Carrier Global (CARR) 28 Oct 212021 Q3 Earnings call transcript

Good morning and welcome to Carrier 's Third Quarter 2021 earnings conference call. This call is being carried live on the Internet and there is a presentation available to download from Carrier's website at ir.carrier.com. I would like to introduce your host for today's conference, Sam Pearlstein, Vice President of Investor Relations. Please go ahead, sir.

Thank you and good morning and welcome to Carrier 's Third Quarter 2021 Earnings Conference Call. are Goris Chairman Chief today Officer, Chief here Patrick and Financial me David and Gitlin, Executive With Officer. significant restructuring Except will as referred and to excluding significant as nature, be Company a other costs items. speaking to by and/or otherwise results from often noted, non-operational items of the other non-recurring management operations, reminds Expectations, call Forward-looking other during the and are uncertainties. listeners to statements the and earnings sales, that Company any The and Flow risks subject Cash provided and XX-Q, differ X-K, details Carrier's anticipated SEC XX-K, filings, cause to including factors important results in could materially provide that statements. Forms on those the actual Forward-looking from review This we'll and discuss for full-year our morning the third quarter financial results outlook. XXXX the for end. at the time leave questions We'll limit everyone one to yourself one follow-up Once opportunity the and to questions call the opened you up question give is participate. for to that we ask With our to call that, Chairman turn and like I'd the Gitlin. Dave over to CEO,

I'll QX was a quarter the you, morning, with in light chain summary Sam widespread QX X. start Slide of supply our everyone. challenges. of another us, on particularly good and for Thank strong results

from ability Our to benefit momentum. our growth economic to leverage continues broad

Our growth encouraging. strategic Demand on the execution investments orders and our position trends, our and epicenter of important remain at and initiatives. secular

We in for record positioning continued are experiencing QX us well backlogs, growth and XXXX.

with remains our address who partner continue team support want to details the our also next on working suppliers the challenge customers us continued I demand. more these provide as to issues. customers and who inflationary been operational thank our mitigating key both in I tirelessly customer slide, Our will headwind thank we and to and I supporting has want to but

up Organic QX EPS helped of reflected of lower results. QX by anticipated, X% and over rate. last a $X.XX QX see team year Adjusted the sales efforts in better was we XXXX. X% up You than tax over of our of the were

critical preserving controllable to price we Given been aggressive differentiation headwinds, while the rising growth. have costs on investments and input cost and

XX.X%. team in effectively and price was margin manage more HVAC cost that reflected Our of a segment

and is reacted impacted fire mixed. our The team also business refrigeration but story is most aggressively, security is it Our by chip shortages. that

While growth the be react on gain and disappointing position we enough right organic both initiatives, to XX% to the costs, am taking a drove strong for All-in-all, year the for XXXX. is and and strategic segment to on not actions aggressively resulting traction confident price did shaping I segment team margins. that up Tim Carrier. us well solid are this in continued

expectations up to from XX% last about XXXX. year, growth over are raising to XX% our organic top-line XX% indeed We X% over

indicated, to up are deliver Despite inflationary of flow. raising points over generating expansion basis projecting We XX% while what challenges, end about on $X.XX range we track in also free adjusted over cash last previously now margin XX X.X this high remain of EPS year to year. the we approximately billion

forecast to to now Slide chain challenges million. full-year in about our significant. pressure about increased costs, Turning chip supplier XXX and from XXX escalation, July cost input logistics material increases, are price Between raw X. has shortages million supply The

We are supply day. a Tactically, and both war tackling chain have strategically. that a XX this tactically we situation hours operates virtual room global

our resources on-site significant of are into chain suppliers. management, whom supply additional We devoted many at have

with actions supply chain. We this digital tool. port have routes we period newly redirected Strategically, ocean from avoid a implemented to extended emerge resilient a more using taking freight delays to are

of For of critical minimize example, we dual points single had are XXXX working components. XX% roughly to sourcing failure.

targeting circuits are securing XX%. we XX%, over Integrated we're on chip our OEMs focus with XXXX acute have directly with end and working will We our supply.

cost complexity. cost and low remain and logistics to commodities certain localizing also are We reduce

this in investments increased automation have by our year. XX% We

by have a the automated of end this X We XXXX. million year, of million the by to hours X have we manufacturing will more and end have than plan

Our investments our drive are and tools CARR supply and and provide we productivity. proactive excellence across in deploying visibility drive more factories digital chain, to actions better

already expect will increases announcing of we others our inflationary have is investing side, price important playing see XXXX, that and on offset a X. headwinds focus For managing end implemented the be growth Equally at on the by offense by on minimum remain We on our the committed to progress controllable we Slide this we that be G&A. year. including you to cost and the and

and and leader in we star a Buildings, north building In be expectations. to ahead million chain in XXX consistent over over of of Our sustainable, orders full-year pipeline intelligent cold our million in healthy, remains world Healthy have the safe, solutions. XXX

We K-XX continue QX. including that to than pipeline a XX% see strong verticals, with traction is in higher key

speed customers We Globally, recent are prestigious intelligence, heating now well-positioned to our XX with Infinity Over the in the more XX% premium of are North commercial years. needs. We Green driving address by differentiation. heat Expo our were sustainability pumps. sales share now We efficiency. years AHR our fair heat XX% residential honored than pump X a up project heat innovation we our at pump within to with of to XX% are to very XX% industry's this award for sales win America heat plan be advanced energy and pumps X most from heating ago, capture

in technologies. air-cooled by lower improves Europe. our legacy and is our our this year, heat versus energy new to global than pump XX% up we It's chiller previous warming XX% potential earlier example, platform customer's For chiller launched efficiency

and were sales up to for for XX% it this Our the Abound, contributing platform gains. And through year-over-year connected tissue share pump QX, connective is chiller heat intelligent buildings.

technology, newly detection, from and are healthy, intelligent, Dr. in Carrier the together. this it which partners Emory with Carrier innovation all it Emory fire and with Boden visited and solutions, facility sustainable HVAC, and ties suite full facility. of recently digital I his at video healthcare example, automation systems, management, abound opened state-of-the-art For building Scott access

encouraging. on progress equally Our is Lynx

and increasingly solutions. our Our adopting trailer customers monitoring truck fleet fleet connected based, digital shipping are subscription

signed subscription one monitoring. benefit with largest and The less costs. energy and customer to U.S of and telematics portfolio the consumption and year-to-date, and pipeline. book our increased we in an have We agreement order growth the fleets strong lower loss mid-teen in will refrigerated re downtime, overall seen fleet efficiencies, have subscription-based for products a We recently from provide truck and

We share growth I geographic more year. discuss continue up XX% aftermarket gains, VRF, pillars growth to of digitally-enabled X will which progress to aftermarket year-over-year. with double-digit Slide and expanded QX and X. see are about revenues, this And on increased tracking coverage revenues were our aftermarket recurring we on

broad modifications and digital other have parts, is spare of including fixed preventative break Digital aftermarket enablement upgrades, foundational. remote launched We and midlife monitoring a solutions, repairs, portfolio maintenance, services.

Breeze, high-margin part platform focused e-commerce recently National residential capturing with Account our commercial we in on abound, to light a addition launched and new HVAC. sales In customers

commercial on HVAC, remain continued have levels and national service fleet. under Tangible to contracts progress top-line Our strong strategies on track X-year refrigeration, in growth highs. all-time BluEdge are coverage service service XX,XXX well sticky a refrigerated largest growth we signed In and year. this contract chillers Australia's at we driving ScottsRL, beyond. transport organic XXXX with XXXX these in us is for In positions

growth our is of component acquisitions. Another

this great As X, in are area making we well. you see slide can as on progress

on on digitally balance sheet including both us enabled deployment, revenues. offense play to capital focusing strong Our M&A, enables recurring

monitors carbon Kidde, is flood, offerings has smoke safety of agent alarm further a alarms, broad million building more systems a offerings insights. and to productivity. center technology offerings product fast-growing portfolio have love alarm. sought-after which generated has our example, smoke, response security real strengthen can a is with pipeline BrokerBay, heat, across we we give Together solution management Cavius technologies Agents as the power residential in regulations differentiated as to cloud efficiently very complementary provide the communication, real showings, heat management XX and has optimize the complete ecosystem innovative residential Together, ALC us XXXX. center our smallest including we cooling in acquisition and the to photoelectric estate operations. data Denmark-based locks been In fire Cavius, pushing cooling announced showings world's customer both for Supra connected combination actionable nLight market-leading market our highly support provide capabilities software ALC systems control dissipate to data leverages nLight heat. monoxide scheduling, BrokerBay the tremendous. Supra Similarly, and and opportunity high-market innovation an range we monitor globe. For enhance technology adds and power across enabling The complementary Last credentialing the Company. one-stop automates fire digital and the vertical. that loads optimizes our system safety brings effectively of shop expand an is our our share innovative, generation. mobile and that that integrated globally. Early capabilities. property estate attractive week, the the to improve rack such been real-time and used and business. residential to to

We M&A turn remain continue to Patrick. priorities. on let pipeline over build out and we me our our it Patrick. strategic that, With focused to will

comments Dave. outlook. turn quarter and everyone. with I'll Thank on morning, about Please start X. details the you, Slide our good provide And to

offset the in year. realization were input segments up X-point and results quarter constraints the Currency backlogs. $X.X Price but acquisitions, that of supply top-line to GE and another on shipment sales lead costs. by As were track billion to to compared chain expected, contributed All added impacted very record were was delays, two and Sales for of on growth, last availability higher-than-expected over-deliver QX. growth. better-than-expected, X% points was increasing to mainly tailwind but similar about was to

more the about the a cost was year Nonetheless, year-over-year operating we impacted XX.X% containment lower HVAC activities. of margin XXX residential was a sales of to points on strong basis absence unusually points XXX compared from X%. up the decline quarter last was last Given by comparison. but of year, basis quarter down The sales. last about second delivered challenging year's margin this had organic performance Adjusted growth

our price inflationary offset few in we but throughout chain. rising our As for year that outlook in negative with address costs balance modestly and price supply actions I'll the I'll to the the of cost pressures pricing additional expected, share a respect slides plan was quarter. to

in increases. Some Security also price of $X.X from price week, X than and higher did billion light were Refrigeration double-digit & price increases quarter which these in Fire this are timing businesses million and residential as up increases HVAC given delays earlier America. through $XXX additional year. year, North to and QX months. around was including shipping cash shortages. commercial expected Last Free are Inventories planning we our not this in component recur the incur payables flow announced benefited

of and the on year. discussed. this shares many QX track the In million Finally, the we million repurchased we shares we about for XX year-over-year points to quarter in million EPS a appendix, about the included just X.X remain I bridge, $XXX adjusted repurchase summarizing

enable You benefit in items process will the assets to In tax year's sale, July performance essence, charge note absence of discrete you actions of cost earnings. legal that million the balance the we're liabilities not reflected note operational and GAAP our On now for reorganization is 's pending last $XXX as $X.XX guidance. included temporary held This entity benefited our and sheet, impact Chubb from some in of assets tax will QX reclassified from that and in of included liabilities the sale. separate liabilities. the have tax containment Chubb been triggering in

net we Chubb. from sale expect to about previously of of communicated, the still $X.X billion cash As

transaction we close or estimate timing, to the currently to in As January. December

down last X% last X. were the light segments result versus X% high sales at over the the HVAC about we is Overall, X% end residential organically. down single-digits was up quarter how movement about about performed, the starting inventories light decline year. North continued sequentially The commercial of the saw QX. movement inventory are field on at was Distributor from look organic an Distributor levels commercial about HVAC were business X% better-than-expected in the Slide X% sales year. and the including about exceptionally up second in tough growth now were American on field commercial year-over-year. XX% given XX% HVAC, compares. now quarter, The quarter up residential that strong Let's

this and down up segment XX HVAC remains points of XXX-basis actions, were from XX% inflation. adjusted the track offset to the cost margin As margins and about impact Margins expected, second benefit to tough the the residential comparison, cost about were last pricing on quarter year-over-year, bips driven by a generate about additional year's the from operating temporary year.

Moving global was in were quarter, organically to continued. container. X. both and the XX% in transport demand Sales growth strong as on slide trailer truck growth up Transport with Refrigeration very XX% up in about refrigeration the

and to rollout China. vaccine refrigeration XX compared bips mid-single-digit the was decline from benefit of about was due Margins were chain the quarter. up as to quarter as as in was year challenges, supply benefit the a labor price continued by about business Sensitech the Our up in down year in sales Commercial and slightly XX% actions. year-over-year to well increases, temporary benefiting substantial from from higher offset last last the timing

We meet costs continue in to to incur demand segment. customer higher this

we're mentioned, range, segment operating and expect to in this in now lower the margin be they've XXXX performance mid-XX% than previously As margin we expected. disappointed the in we

Moving on above field Security sales about Organic up X% slide X%, & to were while XX. was grew as the Fire products for flat. segment

benefited margins up. was compared solutions down sales, business, Access the and product of represents up margins the temporary year both sequentially, high-single-digits. to expect we XXX to segment fire this points were Operating for the Within last mid and about was year. basis the [Indiscernible] for from slightly as Margins residential fire year, segment bps XXX last cost fire which overall commercial about in be were industrial XX% the were actions. down continue to while up

review XX. the we activity me on third the let quarter saw order Slide in Now

compared in and quarter orders comparisons. last as our the but strong tough the up year down light up year. Within that up single-digits remain Backlog residential XX% Commercial to sequentially year-over-year. high residential in XX% year. higher XX% on see, can and and you orders positive about that about orders this residential at orders despite than As were last and business remains backlog X% were XX% business, the commercial so light some third in or over the recovery continues. about HVAC increased commercial very is sequentially and point were last

for QX achieve fire. intake Refrigeration remained were organic intake For sales were strong the exiting & Refrigeration, and high Fire up order industrial The position single-digits growth segment in year-over-year, continued organically. to for in expected global also for backlogs orders to solutions truck strong Security Field solid segment with growth trailer XX% driven access orders Order the XX% business mid Product year-over-year high-teens the growth year. double-digit and up strong. up activity by order remains Europe. and the to about

up security On refrigeration the in in the except were right, you see down can orders mid-single orders in China. in are and geographies that fire up while all HVAC China, the orders and were In in double-digits. digits,

neutral year, higher costs. sales which outlook. guide XX% expect offset cost versus prior XX% updated last expect Chubb our realization in we with XX, the including by XX% quarter, and until higher slide input outlook now we costs our XXXX, outlook. sales to about QX. what move to benefit transaction higher now are higher we exit Let's than The price To to organic is Based the price positive the the QX is of reiterate being in our to be said closes. organic up price of on We QX backlogs, for in performance, prior

expect prior all be an little million carries XX.X%. continue to about a of QX $XXX d outlook benefit guidance. adjusted EPS an tax We discrete over consistent investments leads incremental are $X.XX Full-year about adjusted of update with expected XXXX of to $X.XX. so over, operating this The to margin

$X.XX, you build note Chubb thought XXXX As would we Also, the income. $X.XX included that be non-cash if above range. models, have XXXX about annual outlook your earnings, a the of pension in we including represents that would

expect Slide guidance. continue the midpoint from free current prior about our to $X.X to We the be of billion. guidance the to shows bridge XX cash flow

driver biggest tax As price offset as adjusted by rate, you can is see, costs. the is volume lower-than-expected the higher

absence supply a last XX% XX. back and In of quarter, mostly growth Thank our offset about and incremental the EPS demand in the we items this managing X unusual note you organic the expect investments quarter. -- to of that, all $X.XX strong and of fourth the double-digit year very last you with were to months the fourth it in year's benefit of the in to all. for supporting challenging of strong a Just first closing, With year I'll adjusted Dave colleagues turn growth. environment. partners Slide chain Thank

Patrick. Thanks,

We are the the we and quarters as support and our quarter open our with for very team's XXXX, challenges now ability in we continued up our to are pleased way beyond. through of fourth navigate supply drive and to results customers performance confident X chain remain we'll With that, in questions. this

question question America. And that going thank ask follow-up. to you. X first Operator remind And Obin and you from our Bank instructions] [ of advised Please come be to from Andrew we is X

Your line open. is now

me? hear you Can morning. Good

Andy. morning. Yeah, Good

Yeah. Good morning.

Because Carrier numbers, it in fact putting on Just very, of like targets environment. inflationary your optics actually to is this seems pricing your a that XXX question very you're despite approach missing are strong. the you're but the philosophical

incentives? maybe plan you low do seems are and very we're inflation/deflationary guys how framework the here different was What the changing in Because to thoughts? for the it are Management Board it? this think world. about What very, So a clearly change that about the environment thoughts and designed

got and the a one-time doing, we seeing we we're Yeah, inflationary Andrew, what XXX is a things year such add, which few and right. productivity you decades. thanks. haven't side. all-in And benefits this were number. some on cost that seizing were a we last year, And one-time tortured let an year furloughs Carrier you're with into some where Patrick takeout’s me as through in was absolutely doing year bit unique we what seen went that other And and on that pressures is is it had happened as it start last

sure which the pricing also make can, aggressively on price-cost to related really and things we So, that are -- doing we we controlling to controllable positive, as as is cost. all an much we've fixated means as being that on can everything what organization are

So, Carrier driving lot we we we're best are productivity a commodities we're doing Alliance; managing with can. as

do in next to and unique didn't number step go into where we an as The sure environment, that lose make XX,XXX every to We on having and cost obviously control can we'll still have at people never focus that doing Carrier What a But make focused in which that forward. we some is will that it where DNA of control underlying on that then February can is we we still But the will very gone, the of we XXX sure organization re-frame is reset, the our this we mentioned bit stay the sure Our stop. of year, is everything always positive. as principle be where are. and around given Investor back thread. underlying cost form Day XXX cost takeout on Carrier we everything will there -- world to the we a XXnd part making of Carrier. going Chubb side a will is day look be and context to price

'XX question Thank strength think sales What's the I what early of into you. in [Indiscernible] has And should for sales how indication very the year, rates because then was. between existing given and connection just of unusual was, terms September, this how XXXX, in HVAC? season next the October. about long thinking backlog think about and to the [Indiscernible] So orders about specifically on how orders different been we order year a The

the we're good forecast very the would look now at for we than about so time, broadly, where we backlog start record almost this order, at the is backlogs. And the year about of normally Andrew, very, given are thinking booked our for rest next as early portfolio next I year. record be in sales we this more terms our year, we feel of you across think if highs,

in residential up about think we're terms we're XX%, sequentially, of backlogs, our year-over-year. you XX% If up our backlog

of So, we're at bookings. very high level

we is across making challenge keep our encouraged much continue portfolio. to the that Our pretty the backlog we sure very demand, but very, up with positions by feel

much. Thank you very

you. Thank

question Capital And next Markets. thank from you. our And from Deane Dray comes RBC

open. now is line Your

Good morning, Thank you. everyone.

morning, Deane. Good

Like HVAC stand does plus to start that I light out. XX% commercial with orders really

comps, drivers, underline in an but rebound helpful. how is catch-up? the it this of of Is be Just much might part be talk it That'd nonresconstruction? about COVID

replacement, the of What Well new. had demand people this there's easy we as year, of bit a said comps a coming strength. commercial coming just -- forecasting clearly lot lot that to XX% the pent-up There are we were we into year. reminded a year, last compared was out like of it's but last when XX%

strong. places We Some of key in been of strong all has encouraging. been see have verticals year a lot warehouse. the be that K-through-XX like continue demand extremely to

think vertical. a online. have year-to-date focus XXX sure restaurants us gained support we've dedicated points on coming customers. the share like sure we I to by we are It that customer. back support It and Retail driven to great of part And basis to that cost that without been of making whole support hasn't gained share. ability we We our but commercial looks lengths we pressures, input is gone that our can in make to

when So, more down XX% which we Field quarter. the is inventory all when year-over-year, order at you the well than bodes for different significantly, look future. at look is variables, the up

sequentially. up we backlog to our range. is into almost XXXX price and double-digit end-customer XX%. a Our movement It's announced in our increase of just Xx distributors the remains from And over base up up

commercial. like light So, and to a lot

demand it. It Any but conditions bit on certainly it was pressures like China? is. overall, -- on? then as a give operating looked Got sense you of And were a HVAC that what a would comment you just comment you the and can more us better, follow-up,

still area, range. there for of orders up mid-single-digit watch and China orders rest attention, one The seeing the been Evergrande HVAC see challenges. would the what were some some did commercial we're have orders tailwinds. portfolio given is The HVAC in that

over news into strategic China we us. China. be of it's term It's Look, for the in us our that lean for very continue important to a China -- the good think is long a term. strategic, over and market the sales for X% very to is And We I China. market long want

the sales. acutely X in at impacted to X.X% percent Tier Tier most X, situation, multi-family that specific Carrier residential, It's us look probably which very Evergrande some a very, of the seems of on cities is for our that of sales is be area. you focused small If

think I issues. a very you some [Indiscernible] on look real we're China, Overall, part of important well calibrated So, China. when of is well those at and estate

going think overall do the government the I that we China. is to incentivized in overall support industry. be So, to industry, estate very well-positioned feel But real

That's real helpful. you. Thank

Thank you.

And Thank Barclays. comes question you. our Mitchell next Julian from from

Your line now is open.

morning. Hi, good

segment wanted outlook to just America. the focus a Just for on and HVAC a bit residential more your clarity on in North HVAC

mentioned quarters, channel, sales are down market distribution that the think bit you'd order's and a the Maybe around very how any the couple inventory with comfortable QX, little thinking in slightly us the business I major of up? next step down concerns more. the levels feel down the of you're degree help you understand how your in for in about that coming

in actually XX. our splits which is QX single-digits to did sequentially and a be really as prior I say are going at second we Well, inventories, the even probably than X% look all X% October, housing down be fundamentals percent less there's to backlog, The and Patrick at and of in and us. X is what We the North tough Andrew, strong quarter. comps thought thought thought. for down over mentioned good down when the going to be it significantly in continued We had was starts for third to news years. over range previous being movement this versus Field up What be us is up going we end the down to mentioned year. the that was with is range. last is the significantly year -- be XX% orders to for the means was us orders, continues Look, down second half Residential We up continues year-over-year. to +XX% And quarter quarter, previously half Resi low that look previously it would to be positive. in that, to some some HVAC encouraging couple even the America was in new more underlying Julian we versus

into push home the year for slightly seeing. be some challenges us think give lot the supply home underlying phenomenon chain factors shorter given some and life. A rest work those to as us like from they are go I into units continue out next of going year. of some we having But to confidence that builders of next the there's the a

when we give specificity. we the right for continue. will lot So, have that demand get a into supporting February, now, been the factors But underlying of more

Thanks. just then my question. second And

encouraging and extremely distributors lot keep we the there. inventory us we continue the work that trigger now at year, what And look questions very cognizant. been about to closely signs that I to apologize, a be think with I 'll naturally be is -- balance low had with in in year it going I them. our teens. Julian. supporting next levels high range as comps. up we again, for up it We to resi means have We're know the are be was those that that full go in But thought that But said we being of teens. looking does it you when

numbers catch great. sluggish volatile then builds us on refrigeration, extremely refrigeration, on help That's up the and particular, And price and can in you'd helped and margin cost maybe Maybe right price you orders think market quickly got transport disappointing that how in out you've understand performance. managing aspects where how called now. in increase you drive you're that that

Patrick here. Julian, Yeah,

good So of are there first things all, happening within that segment.

the performance growth commercial refrigeration margin was transport, you mentioned, the about in is growth, sales noticed CCR, as very strong flat. growth. we sales So, strong double-digit the disappointing But given

more timelier focus now would better also and segment aggressive and that control closer, on side, say but in increases. especially cost And on being a price the is a so, I

backlogs significant year started changing that there. have given to on of pricing. ability last Those we but that at now. end mentioned the is You has that pass somewhat limited us

ensuring are pricing we opens change. up, orders as and we one, for we that the orders two, that material for so, year, higher, these for that to retain these adjust as And raw are orders flexibility prices on take window the process and next if

for And it's and team. a the Tim so, White significant focus

Thanks. Perfect.

Julian. Thanks,

you. one, next next Research. And from from thank And our Nigel question comes Wolfe Coe

Your open. line is now

morning. good Thanks,

Good morning.

times. Interesting

commercial revenue, obviously, in orders. very XX% So strong light strong and performance very plus

a lot detail a you some weaker But We I'm a that, weaker run the good. be trends quarter. on the Any when haven't applied whole but the there little market now. I'm rate. compare And there seems around wondering there, than to just of Maybe trends, had bit market. on if color would the shift any within context supply then right applied, was first by chain. be share that half it wrong got much

at look in we gained quarter, year-to-date, share Light bips it's think we've share. look to we just of do When XXX but a that hard at Commercial,

our upside and We're that Overall, was of digits by line a strategic swing, the lot it's aggressively lean Europe HVAC. we our core do for like that for after. orders been equipment portfolio, index. that us look, XX%. look is We're That now were products higher. really than that. up very architectural think XX% consecutive sales China differentiated, and XX sure With we a of Those North was higher can rest up So there. new can we that grew the a commercial very there very It's very course. making up of America like we then strong. in the continue our aftermarket we've ABI at mentioned double in up up has the gained and a thing go were controls encouraging important was the signs were but market in for encouraged focus been and billing commercial with for key that's sure high-margin, we spiking months. been with as deliver. there's higher. continue turn driving and market And Patrick over than high-teens, mid-single-digits. you not a we higher to X just business. overall, well. It's And distributor HVAC, keep orders, world will those really working to commercial bit down HVAC. share Orders for were make us we HVAC, ALC in business. important with -- Light a was applied any Commercial. us balls, we bit really base when for thematic that

residential, And Dave. we of then you into And pricing increase getting go price pieces? price stick? much increase? you think from the what as what year, that another what planning you enough premises do of you are of price pricing? And How will in are kind will Jan XXXX? range stick on reaction to or kind the X, Thanks, [Indiscernible] headline next that do offer offset assume think Well, you patient? for is and price So,

transport, week we will short difficult, announced but earlier think this this for the resi. of end inflationary same X% number quarter, with direct of have the would question is January price are to a of realization. We're our these about on we always seeing. we're have conversations seeing pressures than customers the we discussions XX% the to We because and up actually X realization have probably earlier range These I the that higher direct increase see answer which last is yes, price effective quarter. in historical

year. we've the year. So, prices seen that resi very say the by these that out this encouraged Carrier for at And try think stay stickiness business -- to most next the us on I we been price increases. price bode well in go as front has effective I will within we're ensuring would into we

much. very thanks Great,

Thanks, Nigel.

our from Thank Stanley. Josh next question comes you. And from Morgan Pokrzywinski,

you me? Can Yes. hear

Yes.

Yes.

Yeah, for Thanks Great. the so. guess I taking question.

mechanically Patrick, you ones go there sounds sequentially. inflation of as okay into the out other made locked will that we next flip higher Do first year contracts you the in enough kind question, to first you the already around reset earlier the cover line the industrial and quarter? you're that that'll of It like that were or you now you've price mentioned in feel out talking over one the have First quarter in but in into about that there wrapped of 'XX have right reset. probably like XQ, buys

I'll hedges than morning. input last headwinds, benefited planning current continued year. the that talk to which thoughts from quarter-specific. being rolling and cost we including XXXX additional price address But actually good purposes, increases we're the our Josh, are about for off about rather

in light As Dave up XX% residential announced in this increases HVAC of just and commercial. mentioned, price week, to we've

is year. that seeing think $XXX year headwinds we're this safe I input million that next it say the assuming to we're cost exceeded

And so, I costs. think Dave year this are headwinds mentioned in his comments that total $XXX input above million

than this businesses. be expect and additional million about in for The additional we of we've of next we If year. that the excludes to the have is RESI that So, commercial carryover it we the taken in carryover XXX remainder announced that increases price that actions pricing more and year. our to will week light that $XXX increases at this I that be price the look and excludes -- announcing implementing

And our goal least cost remains so, neutral. to at overall be from perspective, XXXX an for price

be our want in But do agile what need takeaway very that. we quickly doing. we on this better to team are input course, key able than for is environment, to and the Of costs be to react

And commercial Dave, in delivery order-wise, project That's on quarter were I pretty then commentary factor. earlier there. tougher. I would've it. chain back getting the the helpful. a on or Anything Got held the a question delivery-wise are comps the or earlier like little the business, year pushed get a making orders guess supply out that strong. appreciate

how we growth Just wondering the commentary this with square the order sales up quarter.

address. affecting at of a the some look continue say do does issues, of Charlotte HVAC initial ran of if production just issues ago of were that challenges type business facility, related supply here you about America, we chain had then issues. bunch would a to XPL a out that into we then in coming supply Commercial as lot some our our which some Yeah And Josh, I chain North see those output. year the we we for we

could customers sure the when, get that. what been the order's the would if to clearly expect they to in chain recover from but with to quarter higher know to they're start we their closely didn't We're supply factories we issues going sales have of start tier-X recover. that make to that our our have as working So, strong, it's one

of luck. Best guys. Thanks, helpful. is That

you. Thank

Thank you, Josh.

come Sachs. next And you. Joe thank And from Goldman our from Ritchie, question

now open. line is Your

everyone. morning, Good Thanks.

Hey, Joe.

Joe. morning, Good

sure talked XXX, Carrier touched pricing year, Carrier I for we've about just the on XXX included a price we've know increases. got and hasn't lot make next to this cost straight but

taking year, And these than expect pricing so, is is organization? the the way we more the below to next think but benefits the increases were I I that your of originally offset somewhat rest think being expecting by think that we XXX through you're should about

that of worst-case. think, easiest I a be this announcing of is Yeah, to to be week And intention coming actions pricing Their weeks. way Joe, this announced that price over the think from is the 'll price and about point we view. overall explains some a -- debt neutral we cost the in

And however, to input and course, so this driving XXX. Carrier term. most would drive organization And is net, we anything business as from in gross continuously include efficiencies and to offset invest And such or to continue do to thing entire mentioned Andrew merit inflation. is that Dave earlier we in the on of -- the or cost question -- out focused in costs our us, first help enabled question Carrier long the first any that the as increases, XXX measure is, important

I I I open wide inflationary is year on And the eyes news is think What add would pricing Joe, think good accordingly. is we're the with team next that our going into pressures.

out, clearly to and coming year. next helpful. Got is cash of have going of some use, the And to proceeds offsetting I put associated your some just thoughts the to it. capital dilution on any That's with with use Chubb question you're updated guess for priorities other Chubb

last in mentioned say completely very would I Joe, Yes, quarter. consistent what the we

fund from expect growth, share we dividend, we and shares million of at to share this quarter, growing of so a And of And share we've growth, expect funding through debt capital and quarter with then we about the XX million leave a this said -- about shareholders a of authorization last us $XXX a buy we $X.X about with about announced that's of fund to one, last is repurchase. proceeds, repurchase billion. year. also remaining repurchases. the then prorated would XX end we've with to billion priority, would year, with to would authorization months sustainable lose this What cash that leave we We first what Our inorganic structure through from said down point-of-view this over a the But EBITDA redeploy mentioned returning then pay from year. Chubb. repurchase organic $X.XX us the point-of-view, calendar the XX at end that, still will

you that's some But And inorganic why little acquisitions well. course, its We've mentioned, So priority have some capital are number are covered But in that of can idea them X, including And put that to an significant as We of gives the that we the the growth. acquisitions some of bit share the size as made larger pipeline pipeline there slides. acquisitions. we of in have growing a obviously, funding this sequence work. for I the repurchases. we growth, in year.

of on working onboard. getting these And we're some hard so,

[Indiscernible], anything?

helpful, Very thank you.

Thank you.

from our Stephens. And from comes you. question next Tommy Thank Moll

line is Your now open.

for Good taking thanks questions. my morning and

Hey, Tommy.

you be would sure out to XXXX, big make cost, think obviously, if for anything boil etc. down else in going the be Any divestiture we make reported all to it to the is XXX, still about think about, those between a Chubb point actually operational aspiration want but you fair about Carrier If commentary you talk to sometimes versus P&L. out a to core XXs Appreciate to today? for around that the then all price conversion. we high core for what's would two sure one, And want point delta folks,

where that line. an impact we're bottom course, full currency through element important not the the and price pricing year the that one, two falling is then made there the is cost this whole well Patrick one, is $XXX important of earnings of Yes, this of million understand moving much and pieces get contribute. lots Tommy the particularly And over some of year role what's playing in year, adding an dynamic, we've here. for year. don't us acquisitions year I conversion. Yet this of I

has absolutely on high good XX% But bad. what range. that the side, might the depending to get and we different. No acquisition we our But work in be impact into and mix course, That year, we that being number. absolutely Depending any going do view, exclude to significant Of something a changes above we because would XX% to earnings for slightly still point at an that change. conversion from or on target want price it and said, negative costs, that's operational target towards. next don't I'm conversion on operationally, on of

Thank you, Patrick. Great.

Tom. Thanks,

follow to big question here. Dave, a picture I wanted up,

point? making to is process priorities envision what flexibility? G&A as that in quickly body maybe transformation or fronts. that terms remains improvement this that a the lot what's curious, your of of you in in the comes big But of of I'm of pure big body a work next of to mind you are moved on at one with business mind. changes the play You've pure-play year just area for front some

continue invest you year, saw We Tommy, all this into input and cost digital. on continue along continue and to despite year. growth. we like challenges, Day core journey. laid And that the to geographic out playbook first of continue the growth. last then the we expansion to Investor stick revenues in the to going lines grow of invest to really of XXX like million XXth, We're aftermarket the our three that recurring lean VRF with a at growth February would in we're that said with and at our pillars adjacencies Continue caveats look to in ending we

from years go revenues, a us. next and theme the for more and come. up recurring of thematic that portfolio across have reductions. We're these transformation is closer costs within for low-cost to debt. be that to And and a growth X aftermarket centers to G&A of on be. we've us. billion into certainly, excellence, sell aggressive more XX number for these of to pushing into more We We've to major super be said Simplification focus Carrier continue We XXX global we G&A be will would Chubb will excellence. year to way we going it very is, spun the our with work going long billion and what fact on to centers despite is gone set now costs organization. when the the debt after will net end that it that we itself of the net and

a So, great inorganic is our ability to in play offense and growth, place. in organic

to existing So, where at really we'll can we continue off. look complement play our to portfolio

do in to playbook, And in focus do, like doing 'XX to to have to going our our going focus. and now were our is like we What we so, we transitioned be best-in-class everything we doing said we from do. what we that's beyond. And

Thanks I'll it, turn and Dave. I it appreciate back.

Thanks Tommy.

our question Tusa And you. next Morgan. comes Thank from Steve from JP

Your line is now open.

Hi, Mr. Tusa.

I Josh wrong. [Indiscernible] understand But getting

Yes.

for absolute the realized an was the total on -- quarter, what on price [Indiscernible] just in that basis? So

than significantly think of QX, growing in pricing, QX. Steve, XXX better about $XXX a can in million to QX, about You

you'll take, me and points, or QX, between And asked be after QX, a started price we're question, we QX, above realization because you from point. give less so, In and the point-of-view, than half X will recall from but, pick in it bit we But price be and seeing of to overall Company a realization. course, cost we've up, of -- little at X% of input neutral expect been We're do -- X% the increases. QX, trailing price a in cost

Right.

picking is it so, clearly -- up.

of million $XX And I had XX, around RESI that.

that RESI I in the about exact know QX Do QX. we but we that's in RESI. we and same the expect -- did Steve. for don't QX, about We QX, can realized in dollar X% amount, both what realized. think

that's of million, a a try in mean, saying -- big there at now up more not follow parse couple to to cost on -- And then out like you savings, kind by of bridge year? shouldn't we statement, of savings was that number a kind been a year kind just sense. that's Okay, next if blown of that you bridge happened, that as Are it's question. -- for lot makes as thinking everything pretty still because and will, I that's little next carryover -- mission of this lot about for $XXX Joe's least. of the cultural in kinds far Carrier dial those a a concerned, this of mechanical stuff of But is XXX? it's up just really for

Yeah.

me can Let give then some specificity. start and more Patrick

XX as change. when quarter Carrier with we're costs some costs buying the this chips an what's said did When in We were pressures we the Carrier container foot be have on to war color overall the a seeing, market, seeing by it if pricing get the tried we're our that China to of give been there input XXX. you as management that have it commodity will have it spot can out as entire much on see costs suppliers. times and year. really specific next that, Having U.S, you would when focus in see to clear you inflationary on building, room into step affected we're the XXX

out being You would the rolled see across world. productivity

how year Carrier next said, like what thought. will So, to do Patrick than we itself going XXX minimum positive being specificity a this we price-cost lower we're intent. that number give on is want you cost to the is that? inflationary But Patrick, pressures carryover, to at add going again, price into offset our year, with and -- clear

Yes.

intend not still we to year. drive next -- our this Steve, cost has think, to changed. year out I compared That

year our expect this than conversion would better be we equal, to those all so, earnings And next year.

makes a -- that makes sense. of That lot

to that kinds to of playing -- kind against these right in sources way are going costs of is, it? higher better can environment, that that. you costs in for All being dual-sourcing, the because dual-sourcing My I you're a of at look are other. a availability. like your each stable like on kind you like said, Just to higher structurally that environment it's lead when this guess guess off margin them actually, that's etc. trading follow-up more you Is

ahead. Go

some go shortages not we have Actually. Because gone. have we there to that are do otherwise, components, sources of of would the to

today And have our incurring so higher constraints that's normal one just well. of some sources are the we reasons as why costs because some

should clearly, a we cost help having point dual-sourcing Some environment, more stable a are from year but associated of in more of the view. this with see increases that

Right.

when pay say, when add gone million, then an Yes. used when hours better dual X demand investment feel you an we from, I to to But get half that hopefully, to have starts back out that's will But to X you up much about second get million reduction at sources, of million we back as a the there's set an more this then the Steve investment. we way year is say on that there look next supply you year that, investment. and we've is to what automation we're there, ability would on year numbers happens look, year over is our cost investment imbalance really towards our the seeing. get

Got of not table to kill then going distribution a I sorry, anything The much like in something sales resi it. much though. believe or that is is XXX things? investing like me. of on that people did base how that. How versus rebates installed quick hiring and to the And of X, myself investments, will, like that, stuff you in or you're that commercial that or like kind activity R&D pure dollars if in and Sam of

it's For this year nothing.

it. Got Okay.

it. Appreciate Thanks. Okay.

Fine.

Vlad And our Citigroup. next comes you. Thank from Bystricky from question

open. Your line is now

guys. Morning

morning. Good

Thanks run that question. ground for a money here, Josh of a my Giving for lot covered his there with pronunciation. obviously. We've taking

issue be back Obviously, seen actions in some terms of to we've now and to going labor. growing labor U.S. the activity. in availability Just a labor seems strike

terms risk availability about how disruptions. inflation labor general. talk and wage potential you're in seeing can labor then you're And of broadly, the thinking So, what you in of and about overall more relations

confident real have very sites I Yeah we've very, in wages bit and stage, union structures the Vlad, challenges our, of some we in the continue we areas some And manage our we a to close want work the here, partners we'll that couple people we for also our what place right our to environment put output. And U.S. the stay had very say are outside in XX% with -- at And of to But we've U.S. here relationships have we -- that. are feel union the partners. have close then where the would create a we set and people bonus our we've U.S, we labor with in rage

the helping I results. And showed the sense lot it production That's around helpful. a -- think Okay. incentives with seems makes it's of for like

to Just last or I people. think so back following XXX year, up, you've I added think sales

ramping positioning the been how approaching resources you've end talk we're today and terms sales thinking that you you're of whether a seen productivity of you can talent and while, those force more about 'XX them see opportunity broadly, in and incremental they've there? Now onboard to the about continue resources to just what from incremental add for sales

the up And in in certain very came salespeople. all XX%. after of year added very grow additional in our is end like North We're to added the results investments were and additional them. we've by going X%. things R digital been We've and in areas and growing we're all good people we sales that to said And very we Look, and thinking We've with the done, China D, We've contributing. that's sales. going added. sales organically folks pleased targeted been very focused in we've that we've where seen America where

Clearly, additional look our at years up the but were the with investments. it to next underrepresented gross side. So the We've with I right as modulate and pay we're say think that but pleased some percentage we -- we bit and the measure we -- our investment some back, starts year, investment we to into on margin, a added that's felt -- take go we payback. sales going total as end to we it did on -- internally, number, XX a takes salespeople time of the selling

Thanks, Great, that's guys. helpful.

Thank you.

I time. t hink we're of out

Dave our the And now for to remark. question. like that back closing was last call turn to I'd over

on Thank Investor you Day. to Analyst and our Palm in for you February hosting appreciate our in you we everyone. much. West XXnd forward all to joining here Thanks headquarters and look very We Florida

as course, to you. for is thanks questions all always, follow-up of around Sam Of but

for you This Thank conference today's concludes call. participating.

disconnect. now may You