VMI - Earnings call transcript Q4 2019 | Valmont Industries, Inc.

Due to licensing restrictions, you must log in to view earnings call transcripts.

Operator

Greetings, and welcome to the Valmont Industries Fourth Quarter and Full Year 2019 Earnings Conference Call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. [Operator Instructions] As a reminder, this conference is being recorded.

It is now my pleasure to introduce your host Renee Campbell, Vice President Investor Relations and Corporate Communications. ahead. go Please

Renee Campbell

Officer; Good Vice fourth Kevin. With and to and Chief welcome today and Vice Thank Financial and Chief and morning, Corporate full Industries Officer; Executive and President quarter Steve Francis, call. Jaksich, year Valmont Executive are President Senior you, Tim Kaniewski, everyone, Mark President XXXX me earnings Controller.

well a Mark as Investors at valmont.com. quarter website and financial results and will This followed additional A fourth performance outlook by morning, and on our full slide accompany our our available as Steve for XXXX presentation the brief summary for download of will today's on provide provide is details Q&A. page year discussion will

is days, press for in Investors and are included forward-looking of discussion of conference of on this our which our also call the release, it at be to instructions this available today's replay A to Please applies end call call. on X note website. and will accessing the today's in distributed the be full located which yesterday was subject disclosure page and read next will for that the statements,

like now President Chief the Officer, call to over and to Steve our Kaniewski. turn Executive would I

Steve Kaniewski

this joining performance Good past and Renee. associates team year. global morning, morning Thank you, by our their like thank us. you everyone to for I'd thanking this XX,XXX begin of for nearly

progress made four in year While many growth segments. significant we full results in our in goals, XXXX all did meet our achieved our areas not of three sales and of

through commitment accelerated agile new and We throughout services. to elevated the innovation and lean and our products drive organization

a of working in heightened of the spring, very infrastructure to And million capital demand. improvement. customer event disruptions $XXX free market strong cash we flooding historic over responded during on business a generated and quickly minimizing a period last flow focus also through We impacts

real our global the of teams. testament accomplishments All operational a to excellence of these are all of

on year due summarized areas business: brief the Net recap slide sales declined last two to lower sales Access presentation. quarter significantly of million With of our and primarily fourth me a to turn our Systems to $XXX.X Irrigation. International X that, of let in of compared X%

American North challenging were markets, higher revenue reduced and in by transportation all production from strong and sales, market industrial U.S. sales discipline. a segments agricultural wireless The environment communication despite acquisitions levels. were in technology Sales across higher markets led higher recent sustained pricing demand irrigation and

strategy. platform purchase in the position past During million, sales to has a technology the we model for profitable provided and a in the has Its growth stake technology accelerated our revenue AgSense the fourth quarter, XX% years significant over leadership $XX finalized agreement recurring our five the in remaining technology field. milestone for

to welcome the the team Valmont AgSense excited are family. fully We into

$X.X We income. on the was nearly similar year. pressure billion last sales of Net full segments and to X% to growth year XXXX sales on achieved to X. Turning of continued players to irrigation, representative other in which down similar ag compared all net slide farm summary were except

structures lower Coatings. and were wireless volumes lower very volumes sales and benefited to due utility XX% a from as Offsetting recent both of pleased pricing well in from sales and we were to All segments growth irrigation capacity mix growth XXXX. achieve strategy sales less and communication disciplined in higher growth acquisitions in available as smaller technology and Irrigation

in to Australia lower were System XX% with down led the year to Support construction in for the markets quarter. the segment, last decline of the Structures product year. In significantly fourth Recessionary sales compared Engineered volumes Access most occurring

Turning to slide X.

our technology take some businesses. these our services. you initiatives into minutes XXXX, I'd key about accelerate During advances of strategy our to and we like to to in to made few across and a meaningful speak products innovation

of are pole in our on growth cell and In there. we technology increasing have accelerating networks demand in and antenna XG our our solutions Investment to leading increased which concealment. also and Engineered Support small innovative structures capitalizing for investments development integrated is Structures aversions smart cities expanded we is product locations, unsightly segment, to

technologies smart these been have of are All elements received necessary -- the city and evolution favorably the favorably been of products our by market.

of In the Utility conditions customers basis This section grid beacon an the of source business, our remediate helps the shutting real-time reducing are piloting line power we technology entire and at a utility and time solution on structures. on cost grid. down identify

a and that power impact lines drone utilizes to along costs. and issues have team also dedicated We operator identify environmental reducing technology quickly assess

a a efficiently along customer on and assess detailed We and work to to local with recently without the use maintenance utility cranes take large way. This power will line. to quickly issues required structures Nebraska expensive partnered our other of photos needing of right allow

recipes global our Connector and all In Coatings standard across by repeatable Valmont processes optimize of our the our Coatings GalvTrac of segment are strong locations, example GalvTrac lean technologies and zinc application and proprietary work. unmatched standard industry. integrating a in

Connector capabilities The communicate with order instructions. their Coatings to provides specific to with visibility status interactive real-time customers

to Our the at using locations. quickly of technology X,XXX customer strategy grow XX to our XX coatings adoption over has led global customers

AgSense, XXXX attended of increased In devices month, connected the than more our forward. crop XXX, to Irrigation, has grew sign-on technology Last our continue Valley adoption management. in platform announced we to XX% meeting where our I we leadership cloud-based the for Technology drive American driven single which in field. newest connected led position XX,XXX North sales by dealer

and field. to platform the remediate between switch collect, allows XXX or issues and in control Valley need eliminates action applications on smartphone to multiple the and a to take other analyze data growers device the

is applications with Technologies. XXXX partner was Valley which in early our these Prospera Insights of launched One

to expectations. artificial adoption advanced crop Valley for Insights recommended our Grower remediation issues. intelligence detect and uses virtually has exceeded provide health

five monitoring already by acres X.X the to are million of up to expect and year. monitor We this over end acres million

product of development and very and two you As technology pillars strategic new strategy. to can future increase we in our growth see continue important investments our

Mark in China to want is over call I and safety coronavirus our the priority. our team results our situation. and outlook, financial briefly health XXXX our turn for top The of to on the comment I Before

the We are situation watching impacts closely continue to the unfold. and

it are Valmont suppliers does our our thoughts have our who their and been families, with impacted. many and and customers China As employees others

to turn will Mark. call the now I over

Mark Jaksich

Thank as you, Steve, My the press good morning, comparisons everyone. release. XXXX and in comments of XXXX's on on results based the are quarter adjusted fourth to outlined

was results. operating and line, Support Engineered last Systems of which X. slide poor million below product margin or of the XX.X% to largely quarter X.X% driven Access year sales by Turning impacted sales the income in Fourth performance Structures segment $XX

was of to XXXX segment performance improved profitability comparisons businesses In by as sales in unfavorable by America international was in driven North projects. volumes the Structures comparable large timing primarily Utility and lower offset Support our

the In a as some well to external due from segment, customers demand down with was to international XXXX profitability lack of sales project some below was associated profitability unfavorable Irrigation weaker this acquisitions. productivity and Coatings due year. recent

Lower by favorable a to which XXXX of higher was raw decrease deferred to investment material expense a income to expense, has statement $X.X compensation offset due in expense XXXX higher compared LIFO led prices the was realized. million as net increase mainly in income. corporate The

of XXXX. mix of rate the quarter $X.XX, share than The diluted due was lower XX.X% to differences XX.X% tax earnings. $X.XX of geographic decreased fourth quarter XXXX earnings Fourth compared per to in in

of income last slide to $XXX.X million on a to full X, Operating includes year. compared increased X.X% which point of income decreased operating Moving XX XX.X% headwind to deferred compensation was basis expense. due results sales,

income. As this by previously statement investment mentioned income has offset the

segment impacts $XX The incentive operating In Access in the main Irrigation in by these to decreased expense and lower million. the year approximate this share addition, Offsetting LIFO. $X.X benefit corporate poor $X.XX Systems million or business. million an per was were $XX earnings in factors performance income

effects significant a as for taken translation not Currency were whole. year the

Our X% earnings which year effective rate tax Diluted below year. XXXX. was to was per comparable the last $X.XX, share, for was XX%

of were items the there you called presentation. year. These during we As out know the summarized in items one-time of the number are appendix a

to on X. highlights slide cash flow Turning

million delivered sales was a and large driven capital on raw strong of negotiated $XXX including The contracts. operating focus flows certain down by million we XXXX. heightened improvement payments we process successfully expected, XXXX in very decrease meaningful compared As material to in cash on a $XXX.X improvements, in working inventory

the As more a exceeded times that result year. raw are we of earnings X.X pleased environment, efforts cost benefit of flow to the material conversion for stable a these free cash and net delivered have

steel across million all Turning United investments in in year facility to Poland, XXXX capital utility irrigation facility for deployment, supporting $XX by businesses. in and Emirates in of structures growth an our a structures Arab facility the new on accomplishments million Fort Meade, is shown a Florida our expansion summary spending concrete slide strategic the driven of new to was compared a in $XX Capital X. the

through and payment We and $XX the deployed just dividends share in over for Convert strategic year $XX cash. to ending three purchase acquisitions million of XXXX shareholders repurchases with final the Italia and million towards $XXX returned the million

XX now turn slide me to for our XXXX. outlook Let on

ESS the to per Utility share well reflects to full $X. business per as in be of to in of and expect as range diluted We related range our year Irrigation. earnings segments uncertainty earnings $X.XX The project in share our timing International higher

to from in Irrigation X%, to to We expected X% are the any to few further due and segment future the of which range revenue in to lower will revising the is a downward our which excludes of projection situation, range speak revision X% a The growth organic minutes. to I sales a X% range coronavirus acquisitions.

XX translation operating costs levels. based stable immaterial in and are net expected a be XXXX is point to freight effects with to Foreign and we average be to expect XX basis raw rates currency material improvement expected including margins on current

Full to strong is XXXX be cash to as due not of year couple quite flow as expected a factors. free

strong in includes North up First to $XXX additions in facilities some XXXX from businesses Structures and demand spending finishing be $XXX and American and million million capital to support capacity strategic market between of projects. projected expenditures existing are our

large working fewer otherwise sales we benefit, in should capital improve payments to the efforts year. contract continued expect throughout Second, performance, XXXX, from down but

XX%. capital We on our after-tax return expect invested be to around

XX%, to year and approximately Our tax tax estimated income. our is rate be mix the current geographic for laws pre-tax on based of expected

XXXX, to LIFO, matching provide use only Turning beginning lines. in country costs it we U.S., revenues allowed. in which change This fiscal inventory is the product our the to of will method discontinuing the the better a for of are is where LIFO

And this and inventory our also results. enhances prior all method the change to operations year's provide comparability across, to with will respect of accounting, uniformity

will LIFO, also quarter, reporting there I'd like next With first XXXX, of comparisons. highlight. respect to items are the previous quarter financial of impact of a Beginning couple exclude our the XXXX to from

in both in share the this year. while of Structures repeat not to Midwest expect lower and sales impact wind are year's by expected full year mainly in combined $XX due with the along a lower $X.XX growth, income, solar project million from offshore to timing. segment, tracker diluted And XXXX businesses, expected Support Last our per be first the is, to operating event associated flooding to quarter Utility compared we

we XXXX from purposes, to first company expect, to be the modeling international in lower revenue slightly to For the for utility. flat compared sales quarter down, the expected

is some impact there coronavirus, from business. the around our uncertainty Finally, on the

that of to pleased although, lower operational are report restrictions. due are levels, We and at facilities our the capacity production all mandatory slightly quarantine to have resumed

the continue closely assess and situation. to We monitor

full As million to have to These year effects due been resulting our to closures, revenue $X mostly included quarter in extended mandatory of first efficiency. million, today, factory outlook. impacts we operational be and on estimate impact $X

turn the will that, over Steve. With now back call to I

Steve Kaniewski

steel quarter, management manufacturing teams well host and in Minister to Thank to Last you, excited our honored Poland. celebration attend was the as local several were the new local dignitaries, grand structures Mark. the employees. Poland celebrated with opening of officials I and facility, we of we Energy. our as And personally

global facility our true Building to excellence, a well of serve in positions infrastructure markets. best this us as center customers,

Moving XX ahead looking to and XXXX. to slide

We start to to solid are off year. a the

global continued entered Engineered a year, government Growth investments, being backlog. by Support development. Structures in has infrastructure is in with driven the solid markets transportation

the in the growth continued carriers, in And XG half expect components. of to wireless year. and second communication accelerate, investments products We of anticipate

considering in growth and record T-Mobile-Sprint the We XX% merger. expect market expected to XXXX to this growth our year, sales approach delays XXXX, due

can with which reevaluate profitability. As previously business impact low in Australia Access and quarter-to-quarter, levels, a sales of significant on we strategy and can led in to said, associated of from meaningful recovery XX-year market us market Systems our uncertainty have carrier spending has the construction lumpy be The underperformance our have there.

with on accelerating attractive we result, that return our line. a path are strategic stated forgoing invested of to require and an analysis the identify opportunities, this to This financial profitability As profile product capital aligns may a revenue goals.

starting to businesses. next in also by global more currently renewables. a with we'll investments In we reviewing from all are details ROIC, supported backlog sharing Utility across $XXX with demand, our be are improve segment, other the and nearly of quarter. you We million, opportunities year-end grid across hardening And substrates, record XXXX increased

As adding associated the we existing North segment. capacity year, for have throughout to the revenue to previously ramp American we And are expect mentioned, plants. this

sales Turning the remain production current Irrigation noticing American levels to similar we the to the unchanged. a be global yet not sales in Coatings we we segment, industrial are turnaround In in expect XXXX, higher segment, were pleased demand. with significant North assuming fairly fourth quarter, while to

substantially net in grower XXXX, U.S. seeing improve. not projections but stabilizing are sentiment income expected We farm to are

down we for our markets, to these change meaningful markets, including Brazil expect meet to we network expect dealer we to developed have more In flat been a growth strategically where demand. Irrigation Without sales be year. the expanding increased international segment in fundamentals, X% to

to said as good a business, line have We timing of shipments be the project uncertain. of can sight although we've

Turning discipline year to driven businesses solid is pricing segments. growth supported and all in being our across Revenue slide this X% higher in XX by of volumes infrastructure by X% and to backlogs summary.

our production ag similar growth, on We levels, optimistic be Coatings sales others the XXXX industry. businesses We in cautiously industrial to remain U.S. flat with expect following irrigation to trends.

stated encouraged are flows. steady against allocation we that freight materials are which good markets. continue in will stabilize while cash helps pricing goals, and our to remain generating We relatively to our And perform raw expected capital

turn back call I Renee over will to the now

Renee Campbell

Thank this you questions. may call you, the for Kevin Steve. time up at open

Operator

Instructions] first from Chris Moore from Our today [Operator question coming is CJS Securities.

is line live. now Your

Chris Moore

good morning. Hey, morning, Good guys.

couple Just a margins. the of questions on operating

kind uncertainty a Systems, talk operating margin in the about the Access you operating Valmont your guidance? margin of relation bit to in given the overall little like can looks XXXX what So ESS

Mark Jaksich

on you say orders I all, not system we Mark. reoccur first the will out which Yeah, is that Chris, those of had now. in charge of this third took would we the if business remember quarter we're since detention

but And headwind have to that depends. in think be some probably help, going the Access certainly the say should North overall half first out. year Systems, would that, pretty although, that of we continued headwind I through I solid So called we're would in But the margins America. it –

to develop, to the certainly plans as restructuring goes expect year our As we we stabilize that along. start

Steve Kaniewski

rate account is current into range. in the our of present, Systems at guidance And where Access taken

should help improve that restructuring so forward. point from And

Chris Moore

Got it.

other on the The question margins.

going In the ramp terms USS? in of we're first – on the to still USS you there. capacity is it's of another year to that ramp talking for probably much about Is margin understand half there so the quarter a – you there. trying full impact take to or Just X% get

Steve Kaniewski

business. the half pricing it's as North Then, American of we adds, said that more the Yeah. we on There's capacity SM based out and volume that, year take add will obviously the our we some the through X% go both the year. it to the second called will volume improved of which in solar the of some projects really

America very a gross margin ramp North as nice year through the operating or margin a still kind So we we'll strong, see very there. of

well year, capacity as of you're going depressed a the than to be half the timing the really the the just of first of half as year, So volume. combination second both a a more little as the of see maybe

Chris Moore

guys. Got it. I appreciate

Operator

you. Thank

is next coming William question Blair. Our from Drab from Brian

now Your live. line is

Brian Drab

Hey, Thanks for taking good morning. questions. my

are through just point? handle those time Utility lead point you're coming the orders order the for be larger additions on what's where And place large the in you're the able you segment that to the I one now? – that at to making. First, that this capacity Are clear wanted made to

Steve Kaniewski

Yeah.

through as things would starting reasons through We quarter, So in quarter. the capacity had will fourth now online put some deliver some done continue quarter come in that sequentially slowly really then of saw we related at rates. the additions as obviously that more the really that second one the the things so was expect we quarter fourth second we in There and -- place we quarter. into are the you particularly just additional personnel and could $XX go million the around year. quarter, and third at end will to from the That that be to be to run first third ramping of

Brian Drab

Okay. on And order large or are what's you that this shipping those of at shipments? point, timing beginning the the

Steve Kaniewski

the and shipping the one that since product the project quarter that actually we that shipping was third been been shipments of have it that and productivity of hard. and have all hit we've Yes, quarter along. was so ramped reasons But third

been been we as project speak. that has that delivering we've So going and

Brian Drab

got And there Okay are little And detail solar in business can the you now? I'm just business this a still the expecting it. And how to you margins growth -- what you strong relative forward business. big that mentioned give average What's corporate that double-digit wondering, the margin? business? then the at are is point? on just more going that

Steve Kaniewski

Sure.

maybe we as built three years had into So $XXX do opposed tune said year million specifications up. would timing when as over specific. look some what over And say and let's the the we we the to approximately that synergies, very a that. on to And it to million was project chain supply course from it this as is the be based margins some saw ramp decline expect year. we perspective, of on picked million common a about said We $XX $XX in based of this XXXX, we business we

say we But would so margins. it sense a it at segment expect would segment to decretive margins, really little -- XXXX that as relates it's segment margins. -- by And mid be of the from in

Brian Drab

the in injecting do or sensitive system wondering share just a I'm competition position solutions connected seeing highlight because know that you're feel is into course changes and you But like you share, continually Okay. to And listening. in segment. as the Are the internationally? I this is U.S. any of then you improving or continue little your technology the irrigation and that that's always

Steve Kaniewski

installed I think is from long-term significantly What are revenue market we opportunities. the always perspective. really the say more we systems doesn't change our a seeing pivot that U.S. share base

strong. and bringing It adoption well strong. And so grower really with that AgSense the exceptionally been rate retention the unit the as the input has has real rate for -- has been productivity as lower connection costs

its of everything -- is after. go And yes you obviously a so total it's share really

So more from we it that sense up because we we're picking opportunity, have revenue that believe way.

Internationally, it's door component increase providing and opportunities markets opportunities that our Europe there those we're the particularly in a Brazil labor good to like market to seeing is a definitely connected as really as markets. far where big continue across selling

So of machines XXX,XXX competitive of our there's machines. our XXX,XXX

can AgSense take them of unit on All an them.

And do of that in bit believe quite so we a market. still there's runway

Brian Drab

I one of kind to that kind seen those ask ramp quarter the just question. in this to to or shipments materially, now order I that But can the my we to year. already ship ramp large clarifying project? start that last quick numbers that Does began quarter? of is guess size then late of last run first was Have I That And the fourth is what wondering. Thanks. in to question. Great. began Back related rate per --

Steve Kaniewski

about the $XXX million was the year. way to were delivered per and roughly be Yes, orders taken

big to you that think about have orders. way the those that's So

Brian Drab

All Thanks much. Okay. very right.

Operator

Thanks.

City next Our Capital. Jon from from Kansas question Braatz coming is

live. is line now Your

Jon Braatz

Steve, good Mark. morning, morning, Good

Steve Kaniewski

Thanks, Jon.

Jon Braatz

in going or some prices, Coatings the segment are a Coatings the result you down my we on? that Mark come guess zinc of in pass be, might having we've I are sharply. recently fall the zinc as question improvement seen And see to margin In to prices

Mark Jaksich

that pricing -- we performance to customer attempt hoping the that do we we and sure I And hang But value we best business it. that no, of were we continue as where the on mechanism for in out as on pricing in as bit to Well, internal what every drive for It's passes a we there's to along. that we're Connector external of kind markets think, I stickiness long the a Coatings drives so of think, to as making from hopefully pricing Valmont get that's forth. good little have that the can.

with -- back to speaking you bit in on hang cases no there. a So and not get we've -- here fluctuations. do some generally able generally to But we're and been little pricing

Jon Braatz

maybe I And I okay. misunderstood hear. didn't Okay,

the sort did in XXXX revenues terms expectations volume there terms of, In for any you guidelines of Coatings the and give for of, any, segment?

Mark Jaksich

too. the I Mark Coatings probably best relatively We're industrial to Yes, watch. And indicator the in business right production think particularly Jon that don't this rate is now. across be growth robust that's it is expecting that we flat.

Jon Braatz

Okay.

maybe coronavirus. in Okay. hearing Steve there some -- a We're some logistical challenges that are emerging question on the China.

let's result any the seeing logistical companies In difficulties any that the terms anything direct or coronavirus? issues the product moving addition you in feeling. of or to in as ports to say, delays impact are a of Are

Steve Kaniewski

Yes.

In to terms provinces It's in if have of province. moving we to the that ports no, comes where coast. the from different because a on it get are we're steel

now right the trucker are into stands it because to that As most go have quarantine. then interprovince affected the shipments it's

So see only we logistics the where the place occurring. that's issues really

getting that We've steel from it at but interrupts of bit we're would in helpful. moved provinces point. just supply case from -- well getting a it who some it we our That be government secure. around within issues of the get when can steel and Now pertains this we loosening heard supplies and can is there's the enough It those also little restrictions. the at aware with as it to least that contemplating is still

But not impact. to-date have a we dramatic really seen

come at this revenue it right called Mark $X but million how a out, is to going. Hubei as And was province. as thing finished in until handful the into of plant to where develops, again from top are right is we're we now. not their maybe as And still all get Our maybe quarantine people of they this were now subject the latest do plant see maybe have we the that's coming back of generally impact that But a able quarter. South the to

Jon Braatz

you right. All Yeah. Thank much. very

Operator

Thielman Davidson. Thank you. Instructions] [Operator coming D.A. Brent is next from Our question from

is live. now line Your

Brent Thielman

Good back Thanks. here. of some got Great. bit issues a the had late challenges just guess I in in given do portfolio morning. about of Steve following I in really going I I have had step I should think the just a you've forward? really you offshore the you these And on And core Australia how one. business Europe. focus today? guess apologize, Valmont the taking what be and

Steve Kaniewski

take Well, have Systems, Access internal if really an we do I compare and contrast.

Our Access Systems the well, it of and business work structured of profile a overhead it's very to project revenue in Asia time. is different that so does able carries movements but kind it over differently withstand on

that overhead at So go by look we said recession has to business It have that just we within back. the of kind as about and hit get construction. way Australian basically been really again a structure like to I believe the XX-year a in

just very now. level a it's right So depressed at

a fairly there over was at in for that. you to end business will of into XXXX. utility successful to actually that been have movement about well There time talked order have a orders this obtained year the and The get We as sizable offshore we've wind utility and put ship later masts.

process. bidding year of end that with times. coming there our there. There's do XXXX. and a called the very improved long competitors the very of And the And into successful margins. we of because on we're tight and tail occurred towards at that got that We see so are keeping kind again bankruptcies out profile seeing that the lead business we through We just

We take the sized So business market that of to to an they standpoint just our sure infrastructure development. overhead and/or for appropriately with from fit have going project they to make can are they portfolio in. utilities that

Brent Thielman

this again if the Okay. New but utility I on Year. guess has apologize here I the been asked, backlog side into going then phenomenal And I mean

year? look there this through enough backlog of you there do sort you at pipeline tough a but this to think the there's and out of, be off As out level to would obviously sustain the build

Steve Kaniewski

continue. the seeing Oh, yeah. We work definitely are

million the unabated. issues you and The go more tendered. used potentials And If recall in that three California have utilities in as another selected we be be states. also large plus continuing really year outlawing orders two we're are reliability will forward. there's will $XXX wood This order Florida seeing other you

the sources, continue so transmission drive to And used. that continue to to them meaning market back to will just is strongly. and substations where generation get going they the lines renewables very need disperse to And electricity is the both

nothing between out would but where they that even move is would there anywhere at there's or So XXXX XXXX frankly now. suggest right point this it

Brent Thielman

Thank Okay. you.

Steve Kaniewski

Thanks, Brent.

Operator

you. Thank

Our Farley Adam from next coming question is from Stifel.

is live. line Your now

Adam Farley

on good Nathan This for Jones. is Adam Yeah, Farley morning.

Steve Kaniewski

Adam.

Adam Farley

excluding in Turning relatively back the to ESS, margins loss even System, Access are still light.

You pricing guys America. North discipline in highlighted

margins at So business? the impact any mix should what System the looking in Access quarter? there is on And backlog, expect then we ex your to core ESS

Mark Jaksich

we with next as end would that year a Yes, into at have North America, of in of Adam. revenue. the This issues timing is some more we the But the well. in carryover Mark. -- some jump really that's I'll had start off can and then But affected Steve deliveries year.

bit the tapered and have but that. XXXX we of over some a rate Telecom was still growth good, between down had that expected and of we

collectively businesses that a bit played think into international as well. And I So then the it. down were

were So pretty think and it between -- comparatively Access I actually the contributed really solid businesses which North part. substantially, course, tick, was had a international the rest XXXX. comparison of down to margin was and then we overall not XXXX the America for of And the most then,

Steve Kaniewski

quarter just -- out we the the and margins fourth some rest lower as of about year. of par mentioned normalize on probably with getting kind And issues, were the as a you Access the if loss, Yeah, mix Mark in there telecom last year. for orders were compared of to timing some

were those So there. big highlights the

Adam Farley

pricing how And favorable within that? Okay. your mean, That's you pricing then looking levels at I expect there? helpful. are do backlog,

Steve Kaniewski

Yeah.

for we materials time said to As really the actions. being that period been have stable stable that you they pricing raw on allows work

that some backlog margins good good backlog in itself. so that some generated And has and

can we of ESS we the profile And that fix that we as Systems into XX% get as so optimistic go we again remain margin business over XXXX. Access

Adam Farley

That's emerging have getting on to Do International helpful. markets you to shifting timing? And projects larger visibility your projects? then driving in These that? color more still it what's keep mainly seem Irrigation. Okay. there to Any just pipeline on Is pushed.

Steve Kaniewski

mainly have what as markets. have these ability you ship. against It's to know of a and get dollar currencies our developing strengthened the lot slows usually paid, Yeah. That to And is in timing. therefore down many

Middle Asia. a and Central part process through. still is have moving in the that the of kind So good still it We East of pipeline of across Africa, across

so we timing feel there. And tough, the is that's that albeit

Our impact we them them, so guidance down upside get that were would the downside. the as projects really has than an -- be minimized a a not international of of having it more to if

we conservative approach. more So a took

Adam Farley

That's for my great. taking Thanks questions.

Steve Kaniewski

Adam. Thanks,

Operator

Thank you.

Our question from Blair. from Brian William Drab follow-up a is next

Your line now is live.

Brian Drab

Thanks for the taking follow-up. Hi.

momentum you about? Where that have to order seems the What are is But else opportunities noise the Irrigation talked just get draw you two and of you over backlog Is I some great Is the from? we've Sorry, to one where mean, growth -- if Thanks. your in background like kind I'm expecting if are come picture if about rank the on opportunity? the projects. conclusion from where little most to there's the lot years? and we two a had potentially one the going are like trying some where it next wanted growth years the most to really, a bigger growth of next to here get this. outline here. of projects? just Is there -- International XG the it kind over feedback to the record it utility solar? larger other it that you of excited you

Steve Kaniewski

products. we're Yes. of suite Utility, a offering -- obviously we've Sure. brand-new

pole, a preassembled We we have spun in there. general dynamics concrete just substations that addition distribution have to market are strong

So we the look to as we the growth feel utility near has potential highest over medium-term.

said prognosticators recall to would starting industry XG. one. growth real would it XG, in little in handicap if way. slow still said our And quarter to that's XXXX, The XXXX all we be looks through the that fourth bit we it would it of see ramp what it kind that a That be We of ramp is or telecom like. be second you would that opportunity we the did. And

be come they third Irrigation. as our projects International do do -- tend through drives know pretty profitability itself when yes, substantially. to sizable. then, irrigation large are tend they really to Those they you is be And And

So, as markets a we even get move as any forward. kind if we would just of have earnings slightly, up lot behind it, -- Irrigation power of flattened were move to

rank kind the we internally those of So are way them here.

Brian Drab

much. very Thanks Okay.

Mark Jaksich

Yeah. Mark. Brian, this is

Brian Drab

Yeah.

Mark Jaksich

trend. to opportunity telecom add a the Just is global

don't have Asia we in do So we do we geographies much exposure to today. build as But really of presence a well we that quite there's well, we off but Pac. other in or do opportunity do think continue have telecom an as as some as

Brian Drab

Right.

much. you very Thank Okay.

Operator

the session. question-and-answer reached Thank like you. Renee. We to floor to I'd our turn back over

Renee Campbell

Thanks everyone today. for joining us

Thank you today's you. mentioned, be or website on phone playback look speaking next to days. again quarter. As by the for call next will our with forward seven We available for

Operator

factors has Litigation meaning in Included Securities management of in light Act the These forward-looking discussion on to and of historical in Valmont in the that within conditions, this circumstances. management's under the based are made expected other which as statements the forward-looking of operates, be developments XXXX. believed industries of Private appropriate are well experience assumptions as Reform statements future trends, current perceptions

of comments, to control and involve guarantees should that these understand statements performance of listen Valmont's are consider these and are you you not which They risks, uncertainties, results. or beyond assumptions. As some

on are you results financial those materially forward-looking assumptions, these could differ and aware statements forward-looking to factors believes that from that them Although many should management actual Valmont's anticipated the in cause reasonable based statements. affect be

any included and the forward-looking and actions product statement undertake not in and factors acceptance this to Commission things, and to products, future discussion foreign reports company material, discussion as the well the Valmont's time-to-time as domestic made and circumstances, of financial cautions pricing, as new and environments, efficiencies, policy include does Exchange from Securities conditions, governments. international any and risk factors that and in availability of and other competitive economic of described company The availability among and market forward-looking operating raw of performance this of date results, These update price changes domestic market statement. company industry is

teleconference. This concludes today's

lines time. may this at participation You your We thank today. your you disconnect for

Valmont Industries (VMI) 20 Feb 202019 Q4 Earnings call transcript