to and upgrade the from the rating from by Changes simplify exchange deleverage generation debt completed Term in a above. stable with driven $XXX of million primarily the a Series us balance B full that BaX rating table balance our emergence, Loan in in the In B Garrett received we in stock preferred and

rates revolving at facility year credit and we year XXXX. during of from our As million end to term at during year, $XXX million the our XX% debt year of increased is $XXX fixed the long end XXXX,

of on finally, slide, $X.X bottom the combined both market see end cap A. the include at left of And the year and common equity will had a over when you billion, you stock Series we the our the

you with XX, I'll slide where outlook move XXXX. for to I'll provide Now, our

with as our provide of the ranges high our of low follows. being prior expectations, As midpoint with and we practice, guidance our

X.X%; of Net $XXX constant flow million; adjusted activities of $XXX billion, income a $XXX $X.X cash operating cash representing adjusted provided million; of of $XXX sales of net at million; currency million. by net growth of EBITDA free

As flat is XXXX. XXXX Dollar Euro full mentioned, the X.XX, in our for year assumption

detail, On this of nearest expect expenditures, this A as spent X.X% shown metrics It to R&D pointed of and in R&D note on continue X.X% technologies at net greater capital that presentation. to we be spend expenditures reconciliations the and to will the year. respectively to capital more figure flat XX% the XXXX. our of electrification of appendix important GAAP than in each to to XX% sales is and I of these

our solid In XXXX growth EBITDA outlook volatile cash environment. is adjusted economic summary, generation in for continued macro and a

it I hand back to closing comments. to his would like Olivier now for

with versus XX, with Thanks, performance down the up slide the in of XXXX. a $X.X up constant offsetting billion, I'm Sean. the generating on X% net in sales operating Wrapping XXXX. Garrett the near our outlook. of delivered GAAP X% summary basis, We $XXX currency achieved on very million strong We've pleased of but latest high-end at EBITDA inflation, and successfully adjusted performance

our for the XXXX, adjusted In of We full QX which for FX year supported impact Series $XXX pass-through. by year. EBITDA QX, from solid of of which adjusted and includes flow cash basis an and points XX.X% in inflation achieved cash, dilutive of margin XX A was we free the dividend paid million

into technologies, with one invest our to we above OEMs. and have continue R&D We contracts electrification major of XX% predevelopment new

industry plans thanks in our the of and share launches an grow to growing Garrett to XXXX, new In flat, demand.

$XXX million and million of into cash flow. in this $XXX to full adjusted free expect outlook in adjusted year We translate EBITDA

an XXXX. of the dedication positions I performance thanks employees flexibility and in and closing, even to a and successful Overall, for to once as better XXXX. us Garrett that I'm their again, would drove I'm XXXX our in the and Garrett for with looking all of like, XXXX forward very around world well quite pleased contribution resiliency for

that. with Operator,

ready begin Q&A are I think the we to now session.

you. Thank

session. Our We Financial. Khorsand [Operator first Instructions] BWS from will now go the begin question-and-answer comes Please ahead. Hamed question from

since sorry, in Europe. Good -- good morning evening, you're

meaningful as these in generate just to E-Axle, from new being and see actually the I turbos off, far you fuel are wanted the just cell you? ask a and considered, not market you when to can nominal just First come way news as revenue

a So, just -- question. that’s great Hamed

for a we talk E-Axle, about you or fuel about everyone. talk when turbochargers. not we're When Just correction about talking cell,

about talking electric we are the We motors in vehicle. electric vehicle, hybrid talking plus injector box, vehicle that cell fact whether plus it's new electrified that of are any battery not turbocharger, are products the propulsion system are of vehicle, in or kind fuel the about gear

on we differentiation, technology So, the but vehicle important. a it's This differentiation, about just content differentiation, achieving significant difference between is today not is channel, targeting which are technology two. the there is technology about company

in And the their as our other in working much buy bring the order first solution directed a customers by battery of customers pretty differentiate at to is on where with focus efficiency wave second on of to meaning available wave electric solutions industry customers. those are vehicle, the was to each providing technology to the trying electrification from OEs

second much are wave. targeting the we So, pretty

think that in end it before decade. So, start of as the about production will programs the

it sales past or has been for been you've as any year, trials all and been generating then, as traction really different the you the products there about talking new Okay. And with has but OEMs? far

this opportunities that high to that. for electric else we've we've the solutions which we those electric were which at expertise at have Nobody an said company, is battery speed the is the in ISP. -- the at run we early specifically with mainstream vehicle. I E-Axle, speed which differentiate And think we looking motors very think running I

with a been is of because are into money in believes everyone on working very milestone put our that's there customers. start sharing today. customer going are behind contract, We've world, that a it the is lot that our But which to it. that that we we to And silently solution and with means pre-development significant

QX And cash, my to the going given the Series question allocation be shares? the XXXX preferred in in from was balance more back QX, cash debt last buying of what's is primary increase A

is this Sean Hi, Deason. Hamed,

you as we've two Series us, quarters. in the paid For cash know last dividend A

do best of amount of the the whether You And can that buybacks that we'll to carrying. payment that. expect capital to funds still to continue the normalize. trying think dividend evaluating will use structure when share there, really then accrued that's line we're we be or just we'll the And of from sight get excess

the our V-WAP share XX-day million, then guide to not quarter two $X.XX. you allow of the of does right trigger now, the us higher, we As of could meet But $XXX if volumes a target. come from achieve also of think the price on And midpoint by to do in year. targets to end start a and we see FX, those we tailwinds position the some the be perhaps bit in have

But half again, there's still. a of a there's lot uncertainty the in lot second of

So, the growth unfolds. forecasting in need we second macroeconomic are how to environment see we half, the

follow-up. one did have I

reminded given cost you're you you or are is to through not as what from is far the not is back further Sorry, $XXX achieving, increases? guidance headwinds passing the that ask carrying you as margin mix product me your for, seeing looking holding you, million,

to first, perception. correct the Maybe,

achieve did did. we the productivity the XXXX the margin of in recovery with efforts and great a with think I customers we inflation

high at basically level. we So are quite a

on you had together. of shift If between consider that fact that results we increased the top

So I think we are delivering company. in quite the well

today, at you we If the have us basically things we've shared bridges holding that look are that two back.

impact an one very we one bridge, negative is therefore, a that has FX. the margin first euro, this we much obvious and The report. to exposed are on That's the in

quite a even we down and versus pretty and growing obviously, than XXXX. slightly market the grown been market And bit today, one the PY, market, explained second we we've if in much the has than as are faster is, up that is slowing the faster

more gains the with faster some demand grow milestones grow end little strength talked that will the of about. our We thanks than purse, on have, market obviously, faster market that that the above a sharp we of the we bit in to XXXX

you. Thank great. Okay,

comes next Our Instructions] [Operator Eric Gregg go from question FTIA. from Please ahead.

quarter on the outlook. strong good Congratulations the and

cash question seem compounds one you A rate, that would is at on dividend is a it high the get more out accumulated preferred, given the of quarter high over like last Your holding that. priority Series up Thank the on Just the back? from capital paying What to interest such allocation. rid a unpaid that you.

Sure.

I we're that's considering. mentioned, As something

take We the macroeconomic into I But mentioned have outlook that at accounts. our we're of is to the looking priorities to full utilize as top liquidity. one earlier, excess cash, excess

you. Thank

from next question Chris from Our ahead. comes McIntyre Please go McIntyre Partnerships.

or guys. Can you to margins? good VNT morning the of and talk when about bit the expect a how start Hey, Thanks. ramp pace afternoon you like and impacting little that

say, the And in frankly, VNT Chris, about has to expect into ramp get a XXXX we sure be will increase that So of production. the We are on I I'm When in question translate Quite comment already. VNT VNT started can significant this your is our that seeing does would margin? mean, when I do ramp? the that. Sean benefits into already it further. our margin?

Yes, as technology starts Wastegate. displace penetrates to and the

start improve bit. will see gasoline margins a overall You to

lower gasoline you up. and products. is to product the then that also Wastegate programs and As have does launch of time take But know one some our margin ramp

in engines second XXXX, the on primarily in VNT half. in growth see gasoline launching We small China

and a cost into see you'll into the higher that of market. up. forward I in launch think necessarily benefit program up these being there's margin is gasoline forecasting, the XXXX always So XXXX, ramp in as the programs rates this be have see But going industry in like penetration increased completely creep recognized and future. we If the margins to the wouldn't

margin in increase margin as Chris, think have if did see the reason strong adding very one why was increase margin gasoline on dilution. revenue was side gasoline predicting when everybody we remember mid still well together today, is very of And shell are I VNT a significant transitioning a XX% in we the of spin-off, gasoline we one we the that Maybe of are we and as the – XXs. you addition, percentage the would The that

a about it of XXX right, I obviously, Am units you sort not. if benefit gross point margin like those think on is basis

average. reason of nickel as some be five, complexity. temperature to level two On use the is because burns I product out. gasoline the content has a upon in that wouldn't it's can depending It because it is product your of we're higher possible lower anywhere margin Again, but the from

Yes, of temperature, temperature, monitor same have much details the to study kind impact negative tell but margin, proxy included up, you just into have really already too It's and you you the and exhaust same let a than the of not other therefore me the getting on to a more so would engine. that. the more have you size bit complex like

like think to has XX% growth and like like, relative we inflation a well a SG&A area. ramps say auto about as like, everything in year, were where else, – you If volume very an do pretty guys where if in a get not like And and think to right? this a market and world you Sure. done sales SG&A, base, the -- flat, finally just issue -- do like tailwind you have I think semiconductor on, whatnot, keeping despite all craziness the increase in

company at you Well, look cost -- of the the up, glide-over what we way when is I'm giving the structure view. the and you build

growth flat. have the tailwind to did like with industry stronger [indiscernible]. growth we that are I'm from saying in is we not on industry consultants, Meaning, assumptions the contradiction deliver ourself factor any some with and positioned industry a So of

last when has look everybody history you was wrong. the years, shown -- at and Because that, two

we in share volumes, to industry of would the flat, demand are are an mean growing we penetration be position turbo decided to our growing. fixed to doesn't the that because So thanks standpoint company right from cost flat; that we growing the in and deliver

fixed at that offset, when So, up. look for a we fixed you cost there frankly, reason way significant year, no driven planned increase cost of quite volume the is when be the have would by

on very the the is way which variable, but our cost it's a is downside, to protect upside. to have a We portion also deliver of significant on that way

So about that's the way we it. thinking are

Thank you, very much. great. Great, guys,

session. question-and-answer would Please, conference the Rabiller. our turn Olivier concludes to ahead. over like go to This back I

all Thank with and company XXXX. quite results you. way thank positioned in and the you spent outlook of reviewing XXXX Well, for we've the for time I'm then us you your the the XXXX. what about we deliver pleased

as sorry, for been strong we more the options It prepared have flat financial a we've XXXX carefully are looking be the company macroeconomics. we XXXX, that said call, the reinforce environment in position future. on a very our success could planning the forward and but will you. to on to deliver depending better, and even We Thank give be -- us, to given have

concluded. now Thank attending for has conference today's you presentation. The

You may now disconnect.