Littelfuse (LFUS) 1 Aug 182018 Q2 Earnings call transcript

Good day everyone and welcome to the Littelfuse Inc.

Second Quarter 2018 Earnings Conference Call. Today's call is being recorded. At this time, I will turn the call over to Head of Investor Relations, Ms. Trisha Tuntland. ma'am. ahead go Please

morning as is President welcome communications we President Heinzmann, I'm Littelfuse CEO the Meenal and and very look webcast second and CFO. will conference a We Vice and section with and our And investor This the of results community. today execute copy earnings are strategy, Dave website. investor outreach relations call Littelfuse quarter to A relations also conference I quarter with reported you working Sethna, to call. and excited our our on forward develop available for of Executive to available website. be morning. investor and second our our today's of messaging, the focus XXXX a team we and earnings Good me in to release financial join on the

statements. will to information. risks the our investor the non-GAAP review relations statements will section any risks today of forward-looking remarks from this update turn earnings our of in may call available actual now measure I These our that the Dave. release discussions and could XX-K compatible non-GAAP assume Also, financial is reconciliation today Form GAAP press financial significant forward-looking A refer involve detail today's differ most We over measures. to obligation for our these measures provided to website. in of cause no XX-Q include about Our our materially to more to important Please uncertainties. release forward-looking results and expectations. and

joining us. thanks Trisha. Thanks for and everyone Good morning

her role excited that Relations. leadership created and appointment Littelfuse. announced our Trisha we the Head will to we she of to have within started, forward of know We're on XX, bring June we like onboard look the Before get expertise newly I'd as this Investor to and to

performance across by consistent all Our demand integration of the products IXYS our business. driven for operational segments including record second the quarter and broad-based results ongoing were

and XX% efforts organic record per of execution remain focused that ongoing the we generation provide and double flow. free the brief million A we in of We our As Meenal call color share growth turn $XXX on benefit reflect results. who earnings strategy generated revenue strategy, achieved worldwide second on applications, the of the well $X.XX, world, on as our to to a the we than quarter long-term digit strong we quarter. of our our positioned strong also by expand drove introduction, greener a foundation growth and and operational more cash markets profitably associates growth. cash quarter With increasingly focus year-to-date business of I in deliver remain from supported a excellence. high of earnings over of will will connected sales on some additional to the This safer, through very adjusted

Thanks Dave.

from highlights second some of quarter XXXX. our Now

continued euro. We second quarter exchange the a foreign the partially stronger by was from unfavorability some growth expected, as than organic revenue our weaker offset momentum in

second adjusted in year EPS up $XXX strong quarter excess XX% and our delivered up some Sales in this guidance. team performance benefits, driving last organically. Our with over quarter operating were of supplemented XX% the again May non-operating million of

margins $XXX million also growing last finished the quarter, operating addition, In another IXYS had strong year. XX%. %over at business with GAAP XX% in sales

to last year. Our adjusted operating margin was XX.X%, essentially flat

certain company to purchase and and accounting recorded exchange some diluted average. share the business These well legacy non-operating integration $X.XX, related which as per included charges. in from from operational ongoing related We offsets We and with business, margins acquisition foreign lower our $XX see costs approximately were mainly million as, of losses. in IXYS after-tax than adjustments, to performance robust higher the GAAP continue business some results volume earnings to IXYS leverage

$X.XX, Our last was adjusted over diluted which was year. XX%

Our along business, with finish leverage related by additional assets. was legacy record our in volumes led

favorable and expectations also several Our initial our market areas. end business deliver mix above savings improved operational we’ve finished synergy IXYS in with started efficiencies to as

Our again benefits this also quarter. included some EPS adjusted non-operating

changed last noted a equivalent We non-operating XXXX relating on EPS I $X.XX recorded quarter, in As accounting to investments. a rules to gain equity few investments. in mark-to-market

profitability We our expect about $X.XX Also, in favorable potential jurisdictions. due volatility, EPS lower midpoint, That's projected continue the rate or contributed mix points XX% change to was accounting will drive tax to to basis losses. tax due gains XXX to future favorable benefits. about in our

versus basis year, XX.X% XXX IXYS at Looking operating by at Automotive points last performance business. current the quarter This than the operating margin finished margin. driven by was lower electronics business, XX.X%, startup lower were headwind down year. Commodities our a in incurring new we’re sensor and last program remain last also XXX launches. margins basis costs auto some year, versus of points

basis the achieved sales more segment efforts points year. Industrial last XX.X% prior Our growth reduction robust as quarter, a XXX improved margins margin operating over for cost than and

cash we’ve our half XX% cash of record cash million We cash generation in delivering strong of year. led last flow $XX $XX XX% by grown generation, sales record Year-to-date operating continued quarter. cash free the the cash flow over growth and the Profitable our million flow year. for by for our in first operating flow track free and

across the a excellence to capital, synergies improve ongoing cash performance. cash is on initiatives. also part of drive and working payable focus operational working business flow ongoing We've our our inventory. IXYS begun accounts especially will Our These efforts also key capital

We’ve leveraged bringing gross we the net front, on ended target in cash focus nearly $XXX us back allocation far debt leaving well capital leverage EBITDA the on quarter million to range. repatriation so within below X.Xx, year. and this basis efforts, X.Xx also at On cash squarely our

our the to ongoing shareholders. cash deployment our for profitable the part distribution balancing of to in of our pipeline our strategy. leveraged gives combination of driving key execute is be active capital continue acquisition and with A We to us ongoing inorganic portion strategy our liquidity growth flexibility of investments

dividend our commitment of execute to consecutive Our growth percentage quarterly rate dividend to value our digit eight We're trends. in deliver with our are of directors more first XXXX. significant from increase to for pleased for in ability double is that, of on and our $X.XX. on This business XX% turn a confident board year our successfully it as and dividend, continued the color approved of the the to our remainder we $X.XX cash I'll in performance quarterly shareholders. to execute for With our year the market to very Dave back performance increasing half

year-over-year. with quarter Electronics growth performance XX% Beginning which for sales IXYS, of strong Meenal. record full quarter was our by the up Asia. reflects first Organic led XX% Europe million and our for were segment, sales Thanks in This $XXX XX% results year-over-year. Electronics second grew

Our quarter again benefited results from broad-based in the strong second demand. industry

continue reduce of capacity existing to During the able were a X.XX, efforts concerns exceptionally for Industry we and healthy this see quarter. growth at contributed and backlog. our we sales our demand leverage anticipate business. normal These backlog. to solid excluding QX IXYS remains With the products, third the quarter. near-term quarter, patterns limited Electronics to book-to-bill We legacy strong our a see to capacity exited we

inventory a within and they on We sell-through. are customer distributor eye believe watchful continue consistent to keep levels

From for generate our advantage broad of portfolio. the Our to opportunities as be of wins sensor continues automotive and of and saw design electronics, appliances We are across strategic robotic control design the across markets numerous we in industrial design The for Electronics continues for wins the growth electronics a smart devices. and to take geographies. detectors secured across cleaners protect, lighting to Internet to and our as, LED well driver a security and smart well innovative vacuum business of readers. Internet Things business, key positioned Things range a cameras, products we barcode and of smoke to key connected wins digital as used quarter wide line

performance these important close for While wins. we continues an numerous generate be IoT USB also battery product growth C cable LED and continue opportunities customer our are market. to outdoor Type opportunities, street our differentiators. protection charging drives protection collaboration lighting to direct products, key and Across

previously about the lighting projects We LED Asia in for won recently projects in have in quarter Australia. new talked business and

key North where our with win outdoor where a we we design gaining secured another for one gained we are lighting sensors. design growth and addition, LED in are strategic new In key manufacturers. wins Appliances America, share opportunity

quarter, pressure rice high a manufacturer sensor a level fluid a had global the for with China secured we and dishwasher for a the in cooker. design win key During design win

were automotive Our powertrain design second in its momentum continues including wide in systems. The critical wins. were Applications quarter largely the and electronics quarter $X than customers business ADAS and lighting, systems, safety ranging Asia. with across million this driven by wins infotainment more

crash secured serious systems We system battery solid used in the continue in to the and crash. Europe wins also key automatically charging of circuit vehicle across for a application. emergency onboard for eCall, notifies protection automobile event management hybrid responders and wins that electric see We've

player IXYS for previous across vehicles. We're leveraging talked to technology required the and in on power on global and growing Moving to portfolio position charging had continue solutions. unified our Show growth strong revenue At highlighting IXYS, make a and distribution strong a as June, semiconductor We've and see market infrastructure Trade we to engineering demonstrated to industry. our quarters in our broadly great Power in quarter presence the combined we Control the in opportunities our recent progress integration a and about sales to the channels EVs and sales product Germany teams in customers, our efforts. second these

this in key We off we range secured charging. are semiconductor Chinese in wins for a opportunities million about manufacturer. with space vehicle related electric vehicle portfolio, across for the vehicle design excited IXYS than opportunities a $X We win wide had where more of charging power for the on

opportunities required. semiconductors motor the many control significant power and of motors. drives, and driving industrial efficiency for reducing of lifetime these high cost portfolio to IXYS the where the torque, tremendous power are power opportunities drives for improvements, is speed the of is One see ownership achieve within These helping we

industrial drove such in IXYS demand market, cost in automated With devices, we're applications external and Last portfolio a discussed long-term is and device drive opportunities business elevator. better strategy, where the the during growing designed in and several a actions seeing these defibrillators. provide improved are quarter office initiatives and to control in the made and efficiencies. quarter, our ensuring that also and automation requires savings. used these logistics safety beginning factory significant IXYS of as products quarter, IXYS new voltage medical with reduced business high see completing for We're we products where switching requirements, semiconductors progress Our the capabilities. IXYS the used purchasing We align on consolidations specifically few efficient to efficiency power

wireless of In Korea. business the in we exit addition, the completed Zigbee-based

We the potential sale opportunities. have including IXYS been microcontroller business, exploring for strategic alternatives

rate run synergy actions With by of these remain on planned, cost savings the under and end to target others million we our realize way track XXXX. $XX

As our Award Level deserved quarter. TTI, we to is up make mention have the the segment, this consecutive some Supplier Electronics of We I global from awarded received ninth one were Excellence of this wanted wrap been we recognition Platinum well distribution the distinction. year electronics partners. This industry awarded

was Defense Excellence with IXYS awards recognized are customers. and testament teams quality the All business. and the business of level for service addition, the to Supplier highest four work Raytheon’s Systems our from hard global In deliver to the of Integrated Award commitment our a

are with look around and continuing the We of recognition customers to forward our this proud to world. partner

where Automotive we sales for $XXX I the of record cover million will segment, quarter. the Now had

In sensor comparison. and have year, the X% as large program our business We American growth higher fuse commercial as, overall business, which content, our X% organically. growth lower tends softened year-over-year production, and Automotive to grew saw Our businesses. North well last across vehicle auto launches strong

revenue. quarter great passenger Asia. in fuse and our SUV driver range more with one world connected our and Of platforms an these Japan, business our areas, passenger strategic The passenger momentum particularly business fueling regulations the vehicles than million for of in automotive for well $X of strong government We platform. for where design protection opportunities Our and safer, of geographies; for wins, peak for car a voltage are securing around from In results platform, greener protection new achieved for came window be wide sensor annual wins vehicles, towards creating growth for business. continues high million to the businesses record growth as, car $XX had we car crossover our as foundational secured fuse power electric across China, a offerings. proprietary increasingly vehicle more fuses revenues design

a We won line delivery also support Europe, to as, pickup platforms new in as of SUVs luxury business trucks well North in America. van and

Europe. in strong second results digit sensor revenue growth automotive in quarter, achieved Our led business by double

convenient sensor comfort, to shape vehicle. provides and key today's as per continue cars our increase safety and trucks, portfolio As automotive emerging efficiency content opportunities trends and to our take

business German vehicles will ensure manufacturer we won with and movement sensors efficient speed of the example, the new where For a our safe tailgate.

sensors Our providing play seat sensors Japanese safety. our China, In added business a will with belt in speed role won manufacturer, critical integrated clutch new a our efficiency where vehicles vehicle's be sensors powertrain. buckle system, into occupant a position the transmission and key increasing to dual will

business revenue for also vehicle strong commercial and for quarter, record Our products or our end CVP geographies. products pull delivered a our customer across the markets

XX As new opportunities one a CVP our strategic our more result, of this including key design power growth business than distribution wins we secured business. in for modules,

electrical the vehicle customer a systems North innovative manufacturer leveraged specialty wins off-road customized We on-road expertise with solution. worked provided our vehicles. and American of in closely and One with those was

our we the Procedure. some the the implementation do for see with through in the segment, Test Harmonized of Light Looking of WLTP, headwinds ahead remainder likely year Automotive Vehicle Europe Worldwide

connected have longstanding We content relationships auto vehicle we expand of leverage continue to and manufacturers safer, with that In delays. the the strong, more remain to greener suppliers vehicles. produce Some that best-in-class testing high tier warned that industry to OEMs our optimistic deliver cause continues and solutions quality, backlog our Automotive vehicle. summary, can one as per could production

cover will Industrial we Next segment.

XX% sales XX% year-over-year quarter million Second $XX were up of and organically.

were Solar in and the speed high fuse Asia in drove and key line strong demand projects U.S. driver Europe our

and of oil a markets, gas are industry We rebound global the demand protection mining realize. driving and slow our for seeing

presence continue to expanding distribution the electronics also industrial progress, across We our our great product of make portfolio channel.

On design in number used we program front, of including Japan energy win storage win data power. the a secured important systems, wins, center for in a backup

in with gas of used design also We the pumps industry. electric manufacturer oil key and the submersible had wins

fits we that growth Lastly, mining long-term no which custom relates strategy. industry, our heavily as with it segment, Industrial to business, was longer tied potash concluded the our to our

above the second we exited annual company's had expected have revenue the million. exit and a quarter, an impact to This $XX future of material earnings. the rate During sales business, custom which is not to run

for items a other before to Finally, provide third the on like I'd quarter. to comment few guidance Meenal the

our is While operational to monitor performance we closely execution across trade our continue solid businesses, driving global environment. the

has The operations of our across global our China, and imports, align number been within manufacturing affects products our tariffs products significant our China a a as strategy with U.S. our on Electronic to have across of implemented We other base. recently footprint segment. segment customer small number

our the and are continues strategy. impacts to how business with IXYS the and our execute on see long-term focus global our contribute growth on we growth closely on be recovery opportunities tariffs additional our we of the working Electronics, market will to implement In taking costs strong dynamics team customers minimize opportunities. are excited tariffs advantage to prepared are to are efforts. to on where additional necessary. Should We the customers of the passing imposed, summary, In and

content may record to vehicle. opportunities Our continue grow see Automotive our to per revenue, again segment achieved

growth drivers to will are Meenal. Our is we strong market have to that the and to I the seeing moving year half over as of executed call With showing of Industrial improvement. signs In segment look first fundamental continue the turn well momentum forward. that, total,

Dave. Thanks

and and the foreign XXXX Now regulatory million. of growth growth $XXX sales Based million the reflects year. reported the the let’s over $XXX of expect organic last third to quarter move XX% The on rates we our X% guidance. midpoint guidance current exchange to to on environment, sales of

of year. the EPS guidance. XX% The This growth A of XX%. $X.XX per adjusted diluted third an few approximately guidance to to rate midpoint $X.XX. effective tax to our last earnings be expect We over in note assumes range points representing share quarter adjusted around

second We’ve typically we also negative well our Electronics, led Second as, quarter as backlog quarter slight robust across our year. our sales the strongest is sequential sequential reflects exchange seen foreign third businesses. the as quarter, decline sales, decline quarter of in historically auto impacts. by a reduced The

reversed year has impacting that of of the the Our dollar, a revenue the U.S. half recent revenue first has during been foreign this growth. with exchange negatively of tailwind strengthening

tariff, guidance also We’ll the to update on expect implemented generally from we the China be impacts future quarters. provide an recently which impacts includes earnings. neutral Our Section in to XXX any subsequent

starting the improvement impacted Our activities leverage term in profitability. IXYS profitability including business to With is bottom under and lower level, the dilution to near an share interest related line we're by expense. way, synergy well IXYS the see our

Over the quarters, expectation. return our next several operating leverage we’ll to back

approximately range items, interest to of year financial Looking and million. the estimates million, expense specific some amortization $XX $XX full ahead expense projecting $XX at million adjusted we’re on of in

range Our tax XX% full rate year remains XXXX adjusted to XX%.

the million tremendous several had With to quarters, capital year’s we’ve growth the $XX we're this expenditures $XXmillion. forecasted to past in increasing

and Our year return on us. high in strategies each expansion drive inorganic capacity a dual investment organic different businesses for and yield

pipeline Given IXYS projected We of on we the growth impact to the of share the ongoing X% in of expenditures the transaction interest an expect our for previously dilution. expense of impact year, excess $X.XX and factoring in sales EPS deep X.X% had basis. be capital initiatives, to added of

of performance the With we’ve synergy operational the had the and for aligned to XXXX summary to now strong EPS expect our net growth. of a transaction be approximately XXXX. strong we up In XX% pace accretive $X.XX realization, will with profitability first and sales half

to portfolio, deliver We continue performance best-in-class and through and product growth broad-based profitability. global footprints to execute ongoing operational

digit year it in strategy. questions. to that, open financial for with five underway of growth our goals achieve Trisha, And are up let's sales We double our well and earnings

question we'll Meenal. Valerie, Thanks take first our please.

of Harrison Longbow Research. Shawn question first Our from Instructions] [Operator comes

Your line is open.

the How the the guidance and much the sales could into looking up versus it results. if is If to different seasonality versus maybe strong were we work Congrats in $XX down of million think currency on components backlog factor? second auto down midpoint. buckets, the that around at about I of the break Electronics in quarter

let down, look break Shawn, Yeah, let me me points. it – maybe into so basis

So $XX about FX is X% another then is probably XXX the that. talked And probably million areas. basis XXX points. business backlog other of we’re normal Electronics sequential some and say Automotive the the know is down, calling points basis points. offsets XX you our about I’d three are we've about. you so After biggest of basis custom increase, other exit got another sequential in those declines of with that, pieces The about

kind And then on Dave helpful. a on the caution bit Electronics just sell-through your following commentary a of the distribution. very that, sell-in That's you mentioned auto. year versus and for on also just on little maybe up because reduce that of expectations business, you of for Did the at market Automotive European some

first new are Yeah think know about I through. particularly some little going been bit them in are the of so, and it's OEMs auto; the Sure. approvals. deal on slowing I of go how some vehicles leasing are exactly park they've to to got testing; space to a with They've talking the down. unknown, Europe them

our it's second as of I look our the we've eyes the yeah, that of in just volatility got half fourth think and on, we quarter, of kind to It’s year. softened of third the the view significant into revenues keep that probably So, amount. one not but issue

backlog lead our we in, through. On during some margins burn which that than overly above so general, with see performance at now, X.XX left days ability our POS, Electronics of and demand, the we in our sell-in remains or X closely book-to-bills on still we're not this sell-through, We so pull demand strong the book-to-bill. that consequently to point. contributed during with the at distribution continue side, quarter pace in partners sales a the of to at these we anticipated to we concerned book-to-bill times position, line the remains very the In sell-through healthy. no second second inventory the continue actually second quarter the quarter, is very, so sell-through positive of signs with signs drop really faster during dropping in negative any to The know Their actually we watch because have our QX there. you and side, which very through

legacy be quarter? then, where for in On times, the there you the as to be would like add lead and will or the do well you both Littelfuse you maybe as, September IXYS backlog exiting

most would for our our our core I products of them at times. would very we say or – normal near lead electronics legacy be What source of

IXYS of going So, kind that. of internal on, some that's work related lead to there to extended of capacity and things to is there. times and that some to normal still capacity product of pattern related we’ll sort of like the it continue in categories some has subcontracting

ability to We on continue business. it's But the to try time the lead to core, would through sort our to optimize this to a products at say work pretty normal stage. get I of IXYS close

you. Thank Great.

next Thank you question our please. for Shawn. your We'll caller take

comes from question Steven next Our Fox Research. of Cross

Your open. line is

Steven. morning, Good

Thanks. Good morning.

or following in last at on require how end terms the just in additional answer demand? is much meet would on First maybe of the your spending that of much IXYS, Dave, capital down to road order lead up how fixable that

projection clearly that's heard business Yeah, this our IXYS that and increased we're to spending part have capital doing year, now just talk and a for you will in continue may as little do We there. there's about. bit the capital of with Meenal there spending

are You need we normal know, expansions to do. there so capacity

the So, and through needed chain takes through of also as will adding some But there efficiency on to that. we supporting clearly factories capacity some that at is of addition, IXYS capacity working supply driving the just programs and and supply excellence better the and and it do in operational chain. be time our

you or now of then if of terms how QX rate so probably business? earnings in kind you get what rather? helpful. you're the targeting did from Great. would the of That's much QX And with deal $X.XX, versus the in then $X.XX And run acquisition, terms in exit in QX

half – the it's loaded less the it’s be than back-end year. of we've the it's in first though been gotten, of definitely going second half in Steven $X.XX, so year, Yeah, to the

be I the activities a on MCU going dependent still to think the run bigger the going is for have that exiting on alternatives some rate few strategic we of business. on one being

So, exit the feel better how the on of we I that. us we'll and year for have give going indication we’re would say quarter third into a you to

a with you Okay. the tariffs, of I at pretty us these to a environment. of least easier idea comfortable easy insight passing that issues. is Thanks little seem And bit manage and into reflection and then very guess, of tougher sort it's else what through Can just tariff where give demand versus the lastly yourself on how of you would also costs customers, these to do some of you that's much. around

cases, just that’s those also cases necessary This of for In we're pass and customer that that there's it's the is Yeah, do very nothing there and this China the we our percentage distribution for arms us different our which into its tariff your customers, the us fact channels. Steven, customers. can distribution a to and impacting some involved different around. very in In largely cases, question to for The work high partners, to we can, them. with that chain might get other is many question work is then just the to help it's complex answer their Electronics they great the our drawback In tariffs them potential that is importing literally sell and have U.S., eliminate from through case, kind of and can with as of some and customers supply components, simple do. adjust structure as help those a on. of and

distribution necessary. So, we're with to partners working pass often along those where costs our

it. you much. Got so Thank

Sure.

Thank you, Steven. next please. take We'll our question

Sheerin from Our Stifel. next comes question of Matt

open. is line Your

Thanks. Good morning.

your a and are talk sales they're customers regarding in that like for parts Are constraints sure most and production that lot talked of capacitors Electronics components probably question electronics course, So, you've I’m that terms passive things is about It you've supply doesn't just find. or called of because out the lead you and companies goes and normal. like to a because and, through any seeing your the waiting of distribution, seen you’ve customers a change like business that and to of resistors hard are concern times rescheduling something on sound about? Dave, and but

Yeah, them and on they in and we from partners rates talked keep to limiting component that may where shipping our at like overall reserve demand be further the don't out ship if so will, a a lead our because of been more capacities pattern necessarily able Obviously about our are our we us on technologies to certainly have their constrained would are times see in are sometimes where particular the distribution not there dramatically to. something booking products, technology inability moving them shortages and because customers steadily they space, Where our factor. our you to for because that impact have to there.

distribution customers. it partners, of we we have end as, as is our with well seen lot regularly conversation a haven't So, the

remind could on business, business that the And roughly? of Okay. geographic us then your auto breakdown you what is

the between three core it’s it between regions, all a up them. kind Automotive, ends split of in split Yeah, being reasonable a

Asia. Our it to differs. little vehicles the within between side and into in pretty vehicle world, But be car tends evenly a also a may passenger split we’re America by commercial followed in Europe the the North regions more be centric, count from content vehicle our differ the revenue to because region, tends that although business selling

even up us. ends it fairly being geographic a So, for split

Thanks lot. Okay. a

our We'll take caller please. you, Thank Matt. next

Thank you.

next of from Our Glynn Oppenheimer. comes Christopher question

is Your line open.

Chris. morning, Good

standards the about. you that in Thanks, testing talked on good A morning. Europe question

get even you XQ second that and quarter think you starts that about period? a would kind as that? you if adjustment a adjustment as look an XQ, fourth that to in if of to just normalize due period Just wondering, in into half beyond Maybe course push the from normalize

maybe in will, as Yeah, going they to in if create just There in already long-term kicks we looking it. have and before now right get testing September they're in to vehicles for certainly its through sales it reduction some aren’t vehicle production delays, I say because it's stacking when at don't in that waiting up it parking to – you lots a Europe.

so the they overall bit we it’s situation, reduction modulating I months So, and more I'm don't up we a have timing see vantage in a fluid particularly sometimes But don't little to Europe choose that a their not as build it it's very output, sales sure they to the think. summer Europe; during predict just the may issue on so modulate their point best lower, production in as in that. inventory,

dilution Okay. wondering what on couple of quantify I’m IXYS, could And you impact was then a the for if Electronics margins. the

think forward? if reducing those you've above what I bit second were revenues backlog expect from lead as you'd quarter been working IXYS little a going times, maybe Secondly, a little,

were saw let talk the and do will. with line IXYS up revenues in expectations about if and think we’re little were. Well, from can that the what talk we the to bit overall dilution comparative, ago, the to in in IXYS Were and IXYS numbers you second revenue -- an year the of in they things a our and well where that quarter a then backlog to But off XX% that me from margins. IXYS they're Meenal like we over

eat and I when we to the throughput the away directly and long times. extended to those as adjustments in ever a begun those so, IXYS probably of time make continue Anytime are We IXYS, to backlog at been products mix there. book-to-bill lead some we in it's because so that to book-to-bill the side. talk about products lead of a the continue the what bit and we and we’ve kind pull are, and as they've projects times stuff we the so [indiscernible] ratios of other would set maximize, out lead impacts things, work

we there saw the second the about think in quarter. what revenue anticipated levels we I

So, Meenal --

call the Sure. your business question Chris, was IXYS. on the I I’ll delineating between Electronics margins think versus legacy

that We six we're we’re We're we million looking business focus our that putting haven't have – together segment, that. and months businesses disclosed because operations we're now on seeing resources the really trying really we're and semiconductor between business. we're integration and it at way Electronics across within about the it's to now move $XXX into

margin the haven't it at separately. and we’re been more about trying holistically So, look talking to

If I'm to returns more I could one starting some wins wondering the if I XX sneak commercial acquisition. you think Menber's in, see on in design vehicle. small you're real Okay. mentioned,

and acquisition we’re our to show Yeah, overall what vehicle certainly think is customers promise kind rates. the Italy, a good what base, with is customer growth customer we would which base drive diversified and is reaching there, the offerings is relationships improved even the I in European the higher thing efforts Europe more our more in I in some Menber's healthy for expand technology it's we’re ultimately has would potential access us. of reaching and as will at commercial beginning to it which say done say

So, I we're from think getting that this benefit acquisition strategic stage. at that

Thank you.

take Chris. caller our questions, please. next Thank your for you We'll

you. Thank

is question next Our Leiker from David Baird. of

Your line open. is

morning, David. Good

IXYS things to couple A here everyone. morning Good on start. of

were you what in might of You’ve revenue increased initially would have it year. the into to XXXX? are that the contribution relates thought are are more talking a are you combination this the acquisition or accretion from synergies of it Is you of be? opportunities, Or XXXX that the finding you where that some driving things timing, coming from as were

of I ability think the largely fact IXYS by out more our that product the get work driven factories to with the is door. to

Certainly, So, our our we a I anticipated. was we stated first quarter I’ve being go with weren’t higher surprise think than ability quarter in anticipated. revenues a as in I make to although just -- Chris more second fairly quickly and difference than think

we’re higher by the think drive driven So, through I to a its of able it. lot revenues

those synergy kind I are of aren't in what think expected, different. the materially we with activities line

stronger to get just I the it's through in factors. business ability product our think a

and and the excellence programs to then try of the we're is forecasts. that David business that boost our is January, add just some volume view add, overall, beyond in A even of performed initial that. the we I has lot have we been then the even call some I gave leverage stronger getting much to would the growth better piece from And definitely when think other and we've I’d operational the able additional

synergies track. I original that’s but targeting are weren't and anticipating, on of you synergies some maybe So, suppose, of we some call to want that there, we were the

position, it? you the position then belt you've competitive bought it, that that know you we space. technology Okay. six And time that owning months the terms Anything of the your under Great. of at in and [indiscernible] as learned IXYS got then didn't

we customer are to. capabilities, products of semiconductor. potential the Yeah, the relationships other if I optimistic anything Design think long-term certainly myself power with IXYS bring also has more and and about the base that we Littelfuse that can

that's the think engineering Their a at strong very recall, a very So, design I win and of certainly electronics strengthening in base where it's I business industrial I to desk. positive. much you the business think a access customer what lot is business our

think that for, were I looking very be for so to us. something positive that's a we continues

find we about the remain when bullish we that. we very So, bought, greater if than anything are so, opportunities

just anything after item content, getting. business, of that that the that a side, terms seeing growing the the the door the here. get one out what business in a in opportunities any be in there in us bit way If you look can your we you're that basis. you wins of when pursuit that business you're look little and at Then Automotive can going type at last in scale kind on of Is at you're just help color might on that details of that the the you then terms

get complicated of Yeah, that first to and we I makes more arms that, all, around. would say of our sure like how bit a and segments because and things report it your

for our highest one growth are the within electronics. areas Automotive businesses of So, instance, automotive

increasing electronic in vehicle. content the the it's So,

second shows our So, that's In the had our about rate the up probably that show doesn't automotive XX% Automotive one in Electronics in our highest up in segments. areas electronics. growth segments quarter, that of a actually growth we

in ability as So, that to say very that the that we’re are electrical voltage would kind robust progresses. having had pace, the applications market higher the we've fundamentals very, well continues of fact growing legacy very our I are infrastructure growth in normal plus that and and the at That vehicles the a of positive. our very there business established. share space kind position of, to where as increased content gain

that higher voltage. our by growth. It's we driven have So, content expected above experiencing business hard the as build continue, a are to that’s really we winning increase where

revenue move we and EV to growth those Then are sensors types automotive a story As applications. of pretty for robust us. also

in the remain space our pretty years. still kind ability high we doing confident of in to over growth the So, in over be Electronics single that digits organic coming

very you Thank much. Great.

you your Thank questions for David.

Our you. Thank C.L. Godfrey question [Operator from King. comes George of Instructions] next

open. is line Your

George morning, Good

that Thank quarterly little your segment that opposed in the savings by is or you you five I think I break with don't loaded out. as Electronics IXYS three towards $XX level my any to more million on the targeting was is rate acquisition, you. operating margin last within XXXX to XXXX, about that there just to the $XX Is And of to annualized at If XX%, is your reason can’t bit million? Electronics gaining end I look want progression that each the acquisition? about and that the back-end by linear a go to about wanted that years standalone tying that that your understand over that and IXYS ask cost then following you're XX.X%. it Or the at quarter. a before math that average margin exit

go me thought to end we we back when the up. and where we let would So, acquisition IXYS announced

So, acquisition the expense. intricacies at the we the to XX% and with the of time low into get bit the margins average announced in EBITDA synergies quote little were double we IXYS million actually that or to then expect company somewhere at EBITDA margins. time a $XX in that range. business up the amortization get I when right, we XX% is lower What would was than you because EBITDA even the said operating you're or that margin the in digits, running the and XX% accounting

all in leaving stuff the about EBITDA we what talked and low that the margins as projecting XXs because So, aside we've that's been down company.

few see we here, level, We are rate possibly that but and have worked definitely even we that Then that’s the even could years. which see been some margins, from feel quote. running not that. you talk run efficiencies years seeing We'll I’d first the we changed beyond also that this past levels have higher the that elevated know on higher time at you as volume about the that average with we over than Electronics two

past of in environment And fact folks I currencies so Electronics been maybe you is I at IXYS some gone normally have we current also those level, two nice to few talking together about at our a average, the that a past talking margins maybe pieces Electronics we've EBITDA demand so on But the on as generally been think being very we're but been we've of benefits erosion this long-term way company that a think from not years, that's demand talked this to the average, the in at seeing see some couple but not we're for the environment, margins business. our huge sustained the been has things And quite still I see, calls, clip lot average. well the over about a if very that. not one think put you’d the maybe about we margins benefit that robust have seeing for while. ourselves including price a

question of Yeah, and your the timing. the on second the synergy, half synergy

so quarters. gain will the of the as of We we it's through we as move gain will rate But is XXXX. synergies it of increase fairly bulk back-end the loaded, still back-end approach

very much. you Thank Great.

this Thank great Those a with Have look your the you Littelfuse. for again for today's day. you interest we have in George. We all talking questions, soon. us your are call to morning. you Thank joining questions on forward and