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Consumer and electronics end markets continue to be soft.
consumer and electrooinics soft
Transcript
2023 Q3
24 Oct 23
As we make progress and deliver improved financial results, we are increasing our full year adjusted earnings per share guidance to $8.95 to $9.15, up from a previous range of $8.60 to $9.10, and our adjusted free cash flow conversion range to 100% to 110%, up from 90% to 100% previously.
increasing guidance
Transcript
2023 Q3
24 Oct 23
Yes. Okay. And can you just give us an idea of the range of the absolute margin? I mean we could probably do a lot of backing into it but what you now expect for the year from just a range on an absolute margin basis?
Monish Patolawala
Between 19.5% to 20%, Steve, versus the 19% that we had told you coming into the year.
mgn guidance
Transcript
2023 Q2
28 Jul 23
And then specifically, I know that Apple is considering rolling out like an all-OLED iPad next year. And I know when we went through that transition a few years ago on smartphones. That was a hot topic for your company. Any thoughts just around that specifically and how that impacts your business?
Mike Roman
Yes, Joe, I'll go back to my earlier comments. The decline that we've seen in the first half has really been driven by reduced demand in smartphones, tablets, TVs, those different categories. There is an ongoing shift in the display technology from LCD to OLED. And that's something we had talked about.
As you noted, we talked about it a number of years ago, anticipating it.
We continue to innovate on the OLED platforms but we do see some impact from that shift as we see the continued movement away from LCD to OLED in a few of those categories.
So there's some impact from that. The bigger impact, again, is the demand in the end markets, smartphones, TVs, tablets and laptops, a few -- those categories.
apple oled ?
Transcript
2023 Q2
28 Jul 23
So it's a mix. And the impact from China is part of that as well. We're seeing the slowdown in the markets there or the slow first half and not yet seeing an upturn in that and looking for that as we go into the second half
china weak
Transcript
2023 Q2
28 Jul 23
What we are watching also is, to answer some other of your points, raw material and energy cost inflation coming into the year was $150 million to $250 million.
We have now changed that to $150 million to $200 million.
raw material and energy betteer rthan expected
Transcript
2023 Q2
28 Jul 23
Secondly, when we came into the year, we had said OI or operating margin will be somewhere in that 18.5% to 19% range. Sitting right now with a lower revenue number with a higher EPS number, we believe that we'll be somewhere in that 19.5% to 20% range which includes all the charges and all the benefits
margin better than expected iitiallty for thr year
Transcript
2023 Q2
28 Jul 23
Your second piece on where are we starting to see margin, as you have seen coming into the second quarter, one of the reasons for us able to beat expectations in the second quarter was driving supply chain efficiency.
So factories started to heal better, raw materials started to flow better which allowed us to have longer runs. But at the same time, the work that the supply chain team has done under
margins ok , on supply chain ikmpfrovenment
Transcript
2023 Q2
28 Jul 23
And I would say picking up on inventory in the channel, we see destocking in a slowdown like this.
And so we expect some destocking to continue in the electronics channel.
So as we go into third quarter, that's kind of forming the view that we have.
Now what would we need to see? We would need to see a turnaround in demand in those particular build rates in those end markets. And we'll see, I think, confidence show up in the inventory in the channel as well.
CE still weak
Transcript
2023 Q2
28 Jul 23
And overall, the trends that we see make us feel that where we are right now in the first half and where we see trends going in the second half, we feel that from a revenue guide basis, we'll be at the lower end of our guide that we had given which was flat to minus 3% coming into the year.
low end of guide
Transcript
2023 Q2
28 Jul 23
headwind from disposable respirators tracking to the high end of our anticipated range or down approximately $550 million along with continued macro and end-market uncertainty.
respirators headwind to high ~(low) end of range
Transcript
2023 Q2
28 Jul 23
We continue to closely monitor end-market trends across all our businesses, particularly in electronics, consumer retail, industrial and China and have yet to see signs of improvement in trends. Therefore, we currently see organic growth tracking to the lower end of our range of flat to minus 3%
rev tracking to low end of guidance
Transcript
2023 Q2
28 Jul 23
While end markets continue to play out as expected, Q1 and Q2 revenue was slightly above our expectations.
rev \bove expectations -- but only becayse of fx?
Transcript
2023 Q2
28 Jul 23
Consumer
consumer
Transcript
2023 Q2
28 Jul 23
Separation and purification and Health Information Systems declined mid-single digits and low single digits, respectively. These businesses continue to be impacted by lower post-COVID-related biopharma demand and ongoing stress on hospital budgets.
As procedure volumes continue to improve, hospital budgets stabilize and we work through post-COVID-related impacts, we are confident in the long-term outlook of this business.
still covid impacted
Transcript
2023 Q2
28 Jul 23
Health Care
health care
Transcript
2023 Q2
28 Jul 23
largely due to the continued decline in demand for electronics.
Our auto OEM business increased approximately 21% year-on-year, approximately 600 basis points higher than global car and light truck builds.
Our electronics business continues to be impacted by soft end-market demand for electronics.
weak electronics, good auto
Transcript
2023 Q2
28 Jul 23
Transportation and Electronic
t & e
Transcript
2023 Q2
28 Jul 23
Safety and Industrial business
s & i
Transcript
2023 Q2
28 Jul 23
Second quarter total adjusted sales were $8 billion or down 4.7% year-on-year. This result was a little better than forecasted as we experienced a smaller-than-anticipated headwind from foreign currency translation of minus 0.9% versus a forecast of minus 2%. On an adjusted basis, organic sales declined 2.5% versus last year
sales top end of guidance but only due to fx better than expected
Transcript
2023 Q2
28 Jul 23