MSA Safety (MSA) 31 Jul 212021 Q2 Earnings call transcript

Good day and welcome to the MSA Second Quarter 2021 Earnings Conference Call. [Operator Instructions] Please note that this event is being recorded. I would now like to turn the conference over to Elyse Lorenzato. Please go ahead.

Thank you, Cole. welcome second and call earnings everyone XXXX. for morning, to quarter MSA’s conference Good

the are President, call President on me Joining today and Krause, Treasurer. and Nish Ken Senior and Vice CFO CEO Chairman, Vartanian,

we Litigation discussed this statements Reform XXXX. matters within Act I that are of meaning historical on like remind of call, to Before everyone begin, the the the information, excluding forward-looking would Private Securities

to, all performance. Forward-looking projections anticipated statements not include, future but levels limited are of and

factors other here. that cause Forward-looking as except and made statements the and involve undertakes duty materially law. our discussed by uncertainties results required SEC. actual those other in no statements differ on with to These may this to XX-K detailed risks, our uncertainties filings publicly call Form MSA forward-looking factors update from are risks, any

non-GAAP press CEO, this discussion well We With call our turn the measures have and morning as Chairman, are over reconciliations Relations to I Vartanian. included will at release our Investor available non-GAAP and certain of as our website as President part our Nish earnings that, financial the investors.msasafety.com. on

and good morning, Elyse Thanks, everyone.

have the X, you the of we second importantly, quarter. on seen, closed had a brief We in quarter. accomplished discuss we Most lot quarter. As a July after will which the of I Bacharach a acquisition have overview good pretty

backlog. only higher book the effectively our track to supply the year reiterate were we from glad perspective. demand in expectations, our our in that revenue drove on a a throughout mentioned that Core on product through ago. bit from see Our as was that am X% than us April revenue XX%. behind come was to a sentiment growth, strengthen we and increase I are Not today. returned up revenue Margins worst significant inflation to optimistic did chain. up quarter continued call in managed order we the I

detection to as gas we daily manage we Overall, is requires U.S. are situation and improves. the starting everyone, strong situation business through our for vaccine seeing lead fire continues improved chain recover attention. demand business and the remains that dynamic to supply a is to which issues, industrial service continue Our Like products. Europe recovery.

are areas gas our challenging in SCBA most and components detection electronic used Our products.

like revenue and have we more a business in leader the ability I in on in But managing of conditions even to stops the color challenges, as support confident that of we that provide level production done remain quarter. Still, advanced as MSA very insight future of job long-term will improve. three I backlog our through starts contributed lead provide of extended Our have those enhance market indicates good and issues. more pockets confidence our did to these Ken my times technology. positions with into our bill. would to areas safety the now

First, we those challenges toughest safety and our I continue about to launch safety talk a customers’ moment. technologies in that will solve

first for sales. LUNAR of our officially related balance new our scene sheet driving that in roadmap our who are our efficiencies technologies. management example. technology. And the our strategic have our commanders. are that investments we is capabilities and improvement The of third, with early one margin to strengthen read to mark is we connected The culture execution strong spring, the leadership of about of $X uses expansion hit it, Second, about are technology launched is you we or this product incident continuous organization. results QX feedback encouragement using of LUNAR, international make acquisitions We for start. adopters service a two handheld fire we bringing our pipeline, positions haven’t cloud to recently and closed in million key the R&D that is the off Bacharach from to with form acquisition a markets. to those and seen the this organizations market Starting revenue and of We include the innovation engine fire integration our strong getting device innovation provides area, for deliver

using incident firefighter invest agreement in enhance mission share drone when awareness we their firefighters. scene called a a have it are to venture Fotokite. making. is other may this of capabilities strong this technology to as Swiss earlier a seen situational Fotokite our the us new similar established This balance a for for autonomous mission that fire joint advance for pilot. We forward-thinking bird’s through because our sheet to gives it commanders We eye partnership technology and decision perspective avenue represents requiring company who MSA in safety collaboration comes release also press and an you And protect revolutionary organizations drone improve established the system tethered to fire is a a development month, name a to exciting with scene brand firefighters. without

highlight is culture continuous and our international want in expansion I to area our second The margin segment. of the progress improvement business

playbook approach efficiencies. entire three team delivering select growth markets, and in continues to areas: execute operational optimizing driving on Our focused international a our channels

XX.X%. basis recover executing is the up X the second international looking to have from the to segment rose the XX been playbook encouraging this XXXX, years QX margin for now to points. see margin XXX points back improvement We segment revenue And starts quarter, of pandemic. basis more than as it’s and operating to In margin

to in pipeline expansion ability international. margin remain place, we the our we of programs in With confident in continue driving have

it strong the we broadly focused attractive remains capture to our I about while headquartered brand in acquisition Moreover, markets value balance sheet of leadership expertise. a HVAC the leader If with strengthening in on detection is that business significant from the and to The very well X, I $XX perspective, an detection Bacharach we third recently in be in add where about balance diversification how we we strengthen closed to used we’ve growing further team’s end which make is of revenue markets. net the both healthy. With pro in leverage be complexity. a a want area and brands made investments. our and refrigeration Bacharach not into gas product the build of gas detection quarter Pittsburgh, On gas far From center Bacharach is at our annual excellence, million, acquisitions here will our am that aligns leverage, forma manufacturing access and key integration our confident it’s acquisition MSA. would from reducing highlight business. the Bacharach. From to July technologies, end sheet markets. X.Xx provides net. ability our position Bacharach in our perspective, our use

to we our So, mention additional topic business. to I’d continue well positioned are to our investing approach like is in ESG. One

not new is responsibility to Social MSA.

we dedicated XXX helping world’s protect the years, have For to workers. been

investments things the sustainability, believe prosper all mitigation to me ones in objectives safety. business programs safety, So risk that business enhancing create for focus chain and model created. effectively ESG we become help our we internally And and we better that goals be ESG It’s achieve to the on and resiliency do workplace companies But various value help to I clear supply customers also our our resiliency build by their to greater that us these safeguard have that own help who fit talent, be future. model. overall a will environmental into adaptability the to worker

for not strategy. companies. organization specific that quality particularly know We manufacturing broad a is but for challenge talent to are and our workforce any prioritizing we the top retaining areas And today, business example, through attracting pipelines just for

category. lot MSA a retention. invest we of country. diversity resources employees were XXXX. the than talent first also list in survey Forbes reason, ranked #XX #X the of recently Forbes for Midsize and employers This Engineering that the one time, we of on was by recognized recognition into We was around development as and best For based Best time Manufacturing the a and for were Employers and more for XX,XXX on And Industry

top So, it’s to to encouraging efforts of recognition further a workplace. create see our

that MSA’s me there are confidence three give summarize, to areas in So future.

safety very exciting is engine technology. innovation and new and power to Our continues developments it in strong

of grow across turn strengthen results, business. to Ken on more in take using to With is through all call you effectively the improvement will yielding I business that, Our continuous international the our detail and we culture are over Ken? our our to areas sheet segment and our especially results. strong balance financial

quarters. I with our QX order that pace currency. I are the book. around well with demand start fire good Both centered order will profitability financial and discussion up and Nish in look service to products from the our to Thanks, revenue, stronger and single-digits morning, second we X% XXXX. We increased flow. revenue growth the pleased confidence That for above everyone. returned coming constant provides products total the sales XXXX as at am on highlights industrial-related momentum contributing high tracked and cash in quarter,

by contributions uptick margin cash despite QX of Receivable over to announced $XXX points in to completed healthy. operating month sheet on than earlier the our operating revenue of X%. acquisition excellent flow strong, XXX the And non-cash the margin And a of negatively levels Nish our with we is increase half and very was approximately profitability the indicated, the our revenue, to are and debt an deliver Second, quarter. balance impacted related years, third, recently and acquisition XX.X% compared and stronger basis coming performance the expenses, Bacharach a well performance our million was cost invest nice higher our for expected position less us from as its We expense stock first and after-tax in compensation inventory positioned sequential our half. of business. showed in second to had this million $X

on Now, $XXX I at X%, with will in Revenue on quarter. let’s financial was currency revenue. million. the up up start second take Quarterly look reaching X% the revenue a a closer results constant focus basis. a was

revenue U.S. up revenues tracking was months XX% the performance X.X% addition a benefit behind saw up economic recovery, the on in partially offset presented with industrial basis. growth was partially In and a purifying is deployment FGFD offsetting PPE, air associated difficult Bristol, in by fire core on X%. The year-over-year international vaccine and revenue we which headwind a across few a strong up product comparison The business respirators. a international recovery a reflects business. currency, about Core was Americas While APR service X%, lower constant X% were lag our while the of in a

it’s should the to upwards strong I launches the these XXXX. see to service, head industrial investments XX% quarter. and growth for second products Touching at that healthy about rates levels SCBA our Looking also excited XXXX are to good or was of in in global of healthy very compared of It nature fire mission-critical levels. back service at XX% see fire and remains for the we business. outlook ahead backlog in our The on areas, XXXX recent sales product PPE, great a firefighter. note LUNAR and strategic connected provide the came revenues the protection

to FGFD business East. year declined challenging the compared Our last comps X% on Middle in

business FGFD orders In booked we incoming to the However, strengthen in our continue second largest one June, see we the quarter. of through history.

levels Our is back second FGFD backlog pre-pandemic heading half. into the to

quarterly supply overall, in same chain QX, MSA challenges to from electronic constraints levels. products. with particularly certain orders in to time, the incoming of For XX% surpassed detection end This in presenting backlog deliver gas XXXX has At resulted increasing our are areas. ability the components

how long half. constraints electronic around last, expect components challenges to chain will the difficult supply we predict will persist the it’s into While second the

Pricing consistent relatively with material and input offset prior margins roughly in was line profit to a headwinds compared were margins gross year. number year stronger in throughput of Despite profitability, levels. factories higher costs, in with last associated gross to costs. our Turning

respond components, the We have implemented an are across other seeing U.S. electronic to we and in that increase inputs. to inflation the off-cycle price resins

or evaluate to were additional these as ago $XX constant expenses million continue was from of inflationary navigate through up currency. opportunities second million sales pressures. the and in year XX.X% will We we a SG&A half pricing $XX

trend of played in by As I the the in resets comparison the the SG&A variable indicated and of million. of of base $X SG&A. about costs related Quarterly about and Bacharach the million Bristol and a second at about had on the $X out I the comp million comp transaction SG&A remainder to Bristol quarterly the pandemic. about as also acquisitions, adjustment quarter expected previously, impacted Bacharach costs expected includes that because being including difficult onset million SG&A stock April we compensation This call, about $X $X spoke of the

savings discretionary from programs coming cost costs restructuring the back into Our effectively business. offset

We revenue costs control continue controllables to business the slower the back bring at and into pace improvements. a than

$X invested our sales of for to XXXX. in the million quarter, international of XX.X% on segment half we in We to the as execute approximate margin expansion expect second continue primarily restructuring SG&A We roadmap. in programs our

date us and produced annual recovery. in approximately Together the discussed well results actions million million for programs XXXX across XXXX, had continue thereafter. and we to have to restructuring deliver with to of economic excellent savings savings Our expect income $XX in the of $XX position the statement we

Our impact is adjustment quarterly was of basis stock year margin our the I ago. mentioned booked in from down reflects adjusted earlier, non-cash points segment. decline compensation The operating XXX which the Bacharach corporate a

Looking XX.X% at of basis segment performance, XX international our were to up sales. margins points

and were programs segment very for great as we XXX basis volume navigate It’s the pressures pressures assessing much XXX quarters. return to additional help point XX.X% America continue remain and to drove performance see Our track. revenue levers in improved the the down quarter that mitigate expansion the cost reductions these with to on to associated future resets in the and inflationary points improve. sales. basis starts to margins decline are pricing the of compensation will Variable margin

quarterly adjusted XX.X% were quarterly basis. GAAP rate Our There drove a tax an on discrete that rate up. basis items the two or was XX.X% on

statutory one-time a tax the in to adjustment our XX% UK from the taxes. First, drove XX% deferred to increase rate

with Second, conversion cash XXX% we expenses net the allocation capital of flow incurred was of than flow associated income. higher and more From quarterly perspective, Bacharach. a free cash nondeductible acquisition

risks. performance with managing receivables, build improvements inventory build overall While chain did we well in was backlog capital working on as strong quarter, in which supply as the aligns our some

well balance us share sheet to strong positions rebounds. as market gain the Our

We $XX CapEx the programs. of on pro completed X.Xx yet X.Xx invested on On acquisition, paid be the a X, balance $XX Bacharach In quarter, the strategy. we following net impact XX. would forma execute million allocation continue million second $XX reflected is Since compared million on a basis, capital down acquisition of July dividends to our funded at balanced shareholders not June we debt, debt-to-EBITDA sheet. in to and to its

fixed to flexibility. continue we We half in amortization. adjusted In the million and capacity our interest $XXX X.XX%. funded funded existing XX-year senior of to greater of was the credit per we $X.XX borrowing our connection purchase earnings remainder will of amended to a extended of notes in with with which exclude rate $X.XX with transaction share the Bacharach expect line revolving provide to with May acquisition, earnings provide adjusted XXXX. of In The methodology, accounting and facility, second

We our structure also included a sustainability-linked pricing on revolver.

performance Our borrowing cost certain flexes up or down based ESG on on our metrics.

we in forma this With QX QX in the expect interest for year. to $X million to Bacharach, of and expense pro range debt the million would be of $X.X

an for moving partner also accretive of million $XX it’s in growth We been consistently our China a China July. us over and for in a of buyout China to about time. minority our has completed market key is strategy growth MSA’s important business our part forward.

buyout to represents this And business, to third We investment million in the we part this provides expect $XX balances. balances. deal, optimize The with back and funded repatriate a to local a a to $XX between of as highly the milestone U.S. quarter. this for us. As key our of strategic cash continue the market well in of result, we invest strategic business transaction cash cash as full as ownership helping foreign us million in

claims the cumulative result which increase our quarter. to product the the our an MSA liability $XX asserted adjustment the of pending drove against expense trauma product a million in on touch let’s subsidiary, in number on, as increased move of we Before liability of reserve LLC. reserve, We

evaluate process plan many our trends. potential filing monitor review year, annual in to this including we filing factors, developments rates. and the where conduct We later We to continue will development

ahead, in dynamic As we very look operating environment. are a we

for are cost largest the of into us. those in elevated While the the difficult we provide strong as From are the second backlog and challenges rebound impact. where facing as supply a order in be heading the are chain to sense today, pace quarter second an constraints half, supply can optimism of the variable availability inputs material chain Raw having the we well predict. operate

situation our of both mitigate closely are our We on initiatives on on this top laser-focused are line margin profile. business, the monitoring to impact and the we executing the and

midyear Our safety growth The invest positions that to market expanding actions and are never conditions that, I strong the cost With this continue takeout borrowing acquisitions, benefit and position and continue concluding programs, pricing shareholders will the improve. taken will recovery. position technology to stakeholders Bristol actions back examples. and some few remain recession significant we to Bacharach I leader. a that capacity support at number call in stronger, and the our Nish? to commentary. a just confident acquisitions performance for rates low been have as programs these upon our very for We’ve through over steps Nish turn of as our ourselves historically

have. leadership your time, any I chain positions Ken opportunities, glad for to will and growth My pricing to does half book future optimism higher the Ken. said you, well improving is onset questions. evaluating revenue be on pandemic. the order not At been and of the up that, give of months, Thank and we in navigating the this now open and Having supply across positions core acquisition the we focused remain Please and has additional XXXX. constraints, guidance. will geographies. us the level remember, for questions The integration, of In second since our markets today about you demand will MSA may take improving call coming return

question go our Stanley from with Elliott will [Operator Instructions] And come today ahead. first Please Stifel.

Nish, the They happen? does How to nice that focus kind and going about taking for you question. morning growth talked quarter. Bacharach the to take a on on and mix had good able long such Thank reducing nice product complexity. Congratulations in. of you Hi, earlier being everyone. the

expectations kind be curious Just what from of standpoint? ramp should a

the here and from technologies and participation and manufacturing for We perspective manufacturing today. of Yes, really the Bacharach $XX us. a that align perspective They million approximately products is and Stanley Good HVAC-R some R&D into interesting morning, well your market. really of and thanks question for markets. sell opportunity course,

opportunity their we and see through products of products some some nice so our some in distribution channels And cross-sell some our of of channel. to

And focus obviously, So way, the there key grow really, we that business. a along for business. forward some nice some that drive go is simplify us we that’s And opportunity grow will to as two to efficiencies there the some will to focused model through. opportunities work and is that. business organizations, some time and That the on between take be area to

are that we facility Monitors close and the running Ireland. and and up completed getting executing here added expansion Monitors moving in to know, Forest the facility have also and you As Lake that are Cranberry. We’ve General into that General very to

with some we’re full forward. we’ve But standpoint this So of as our we from be done that sales the going go really things a marketing from and got a plate perspective. to manufacturing on we’ve focused

had given higher-margin hop juggling And the calls. of you raw But the the cycle, was call margins little in what quarter? in multiple then so off. that of I all some Perfect. out apologize, strong in were of impact got bit Did shorter terms products I’ve of material I U.S., to kind the the headwind. a

quarter. are gross less But of horizons. there the a adjustments come in cost. think successful to inventory the SG&A, that that the the margin. backlog, about comes notably, have seeing discretionary in in, that we decline what basis leverage dynamic cost pretty with out may at we second go environment lot associated And the question. and were the in good variable pricing when comp a is quarter, at did as which is orders call the it very risks Ken. on that was are had, side. Stanley, in seeing And a We matched managing call that It’s it’s we we out saw products in XXX we fact rates adjustments that did a comp necessarily really It’s some certainly pricing had What not the we’re I forward, we specifically, with not that we’re point

and done price certainly we’re We’ve implemented looking So through at a increases forward. managing off-cycle We’ve price that. job good thus move as further we we’re increases, far.

of of start Perfect. very And on last round how good that a if you to could additional addition approach, been or you’ve value-based kind at pricing into pricing the of quickly lastly, decide on do results? since flow pricing through kind

to typically pricing start Stanley, takes that come to through. it us XX XX days see to

some price get So as can third quarter. have January. typically different fourth adjustment we quarter, in we We we’re into analyzing avenues a take the

in the options we speak, So to a looking something third at not price increase into do we we so then and again we’re do that that have that have in number and pull here of that January. XXXX or quarter forward, in January

situation our will we that. that we our nice the with One up bring fact that. will we that And customer lag we inflationary a market And we the of this a maintaining is catch to great that comes analyzing it the margins right expect value that we and level we’re go business. quarter we to take of the have in that earned confidence because our So the to base. get we’ve we we think job with a do forward whether to profile or position thing we appropriate two do margin when as good today,

Great, guys. time. Thanks Best of luck. the much so for

Thank you, Stanley.

you, Stanley. Thank

And Baird. question Rob with go next our Please will ahead. come from Mason

to that? first, than Ken. will? What did quarter? ability strengthen bit mix was that upside, curious the the Ken month, revenue out better orders Maybe, later in just fulfill thinking Or and maybe maybe just you a in for I accounted Was business that? job Nish, were little what the nice drove it what morning, the you played of in your Good if came The the on quarter. seemed in earlier Yes. it

my very and challenges. were to supply strongly. continue But first June, quarter Rob said question, as When chain seeing in the for webcast and half in on environment. we we the The I we see it’s our Thanks your had very finished of well. dynamic a prepared congratulations comments, promotion had as

were do supplies that is And of were we so able materials helped that the and to half what a some seeing. meet to source June secure of we levels be second demand in able us

some it’s it inventories the environment. strong So was finish. a us second – that very that of some and were seeing. helped of additional meet was secure customer that really that June materials half the just a driver really had We we dynamic to we able But primarily were was demand

I see. And just to clarify the increase the commentary around price in pricing off-cycle and second half. your price and strategy, you mentioned an something evaluating perhaps

So increase off-cycle just start be that to have third the clear, implemented you price Is to correct? quarter.

come had and another year. we a half and the second second We during impact timing the of price that price increase, and of still on earlier, expect We to that And the we’re now buttoned Rob. quarter, from some increase that haven’t through we up. at see looking implemented in the that,

been with the and those continue make we as of an challenges the past, price what from to analyzing the to of mid-cycle successful we know, will confident there price chain. administration. offset did nice be we’re we increases the a to we here of seeing that. tariffs same and We implementing back had standpoint, we supply inflation do job forward. during in had really to you with the see as offset able the inflation adjustments our We’ve And will kind we some what We’re with go we’re in increases Trump

I see, see. I

it efforts efforts? maybe or simplification for want to around year is going those that, question, to synergies, last the Bacharach $X.XX $X.XX if and am Just to next the the contribution I back expectation curious what into you built call

Why don’t ahead? go you

Sure.

business that it, certainly top a done, as very And strategy. very pragmatic don’t the we that, with the ensure acquisition business cost both of our well built have on as As always some have key basis. a on line – and this Talent business taking on big we’re historically lose any side. is the is stand-alone cost top we synergies approach to we talent. on into part Rob, With profitable a a the

than business, And it’s any so look this we other when our businesses. different at no of

approach about standalone fine we and we’re so and And a it’s business. walking we keeping just also pragmatic very a business it’s as those think – stepped on approach line there a synergies are a but that being cost that very the taking think profitable a we’re of that attractive basis, and very some intact sure because out

right. Right,

I recall, footprint, as seems for How you opportunity contribute if to footprint? offer play it to you international leverage out its start could well. some and quickly As that your

our Its Yes, have footprint obviously it opportunity approximately there we abroad. definitely to contribute. about that and as U.S. in a we they today the is think comprised of leverage XX% We the is XX% than an abroad. could larger of geographies do business key And some across think business world.

of well. and we’re certainly to So it’s that as about discussing certainly – we’re some channels it’s starting on our and something approach the plan internally

good. see. I Very Thank you.

Rob. you, Thank

come CJS next ahead. with And Brendan go Securities. our from Popson Please will question

to Hi, $XX orders good million was about less. obviously, on morning. I ask revenue outpacing just your XXXX, want but

backlog like make that quantify was million, the or sense? So how Does much revenue future pushed supply I in was can you much help just thinking if quarters me is million? $XX off could incremental the chain revenue constraints, how there? was you you Or $XX think

That’s exactly on $XX backlog million incremental range ballpark supply right. that in That’s of you’re issues. in that the – right It’s with missed was we to saw due that. chain that the of out

I go good think to with. that’s number a

to hear guys just actually $X us number now, great want Thanks. ask, that strong million, looking it’s small a Okay, even a is recurring? though it’s give is obviously, LUNAR, but million. to at all then great. start, And I really that you getting $X

recurring not it’s revenue. No,

fire go similar nice some we’re today that we’re at point, And sales, will opportunity into strong. for go is those as that’s see and product around we has built around this that don’t hope At subscription subscription build think uptake around sales been investigating. The we we product we and Certainly, exploring, that’s there LUNAR. that there revenue there to built So to forward. Think apparatus really But a on that it something that have breathing that, future point. service. are departments. recurring services opportunities, be this some of nicely

And this is you for the any quarters? Do tell I trajectory Is sense. go hard in Makes to Okay. it point? that? idea coming mean, then have that where could at where

It’s We could point technology nice put market point the – and nice hard think is see fine us. to good of on do but is really a growth and difficult this size the really uptake to on. product new that one LUNAR be that. But opportunity put a there like a for for fine we global a some application

Okay, great. you. Thank

Thank you, Brendan.

Blair. next from our De go Maria with come William ahead. will Please question Larry And

and Hi, I for thanks. if jumping think timing everybody. obviously, apologize that a you that of we that is great. been And is backlog – because last may How book-to-bill as have question where revenue versus like missed. would to on bigger discuss, versus And already, or you think much the Just But see would of backlog backlog, backlog? supply Can the answered you it the and how you how when the strength late. about real the incremental would Good morning we quantify where be converts color haven’t bit getting on you’re terms the in demand of specifically the issues? And bigger. getting I it’s chain well bigger.

color and a thanks answer Good and to Ken I’ll that more then for the can little morning, I’ll it. What question. do maybe Larry add is

is our So book-to-bill about XXX%.

demand in the the was we were strong. I and surprised quarter. in quite snapback demand all demand and really by strength was the throughout second the so And

of obviously, continued. we booking was had chain level issues And XXXX some that And so as supply above well our levels.

of and the growth range, in look the XX% revenue groups specific at and XX% that’s product significant. those breakout can the that you see, when the of you those So

in a So indicative we’ve came seen it’s really a recovery, construction way. markets seen, real end snapback in of and back and gas, nice demand, the we’ve it’s in utilities, the nonresidential oil whether the market that

orders really in service which strong. saw So The missing it’s XXXX. come We for demand was remains broad-based. big fire for products in helmets, fire some

business to was see So start nice come it back. that to

are as these systems is demand will out. some from We think go demand it’s supply issues There just will of And So to through think work go broad-based. And the we that really chain forward. a all continue. I we that standpoint. – need balance

with at and and we price be should able way its an offset discipline we out. standpoint, that the markets, manufacturing. will in the look that pricing to you our and end markets should gain increases around efficiencies work that and inflation As From some

Ken, supply will really going do these with quarters. as a and place business to over issues you chain this in few forward good We want And even through I to to we the we’re some work think land into that? add ‘XX. ‘XX go of next

the XX The a second thing going only XX in say is It’s XX, the half I the would away to going see is next Yes. chain challenge. challenges hard days. to supply be or

standard at as to not may some it we of cost to like broker going that. so perspective, face be be – the from of think can at we’re very a continue volatile. buys this. and And some that We be And prices result, doing things a times, might

demand level – So a environment. products. to through. around inflationary through customers It’s supply market I very our our it’s what about The agree some is very good really come see we’re our products coming But strong, they challenging environment, Nish remain would level definitely definitely back. recession, now demand share and had time very, indicated. with our growth good We’ve challenging to a for the seeing the positions and how see strong talked the chain

to a really it’s environment demand good So in. be

questions, average guess, products or buying, or direction the do mentioned spending, Are hats I obviously that but and of on a the of yet, more the investment it government we ability to of then carriers that bit be LUNAR, firefighter the you And given we this demand? Just any Great, you because hard or talks, your oriented change and safety firefighters some movement hats. COVID. respirators obviously, How could seasonal could resurgence from two, year but including now also and addressed already seeing think color if on the about thanks. obviously unfortunate less be above the apologize this, discussions? any any it And satisfy stronger? I buying and

product. standpoint, fire and market I let opportunities a Larry, address first. I’ll really, looks service that guess, parts. demand our take really for Yes, From fire good service me in the

look quarter we’re saw the funds for that strong what in think are pretty in are lot coming AFG I previous We years. will us like there. So we shape in Fourth those good will a second think half customers the be and as to marketplace in buy.

side fire, really the for we demand so apparatus. think good the for be breathing And will

the helmets door. of us, be out product to turnout matter is course. will And of the for fire good gear a continue getting think I

gear. nice backlog We remains business The have strong. a there turnout around

a saw from really some an getting And tailed will standpoint, significant respirators off. that. going national air that, the throughout piling of think way. year I some I There don’t to From move XXXX for talked respirators. demand the of We have we half. think opportunities so be a there. we headwinds that’s some real some second needle door But around strong that really factor out the that some purifying will product was see we a as strong about, orders are stock just APR in

We’re not million. talking about $XX

may something talking second that be And single that. here of through. the millions then about over more range there dollars, for in sub-$X in of will will we the that some come And probably see We’re opportunities future half. million

want do national going there so you So some for needle, Ken, move to and really stockpile, that, to not of opportunities speak. we should add are see but that’s anything? some to the

Nothing to there, summary. a Nish, really good add

helpful. very was that Clarification, Thanks.

re-price backlog have any to any we talked or potentially on or As just you far price increases, more costs protected anything the need goes, and backlog risk do is to about color or backlog just price given and to? material or ability as the the don’t you on on even there that need you are

again, mentioned had that risk necessarily, being a is in There you doesn’t if say, a have but see earlier, always risk don’t always sits April, is. risk it, material I long. maybe We missed is bit is the in backlog do too is – lot overly comes an pipe business. backlog have change between and prices backlog business. – does We not ship but it because October risk material a periods. until as and our that a part see but it don’t there significant overly you book weren’t on, you had business I there time a a ship also an of order those of our that large an But

Thank you luck. Alright. it. and Got good

you, Thank Larry.

will & go from [Operator next Instructions] question Chris McGinnis with ahead. Company. Please Our come Sidoti

protection, mean was economies for because yours? that that invested in that share marketplace to you’re as just in I more of the initiative and question. strength taking that morning. the Good was reopen, does out And maybe the taking have of think the Thanks prior wondering to Thanks. with pandemic I market? go orders share you guess fall just more take in I my that

Good morning.

or We in for years fall lot for mentioned, whether to there strong bit were protection during I think market point have that seen And time And market we’ve as growth period, taken tell whole very X had wasn’t we products. time did not demand where things shift this during We a XXXX It’s at feel of pre-pandemic. retrenched growth. some, share share. hard that share double-digit of obviously, the us of a you increase a nice had through period. taking kind just market we we

is good a uptake in some products. We’ve to We’re of it’s those new right in taking some that introduced products. We say little the here that we’re some invested we’ve XXXX. confident soon products. of market too been know there share But

It’s a Falls to enhance of area we to construction the U.S. major an product And a protection even going better as we into focus throughout of the an of their U.S. here product of or fall to for year. and number do utilities well area have But get will construction line a little killer that the of continue build, number and one it’s construction we you infrastructure world. continue still snapback, to are of the companies in are see throughout companies workers. whether in will the world there. for safety. the think a We construction the be focus view nonresidential we’re as think deeper falls confident We We have. with growth that remains strong.

a So we and opportunity we’re protection, good growth there with with believe think is well positioned that the curve product. fall to some nice continue we

luck for and great. my questions Thanks Okay, QX. in taking good

Thank you.

Thank you, Chris.

to session. any Lorenzato will Elyse our this conference the And for I’d turn closing back remarks. question-and-answer like conclude to over

for joining want morning. behalf of On this here, team us entire our you I again to thank

you days. to will of transcript great Investor you, on and Thank We website a with replay available forward call, for next and Relations missed the again you If conference be audio XX look portion a soon. the talking day. an have our

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

now may disconnect at time. this lines You your