Lincoln Electric (LECO) 25 Apr 242024 Q1 Earnings call transcript

Greetings, and welcome to the Lincoln Electric 2024 First Quarter Financial Results Conference Call [Operator Instructions]. And this call is being recorded. It is my pleasure to introduce your host, Amanda Butler, Vice President of Investor Relations and Communications. Thank you.

You may begin.

good and Sarah, you, morning, everyone. Thank Lincoln to Electric's First Call. Conference XXXX Quarter Welcome financial and lincolnelectric.com earlier our released results We our today relations this slide investor release call's you presentation the at in section. in find can

me President Chief Hedlund, our Financial Executive is Bruno, and Officer. Gabe the today and Joining on Chief Steve call Officer;

Following remarks, happy take to we're prepared our your questions.

from call results start that a risk certain release during in filings materially this XX-K SEC note may to our actual statements on our our and please may and expectations XX-Q. discussion, we forward-looking, number before factors But which be due and press our differ are Forms in made of and uncertainties, provided

GAAP comparable the reconciliation call the section earnings and measures Steve website to we in measure financial is GAAP the non-GAAP available a in to Investor that, I'll do addition, In financial U.S. measures of most Steve? discuss found which Hedlund. turn again over our that at tables with Relations in is release, lincolnelectric.com. the And our to not of conform

morning, Good everyone. Amanda. you, Thank

cycle $XXX the flows. ROIC of share in million repurchases, to by slower returns doubled Turning solid to challenging XXX quarter. the all sales led in in earnings adjusted I Slide achieved report performance, portion start We execution margin cash gross and navigating shareholders, operating record profit remained the top margin we basis continue to point pleased than and record quartile, to year. while that a to a we expected X. increase income and demonstrate our was am

are long-term and staying we on focused this customers a serving growth. investing for In our environment,

higher and gains strategies and accelerate expansion productivity standard profit in initiatives. to despite drive positions continue managing working This earning market diligently end conditions. from costs are well us XXXX XXXX softer We to operational to our

with sales through slow the organic and contributed equipment, slide heavy automotive, timing industrial X% along industries sales choppy in in activity and strength project quarter. comparisons oil HVAC gas against By remained declined project performance to up year quarter, organic strength projects. notable with in and and be challenging strong energy end to prior-year on automation resilient midstream in approximately Middle sector, East of and X, all comparisons Turning activity. in the to continue challenging Areas the prior Turkey

data, of lead are also prior and steady organic regional year activity consumables orders sector. see to the recovery production macroeconomic in industry to Welding a general stages tends Americas versus few by We an pleased industrial in which This suggests sales months. underlying with aligns early

capital the elevated maintaining quoting a consistent On and equipment seek through solutions the customers quarter current continue remains side, of acute address the welders. skilled from help we higher shortage strong activity order as quality to and are that deliver backlog automation productivity solid activity

Moving to X. Slide

As part developments. highlight long-term to for a and few our recent I sales like our of investment would earnings of growth,

including dynamic solution a between First, handling portfolio, a our we MES that of over customers' ahead schedule. The automated year our milestone sales run automation brings a offers solutions and connectivity billion, of rate addition enhanced their RedViking ERP $X systems. global marking strategy higher production to standard specializing key They new system testing based acquisition material Michigan, of and as in automated also integrator capabilities to software add AGVs. an automation solutions RedViking, in such announced our proprietary

material Their systems, Cobot since additive handling, and a mix position solution sales global the capabilities welding-related believe brings in addition of XX% assembly first and provider also high and our non-welding launch to portion of leading industry. includes This quarter. reaffirms automation in that nonwelding automated we our milestone, with our automation key precision cutting, the we mid-XXXX testing, this announce our welding X,XXXth non-welding. this approximately to sale the The during is celebrated of range proud manufacturing the as Cobot along machining. XX% extensive I'm the

you of the may growth. company, time by margin recent Officer announcement earnings will Michele the underway be impact that Kuhrt. which seen appropriate accelerate Transformation our We enterprise-wide range initiatives at a Many led a of executive outlining was productivity to have role the creation bolster the dedicate new of Chief a currently to of long-term and felt senior

Resources company made Officer, addition, succeeds In welcome to new Chief date. progress Gabe, the the am I'm company. our extensive confident to call Edwards passing to leadership conclude To as and the HR have we to who to expertise in and I Susan pleased brings before the Michele Human

execute strong a improve to strengthen have via our full a all margins We and M&A attractive of to in contribute innovations initiatives creation growth on team accelerate position, active to strategic that which stakeholders. industry-leading our value and pipeline, for continues our long-term market

pass to call first detail. I to And will quarter now more the Gabe Bruno in financials cover

Thank you, Steve.

X. Moving to Slide

$XXX to exchange. profit price from record X.X% gross profit maintained margin. benefited drove combination foreign a X% declined management lower prior Gross and volumes. We sales from levels basis at increased operational to XX.X% improvements points profit approximately X% acquisitions to XX quarter primarily performance. million favorable first strong and Effective million, dollars a cost and Our of $XXX

the basis transition, including incentive of progress increased which XXX costs to expense compensation XX.X% lower CEO SG&A due increased quarter. not as sales. of associated primarily points million higher with our $X to X.X%, approximately will sales on a second percent in employee-related SG&A of Our million $X

an plans asset Harris the costs. versus acquisition $XXX includes prior initiated items, charges as Reported transaction $X was special with steady approximately and operating Group well million as and Products rationalization million Welding of relatively year income from International at including and

income net increased to XX% adjusted increased expected and XX.X%. quarterly with which X% $XXX million, run more our consistent $X.X Interest items, operating margin special our basis to Excluding to operating in XXX declined points quarter adjusted income rate. the is million, expense

XX%. effective Our tax and reported was first adjusted quarter rate as approximately

low- the and earnings of of anticipated subject XXXX year full the expect to tax to- range in be effective extent items. our rate discrete mix to to continue mid-XX% tax We

First was $X.XX. per quarter diluted earnings share

special items, a Excluding diluted share $X.XX. per adjusted earnings was record

in Americas sales to X.X% Slide the sales acquisition X. the with to decreased across our due X% reportable segments growth. compression all contributed benefits Welding and X% approximately Price primarily on of of Moving areas. lower volumes Powermig quarter, product X our

We contributions expect to increase acquisition in quarter, second RedViking the acquisition. the reflecting

improvements Welding XX.X% adjusted points to and from adjusted the increased The benefits EBIT cost increased XXX first management on Americas portfolio segment's quarter million. basis team as approximately $XXX EBIT integration. the operational X% automation to margin in recognizes Fori the effective

the the to their above We operate continue to margin remainder XX% year. expect of Welding XX% EBIT to target Americas for

segment in Slide Welding X% on in by The X% comparisons Middle and X. prior sales year activity declined Turkey industrial International activity the project and approximately volumes. Asia lower Pacific. weak challenging Europe offset to East was Strong Moving in

price year-over-year. While steady X.X%, EBIT declined disciplined margin management cost International Welding held segment's

their of sequentially lower EBIT end the improve XX% range. expect performance to XX% to to We their target margin

Harris to Moving Products the Group on X. Slide

from improvements costs. EBIT basis with reflecting X% Volume on HVAC strong business. approximately impacting to Price First structural was X% sector declined to the management Adjusted primarily The margin volumes. to XX%, lower residential weak quarter the trends EBIT higher a points adjusted effective cost increased sales and X%, million. X% XXX softness metal increased $XX approximately industry. increased

continue We team this expect higher to operate level at the to in XXXX.

quarter, capital Average record on operations comparable in XX a XX. million Slide XX.X% period to in generated versus flows year the basis working in operating resulting from $XXX prior inventory cash levels. the cash to Moving XX% conversion. points decreased improved We

approximately shareholders and to than at $XXX Slide CapEx the in double million our $XXX in repurchases. XX. We returns payout a share spending to and Moving more invested quarter of through $XX dividend million million higher

on We maintained solid XX.X%. capital a invested adjusted of return

shares expect due prioritize pipeline in to for balance as a strong quarters by recent ahead acquisition. the the We the will continue year, to repurchase but seen our acquisitions opportunistically RedViking to of M&A

Turning XX. Slide to

start initial We despite year performance. the and have full margin stronger slower changed not year to assumptions our a

to sectors. We automotive will conditions and and in Europe, in monitor automation the in recovery industries continue investment including progression general improvements order and of trends, continued strength any the economic

performance basis primarily trend the Harris from improved segment. on Welding We're Americas expecting organic to up flat Products to second a sales quarter in consolidated Group and

on year. of We also and a anticipate basis strong the EPS the performance balance consolidated continued margin through

$XX a contribution $X.XX In April EPS and XXXX addition, contribution from adjusted RedViking. in sales we million an million to our $X.XX of estimated to $XX approximately X expect acquisition of

are our over to turn on customers, During focused on the our will we cycle, which now staying would for for to innovation and all I executing this our generate superior call continue portion like stakeholders. And the of driving strategic initiatives, questions. value of

Instructions]. [Operator

with Your line the first of Oppenheimer. comes question Bryan from Blair

It's indicator. a Good quarter, and consumables relatively you Thank second framed how to the obviously, [indiscernible] see you. Americas noted leading key that you you steady, morning, everyone. encouraging

in gives the going end on color quarter curious get trends the to top little the what trends regional more improvements line to confidence entering stabilization and then and second a offer of and Just market forward? you

Yes.

I'd little So of Bryan, just quarter. color start giving second say why business for flat-to-up on our we the a drivers

continued and quarter So fourth the year. And balance as driving the and and we but that that in for last in Americas in forward strength pointing quarter orders of pull the we've to backlog a the quarter, of we been impacted second quarter strength automation. see over know is we the had the profile first the

the in for So we confidence the automation in business contribution have Americas.

and been retail now, the on at trends both three business I an good Harris. organic we're in business. Harris. We've of Harris also core think, seeing our inflection April, and quarters on point point compression pivot seen a in of We've But part

progression as that us that So confidence well. is there gives strong

as cautious here We are our comments Europe. in in

macro metrics, continue that to If be Europe business. challenged, and you to our continues the at choppiness look see in we

metrics leading the we look optimistic months and so We at a typically you in are when U.S., few that's lag there. like PMI which lagged a we macro would the indicator, more

us So PMI. business in to of short-cycle the progression particularly it's important the pretty for Americas, in see

in think those drivers business. how the So of are our we

automation the pretty acquisition to little assets a and What on strategic to appreciate I current fit bottom from stated be? And synergies margin your expect fit with the high how And for color detail you this you offer that Where capabilities. line touched creation existing profile? year revenue the for the accelerate the and seems contribution. much Maybe more on there. the X do be year? within you. could RedViking platform, is range Yes.

the Yes, Bryan, RedViking. with for talking by about I'll start automation strategy

the continuing our competencies in of simple competencies. and to is developed to we're and following serve them needs expand fairly the that customers capabilities we've that sense leveraging strategy the those Our and

customers big a of our assembly get is the you're and as fabrication cumbersome large, steps to completing process. of the parts the One of moving problems These material hard move. through a lot have heavy, particularly various factory,

think really for their ago, a the about year Fori over a line. platforms you little acquired replacement AGV a as the If assembly business we function

fairly get a line a if standard of in how So be the feeding smaller, parts modular that What very, more configuration think main the about the cells material assembly is to brings about do assembly you think an is those AGV. table to very cells the from large RedViking might platform, line. you

So we view complementary. very as them

customers, fact, RedViking. and see Fori both we In them in already buying many

great So we competencies. really, needs think and the to our extend that's following just again, us. and customers' a And fit for build it's continuing

$XXX of move double-digit in our just fit LBS excited it second model. EBIT we're price confidence overall they expect pretty and but Bryan, at automation from a add, into the quarter And they'll Initially, transaction, will our range targets fits have our nicely to the just low within see looking a business. into -- a it to standpoint, It's we're of and purchase valuation how right we million. system profile, within

so very acquisition. where fits as we're with It this we're satisfied very well. And at

from Saree line comes of question the Boroditsky. next Your

quarter, believe, So Americas margins extremely recent years. the in highest in I the were strong

than being You these the I a of being margins at the high the that. end above of range, even or stronger are above -- the mentioned, think, end but

sustainability of levels. margins So these the just at talk about

Yes.

business, yes, we're which right good. to the the be up confident of mix we're higher that you're is So very over range, of end XX%. the going just And

margin nice expect very continue and actions, we a mix that been Our very in in management the of it's And to good the automation, which profile business. year. we also driving of improvement cost throughout had posture just

So that's to we're what over going gives the that range. be us confidence

about the in And I guess automation. talked improvements building comment, on you operational that

of business So margins this the in you kind where And exit as where year? they are automation can go today?

Yes.

just ahead remind that progressing We're low-teens. we XXXX I ended So of that. you

is target our average that XX%. corporate be to So at

to XXXX have And agenda a objectives. so we very through focused hit those

question Nathan the next with comes Jones Your Stifel. from line of

in on this give that I specific role, will just us wanted out that just ask about Steve, what leader role. creation you can role. -- Kind looking Officer in to any the to color Chief focus of having what Michele's be achieve of Transformation a of you're

any the of that? you creation Just can give us around color

do Sure, that. Nate, to Happy

I to change what how note to at to do but or think do, not get we trying the is we the better it. are important thing who we're we really just

think So if administrative about of and to our opportunity more those standardize managing the customers for to relieve burden expansion us some employees they enable on focus We higher service an market the to help automate so can at processes getting core us of you of on just do. to business simplify, much some activities. processes think continue growth by we better and value-added to to there's our our opportunity our margin accelerate just what above effectively

see It's took business new new opportunities in bolts core and we effective we better opportunities boring technologies shareholders. forecast the fairly and And where it to that's to investors of may the it just us pretty We're and become nuts to of about a ship, excited to just lack business to the because front efficient. to pay. processes, much the see ship in the these more and and get internally -- capabilities the sound buy leverage

EV for testing making the Okay. more ask the on you're the terms just money want the did building there is update making investors. don't equipment, ever to in of I business. commercial boring progress Any I organization. about think charging

that's the of Just progress an update on how going?

we're Yes, plan. the confident Nate, in

great call, for key in year, the our We're And we'll and industry. working to we that more continue technologies the for I testing to host going makers after a full event quarter. plan second last on you did to prepared showcase now decision again right we to the us we're capabilities -- customer CharIn the all a Testival June. mentioned the the getting and last in the We for and work That's provide as think through acceptance. update validation

have So the for we're work continuing just more in to updates and the we'll you plan future.

the Your of comes from next question Baird. with Dobre Mig line

decline somebody the of gives significant the guess quarter? volume expectations of sort to in guidance back the already what stood here, how that International. the I in you had that of the asked question in ramp kind the going the thing into to relative your And essentially, that that into is Americas matched confidence the coming me but the sort a you baked I'm and out curious quarter was as a see to what's pretty ramp to you're half of year. And

other on that be So us that and that is sort entirely of of? to predicated automation? Or are you're aware need some assumptions there investors making

on a address of choppy we impact bit and to softer of what Asia the question, first in we markets. mix than Europe, softness The volumes just also your inherently. So I'd contributed was Mig, the on point an about the first international very quarter saw Europe little anticipated. a comparables acceleration first to part in of

at We expected Harris. saw you what

comps saw tough I accelerated we say the into we on bit pressure some industries. saw would look the throughout that we we know you little had the some When a particularly on consumables I had the On heavy on to production side, we OEM side, schedules, the going quarter. that, first But the as progress softness, Americas quarter.

So those the drivers. are of some

we margins, on back we both and what than talk we have our into full and backlog to assumption, half. the automation, quarter when as expected. as stronger the -- on that's to second we well our sales organic very year then assumptions, side, about sales pointed strong the the changing And continue and are not orders, But margins organic

our the activity we short-cycle business. our as monitor, And so you've we're continue changed in we'll assumptions, but of seen to -- haven't maintaining

key optimistic. like PMIs We but you contraction that When and conversation. at in look side PMI the the U.S., the on macro pressure although you conversely, measures the in are see what's driving that's same Europe, industrial on

the just likes like Just the a going pressured. if be part certainly heard ag machinery from The We're follow-up this, hear OEMs. from It on is I we with struggle going is may. to production I of to seems Caterpillar. that

event. just So not QX this is a

talking here, a and being construction slides even about little your be you're digit, that personally. infrastructure I down in bit mid-single to found surprising which And

recognize whether again, But end comfortable on core incremental equipment with I markets, see So consumables, or verticals? and you're at your automation, as your as the it's I'm do of you looking at you're that. looking signs and comment business, stabilization, which where those

always of between Well, quarter-to-quarter. have I the the would -- investment just we there's comps capital emphasize, is timing strong. projects And challenging again,

I think in with short the driver the key and that like OEMs, already. term is key mentioned schedules production you the navigating

destocking potentially And that's markets. function some in the of a

of level the drives activity. that consumable so And

long-term So important production from and still the automation investment standpoint, schedules OEM of are of strong equipment productivity side, terms navigating but short in areas an in term. pretty

of pretty note, the add our cycle business portions we And short-cycle of Mig, long comfortable portions The and and we're have they're cycle of that confident would short takes, I there's long to that first just in And to, are puts right? in. visibility and starting our guys business. cycle the that As to There the saw you equipment going We a production. lot down likely happen are quarter. take yellow choppy. is

continue We second to expect happen the that in quarter. to

the the steady, already earlier, The Europe. The sentiment improving the are which not We we're higher year. our into in macroeconomic coal challenges industry conditions in activity higher see the our that general continued it's for and the best mine, some of probably Gabe Americas, at the encouraging particularly and sector. expecting business, orders holding translate see see and second you is to look sentiment, consumable portion that canary in there of half in we expectation moment. that favorable very in signs But incorporates us outlined at when we that softness

on the half. consumables of for for second Again, we the orders have don't books a lot

come, to agenda that, keep control the performance date, control really we're still and forward. can to market very execution. conditions. very our and with We're happy end But optimistic. going just strategy our but to and we're are our those team, in we our beyond the strategy We driving confidence in So can't our confident

Your comes next of question from Barger Capital line Steve Markets. the KeyBanc with

will slides And a mentioned percentage need, term, any, business? software. RedViking, you the new capabilities recurring software your Can talk the about be automation across for about what do from with portfolio? In expect software and longer the you service you as then MES interoperability the of revenue if

Yes, Steve.

and cell getting a there's a think collection like. shift of you the in information at of that out or challenge a But into was is lot the cells, part ERP That lot system an can customer's in which cell we we of if system So available is cell, throughput to about of so automation all that and which a access genealogy sell and automation the given can trace it. made information we take of for part production have the customers. a from terms

want So running integrated systems they visibility but to and the data, that already separate and the not are be they system. traceability want a of it

And positions RedViking at us to able better do. software be to that's the really MES with

not As weeds, do little a down far and in that, as the that recurring figure cells probably with of that you the right? percentage bit Because lot a have software a related. of is we it's revenue the think on don't automation it are as I for have software existing business good I

upgrade work got we the reprogram help do its business. We've in come the performance. equipment it that's customers. the good a and service and operating have of for we fairly in peak cell lot We to a update we at keep where So robots

and system the us. that's not after automation of revenue So something to an is new idea chasing

is percentage? you can gauge billion XX%? revenue of $X you're XX%, run that recurring some -- kind rate, that give that at If Is us of

say the to magnitude on XX% Yes, the in I'd order X% range. of

Okay. point Everybody And to cell. AI out your about an information getting story. the then of loves

train learning your for chance. test or Here's the installing? systems Are as or you're for automation using tool for and you machine AI sales improving a

And what the our business try I is that got we've Steve, additive right, how or a closer a to lot, x-raying make most a I destructive of do or -- net good confidence good. we're weld doing doing without parts have, did how print answer fundamental near go our weld, AI We're through made just additive testing like, customers that we shape. to do the or greater activities just having in lot is question we with research have around a to in to sorry,

of And with a wide the that it, of quality process variety different a parameters it's affect nontrivial task.

of effort you lot make weld. improve to predictive going the there's ability So trying a into will, if score, to for a our

I a a the lot tell, remind me in It's around engineer. really [indiscernible] to not. an too and activity it for comment not component on or system And whether there's can't early MES just business. AI of RedViking the has I'll everybody, So major AI-enabled an I'm to

So...

of opportunities I AGV AGV follow-up. And core is really sense business welding a evolve just acquisitions to we into see And to Are automation a trying TAM. how X on? focused quick one of a growing more had should exposure. last going The what this heavier outside are is get obviously more acquisitions? guess I'm there you just that

they're and See, I rooted and we've cutting fabricate is position, the happy ground metal think through think while or moving welding parts, of assemble heavily the the hunting we developed -- their Yes. I to cells. our help then capabilities challenges So to about rotate, out welded things factory about we're right? welded using cutted customers of way That's being really history those the cut, and things, for mentioned earlier us. people hold manipulate in it simplest or and in

things. make opportunities continue customer look add to to for doing to that value money and we're helping make to places we'll by in where So people

We've tube cutting, a already that's it within trying gives process or we're making in us welding is part. on sizable or such deburring know got grinding a how of we're whether up what things. the That's set part confidence that those right? because built a welding not figure welding, to factory to business out. operations or do applications that go other people agnostic sizable relatively to guys very Now large not we've involve or into the vending that and In these

[Operator Instructions].

Your from Stanley. with the next Morgan line Castillo question Angel of comes

up I maybe Could think that you so -- talked about kind XQ as think a as about then you still starting volume make flow outlook the little so kind think flat-to-up, kind volume. and think the and through of makeup guidance organic full we kind I also price the last talked shift the that XX-XX and last about of was for to was time price growth? there reason that of talk that of Is another about Or about right more you the for a up the is in really softer. second year, you in guide? XQ, of about year the full think outlined quarter, guidance, pick you unchanged bit way price the quarter what kind sales to of of why an

Yes. Angel.

pricing take actions will this first you're in the quarter. did that quarter mature We first, in second right. So

in a modest in and XX our I It more is volume X/X expect to February. price quarter February, little to basis contribution of would a to points more you range. bit growth. the organic organic So growth. we X/X price, had mix to second between XX-XX we in middle of the assume about price, talked current In profile the would volume a I a than discussed that contribution XXX in be look maybe

is year? full the that comment last And about

year, Full yes.

Is two, that. just pulling to would customers, suggest, a price? I the what's that guess it of that than back difficult from kind standpoint. a volume on clarify bullish you just guess, I negotiations? had more outlook One, And kind of laid out environment,

get And more, there about would incrementally I full the parse year, Is the that that think I way for about was something guess to a be stronger that that volumes right of helpful. out could didn't kind the you sense if bit necessarily it? but

Yes.

So, year are mid-single-digit low- Angel, mind growth. organic that assumptions in to- keep our full

range. a that's So

So negotiations. particularly on we do side, contract expect you've the progression, got where consumable

markets first was our in in that the although a of up. are international quarter, holding You little pricing bit where saw the margins down

of and So equipment. it consumables of pricing mix is dynamic a the between

So know, that's But a tempered is you on to we outlook get price full year on bit be posture, little pricing. less neutral. where cost as the our

You've a and managing so far disciplined this our very we and on price, very feel got good year. progression processes

saw You that gross XX.X%. percent, at in profit we're record levels

so And in in just profile profit our the good positioning we're business. of a very

be disciplined as just price. very so we to manage continue And we'll

And better That's maybe or then bit the bit more. backing automation just a on very helpful. side a

You of continued environment maybe we you little been are of a clarify organic bit more could sense, kind given give those you talked for you a like quoting customer us you about full growth anticipate there. could of the X, color X, for growth And automation year? just on the kind activity are kind but has mentioned strong, just macro conversations what in? the that what

that a confidence the long-term to pointed that's what to us to And quoting. expect throughout progress that's within year we continue just Very and from point And our customers strong to They'll opportunities gives to orders, activity on businesses. the their productivity just be backlog side. we growth. automation improve and

that we was growth that And to So refresh growth what I will organic automation pointed in terms automation of operating assumptions will in is within I framework of volumes. the that drive just XXXX, -- X%. in business

business. more So orders tempered and strength on organic -- and automation welding gives what core the within is the type backlog activity. confidence us of But of

comes question Seaport Liptak Research. of final Walt with Our

[indiscernible] that. the pricing Just and pretty looked like [indiscernible] international continue comment you last profit, guess profits? is I and But question on the if I of as those about to a international contract year wanted move start pricing the comments things the on up the Is through bit to volumes to wouldn't good. get And that guess, international volume ask Or should from profits pricing? I little a negotiations question. the you given and can become one

Yes.

my in EBIT segment to profile of prepared comment the to that XX%. into to continue did remarks I which International improve is the expect question. end great So, range, we XX% lower the

quarter expect So improvement from there. we XX.X%, first

you or are price? maybe few that But related it got from Okay. cost-cutting okay. attributing from the a follow-on volumes that late. Great. And I is Or What improvement. to a or efficiencies? minutes to? Is that

Yes. the emphasize in business. strength saw first mix this I we of in would just quarter. Middle the East, I Turkey mean,

continue. to that expect We

We our in Asia the there. also expect improvements business mix and

So will driving business. -- opportunities to drive continue it's mostly to of We do it. business, mix our shape we

already this confidence gives You of that quarter. us saw that But what in in profile. first that's margin some

then how January, consumables one you you to U.S. any And April, and just about last talked as February, -- saw Were trends cadence one. of for guys Great. that Okay. March, maybe asked demand if the just equipment well. you

Yes.

did comment Walt. on that, we So

So we The to particularly a thing consumables, just pointed industry side. some did consider on pressure in comments choppy heavy is the environment. see here pretty our on we one

equipment industries, So while pressure automation overall heavy business. and strength the on in consumable more of our within side investment

just the quarter. industry side we heavy expect And second the would that continue to into -- on

was We industries. general are and good framework about consumables more That's optimistic in the when mix steady. that relatively a you PMI, of think

in the that look on continue So PMI was of we in to the first into macros good the quarter. we short-cycle some in strength quarter, to positive that expect second result and to And orders.

looking So to. that's what we're

to remarks. would question-and-answer Bruno Gabe call our concludes closing for turn I back like session. the to This

We the thank on progression Electric. us very of call initiatives much. to for to future. Thank Lincoln the strategic everyone for and Sarah. like in continued you, forward the in your you interest I'd our Thank today joining look discussing

thank concludes conference This for you call. We joining. today's

your disconnect now lines. may You